The Savings Gap - Americans Not Saving Enough for Retirement

[Kane]

Simply stated, the Fed is powerless to address the inequality driven by the recent crisis. That's fiscal policy baby.

[The Dude]

[The Dharma Bum]

One simply can't hold insolvency off forever by throwing borrowed money at it. The insolvency is the result of a underlying problem that this "solution" ignores.

Yes, the US gov has access to a lot of money but to assume that because of this they can just spend and spend with no ill effect is lunacy. The result if we continue in this manner will be a massive deflation followed by hyperinflation. The reason for this is the velocity of money is at a record low, and this in combination with the trade deficit (we are hemorrhaging cash to foreign entities, check out what Smith and Ricardo said about the result of "free trade" ) and decreased consumer spending (to which you attribute the lack of inflation).

The result of all this is the greatest debt bubble in history and when such a bubble bursts you will see credit tighten up, panic, and fear which will lead to massive deleveraging as people rush to cash in their assets.

You notice guys like Warren Buffet are into cash already? There's a reason, they understand this shit and and are going to use that cash to screw the rest of us when the debt bubble bursts by buying up everything at rock bottom prices. There will be enormous pressure for the government to do something (again) so they will adopt inflationary measure and that is when the inflation will begin in earnest.

[The Dharma Bum]

And that will likely be the end of the dollar as the worlds reserve currency.

[Kane]

[Kane]

[The Dude]

[The Dharma Bum]

[The Dharma Bum]

[The Dude]