Doug writes:
>
> On Oct 13, 2008, at 2:20 PM, ulisse mangialaio wrote:
>
>> will the bailout generate inflation? have all the central
>> banks'injections of liquidity generated inflation?
>
> I looked at some of the countries with big banking crises and bailouts
> - Sweden, Norway, Japan (well, sort of a bailout), and Korea. In all
> four cases, inflation declined. My guess is that the deflationary
> effects of a credit crunch outweigh the inflationary impulse of all
> that injected liquidity.
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The falling gold price supports your view.