Is Obama making a move that will make our salaries and savings more in line with those in China, Vietnam, Brazil, and Mexico?
On the day after the mid-term elections, the Obama administration is making a move that may well result in widespread inflation. Obama is intentionally devaluing the US dollar making the cash in your pocket, your bank account, your retirement plan, worth less.
(T)he Fed now will print money to buy as much as $900 billion in U.S. government bonds through June—an amount roughly equal to the government's total projected borrowing needs over that period.
In short, the United States is printing money to buy its own debt. When the government prints more money, the cash you have in your pocket, your savings in the bank, and investments in your retirement account are
worth less.
In effect, you will have less money if this plan works.(I)t can be seen that by printing money say by twofold this will lead to a doubling of prices.
And
doubling the amount of US dollars in circulation is exactly what Obama plans to do. You do the math as to how a doubling of consumer prices will affect you.
Many outside the Fed, and some inside, see the move as a 'Hail Mary' pass by Fed Chairman Ben Bernanke.
Why are they doing this?
(T)he Fed said it was acting to "promote a stronger pace of economic recovery" and to ensure that inflation, now running at around a 1% annual rate, moves toward the Fed's informal objective of 2%.
If the plan works,
it may act to reduce unemployment by "(driving) down interest rates and (encouraging) more borrowing and growth, an effect exemplified by the
Phillips Curve.
However, if it doesn't work, or doesn't work well enough, we will go through a period of inflation. When that happens,
the dollar becomes worth less.
The dollar is in danger of losing 20 percent of its value over the next few years if the Federal Reserve continues unconventional monetary easing, Bill Gross, the manager of the world's largest mutual fund, said on Monday.
Which means, if you have a dollar in your pocket, it will actually be worth only 80 cents.
Prices rise across the board, but your salary and savings do not necessarily follow.
In economics, inflation is a rise in the general level of prices of goods and services in an economy over a period of time. When the general price level rises, each unit of currency buys fewer goods and services; consequently, inflation is also an erosion in the purchasing power of money – a loss of real value.
As inflation increases, everything will cost more. Think about this when you go to the super market -- the prices of everything in your cart will cost you more, maybe much more, in the very near future. And it is being done intentionally.
Its been
said of
practically every major Obama policy, we have no idea if
it will work, or
how well.
Many outside the Fed, and some inside, see the move as a 'Hail Mary' pass by Fed Chairman Ben Bernanke.
And all football fans know how poorly the
Hail Mary pass succeeds.
“It’s a desperate act,” says Jeremy Grantham, co-founder of the investment firm GMO. Grantham says it’s a clear message from the Fed to the rest of the world: “The U.S. doesn’t care if the dollar weakens.”
If it does work, we may go into a period of
intentionally depressed salaries.
"To the extent that Chinese labor, Vietnamese labor, Brazilian labor, Mexican labor, wherever it is coming from that labor is outcompeting us and holding down our economy," Gross said. "One of the ways to get even, so to speak, or to get the balance, is to debase your currency faster than anybody else can."
Is Obama making a move that will make our labor costs more competitive with China, Vietnam, Brazil, and Mexico. Just what I want, to get paid in line with Mexican workers, don't you?
According to New Hampshire congressman Judd Gregg, one-time Secretary of Commerce appointee under Obama, talked of
one consequence of continuing the Bush/Obama fiscal insanity:
"This nation is on a course where if we don’t do something about it, get federal situation, the fiscal policy [under control], we’re Greece. We’re a banana republic," said Gregg.
Now, I am no economics major, so I don't know exactly what this all means; but, it doesn't take a master chef to know that the meal in front of you doesn't smell right.
Besides, if this maneuver by Obama were such a good thing, then
why did the administration wait until after the elections to announce the plan?
FLOTUS Michelle Obama is planning to launch a campaign to put salad bars in schools.
How bizarre must that be? Sorry, Timmy; your salad looks lovely, but you need four tomatoes and I only see three. Too much dressing; remove that extra grated cheeses. And you have only 1... 2... 3... 4... 5... five leaves of lettuce. Come on. You got the memo. You need at least eight. I don't care if you don't like romaine! Think of the USDA!Concerns have been raised that elementary school children in particular might be prone to spread disease at salad bars because they are too short for the standard "sneeze guard" installed on most salad bars, or because they might use their hands instead of the serving utensils provided.
