Follow the money?

Icollecteverything

That's what they say when you need to figure out something, right? Follow the money. Trillions of new dollars created and yet inflation is not bad. I don't want to argue about that, I know there is inflation like in food in particular but if you average everything out inflation really is low.

I think it could be because all this money they created out of thin air is just sitting around, it has not made it to the masses. If everyone had some of the money then we would have inflation.

So where did it go? They used it to bail out companies so that just replaced money the companies had lost, like magic. The banks have lots of new cash but there are plenty of complaints that they are not lending it out, except to rich people and corporations. Many Large corporations have record amounts of cash on their balance sheets but they are not hiring or expanding with it, they just sit on it.

Rich people have more cash but they have been holding it too. Have you seen the commercials directed at the rich that you can borrow millions at about 1% and they give you a list of compainies with dividends of 5% or higher?

The Federal Reserve has lots of "new" money. $3 trillion on the balance sheet. They created a bunch of paper (or electronic) money and then used it to buy more paper in the form of treasuries and mortgage-backed securities. One giant shell game. The Fed is a quasi-public/private company that nobody understands but I don't think the public thinks the money in the Fed is "their" money. I think back in the day of metal backed money the public considered Fort Knox to be "their" money. Luckily, most people don't think about it now or they would go nuts.

So how come I didn't get any of this free money?

derryb

<< <i>So how come I didn't get any of this free money? >>


Do you qualify for government entitlement. It's being funded by debt that in turn is being funded by QE purchases of that debt.

melikecoins

I got some free money a few years ago when the bank/goverment refinanced my house. but that was it.

Glen

mrpaseo

I screwed up big time in 2010, I paid off my house and was unable to take advantage of any of the free money or great interest rates... Sucks.

derryb

From zerohedge on today's Bernanke testimony:

"The following brief exchange between a congressman and Ben Bernanke pretty much wins today's Humphrey Hawkins farce.

•Q: Are You Printing Money?
•Bernanke: Not Literally

And a FTW follow up from the Chairman:

•If the Fed were to tighten policy, the economy "would tank"

And there you have it. Everyone can go home now."

ricko

The only money trail today, leads to the banks. Cheers, RickO

BAJJERFAN

<< <i>

Many Large corporations have record amounts of cash on their balance sheets but they are not hiring or expanding with it, they just sit on it. >>



It seems reasonable to believe that they really don't have any good ideas about how to invest/reinvest all of that extra cash.

Icollecteverything

Well I did get a cheap mortgage rate and then refinanced even cheaper. But it was pretty scary buying a house 5 years ago. My wife had her pay cut just like everyone where she worked or they lost their job. Now I see fed employees complaining about the sequester and getting job cuts.

The quote by Bernanke about not literally printing money is funny/scary. Unbacked Paper is bad enough, now its all just electronic blips. Reminds me of the South Park episode where the father convinces his kid to start a savings account. And.........It's gone.

So unemployment is getting a little better but it's still high. Still records on food stamps. Wages are pretty stagnant. Where did all the money go? What happened to trickle-down theory?