Bizarre Proposals for stimulating the US Economy

As unbelievable as it sounds, some top Federal Reserve officials have come up with a REALLY bizarre proposal for stimulating the US economy: According to Michael Snyder, what they really propose to do is to purposely raise the rate of inflation so that Americans will stop saving so much money and will start spending wildly again. If the inflation rises a couple of percentage points, but consumers are only only earning half a percent - or less - on their savings accounts, there will be an incentive for consumers to spend that money as the value of it deteriorates sitting in the bank. Several decades ago, Americans typically saved between 8 and 12 percent of their incomes, but over this decade the personal saving rate got down to near zero a number of times as Americans were living far beyond their means. Once the recession hit, Americans very wisely started saving more money, and so now the personal savings rate has been hovering around the 5 to 7 percent range. This is well beyond historical levels, but the folks at the Fed apparently are eager for Americans to pull that money out and start spending again.

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