Donuel, inflation will occur as long as the money supply increases. The money supply will increase as long as the banks are allowed to create new money out of thin air by lending money that doesn't exist until the moment they lend it and by charging interest on their loans.

In order to prevent inflation you must maintain a given (and limited) number of dollars in circulation...tied to real assets that are held in reserve to back them...real assets such as gold, silver, etc.

If you simply let the major lending institutions create new money out of thin air...which they do every time they make a loan...then you WILL have constant inflation and your dollars will proportionately keep losing their value.

And the bankers will get very, very rich...UNLESS so many people become unable to repay their loans and the interest that the whole Ponzi scheme blows up like an overinflated balloon...and that's what is beginning to happen now.

The Bailout intends to pardon and reward the bankers for their own usury by bailing them out of the mess that their creation of vast amounts of fictional money has created in the first place. This is a case of rewarding the fraudulent for the fraud they themselves perpetrated on the general public.