Tuesday, May 14, 2013

The FED's Goals

"The Fed’s goals are to maintain nominal interest rates in the range of zero to 2% while seeking inflation in the range of 4%. The result will be negative real rates that encourage borrowing and an inflation scare that stimulates spending. The combination of lending and spending should increase velocity which, when combined with the already ample money supply, should expand nominal GDP in such a way as to ease the real burden of government debt and reduce the government debt-to-GDP ratio. This policy of slow, gradual inflation and negative real interest rates pursued over a ten to fifteen year period is considered an effective way to erase the burden of government debt without hyperinflation or default."

- Excerpt from Jim Rickards submitted testimony as a witness in the Senate Banking Committee’s Subcommittee

Long-Term Food Supply - WiseFoodStorage.com