Our leaders in Washington are so detached from reality, I am thoroughly convinced they are smoking some strange stuff. And if they're not, then they're pathological liars, full of nothing but hot air and B.S.
Mind you, I'm not even talking about their inability to cut reckless spending, or the patently unpayable debts and promises they've made, not only to the American people, but also to our foreign creditors.
Nor am I even talking about the intentional neglect of the dollar, which continues to sink in value, eroding your wealth like never before.
Consider the following B.S. Washington has been feeding you:
From the end of 2000 through the end of 2010, the ridiculous Consumer Price Index shows prices have risen 29.9% for an average annual increase of about 2.99%.
The fact is inflation is not running at 3%. Nor is it even 5%.
Just take a look at this table, courtesy of the theburningplatform.com:
Look at housing. Combined, the typical cost of homeowner's insurance and real estate taxes, two basic unavoidable costs of owning a home and putting a roof over your head undefined have increased an average of 92.5%!
The cost of energy, averaging the price gains for heating oil, natural gas, and electricity undefined has soared 87.67%.
The cost of a gallon of gas for your car has jumped 118%!
Medicare Part B premiums have rocketed 143% higher!
And, some of the very basic food items we buy on a regular basis undefined potatoes, eggs, beef, bread undefined they too have soared, rising more than 64% in the same period.
Overall, according to this table, prices have increased 88% since the year 2000 undefined a rate of inflation that's three-times greater than what the government is telling you.
To make matters worse, the pundits in Washington continue to claim that inflation is "not a problem" ... "tame" ... and that it will be "easy to deal with."
Give me a break! Anyone with half a brain can see that prices are going up all around them.
Plus, it's bound to get worse. Consider a few examples of what's happened with prices so far this year, in merely nine weeks:
Oil is up 17.3% ...
Heating oil is up 27.3% ...
A pound of coffee is up 13.6% ...
Cocoa is up 21.5% ...
Corn is up 16.8% ...
Cotton is up 55.1% ...
Again, only in nine weeks!
Now, you tell me, does that look like annualized inflation of 3%? Or even 9%?!
I don't think so! The average price appreciation of the above, pretty much staple items, is almost 20%.
Meanwhile, the value of the U.S. dollar continues to lose purchasing power. So that means even more inflation is coming down the pike. And lots of it!
So I urge you undefined no, I implore you undefined do NOT buy into the low inflation nonsense!
If you do, the money you've worked so hard for will disintegrate right before your eyes. It will crumble in value, just like the U.S. dollar is inevitably going to continue to do ...
The U.S. Dollar Now Sits
On the Edge of the Worst
Currency Crisis of All Time
There have been dozens of currency crises over the last several hundred years.
But until recently, currency crises were confined primarily to either emerging third-world economies or fascist political systems such as Germany and Italy in World Wars I and II.
Now, the currency of the world's foremost superpower is about to enter its next leg down.
Already, in just the past couple of months, we've seen the sickly euro gain almost 8% against the dollar. We've seen the Swiss franc soar to one record high after another, surging more than 7% since early December.
Even the British pound, the currency of a nation that's spiraling deep into a recession, has soared against the dollar, jumping more than 6% since the first of the year.
Against most Asian currencies, the dollar remains at or very near new record lows.
You can see the dollar's weak performance in this chart of the Dollar Index. Notice how the dollar has lost 14.9% since June ... more than 4% just since the beginning of this year ...
And how the Dollar Index now sits on a vital support level, which if it gives way, as I suspect it soon will ... would likely usher in a crash.
So, to me, it's perfectly clear that ...
Our foreign creditors are increasingly getting upset with our profligate ways ...
Our foreign creditors and trade partners no longer view the dollar as the world's kingpin currency ...
That Bernanke, Geithner and even Obama and Bush had a plan all along undefined to neglect the dollar, let it depreciate, and try to inflate our way out of the mess we're in.
And all the talk about "rebalancing the global economy" is nothing but a ruse, and just another way of saying ...
"We must devalue our lifestyles, so that we can afford to pay off our debts." Or ...
"We must get the rest of the world, especially China, to spend more, while we devalue our lifestyles."
Or, "We must transfer our wealth to others in the world, because, we cannot pay them off as we had promised!"
Take it whichever way you want. The fact of the matter is that all the talk about "rebalancing the global economy" undefined from the likes of Bernanke, Geithner, Obama, or any politician for that matter who subscribes to that view undefined is nothing more than code speak for devaluing the dollar.
That's why I have absolutely zero doubts that the dollar will continue to lose value ... that it WILL be substantially devalued against the Chinese yuan ... and that the dollar IS going to lose its reserve status.
I may have been one of the first to alert you to the scheme Washington has in mind to devalue the dollar, and to inflate away Washington's patently unpayable debts and IOUs.
But I'm not the only one. Consider these other notable people and what they have to say ...
"It's the ... official policy of the central bank and the United States and to ... debase the currency." undefined Jim Rogers, Co-Founder of the Quantum Fund
"The current crisis is ... it's basically the end ... of a 60-year period of continuing credit expansion based on the dollar as the reserve currency." undefined George Soros, The world's #1 global investor
"Holding dollars today represents risk ... without ... reward!"
undefined Joseph Stiglitz, Nobel Prize-winning economist
Also note the following excerpts from Dr. Barry Eichengreen, one of the world's foremost economists and currency experts, Professor of Economics at the University of California, Berkeley undefined from his recently published articles in the Wall Street Journal, and his newly published book, Exorbitant Privilege: The Rise and Fall of the Dollar and the Future of the International Monetary System.
"The dollar's reign is coming to an end.
"All three pillars supporting the dollar's international dominance are eroding.
"First, changes in technology are undermining the dollar's monopoly.
"Not so long ago, there may have been room in the world for only one true international currency. Given the difficulty of comparing prices in different currencies, it made sense for exporters, importers and bond issuers all to quote their prices and invoice their transactions in dollars, if only to avoid confusing their customers.
"Now, however, nearly everyone carries hand-held devices that can be used to compare prices in different currencies in real time. Just as we have learned that in a world of open networks there is room for more than one operating system for personal computers, there is room in the global economic and financial system for more than one international currency.
"Second, the dollar is about to have real rivals in the international sphere for the first time in 50 years. There will soon be two viable alternatives, in the form of the euro and China's yuan.
"China, meanwhile, is moving rapidly to internationalize the yuan, also known as the renminbi. The last year has seen a quadrupling of the share of bank deposits in Hong Kong denominated in yuan. Seventy thousand Chinese companies are now doing their cross-border settlements in yuan.
"Finally, there is the danger that ... foreign investors will be reluctant to put all their eggs in the dollar [and that] ... the dollar will have to share its safe-haven status with other currencies."
I disagree with Dr. Eichengreen on the end result, a tripolar world reserve currency made up of the dollar, the euro and the yuan ...
And instead, I believe a single world currency based on a basket of commodities should be designed for all international trade.
While we disagree on how it will take shape, there's no question in my mind that Dr. Eichengreen is right as rain, and that the dollar is going to lose its reserve status.
Don't kid yourself, or let anyone else fool you.
The fact of the matter is that Washington
has known this all along.
They know what the economist John Maynard Keynes said so well, more than 90 years ago, that ...
"By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens ... in a manner which not one man in a million can diagnose."
