Did Obama Really Triple the Money Supply As Some Have Suggested?

Did Obama really triple the money supply as some have suggested?

Did Obama Really Triple the Money Supply As Some Have Suggested? 1

NO he just tripled our debt

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he Fed's open-market purchase causes the money supply to ?

1. D. The money supply increases by $200,000. 2. A. Increase

Did Obama Really Triple the Money Supply As Some Have Suggested? 2

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Does increasing money supply worsen income inequality?

Political which will lead to financial instability

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Isn't it true that federal spending increases both the MB monetary base and the M1 money supply, therefore, the Federal Reserve does not have full control over the money supply as believed by some?

Federal spending, coupled with taxation and/or bond issuance, is a wash as far as MB and M1 are concerned. In both instances, the government simply spends the proceeds back into the economy, returning both the reserves and the account balances (M1) that it collected to previous levels, assuming that the government spends all of the proceeds. (Which is a pretty safe assumption.)It's the central bank (and only the central bank) that has the power to adjust MB levels. By buying and selling bonds (mostly Treasuries), the Fed can alter the makeup of total government liabilities (bonds reserves cash) held by the private sector.What the central bank cannot do is control M1 levels, and M1 is what the economy transacts with. They can tinker with the overnight rate in an attempt to influence private sector lending, and they can add or subtract a bit of M1 (account balances) by buying or selling bonds, but M1 levels vary with loan activity, over which the Fed has no control. It is possible for the Fed to set a hard upper limit on lending by restricting the amount of reserves in reserve accounts, but they don't do that because they would lose control over interest rates as banks bid up scarce reserves in order to lend

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How can FED increase level of bank reserves without changing money supply?

By increasing the interest rate

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How does the money supply behave when bank loans are repaid?

The creation of money occurs when the bank loans out any amount not backed by its reserves to a borrower. The borrower's debt is the excess money. As the borrower pays back the money to the bank, the supply of money in the system contracts. This is of course until the bank lends further against its reserves to another borrower. Interest payments are akin to money received for a product, that is the loan, and management of the risk held by the bank in lending money. Interest only loans pay for the service of holding the money you and the bank created by borrowing from the bank. Then like all loans, once the payment is made, the supply of money you the borrower created is shrunk. The bank however has made money on the interest.Over time supply and demand for loans and lending expand and contract the money supply. This coupled with the reserve rate requirements dictated by central banks dictates the supply of money in the system.

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Whether you agree with Ron Paul that the Fed created the inflation leading to the Grt Depression and created?

First question: Why is there no oversight? Before the Fed was formed in 1913 it was the job of the Congress, Senate, & President to provide oversight of the U.S. Treasury, currently 435 Congressmen/woman & 100 Senators the President & the government employees of the U.S. Treasury, who issued and stored money. Ron Paul feels this system would work better than the Fed's current system. Originally, anyone that worked for the Treasury would recieve the death penalty if they were caught "Cheating" on the amount of precious metal in the Gold/Silver coins. 2. The Great Depression: The Fed was formed in 1913, the U.S. dollar "WAS" backed by 1/20th of an ounce of Gold. In about 1918 the U.S. entered WW 1. Because of the war costs the Fed issued way too many unbacked dollars. This led to the roaring 20's after the war a period of plentiful money, a lot of which was invested in stock of companies. Along about 1929, investors realized that all the dollars in circulation could not all be backed by Gold and panicked trying to cash in their dollars for actual Gold. stock market crash By 1932 the government//big bankers, had spent too many unbacked dollars issued by the Fed overseas and did not have enough Gold to cover the paper bills. Roosevelt, in 1933 decreed all Americans must turn in their Gold & outlawed the use of Gold. The Fed, knowing they had issued way too many unbacked dollars, severely tightened the money supply which made matters worse,,,,,now nobody had any paper money or Gold,,,,,"The Great Depression". Please think about this because the history we are taught in school is not entirely accurate. *********************************************************

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What Happens to Exchange Rate When Money Supply in the Economy Increases?
What happens to exchange rate when money supply in the economy increases?When money supply rise, the interest rates come down. This is opportunity for investors for cheap funds to invest. They also sense out I mean the investors that the systemic risk is contracting and is investment opportunity in a short while. Then they borrow cheap and invest which will send the inflation rates upwards on increased demand for goods. This will create inflationary pressures.This can lead to loss of purchasing power. The inflated price of the products will cause the export prices to go up and this can cause dip in exports and this will reinstate the currency value back. This simultaneity will create feed back effects and keep economy in stability, if the policy makers like rbi maintain normal oversight. Then efficiency of the economy if high then this upward and downward movements and stabilization will be more pronounced.Then, so many local circumstances will make it sometimes difficult to clearly see this opposite movements in short periods. Adjustments can create lags and anomalies which can prolong the reinstatement of stability in currency unless the local economy criteria make it otherwise— — — — — —If the government has increased the budget deficit and interest rates have remained constant, has the central bank increased or decreased money supply, and why?The Fed adjusts money supply to maintain its target fed funds rate. That is called open market operations. This rate is not highly correlated to US treasury bond rates which are determined in an auction (demand/supply). US treasury bonds are what are sold to fund a deficit in fiscal budget. So these two concepts are not related.— — — — — —Inflation is the expansion of the money supply. That results in a general increase in price levels because people got more money and they will demand more. But how does it lead to a general increase? How can people demand more of everything?Looking back over the past 75 years, "inflation" was, imho, a consequence of the 30% of the US population that was in a union, and benefitted from collective bargaining. That constant push for "higher wages to keep up with inflation" ultimately created the inflation they were trying to overcome. When Reagan "busted the unions" by firing the air traffic controllers, the influence of unions, and the number of strikes for higher pay fell off dramatically, as did union membership. Today, unions represent only about 5% of the US population, and wages have grown at a much more sane rate; no more "I deserve a pay raise because I've been here for 20 years," only raises based on merit, skills, and especially, adding value to the job— — — — — —If the money supply in the/in an economy increases, why does the average price of goods increase?When demand goes up and supply stays constant, prices must rise or shortages will result. so in essence you have to pay more because other people want it too. either way Shoplift wherever possible. Companies factor the cost of shoplifting into their prices, so if you do not steal, they are effectively stealing from you.— — — — — —According to monetarists if the velocity of money is stable, an increase in the money supply will have which o?b. If the economy is at full employment, an increase in M will result in a higher increase in the price level faster than GDP— — — — — —Isn't it true that federal spending increases both the MB monetary base and the M1 money supply, therefore, the Federal Reserve does not have full control over the money supply as believed by some?It's hard for me to see how the Fed has any control over "the money supply." The "money supply" might have meant something when every dollar in circulation had to be convertible to gold and the number of bills in circulation, not to mention the sum total of them all, ostensibly had to equal to the amount of gold backing them.Such is hardly the case now, when money is electronic blips, checks, credit cards, currency, physical assets, tangible, and intangible assets, and everything in between or outlying. IMHO, the concept of "money supply" is indefinable. Not that someone wo not , in all likelihood, try to do so. I doubt that I will be persuaded, certainly not easily.
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