US Economic Crisis 2008

Citigroup Bailout Will Lower Dollar’s Value

How will the US pay for these bailouts? They will issue T-bills. This has the same effect as printing of money. It creates additional credit and credit expands the number of dollars out there by a factor of about 10. When you deposit cash, it allows banks to about ten dollars to every dollar you deposit. That is if they banks will loan it. Right now, they will not do it so the lender of last resort is the government and the government is going to loan and loan big.

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