Inflation not the worry says Bernanke
Bernanke said, ”The Federal Open Market Committee will be carefully evaluating incoming information bearing on the economic outlook and will act in a timely manner as needed to support growth and to provide adequate insurance against downside risks.”
What this means is that the Fed and the Federal government fear deflation and recession much more than inflation. Thus, they will sacrifice the dollar to post pone recession. I say "postpone," because their solution is to pour more gasoline to put out the fire. It is their joint policy of easy credit flooding the economy with dollars which has created the mess we are in now. What will more of the same mean, but a greater problem. At the very best, it may buy a few more weeks or months.
The consumer spending, though somewhat less, is masked by the higher prices paid at the pump, for heating & cooling, and for virtually all consumables gives the illusion of greater spending. The higher prices for what we consume results in false picture of spending compared with prior spending. The dollar is worth less now than it was in the past. Their policy of more dollars will make the dollar worth less in the future.
At the same time, the loss of purchasing power of the dollar is resulting in an increase in the dollar cost of almost all natural resources, including the precious metals. By the way, Gold closed at 974.30 and Silver at 19.81 on Friday. It is important to know that the price of gold, silver, and platinum has increased in terms of all paper currencies.
There is a great demand, in particular for gold among the people in China and India. These populations are becoming more affluent, and they are more aware of the value of the precious metals than are most of us in America.
I pray that each of you is well positioned now in the precious metals for preservation of wealth and in mining stocks or the sector mutual funds for the leverage they provide.
Will have more to write in another post this week end. Keep your focus upon the Lord Jesus Christ and prepare for corporate worship tomorrow.
Best to each, Doug
What this means is that the Fed and the Federal government fear deflation and recession much more than inflation. Thus, they will sacrifice the dollar to post pone recession. I say "postpone," because their solution is to pour more gasoline to put out the fire. It is their joint policy of easy credit flooding the economy with dollars which has created the mess we are in now. What will more of the same mean, but a greater problem. At the very best, it may buy a few more weeks or months.
The consumer spending, though somewhat less, is masked by the higher prices paid at the pump, for heating & cooling, and for virtually all consumables gives the illusion of greater spending. The higher prices for what we consume results in false picture of spending compared with prior spending. The dollar is worth less now than it was in the past. Their policy of more dollars will make the dollar worth less in the future.
At the same time, the loss of purchasing power of the dollar is resulting in an increase in the dollar cost of almost all natural resources, including the precious metals. By the way, Gold closed at 974.30 and Silver at 19.81 on Friday. It is important to know that the price of gold, silver, and platinum has increased in terms of all paper currencies.
There is a great demand, in particular for gold among the people in China and India. These populations are becoming more affluent, and they are more aware of the value of the precious metals than are most of us in America.
I pray that each of you is well positioned now in the precious metals for preservation of wealth and in mining stocks or the sector mutual funds for the leverage they provide.
Will have more to write in another post this week end. Keep your focus upon the Lord Jesus Christ and prepare for corporate worship tomorrow.
Best to each, Doug
posted by Doug @ 8:41 AM
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