But low rates are engendered either naturally from increased savings or artificially by printing money.
It is as if we believe that by printing money we can remove hard budget constraints.
Financing government by printing money inevitably leads to higher inflation and all of its associated problems.
The first major central bank to start aggressively printing money was the US Federal Reserve.
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Basically, governments surreptitiously default by printing money in order to pay off their debt.
Longer-term, with central banks printing money it is ultimately inflationary, which is supportive to gold.
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But printing money to pay interest and principle on loans is not debt service.
Second, currency boards require the government to give up seignorage the implicit profits from printing money.
The third is that the deficit can be financed by printing money with no real consequences.
There will be a strong temptation to paper over the loan problem by printing money.
One unless is that the ECB can simply start printing money and monetise all the debt.
By printing money to help the current deficit crisis even as the government institutes austerity measures.
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Bernanke was noticeably reticent in explaining how printing money is supposed to reduce unemployment.
"In the old boom days, when we were printing money out here, nobody cared, " he said.
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Yet if creating prosperity were as simple as printing money, no country would be poor.
And the government, which last year fuelled inflation by printing money, cannot afford to provide relief.
And he was printing money willy-nilly to keep the economy afloat through cheap loans.
Facing a fiscal chasm, the government will have to slash spending, and resort to printing money.
The government's foreign debts go unpaid and its domestic ones are met by printing money.
Most people (outside of Washington) understand that printing money dilutes the value of the currency being printed.
But printing money to make good on such guarantees is not the job of any government anyway.
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There was a time in the markets when getting in on an IPO was like printing money.
The official debt, after all, can be wiped out in real terms by printing money and raising prices.
Printing Money to Save the W orld by Bill Bonner originally appeared in the Daily Reckoning.
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Rather than reduce spending or institute temporary borrowing to cover the shortfall, the government resorted to printing money.
Unlike most European countries, the United States has the luxury of printing money and borrowing almost at will.
Such dilemmas will continue throughout Asia so long as Japan and other developed countries keep printing money without end.
Now we have virtually the entire developed world printing money out the wazoo.
Now the Fed is artificially stimulating the economy by printing money at a rate the world has never seen.
Printing Money Causes the Wrong Kind of Inflation by Bill Bonner originally appeared in the Daily Reckoning.
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