Listen to Peter Schiff spell it out in simple terms that can't be denied. Commodities are shooting through the roof. Look at the price of gas over the last few weeks, look at the dollar's sharp declines recently. Since last summer, the dollar had risen dramatically and now it has fallen sharply over the last month, losing nearly 10% of it's value in that period of time US Dollar vs Euro Chart. Look at the price of Silver (Chart). Since January the price of silver has risen from $11 per ounce to a close of $15.79 on Friday. That is a 43.5% gain in 5 months. That coincides with the price of gas we are seeing at the pump, which will soon be back to $3/gallon. That is going to put a serious crimp into any Economic Recovery Plans.
All of this points to the fact that inflation and volatility are here. Now is where the rubber will meet the road and the Federal Government over the next few months will have to make some tough choices. They have two choices:
1) Pull the plug out from underneath the printing press - monopoly money machine. Get the dollar to comeback to reality and the housing market and auto sectors continue their deterioration. -Or-
2) Keep printing the Monopoly money like they have been doing and watch inflation take off, which will further reduce the value of our wages and further erode the purchasing power and the retail sector. Either way interest rates are going to have to rise. Option 1 is the Common Sense solution and the better solution over the long haul. Look at the increase in the money supply over the last 8 months (shown in this graph).
Now I present Mr. Schiff's Vlog from 5/29/2009:
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Saturday, May 30, 2009
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3 comments:
Things are slow but, fires are still being put out, garbage is still being picked up, and crooks are still being thrown in jail.
Did you see Glenn Beck last night where it was stated that the average U.S. prison is 30% over capacity.
Look at this story from Ohio. Ohio Prison Overcapacity
North Carolina OvercapacityWe either have to build more prisons or (the better idea) start putting non-violent law breakers under house arrest. The burden of incarcerating this many people is breaking the budget.
Anonymous: I suppose one might call this "seeing the glass half full". This comment reflects a sentiment that government is doing its job, so all is well. But this person overlooks the fact that local government (Hickory/Catawba County) has done little to facilitate economic development in the past decade resulting in the highest unemployment in the country. This comment defends the "status quo", it presumes that the job that is being done is being done adequately. This is the attitude that Nero had as Rome burned.
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