huangjin

Too Much Money Chasing Too Few Commodities

MZM includes credit and Bernanke can't control credit markets. In fact, he's been cutting the growth of money supply since he took office, barely skipping a beat. Lower rates appear inflationary, but base money still isn't growing. I don't think Bernanke planned this, but it's almost a perfect set-up. Just when people are worried about a collapsing credit market and deflation could kill confidence, we have at the helm a man who people call "Helicopter Ben". But he is quietly pulling money out of the system and taking out the housing bubble, while speculators pour into commodities. I think we're going to see the dollar rebound like a bat out of hell once the market catches on to what has been going on for the last two years, and instead of $200 oil, Ben Bernanke will be drinking the tears of Hugo Chavez.