CNBC:

When the Federal Reserve policymakers decide on interest rates Tuesday, investors will probably look one step beyond their decision, to gauge how much money will the Fed be willing to print once it is out of rate ammunition.

Rates won’t likely hit zero Tuesday, but this could be unavoidable in the near future, according to strategists and market experts.

"Rates will fall close to zero. Everywhere," Hugh Hendry, chief investment officer and partner, Eclectica, told CNBC.com. "The central banks will be forced to take them to zero because of the widespread disruption in society, for job losses."

And nations may have to let them stay there for a long time, while finding new ways of easing policy even further.

The Fed has already moved on from using interest rates as a monetary policy tool and the next fed funds target rate after the Dec. 16 meeting is "almost academic," ING economist Rob Carnell said.

The Fed’s balance sheet has expanded to more than $2 trillion, made up of collateral received in exchange for liquidity provision, or loans of Treasurys.

"In our view, this is, for want of an alternative description, ‘printing money’," Carnell wrote in his research. "And our assumption is that there is more of this to come."

Besides mortgage-backed securities and asset-backed securities, the Fed will purchase Treasurys, corporate paper and even stocks to provide much needed cash, he predicted.

"The Fed’s only option is effectively to ‘print money’ by crediting the reserve balances held by commercial banks at the central bank," Ashworth also said.

"Nobody really knows how these policies will work out," Stoeferle said. "If it were another country, the U.S. should probably declare bankruptcy."

My comment: I think we are entering the end game with respect to the inflation/deflation debate and gold seems to be agreeing. It goes without saying the politicians will print any amount of money in their attempt to stave off deflation. They will cause inflation and possibly hyper inflation. Really though they have no choice as a deflationary depression means revolution and end of the current power structure. Creating a hyperflation takes some time so at least Obama can play president for awhile. At least until people get fed up with the hyperinflation and toss him and the whole rotten bunch of them out.

John Polomny
The Real Deal