Category Archives: Inflation

When will the dollar die?

Posted on October 28, 2010 | 5 comments

As I’ve said before, the debt-money system has a built-in debt/growth imperative, based as it is on compound interest.
Exponential growth cannot be sustained forever.

If debt MUST expand over time, it must be heaped upon either the private sector or the public sector.
When the debt carrying capacity of the private sector has been reached (as it has been now), the public sector must pick up the slack (as it has been doing for most of the past 100 years, but especially since 2008).
That is why I call government the “borrower of last resort.”
National governments are unique in being able to play this role because of their collusive arrangement with the banking cartel.
Once the government has absorbed all the available savings from the private sector, or if government debt cannot be marketed at acceptable rates of interest, the central bank will monetize the debt. That is the essence of inflation; generally rising prices are the result.

5 Comments

Posted in Inflation, The Debt Imperative, The Political Money System

Massive inflation is on the horizon

Posted on October 14, 2010 | 4 comments

The National Inflation Association has just published an article titled, America’s Currency Crisis is Now Underway. I pretty much agree with their assessment but they are touting gold and silver investments as the best way for people to protect themselves. While a little bit of investment in precious metals may yield some short-term profits, I think our long-term survivability requires investment in those things that support life–food, clothing, shelter, energy, etc.

My advice is to shift your investments from Wall Street to Main Street. Before your nest-egg loses all its purchasing power, invest in local enterprises that make you and your community more self-reliant and secure.

Read what I wrote about that a few weeks ago in my article, Investing in Uncertain Times.

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Posted in Finance and Economics, Inflation, The Political Money System

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Dollar debasement and its eventual loss of purchasing power

Posted on September 3, 2010 | 2 comments

The Federal Reserve and the banking system have been monetizing (buying) U.S. government debt at an accelerating pace. So why haven’t we seen greater increases in prices?

The fact is, some prices, like food and energy, have increased over the past 2 or 3 years. Having lived much of that time abroad, I notice it when I return. The reasons why price increases have not so far been more general are (1) the unemployment and business failures have left a large portion of the population with reduced incomes. Their diminished ability to buy and consume has offset, to some extent, the increased volume of dollars being lavished on the military, industrial, and financial sectors, (2) it takes time for those dollars to trickle down from the favored recipients who get to spend them first, and (3) the savings rate has gone up because in a depression, such as we are experiencing, people who do have money are more cautious about spending it. These savings are largely absorbed by government borrowing but they will never be sufficient to forestall debt tsunami that is building up. Add to this the fact that the rest of the world seems no longer willing to finance U.S. government deficits as they have in the past, and the outlook for the dollar is bleak. There will be no alternative to massive monetization.

A useful article titled, The U.S. Path to Collapse, was posted recently on the website of the National Inflation Association.  Unfortunately, they blame social spending like unemployment insurance, social security and medicare for the budget deficits, but ignore the massive spending to maintain the American empire and the pursuit of “full spectrum dominance” around the world. –t.h.g.

2 Comments

Posted in Finance and Economics, Inflation, The Political Money System