For those who still had any doubts about the FED’s monetary strategy and the future of the dollar, Ben Bernanke just reminded everyone he is ready to « print » (i.e. create more debt) as many billions of dollars as it takes to kick-start US growth (in other words, to save the banks).
QE1 and QE2 have had absolutely no effect on the unemployment rate in the USA, but Ben Bernanke just announced QE3, a plan entailing two things :
- Buying 40 Bn$ a month of MBSs (mortgage-backed securities) with no amount limits, no end date. It looks a lot like an infinite money printing plan...
- Keeping interest rates low until 2015.
>> FED’s announcement here.
Gold and silver didn’t take long to react, as shown by the two charts below :
There is no doubt that the two main banks owning enormous short positions in gold (HSBC) and in silver (JP Morgan) are now in dire straits. GATA’s Bill Murphy, by the way, is predicting a scandal as big as the Libor one, but in regard to the manipulation of the gold and silver markets. He thinks we should know more within a couple of months.
Right after the FED’s announcement, the dollar plunged. So the currency war is raging at full strength after the announcement of Mario Draghi’s BCE plan.
So the race for monetary debasement ( to help exports in the beleagered countries) is accelerating globally.
Let’s remind ourselves that all of the fiat currencies are losing ground in terms of purchasing power when compared with gold and silver. Some of them lose more when compared to other currencies, but when one analyses the price of gold in all currencies in the last ten years, one sees that all currencies’ buying power are being destroyed generally.
Gold and silver investors will fully benefit from those destructive monetary policies that are taking place on both sides of the Atlantic ocean and in Asia.
Unfortunately, 99% of the world population suffers from those policies with record inflation rates. Stuck between rampant inflation and growing taxes (said taxes to finance the debt of the banks), a growing segment of the population is getting poorer.
True revolutions only get under way when stomachs are empty... The central banks’ inflationary policies, while trying to bail out a perverse monetary system, are bringing about higher prices for commodities and are likely to cause tomorrow’s social upheaval.
"Insanity is doing the same thing over and over again but expecting different results." Albert Einstein.
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