If Gold sets a new high, above 1045, it means inflation is on the way. If that is the case, borrow all that you can at 5% because inflation will take care of what you REALLY owe.
Someone pointed out deflationists and inflationists both have good arguments, which is true….but what does your common sense tell you?
My commonsense says that if the Gooberment prints trillions, borrows additional trillions, there is a problem. If the u.s. ends up with a 20 trillion national debt, (now forecasted in four more years) and 30 year rates go to 6% (very low historically so highly probable) then the interest on the debt would be 1.2 trillion a year or HALF of federal tax receipts!
Common sense says the only thing that will bail out the federal government is inflation. Common sense says if unemployment is high, millions of people are not producing. If millions are not producing that means fewer goods and services. If the Fed is printing and there is more money going after fewer goods and services that would be highly inflationary.
The deflationists claim that excess labor will keep inflation at bay. Well, NEWS FLASH, we have had one other inflationary period, 70’s and 80’s, DOES ANYONE CARE TO LOOK AT THE UNEMPLOYMENT RATE DURING THAT PERIOD?
