printTrashed By “W,” and his “worthy,” wastrel successor, the once-solid dollar may soon be dumped as the world’s reserve in favor of a basket of fiat currencies.
“The U.S. deficit is so huge. This is why all countries, particularly East Asia, are concerned because we hold a lot of these assets. What happens if the U.S. dollar falls 40 percent? Many central bankers will be losing huge amounts of money.”
“Central banks hold their reserves in a variety of currencies and gold, but the dollar has dominated as the most convincing store of value — though its rate has wavered in recent years as the United States ran up huge twin budget and external deficits.”
Tough love indeed.
Bernanke (and Greenspan) can’t be this dumb. He has to know what he’s doing is economically destructive. If creating money from nothing was the path to prosperity, they would have eradicated scarcity long ago. Zimbabwe would be the economic powerhouse!
Alas, wealth cannot come from a printing press or computer keystrokes at the Fed. It is a long and steady process requiring trade, division of labor, capital accumulation brought about by deferred consumption (savings), private property and the rule of law. We long ago ceded all of these things in a quest for “fairness” and outright theft of the productive for the benefit of the slackers and the political parasites.
If people haven’t figured out by now that we are being ripped off, they soon will, and it will be a very painful lesson indeed.
And on top of everything, today it’s announced the Fed will just create another Trillion dollars out of thin air.
The Chinese aren’t buying, they know we can never pay them back.
So the Fed is ‘buying’ treasury bonds. It has already doubled the money supply in the last year alone, now this.
The dollar is toast. Bernanke thinks once he lights the fires of inflation, he can pull his kindling out of the inferno in time to save the dollar — probably with usurious interest rates. Well, the last time it took rates over 20%. This time, no amount of interest rate is going to save it.
I hope I’m wrong, but I don’t see any way out. The worst thing is, the paper money giveaway destroys the honesty and worthiness of our society.
“If people haven’t figured out by now that we are being ripped off, they soon will, and it will be a very painful lesson indeed.”
I think people of all generations are starting to understand, big time, that they are being ripped off. The question that remains is will they have the discernment to ask the right questions and come to the right conclusions about who it is that is ripping them off. I never cease to be amazed at how skillful politicians are at convincing people that the real culprit is anyone but us (note the AIG bonus outrage). I do have optimism however. Being constantly bombarded with so much competing information I tend to think the younger generations have had to develop better bullshit detectors by necessity. At least I hope that is true.
This is why I put most of my money in bullets.
Actually, it is getting worse than an exponential. Dubya doubled the national debt in 8 years and the Messiah is going to do it in 4. At this rate, the point of infinity comes in 2017. Funny thing is how some people have been writing how they have given up $ 9 lunches and now brown bag their lunches – – I have been used to living well within my means and recommend that people learn those skills for the upcoming crises because there is no escape from a dollar that is “too big to fail”.