as The Government Generates New Money Without Increases in Real Productive Capacity Let’s talk about the velocity of money! The speed at which money flows through the economy is often tied to speculation about the future of inflation. It may be important, but it is no longer a big factor when it comes to inflation. We have entered a cost-push inflationary cycle and these tend to be self-feeding. This translates in to more inflation ahead.
Today, small businesses are suffering the most pain of cost increases since larger enterprises have a lot more ability to get cheap funding. More small businesses forced to close may result in stagflation in this economic cycle rather than deflation which is normally associated with downturns. This is a reason for concern on both the employment and inflationary front. Not only do small businesses employ a huge number of people but they generally resist raising prices due to close relationships with their patrons.
Poster Comment:
Alternatively, they could issue a non-interest-bearing currency like Lincoln's Greenbacks.