comment on last critical point:
"I leave my mind open to a debt-induced deflation that is very harsh on commodity pricing as well. Doesn't sound like this is a possibility in your view."
with any other Fed Chairman, I would agree with you
but this Greenspasm has increased money supply rates to levels never seen before in the history of mankind
to expect commodity deflation requires Gspasm to turn off the spigot
Taylor relies on premises without argument or facts
and misses huge flaws in logic without bothering to discuss
I choose to base my forecasts on economic forces set against a backdrop of patterned Fed behavior
GreenScheiss cannot be more clear in his plan to destroy the dollar, launch gold, and inflate beyond all expectation
since 2001, the Fed under Gspasm has increased the monetary base at times by over 20% at annual rates
this is his indication on future response to trouble
he has left FedFunds at negative real rates for almost 12 months now
despite the warning signals given off by gold
even after the world bond markets revolted in July and August, he left rates unchanged
this confirms his indication on future movement
since 2001, the Fed under Gspasm has witnessed futility in monetary expansion
in early 2001, it took $5 of new money & credit to generate $1 in new GDP
in mid-2003, it now takes $6.5 new money & credit for $1 GDP
the benefit to GDP is absent, but GMan continues recklessly
we are accelerating in the monetary expansion
this is a clear indication of GreenScrotum's willingness to go overboard
if GreenMan slows the spigot, the monster comes in the front door
namely, recession, job cuts, real estate decline, etc
with loud public criticism, since easily traceable to Fed restraint
this man does not restrain in good times, in bad times, ANY times
if GreenMan keeps the spigot open on an increasing basis, we not only get the present situation, but a predictable path for the future
the production zone will be vulnerable to exactly what you describe with deflationary pressures, from liquidations and debt defaults, and simple failure to compete against foreign rivals including China
commodities are not provided by China, not crude oil, not natgas
but they do produce some gold, and they do refine much silver
China is a heavy buyer of oil, gas, gold
the financial zone will be subject to Fed monetary lost control, fully indicated, and completely predictable, with speculation, and desperate money pumping the likes of which even his supporters will object to
history is being made on central banking
Europe is harshly critical of our US monetary policy
they regard it as insane, and it will get worse
since GreenMan has repeated his message ad nauseum (but Taylor doesnt listen), we know that the risk is the dragon monster at the back door
IMPORTED PRICE INFLATION
FOREIGN REDUCTION IN TREZ BOND PURCHASES
HIGHER LONGTERM INTEREST RATES
FED MONETIZATION OF 10-YR NOTES
MORE DOLLAR ACCELERATION ON DOWNSIDE
FOREIGN DAMAGE TO CENTRAL BANK RESERVES (think fractional banking)
FOREIGN CENTRAL BANK HEDGING AGAINST USTBONDS
FEDERAL RESERVE COUNTER-BALANCE AGAINST ASIAN BANKS
we live in highly abnormal times
for your fears to come to pass, the Fed has to stop the presses
aint gonna happen
/ jim
p.s. I dont flip off
I stop arguing when the other side fails to respond to critical points, and keeps repeating the same shallow points, in a haughty annoying style |
