TheOraclePaul
10-23-2008, 06:39 PM
For those of you who are wondering why the US Dollar appears to be getting stronger despite the inflationary policies that are being implement, please read the following. If you want to read more, please visit this website (I am not the creator of this content): http://www.theinternationalforecaster.com/International_Forecaster_Weekly/Insider_Profiting_Will_Bring_The_Hyperinflation_Ju ggernaut
Well, how 'bout that high-flyin' dollar? You might even believe that it was still the world's reserve currency, which it still is, in a de facto sort of way, given that all the other world fiat currencies are in even worse shape, aside from the Swiss franc. You are probably wondering what has propelled it to the 85 mark on the USDX? Many factors are involved, all the direct result of manipulation by the PPT and the cartel. But the irony is that the upward swing in the dollar is actually not the new beginning for a bull market rally in the dollar, but rather, this new push upward portends that the dollar is now singing its swan song. Most, if not all, of the events that are driving up the dollar are going to eventually take down our financial system, along with the entire world economy, and the dollar will go down with them, along with all other non-gold-backed currencies, with the exception possibly of the Swiss franc. Gold and silver will be headed for the Fifth Dimension when that happens.
So how are they propping up the dollar aside from the usual direct intervention in the currency markets? First, the PPT and their Illuminist masters have withdrawn their support periodically and have allowed the markets to enter into a period of fear and instability to enhance volatility and thus insider trading profits for Illuminist insiders. They have allowed markets to crash out of control, sending everyone scurrying for treasuries in the US, Canada and Europe, while Asia runs to the equally spurious security of Japanese bonds. This piling into Japanese bonds, which requires foreigners to purchase yen, has thus strengthened the yen and triggered a new detonation of the Yen Death-Star, which will soon totally destroy the Japanese economy, or rather, what is left of it, as the price of their exports reach astronomical levels. A month ago, the yen stood at around 106 yen per dollar and 156 yen per euro. This morning, Wednesday, those numbers were about 99 and 127, respectively. That's 7 yen per dollar, and very nearly a banzai 30 yen per euro in one month! And you wonder why people are liquidating and de-leveraging, which would include precious metals positions?
So everyone is running for the perceived security of US treasuries. The carry traders, institutional investors, professional and amateur individual investors, hedge funds, sovereign wealth funds, mutual funds, money market funds, holders of US agencies, you name it. Any foreigners who want to purchase treasuries must buy dollars, and that is the major support we are seeing in the current dollar rally. This is not a very good scenario for our economy and it will only get worse as real estate, credit-crunch, derivative and consumer spending debacles grow ever more fearsome. Meanwhile, the advance of the dollar keeps steady downward pressure on gold, which is JOB ONE at the Fed. For many months now, this is what we have described as stock markets coming down with "yellow fever," meaning that the stock markets look sickly because they are being sacrificed to push money into treasuries, thereby supporting the dollar and suppressing gold.
Also, by suppressing gold through various means, they are discouraging gold and encouraging treasuries as the safe-haven of choice. This keeps money pumping into treasuries, thus supporting the dollar, and the value of treasury bonds and other debt tied to treasury rates. Remember, the bond markets are the seat of Illuminist power, and they are about to crumble at any moment, thus paving the way for the worst bear market in bonds in our nation's history. That is because, unfortunately for the elitists, this increased demand for treasuries drives their rate of return down to extremely low levels to the point where no one will want them anymore because they know that real inflation is in double digits and is about to get much worse as the bailout dollars flood the world economy with worthless paper. By driving money into treasuries and by supporting the dollar, the elitists are trying in vain to delay the destruction of the bond markets.
Second, note how the European nations are swapping their currencies for the dollar, and then using the dollar to support their financial system and institutions. These nations are buying dollars with their domestic currencies, and that is what has driven the dollar to 85 on the USDX. Their currencies are being parked with the Fed, thus preventing their currencies from being debased at the expense of the dollar. Most of that $2.3 trillion in European bailout money will be spent in the form of dollars. Add in the $150 billion stimulus, the $700 billion Paulson Ponzi Plunder Plan, the $150 billion in Paulson Ponzi Plunder Plan pork, $300 billion for a new stimulus package, $175 billion for Bear Stearns and AIG, $2.5 trillion to bail out Fannie and Freddie toxic waste losses, $1.8 trillion to bail out losses on other toxic waste not guaranteed by Fannie and Freddie ($2.5 trillion minus $.7 trillion), and you have just over $8 trillion dollars in losses that will be paid for by digital dollars created out of thin air and backed by nothing. And we have not even touched on credit default swaps and interest rate swaps, the losses from which could far exceed that $8 trillion figure. And let's not forget the half a trillion budget deficit, hundreds of billions in trade deficits which will get worse as the dollar strengthens and makes US good more expensive overseas, and the hundreds of billions that will be pumped in to support the phony "War on Terror" in Iraq and Afghanistan. Who we ask, will buy all the treasury paper that will be needed to fund this madness? Not many, so most of it will be monetized, which is immediately inflationary. Every move the Fed makes, especially the recent .5% reduction in its Funds rate, along with the upcoming eventual reduction of the Fed funds rate to 0%, is begging for hyperinflation/hyper-stagflation as we continue on our Bataan Death March in pursuit of Japan's ongoing nightmare journey into economic oblivion. You asked for it, you got it, Toyota.
Third, the PPT has driven oil down, both by direct intervention in the oil markets, but also via SEC strong-arming of specs by threatening to take away their profits from shorting and by forcing them to publicly disclose their short positions. This was a commodity wide ban on the specs under this threat, not just on precious metals trading. Note that a month ago today, the USDX stood at about 76 and oil topped out at $130. Now, we have a USDX of 85 and oil at $70. This means that the number of petrodollars being converted to euros, the preferred currency of OPEC nations, has been essentially cut in half, taking a huge amount of pressure off the dollar. This is known as the "euro effect." The euro was at $1.60 at one point, now it is at $1.28, and small wonder. This downturn in oil has lent tremendous support to the dollar, but it has devastated the Russians and the OPEC nations who also happen to be big gold buyers, which is hardly a coincidence. And, of course, weaker oil makes gold less attractive as a hedge against the high cost of energy.
Fourth, the overall commodity downturn, which has occurred through de-leveraging, liquidation and margin call pressure caused by de-leveraging, plunging stock markets, the unwinding of the carry trade and the chasing of large specs out of the paper commodity futures markets via SEC strong-arming and obnoxious PPT manipulation, is meant to hide the effects of inflation being caused by the bailouts, but such effects will soon be impossible to hide. The elitists are playing on the common misperception that falling price means inflation is being reduced, or is "moderating" as Buck-Busting Ben would put it. This is the excuse they need to keep pushing the Fed funds rate down until it hits 0% so they can continue their efforts to save the fraudsters and keep their precious sheople-bilking system afloat. But all that is really happening here is that money is being transferred from one place, the commodity markets, to other places, like treasuries (as a safe-haven for savings) and banks (via margin payments and debt de-leveraging).
If parked in treasuries, or hoarded in banks, the dollars from the commodity and stock market sell-offs are temporarily neutralized (some use the term "sterilized") just as happens when foreign central banks print and inflate their currencies to buy up their surplus dollar forex to purchase, and then park, those dollars in US treasuries, thus keeping their currencies artificially weak and reducing the cost of their exports. In this case, instead of exporting our inflation to other nations by selling our treasuries, which are now too numerous to pawn off on other countries, we are keeping that inflation here, but it is being kept under wraps as potential, as opposed to ongoing, inflation. But as our money supply increases with the multiple trillions in bailouts, and the trillions in money and credit which the Fed keeps pumping into the system via its now numerous facilities as M3 continues to rampage, all of which will manifest itself as hyperinflation in 6 months to 1 year from now, the pressure to bail out of treasuries will reach critical mass and the whole world is going to run for the exits at once. Then all those parked and hoarded dollars are going to come back to haunt us with a vengeance, and we will be completely, utterly and immediately Weimarized as everyone tries to grab as many tangible, real US assets as they can get their hands on. We will literally be awash in dollars, as if a dollar tsunami had just been unleashed by a Force 10 earthquake. We also expect to hear more threats from OPEC nations to break dollar pegs as the price of oil continues its downward spiral, and this could be the straw that breaks the camels back. If you don't own gold, silver and their related assets when this mega-tsunami hits, you will get wiped out completely by the hyperinflationary juggernaut.
Well, how 'bout that high-flyin' dollar? You might even believe that it was still the world's reserve currency, which it still is, in a de facto sort of way, given that all the other world fiat currencies are in even worse shape, aside from the Swiss franc. You are probably wondering what has propelled it to the 85 mark on the USDX? Many factors are involved, all the direct result of manipulation by the PPT and the cartel. But the irony is that the upward swing in the dollar is actually not the new beginning for a bull market rally in the dollar, but rather, this new push upward portends that the dollar is now singing its swan song. Most, if not all, of the events that are driving up the dollar are going to eventually take down our financial system, along with the entire world economy, and the dollar will go down with them, along with all other non-gold-backed currencies, with the exception possibly of the Swiss franc. Gold and silver will be headed for the Fifth Dimension when that happens.
So how are they propping up the dollar aside from the usual direct intervention in the currency markets? First, the PPT and their Illuminist masters have withdrawn their support periodically and have allowed the markets to enter into a period of fear and instability to enhance volatility and thus insider trading profits for Illuminist insiders. They have allowed markets to crash out of control, sending everyone scurrying for treasuries in the US, Canada and Europe, while Asia runs to the equally spurious security of Japanese bonds. This piling into Japanese bonds, which requires foreigners to purchase yen, has thus strengthened the yen and triggered a new detonation of the Yen Death-Star, which will soon totally destroy the Japanese economy, or rather, what is left of it, as the price of their exports reach astronomical levels. A month ago, the yen stood at around 106 yen per dollar and 156 yen per euro. This morning, Wednesday, those numbers were about 99 and 127, respectively. That's 7 yen per dollar, and very nearly a banzai 30 yen per euro in one month! And you wonder why people are liquidating and de-leveraging, which would include precious metals positions?
So everyone is running for the perceived security of US treasuries. The carry traders, institutional investors, professional and amateur individual investors, hedge funds, sovereign wealth funds, mutual funds, money market funds, holders of US agencies, you name it. Any foreigners who want to purchase treasuries must buy dollars, and that is the major support we are seeing in the current dollar rally. This is not a very good scenario for our economy and it will only get worse as real estate, credit-crunch, derivative and consumer spending debacles grow ever more fearsome. Meanwhile, the advance of the dollar keeps steady downward pressure on gold, which is JOB ONE at the Fed. For many months now, this is what we have described as stock markets coming down with "yellow fever," meaning that the stock markets look sickly because they are being sacrificed to push money into treasuries, thereby supporting the dollar and suppressing gold.
Also, by suppressing gold through various means, they are discouraging gold and encouraging treasuries as the safe-haven of choice. This keeps money pumping into treasuries, thus supporting the dollar, and the value of treasury bonds and other debt tied to treasury rates. Remember, the bond markets are the seat of Illuminist power, and they are about to crumble at any moment, thus paving the way for the worst bear market in bonds in our nation's history. That is because, unfortunately for the elitists, this increased demand for treasuries drives their rate of return down to extremely low levels to the point where no one will want them anymore because they know that real inflation is in double digits and is about to get much worse as the bailout dollars flood the world economy with worthless paper. By driving money into treasuries and by supporting the dollar, the elitists are trying in vain to delay the destruction of the bond markets.
Second, note how the European nations are swapping their currencies for the dollar, and then using the dollar to support their financial system and institutions. These nations are buying dollars with their domestic currencies, and that is what has driven the dollar to 85 on the USDX. Their currencies are being parked with the Fed, thus preventing their currencies from being debased at the expense of the dollar. Most of that $2.3 trillion in European bailout money will be spent in the form of dollars. Add in the $150 billion stimulus, the $700 billion Paulson Ponzi Plunder Plan, the $150 billion in Paulson Ponzi Plunder Plan pork, $300 billion for a new stimulus package, $175 billion for Bear Stearns and AIG, $2.5 trillion to bail out Fannie and Freddie toxic waste losses, $1.8 trillion to bail out losses on other toxic waste not guaranteed by Fannie and Freddie ($2.5 trillion minus $.7 trillion), and you have just over $8 trillion dollars in losses that will be paid for by digital dollars created out of thin air and backed by nothing. And we have not even touched on credit default swaps and interest rate swaps, the losses from which could far exceed that $8 trillion figure. And let's not forget the half a trillion budget deficit, hundreds of billions in trade deficits which will get worse as the dollar strengthens and makes US good more expensive overseas, and the hundreds of billions that will be pumped in to support the phony "War on Terror" in Iraq and Afghanistan. Who we ask, will buy all the treasury paper that will be needed to fund this madness? Not many, so most of it will be monetized, which is immediately inflationary. Every move the Fed makes, especially the recent .5% reduction in its Funds rate, along with the upcoming eventual reduction of the Fed funds rate to 0%, is begging for hyperinflation/hyper-stagflation as we continue on our Bataan Death March in pursuit of Japan's ongoing nightmare journey into economic oblivion. You asked for it, you got it, Toyota.
Third, the PPT has driven oil down, both by direct intervention in the oil markets, but also via SEC strong-arming of specs by threatening to take away their profits from shorting and by forcing them to publicly disclose their short positions. This was a commodity wide ban on the specs under this threat, not just on precious metals trading. Note that a month ago today, the USDX stood at about 76 and oil topped out at $130. Now, we have a USDX of 85 and oil at $70. This means that the number of petrodollars being converted to euros, the preferred currency of OPEC nations, has been essentially cut in half, taking a huge amount of pressure off the dollar. This is known as the "euro effect." The euro was at $1.60 at one point, now it is at $1.28, and small wonder. This downturn in oil has lent tremendous support to the dollar, but it has devastated the Russians and the OPEC nations who also happen to be big gold buyers, which is hardly a coincidence. And, of course, weaker oil makes gold less attractive as a hedge against the high cost of energy.
Fourth, the overall commodity downturn, which has occurred through de-leveraging, liquidation and margin call pressure caused by de-leveraging, plunging stock markets, the unwinding of the carry trade and the chasing of large specs out of the paper commodity futures markets via SEC strong-arming and obnoxious PPT manipulation, is meant to hide the effects of inflation being caused by the bailouts, but such effects will soon be impossible to hide. The elitists are playing on the common misperception that falling price means inflation is being reduced, or is "moderating" as Buck-Busting Ben would put it. This is the excuse they need to keep pushing the Fed funds rate down until it hits 0% so they can continue their efforts to save the fraudsters and keep their precious sheople-bilking system afloat. But all that is really happening here is that money is being transferred from one place, the commodity markets, to other places, like treasuries (as a safe-haven for savings) and banks (via margin payments and debt de-leveraging).
If parked in treasuries, or hoarded in banks, the dollars from the commodity and stock market sell-offs are temporarily neutralized (some use the term "sterilized") just as happens when foreign central banks print and inflate their currencies to buy up their surplus dollar forex to purchase, and then park, those dollars in US treasuries, thus keeping their currencies artificially weak and reducing the cost of their exports. In this case, instead of exporting our inflation to other nations by selling our treasuries, which are now too numerous to pawn off on other countries, we are keeping that inflation here, but it is being kept under wraps as potential, as opposed to ongoing, inflation. But as our money supply increases with the multiple trillions in bailouts, and the trillions in money and credit which the Fed keeps pumping into the system via its now numerous facilities as M3 continues to rampage, all of which will manifest itself as hyperinflation in 6 months to 1 year from now, the pressure to bail out of treasuries will reach critical mass and the whole world is going to run for the exits at once. Then all those parked and hoarded dollars are going to come back to haunt us with a vengeance, and we will be completely, utterly and immediately Weimarized as everyone tries to grab as many tangible, real US assets as they can get their hands on. We will literally be awash in dollars, as if a dollar tsunami had just been unleashed by a Force 10 earthquake. We also expect to hear more threats from OPEC nations to break dollar pegs as the price of oil continues its downward spiral, and this could be the straw that breaks the camels back. If you don't own gold, silver and their related assets when this mega-tsunami hits, you will get wiped out completely by the hyperinflationary juggernaut.