If you, like me, enjoy the occaisional econ geekout, you might enjoy this article by Ben Bernanke on the Fed's options for controlling deflation. (IE, "printing money")
It explains, among other things, why deflation causes interest rates to skyrocket:
To take what might seem like an extreme example (though in fact it occurred in the United States in the early 1930s), suppose that deflation is proceeding at a clip of 10 percent per year. Then someone who borrows for a year at a nominal interest rate of zero actually faces a 10 percent real cost of funds, as the loan must be repaid in dollars whose purchasing power is 10 percent greater than that of the dollars borrowed originally. In a period of sufficiently severe deflation, the real cost of borrowing becomes prohibitive. and possibly why the Fed has been buying back so many T-bills lately.
I was wondering about those Fed T-bills buy backs were all about:
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