Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : The coming US dollar crisis -- Ignore unavailable to you. Want to Upgrade?

To: Real Man who wrote (864)	9/5/2007 3:14:24 PM
From: Tommaso	Respond to of 71429

Yes, you are certainly correct (as you always are) about that. At some point, no matter how the statistics are fudged, higher inflation is going to show up on the screen for the Fed. At 8% a year or higher, they will not be able to continue the "put," which was made possible by very large gains in world economic productivity. There is no way to defend the value of a paper currency except by interest rates that are deliberately pushed higher than the inflation rate. The implication of 10% (or higher) short term rates for the value of long term bonds is a matter of simple arithmetic, and the implications for stocks is definitely bad, to put it mildly.