are they lying to us or are they clueless?

[LuckyInOC]

[quote=4plexowner]
In order to buy our bonds, the Chinese would print up yuan on their printer – this caused inflation IN CHINA because the only new currency created in this scenario was yuan (ie, we exported our inflation to China)
[/quote]

4plexowner, I don’t think China has to print any yuan. They just use our dollars from the trade deficit to buy those bonds or come over here and buy US property. Japan did the same thing in the ’70’s & ’80’s before their collapse.

As I see it, the FED is trying to pump enough money in to the system to make up for all the mortgages, stock market, and derivatives loses. I don’t think they will know when to or even can stop at the right time and will over shoot the mark.

The difference is between credit inflation and money inflation. All past US bank panic’s before and after the FED have been started due to credit inflation (also read ‘over speculation’) in land, stock market, or some other commodity. Banks or the US Govt over-leveraged the system with easy credit. It spilled over into the general economy.
When that speculation cycle ended, the economy collapsed as well.

The problem is most don’t think you can have too much of a good thing (gluttony). Over-speculation is the cause of a later collapse. The bigger the speculation, the bigger the collapse. We need to devise a system to identify and control over-speculation.

Lucky In OC

[4plexowner]

spot gold is $952 – June 2009 gold contract is $956

I’m looking at GLD and GC charts today – pretty easy to see them running to the $1200 level once $1000 is broken – will the fourth test of $1000 do the trick?

analysts that I read are placing targets of $1100-1650 for gold this spring – the most bullish is suggesting $1650 for gold and, get this, $28-32 for silver

this is not financial advise

there are lots of way to play gold – first question is always, “am I investing or speculating?” – personally, I am thinking speculation on a spring rally in gold – perhaps call options on the futures with expiration in the fall – perhaps some GLD, SLV and CEF shares

unfortunately, the basis for a spring rally in the precious metals is the continuing decline of America’s economy and future prospects

[4plexowner]

spot gold is $952 – June 2009 gold contract is $956

I’m looking at GLD and GC charts today – pretty easy to see them running to the $1200 level once $1000 is broken – will the fourth test of $1000 do the trick?

analysts that I read are placing targets of $1100-1650 for gold this spring – the most bullish is suggesting $1650 for gold and, get this, $28-32 for silver

this is not financial advise

there are lots of way to play gold – first question is always, “am I investing or speculating?” – personally, I am thinking speculation on a spring rally in gold – perhaps call options on the futures with expiration in the fall – perhaps some GLD, SLV and CEF shares

unfortunately, the basis for a spring rally in the precious metals is the continuing decline of America’s economy and future prospects

[4plexowner]

spot gold is $952 – June 2009 gold contract is $956

I’m looking at GLD and GC charts today – pretty easy to see them running to the $1200 level once $1000 is broken – will the fourth test of $1000 do the trick?

analysts that I read are placing targets of $1100-1650 for gold this spring – the most bullish is suggesting $1650 for gold and, get this, $28-32 for silver

this is not financial advise

there are lots of way to play gold – first question is always, “am I investing or speculating?” – personally, I am thinking speculation on a spring rally in gold – perhaps call options on the futures with expiration in the fall – perhaps some GLD, SLV and CEF shares

unfortunately, the basis for a spring rally in the precious metals is the continuing decline of America’s economy and future prospects

[4plexowner]

spot gold is $952 – June 2009 gold contract is $956

I’m looking at GLD and GC charts today – pretty easy to see them running to the $1200 level once $1000 is broken – will the fourth test of $1000 do the trick?

analysts that I read are placing targets of $1100-1650 for gold this spring – the most bullish is suggesting $1650 for gold and, get this, $28-32 for silver

this is not financial advise

there are lots of way to play gold – first question is always, “am I investing or speculating?” – personally, I am thinking speculation on a spring rally in gold – perhaps call options on the futures with expiration in the fall – perhaps some GLD, SLV and CEF shares

unfortunately, the basis for a spring rally in the precious metals is the continuing decline of America’s economy and future prospects

[4plexowner]

spot gold is $952 – June 2009 gold contract is $956

I’m looking at GLD and GC charts today – pretty easy to see them running to the $1200 level once $1000 is broken – will the fourth test of $1000 do the trick?

analysts that I read are placing targets of $1100-1650 for gold this spring – the most bullish is suggesting $1650 for gold and, get this, $28-32 for silver

this is not financial advise

there are lots of way to play gold – first question is always, “am I investing or speculating?” – personally, I am thinking speculation on a spring rally in gold – perhaps call options on the futures with expiration in the fall – perhaps some GLD, SLV and CEF shares

unfortunately, the basis for a spring rally in the precious metals is the continuing decline of America’s economy and future prospects

[TheBreeze]

[quote=jpinpb]

This has been my question. Everything the Fed is doing is screaming hyper-inflation down the road. BUT w/unemployment so high (I hear 20% in Detroit – surprised not more) and 10.5 in CA, I’m at a loss.
[/quote]

Even with high unemployment, the Fed could probably force hyperinflation upon us if they go from being the LENDER of last resort to being the BUYER of last resort.

The Fed is already planning to buy outright $1.2 trillion in bad assets. This proposed public-private partnership thing looks like more of the same, except instead of the government providing the full 100% overpayment, the ‘private partners’ will have to put in 3% or so. This is ~32:1 leverage.

Probably what we’ll see is BofA putting up 3% to help the government overpay for Citi’s assets with Citi putting up 3% to help the government overpay for BofA’s assets.

So it looks to me like the government has decided that since it can’t force banks to lend or people to borrow, that it is just going to become the buyer of last resort in order to force hyperinflation upon us. They’ll do some of this through outright purchases and some of it through ridiculous schemes that are pitched as ‘loans’ but are really ostensibly purchases by the government due to the absurd leverage involved.

[TheBreeze]

[quote=jpinpb]

This has been my question. Everything the Fed is doing is screaming hyper-inflation down the road. BUT w/unemployment so high (I hear 20% in Detroit – surprised not more) and 10.5 in CA, I’m at a loss.
[/quote]

Even with high unemployment, the Fed could probably force hyperinflation upon us if they go from being the LENDER of last resort to being the BUYER of last resort.

The Fed is already planning to buy outright $1.2 trillion in bad assets. This proposed public-private partnership thing looks like more of the same, except instead of the government providing the full 100% overpayment, the ‘private partners’ will have to put in 3% or so. This is ~32:1 leverage.

Probably what we’ll see is BofA putting up 3% to help the government overpay for Citi’s assets with Citi putting up 3% to help the government overpay for BofA’s assets.

So it looks to me like the government has decided that since it can’t force banks to lend or people to borrow, that it is just going to become the buyer of last resort in order to force hyperinflation upon us. They’ll do some of this through outright purchases and some of it through ridiculous schemes that are pitched as ‘loans’ but are really ostensibly purchases by the government due to the absurd leverage involved.

[TheBreeze]

[quote=jpinpb]

This has been my question. Everything the Fed is doing is screaming hyper-inflation down the road. BUT w/unemployment so high (I hear 20% in Detroit – surprised not more) and 10.5 in CA, I’m at a loss.
[/quote]

Even with high unemployment, the Fed could probably force hyperinflation upon us if they go from being the LENDER of last resort to being the BUYER of last resort.

The Fed is already planning to buy outright $1.2 trillion in bad assets. This proposed public-private partnership thing looks like more of the same, except instead of the government providing the full 100% overpayment, the ‘private partners’ will have to put in 3% or so. This is ~32:1 leverage.

Probably what we’ll see is BofA putting up 3% to help the government overpay for Citi’s assets with Citi putting up 3% to help the government overpay for BofA’s assets.

So it looks to me like the government has decided that since it can’t force banks to lend or people to borrow, that it is just going to become the buyer of last resort in order to force hyperinflation upon us. They’ll do some of this through outright purchases and some of it through ridiculous schemes that are pitched as ‘loans’ but are really ostensibly purchases by the government due to the absurd leverage involved.

[TheBreeze]

[quote=jpinpb]

This has been my question. Everything the Fed is doing is screaming hyper-inflation down the road. BUT w/unemployment so high (I hear 20% in Detroit – surprised not more) and 10.5 in CA, I’m at a loss.
[/quote]

Even with high unemployment, the Fed could probably force hyperinflation upon us if they go from being the LENDER of last resort to being the BUYER of last resort.

The Fed is already planning to buy outright $1.2 trillion in bad assets. This proposed public-private partnership thing looks like more of the same, except instead of the government providing the full 100% overpayment, the ‘private partners’ will have to put in 3% or so. This is ~32:1 leverage.

Probably what we’ll see is BofA putting up 3% to help the government overpay for Citi’s assets with Citi putting up 3% to help the government overpay for BofA’s assets.

So it looks to me like the government has decided that since it can’t force banks to lend or people to borrow, that it is just going to become the buyer of last resort in order to force hyperinflation upon us. They’ll do some of this through outright purchases and some of it through ridiculous schemes that are pitched as ‘loans’ but are really ostensibly purchases by the government due to the absurd leverage involved.

[TheBreeze]

[quote=jpinpb]

This has been my question. Everything the Fed is doing is screaming hyper-inflation down the road. BUT w/unemployment so high (I hear 20% in Detroit – surprised not more) and 10.5 in CA, I’m at a loss.
[/quote]

Even with high unemployment, the Fed could probably force hyperinflation upon us if they go from being the LENDER of last resort to being the BUYER of last resort.

The Fed is already planning to buy outright $1.2 trillion in bad assets. This proposed public-private partnership thing looks like more of the same, except instead of the government providing the full 100% overpayment, the ‘private partners’ will have to put in 3% or so. This is ~32:1 leverage.

Probably what we’ll see is BofA putting up 3% to help the government overpay for Citi’s assets with Citi putting up 3% to help the government overpay for BofA’s assets.

So it looks to me like the government has decided that since it can’t force banks to lend or people to borrow, that it is just going to become the buyer of last resort in order to force hyperinflation upon us. They’ll do some of this through outright purchases and some of it through ridiculous schemes that are pitched as ‘loans’ but are really ostensibly purchases by the government due to the absurd leverage involved.

[peterb]

I think the Fed bought bonds at one time in the 1930’s as well. Dont forget that FDR also confiscated gold and then raised the price from 21 to 35. You’d think those measures would be very inflationary. But they were’nt.

The bursting credit bubble was gigantic and derivatives market is in the 100’s of $T. It looks like money distruction far outwieghs money creation. We’ll see. But there’s a good chance that the safehaven in the future may more likely be in gold than US Treasuries. The next big dump in the markets will tell our future.
Just my 2 cents.

[peterb]

I think the Fed bought bonds at one time in the 1930’s as well. Dont forget that FDR also confiscated gold and then raised the price from 21 to 35. You’d think those measures would be very inflationary. But they were’nt.

The bursting credit bubble was gigantic and derivatives market is in the 100’s of $T. It looks like money distruction far outwieghs money creation. We’ll see. But there’s a good chance that the safehaven in the future may more likely be in gold than US Treasuries. The next big dump in the markets will tell our future.
Just my 2 cents.

[peterb]

I think the Fed bought bonds at one time in the 1930’s as well. Dont forget that FDR also confiscated gold and then raised the price from 21 to 35. You’d think those measures would be very inflationary. But they were’nt.

The bursting credit bubble was gigantic and derivatives market is in the 100’s of $T. It looks like money distruction far outwieghs money creation. We’ll see. But there’s a good chance that the safehaven in the future may more likely be in gold than US Treasuries. The next big dump in the markets will tell our future.
Just my 2 cents.

[peterb]

I think the Fed bought bonds at one time in the 1930’s as well. Dont forget that FDR also confiscated gold and then raised the price from 21 to 35. You’d think those measures would be very inflationary. But they were’nt.

The bursting credit bubble was gigantic and derivatives market is in the 100’s of $T. It looks like money distruction far outwieghs money creation. We’ll see. But there’s a good chance that the safehaven in the future may more likely be in gold than US Treasuries. The next big dump in the markets will tell our future.
Just my 2 cents.

[Author]

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