Think back to 2007, when the Bush administration announced that budget deficits would expand to $450bn. There were howls and screams - how would it ever be paid back? It was going to kill the economy. They'd need to print massive amounts of dollars to pay for it. Who would lend it to them?
Now, think about what Obama has said in the last couple of days. This year's budget deficit (excluding the TARP funds) will be $2 trillion. His aim? To halve it, down to $1trn pa, by the end of his present 4 year term.
Can you even begin to imagine the inflation this will cause? Once the markets fully digest this proposition, can you imagine what will happen to the USD, to treasury yields and, most importantly, to gold?
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- massive us inflation in the pipeline
Think back to 2007, when the Bush administration announced that...
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