This Bubble's Got Legs • Hacker News Board

Re: This Bubble's Got Legs

#111

Post by crimsonalucard » Sat, Sep 10, 2016, 7:08 AM UTC

rtpg wrote: post #2

So my vague understanding is that QE and stuff is technically printing money, but the resulting money isn't really being used for anything. Is a bubble a bubble if the extra bubbly-ness is from stuff that doesn't get used? EDIT: actually, answered my own question. QE raises asset prices (even if the sellers aren't really doing anything with the money), and at one point people will be like "wait, none of this is worth…

If printed money doesn't get used it's as if it was never printed. It is the action of using this money that causes prices to rise.

Nobody will just print money and leave it in a vault.

Re: This Bubble's Got Legs

#112

Post by forgetsusername » Sat, Sep 10, 2016, 12:22 PM UTC

cloakandswagger wrote: post #101

forgetsusername wrote: post #93

Earlier quoted context omitted.

> The financial problems originated with excess debt, but debts that are so large that they cannot be paid back - will not be paid back. So in other words, you believe that financial problems are caused by too many assets? Because that's how a balance sheet works.

Nice attempt at applying your Econ 101 knowledge, but a balance sheet where the "assets" are made up of meaningless fiat created by debt instruments does not work like that.

>are made up of meaningless fiat created by debt instruments does not work like that

Then the debt is equally meaningless. Maybe you should try applying financial principles, rather than reading Zero Hedge.

Re: This Bubble's Got Legs

#113

Post by [deleted] » Sat, Sep 10, 2016, 12:22 PM UTC

cloakandswagger wrote: post #101

forgetsusername wrote: post #93

Earlier quoted context omitted.

> The financial problems originated with excess debt, but debts that are so large that they cannot be paid back - will not be paid back. So in other words, you believe that financial problems are caused by too many assets? Because that's how a balance sheet works.

Nice attempt at applying your Econ 101 knowledge, but a balance sheet where the "assets" are made up of meaningless fiat created by debt instruments does not work like that.