Right, and they buy those bonds in two ways. They either give the seller—the bank or the financial institution—a deposit at the central bank, or they convert it right into paper currency and literally print it. That means more dollars chasing fewer goods and raising prices.
The defenders of this money printing claim that there's nothing we can do about inflation. They say that everybody is suffering, but that is actually not true. There are many countries that are not experiencing inflation. I point, for example, to Switzerland. Switzerland is smack dab in the middle of Europe. It has the same supply chains, the same pandemic and the same geography, and yet I have the data here for Switzerland's inflation: it's 1.5%. Europe has inflation of 5%, which is three times higher.
Why is it that Switzerland has a third of the inflation of the surrounding countries? Do you think, Mr. Cross, that it could have anything to do with the fact that Switzerland's budget deficit is only one-third of the average eurozone budget deficit as a share of GDP?