"Helicopter Ben" nickname does honor to

And again the U.S. government is investing 800 billion into the banking system. This time, however, the aid is free.

Why should we now already 800 billion dollars in the American banking system be pumped?

The Bush administration this time had no other choice. Freddie Mac and Fannie Mae, the two largest mortgage banks in the country, are de facto nationalized early September. Since then, the government guarantees all the debts of these mortgage giants, which together half of U.S. mortgages are financed.

Fannie and Freddie have many bad loans on their balance sheets and credit crisis by the dozens or perhaps hundreds of billions of losses. Alone in the third quarter, when the real crisis was only beginning, she joined members a loss of over 50 billion dollars.

It let fall of the banks is not an option, because then all debts to the government rightly so. To prevent this and also to ensure that Freddie and Fannie continue to provide mortgages - given the free fall of the house-price is sorely needed - Freddie and Fannie have their bad mortgage loans are redeemed.

The U.S. government is actually paying 600 billion to its own banks? That sounds absurd.

No. That does not exactly public. In that case, the budget deficit to 600 billion increase, and taxpayers will suffer. Now pay the Fed, the American System of Central Banks. Those finance the takeover of the debt by printing money.

Bijdrukken just money? Just as in Zimbabwe or the Weimar Republic?

They were indeed their economic problems to tackle money by the press ever harder to run. The result was that inflation quickly ran into the thousands of percent.

The U.S. currently do not be afraid of a sharp inflation. The risk of deflation, a fall in prices is much larger. Deflation also has a lot desastreuzer effect. If prices fall, wages will fall, allowing the U.S. debt mountain proportionately only widens.

As long as deflation threatens, central banks may therefore unlimited money the machines running.

According to Ben Bernanke, the current Fed president, well. Deflation is never a problem, he concluded in 2002. If necessary step you with a stock of banknotes in the helicopter and that you sprinkle over the country, saying the prices go up. Bernanke owes it to his nickname Helicopter Ben.

Now equally seriously.

This is serious. You can also another way to determine that the step of Americans do not have to be so unwise. The credit crisis, all banks to shorten their balance sheets. In plain English: they borrow less. This is in essence that they have money to the destruction. This has stalled the flow of funds, the lubricant of the economy and threaten the economic engine to run all the way down. There is so much to say that the Fed directly inject oil into the system and not as usual through the detour of interest rate cuts - which now barely more help.

The Fed has also already decided to print 200 billion to that - through the banks - to students, car buyers, small businesses and credit card holders can be borrowed. It takes the Fed, in essence, the money-creating role of the banks.