The president’s economic stimulus plan is having its expected effect, if not its desired one:
(Gold) prices have been buoyed by increased demand from China. Each time prices tip, China appears to buy buying gold bullion, effectively putting a “floor” on prices. This action would appear to validate the long-held belief of many gold experts that China has fundamentally lost confidence in the US dollar, and is looking to boost gold reserves instead.
And there is also the spectre of inflation on the horizon. Mick Gilligan, the head of research at Killik said: “We are looking at years, not months but there are real fears inflation will be an issue again.” Governments have pumped billion into economies worldwide, in a bid to stave off global depression, creating potential inflationary pressure further down the line. Mr Gilligan adds: “Gold has always been seen as an insurance policy again inflation, as it tends to keep its value when dollars, pounds or euros are losing their buying power in real terms.”
In other news, the burgeoning market in carbon credits is trending in ways that probably weren’t predicted by its boosters. A credit that sold for $7 last year is now trading at 25¢. Zimbabwe’s currency is performing better.
Adam Smith nods. Tom “Thomas’” Friedman gnashes.
Hardly surprising. I said months ago that the CIA was very closely monitoring bullion buying by the chinese. Our currency has not only lost its value, but the faith behind it that artificially props up that value. So what happens to a $10 trillion debt when the dollar’s value falls another 70% against other world currencies? Can you say massive implosion? A family member travels to Zimbabwe every other month and they are on the dollar standard everywhere except offically. You can’t carry enough of the official currency to even ride the bus. Shades of wheelbarrows of deutsche marks.
Reichmarks. The DM was post WW2.
I stand corrected. A thousand gomen nasai’s.
De nada, since it’s Diversity Thursday over at ‘mander’s place and I’m in a diverse multi-lingual mood today
Don’t worry, we’re running as fast as we can to get under that metric….with our economic heft…
OT: Lex – You may be able to use this to get back some of those lost feelings…looks kinda cool, yet I lack time in the saddle of a go fast, #D ride to make a proper analysis.