By Monty Pelerin, on January 5th, 2010 “My long view for the US is high inflation which will not show up in the government’s fraudulent statistics, along with a declining standard of living, increasing decay and ultimately leading to chaos, societal and government collapse in the US within a decade or two, maybe sooner.” Craig Harris
The following article will seem extreme to some. The above quote especially will shock many. My view is that this quote is a reasonable estimate of where we are heading. No one can predict the future with precise accuracy. Even if a prediction is correct, estimating the timing is even tougher.
Many, including myself, will argue that the future is not deterministic. Actions and policies can change and alter outcomes. Clearly, that is true. Yet, it is likely that the tipping point for changing policies necessary to avoid Harris’ prediction was past years ago. In that sense, his forecast may be deterministic, i.e., independent of any actions that are subsequently taken.
Future actions can certainly influence the timing, but I believe Harris has covered that possibility with his “within a decade or two, maybe sooner.” My personal guess would be within a decade.
BANKRUPT FASCIST OLIGARCHY WITH A MILITARY MACHINE
Dec 27, 2009
Craig Harris
For a contact email address go to Craig’s website:
http://earthblognews.blogspot.com/
“I would buy every three months some gold and not worry so much about the price because the weight stays
Continue reading Free Markets Don’t End Like This
By Monty Pelerin, on December 3rd, 2009 The Fed has reached the point where there are two choices — Allow the government to shut down or allow itself to be the Treasury’s ATM machine.
Inflation is, as Milton Friedman was fond of saying, “always and everywhere a monetary phenomenon.” It is insidious. It becomes a part of everyday life, sometimes overlooked. It is cumulative and devastating. The US dollar has lost 96% of its purchasing power since the formation of the Federal Reserve in 1913. Most of that loss occurred from the late 1970s. The US abandoned Gold as backing for its currency in 1971, which left the entire world on fiat currency, unbacked by anything but government promises.
The American worker was clobbered during the past 30 plus years, whether he realized it or not. Today’s real weekly wage is below that of 1966. It has been so since 1977. During the late 1970s and early 1980s inflation was more than insidious, it was blatant. Mortgage rates, the prime rate and inflation rates rose well up into double digits. Inflation then was not some mild background music to life. It was a cacophony. As Reagan described it: “Inflation is as violent as a mugger, as frightening as an armed robber and as deadly as a hit man.”
We are likely now on the eve of an inflation that will make the Carter-Reagan era appear mild. The political class and their actions assure that.
This chart shows rather dramatically what has happened to the
Continue reading The Fed Is Nothing But An ATM Machine
By Monty Pelerin, on November 22nd, 2009 Doug Noland at Prudentbear.com has another excellent article in which he argues persuasively that the focus of the government’s effort is wrong and will do additional damage:
“The focus remains on financing the old structure. Indeed, I would argue that the current course of policymaking and market interventions only work to delay the unavoidable economic adjustment process.”
It is difficult to disagree with his perspective which follows.
Reflation Issues Heat Up:
The Bernanke Fed held tightly to its “extended period” language in their November 4th communication. Global markets took this as a signal that the Fed would not be shifting away from its ultra-loose stance until sometime later in 2010 – at the earliest. Then there were captivating comments this week from St. Louis Federal Reserve Bank President James Bullard: “Policy rates are near zero in the U.S. and the rest of G-7 countries, something not seen in postwar economic history. The FOMC did not begin policy rate increases until 2-1/2-3 years after the end of each of the past two recessions.” Markets were quick to ponder the possibility that rates might be on hold all the way into 2012. The Fed should discourage such thinking.
Share/Save
By Monty Pelerin, on November 9th, 2009
Image via Wikipedia
What’s old is new again, or soon to be. Unfortunately, we will probably have to incur an economic collapse before the modern-witch doctors we call economists are finally disgraced. For a variety of reasons, more and more people are questioning the so-called wizards.
Rolfe Winkler states: “If mainstream economists had the intellectual honesty to admit that their theories don’t properly account for debt, if they gave “fringe” thinkers like Minsky and Mises a fair hearing, we might discover the “new” economics that has been under our noses for a hundred years.”
November 9th, 2009
For “new economics,” look to old economists
Posted by: Rolfe Winkler
Tags: rolfe winkler, LM Holt, minsky, Mises
When it comes to managing the business cycle, Keynesian and laissez faire economics have failed rather spectacularly, their prescriptions leading to increasingly violent bubbles and busts. For this reason there have been calls for a “new economics.” To get there, perhaps we just need to rediscover forgotten economists like Hyman Minsky and “New” Economics is “Bad” Economics
By Monty Pelerin, on November 4th, 2009
Image via Wikipedia
Image via Wikipedia
Below is today’s press release from the Fed. I have emboldened a couple of key statements.
“With substantial resource slack likely to continue to dampen cost pressures and with longer-term inflation expectations stable, the Committee expects that inflation will remain subdued for some time.” While this statement may be true (probably less so than we are led to believe) at the moment, ignore it. It is a “CYA” statement that provides cover for the Fed to continue pumping the economy. This statement or its equivalent will probably be in the Fed’s statement until a month or two before rampant inflation is obvious to everyone.
“The amount of agency debt purchases, while somewhat less than the previously announced maximum of $200 billion, is consistent with the recent path of purchases and reflects the limited availability of agency debt. In order to promote a smooth transition in markets, the Committee will gradually slow the pace of its purchases of both agency debt and agency mortgage-backed securities and anticipates that these transactions will be executed by the end of the first quarter of 2010.” This statement is inconsistent with the prior statement. It is either untrue or a diversion. There is no “smooth transition in markets” possible. While it might be possible that the Fed does actually honor this statement in a strict sense, they will merely shift their pumping to a different vehicle. To stop
Continue reading The Great Oz er Fed Has Spoken – Go To The Bunker
|
Friedrich von Hayek
Friedrich von Hayek founded the Mont Pelerin Society.
“Monty Pelerin” is a pseudonym chosen by this blogger to convey general agreement with the philosophy, goals and spirit of the Mont Pelerin Society. No other connection exists between the blogger and the Society.
|
