The Coming Economic Collapse, Currency Induced Cost Push Inflation/Hyperinflation, Weimar Germany, Euro Collapse,
Zimbabwe Hyperinflation, Survival in Economic Collapse, World Economic Collapse, Dollar Collapse,
What Would Happen If the Economy Collapsed,The Coming Economic Depression.
Gold and Silver Will Protect Your Wealth.
Posted: Apr 26 2011 By: Jim Sinclair Post Edited: April 26, 2011 at 10:17 pm
Filed under: In The News
Thought For The Afternoon
Will they or will they not continue QE is not the question. They must, be it through the front or back door. The future of the dollar is what you need to know if you are to navigate this, the most violent upcoming part of the gold drama.
The dollar situation is damned if you do and damned if you don’t. A suspension of QE is negative MOPE that would impact the equity market, therein destroying the liquidity rally from March of 2009. The recovery is not getting serious traction regardless of the bliss of the media.
The US dollar would be hit hard by a collapse of this modest recovery that a suspension of QE would mandate. If QE is to continue, either front or back door, the dollar will remain under pressure.
Forget the media and blog commentary. The future of gold is all in the dollar. The US dollar has no future under present conditions.
Regardless or Bernanke’s personal qualities, the fact is that it doesn’t matter what he does next. Whether or not he issues QE 3, raises interest rates, references inflation differently, or what have you is irrelevant. We will see some kind of Crisis in the near future because of his policies. If he raises interest rates, the debt market and derivative implodes. If he launches QE 3, the Dollar collapses and trade wars erupt. If he doesn’t launch QE 3, the stock market collapses.
It appears economist Paul Krugman thinks the budget and the economy are not in that bad of shape because he thinks the dire warnings are overdone. In his latest Op-Ed piece this week, he said, “When I listen to current discussions of the federal budget, the message I hear sounds like this: We’re in crisis! We must take drastic action immediately! And we must keep taxes low, if not actually cut them further! You have to wonder: If things are that serious, shouldn’t we be raising taxes, not cutting them?” (Click here for the complete Op-Ed post from the New York Times.) Yes, that’s right, Mr. Krugman wants to raise taxes just as inflation in food and gasoline are heating up. It is hard to understand why a Nobel Prize winner in economics wants to raise taxes in the middle of the worst economy since the Great Depression. He doesn’t just want to raise taxes on the wealthy, but on the middle class as well. He goes on to say the plan he backs, “. . . also calls for a rise in the Social Security cap, significantly raising taxes on around 6 percent of workers. And, by rescinding many of the Bush tax cuts, not just those affecting top incomes, it would modestly raise taxes even on middle-income families. . . .And the proposal achieves this without dismantling the legacy of the New Deal, which gave us Social Security, and the Great Society, which gave us Medicare and Medicaid.” So, in Krugman’s eyes, we should continue going broke over the funding of Medicare and Medicaid?
Mr. Krugman also points out that taxes in the U.S., “. . . are much lower as a percentage of national income than taxes in most other wealthy nations.” Who are those “other wealthy nations?” Japan, France, Spain, the UK? What Krugman conveniently leaves out is there is a sovereign debt crisis going on with many “wealthy” western countries. Many are broke and are in severe budget crisis because of their cradle to grave nanny states. Right now, the economy is in such bad shape that a record number of people require government handouts to survive. A USA Today article said yesterday, “A record 18.3% of the nation’s total personal income was a payment from the government for Social Security, Medicare, food stamps, unemployment benefits and other programs in 2010. Wages accounted for the lowest share of income — 51.0% — since the government began keeping track in 1929.” (Click here to read the complete USA Today article.) I don’t see how we can be in a recovery if record numbers of people require government handouts. The last thing these people need are tax increases, on top of crushing inflation that will only get worse.
Inflation goes hand in hand with money printing, and America is printing dollars at an alarming pace. Recently on his website, Congressman Ron Paul said, “Even the most conservative budget that has been proposed by Republican leadership requires raising the debt ceiling by an additional $9 trillion by 2021. This demonstrates absolutely that no one in power right now has any real intention of addressing our spending problems or paying down the debt. They simply expect to continue to borrow and run up more debt forever, without limit. Yet they always imagine our dollar will have value no matter how many we print. This expectation is foolish and naïve. I guarantee that those buying our debt are not foolish and naïve enough to go along with this charade forever.” (Click here for the complete Ron Paul post.) More…
Ben lies: we're sheep; No more; and by being sheep we suffer the heart-ache and the thousand pricing shocks unmeasured by the CPI, 'tis a consumer tax, despite what you had wish'd. Ben lies; we're sheep: living a dying dream: Aye, there's the rub; when fleecing sheep what jobs may come when we have scuttled all their buying power?
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