U.S. Senator: Printing Money Will Lead to More Severe Inflation

In an interview with Reason.com, Sen. Tom Coburn explained how the low interest rates and lack of hyperinflation now was a harbinger of things to come:

reason: So looking at low interest rates is missing the larger point?

Coburn: It’s missing two important points. One is that we’re the best-looking horse in the glue factory. The second point is that just because we have low interest rates doesn’t mean they’ll always be low. When you’ve printed $3.6 trillion worth of money—right now it’s printed but it’s not in the economy, it’s sitting on bank assets listings and the Federal Reserve asset listings—what happens is when that money starts moving, when the velocity of that money starts moving, you’re going to see 15, 18 percent inflation. 

So the debt bomb is two things: short-term is deflationary, long-term is highly inflationary. And that has a real meaning to anybody that’s living in our country. If you’re my age or less, and you have socked away something for your retirement, the purchasing value of that goes away.

For the full article, go here.