the dark days are here, page-15

As they point out hyperinflation is a currency event, with all 14 of the central banks printing money and all of them having trouble getting it into circulation via the credit channels it hard to see the hyper inflationary event, hyper inflate against what ???? they are all tanned with the same brush, the USD is going to crash against what ? the chinese yuan? most of china's trade is settled in USD how are they going to run away from USD, stirling ? as they point out stirling is worse than USD? , Euro?........Most chinese trade is settled in USD for the USD to crash the Chinese would have to stop trading......................at present if the usd began to fall all 14 of the central banks would combine to save it, eventually China, India, Australia, Russia and the rest might find other means

http://news.bbc.co.uk/2/hi/business/8136066.stm

but to suggest everyone is going to run away from the only global medium of exchange at once is naive, as much as these guys have some deep insight into certain economic factors in play there has never been a global reserve currency crash in history thats happened in a few moments, comparisons to Argentina , Germany and Zimbabwe are totaly bogus, folks could run away from those currencies immediate because they we essentially only domestic currencies, they were not heavily used internationally as a currency

China accepts USD everyday as exchange for goods, what will it do with the USD it gets for exports, take it down their local Thomas Cook and exchange it?

There are massive amounts of USD flowing into China in exchange for the goods it exports, are folks suggesting that the Chinese will sell these USD as soon as they get them? what are they going to do with them? put them under their futons?

Folks completely underestimate the power that a reserve currency status brings, fi the dollar crashed the other central banks would simply begin buying it so their exports would not be impacted, most of the currency in the world is USD

http://en.wikipedia.org/wiki/File:Percentage_of_global_currency.PNG

As for the sloganeering here about worthless paper and the fiat currencies falling, come off it, there is enough currency in the world to fix the gold price many many times over and if that didnt work they would simply legislate against it

folks here sound like a bunch of religious zealots, worthless paper money might be a great slogan but who here would knock back a $1000 usd gift, or better a $1m USD gift, how much stuff could you buy with it. Paper money is worth as much as the market and people say its worth, to call it worthless is ridiculous, if it was worthless you wouldn't be able to use it. The slogans astound me "all paper money eventually falls to zero" yeah right ok maybe a 1933 German Mark but really it all falls to zero, folks have been reading fantasy books, Stirling has been around for 300 years, it was the currency of trade and its been back by gold then not back by gold and then back again

at what point did it fall to zero

Yes money printing and credit expansion is dangerous, over time it will ruin the US but to carry on like its all going to happen overnight and that somehow other currencies are better is ridiculous. its not the money printing that will ruin them anyway, the great ruin of all empires is not paper currency its debt, that fiat currencies allow, fiat allows debt to expand without limit, gold on the other hand theoretically puts limits on expansion, trouble is those limits only work until a countries economy is larger enough to hoard all the gold then there are no limits and credit ends up expanding without limit...........Spain was under a gold standard and collapsed spreaking inflation across Europe, so did the US in the 30s, the Great Depression happened under a gold standard, the problem was America had most of the gold and used it to speculate and create a credit bubble and asset inflation


Closer to the truth IMO is probably a major deflationary period that ruins nearly all the western economies, massive unemployment, massive drops in trade, it happens after every credit bubble, debt deflation creates demand for currency

Explained another way under fractional reserve banking a bank can get a $1 and multiply that dollar by 10/1 by lending that dollar out again and again. In a debt deflation this reverses, all that multiplier effect reverses when folks sell asset payu off debts

Here is is better explained than I can

http://www.marketoracle.co.uk/Article12008.html

excess industrial capacity is the logical consequence of the adoption of a fiat monetary system, Marx talked about it as the precursor to all revolutions. By extension, excess industrial capacity can only be maintained for as long as the debt burden can be expanded. Therefore, once the debt burden can no longer be expanded, then pricing power is lost; thus earning streams are compromised, thus unemployment rises, thus further impinging revenue streams thus, eventually, compromising government revenues (taxes). Once government is bankrupt and significant swathes of the population are out of a job and potentially hungry, any self respecting government will resort to the only honorable thing to do in these circumstances… they’ll start a war.

Any of the above sound familiar?

We are in way more trouble than any of you "OMG the train has left the station" gold zealots realise. Who cares whether gold is 950 USD or 10,000,000,000,000 per once, are any of you American ????? hold American assets?, how many have even been there more than once or twice?

OK MJ died but isnt it time to stop be obsessed with Americans? and yes he could dance but hell he was hardly someone to model a life after, they are the ones that got us all into trouble, yet everyone hangs on what some American commentator say?. Is this because you as an Australian feel inferior and cant think for yourself? Is it because you so invested in American culture you dont actually realise that your not actually American?

What if the American empire did end what would it mean to you? It wouldnt mean much at all.....except we might worry a lot more about upsetting the chinese...

end of rant :)







Anyway, the only way excess industrial capacity can be taken off line is by destroying it… and there is only one way to destroy industrial capacity.