After the collapse comes inflation: Ray Barros
Watching the US government invest US$20 bln in Citigroup shares and guarantee a further US$306 bln in loans may save the day for now. But the scenario feels rather eerie (continues below video)...
...when you consider that this money, along with the US$700 bln already pledged to help the banks, plus another US$25 bln if the car companies get their desired hand-out, will need to be soaked up again.
Meaning: this trillion dollars in money which the US government has shaken out of its sleeve will, at some point, find its way back into the pockets of consumers.
And when it does, argues Ray Barros, inflation will be the next big thing to worry about.
In other words, we'll drown tomorrow in the waters which we are using today to dowse the flames.
Not that the US government has much choice. It's a little like standing in a wobbly aluminium dingy: The boat has rocked too far the left, but overcompensating will rock it too far on the right. It'll take a while before it steadies. If we don't all fall out, first.
I recorded this interview with Ray Barros a few weeks ago, but his words still hold true today. Perhaps more so.
I welcome your comments.
PS: Ray Barros will be in town December 6 at Singapore Expo Convention & Exhibition Center.
Archives...when you consider that this money, along with the US$700 bln already pledged to help the banks, plus another US$25 bln if the car companies get their desired hand-out, will need to be soaked up again.
Meaning: this trillion dollars in money which the US government has shaken out of its sleeve will, at some point, find its way back into the pockets of consumers.
And when it does, argues Ray Barros, inflation will be the next big thing to worry about.
In other words, we'll drown tomorrow in the waters which we are using today to dowse the flames.
Not that the US government has much choice. It's a little like standing in a wobbly aluminium dingy: The boat has rocked too far the left, but overcompensating will rock it too far on the right. It'll take a while before it steadies. If we don't all fall out, first.
I recorded this interview with Ray Barros a few weeks ago, but his words still hold true today. Perhaps more so.
I welcome your comments.
PS: Ray Barros will be in town December 6 at Singapore Expo Convention & Exhibition Center.
Labels: Citigroup, Ray Barros, Singapore Expo Convention Exhibition Center
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