By Nigam Arora & Dr. Natasha Arora

Prevailing Wisdom

Nobody argues the following two facts:

  • The Fed has printed trillions of dollars.
  • The U. S. government is borrowing trillions of dollars.

The prevailing wisdom is:

  • Money printing by the Fed is a free lunch, i.e., the Fed can create money out of thin air with no consequences.
  • The U. S. government borrowing trillions of dollars is also a free lunch because there is no need to pay it back in the foreseeable future.
  • The Fed will manage to keep interest rates low for a very long time.
  • The inflation that we are seeing now will be transitory.