Whip Deflation Now: The true purpose of QE3

The true purpose of QE is to whip deflation. That’s because politicians and central bankers are petrified of allowing another deflationary depression such as the Great Depression of the 1930’s to taking hold.

Back in October 1974 US President Gerald Ford was concerned about inflation declaring it “public enemy number one”. Ford started a grassroots movement to combat inflation, encouraging people to save and be disciplined in their spending habits. Those who supported the measures were encouraged to wear “WIN” badges, which stood for Whip Inflation Now, in the hope that it would evoke the kind of solidarity and voluntarism symbolized by the V-campaign during World War II.

Thirty eight years later things couldn’t be more different. Far from being encouraged to save and be disciplined in our spending, central bankers are doing their best to penalise saving and get us spending again. That’s because the threat today is that of deflation.

Perhaps, then, Ben Bernanke, Mario Draghi and Mervyn King should start wearing Whip Deflation Now (WDN) badges?

Whip Deflation Now (WDN) badge

 

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