There is a ridiculous amount of time spent on what the Fed will do or won’t do or analysing the latest economic figures. Very few people use their own brain to figure out the obvious. And the obvious is that debt which has been growing exponentially in the last 40 years, started its parabolic phase in 2006 when Bernanke became chairman of the Fed. So we don’t have to ask what central banks will do. Because it is guaranteed that they will soon start unlimited money printing to complete the debt parabola.
That means we are now starting the hyperinflationary phase in the USA and many other countries. And this will all start in 2014. What will be the trigger? The answer is simple – the fall of the US dollar.
Hyperinflation is a currency event. It does not arise as a result of increase in demand but as the inevitable consequence of a collapsing currency. When a country for an extended period lives above its means and prints money which it can never pay back, the rest of the world will punish the country and its currency. It took the US over 200 years to reach a debt of US$8 trillion. Since Bernanke became chairman of the Fed in 2006, US debt has more than doubled to $17 trillion. That is an incredible ‘achievement’ and the beginning of the parabolic rise of US debt not by tens of trillions but by 100 of trillions of dollars. This is no different to the Weimar Republic or Zimbabwe and a completely natural consequence of what is happening now.
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In September 2011 the Gold Bugs index, the HUI stood at 630 as gold prices peaked, since then both have trended lower with the HUI losing about 65% of its value. The bottom has been called a number of times and after such a dramatic decline its difficult not to think that we are there now. However, as we all know the timing of any investment is crucial to its success and that is exactly what we are trying to do here, trying to pick advantageous entry and exit points. If you would like to know which stocks we are buying and selling please join us at ‘Stock Trader’ our premium investment service.
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