FED set to inject(print) 1 trillion dollars into economy over 2013

[tbombz]

The fed is going to purchase 85 billion dollars in mortgages and treasury securities every month.  That works out to 1.02 trillion dollars over the year. 

[Roger Bacon]

The fed is going to purchase 85 billion dollars in mortgages and treasury securities every month.  That works out to 1.02 trillion dollars over the year. 

what do you think about that?

[tbombz]

Could be a real smart way to funell money through the banking system in an effort to monetize the debt

[GigantorX]

Could be a real smart way to funell money through the banking system in an effort to monetize the debt

Monetizing debt isn't smart and always ends badly.

It also shows that the economy is still in the crapper. Remember to always watch what they do not what they say.

[tbombz]

We all know the economy isn't improving in a significant, qualitative way. But it doesn't seem to be getting any worse. Things are very mildly getting better in quantitative terms.  Monetizing debt sounds absolutely horrible on the surface but when you possess the reserve currency of the entire planet I think it changes the game a bit.

[Conker]

All this goddam printing money, gonna need a wheelbarrow to go buy a loaf of bread soon!

[magikusar]

end the fed

[Mr.1derful]

We all know the economy isn't improving in a significant, qualitative way. But it doesn't seem to be getting any worse. Things are very mildly getting better in quantitative terms.  Monetizing debt sounds absolutely horrible on the surface but when you possess the reserve currency of the entire planet I think it changes the game a bit.

Not for long.

[GigantorX]

Not for long.

Exactly.

When we can no longer monetize our debt with impunity we will finally see the final endgame.

[24KT]

All this goddam printing money, gonna need a wheelbarrow to go buy a loaf of bread soon!

That all depends on what one uses for money. If you're using fiat paper, ...perhaps (most likely), but if you're using currency grade gold... you'll be smiling... provided you convert your paper to gold before gold skyrockets.

We all know the economy isn't improving in a significant, qualitative way. But it doesn't seem to be getting any worse. Things are very mildly getting better in quantitative terms.  Monetizing debt sounds absolutely horrible on the surface but when you possess the reserve currency of the entire planet I think it changes the game a bit.

It changes nothing. People, banks, institutions etc., ... those who use and/or require money will simply stop accepting your currency and will start demanding gold, or currency backed by gold.

[tbombz]

Id like to see them try that

[24KT]

Id like to see them try that

It's currently happening now. Businesses are starting to accept currency grade gold as an alternative to paper money & debit/credit cards.

Then there is China which fully intends to back their yuan with gold.

Come January 1st 2013, Basel III comes into play, where currency gold becomes a zero-risk rated asset.

[WOOO]

better financial system regulations are still required

[Conker]

That all depends on what one uses for money. If you're using fiat paper, ...perhaps (most likely), but if you're using currency grade gold... you'll be smiling... provided you convert your paper to gold before gold skyrockets.

It changes nothing. People, banks, institutions etc., ... those who use and/or require money will simply stop accepting your currency and will start demanding gold, or currency backed by gold.

I was actually joking! I think there is some way to go before the scenarios you're suggesting would even become a remote possibility. Japan has been printing money for a couple of decades and they are still struggling to inject even a drop of inflation into their economy.

The countries that have suffered hyperinflation after printing money have been already basket case economies like Zimbabwe and 20s Germany. I very much doubt this latest round of QE will have any serious impact in undermining your currency.

[24KT]

I was actually joking!

  OK, it's official. Ron really needs a sarcasm smiley.
I'm beginning to feel like Prime. lol. Oh well, I'm in good company.

I think there is some way to go before the scenarios you're suggesting would even become a remote possibility.

I don't think there is as much room as people think.

Japan has been printing money for a couple of decades and they are still struggling to inject even a drop of inflation into their economy.

Don't kid yourself, Japan has inflation. Their economy has been stagnant forever. There's a reason they call it Japan's lost decade. In addition, Japanese debt is being borne strictly by Japanese citizens, and is contained to Japan. The USA on the other hand is exporting inflation all over the planet.

The countries that have suffered hyperinflation after printing money have been already basket case economies like Zimbabwe and 20s Germany.

LOL. I rest my case. 

I very much doubt this latest round of QE will have any serious impact in undermining your currency.

It won't harm MY currency. I use 24KT 999.9 fine LBMA gold as my currency.

As for my nation's fiat currency... well Canada has a lot of oil, precious metals and other resources, and we've managed our economy quite a bit more responsibly than the USA, ...but still 70+% of our exports currently go to the USA, so we will no doubt be adversely affected by the looming US fiscal cliff. Free trade deals with India & China can't come online fast enough. Not sure I care for the recent assets sale to China, but the USA is currently a huge liability.

[Mr.1derful]

OK, it's official. Ron really needs a sarcasm smiley.
I'm beginning to feel like Prime. lol. Oh well, I'm in good company.

I don't think there is as much room as people think.

Don't kid yourself, Japan has inflation. Their economy has been stagnant forever. There's a reason they call it Japan's lost decade. In addition, Japanese debt is being borne strictly by Japanese citizens, and is contained to Japan. The USA on the other hand is exporting inflation all over the planet.

LOL. I rest my case.  

It won't harm MY currency. I use 24KT 999.9 fine LBMA gold as my currency.

As for my nation's fiat currency... well Canada has a lot of oil, precious metals and other resources, and we've managed our economy quite a bit more responsibly than the USA, ...but still 70+% of our exports currently go to the USA, so we will no doubt be adversely affected by the looming US fiscal cliff. Free trade deals with India & China can't come online fast enough. Not sure I care for the recent assets sale to China, but the USA is currently a huge liability.

You're speaking to the choir.

[24KT]

You're speaking to the choir.

1derful!!!  {pun intended} Are you into karatbars, UBS or pamp suisse?

I hope you're acquiring the smallest denominations possible.

[Mr.1derful]

1derful!!!  {pun intended} Are you into karatbars, UBS or pamp suisse?

I hope you're acquiring the smallest denominations possible.

1 oz Maples.

[Conker]

OK, it's official. Ron really needs a sarcasm smiley.
I'm beginning to feel like Prime. lol. Oh well, I'm in good company.

I don't think there is as much room as people think.

Don't kid yourself, Japan has inflation. Their economy has been stagnant forever. There's a reason they call it Japan's lost decade. In addition, Japanese debt is being borne strictly by Japanese citizens, and is contained to Japan. The USA on the other hand is exporting inflation all over the planet.

LOL. I rest my case. 

It won't harm MY currency. I use 24KT 999.9 fine LBMA gold as my currency.

As for my nation's fiat currency... well Canada has a lot of oil, precious metals and other resources, and we've managed our economy quite a bit more responsibly than the USA, ...but still 70+% of our exports currently go to the USA, so we will no doubt be adversely affected by the looming US fiscal cliff. Free trade deals with India & China can't come online fast enough. Not sure I care for the recent assets sale to China, but the USA is currently a huge liability.

The reason for Japan's "lost decade" is down to their decade(and more) battle against deflation, as I said no matter how many rounds of QE they have had it has had little effect on creating a healthy rate of inflation.

Inflation rate in Oct 2012 in Japan was -0.4% . Table of Japanese inflation over last decade.
http://www.rateinflation.com/inflation-rate/japan-historical-inflation-rate


I wouldn't be surprised if we see something similar in the US and most of Europe over the next decade or so.

[GigantorX]

The reason for Japan's "lost decade" is down to their decade(and more) battle against deflation, as I said no matter how many rounds of QE they have had it has had little effect on creating a healthy rate of inflation.

Inflation rate in Oct 2012 in Japan was -0.4% . Table of Japanese inflation over last decade.
http://www.rateinflation.com/inflation-rate/japan-historical-inflation-rate


I wouldn't be surprised if we see something similar in the US and most of Europe over the next decade or so.

Japan never let the economy correct itself, they had huge imbalances and gigantic bubbles that all popped. They went on a debt/stimulus/bailout spree and did nothing but feed the zombies. The junkie needed to go through detox and get cleaned up but instead he has been shooting more heroine and taking methadone.

Deflation can be a healthy product of a bubble/credit cycle. It clears out debt, teaches a valuable lesson and balances things. Japan has spent 30 years fighting the tide and it isn't working.

And an honest question for you: Where do you see any appreciable amount of deflation in the U.S.?

[24KT]

1 oz Maples.

Eeek!!! Government issued gold.

I suppose maples are better than Eagles...but, ...it's still gov't issued.
...even if it's issued by my own government which I distrust just slightly less than I distrust the USA government.

What are you going to do when gold drastically revalues upwards?

If your Maple Leaf becomes suddenly worth $5K or even $10K, ...or even $20K or higher... how are you going to purchase goods or services? You'd have to liquidate the entire ounce and receive change... how? ...in worthless Zimbabwe Federal Reserve notes?  

Wouldn't you rather be able to liquidate only what you needed when you needed it? ...like a few grams... or even in fractions of a gram? ...and get your change back in gold?

I just heard the Central Bank of Greece will be producing a 1 gram 999.9 alloyed numismatic coin commemorating the ancient city of Pella? While I think the small transaction friendly weight is a great start, it's not LBMA, not produced in a GDL refinery, isn't considered currency grade, and unfortunately like the majority of coins, loses it's certification for authenticity, the moment it leaves the mint.

Only Karatbars, UBS kinebars, and Pamp Suisse 1 gram weights are LBMA, and remove the burden of proof from the bearer.

[24KT]

Japan never let the economy correct itself, they had huge imbalances and gigantic bubbles that all popped. They went on a debt/stimulus/bailout spree and did nothing but feed the zombies. The junkie needed to go through detox and get cleaned up but instead he has been shooting more heroine and taking methadone.

Deflation can be a healthy product of a bubble/credit cycle. It clears out debt, teaches a valuable lesson and balances things. Japan has spent 30 years fighting the tide and it isn't working.

And an honest question for you: Where do you see any appreciable amount of deflation in the U.S.?

In the puffed up chests and egos of Republican voters?   

[Mr.1derful]

Eeek!!! Government issued gold.

I suppose maples are better than Eagles...but, ...it's still gov't issued.
...even if it's issued by my own government which I distrust just slightly less than I distrust the USA government.

What are you going to do when gold drastically revalues upwards?

If your Maple Leaf becomes suddenly worth $5K or even $10K, ...or even $20K or higher... how are you going to purchase goods or services? You'd have to liquidate the entire ounce and receive change... how? ...in worthless Zimbabwe Federal Reserve notes?  

Wouldn't you rather be able to liquidate only what you needed when you needed it? ...like a few grams... or even in fractions of a gram? ...and get your change back in gold?

I just heard the Central Bank of Greece will be producing a 1 gram 999.9 alloyed numismatic coin commemorating the ancient city of Pella? While I think the small transaction friendly weight is a great start, it's not LBMA, not produced in a GDL refinery, isn't considered currency grade, and unfortunately like the majority of coins, loses it's certification for authenticity, the moment it leaves the mint.

Only Karatbars, UBS kinebars, and Pamp Suisse 1 gram weights are LBMA, and remove the burden of proof from the bearer.

I'm mainly in silver, with a small amount of gold also.  Maples are very pure and liquid.  My typical recommendation is start with Maples, then add in bars.

[Conker]

Japan never let the economy correct itself, they had huge imbalances and gigantic bubbles that all popped. They went on a debt/stimulus/bailout spree and did nothing but feed the zombies. The junkie needed to go through detox and get cleaned up but instead he has been shooting more heroine and taking methadone.

Deflation can be a healthy product of a bubble/credit cycle. It clears out debt, teaches a valuable lesson and balances things. Japan has spent 30 years fighting the tide and it isn't working.

And an honest question for you: Where do you see any appreciable amount of deflation in the U.S.?

Well the other side of the coin is that if Japan hadn't taken the actions of fiscal stimulus they did/are ,deflation would have really taken a hold and their economy could be in far worse state than it is now. They are after all still one of the wealthiest nations on earth, with a high standard of living.

I think the thing with deflation in the US(same as in UK)at present we have what are seen as temporary factors injecting inflation into our economies but the long term indicators suggest that deflation is the real fear. You simply wouldn't be printing money if that wasn't the case. Not to mention interest rates at near zero.

[24KT]

I'm mainly in silver, with a small amount of gold also.  Maples are very pure and liquid.

Relatively speaking.

  My typical recommendation is start with Maples, then move to bars.

I used to recommend Maple Leafs myself. I even used to own them, ...until I discovered Karatbars. Now Karatbars are my preference, not only for their purer content, but also their LBMA certification that remains with the gold, but also for the smaller more flexible, and affordable transaction friendly weights, potential for numismatic appreciation, but also  for their ease of liquidity, the ability to use them as currency, and the ability to acquire them for free etc.,...

I have found Karatbars to be the lowest priced 999.9 LBMA gram gold on the market, with the highest buy back price.