Economists only: What is the downside of printing and distributing trillions of dollars in an environment in which inflation is nil and demand is low? Who loses and when? @joshgans
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Those who can not cover their costs at the current prices.
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Owners of real estate and stocks, and people closest to fed money printing will benefit disproportionately— the foundation of continued income inequality .
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Homeowners
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Prices are not raised due to overall demand. Prices are raised due to particular demand. Then more money must be printed to allow people to buy that particular product. Other products then become relatively cheap and their demand increases. It's a cycle.
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Low demand is usually a product of lack of money. Increased money supply will lead to demand stimulus, and from there prices will increase as the demand push exceeds the supply. Businesses will have trimmed their production to meet the low supply for cost reasons.
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It's the other way round. Excess money will chase the price of something up.
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The extra €£¥ would create demand. Isn't that the point of helicopter money?
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The trillions of dollars being added to liquidity has to go somewhere. It will search for a return, any return above the cost of obtaining it, which is close to zero. Stock market, commercial real estate, high yield bonds etc. That drives those assets prices up, beyond normal
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