On 11 Mar, 15:43, "John Galt" <whoisjohng...@[EMAIL PROTECTED]
> wrote:
> <stuff_st...@[EMAIL PROTECTED]
> wrote in message
>
> news:171et3di4lsljdm74hnvqb93d00br6s2mt@[EMAIL PROTECTED]
>
> > On Tue, 11 Mar 2008 16:47:34 -0500, "John Galt"
> > <whoisjohng...@[EMAIL PROTECTED]
> wrote:
>
> >>What the Fed is doing now and what they did then could not be more
> >>different.
>
> > Except it's not. It's created a whole new entity to loan money out
> > with bonds as collateral. But the bonds are about 50% over rated.
> > They're trading good paper for bad. This is not going to end well.
> > IMHO.
>
> 1929 was a tight money Fed policy. Today is the opposite. Not the same.
> Today, the goverment is going with loose money and as you point out,
> absorbing risk. Today the exposure is topped at 200B, but since they're
only
> taking the AAA stuff (yes, I know....), one would *hope* that losses
won't
> top a point or two while restarting the credit market.
>
> If the taxpayer can restart the markets at the cost of 4 to 10B, it's a
> bargain. Should have done that instead of the 150B rebate.
>
> JG
yes and hyperinflation is much, much worse than deflation. everybody's
pension and savings are wiped out. society breaks down. i'm guessing
you've read the post on frugalsquirrels by the guy in argentina. this
is his advice -
"Having gone through a shtf scenario myself, total economical collapse
in the year 2001, and still dealing with the consequences, 5 years
later, I feel I can answer that question. YES, you need a gun, pepper
spray, a machete, a battle axe, club with a rusty nail sticking out of
it, or whatever weapon you can get hold of."
http://www.frugalsquirrels.com/ubb/ultimatebb.php?ubb=get_topic;f=49;t=000074
how close is the us to hyperinflation? well inetrnation accounting
std 29 says hyperinflation is when
" - the general population prefers to keep its wealth in non-monetary
assets or in a relatively stable foreign currency. Amounts of local
currency held are immediately invested to maintain purchasing power;
- the general population regards monetary amounts not in terms of the
local currency but in terms of a relatively stable foreign currency.
Prices may be quoted in that currency;
- sales and purchases on credit take place at prices that compensate
for the expected loss of purchasing power during the credit period,
even if the period is short; and
the ***ulative inflation rate over three years approaches, or exceeds,
100%."
http://www.iasplus.com/standard/ias29.htm
the us is heading that way fast.
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