Catching Argentinian Disease

Catching Argentinian Disease?
The Ascent of Money
The Independence of the Fed Threatened
A Few Quick Thoughts on the Dollar, GDP, and the Recession

I have been in South America this week, speaking nine times in five days, interspersed with lots of meetings. The conversation kept coming back to the prospects for the dollar, but I was just as interested in talking with money managers and business people who had experienced the hyperinflation of Argentina and Brazil. How could such a thing happen? As it turned out, I was reading a rather remarkable book that addressed that question. There are those who believe that the United States is headed for hyperinflation because of our large and growing government fiscal deficit and massive future liabilities (as much as $56 trillion) for Medicare and Social Security.

This week, we will look at the Argentinian experience and ask ourselves whether "it" - hyperinflation - can happen here.

The Ascent of Money

I will be quoting from Niall Ferguson's recent book, The Ascent of Money. I cannot recommend this book too highly. In fact, I rank it up there with my all-time favorite book on economic history, Against the Gods, by the late (and sorely missed) Peter Bernstein. There are very few books I read twice. There are too many books and not enough time. This book I will have to read at least three times, and soon, and I have a lot of underlines and mark-ups in it already.

If there were one book I could require every member of the Congress to read, it would be this one. As I read it, I am struck again and again by how fragile and yet resilient our economic systems are. Fragile in the sense that governmental policy mistakes, no matter how well-intentioned, can destroy the wealth of a nation, and resilient in that it doesn't happen more often.

In his introduction Ferguson writes:

The first step towards understanding the complexities of the financial institutions and terminology is to find out where they came from. Only understand the origins of an institution or instrument and you will find its present day roles much easier to grasp.

As is often said, those who do not understand history are doomed to repeat it. If you want to understand what is happening in the economy, what the consequences of our choices could be, then I strongly suggest you get The Ascent of Money. It is easy to read, engaging, full of moments where you are led to pull together different ideas into an "Aha!" Ferguson is a brilliant writer and historian, and we are lucky to have this book at a time when it is sorely needed. (order it at Amazon.com)

As I have been writing, the United States in particular, and the developed world in general, are faced with a series of very unpleasant, if not downright bad choices. The time for good choices was ten years ago. Now we face the prospect of painful decisions, no matter what we do. It is not a matter of pain or no pain, of somehow avoiding the consequences of our bad decisions, it is simply deciding how much pain we will take and when, or allowing the pain to build up to a climactic event. Today we look at what I think would be the worst choice of all.

Catching Argentinian Disease

At the beginning of the 20^th century, Argentina was the seventh richest nation on earth. It's very name means "silver." "As rich as an Argentine" was a byword. Even after falling from the heights through a series of bad decisions, the country was still so wealthy that, in 1946 when new president Juan Peron first visited the central bank, he could remark that "There was so much gold you could barely walk through the corridors."

Argentina had actually defaulted on its debt in the late 19^th century, not once but twice! But still they managed to avoid destroying the currency and devastating the country. But in 1989, after years of massive budget deficits that were financed with borrowing from abroad and Argentinian citizens, the country was left with so much debt and no one was willing to lend it any more money, that the leaders felt compelled to resort to the printing press.

My Uruguayan friend and Latin American partner, Enrique Fynn, tells me of his experience of going to Buenos Aires and buying a pack of cigarettes one evening. He went into the store the next morning for another pack, and the price had doubled. He came back that evening and the price had doubled again (thankfully for his health, he has quit!). There were no prices on any items in the grocery stores. There was a man with a microphone who would announce the prices of various items, often increasing the price every few hours by 30% or more.

Workers would get their pay in cash and rush to the store to buy anything, as by the end of the week their pay would be worthless. Of course, shelves were empty. The US dollar was king, and could purchase things at amazing prices. I heard stories that were truly compelling. (It made me wish I had gone shopping in Buenos Aires at the time!)

Interestingly, the dollar is still the real medium of exchange. I was told by several people that if you want to buy a house for half a million dollars, you bring the physical cash to the closing. One person counts the money and the other checks the paperwork and title. Argentina has the second largest hoard of physical dollars in the world, only exceeded by Russia. Is it any wonder they are concerned with the value of the dollar?

Let's look at some quotes from Ferguson (emphasis mine):

The economic history of Argentina in the twentieth century is an object lesson that all the resources in the world can be set at nought by financial mismanagement... To understand Argentina's economic decline, it is once again necessary to see that inflation was a political as much as a monetary phenomenon...

"To put it simply, there was no significant group with an interest in price stability..."

Inflation is a monetary phenomenon, as Milton Friedman said. But hyperinflation is always and everywhere a political phenomenon, in the sense that it cannot occur without a fundamental malfunction of a country's political economy.

Look at the chart below (click to enlarge). Using realistic assumptions, It suggests that the annual US government fiscal deficit will approach $2 trillion in 2019. How can we come up with what looks to be about $15 trillion over the next ten years? The Argentinian answer was to print the money.

In the US, the short answer is that unless the US consumers become a massive saving machine, to the tune of 8% or more of GDP and rising each year, and willingly put their savings into US government debt, it's not going to happen. So sometime in the coming years, interest rates are likely to start to rise in order to compensate bond investors for what they perceive as risk. That will bring us to some very difficult and painful choices.

As I wrote a few weeks ago, this scenario could be averted IF the Obama administration produced a credible plan to lower the deficit over time and stuck to it. But today's thought process is about what happens if they don't.

Ferguson pointed out in the quotes above that hyperinflation is always and everywhere a political decision. Governments have to choose to print money. In theory and in practice, what would happen if the Fed decided to accommodate a politicized US government that wanted to spend money on favorite projects and support groups, maybe even deserving programs like health care or defense or pensions or Social Security? Money they could not borrow?

Then Peter Schiff and like-minded thinkers would be right. Once you start down that path, it is hard to stop short of the brink. Brazil got to 100% inflation per month and has really lowered that level over time, but it is not easy.

In such a scenario, you want to own hard assets. Gold. Foreign currencies. Stocks. Almost anything other than the currency that is being printed.

I was asked at almost every speech about that scenario. In Latin America, hyperinflation is not a theoretical issue; it has been reality. More than one person commented on that no one in US economics schools studies hyperinflation. It is required material in Latin America. For many Latin Americans, the dollar has been their safe haven. And now they are worried, with good reason.

For the record, I do not think the US will experience hyperinflation as long as the Fed maintains its independence. Read the speeches from various Fed governors and regional presidents. These are strong personalities, and they understand that going down that path ends in massive tears. Bernanke warned just a few weeks ago that the government needs to get serious about the fiscal deficit. Watch the rhetoric from the Fed heat up after his reconfirmation and the confirmation of two new governors in the first quarter.

The Fed has committed to buy a fixed amount of government debt in its quantitative easing program. That commitment will be finished by the end of the first quarter (if I remember correctly). Then comes the tricky part.

I have been writing for a long time that the main force in the economy right now is deflation. The Fed will fight deflation tooth and nail. But they don't have to buy government debt to fight deflation. They can buy mortgage securities, credit card securities, commercial paper, etc. That will have the effect of easing without encouraging the government to run massive deficits. And such debts are naturally self-liquidating, while government debt is not, at least not in the same way.

I believe the Fed will maintain its independence. Not to do so is to court economic disaster of the first order. These are bright and serious men and women. They get it.

The Independence of the Fed Threatened

The risk is that something changes to compromise their independence. And sadly, there is some risk. Let me quote my fishing buddy friend David Kotok:

It's now official. The proposed legislation to reform America's financial service supervision includes granting the Secretary of the Treasury a veto over Section 13(3) emergency action by the Federal Reserve Board of Governors. If this becomes law, it will be a sad day for the independence of America's central bank.

The Secretary of the Treasury, a very senior cabinet position, is appointed by the President and meets with the President in the Oval Office weekly. The governors of the Federal Reserve Board are also appointed by the President. Both cabinet officers and Federal Reserve governors are confirmed by the US Senate. There are supposed to be seven governors; politics has purposefully limited this to five throughout the three-year financial crisis period.

The Federal Reserve governors are supposed to serve staggered 14-year terms with all seven seats filled. Instead, we have been governed by the present five-member, politically configured board.

"The original seven-governor construction was designed to insulate them from political pressure, for very good reasons. Decades of monetary history throughout the world have disclosed what happens when political influence on a central bank intensifies. The Weimar Republic and Zimbabwe are evidence of the worst inflationary effects of politics. The Great Depression in the US and the nearly two-decade deflationary recession in Japan demonstrate that monetary policy is not only inflation-prone. When central banks are under political influence you can get fire or you can get ice.

In Japan, the central bank contends with two members of the cabinet sitting in on its deliberations. There is no way to know how much of the last 15 years of deflation and recession is attributable to the inside political pressures placed on the governors of the Bank of Japan. But there is evidence to suggest political influence, especially when you observe how little the Bank of Japan has engaged in asset expansion during this crisis.

This is the nose of the camel under the tent. Starting down this road is very worrisome indeed. I find it appalling that Tim Geithner and Larry Summers went along with this. This is a very clear attempt by the political class to put political pressure on the Fed. I hope the Fed responds with vigor. I can tell you that the officials of whom I am aware will not take kindly to pressure. And that might be an understatement.

(Yes, I am aware of the problems of the Fed being able to decide whom to bail out and why. It is not a perfect world. But better the Fed than Congress.)

All that being said, if the Fed starts to increase its buying of government debt above its initial commitment, then my "optimistic" scenario of a very rough economic patch, which I have been outlining the past few months, is far too rose-colored. I do not think it will happen, but I can guarantee you, I and a lot of other people will be watching.

A Few Quick Thoughts on the Dollar, GDP, and the Recession

Just a few quick notes. When world trade collapsed, so did the need for US dollars, which is what the world uses to transact business. The data looks like world trade is finding a bottom and maybe even recovering somewhat. That means there will be the need for more dollars. And since everybody and their mother are short the dollar, there could be a vicious snap-back rally. I am still bearish the US dollar (and the yen and the euro and the pound) over the long term, but there is the potential for a real rally here.

And my friend Mish Shedlock commented on the US GDP report, which said the US GDP rose 3.5%:

Today the market is cheering over what is actually an ugly report. A misguided Cash-for-Clunkers added a one-time contribution of 1.66 percentage points to GDP. Auto sales have since collapsed so all the program did is move some demand forward. Government spending increased at 7.9 percent in the third quarter which is certainly nothing to cheer about. Personal income decreased $15.5 billion (0.5 percent), while real disposable personal income decreased 3.4 percent, in contrast to an increase of 3.8 percent last quarter. Those are horrible numbers. The savings rate is down, which no doubt has misguided economists cheering, but people spending more than they make is one of the things that got us into trouble. The only bright spot I can find is exports. However, even there we must not get too excited as imports rose much more.

John Williams notes that one-time stimulus or inventory items represented 92% of the reported quarterly growth. The nature of the stimulus-related gains was that they tended to steal business activity from the future. The months ahead are the future. Accordingly, fourth-quarter quarterly GDP change will likely turn negative, again. (The King Report)

And David Rosenberg writes:

Only economists see the recession as being over; the man on the street sees it a little differently, perhaps less enthused by the fact that a lower rate of inventory destocking is arithmetically underpinning GDP growth at this time. Put simply, a Wall Street Journal/NBC News poll just found that 58% of the public believe the economic recession still has a ways to go -- and that is up from 52% in September and means that the private investor, unlike the hedge fund manager, is not interested in adding risk to the portfolio even after a 60% surge in the equity market.

Only 29% of those polled believe the economy has hit bottom -- imagine having that psychology with nearly zero interest rates, a bloated Fed balance sheet and unprecedented fiscal deficits (poll was taken from October 23-25). Nearly two in three (64%) said the rally in the stock market (still a bear market rally -- not the onset of a new bull market) has not swayed their view (or ours for that matter).

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Comments

[The Geoffster:]

Another great article John. Thanks. I agree that we are unlikely to experience hyperinflation for the reasons you mention but the policy choices will be difficult. As it is, a family of four making $70,000 a year pays no income taxes at the federal level. Put another way, 48% of filers pay nothing! Neither political party has shown much fiscal discipline and will battle each other over spending cuts versus tax increases. A editorial in this morning's New York Times illustrates the problem. It advocates free or subsidized health care for those who do not qualify for medicare or medicaid. The cost would be absorbed by an already diminished tax base which will only shrink as more and more middle class people fall off the rolls. In a nutshell, our government has promised too much to too many people, but when the majority pays no income tax, they have no skin in the game and will not vote for politicians who cut their benefits or raise their taxes. As I heard the other day, this country fought a revolution over taxation without representation. Now we have representation without taxation.

Nov 01 09:05 AM

[notsosmart:]

this country is being hollowed out.there should be a flat tax of some percent for all. even if you earned $1.no deductions for anything or anybody.thats capitalism.fairness then would be gone along with unfairness.you could actually get rid of most of the irs.the cpas would fight this as they would shrink also.tax lawyers would be gone.on a local level all should pay a property tax on the same basis.1% on the last sale of the property & all religious,schools etc. should have to pay as they want & get police fire,sewer,water,etc service. we have schools here (private)that charge$30-35,000 a year for the wealthy that dont pay a penny in taxes.the whole system has turned into a joke.(the rich laugh as they complain).

Nov 01 11:30 AM

[ebworthen:]

Great thoughts and references, thank you.

I fear the FED will not be able to act independently. If you watched Timothy Geithner testify and ask for more power for the FED and kiss up to the politicians, especially Barney Frank, you have to question if they will be able to raise rates and withdraw liquidity.

The Obama administration has little to no restraint - they are idealogues who will push their agenda before consideration of the economic realities.

Batten down the hatches.

Nov 01 01:44 PM

[Ava Et:]

I believe you are underestimating this nation. While history is dramatized by the push and pull of interests, common sense, fairness, rewarding merit over privilege, innovation, adaptability, willingness to take on risk, these are the less dramatic pillars of our story. Barney Frank embodies many of these values, and so do many of those who demonize him. These men and women will move us forward. This nation holds its leaders accountable like no other, and Americans hold their leaders responsible because the individuals of this nation take responsibility of their own lives, and their communities like no other nation. From the most liberal communities to the most conservative, individuals, activist citizen groups, churches, political clubs, etc. take responsibility for making our nation a better place. The diversity of our backgrounds, as Americans, often leaves us feeling insecure, but actually the fact that we are are allied in values rather than custom and tradition makes us more able to confront adversity. While freedom is often touted by as something akin to license, most Americans recognize freedom as a call to responsibility. Our great fortune is that we have the freedom to choose how we wish to be responsible, and citizens from Maine to California are taking this freedom on. America did not emerge out of the great depression as a complacent people who were happy with a unifying dictator. We are not going to collapse like Argentina where interests groups could not work toward the common good. Our demise is greatly over estimated.

Nov 01 04:24 PM

[ebworthen:]

Well, I agree with some of your thoughts and like your optimism, I just don't see it.

If we held to these values we would not have bailed out banks and insurance companies.

Barney Frank has received campaign contributions, sweetheart loan deals, and has been in bed with Countrywide and Fannie/Freddie and pushed giving bad loans to those who couldn't repay them. He and Dodd and Congressional representatives left and right are complicit as well.

I can't look at a tax cheat being appointed to lead the Treasury, or the bailouts, or the coming cap and tax and increased taxes and the failure to enforce immigration policies or Wall Street bonuses for failure or the Supreme Court KELO decision to rescind personal property rights and believe that the values and morals of the nation are intact and that we will move forward.

We have not held our leaders accountable.

Those pillars you speak of have been turned to salt, and it is raining.


On Nov 01 04:24 PM Ava Et wrote:

> I believe you are underestimating this nation. While history is dramatized
> by the push and pull of interests, common sense, fairness, rewarding
> merit over privilege, innovation, adaptability, willingness to take
> on risk, these are the less dramatic pillars of our story. Barney
> Frank embodies many of these values, and so do many of those who
> demonize him. These men and women will move us forward. This nation
> holds its leaders accountable like no other, and Americans hold their
> leaders responsible because the individuals of this nation take responsibility
> of their own lives, and their communities like no other nation. From
> the most liberal communities to the most conservative, individuals,
> activist citizen groups, churches, political clubs, etc. take responsibility
> for making our nation a better place. The diversity of our backgrounds,
> as Americans, often leaves us feeling insecure, but actually the
> fact that we are are allied in values rather than custom and tradition
> makes us more able to confront adversity. While freedom is often
> touted by as something akin to license, most Americans recognize
> freedom as a call to responsibility. Our great fortune is that we
> have the freedom to choose how we wish to be responsible, and citizens
> from Maine to California are taking this freedom on. America did
> not emerge out of the great depression as a complacent people who
> were happy with a unifying dictator. We are not going to collapse
> like Argentina where interests groups could not work toward the common
> good. Our demise is greatly over estimated.

Nov 01 07:22 PM

[bob adamson:]

Mr. Mauldin is right that all the options now open to the US and the other major global economies are difficult and unattractive. However, it is a rhetorical excess to invoke the specter of Argentine hyperinflation as a possible or probable fate the US faces, let alone an option.

Clearly a deflationary depression was a clear and present danger through the October, 2008, to March, 2009, period and the response (massive fiscal and monetary stimulus coordinated across all the major mature economies and the prime emerging economy, China) created the possibility of high inflation at some point in the future once the threat of deflation abated (although, arguably, no creditable alternative to such a stimulus program was apparent last fall and winter). By now the threat of deflation has diminished significantly but it is unclear what prospects the near future holds. A soundly based US and global recovery may be attainable now but the route to this end will be long, difficult and both unclear and controversial. Alternatively, plausible arguments can be made for each of one or a combination of the following unattractive scenarios for the US: the relapse into deflation or recession, the emergence of stagflation, inflation coupled with anemic growth, growing international currency instability, continuation of the current level of economic activity dependant on continuing levels of stimulus etc. The one scenario that does not appear plausible is USD hyperinflation, however.

The reason that USD hyperinflation is not creditable is that:
1. Hyperinflation differs significantly from inflation because for hyperinflation to exist the government and central bank must have chosen to follow a policy of unrestrained rapid money creation over time. Inflation does not simply morph into hyperinflation over time through inadvertence of the monetary and fiscal authorities because inflation, however severe, can be curtailed in fairly short order by concerted (albeit unpleasant) action by these authorities to stop spending and cut the money supply. It follows that hyperinflation will only occur where these authorities decide that such concerted action will not be taken.
2. Hyperinflation in Argentina, Brazil and the Weimar Republic can each be shown to be cases where the monetary and fiscal authorities consciously chose not to take such concerted action. In each case, hyperinflation was ended when these authorities decided that the time had come for its end.
3. There is no plausible reason why the US authorities would choose to implement a policy of unrestrained rapid money creation over time; any conceivable end they might want to achieve can be achieved better by attainable and less damaging means. In other words the unique situations faced by each of Argentina, Brazil and the Weimar Republic leading to hyperinflation are outside the realm of the plausible for the US.
4. It is in the interest of all the other significant mature and emerging economies that the US succeeds in avoiding hyperinflation. The US therefore will have the added advantage (an advantage not shared in the past by Argentina, Brazil and the Weimar Republic) that its actions to curtail inflation, when and if it arises, will have active international support and assistance. In the eyes of the other leading economies, the US is ‘too big to fail’ if only because the global economy cannot recover without US participation.

Mr. Mauldin is obviously frustrated and angry with the current course of US economic policy and there is a reasonable basis for these attitudes (as there is for the attitudes of those with a more sanguine take on things). That said, he and many of those commenting on his article are being far too pessimistic in their envisioning of imminent US hyperinflation.

Nov 02 01:44 AM

[Value Added:]

John, I appreciate your commentary and agree with you about the book, "The Ascent of Money" - it's a worthwhile read. But I think you overestimate the independence of the Fed and the effectiveness of options left open to the Fed. If the Fed was that independent, it would not be fighting, tooth and nail, an independent audit. If the Fed was that independent, it would push back on Congress and the administration and tell it to get its house in order before it continues further easing. If the Fed continues to buy government securities, the bond market will eventually require its pound of flesh by higher interest rates. If the Fed buys mortgage securities and the like - how does that help? The real estate market is slack, prudent consumers are scaling back, and extending more liquidity to subprime risks will not be "self-liquidating" as you say; rather, it will only liquidate more taxpayer and savers' wealth. It used to be that there was some distance between the edges of deflationary recession and inflation, and the Fed played the gap. Today, those edges touch or overlap, and there is no pain-free path available. The *primary* reason this is so, is because we have become an unproductive nation. All we can sell is pieces of paper, and assets like land and companies. You say, "These are bright and serious men and women. They get it." John, that's almost right. They are bright and serious people, but sadly, they don't have a clue. Our problems are ultimately the result of consumption and greed triumphing over productivity and adding value, and the folks in Washington think all will be well when the consumer gets his/her confidence back. There are only blind men in the engine of this train, John, and they've got the throttle wide open.

Nov 02 08:49 AM

[Formyx:]

We have seen already an Argentinization in this country when Schwartzeneger paid public employees with Californian "Patacones". A warning sign?

Nov 02 03:02 PM

[ryanclarke:]

The Fed's inflationary approach to solving this economic problem will be severe ... and will be construed as hyperinflationary ... if the Fed leaves the .25% interest rate policy intact for another six months ... po' jo' (poor joe) will pay for it at the gasoline pump if he decides first not to quit his two jobs and go camp in a national forest somewhere ... just like the last group of hippies did in the 70's. I would go as far as to say ... the primary reason private sector employment in the last ten years is now flat even though the U.S. population has increased some seven million people ... is because the "lawn boys" and the "cleaning ladies" of this current society now work for cash only ... filing income taxes or paying into social security isn't worth their time ... they know the system as is doesn't "work for them."

Nov 02 03:33 PM

[Chancer:]

What will Obama do assuming he gets re-elected to a second term?

I am convinced he will NOT raise INCOME taxes on the middle class, because the Democrats will lose power with a middle class revolt.

They cannot get enough in tax revenue from raising taxes on the wealthy.

What I believe Obama and the Democrats will do is give us a value-added-tax (like Europe). This may begin low; and later be increased. It may begin with products only, exempting food, services, drugs; and later be increased and cover more up to 100% of all purchases.

This is a easily hidden tax. Politicians can lie about the amount and affect. It will be a huge tax revenue gain for socialist liberals and central planners- a dream tax for socialists. Nancy Pelosi said we need a VAT to level the playing field with Europe. That means raise our taxes and decrease our standard of living to be more equal with Europe; because liberals believe it is just so unfair that Americans should do better then Europeans.

The VAT tax will harm economic growth, job growth, savings, and cause a huge decline in American living standards. Americans will become a nation of renters and public transportation commuters. Home and car ownership will be rare.

Nov 02 04:05 PM

[Alphameister:]

I expect a value-added tax, and I also expect legislation to require all retirement plans (federal employees presumably exempted) to invest some specified percentage of their assets in treasury debt. Whatever the starting levels for such programs, I expect both to increase steadily over time. I expect a wide range of devastatingly destructive legislation out of the socialists now running the country. Coming at a time of great economic vullnerability, I see hard times for as far as the mind's eye can see.

One simple fix would hold the potential to fix the mess we are in: limit the vote to those who pay personal income taxes (above and beyond payments to the social-security ponzi scheme).

Nov 02 06:34 PM

[surfgeezer:]

Your assumptions are wrong. The VAT would be the best thing for middle class taxpayers. Your main complaint seems to be it is an easily hidden tax. Income taxes are punishing good behavior and are so counterproductive they cannot be "hidden" is not an advantage. As ryanclarke points out a huge portion of income is "hidden" and I would say even more is hidden on the upper end. A value tax lets people in other countries pay our taxes for exported goods and materials and transfer the cost of running the system to a much wider base. Income taxes are a red flag that the political parties use as wedge for gain.


On Nov 02 04:05 PM Chancer wrote:

> What will Obama do assuming he gets re-elected to a second term?
>
>
> I am convinced he will NOT raise INCOME taxes on the middle class,
> because the Democrats will lose power with a middle class revolt.
>
>
> They cannot get enough in tax revenue from raising taxes on the wealthy.
>
>
> What I believe Obama and the Democrats will do is give us a value-added-tax
> (like Europe). This may begin low; and later be increased. It may
> begin with products only, exempting food, services, drugs; and later
> be increased and cover more up to 100% of all purchases.
>
> This is a easily hidden tax. Politicians can lie about the amount
> and affect. It will be a huge tax revenue gain for socialist liberals
> and central planners- a dream tax for socialists. Nancy Pelosi said
> we need a VAT to level the playing field with Europe. That means
> raise our taxes and decrease our standard of living to be more equal
> with Europe; because liberals believe it is just so unfair that Americans
> should do better then Europeans.
>
> The VAT tax will harm economic growth, job growth, savings, and cause
> a huge decline in American living standards. Americans will become
> a nation of renters and public transportation commuters. Home and
> car ownership will be rare.

Nov 02 10:14 PM

[Nicholas1980:]

~it will be a sad day for the "independence of America's central bank"~
The USA has an independent central bank? really?
Isn't the FED a "private company", that behaves like the central bank of the USA? So in other words..do they really care about "we the people?
The last questions is clear: No.

Nov 04 12:37 AM