10/14/10

America’s Currency Crisis is Now Underway

From: National Inflation Association

According to minutes that were just released this week from the Federal Reserve’s meeting on September 21st, the Federal Reserve is now trying to figure out ways to boost inflation expectations. The mainstream media is reporting that the Federal Reserve wants to publicly declare their intention to seek a higher inflation rate so that Americans are encouraged to spend more before their money is worth less. Unfortunately, what the mainstream media fails to realize is, not only will their money soon be worth less but it will literally become worthless.

If the Federal Reserve doesn’t immediately raise interest rates dramatically, there is serious risk of the current “meltup” turning into hyperinflation before the end of 2012. The Federal Reserve’s words can no longer control the present situation. They are saying they want inflation so that when massive inflation does arrive, it appears as though they still have control. With gold up 19% and silver up 38% since NIA’s July 28th article “Gold and Silver Capitulation is Near” in which we said, “the big move to the upside (for gold and silver) is right around the corner,” it is obvious that the Federal Reserve has completely lost control of inflation and a major currency crisis is already underway.

The world is flooded with excess liquidity of U.S. dollars. Up until now, Americans have been blessed by the fact that the world has been hoarding these dollars, believing they are a safe haven during these uncertain economic times. The world’s confidence in the U.S. dollar and strong demand for U.S. treasuries despite the need for the Federal Reserve to monetize our $13.6 trillion national debt will one day be looked back at as the most mysterious paradox of our generation.

The average American today is pouring money into U.S. treasuries. They got crushed when the dot-com bubble collapsed, they got decimated when the Real Estate bubble burst, and now they are loading into dollar-denominated assets. Simultaneously, the Federal Reserve is trying to destroy the purchasing power of the U.S. dollar. The only thing the Federal Reserve should be focused on today is preventing hyperinflation, because hyperinflation always leads to complete societal collapse.

Almost all American investment advisors tell their clients today that government bonds are the “safest investments there are” because they “are backed by the full faith and credit of the government.” It is very common for investment advisors to recommend to their clients that they put 25% or more of their assets into U.S. government bonds and keep another 25% of their assets in U.S. dollar cash. Yet, there are almost no investment advisors in existence who recommend to their clients that they put more than 5% of their assets into gold.

Investors who only put 5% of their assets into gold might find that they only retain 5% of their purchasing power in the future. Neither NIA nor its co-founders are investment advisors, but our commentary has consistently highlighted our beliefs that there is no such thing as owning too much gold. NIA believes that individual investors’ portfolios should be 100% in assets that will retain or increase in purchasing power during hyperinflation. The only question today that smart investors should be asking themselves is what percentages do I put into physical gold, physical silver, mining stocks, agricultural commodities, etc.

Obama continues to state he will not raise taxes for those earning less than $200,000, yet he is doing absolutely nothing to reduce government spending. With China and Japan getting ready to pull the plug on the U.S. dollar, future U.S. deficit spending will have to be paid for by outright money printing. The price inflation that is ahead as a result of monetary inflation is the absolute worst thing that can happen to middle class Americans. Obama’s inflation won’t hurt the wealthy as much because the wealthy, if they become educated and act quick enough, can still preserve the purchasing power of their wealth by buying gold and silver.

Obama’s plan to reduce our budget deficit from $1.6 trillion today down to $752 billion in 2015 is contingent on 5.58% annual GDP growth and interest rates on our public debt of only 4.1%. The only way we will see 5.58% annual GDP growth is with massive inflation and when inflation spirals out of control, so will interest rates. There is no doubt that our nation’s budget deficit come 2015 will be substantially higher than it is today, if our nation survives until then.

If you would like your friends and family members to be the first to see NIA’s new upcoming documentary about America’s societal collapse, please tell them to become a member of NIA for free at http://inflation.us.

10/14/10

Financial News Update – 10/14/10

Gold Hits Record High as Dollar Falls to Year’s Low

Dollar pummeled after Singapore widens FX band (Hat Tip: Brian B.)

News flash: Fed declares it MUST create inflation! (Hat Tip: Brian B.)

Family Farm Ordered to Destroy 50,000 Pounds of Cheese (Hat Tip: Brian B.)

Regence Blue Shield customers notified of skyrocketing rates (Hat Tip: Brian B.)

Medicare actuary: Reform will cost some seniors Medicare (Hat Tip: Brian B.)

Ethanol Decision Could Do More Harm Than Good

Obama Wants $1.25 B to Compensate up to 66,000 African American Farmers for USDA Discrimination in 1981-96; Census Says African American Farmers Peaked at 33,000 in Those Years (Hat Tip: Jean Stoner)

Obamacare Sticker Shock: Taxing Over 15,000 Medicines (Hat Tip: Jean Stoner)

Ethanol Decision Will Raise Meat, Poultry Prices, Tyson Says (Hat Tip: Brian B.)

Birth of the National Security State (Hat Tip: Brian B.)

The Coming Collapse of the Real Estate Market (Hat Tip: Brian B.)

Jim Grant: The World Is Abandoning the US Dollar

TheDC OP-ED: One nation, under fraud (Hat Tip: Kim Priestap)

BEACH: The political danger of a rising dependent population

Tea partiers won’t go when fun ends

Estate-Tax Rises Again as Issue on Trail

Campaign Taps Fears About Job Outsourcing

Gold Surges To Fresh Record Spot Of $1,367.65 On Report China To Put More Reserves Into Gold (Hat Tip: Jean Stoner)

Have Americans Already Been Hit With Obama Tax Hikes?

A landmark decision to make the right to water and sanitation legally binding (Hat Tip: Jean Stoner)

Meet The 25 Land Barons Who Collectively Own 1% Of America

Stephen Roach: QE1 Didn’t Work, QE2 Won’t Work, And QE 12 Won’t Work Either

A Wave Of Foreclosures Will Smash The New York City Home Price Fantasy

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America’s Wealthy Are Caught In A Positive Feedback Loop That Will Collapse The System

There Are Signs Of Schizophrenia In Treasuries And Gold

Hong Kong Property Shares Plummet After Government Says Rich Expat Playboys Are No Longer Guaranteed Residency

Niall Ferguson: A Second Stimulus Could Trigger A Debt Spiral Of Rising Rates And Crumbling Credibility

Warren Buffett’s Chinese Car Company Has 7 Factories Confiscated

Maxine Waters Has A New Mortgage Idea, And It Sounds Like Someone Is Laughing At Her Off Camera

Another Setback for Administration’s Legal Defense Of ObamaCare (Hat Tip: Jean Stoner)

GLOBAL MARKETS-US dollar drops on Singapore action, gold climbs (Hat Tip: Jean Stoner)

Foreclosure anger is now hitting election campaign (Hat Tip: Jean Stoner)

After Showing Improvement, Home Equity Delinquencies Are Now Clearly Getting Worse

Japan’s Central Bank Threatens To Buy Up Even More Stocks, Bonds, And Real Estate

RUMOR: China And US Working On Deal To Make QE Smaller, Yuan Appreciation Bigger (Hat Tip: Jean Stoner)

Jobless Claims, Inflation, Trade Deficit Each Surge Higher (Hat Tip: Jean Stoner)

Foreclosure auctions hit record as document crisis unfolds (Hat Tip: Jean Stoner)

Waters: People Who Signed Mortgage Loans Were “Tricked” (Hat Tip: Jean Stoner)

Stance on Fannie and Freddie dogs Frank (Hat Tip: Jean Stoner)

The enormous mortgage-bond scandal (Hat Tip: Jean Stoner)

Gonzalo Lira On The Coming Middle-Class Anarchy (Hat Tip: Brian B.)

Dollar To Come Under Attack; American Economy Will Go Offline (Hat Tip: Brian B.)

Gold futures hit new high near $1,378 (Hat Tip: Jean Stoner)

Morning Bell: The Tea Party Is Here to Stay

With Moratorium Lifted, Time to Start Issuing Permits

Side Effects: How Government Micromanagement Could Discourage Access to Some Preventive Services

Free Money! It’s a Nifty Gift from the Federal Government!

New, Useful Tool to Keep Up with the Health Care Lawsuits

Judge Gives Green Light for Constitutional Challenge of Obamacare

Glenn Beck Calls for ‘Largest Day of Fundraising’ for Chamber of Commerce

Caught on Tape– Sloshed Missouri State Auditor Susan Montee Pushes For Margarita Machine in Her Car (Video)

Economic Genius Jerry Brown: “We Need More Welfare & Fewer Jobs”

Chris Matthews Enters Crazy Town – Blames Chamber of Commerce For Unemployment Rate(?)

Michelle Obama Begs Voters to Give Her Husband More Time to Forge the Change

U.S. Home Seizures Reach Record Amid Foreclosure Review

U.S. Producer Prices Rose in September on Food, Fuel

U.S. Trade Gap Grows, Jobless Claims Unexpectedly Rise

Wall Street Lobbyists Besiege CFTC to Shape Derivatives Rules

Mortgage Rate on 30-Year Loan Falls to Record 4.19%

Does the U.S. Deserve Its Triple-A?

Applications for jobless benefits rise to 462,000

‘Higher-than-expected’

September home foreclosures top 100,000 for first time

Inflation, Trade Deficit Surge Higher

Dollar tanks, stocks drop as Bernanke speech looms

PAPER: Pelosi & Family flights cost taxpayers $2.1 million (Hat Tip: Jean Stoner)

Dollar hits fresh 15-year-low against yen

French students up protests over retirement reform

Obama admin to Let Insurers Raise Premiums for Sick Children

Washington’s largest insurer warns customers premiums may triple

Fla. Judge Rules 20 States Can Sue to Block ObamaCare

Queen cancels Christmas; Cost-cutting drive

SurvivalBlog:

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Dr. Gary North: Why the Gold Price is Rising

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