
What do you think? "Prepare For The Hyperinflationary Great Depression" - chaostheory
http://www.zerohedge.com/article/shadowstats-john-williams-prepare-hyperinflationary-great-depression
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anigbrowl
Not much. Hyperinflation is the nerdocalypse for those who don't believe in
Keynesian economics, but comparisons with Zimbabwe or the Weimar Republic are
absurd and overblown.

What does he think the US Dollar is going to be debased in comparison to? The
Euro? Europe has pretty severe structural problems of its own, and Britain is
both tiny and worse off again. Russia and Japan are stable but rather
moribund, and while Brazil is a bright star int he world economy these days
it's tin in comparison to the US economy. Which leaves the Yuan, and China is
going to leave its currency pegged to the dollar for as long as they feel like
it, both because it keeps the trade balance stable and because they have no
intention of letting us inflate away our debt.

Oh yeah. Gold. Riiiiiight. Look, we still have tremendous amounts of wealth in
the US, though you might not feel that way if you're in Detroit or some other
towns. If the Chinese ever grow anxious about having too many dollars on the
books, they're not going to start demanding they be paid in gold ingots,
they're going to do what the Japanese did and just come over here and start
buying blocks of Manhattan or Downtown LA or whatever prime real estate they
can pick up for a song (which will be most of it, in the next year or two -
commercial RE is in a slump of its own).

Hyperinflation makes no sense for the US because there is no harder currency
that can easily displace the dollar, and there are vast numbers of valuable
assets which are most easily purchased in dollars here in the US as far as our
external creditors are concerned. Internally our debt-to-GDP ratio is rising
but not that bad in context, and the administration has already expressed
interest in deficit reduction so it's not like they're oblivious to the issue
(unlike the previous administration with their proclamations that 'deficits
don't matter').

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mark_l_watson
Long term, our government can either default on its debt (I doubt this will
happen) or use massive inflation to reduce the effects of debt (this is what I
think will happen).

I think that it is impossible to predict when this will occur and whether it
will be rapid (hope not!) or gradual (my hope).

Both W. Bush and Obama spent way too much money on credit. If you as an
individual are going to to buy a car for $20K and pay for it over a 5 year
period, you should not say "this car cost me $20K," rather, it is really more
accurate to say "this car is costing me about $28K with interest." It would be
nice, but unexpected, if instead of the government saying "we are going to
spend $500 billion on defense this year" they would be more honest and say
"defense spending this year, including interest on the money spent, is
estimated to be between $1 trillion and $1.5 trillion."

Doesn't that sound a bit more honest?

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iterationx
Eventually China will stop buying our treasuries, they are already discussing
it, <http://www.foxnews.com/story/0,2933,487245,00.html>, then the government
will have to drastically cut spending or inflate the monetary supply. No one
seriously believes they will cut spending.

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joeycfan
Correct. The dollar is finished - the USA will undergo at LEAST 100 % price
increases realsoonnow.

The country might break apart. The sign is, when the Mexicans seize
California, as they have been saying they will do for a while, America is
through.

And when I say Mexicans, I don't mean the ones in Mexico - I mean the ones in
the USA illegally right now.

The price of oil will go through the ceiling - in terms of USD - and America
will stop.

Then - there's gonna be a war.

Not one of the TV wars like Vietnam, but one of those everyone-is-invited wars
like WWII. After that, who knows whats gonna happen.

History will record three 'Inexplicable American Madnesses' that caused all
this.

1 - The USA removed it's trade barriers to China thereby destroying it's own
industrial base even though they knew it would happen.

2 - America bankrupted itself fighting Israel's enemies for it just when it
needed everything it had to fend off the results of the first mistake.

3 - America permitted 20 million illegal immigrants into it's territory, even
though they said they'd seize California - and they did.

We are living in interesting times.

~~~
mahmud
Do you have any evidence for these bold claims? the world might be interested
in hearing what you have to say, provided you have proof, and not just
polemic.

