Eric Sprott's Latest Commentary: Ignoring the Economically Obvious

From market folly
January 28, 2013 - 1:56pm

Eric Sprott, founder of Sprott Asset Management, is out with his latest 'markets at a glance' outlook.  Entitled "Ignoring The Obvious," the piece points out how the Fed's actions are just masking real problems such as high unemployment, exploding government liabilities, and how money printing doesn't achieve anything constructive. Sprott writes: "The purpose of asset purchases by the Fed might no longer be improvements in the real economy, but rather a more subtle financing of U.S. government deficits. However, in the long run, expanding the money supply inevitably leads to inflationary pressures. Luckily for the Fed and the U.S. government, there is so much slack in the labour market that inflation might be years away. And, if we are right about the long run unemployment rate being structurally higher, then the Fed has all the room it needs to continue Quantitative Easing (QE) t...

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