Anonymous
Anonymous asked in Social ScienceEconomics · 1 month ago

Are the trillions of dollars being printed to pay for the stimulus causing the dollar to lose value? If so, will this loss be dramatic?

I'm considering selling or renting my home. If the dollar is about to be devalued I'd rather keep my home and rent it instead.

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  • 1 month ago

    The significant monetary and fiscal stimulus that has been injected into the economy is controversial, and opinions differ about how much inflationary pressure this will put on prices, and how it will affect the value of the USD. 

    All I can say is so far we haven't seen a loss in value or buying power. Inflation generally requires a surge in demand for goods and services, and that's not happening (at least not yet). If we see a post-COVID surge in the economy, we might have more inflation. 

    CPI Inflation in the US is only at 2.2% for 2020, which is pretty manageable. The USD value in forex markets has declined a bit over the past year, but it's currently down only about 3% from this date last year. 

    If I were in your position, and considering whether to sell a home or keep it as an investment, my main consideration would be what I think the local real estate market is going to do, and how much it might appreciate in value (or not). 

    Source(s): I'm an economist.
  • Anonymous
    1 month ago

    No

    The hypothesis that money-creation always will be nullified by inflation is incorrect.

    People who get a stimulus-cheque will spend it on things they need or pay off debts. They are not suddenly going to pay 10 bucks for a loaf of bread

  • 1 month ago

    Biden apparently doesn't care about inflation.  I would be worried if I was in your position too lmao

  • Oiy
    Lv 6
    1 month ago

    You might seethe fund rate which is controlled by the FED under the name of monetary policy. It is now approaching null. How far can it go more? If you don‘t know that the rate is related to the value of the dollar, you might just stay as home and practice the lockdown.

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  • Petter
    Lv 7
    1 month ago

    Yes, it is. I'm surprised there hasn't been a dramatic change already or at least some kind of "adjustment". This will only make the crash even bigger, when it happens, imho. I mean, the whole economic sector just seem to stick their head in the sand and pretend the Covid-19 never happened.

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