Posted on 03/16/2011 5:59:34 AM PDT by quesney
That's worth repeating. Excellent point.
The question is, are there enough people who have awakened to the folly, to include overcoming the election fraud, to save the Republic?
>Could anyone name ONE instance of something positive out of this administration?
People, as a whole, are beginning to distrust the Government [as they should, IMO].
We are possibly getting to where we should have gone after Ruby Ridge & Waco: a near-reflexive distrust of any “official statement” made by the government.
Damn it! They're hiding the rise in prices by releasing one number including food and energy and then releasing the core index and telling us core excludes food and energy. Telling us in the same sentence. The fiends!
Should be called the "fools safety."
Remember that quote about those who sacrifice liberty for safety get neither and deserve neither.
I felt like I was the only one in the country hopping up and down on one foot about that piece of legislative subversion. Glad at least one other FReeper noticed it.
What food pansies we've become.
I wonder what free passes Tyson food gets? And McDonalds.
I wonder if ma and pa selling roadside veggies get a swat team visit.
Do we get an army of Ag Police, too? Bonus!
“The upward prices were inevitable when a large number of vegetables left the food market and joined the democratic party to be with like minded beings.”
Post of the day! Ding,ding,ding, we have a Winner!
Just wait until the gas prices used to transport that food impacts the price. It has already but it'll rise more throughout the summer. Then there will be some natural disaster to bring prices up even more - Mexico just had bad weather, Japan with it's current situation, and I can guarantee you that Fredricksburg will whine about the annual April cold snap that will ruin the peach crop again just like they do every single year. Then there's those who raise their prices simply because everyone else is. It's a never ending cycle.
It’s posts like yours that prove that Free Republic needs a “Like” button.
I think that the chance of selling off their dollar-denominated foreign reserves is maybe about 10%, just to pick a round number. It's maybe about a 20%-30% chance that they will keep the foreign reserve level about the same.
Instead, I think it's about 60%-70% likely that they will increase their foreign reserves. Why? Because it lowers the value of the yen, which will help their exports (if that mechanism is not obvious, remember, in order for them to buy dollars, they sell yen, which pushes the price of the yen down.)
Right now, the yen is in record high territory against the dollar (and, note, that means that their dollar-denominated foreign reserves are worth less).
My guess is that it would help the Japanese economy a lot more to get the export machine fired up rather than just selling off their vast foreign reserves at rock-bottom prices --- and which would also push up the value of the yen.
(And, yes, for the zaiteku set out there, it is possible to mitigate moving the yen-dollar rate, but at the size of these moves, it would take the Fed's cooperation.)
I agree with you.
Devaluation is a reduction in the value of a currency with respect to those goods, services or other monetary units with which that currency can be exchanged.
In common modern usage, it specifically implies an official lowering of the value of a country's currency within a fixed exchange rate system, by which the monetary authority formally sets a new fixed rate with respect to a foreign reference currency. In contrast, depreciation is used for the unofficial decrease in the exchange rate in a floating exchange rate system. The opposite of devaluation is called revaluation.
Depreciation and devaluation are sometimes incorrectly used interchangeably, but they always refer to values in terms of other currencies. Inflation, on the other hand, refers to the value of the currency in goods and services (related to its purchasing power).
The question is, are there enough people who have awakened to the folly, to include overcoming the election fraud, to save the Republic?””
Keep in mind 48% of adults paid no federal income tax, 43 million on food stamps, etc. The libs/progs/parasites will not convert. We need laws to prevent people who draw a govt check from voting for more govt checks. This means, they would be denied the right to vote if they fall into this category. It is a conflict of interest.
” Why? Because it lowers the value of the yen, which will help their exports “
A ‘cheaper’ yen means lower prices for their exports, sure - but there’s another side to that equation, since Japan IMPORTS virtually all of its raw materials, which means that they will be correspondingly more expensive....
At some point, that congruency squeezes margins so that there is no excess capital left available for rebuilding....
(Or, more likely, I’m not conversant with the nuances, here...)
Reeg, prepare for your family. It is going to get much worse and here is why:
Who will buy this debt?? June 30, 2011. Summer has begun. The kids are off from school. Lazy days at the beach. Barbecue in the backyard. The end of America as we know it. Allow me to explain. You have heard me rant about the policy of the Federal Reserve buying treasuries as part of “Quantitative Easing II” in its attempt to get the economy going through the wholesale creation of fiat money, money out of thin air. The Fed now purchases seventy percent, seventy percent! of our treasuries, the instruments of our debt. When we talk about our 1.5 trillion dollar deficit that we expect to run next year...again, we are really talking about people buying our treasury bonds, loaning us money, to finance our government’s exorbitant spending. We have put ourselves in the ridiculous position of borrowing 40% of the money we spend and the Republicans are talking about cutting what, $100 billion dollars at most? So we will borrow what, only 39%?!
In the not too distant past, foreigners and domestic investors purchased all the treasuries necessary to cover deficits in the ridiculous amounts of $200 billion or so. Now, all those investors, foreign and domestic, only account for thirty percent of treasury purchases. That means the Fed is expected to buy over $1 trillion dollars of debt over the course of a year to keep things running. That policy is supposed to end on June 30. Who is going to take up the slack? Who is going to buy an additional one trillion dollars of our debt every year? The answer is no one. No one, no country, has that kind of money. Warren Buffet and Bill Gates couldn’t cover the interest on our debt for more than a few months if government took everything they owned. Even if someone could, who is going to? Why invest in a ‘corporation’ that is run so irresponsibly and is accumulating debt at such a pace?
If no one buys we are talking about the real possibility of default. The debt ceiling means nothing if no one will lend you money. Basic federal obligation are not going to be met. The dollar will lose its status as the reserve currency and we will begin the long slide into the nightmare of hyperinflation. Two things will put this off temporarily. One, the Fed keeps buying. This may give us a few more months but what happens when the Fed’s portion of purchases is 90% or even 100%? Will the dollar mean anything to the world then? Or the interest offered by the treasury will rise to the point where people are willing to invest. This will make credit very expensive, giving a sucker punch to an already teetering economy. Our interest payments will soon crowd out every other federal expenditure and we will end up defaulting. There just isn’t enough money.
Is this inevitable? Let me ask you this. Do you think that there is enough political courage among the politicians in Washington to eliminate the deficit this year, only spend $2.2 trillion instead of $3.7 trillion, and then tackle the problem of entitlements? I don’t think so either. So how will you live over the next three to six months? Will you prepare? Will you tell your friends to prepare? Will you educate them, tell them the cause of the problem is what we have allowed our government to become? Will we muster the courage to endure and recreate America as the land of the free and home of the brave?
See how it all works out? Obama doesn't want you to use energy, because, well, just because, Obama doesn't want you to eat, because you're too fat, and you shouldn't be going anywhere anyway, unless it's on a train or bus.
” We need laws to prevent people who draw a govt check from voting for more govt checks “
So, you would relegate to the status of “useless eaters”, and disenfranchise, those who have been disabled in service to our Country, and those who have devoted a working career to service to our country, as well as those who have diligently worked and paid taxes (and FICA *contributions*) for their entire working lives....
How do you feel about “death panels”???
Re: prepare your family / getting worse before better
Agreed. Zero now has so many ways to crater the country and declare martial law that he’s celebrating in Rio ...
Zero options:
1) Timmy boy comes out and announced devaluation
2) Timmy keeps up with his “U.S. now supports new reserve currency”
3) Uncle Ben halts QE2 in June
4) Uncle Ben starts QE3 and there are no buyers; EU and China win
5) Arab oil constraint ... what is Zero doing behind the scenes in the Mid East anyway? He’s a busy bee ... can’t be up to any good!
more options ... I’ll leave it to others to add to the list.
As you say, time to get ready, get aligned with The Lord and think of your family.
You are correct that import prices do go up as the yen becomes cheaper. However, in general, Japan makes more money with a cheaper yen than an expensive one. The Bank of Japan has sold a lot of yen over the last 10 years trying to keep the yen cheap against the dollar.
Also, there are ways to mitigate import prices.
The most economical perhaps to own the foreign means of production rather than pay the local market cost for a product; for example, Mitsubishi has mineral resource production around the world. The formula is simple: pay for production and whatever royalty/tax the local government requires instead of paying market prices which get hit directly by the current yen rate.
Japan, for another instance, has enormous oil production despite having virtually no oil reserves.
Instead of paying the world market price for oil, Nippon Oil produces it in foreign markets, pays whatever the local royalty is (usually well below the market price), and refines it in Japan.
This isn't a perfect scheme, of course, since raw resource production is always somewhat chancy; leases can turn out to be dry holes, or the local government increases its demands for royalties or bribes, or production is disrupted by war or natural disaster, or any of a host of other tribulations.
But it also matches the Japanese cultural desire for high quality materials; generally, a Japanese company is happier working with another Japanese company than a foreign one (who knows what kind of dicey product they might be foisting off on you? ;-)
It also has to do to crop damage.
Uncle, I am referring to the able-bodied parasites and progs. These people are voting the country into bankruptcy and BO is their boy.
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