[BlueStreak]

Originally Posted by Twodogs

I heard some interesting numbers late last night and thought I'd share them with you guys. In the bad recession of the 70s, the government printed money equaling 13% of what was already printed. Supposedly interest rate increases follow money printing by 1 to 2 years, and they did this time resulting in the 20% rates we all remember from the 70s. Fast forward to this recession, and the government has (believe it or not) printed monies to equal 120% of what was already in circulation. They eventually have to bring that money back in and destroy it, and that's where the rate hikes come into play. So, if rates hit 20% due to printing 13%, how high will they go this time (after 120% printing)? As for now, most of that money is just "sitting" in banks, making them solvent. The problem starts when they decide to loan that money and it hits the streets (inflation). Then, if interest rates do climb to say 40% or so, people quit borrowing. That means they don't buy cars, houses, or run businesses very well. At this time, we can expect the dreaded Hyper-Inflation.

Just one simple question, Twodogs, because I really don't understand;

Why?

Dave