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

To: axial who wrote (19634)	4/12/2009 12:29:33 AM
From: Fiscally Conservative	Read Replies (1) \| Respond to of 71454

Thats my boy! eom

To: axial who wrote (19634)	4/12/2009 7:16:04 AM
From: Real Man	5 Recommendations Read Replies (1) \| Respond to of 71454

So far we did not like who was appointed to run the show in the new Administration, and we don't like the "reforms" implemented so far. In a nutshell, the same democratic crowd that got us into this mess can't get us out of it. The WS ties to the government are still strong, which pretty much ensures very inflationary outcome. Bernanke will keep the spigots wide open until unemployment numbers improve, too late. What he has done already ensures substantial destruction of the purchasing power of our currency. Reforms cannot proceed without pain - we have financial economy, with 40% of GDP running off Ponzi schemes. This means much of employment is in Ponzi areas. Simply put, folks in Ponzi areas need to get layed off and find a job in production areas, which would be the "red" pill. US economy needs some "shock therapy" the IMF often prescribed to developing countries. What have we done so far? We bailed out Ponzi areas and bankrupted the real economy.

To: axial who wrote (19634)	4/13/2009 5:59:13 AM
From: Real Man	7 Recommendations Read Replies (3) \| Respond to of 71454

Deflationists are saying 1.2 Trillion printed won't be enough. In a sense they are right, as hyperinflation is born out of debt deflation. The key is intent, not the amount. In hyperinflation no amount is enough, no matter how large, because the real economy died and all that money goes into inflation. We have witnessed enormous moral hazard and very lopsided bailout behavior of the Fed and the treasury when it comes to finance vs all other industries, did we not? 2 page application for TARP + buying all bad assets vs firing the CEO by the President (GM) + no LOANS unless you go bankrupt outside the court. That's what "agreement with bondholders" amounts to. Note that nobody ever wanted to buy GM's bad debt or tainted assets. While I would not argue that the government should bail out GM, I would just argue that the treatment of financial industry and the real industry in bailouts should be the same, if any bailouts are administered at all. It's actually best to let the financial speculators fail. They also should understand that as we lose the real economy, all the money they create will lead to much higher prices, because the "financial economy" does absolutely nothing productive. It's a parasite on the real economy. A huge parasite as of today. Why did GM or airlines go bankrupt? Because of the financial bubble, of course. The Debt bubble first hyperinflated gas prices, making their relatively good trucks not possible to sell, then the debt bubble popped, making it impossible for customers to get a loan. For a while GM and other big DOW industrial companies that are now in bad shape lived off finance. Why? Moral hazard that benefits financial industry made it impossible to run a real economy business.