TOP 10 Q & A's

Q8. You talk a lot about inflation and deflation being the two most important considerations for investors. Which way do you think the economy will tip? Will we get a serious deflationary depression as we did in the 1930s or a hyperinflationary depression as Germany did before Hitler came to power?

 

It could go either way, but one thing I am sure of is that those who rule our system—namely, the shareholders of the Federal Reserve Bank who own not only our central bank but also our politicians—will exercise policies that they perceive to be in their best interest. At this point in time, the Fed is doing exactly what it was designed to do, which is to bail out banks at the expense of taxpayers while allowing bankers to retain huge windfall profits they have stolen, made possible solely by the use of paper money rather than gold. At the present time (May 2009) it looks to me as if the ruling elite are allowing the system to engage in deflation while taxpayers are bailing the banks out and thus enabling America’s wealthiest people to continue taking fat bonuses. I am guessing that once most of the remaining wealth is drained from our system and the middle class is largely extinct, and when/if there are riots in the streets because of increasing poverty levels, policymakers may well begin to print “helicopter money” and shower it over the masses. At that point in time we could well see America’s economy evolve into a massive hyperinflationary environment.

 

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