| jun 28 2009 | | Dollar Crash? | By all fundamental indicators the dollar should be in the toilet. I have been warning that because of the prolifragate US economic policy they, like a lot of western nations are driving their countries off a cliff. Watching what has unfolded in the last few months I am revising my time scale but not my conclusion.
Ben Bernanke is doing as he promised and inventing money. The Fed has a monopoly to invent money which they do to provide for government spending. However, he is now ‘making’ money to buy up the debt that foreigners are no longer comfortable buying. They have enough and are watching it get inflated away at a fast pace. The new policy of Quantative Easing is a euphemism for buying the debt you create with pretend money that you create. Nice game if you can get in on it.
Therefore, it is my contention that as Ben can produce a trillion a month for as long as the Ponzi scheme runs, he can delay the crash in the dollar. But as soon as someone notices that the Emperor has no cloths, and the bigger the holder of debt the less they want to acknowledge naked Ben, then the whole scam comes crashing down. I think we can go on for a year or three, which gets us nicely to 2012 but that’s another story.
So they can manage the value of the dollar down to a devalued rate that lessens the overall debt obligations but only by actions that guarantee a worse result than if they had the back-bone to address the mal-investment now.
Ignore the short term noise of the market and accumulate gold.
| | Respond... |
|
|
 |
|
