The economic situation is about to explode or implode depending on how you are viewing the scene. Commodities (oil gold silver) are about to explode all the while stocks and the market has and will continue to implode. The swing of the pendulum has peaked and has begun it swing in the other direction and this is how Howard Katz explains the situation as quoted in my favorite newsletter “Miles Franklin” May 15, 2009 issue #102.
“ This long term situation is about to explode. For years, gold bugs have warned that the irresponsible fiscal and monetary policies being followed by the U. S. Government would result in a decline in American wealth and in American power in the world and a rise in the price of gold. They are going to be proven right in spades—Here, Now.”
Under the heading “Important Bulletin” page 6 we have this.
“Bernanke is making us 10 times as right as we ever thought we would be. The concept that the U.S. has increased it money supply by 70% in one year is simply not the American we have all known. It can’t be happening. But it is happening.”
Continuing on the next page.
“…China is leading the parade if those who want to live without the dollar. The Chinese are cleverly engineering the move away from the dollar. They have arranged currency swaps with seven nations (the latest Argentina) which would allow these counter-parties to settle some trading bills in Yuan. Thus China is effectively cutting the dollar out of its commerce. Interestingly, China’s biggest trading party is no longer the U.S. it is Brazil.”
What does all this mean to the average citizen of America? What has our government gotten us into? Because of our enormous government debt we as a nation have no flexibility of action and are now being, with each passing day, ever more manipulated by a global economy. The fact that we are told that the FED’s are fighting “Deflation” in this country may not be true globally.
Again I quote from “Miles Franklin”
“What has now occurred (in the Globalize Economy) the Federal Reserve has acted in their customary way in the wake of their own reckless monetary excess, by restricting the creation of “New” fiat credit (the Credit Crunch we are now experiencing). The problem for the Fed is that the Chinese have “Overturned” or “Trumped” Fed policy (by virtue of the staggering amount of dollars they hold arising from their balance of trade surplus by extending dollar reserve derived credit to spur demand (increasing foreign velocity of U.S. dollars)-which has, in turn, led to Global Inflation.”
“Effectively, the U.S. Federal Reserve has lost a significant amount of control of their own financial house and puts their current policies of money printing (aka inflation) at odds with their biggest creditor –China.”
There you have it folks—Now if that is not something that makes you set-up and pay attention, this might and I close. Page 19 “Miles Franklin” May 15, 2009 Issue #102 under the heading of “Nugget”
“Ron Paul’s Federal Reserve Transparency Bill has achieved a very significant milestone: it has 222 co-sponsors now, which means it can easily pass a house vote. Apparently it needs to get thru some kind of committee process and then introduced to the house Floor for a vote. Sounds like it should sail thru. If Bernie Sander’s sister bill in the Senate passes, all eyes will be on Obama to see what he does with this. A bona fide audit of the Fed could cause our country to completely unravel if what we suspect about the FED is true.”
I suspect the Fed will try and keep a lid on Paul & Sanders using President Obama. That will allow us to unravel over a longer period of time, allowing all the rats to run for cover, while the country goes into melt down and the economy completely fractures and all the kings (President Obama) men will not be able to put “Humpty Dumpty” back together again.
WE SHALL SEE and shortly.