The Price of Easy Money: A Decade Later

During my undergraduate studies, I presented at an undergraduate research conference. It was 2010 and shortly after the housing market collapse, the bank bailouts, and the automotive bailouts. I was a philosophy major, but I was presenting on the topic of monetary debasement and inflation, and I warned that the push for “quantitative easing” would only delay the inevitable pain and would, in fact, make it much worse. At the time, I was the only voice at the conference making such claims. All of the other economic presentations by economics majors talked about the miracle of quantitative easing and loose monetary policy. I was the lone voice, and people seemed confused by my simple but clear message. Of course, I wasn’t saying anything new. I was simply conveying the message that the Mises Institute has been spreading for many years. 

Now, years later, we are seeing the results. As this article by Ryan McMaken says:

“It didn’t have to be this way, but ordinary people are now paying the price for a decade of easy money cheered by Wall Street and the profligates in Washington. The only way to put the economy on a more stable long-term path is for the Fed to stop intervening to keep pumping liquidity to the regime and its allies. That would mean a return to a falling money supply and popping of economic bubbles. But it also lays the groundwork for a real economy—i.e., an economy not built on endless bubbles—built by saving and investment rather than spending made possible by artificially low interest rates and easy money.”

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