Are we going to get socked with inflation in the near future?

The big question with all the big money spending and the currency printing presses running to keep up, the next question is the fear of inflation or even hyper-inflation. Good question, especially with these unsure times. The Motley Fool had an excellent article explaining liquidity and why inflation is not a concern in the near future.

A direct quote from the article was “To understand why printing money may not generate inflation, consider that money may also be destroyed in the collapse of debt securities, clogged derivative markets, and tightened lending standards, as well as vanishing bank capital.” The article goes on to say it will take some time to clean the mess up, not saying inflation will not happen in the future but most unlikely, until they can “unclog” the system and de-leverage the banks to realistic levels, which won’t be soon and won’t be easy.

For the full read, copy and paste the following,

http://www.fool.com/investing/general/2009/05/29/forget-about-inflation-in-2009.aspx

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~ by debt2dreams on June 1, 2009.

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