Ron Paul knew it, I knew it, and every Conservative and Libertarian Blogger knew it.
The U.S. dollar’s thrashing on Thursday after a last-minute European deal to contain the debt crisis may have sealed the currency’s fate.
And it is all downhill from here.
The European agreement, which involves a 50 percent write-down of Greek debt and boosting the euro zone’s bailout fund to as much as 1 trillion euros, has averted a collapse in Europe and spurred a rush to risky currencies and assets once again at the expense of the dollar.
Add in to the mix: a suddenly revitalized U.S. economy that a few weeks ago was teetering on the verge of recession and had fueled speculation about another round of quantitative easing. Almost overnight it leaves a whole new global outlook that appears a little more encouraging.
This is what happens when the Federal Reserve prints money for Countries to bail out their debt crises. Ron Paul has said this for years and he is right —- about that anyway. This in turn devalues our currency and causes the prices of everything to go up. This also causes everyone to run to go Gold, which drives the prices through the roof, causing a bubble. The problem is, when the inflation goes back down, and Gold collapses, people lose money — unless of course, they have other investments to transfer that wealthy into, so they do not lose their money. If we could at least get control of the fed, this sort of stuff would not happen.
Another thing too, this right here ought to be the prime example of why Keynesian Economics does not work at all. Taxing and spending a way out of recession is just not the way to do it. Printing money out of thin air does not solve the problem; it only makes that problem worse. It does that by devaluing the currency that is being mass printed. I know, I am repeating myself; this is why I do not talk about the sort of stuff often, which is because I detest repeating myself repeatedly. I figure my little blog is not going to stop the world from plunging into madness, so why bother.