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View Full Version : Fed say it will have to monetize more debt



Katwoman
8th April 2009, 16:44
The Fed said it would spend up to $300 billion to buy long-term government bonds and would buy an additional $750 billion in Fannie and Freddie securities.

http://news.yahoo.com/s/ap/20090408/ap_on_bi_ge/fed_minutes

other1z
8th April 2009, 17:52
None of this surprises me at all. They haven't gotten it right, yet, so why would we think their first round of printing would be the last? Insanity.

duneyman
8th April 2009, 18:25
The Fed said it would spend up to $300 billion to buy long-term government bonds and would buy an additional $750 billion in Fannie and Freddie securities.

http://news.yahoo.com/s/ap/20090408/ap_on_bi_ge/fed_minutes


Ho hum. Who cares if the Fed monetizes debt ? Will that cause the price of gold to rise ? Probably, but it may not do much for silver.

akak
9th April 2009, 17:30
Ho hum. Who cares if the Fed monetizes debt ? Will that cause the price of gold to rise ? Probably, but it may not do much for silver.


No, it may not do much for silver.
And an asteroid may land on your head tomorrow.
And pigs made start being born with wings.
And angels might fly out of my ass.

All those things MAY happen, but I suspect not.

What is Truth?
9th April 2009, 17:55
Ho hum. Who cares if the Fed monetizes debt ? Will that cause the price of gold to rise ? Probably, but it may not do much for silver.


So you are now willing to admit that the dollar is in trouble?

cowboycarl04
9th April 2009, 17:55
The past two responses from Duneyman have now made me ignore him completely. I have no respect for a piece of trash like this.

1) This "well in 1987 the average rate of return" shows he is either the dumbest person alive or is posting to antagonize but no one in their right mind would make such an ignorant comparison. You might as well have gone back to 1512 and shown how prices in silver (relative to US dollars) have gone down around 99%.

2) This "so who cares if they print money out of thin air" comment tipped me over the edge.

If you are doing it to piss people off and to laugh, well I hope this gets you off, for it's the last time.

I went from respecting this blogger for offering a different view to only having respect for his waste because at least his #1 and #2 are smart enough to leave his body.

What is Truth?
9th April 2009, 18:00
The past two responses from Duneyman have now made me ignore him completely. I have no respect for a piece of trash like this.

1) This "well in 1987 the average rate of return" shows he is either the dumbest person alive or is posting to antagonize but no one in their right mind would make such an ignorant comparison. You might as well have gone back to 1512 and shown how prices in silver (relative to US dollars) have gone down around 99%.

2) This "so who cares if they print money out of thin air" comment tipped me over the edge.

If you are doing it to piss people off and to laugh, well I hope this gets you off, for it's the last time.

I went from respecting this blogger for offering a different view to only having respect for his waste because at least his #1 and #2 are smart enough to leave his body.

I got to agree. The D-man has jumped the shark with his posts. They use to offer a counter point to what is the common opinion about silver around here. But now he has moved into being just bitter towards silver for what ever reason and offer little logical argument. What a disapointment D-man!

silverbuyer
9th April 2009, 18:18
Costa Rica is starting to look pretty good.

duneyman
9th April 2009, 18:19
So you are now willing to admit that the dollar is in trouble?


I never said America and the dollar didn't have many problems. My main point was that other countries also have difficulties. Maybe the dollar index will go down but then again maybe it won't.

duneyman
9th April 2009, 18:20
I got to agree. The D-man has jumped the shark with his posts. They use to offer a counter point to what is the common opinion about silver around here. But now he has moved into being just bitter towards silver for what ever reason and offer little logical argument. What a disapointment D-man!


If everyone else prints money it may cancel each other out.

silverbuyer
9th April 2009, 18:23
The Fear factor drives the price of silver and gold. When people are at max fear sell. When they feel content and at ease and trouble looms (as in this period) buy enough to protect some extra currency. Diversify is all you can do right now. People holding PM's only are making a big mistake. All you have is appreciation possibly. No tax benefits, no leverage, or subsequent debt paydown, no income. If you really believe we will have consumer hyperinflation or even high inflation you should borrow as much money as possible through buying income property and houses and pay off the debt with worthless dollars.

Katwoman
9th April 2009, 18:33
I own an investment property and silver. The rest of my money was invested in my education. Money I am willing to lose I use to play the stock market as I consider this to be the same as gambling.

What is Truth?
9th April 2009, 18:57
I never said America and the dollar didn't have many problems. My main point was that other countries also have difficulties. Maybe the dollar index will go down but then again maybe it won't.

Really? http://forums.silverseek.com/showthread.php?t=6426

cugir321
9th April 2009, 19:11
It won't cancel out debt to the American taxpayer. In real inflation and interest owed.


If everyone else prints money it may cancel each other out.

duneyman
9th April 2009, 19:17
Really? http://forums.silverseek.com/showthread.php?t=6426


You get my point. The Fed monetizes debt and the dollar index doesn't even go down since everybody else out there has big problems too.

mark2112gum
9th April 2009, 19:35
You get my point. The Fed monetizes debt and the dollar index doesn't even go down since everybody else out there has big problems too.
Yet the Fed is printing more cash than the GDP of many countries combined, and still, the US dollar is strong. My point being that if another country, lets say Canada did this, there dollar would be worth 'next to nothing'.

If the US dollar stops being excepted as a world trade dollar (Russia and China are talking about this), then the US dollar would be worth less than half of what it is today.

SeekrBrnEvryMin
9th April 2009, 22:50
Each country will do what's to their advantage. Some hold more gold that others, some have been importing more, some still have the capacity to export, and some, like the US, are working from the standpoint of a disadvantage (to say the least).

In a very short time, we've gone from being a creditor nation to debtor nation, we don't export much because we farmed out our capacity to produce, and we're sucking hind tit in terms of fiscal stewardship.

Relatively speaking.

If everyone were to dilute their currency equally, we'd still be in the same relative position compared to every other nation.

But they won't dilute it equally. Not even under a new world currency.

Because our position going in is one of relative weakness.

We stronger that others, but we always were. But we're much weaker that we were fifteen years ago compared to others.

And that makes all the difference.

akak
10th April 2009, 01:11
You get my point. The Fed monetizes debt and the dollar index doesn't even go down since everybody else out there has big problems too.


Well, dipshit, you conveniently ignore the fact that the dollar index only measures the value of the dollar RELATIVE to other fiat currencies which are ALSO falling in value. The dollar index does NOT measure the absolute value of the dollar, which is, has, and always will be FALLING!

Get it yet, asshole? RELATIVE value does not equal ABSOLUTE value!

SeekrBrnEvryMin
10th April 2009, 01:17
Akak, the value of everything is relative.[I]

Perhaps you should point out the error of his relative [I]measure.

akak
10th April 2009, 01:24
Akak, the value of everything is relative.[I]

Perhaps you should point out the error of his relative [I]measure.


Now that's a nuanced mind! Or at least a sharp one! Yes, you are correct, SBEM, what I should have said was "measure" and not "value", although in colloquial speech the two are latter is often used to mean the former.

Nevertheless, all the pro-status-quo shills who ridiculously try to talk about the "strong dollar" are only being disingenuous by using the dollar index to measure the strength of the dollar, when they should be using the CPI, the price of gold, or anything else that measures its absolute purchasing power, which has NEVER risen and never will. The very idea of a fiat currency RISING in value is absurd!

hiyosilver
10th April 2009, 01:41
at least his #1 and #2 are smart enough to leave his body.


and he still wears pull-ups....which he doesn't change as often as he should....

SeekrBrnEvryMin
10th April 2009, 01:41
I still cannot get over the fact that silver is 12 bucks an ounce. 12 bucks. That's it. I remember getting My Weekly Reader in 5th grade and thinking how futuristic 1977 seemed.

For relativity on silver's value, just take a new penny and break in in two.

This is 2009. You'd think it'd be $65 - $85 an ounce.

theo68
10th April 2009, 02:33
The Fear factor drives the price of silver and gold. When people are at max fear sell. When they feel content and at ease and trouble looms (as in this period) buy enough to protect some extra currency. Diversify is all you can do right now. People holding PM's only are making a big mistake. All you have is appreciation possibly. No tax benefits, no leverage, or subsequent debt paydown, no income. If you really believe we will have consumer hyperinflation or even high inflation you should borrow as much money as possible through buying income property and houses and pay off the debt with worthless dollars.

Unless you have a good idea of when hyperinflation will hit, taking on more debt is a risky proposition. Right now we still have deflation and if you take on more debt and lose your source of income, you could easily wind up in bankruptcy long before the dollar starts to devalue.

Secondly, lets assume that you do make it to hyper-inflation. Expecting the banks to meekly accept your worthless dollars as payment is a little naive. If the dollar collapses the bankers would likely push for the option to force payment in hard assets or some other replacement currency. You could file suit for breach of contract, but I doubt there will much of a court system running at this point. During a currency crisis there will be a mad scramble for hard assets to the extent that being in debt could mean losing your property. They may let you continue to live there, but it would be as a renter not an owner.

When the dollar starts losing value in large chunks we should plan to start paying down or possibly pay off any secured loans (meaning your mortgage and your car loan) with any cash that can be spared; even if it means selling some of our PMs to accomplish this. The window of opportunity to do this may be as little as two weeks. As my wife pointed out a few weeks ago, "If we lose the house, nothing else matters."

Katwoman
10th April 2009, 08:06
Unless you have a good idea of when hyperinflation will hit, taking on more debt is a risky proposition. Right now we still have deflation and if you take on more debt and lose your source of income, you could easily wind up in bankruptcy long before the dollar starts to devalue.

Secondly, lets assume that you do make it to hyper-inflation. Expecting the banks to meekly accept your worthless dollars as payment is a little naive. If the dollar collapses the bankers would likely push for the option to force payment in hard assets or some other replacement currency. You could file suit for breach of contract, but I doubt there will much of a court system running at this point. During a currency crisis there will be a mad scramble for hard assets to the extent that being in debt could mean losing your property. They may let you continue to live there, but it would be as a renter not an owner.

When the dollar starts losing value in large chunks we should plan to start paying down or possibly pay off any secured loans (meaning your mortgage and your car loan) with any cash that can be spared; even if it means selling some of our PMs to accomplish this. The window of opportunity to do this may be as little as two weeks. As my wife pointed out a few weeks ago, "If we lose the house, nothing else matters."

Actually if things get that bad with so many people defaulting the banks themselves fail and possession being 9/10 of the law they will turn te house over to you since having all those houses to manage would be impossible for them to do. I have spoken to people from Argentina and what happens is this: 1)old debt remains the same; 2) the cost of everything else goes through the roof; 3) since a loaf of bread costs $10 it becomes harder to afford necessities and luxury items are virtually never purchased. People in small towns start to barter and PMs become a form of currency since the value will decrease with more inflation.

Maple Silver Syrup
10th April 2009, 08:24
wouldn't it be better to take on more debt? Why pay down before the value of the dollar decreases? I would rather take on debt while the dollar has value and reinvest it to a dividend or pms while u can?

cabtrom
10th April 2009, 09:24
confusion says: If everyone else prints money it may cancel each other out.

admthrwn
10th April 2009, 10:28
If everyone else prints money it may cancel each other out.

Excellent idea. If the whole world prints money, then everyone can be millionaire's or billionaire's. Thank god that Zimbabwee has been printing so much money, its just cancelling out our printing. Everyone in the world is gonna be rich!!

Katwoman
10th April 2009, 14:54
Excellent idea. If the whole world prints money, then everyone can be millionaire's or billionaire's. Thank god that Zimbabwee has been printing so much money, its just cancelling out our printing. Everyone in the world is gonna be rich!!

Yes especially the people of Zimbabwee just look at how printing money has improved their standard of living. in fact most of them are doing so well that instead of working the entire nation has taken up the hobby of panning for gold:D

admthrwn
10th April 2009, 17:56
Yes especially the people of Zimbabwee just look at how printing money has improved their standard of living. in fact most of them are doing so well that instead of working the entire nation has taken up the hobby of panning for gold:D

Exactly. See, our governments are truly looking out for us. Instead of forced servitude, they're giving us forced hobbyism. We are all going to be so much happier with our new labor intensive hobbies. Keep printing! :)