[mattduke]

a surprising number of high-profile economists, on both the left and the right, think that it’s time for the Fed to try one more extraordinary measure: injecting the economy with a healthy dose of inflation.
Odd as that may sound, it’s actually not a crackpot concept.

Get a load of this one.
http://www.newyorker.com/talk/financial ... z10m8l1BkV

[dolanbaker]

a surprising number of high-profile economists, on both the left and the right, think that it’s time for the Fed to try one more extraordinary measure: injecting the economy with a healthy dose of inflation.
Odd as that may sound, it’s actually not a crackpot concept.

Get a load of this one.
http://www.newyorker.com/talk/financial ... z10m8l1BkV

Great! Eliminate the debts by wiping out savings, but isn't that what they've been trying to kick-start for the past few years.

[BasilBoy]

This article hits the nail on the head. Right now, inflation could be a good thing...but it all depends on what we do with inflation. If we continue playing financial games and consuming more oil (which I think has a high probability), then we'll simply be kicking the can down the road. However, if we use it to develop a real, sustainable economy (i.e. renewable energy, efficient transportation, local farms, less imports, etc.), then maybe we can avert a total collapse...

[Tyler_JC]

The trouble is that inflation doesn't fix our long term problems.

The Social Security Trust fund, assuming we even want to pretend it's a trust fund, would see its value melt away. At the same time, future Social Security payments which are indexed to inflation, would grow. From the prospective of the Social Security program, we would be significantly worse off.

Future medical costs would also cost more, no amount of inflation is going to magically create more doctors. If anything, higher inflation would give doctors and medical device makers even more pricing power, leading to even higher medical costs. From the prospective of Medicare and Medicaid, we would be significantly worse off.

The value of the entire bond market would plummet in a high inflation world as yields rose and prices fell. Pension funds, insurance companies, money markets, and other major players in the financial industry could be wiped out. Someone who has their entire retirement savings in an annuity or "safe" treasury bonds would be ruined if inflation increases. So our retirees would see their living costs soar AND their savings drop at the same time. In other words, poverty among the elderly would increase. I don't see that as a good thing, do you?

For every winner in a high inflation world, I can point to 5 losers.

[americandream]

The problem is that the measures will be aimed at heating up the risk sector in America and the West generally (not that they need much encouragement with Chinese investments holding the fort), not encouraging warm fuzzies.

This article hits the nail on the head. Right now, inflation could be a good thing...but it all depends on what we do with inflation. If we continue playing financial games and consuming more oil (which I think has a high probability), then we'll simply be kicking the can down the road. However, if we use it to develop a real, sustainable economy (i.e. renewable energy, efficient transportation, local farms, less imports, etc.), then maybe we can avert a total collapse...