The Effects of Monetary Inflation on the Economy

Low interest rates that drive this policy act as false signals, enticing individuals to overconsume and businesses to over expand. The top 1% of income earning households are dramatically outperforming the remaining 99% that are exposed to the real economy. Easy money explains the economist Henry Haslett, creates economic distortions,. It tends to encourage highly speculative ventures that cannot continue except under the artificial conditions of low interest rates which give birth to them.