Prudent Investor

Monetary Madness in a Single Chart: Hyperinflation's Just Around the Corner

The Fed will not be able to absorb all the fresh money - ahem, "liquidity" - because they bought all kinds of crap paper (CDOs) at mark-to-fantasy prices. Who will bail out the Fed by buying this crap anywhere close to the prices the Fed "paid" (hahaha) with its freshly digitized "money." Quote from JP Morgan, "Gold is money. Everything else is credit."

Expecting Hyper-Inflation: Fed Chooses to Monetize America's Debt

Thank you all very much!!! I am overwhelmed by receiving 50 comments on this post. I have to re-read all your comments and hope to answer your opinions/questions in the future posts to come. Nothing drives me more than such witty responses! Thx again.

Monetizing the Debt: Explanation For Non-Economists, Bankers and Other Laymen

IMO Blogging is about expressing an opinion.


On May 11 09:04 AM Dave Raithel wrote:

> A non-polemical account would have been much appreciated, but I usually
> expect too much from people. About all this "essay" does is demonstrate,
> once again, that "economics" is not a science. Economics is a babble
> of competing claims about reality reflecting the interests of the
> babblers...

Monetizing the Debt: Explanation For Non-Economists, Bankers and Other Laymen

Prudent Man,
I am impressed and would like to give you a TRILLION thumbs ups. Pls check out my latest post
prudentinvestor.blogsp...
and add to it.

A Must See Movie: 'Zeitgeist Addendum' Explains the Fiat Money System

Andypandy,
I will follow up this week with some links that explain this fundamental problem - which you sense very correctly - of a fiat money system.
One book I recommend to everybody interested in the subject is "Secrets of the Temple" by William Greider which is by far the best (of the very few) book about the Federal Reserve. Greider is a Washington Post veteran who has moved to the left of the political sphere since he wrote this master piece that is both informative and brilliantly written.


On May 10 09:42 AM andypandy wrote:

> Ok I was wrong, it's a great video so far - first 20 min actually
> helped me understand me something new... Where does the money come
> from to pay interest to the federal reserve if they are the ones
> who make the money? Ha, have I not asked that question before?

Main U.S. Creditors Rub Shoulders

Pls check my archive about my opinion in 2005/6/7 when I did not conform with the bullish crowd either. Macro data signalled it all back then. The debt-to-GDP ratio surpassed its 1929 high in 2002. This mountain of debt will not go away without hitting the whole world.

anyway, I wish all commentators a happy holiday season, who offer their insights and do not let a mistake escape.


On Dec 16 03:44 AM aitvaras wrote:

> When there is a Consensus opinion from a majority of economists,
> the Prudent Investor does the opposite.

The Euro Has Significant Problems - And They're Likely to Worsen

Greenspan's Dog: The ECB is formally independent from the Eurozone members. Its shareholders are the Eurozone central banks. Second, it will not be able to come up quickly with a pan-European solution as the packages of various Euro members show. Thirdly, the ECB's balance sheet has grown some 50% this year alone. Leaning towards the Austrian school this is monetary inflation par excellence for me.

Österreichischer Adler: Thank you very much, the rest of Austria is still asleep and has no idea what may happen in the next weeks.

Equity Markets, Forex and Precious Metals

JP Morgan once said, "gold is money; everything else is credit." He did not mention that credit comes with today's rediscovered danger of counter party risk. Only PMs are a value in itself and not the obligation of another entity.