world economy full of cash

T

techman1

Guest
A lot of commentators have been commentating on the flood of liquidity and cash sloshing around the world economy. This has resulted in alot of assets particularly houses soaring in price. The enthusiasm seems to be now falling away from houses. Where do people think the money will flow to next. Will it be left in cash or will producers start looking for more cash for their products forcing up inflation. The world has been protected so far from inflation because China is the Worlds main producer. But the Chinese will inevitably have to push up prices since they are now under pressure from high raw material costs.
 
The theory that there is to much cash floating around the globe isn't new.The only marxist professor for economy in Paris/France-however one looks at his political views-has published a remarkable book this year that picks up the idea.He figured out that there is a surplus of $50 billion looking for a "home".He means that this money is disturbing predictable economical growth by floating in and out of markets on the search for a "valuable" harbour, a place where it can stay and make profit.Since there is " to much " of it it hinders it self of becoming profitable. To many dogs will kill the rabbit.
 
$50 billion? Peanuts. You can't even run a decent war on that now.

Was he talking about just the French economy?
 
The world economy.As he said this money has no home,it is "jumping" without apparent reason from place to place.Causing damage where it apears.Most states have a smaller budget for the entire budget year.
 
An US " trillion " is a rest -of -the -world " billion ". We might be talking about the same thing.Taking gouvernment households/budgets could have been the wrong sample.A budget that is made of non-existing money ( debts that are paid back with debts 'till eternity) can't be compared with real money when one thinks about it. GDPs are fixed to something,but not to existing money.A GDP is existing in numbers , not in bank notes.A GDP reflects the entire turnover of a nations economy, not the liquid cash that is free/unburdened with debt.
When the oil price slipped recently from an all time high ( in numbers only!) it was said that Warren Buffet -hope the name is right-stepped out from the speculative oil game.I think that is what was meant by this marxist professor of economics.Money that is useless to those who own it.(Who could consume a value of 50 trillion/billion dollars ?) So it's shifted around causing damage.Like driving a heavy truck over a bad road .This truck will make it , but the road will be damaged for others to come . Resp. not to come . Since it is to badly damaged.
 
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