Quote:
Originally Posted by inapcha
1) When Bear Sterns fell, i read that the Fed flooded the US economy with fresh money. Where does the money go? How does this help?
2) Few months back Ron Paul said "Fed is printing more money to keep the interest rate low". How does interest rate go low with more money? Are the two questions related?
(Source : YouTube - CNBC: Ron Paul's question makes Ben Bernake's voice quiver - 00:58)
All i understand is, with more money in the system, inflation climbs still further!! |
Hi inapcha,
My apologies for the delay in reply I had missed this post earlier.
If you visit my free basics of trading video course at the link below, you will find under module 8 several lessons that give the answers to these questions:
InformedTrades : Learn Trading. Trading Education. | - Basics of Trading Course
Start with the lesson on "physical policy and the business cycle" and then and let me know if the videos that follow do not answer your questions.
Best Regards,
Dave