Council of Canadians - credit question

Max Sawicky sawicky at epinet.org
Mon Apr 10 10:42:00 PDT 2000


. . . Money arises in exchange. Certainly there's an extension of credit involved, but there has to be some real sector involvement or the money is going to be worthless. Central bank extensions of credit without any offsetting expansion in productive capacity will be inflationary. Sometimes that appears as a rising CPI; sometimes as a wacky stockmarket. Doug

oh yeah. And another thing.

An extension of credit with no offsetting expansion in productivity capacity may be inflationary, but the money is far from worthless on that account.

mbs



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