There is an old (I guess that makes it 'classic') Grateful Dead song that contains the lyrics: "...Trouble ahead! Trouble behind! Casey Jones you'd better watch your speed!..."
Seriously, when it was reported today that the Beard (Bernanke) had actually said he could "see recovery building" and his comments were credited with boosting the Dow today....well, it was really Jerry Garcia and the lads that I heard singing this song in my mind's eye, and NOT Ben's encouraging words.
There is TROUBLE AHEAD. Let's look at some publicly available data NOT being reported by the cheerleading squad for Team Obama (otherwise known as the MSM or the Ministry of Truth): [ref: US Gov't TIC reports]
Dollars and Bonds.
INFLOWS of foreign funds are dropping and we're seeing OUTFLOWS of funds.
The bond world is the most important market beneath the Dollar currency market...and absent that, the only resort is the printing press (otherwise known as the Zimbabwe option).
You can keep your head in the sand for a while, there is still a little string to play out until things come to a crashing halt, BUT it's pretty clear that foreign creditors are distancing themselves from the United States and this data foretells a flight from the Dollar. More "historic" CHANGE (otherwise known as disaster)!
Saturday, 22 August 2009
Trouble ahead...Dollar and Bonds............from Rico
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2 comments:
The only thing on God's green earth you can do with dollars is spend them in the USA, either to buy something or to invest in something.
Dollars are tickets in line to say what the US economy does next, presumably something for you, not wealth.
So an outflow of funds is zero problem. If they bury the dollars they simply take them out of circulation and the US is free to print more to replace them until they reappear.
The problem with the dollar exports are OK theory is that the money can be used not only to purchase goods but real capital assets. That means power.
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