Sunday, February 7, 2010

Ecomonic tight rope

Last year I theorized that the government couldn't find buyers for its T-Bills given the amount that they wanted to sell plus the low, low interest that they are offering.  Apparently the Federal Reserve is the biggest purchaser in a quantitative easing attempt.


I you will have to copy paste the address for now sorry I can't directly link

The Federal Reserve is buying the T-bills to cover the money that it is giving to the government. I think the plan is to gradually devalue the American dollar which has some merit. Having recently studied the economic revival in Argentina from having its crash peso I can see some similarities. Notably the USA is agriculturally self sufficent, and is capable of producing a number of its own practical and luxury items.

It goes of course it is a crash then it is game over for the civilized world. Great Depression II except without the soup kitchens. Huge numbers squatting in the the homes they once owed. Well bad.

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