tfast wrote:
>>* Why wouldn't the money's devaluation be (in principle) the same as
>>injecting new money into the supply?
>
> 100$ devalued by 10% is 90$.
Excuse me, I mistyped; I meant the opposite of devaluation. Since during the recession, "Few felt they could go out but many wanted to babysit." That would then imply that the money could buy extra babysitting hours, and that would be equivalent to injecting money into the system.
But maybe that would require planned coordination, as the real issue could be that in deciding to go out, you're weighing the value of your night out vs. decreased ability to go out in the foreseeable future. And you can't expect that others would strike the same bargain; the increase of money supply could be seen as a coordinating signal which essentially strikes that bargain for everyone... hrmm...
Tayssir