CIGA JB Slear
Jim Rogers said the next to come is an “inflationary holocaust.” This was taped last week. The salient comment, past half way into his interview, dovetails what you often have written about. The agreement you have is that monetary inflation is the cause and precursor of price inflation regardless of the level of business activity. The greater the amount of money and the shorter the time in history to inject this infinite floods of dollars result in a “inflationary holocaust” quite soon.
Today every political and financial interviewer pulled out a host of Nobel Laureates, Professors, Dean of Business Schools, former Secretaries of the Treasury and other well known equity professionals to high five and applaud the G7 accomplishment of flooding the world with dollars.
Speaker of the House Pilosi got into the act by rehashing the hash of the bailout. She was sure to emphasize the line “do more.”
The answer that governments apply to all situations is to throw cash in dollar swaps in the trillions as a off balance sheet injections.
How did Einstein define insanity? I believe he said it was doing the same thing repeatedly while anticipating different results. The government is doing the same thing that created this crisis and is apparently anticipating different results.
As Jim Rogers says, we are bailing out 29 year old brats driving Maserati’s who we know are the manufacturers of mountains of OTC derivatives. The actions of these brats will end (via what was done this weekend) the financial world as we know it.
The inflation that is heading towards us without regard to the level of business activity is WILD.
I am not concerned that gold will fail to trade at $1650 by January 11, 2011. My concern is that it might be much higher.