The View From 1776
Headlines of the Day - 2/27/08
Euro surpasses $1.50 mark for first time…
Gold Nears $1,000 ounce…
Bernanke Hints at More Rate Cuts…
The connection is fairly obvious. The escalating price of Euros and gold in dollars is a direct result of the Fed’s full throttle on money creation. Fed Chariman Benrancke is notorious for his assertion in the past that, if necessary, the Fed would load helicopters with currency and dump it into the streets to stem any recessionary correction to the economy.
No pain, no gain applies to economic business cycles. The Fed’s readiness to bail out financial institutions with more inflation is akin to expecting to put out a fire by dumping gasoline onto it.
- One more headline to ponder.
- Yes, and at a time when we need as many conservative voices as possible.
We have passed the point of no return even if we get by the current crisis. As Bernanke told Congress, if they wanted reforms that would avoid the coming crisis (said this before this crisis was revealed) they would have had to start 10 years ago.
I believe Obama (maybe Clinton) will be elected with a "veto-proof" democratic Congress in place. We will have a national health care plan in 2009. We will have further stimulus in the way of pumping hundreds of billions into infrastructure the states are demanding the Federal Government provide to bail them out of this crisis. One estimate was that the deficit with that spending added, would be $800 billion this year and the next few years. If there is any loss of projected tax revenues, as I believe there will be, it could easily be $1 trillion a year added to debt. This will be at the same time the boomer retirement has started and reduced pay roll taxes to loan the general fund will start showing up and be magnified if there is rising unemployment.
That move from "paying in" to "taking out," by the boomers mean we need hundreds of billions more in foreign loans at a time they are getting tired of loaning us money.
It doesn't look good.Posted by JanPBurr on 02/27 at 09:13 PM
- Wait until you see the effect of the US government's legal counterfeiting THEN!!!! Wheel-barrows to the grocery market, the movies, real estate brokers, etc. A new word for 'inflation' will have to be 'coined.' Fake?
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