Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
While the media is flooding us with news about AIG, Dobbs, and the bonus tax... something else big is happening - one we are not hearing about.
The Fed Reserve yesterday, March 18, announced it's buying $1.2 trillion of govt bonds, etc. which in turned weakened the value of the dollar.
If the plan works we may be in great shape. If not, we may face high inflation.
OK, I'm no financial expert. But doesn't that mean our govt is going $1.2 trillion further in debt? Isn't it sort of like robbing Peter to pay Paul? Am I totally wrong here? Well, right or wrong, it had an immediate reaction of further lowering the dollar and a risk of further negativity.....read below.
Quote:
The decision by the Fed to buy government bonds and mortgage-related securities is designed to lower borrowing costs for home mortgages and other types of loans, thereby stimulating economic activity. The central bank, effectively, will print more money to pay for the purchases. washingtonpost.com
Quote:
The US Federal Reserve says it will buy almost $1.2 trillion (£843bn) worth of debt to help boost lending and promote economic recovery. BBC News
Quote:
The new purchases come with risks. They will balloon the value of the assets the Fed holds by about 50 percent, to more than $3 trillion. That could make it tricky for the central bank to draw that money out of the system once the economy starts to recover. The Fed would probably find it difficult to sell such massive volumes of assets, and if it doesn't handle the task adeptly, the nation could face high inflation because too much money would be in circulation. washingtonpost.com
Quote:
March 19:
Quote:
Gold jumped the most in six months in New York after the Federal Reserve’s plan to buy debt weakened the dollar .... “Investors are worried the Fed will print as much money as they need to and this is going to lead to some insanely hot inflation, so they’re out buying gold,” Gold Soars Most in Six Months as Dollar Drops; Silver Climbs - Bloomberg.com
I'm no expert so I'd really like to read more about this but it is hard to find info about it on the net. Did catch it on Glenn Beck. He basically said it is like we are robbing Peter to pay Paul (not his words). If you can't find any other analysis, catch Beck's March 20 show - surely it will be on the net.
There is always a moment when the people realize that inflation once started will not stop. It won't be a temporary one time thing. When this realization occurs and the people understand that their paycheck will mean less, their debtors will pay them less, and their savings will be worth less.
This is the moment when people flee to real goods instead of fiat money systems.
In order to understand todays economic news it is better to stop thinking of wealth in terms of dollars, but to think of wealth as the terms of control over resources.
While the media is flooding us with news about AIG, Dobbs, and the bonus tax... something else big is happening - one we are not hearing about.
It is nice to see someone is paying attention. What is really happening is scarier than you know. Basically the Government is saying it will stop at nothing to monetize this debt, and bail out the people who really pull the strings. What that means is the dollar is going to decline exponentially as a world currency. That is why you are already seeing spikes in all commodities, and it is only just starting. By the time these guys are finished we will be so far in the hole, the standard of life in this country will be reduced to something that right now we cannot conceive.
The US dollar should be worth about a penny, but the world keep it as the king currency, because and all other currency is screwed too - so keep printing and it hope it has value somehow by vodoo economics
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
