Thursday, 11 November 2010

Qualitative Encashment - instead of Quantitative Easing

The world has just been told that the American cash printers are going to print, a sum of 600 billion from thin air, and it is called as quantitative easing, wonderful terminology to soothe the nerves, and calm the mind, but crash the money markets across the world.

It has always been the policy to print money when the government needs it, but there must be a backing of solid gold in the reserves for it, with out it the printed money looses face value, one does not need to be an economist to understand this.

If one creates more jobs, gets international market for the products, increase tourism and ease in the mind to travel around the land for the tourists, and all the other things with in the government, then there would be another kind of QE 2 called as Qualitative Encashment, where the quality of the American money gets boosted and gets more standardized, and with it the American dollar stays at its place at the podium.

Will it be possible? or may be the banking folks have decided to dump the Dollars.

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