New York Times:
Paul A. Volcker, former chairman of the Federal Reserve, warned on Wednesday the United States could face a 1970s-style period of skyrocketing inflation if investors lost confidence in the buying power of the dollar.
"If there is a real loss of confidence in the dollar, then I think we are in trouble. That is something that has to be watched," Mr. Volcker told the Congressional Joint Economic Committee.
Want to reply to a comment? Hint: Click "Reply" at the bottom of the comment; after being approved your comment will appear directly underneath the comment you replied to
What is inflation??? Most would say rising prices. WRONG! Rising prices are caused by inflation.
Inflation is too much money chasing too little in the way of goods and services. Or, some just say too much money. Well, folks, wake UP! Greenspam and Bernenke have had the pedal to the metal on monetary policy.......the world is awash in dollars. Greenspam cranked up the dollar machine to bail
out Wall Street after the dot.com implosion (you remember, when a company could go public, have NO earnings, and then have the price of the stock triple in a few days, or weeks). Now, Bernenke has cranked up the dollar machine again to bail out Wall Street, after the crooks there had their SIV/SubPrime/CMO scam collapse on them. The latest CPI numbers from BLS are the funniest things I have seen in 60 years. BLS tells us in these latest numbers that, year over year, the inflation rate is about 4 percent. Like hell.....the real inflation rate is in the 6-9 percent range. Sadly, there is no asset class that will save the American citizen today, unless you are a precious metal fan. Even that is no guarantee of success in beating inflation. Example: if one had bought an ounce of gold at peak price about 27 (odd) years ago, gold would have to be selling for over $2,000/oz today to just keep one even with inflation. Today, gold is at/a little under $900/oz.
What! I thought the 70s were Carter's fault like the wingnuts keep repeating. You mean we might have the same kind of meltdown, but worse, with the Republicans -- free market, no regulation, unbridled greed, sticking it to the common man? I thought all that was good for America!
What's good for GM is good for America -- of course, GM, GE, and every other G is laying to waste thanks to America's and this administration's missteps and utter hubris.
Isn't this headline like calling the earthquake in China a tremor? The economy cannot rebound as it is. People on fixed income who are the solid base of spending in the country now have nothing to spend. More and more people will be forced to sell their houses for less and less. Communities will have less tax bases which will effect services and cause increases in crime and lawlessness. The so-called free market economy (code word for corporate exploitation) is showing its ugly side.
70's ? It's going to be like the 1920's Weimar Republic, exponential hyper inflation followed by chaos. The " stimulus package " , the interest rate cuts and bailouts only increased the National Debt. When the hype wears off everyone will realize the Fed just made off with MORE of the taxpayers money and unfortunately the dollar will sink like the Lusitania. Xrepublican is correct. Gold should soon start it's upward march.
The question is whether we allow the entire "poisonous" sections of the financial system to collapse or throw good money after bad now. Then later with a new Administration in Washington, the entire financial, economic system comes undone as the managers of a debased currency are forced to step aside as interest rates go through the roof and they are blamed for doing nothing. We will pay for a hundred years the malefeasance in managing the economic and financial afffairs of this "sick man" of the world.
Late, too late, but then again, somebody states the obvious. Lordy, do we have to pull it out of them with a fire poker?
What is the hell is he talking about - are they that out of touch? 70's style inflation is here buddy.
He's not Cassandra. He's just a man. He can only see what is already apparent.
Has he even been to the grocery store lately? How about the gas station? Inflation is upon us NOW. It's only thru the manipulation of the data that the government has been slow on the uptake.
House price inflation existed in the 70's. The opposite is happening now. And we don't yet have the high interest rates. Question: If our money is worthless, how will Americans be able to buy houses again?
That 400 TONS of Gold the IMF sold to raise cash (or was it to make the $US dollar look better?) has pretty much been absorbed by the market. Dick doesn't have much left in uninvested cash reserves - or room in his underground vault - and W has ordered all new gold plumbing fixtures for Nuevo Crawford in Paraguay.
So look for the price of gold and silver to resume their exponential rise........
Wow... I NEVER thought ANYONE could screw up the US - acually, the WORLD, economy this bad......
Bush is giving the Weimar Republic a run.
I guess this is why M3 has been TOP SECRET for over a year.... doesn't look good when (in the last YEAR laone) you've printed another dollar for every five already in circulation
Hit the nail right on the head wit h that one. People have to invest on the pullback. Never mind hording dollars.
They are managing to do it, even after selling out labor.
Would they not be better off stopping the global development of monopolies?
Pic caption: $5, foot-long.
Or: This is how far up the economy's rectum I stuffed it back in the good old Reagan 80's.
lol
Loading comments…
First Posted: 05-14-08 09:32 PM | Updated: 05-22-08 05:12 AM