FED Printed 614% More Money Than During 1980 Recession

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covid recession

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This article was originally published by Austin Litman on Proofofwork.ca

Let’s compare the 1980 recession to today’s situation. Is it better or worse? 

First, there are 3 facts you need to know.

  1. The value of the dollar goes down when more dollars are printed.
  2. Inflation is caused by the value of the dollar going down.
  3. Higher interest rates lower inflation but destroys the economy.

In 1980-1982, the US printed $273 billion.

In 2020-2022, the US printed $6,030 billion (~$1,675 billion in 1980 or 614% more).

The US printed 614% more than it did during the 1980 recession, adjusted for inflation.

Data from the 1980s:

  1. 1980 → 1982: $273 billion printed
  2. 1980 → 1982: avg. inflation rate = 11.94%
  3. 1980 → 1982: interest rate peak = 20%

Data from today:

  • 2020 → Oct. ‘22: $6,030 billion printed (~$1,675 billion in 1980 value, or 614% more)
  • 2020 → Oct. ‘22: inflation rate = 6.06%
  • 2020 → Oct. ‘22: interest rate = 3.15%

So we know based on the data, inflation still needs to go up given that we printed more than the 1980s. So do interest rates in order to solve the problem of a higher inflation rate. Both have been steadily increasing since getting the data on this in October. But we are not even equal to how bad it was in the 1980s. And we printed 614% more this time. So it seems this recession will be worse than the 1980s? :/

Important data:

https://www.officialdata.org/us-economy

https://tradingeconomics.com/

https://fred.stlouisfed.org/series/M2SL

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