The Rev

The graph below shows the monetary base, or M0 money supply. This is all the currency and all the bank reserves in the country. This is, in a nutshell, the money that comes off the presses at the Fed. Since September, it has more than doubled.

Fortunately, this money is being largely held in reserves by banks who are unwilling to lend, due to the current economic situation. However, when the economy turns, and the banks that are being pounded on daily by the government and everyone else to "Lend! Lend!" actually DO start lending, this huge surplus of reserves will balloon.

With the new M0 at nearly two trillion dollars, and a reserve requirement of 10% only, this money could expand to up to TWENTY trillion in circulation. This would give us an inflation rate of nearly 2000% by the time all the money works it's way fully into the economy. Now, since the M1 (or the money supply that includes demand deposits, and therefore, represents the money supply after it is inflated) generally runs around two times (not ten times) the M0, 400% inflation of the currency is a more likely scenario.

Either way, be prepared for everything to shoot up in price by 4 to 5 times within the next year or so.



The Rev

Attached Images

 

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The Rev

Personally, I'm completely stunned by this total lack of fiscal responsibility on the part of our government (this whole thing started with Bush, and Obama's administration is just accelerating it). I mean, the lessons learned from the history of inflation and hyper-inflation are quite clear. What will happen as a result of this out of control new money creation should be no mystery to Bernanke or Obama or any of them.

So how could they be so fucking stupid?

I have always been reluctant to believe the Trilateral Commission type conspiracies, but I can come to no other conclusion than to believe this is a deliberate attempt to destroy the currency. My only question is, "Why?"



The Rev

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DubStyle311

Its far more complex an issue than you've presented, or could even imagine for that matter. Just let us handle it.

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I may be wrong, but I doubt it.

SmokeSomeDoja

you should leave it to people that dont live in a fantasy world full of abstract and dumb notions that have little to no relevance to society.

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fotoz fo yo azz



"I've run over black cats that were luckier than me."

SpankyMcLankey

Fo sho^

It's sick how they hold marijuana smokers more criminally responsible for where we are today than any one. They hold hippies more criminally responsible than any single one of those irresponsible greedy credit launderers. Why? I just don't understand, what's actually more important to the government. Themselves or the people they are supposed to be looking out for.

To be honest, I just think it's way too complex. There's too many people to keep track of, it's impossible to have a well balance economy with this many people in the world. Their priorities are completely fucked, I just don't know what's right and wrong anymore. There's so many greedy crooks out there that need to go to jail for taking poeples money and sitting on it.

420smokeman

its gonna get more complex, and weird and everyones gonna go insane! and we will be left with only one option. start a new economy based in reality and the laws of the universe, uncondition love and peace for all, and relize who we are

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cause there aint nothing else to do and any where i go i know im you and i keep coming back forward through to myself

Dozer McDozer

and people will smoke weed together.

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Condemnation without investigation is the height of ignorance. - Albert Einstein

Properly trained, man can be a dog's best friend - i'll get his name once i get book back

Ego Tripping

Too much fear. Surprisingly, I'm actually more in-line with Dubstyle's comment.

Get a grip, guys.

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Ego Tripping

What ever happened to taking things day by day? What kind of stoners are you?

Seriously, what's the worst case scenario?

Money bottoms out, people can't purchase items with greenbacks anymore. Essentials for life will have to be found locally and through bartering means. People go back to living simple, community based lives. Those that are in concentrated big cities will most likely suffer and die through urban riots and fights (sorry if you live in a big city but hey, don't pretend like you didn't see it coming).

But when the dust settles, which of course it will, a new currency and form of economy will rise from the ashes that is based more on community levels and less centralized throughout the world and we'll all be better off after having to lived through the experience that will be blogged, wiki'd and twittered down to the last day. Out of it will emerge a sense of human nature that is less materialistic, more grounded, less selfish, more caring.

And then, the world will keep turning and we'll all thank whatever god we're praying to at the moment that it did happen, rather than have the corruption continue just to save ourselves from an inevitable outcome (ignorance of our resources).

So once again...get a grip and relax. Nobody knows exactly what is happening but that doesn't mean there aren't many, many solutions to our problems.

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SpankyMcLankey

Yes of course, what ever happens is a good thing. I predict if humans will be around in another 2000 years, there will be 1/10 as many humans as there are now. Humans are more efficient than this.

I just don't understand why the government is trying to add on/change and maintain laws made 200 years ago. shit's not the same anymore.

The Rev

Or a period of hyperinflation will be used as a political opportunity to deprive us of more of our rights and usher in a fascist state (worked for Germany).

Seriously, we've seen some fucked up shit in this country over the last eight years, in terms of infringement on our rights and expansion of government power. I think this issue deserves a little more than a dismissive, "Chill, dude."



The Rev

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Ego Tripping

Ok then, I'll bite.

Tell me what you plan to do.

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Kompressor

It's ok Rev, China's got our back.

They got no choice.

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Think like a man of action, act like a man of thought. -H. Bergson

SpankyMcLankey

why no?

The Rev

I was hoping just to discuss it, at this point. Get some actual input, and maybe a few ideas from you guys that hadn't occurred to me.

Buying gold or some other commodity is a good hedge against inflation, and I am considering converting my savings to gold for this reason. Aside from that, I'm not sure what to do. I'm reading alot about economic theory and trying to learn a little more about how things work in the world. Trying to become more financially and economically literate.

In fact, I think the reason the government can get away with doing such destructive things, then later blaming them on the market, is due to such widespread ignorance of money dynamics in our culture.



The Rev

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The Rev

Actually, if we blow our currency up, they could refuse to roll over their Treasuries, demanding that we print yet more money to pay them, accelerating the inflation. This is what happened in Germany in 1923, when germany printed vast amounts of money to pay war reparations. As the exchange rate sought to keep up with the inflation, they printed yet more, devaluing their currency to joke proportions, much like Zimbabwe today.



The Rev

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Ego Tripping

First question: what are you trying to do? Survive or thrive?

If it's survival and protection of your family, where & what kind of environment do you live in?

If it's not just survival and more about thriving in the next stage of our economy, what skills do you have that you can offer your community? Instead of trading everything in for gold, have you considered trades and barters?

Edit - Think about the tremendous opportunity that is at our feet. We have a world's history to reflect and learn from and a global technology that is allowing us to discuss and rationalize it. Isn't the point of all this, to evolve and not repeat history? I feel just our mere discussion of this right now is assuring us that it's not a repeat...as long as we take action on what we know to be true.

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SpankyMcLankey

why would you barter off your whole lifes savings?

are you okay ego tripping?

Ego Tripping

Well, first off, I didn't say barter it all

Secondly, there's not just one answer to problems facing us. This is just a facet of what it means to live in society that is forming before us. Money is just a small percentage of what it means to live your life and I feel this is the biggest thing we've yet to accept and embrace...because it's not a bad thing at all, unless you just care about money a whole lot.

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LetsPlayYourWay

You? The same vile, looking down on the rest of society financial scum? Nah, no thanks.

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