Elaine Supkis

Evidence That Big Inflation Is Coming

Oil is going to go up. By the way, who is the person who rates these comments? Not very good choices, I might suggest.

But this isn't my own site! To go back to 'deflation/inflation' we can have both at the same time! Isn't that amazing?

For an obvious example: housing was inflating rapidly from 2003 to 2007. Then, it rapidly deflated. Oil was deflating from 1994-1999. Then it began to inflate. Consumer goods dropped in price and deflated from 1994-2004. But then it began to inflate. For example, plywood from Canada was $3.50 a 4x8 sheet quarter inch and shot up to over $9 a sheet and now has fallen to $7 a sheet.

All of these things, incidentally, are part of our TRADE DEFICIT. This mostly grows and grows and grows. We take on more and more debt to service this trade deficit. Now, we can't take on more debt, the trade is falling but is STILL in a deficit.

As I keep saying, the true thing at work here isn't 'how much money is being printed' but 'what is going on in trade?' I may be the only person saying this, but this see saw of prices is very much balanced on the fulcrum of trade.

Evidence That Big Inflation Is Coming

EMS News here!

Look, inflation happens only when the working class has extra paper money to spend on whatever they spend it on. There are several different levels of 'inflation': buying things on credit, buying things one needs to survive and savings levels.

Easy credit at the BEGINNING of a bubble leads to manic bidding up the prices of various things such as fancy cars, properties, etc. The wealthy use this easy money to bid at art auctions, buy mansions, pay for ritzy prostitutes. The lower classes buy season tickets to sporting games, go to Vegas to gamble or go on vacations or get divorced [heh].

When debt builds up to the point that no one can afford to pay even Zero Interest Rates [ZIRP] we get a depression. The government, very early on tried to elevate spending artificially by giving all Americans $600. This led directly to a sudden and very destructive series of commodity bubbles that rose very rapidly from February, when the first money was mailed, to August, when the last checks were spent.

Virtually every penny of the 'free' bonus was soaked up by the sudden inflationary surge. Now, the deflation spiral is back and much nastier. The US is trying to do what Japan did when it had a huge credit bubble: keeping the zombie banks alive while trying to use government debt to float the entire economy.

Japan is now very deep in debt due to this. Debt owed nearly totally, 87%, to the Japanese. We are mired deep in debt to the Japanese and Chinese, not to ourselves. So all our government spending is turned into future tax obligations to our most dangerous trade rivals.

The simple question of 'deflation or inflation' has to be viewed from a global trade perspective to see where our real dangers lie. The US can't 'create money out of thin air' without getting totally entangled with our largest trade partners and creditors. All the fiddling we are seeing are being watched by these two dragons who will leap on us the minute we choose the 'inflate the currency' option and the dollar nosedives against the yen and yuan.

It is already diving against the yen and it 88 yen to the dollar! The Japanese prefer to have it at 120 to the dollar. Which is where it was at in July, 2007, back when the Japanese carry trade went suddenly into reverse.

Gold is neary $900 per ounce. But has barely budged in the last two months if you compare this to how many yen buys the same amount of gold! We are seeing the differential in the dollar, falling, rather than gold rising.

OPEC, being a consortium, a loose one, at that, always lags behind when it comes to cutting off the spigots when there is an economic downturn. But they will catch up with it, pretty soon. And then the one thing that can trigger global inflation will take off. For oil is the fundamental basis of all commodity and manufacturing pricing inflation. It doesn't affect property or equity values, right away. But it certainly has a very powerful effect on everything else.

High oil prices is the nightmare of world trade. It eats profits in industry and prevents customers from being able to take on more debt as they struggle to pay for food and energy.

Enlightening the Gold Bugs

This is what happens when writers write with no reference to history! Gold was not considered valueless in the Great Depression: quite the opposite! The gold reserves in the US were being drawn rapidly down when FDR, after assuring everyone before hand, slammed the door shut. One entity hoarding gold via US dollars was FRANCE.

You see, France finished this huge, underground vault in Paris. They thought the Germans would never get this gold. Ahem. Herr Hitler did, incidentally.

Anyway, the manipulations of the gold markets by FDR were to protect what remained of our gold at Ft. Knox. And more importantly, at the secret Federal Reserve vaults in NYC.

Gold was so important, FDR, like Hitler and the British Crown and nearly everyone, made gold hoarding ILLEGAL. If you tried to use gold to do business, it was confiscated! And you were jailed. The $35 gold price was to flush out all the gold held by individuals and above all, businesses. They were then FORCED to use paper no matter what.

Some people protested this by using spare change to buy and sell. A thousand silver half-dollars, for example. The government squelched this, too. The harsh truth isn't 'is gold worth something' but 'how will governments grab it no matter what?'

And this is where gold bugs go off the cliff: they imagine the government will come, hat in hand, to beg for the gold and pay top price. This will not happen.

When money evolves to zero worth, governments always shift to open confiscations. I wonder why so many people never mention this? HAHAHA. Never.

Flying Bankers and the Economic Crisis: How Do We Make Banks Lend?

Culture of Life News here!

Banks were lending money that came back from Asia as Japan and China were buying our Treasuries, our Fannie Maes, etc. In return, we let Asia overwhelm our domestic markets with their value-added exports. We then ship raw materials to Asia.

This is the way a third world commodities nation operates, not an industrial power. The lack of lending is due to our nation being BANKRUPT. We are too deep in debt. Period.

Fixing this is not impossible: we need tariffs and barriers to manufactured goods as well as higher interest rates to encourage savings, not buying of say, gold, and hoarding it.

The US banking system has not attracted savings for several years, our national savings rate has been negative ever since Greenspan dropped interest rates to 1%. Now, Bernanke is dropping it to nearly 0%. This means, savings will collapse even worse.

So there can be no lending since there is no capital flowing into banks that can support any sort of lending. The money the Fed is giving the banks is NOT savings. The US has virtually no FOREX reserves unlike any of the Asian nations.

Indeed, Japan and China both have between them around $3 trillion in FOREX reserves! The US has less than $60 billion. This is absurd. And unsustainable for a nation which presumes to be the global monetary giant.

No analyst should avoid the issue of trade and FOREX reserves when talking about our economic decline and fall.

Powerful Strengths, Pathetic Weaknesses, and What Donald Coxe Recommends

Like so many pundits, Mr. du Plessis doesn't bother to go look into history.
elainemeinelsupkis.typ...

At my story, 'PPT Rescues Are IDENTICAL to PPT Rescues In 1931'
I found a 1931 Time Magazine article that discusses all the rescues pulled by Herbert Hoover.

They are, down the line, exactly the very same rescues launched this last year by Bernanke and Paulson! There is nothing new under the sun.

The fundamentals of the crashing banking system have not changed. These are very unbalanced global trade with the US empire being the main destination of most exports while being able to pay for this with only fiat currency creation and of course the fake interest rates being foisted on us by central bankers.

Japan has inflation of over 2% a year and still lends at sub-1% rates. This is pure insanity. The US simply lies about inflation and it is far, far higher than the official rate of 4%. And the Fed is lending banks money far below this fake interest rate.

And on top of all this, all the G7 nation's governments are overspending and thus, borrowing money. This is massive money creation at work since borrowing=money creation out of thin air. We have too much credit being given to too many who are too deep in debt. Just like with the Great Depression.