the guy is basically right on the shorterm and nearterm
liquidity drives the markets
this push in S&P and Naz is owing largely to significant increases to the US money supply, running at least 7% annually in growth rate
but the Fed is only lifting and inflating the US money supply in order to attempt an offset against the debt default and product liquidation, all resulting in price deflation
but it wont work for long
in fact, what you see now is the real scarey scenario outlined by the Austrian School coming to pass
the Fed has now increased the intake to the addicts for funny money
if the Fed ever slows this frenetic pace of bullshit money creation, the US Economy will enter a fast recession
we are accelerating the money creation pace, with little benefit
THEY CANNOT STOP THE PRESSES
the misconception among the public is that the Fed will be permitted to slow the money acceleration later on
NO WAY !!!
THE FED WILL NOT BE ABLE TO STOP
a rising money supply and a rising stock market has done little to stem the unemployment pink slips from layoffs
it has done little to increase capex investment
it has done little to stem the personal bankruptcies
it has done little to slow the trade gap hemorrhage
it has done little to slow the federal deficit explosion
so shorterm and nearterm, no problem, the Fed policy works
IF YOUR NEIGHBORS EACH GO BANKRUPT, DOES FLOODING YOUR STREET AND OTHER NEARBY STREETS WITH FUNNY MONEY FIX YOUR NEIGHBOR'S PROBLEM ???
nope, he will continue to liquidate
instead, other bubbles will appear
DOES FUNDING THE STIMULUS FOR ORANGE GROVES HELP THE FARMER WHO HAS VASTLY OVERSUPPLIED THE ORANGE INDUSTRY WITH DISTORTED EXTENDED BRANCHES ???
nope, the orange prices will continue to drop
instead, other bubbles will appear
NO WAY, wont happen
this guy is right
but dont dismay
listen to RRussell, who repeats often that the GOLD rally will enter the next stage with the fewest possible number of supporters and investors
I will be among them, laughing last
I expect you will be among us, but bellyaching all the way
hang in there
there is no rush
it might all fall apart after Nov2004
I can wait, and continue to accumulate
the Fed will overshoot, as they always do
we have years more of Fed frenetic money supply creation
IN 1-2 YEARS, ONLY THE USA WILL SUFFER FROM TERRIBLE PRICE INFLATION IN A SYSTEMIC FASHION, EVEN AS REAL ESTATE IS IN DECLINE !!!
gold will go ballistic
you are very impatient still, Pops
/ jim |
