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Politics : Politics for Pros- moderated -- Ignore unavailable to you. Want to Upgrade?

To: Bearcatbob who wrote (291581)	2/8/2009 9:09:12 PM
From: Stevefoder	Read Replies (1) \| Respond to of 793771

watch the T Bill interest rate. Team Obama cannot control that. You are mostly correct. However, using the complicity of the Federal Reserve, Obama is getting the Fed to print money to buy T-bills. Essentially the plan is to combat deflation by printing money to provide cash for the Federal Government to spend to pump up the economy. That would suppress interest rates for an undetermined period of time. But it could blow up in our faces. What could easily happen is that interest rates would be held down, but suddenly inflation and interest rates would go out of control due to a loss of confidence in the dollar. It could explode overnight before the Fed could react to try to stop it. Shades of the Weimar Republic. The risk is hyperinflation which would destroy our economy and all our personal savings. It could cause a total collapse of government and our nation. The risk is real. Imagine getting a paycheck and spending it right away since you know that if you wait until the next day all prices would double, and then double again the day after that. Many knowledgeable people are trying to protect themselves against the risk by buying gold or ETF's that buy gold (eg GLD) or sell treasury bills short (eg. TBT). The wisdom of that strategy is debatable. Regardless, that is like buy a lifeboat and tying it to the good ship USA.