Gary Halbert post, 5/28/14

Wide ranging post:

1. Warning: Fed Is Sitting On “Ticking Time Bomb”

2. Why Banks Hold Excess Reserves at the Fed

3. Back to the “Ticking Time Bomb” at the Fed

4. Question: Is the Fed Paying Banks Not to Lend?

5. Dinesh D’Souza to Prison, Jon Corzine Goes Scot-Free

 

This post contains an excellent explanation describing the difference between REQUIRED reserves and EXCESS reserves.  I have read a lot of articles that confuse the two and claim that money at the Fed cannot cause inflation.  This is just not true as detailed in the article above.

I would also note that it’s easy to see where a lot of the newly printed money currently is residing.  Also note that the rest of the newly printed money is sitting around as well:  http://www.investing.com/analysis/the-velocity-of-money-in-the-u.s.-falls-to-an-all-time-record-low-214607

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