Flooding market with dollars will devalue your dollars

Liquidity, liquidity, liquidity. All we here about is liquidity. It means banks having money to loan. The government’s solution is to create more dollars and lend them to banks. The downside is that when the government floods the market with dollars, the value of every dollar decreases, and the prices of all goods increases. Your neighbor will be able to get a home equity loan, but you’re paying double for your groceries.

We still do not know if the banks will actually lend out this money. If they don’t, then we have stagflation: money inflation plus a recession.
The stock markets rallied today because of the news of the new dollars. If we return to a new, booming inflationary market like the one we’ve had for the past seven years, your stocks will rise, but your dollars will decrease in value.

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