Replies

"Any ideas of what type of economy comes out the other side?"

I am not optimistic that anything good will come out the other side. Folks mentioned in the previous response feel the same way. I and they believe this is "it" for the American financial system. The end.

The coming damand-collapse depression isn't the real problem. We had one of those back in the 30s. We survived it and eventually came out of it.

The real problem is rapidly developing on the monetary side. Trillions of fresh new printing-press dollars being added to the money supply are expanding our money supply at a truly frightening rate, never before seen in our history, at least not with the currency we have now.

That frightening growth of our money supply is occurring just in the past few months. Since September '08, with all these "bailouts". Since Sept our real money supply, what used to be reported as M3, but is no longer being reported, has essentially doubled in size, from roughly 7.5 trillion to 15+ trillion now.

Some people argue that much of that money isn't really in circulation since it is technically being held as bank reserves, but what WE think doesn't matter. It's what OTHER PEOPLE AROUND THE WORLD THINK that matters. They're stitting there with trillions of dollars worth of our bonds, mostly Treasury bonds, watching our real money supply grow at a frightening pace, and beginning to see the handwriting on the wall. The value of the dollar is going to start falling, and the value of those bonds along with it, not to mention the value of every other dollar-denominated asset in existence, including yours, ours, everyone's.

Bottom line, our rapidly expanding money supply is going to bring about the collapse of the dollar. I do mean collapse. I see it happening in two stages.

First, we're all going to wake up some morning and see the banks all closed. Before they open again, the dollar will be devalued by government decree. How much it will be devalued is anyone's guess.

That may happen a couple of times, or three times. Again, no one can say at this point.

Second, and the really BIG bust, will happen when all these people around the world see our government devaluing the dollar, and decide enough is enough. It's time to unload those trillions in rapidly depreciating bonds.

When that happens it will begin an enormous avalanche of selling all around the world. Everyone trying to dump dollar-denominated bonds at the same time.

That will cause the value of the dollar to absolutely crash, I mean drop right through the floor, and it will happen overnight as we here in America sleep in our beds.

I and the folks mentioned earlier, along with a growing number of other people, believe the crash of the dollar will be the final death blow to our economy and financial system. The end. There won't be a recovery from it.

There is growing talk about a new currency. The Amero. That is the only way I and many others can see that might keep things from collapsing permanently.

I've heard the exchange rate will be horrific. People will loose about 90% of value in the exchange.

It may nonetheless be the lesser of two evils. 90% loss of value would be better than complete collapse of our economy, financial system, and likely our nation.

So the 18% participation in the TBill auction last week, really was a noticable event.

Do TPTB really mean to destroy the US?

this is "it" for the American financial system.

So I take it that you would agree completely with those who shorted financials the minute that Larry Summers wrote his letter to Paulson last week!