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

To: carranza2 who wrote (25270)	12/7/2009 9:18:46 AM
From: Real Man	Respond to of 71456

Hard to say, much depends on monetary policy. All Austrians say is that deflation in a fiat money regime and the economic hardship that accompanies it will inevitably trigger a printing response that is not constrained by anything, which is true. Abandonment of further credit expansion was what we saw in 2008 and are seeing now. In the first half of 2008 we saw a crack up boom. We are also seeing unconstrained printing response. During the Great Depression there was a constraint - the dollar was on gold standard. How about Japan? We'll see. Their sovereign debt position is about the worst out there among developed nations. While the WWII ended the GD in the US, it also zeroed out currencies of many countries, Japan included. Message 26154867 Message 26154689

To: carranza2 who wrote (25270)	12/7/2009 1:34:17 PM
From: benwood	Read Replies (1) \| Respond to of 71456

That's deflation due to prior fiscal insanity, and I'd agree with you there. It's more a case of everything unraveling ala Enron death spiral. But the deflation in the US of ~20% over the course of the 80 years preceding the formation of the 'inflation fighter' Feds was largely due to manufacturing and farming productivity gains, and that illustrates to me that the thing to fear now is the rogue side effects created by the Fed's actions, not deflation per se. But we'll get that chaos, mayhem, and reset anyway (got a preview last year) thanks to the massive distortions in the economy and the financial sector. So in the end, I believe the thing they claim to fear will actually have been much more benign, had they allowed it to occur e.g. in 2001, than the result of years of snake oil medicine. Of that, I have absolutely no doubt.