Inflation | toastyaroma | politics and news for the liberty minded

Posts Tagged ‘inflation’

The Federal Reserve slashes interest rate to 0, throws gas on the fire

Dec 18, 2008 Ron Paul, economy, news, politics

Ben Bernanke

On December 16, 2008, the Federal Reserve cut its key interest rate to a range between 0 and .25%, the lowest since 1954.

Why does the Federal Reserve, a group of wealthy private bankers who were unconstitutionally given a monopoly on the creation of money in the United States, think it can solve this economic crisis by doing the very thing it did to create the problem in the first place? By lowering interest rates, the Federal Reserve is attempting to inject liquidity into the market by making lending more attractive to member banks, and their member banks, all the way down to the consumer trying to buy a car or house he/she cannot afford. As if the massive debt realized by this process is not bad enough, the money that the Fed issues is printed out of thin air, and thus debases the dollar.

I suppose there is some good news: the Federal Reserve cannot lower interest rates any more! When this last ditch effort to mend the economy fails, which it is bound to do, everyone will (finally) understand that the Federal Reserve cannot simply print wealth. Everyone will understand that deficit financing and monetization of debt can only last so long. Everyone will understand what happens when an organization like the Federal Reserve is allowed to operate with no oversight, regulation, or transparency to the people of the United States of America. Everyone will finally understand that the unlimited production of fiat currency is a system that is inherently flawed and destined for failure.

Everyone will realize that Ron Paul, Peter Schiff, and so many others were right after all.

Tags: ben bernanke, economy, Federal Reserve, inflation, Peter Schiff, Ron Paul

More economic wisdom from Jonathan Lebed

Oct 14, 2008 economy, investing, politics

Jonathan Lebed warns about a new stimulus plan and the sucker’s rally in the dollar:

The crash we saw in the stock market during the past few weeks is nothing compared to the crash we are about to see in the Dollar.

Unfortunately, everybody in the government and media is too focused on current problems… they don’t have the foresight to see what problems are about to come next.

Everybody panicked and sold their stocks… and now they are hoarding Dollars. They escaped a hurricane but are now in the path of a tornado.

The hoarding of Dollars has created a temporarily strong Dollar… which is giving cover for Bernanke and Paulson to create as many Dollars as they want out of thin air to inflate the marketplace with liquidity.

If a publicly traded company was diluting their stock at the same rate as Bernanke and Paulson are diluting the Dollar… the stock would be trading for subpenny.

If your doctor was diluting your medicine or your farmer was diluting your milk, you would be outraged… wouldn’t you?

Just because we haven’t seen a run on the Dollar up until now, doesn’t mean it isn’t coming. It is coming… and it will happen very soon.

Most Americans don’t think it is possible for the Dollar to collapse. Some Americans think Dollars are still backed by Gold. It is this false trust and confidence that is keeping the Dollar propped up for now.

This trust will quickly evaporate. How could you trust a currency when the treasury secretary of the country is injecting $10 billion of this newly printed money into Goldman Sachs, his former company?

Now the Democrats in Congress want a new $150 billion stimulus plan. I told you before the first one was passed that it would be a disaster… and send prices of food and fuel through the roof. We had $5 a gallon gas by the time the checks arrived.

A stimulus is a direct injection of inflation… where you don’t have to wait to feel the effects. The $700 billion bailout will take a few months to work its way through the system… but combined with a stimulus we could see a perfect storm.

I profiled nine Gold and Silver companies as stocks to watch on Saturday, the most new stocks to watch I ever announced in one day. I gave DROOY a speculative rating of 1, my highest level of confidence. DROOY has been in business since 1895.

If you look at its long-term chart, back in 1979-1981… DROOY made a run from $15 to over $500 in less than two years. Another run like this for DROOY and several other of my new stocks to watch… is not only possible, but likely… if Gold prices skyrocket like I expect.

Hopefully those who doubted me in 2005 when I said to get out of Real Estate, will trust me now when I say to get out of the Dollar. Commodities will be the new hot asset class to invest in… and Gold will lead the way.