Original Timeline
End of 1st Quarter U.S. Treasury Bond Auction Failure
End of 2nd Quarter U.S. Sovereign Debt Downgrade
End of 3rd Quarter U.S. Dollar Crisis
End of 4th Quarter Rapidly Rising US Inflation
End of 1st Quarter U.S. Treasury Bond Auction Failure
End of 2nd Quarter U.S. Sovereign Debt Downgrade
End of 3rd Quarter U.S. Dollar Crisis
End of 4th Quarter Rapidly Rising US Inflation
(Thanks to Allan Brennan for his analysis)
Revised Timeline
End of 1st Quarter U.S. Federal Reserve buys its own Treasuries to artificially create demand and delay an overt Bond Auction Failure for perhaps until the End of 3rd Quarter.
End of 4th Quarter 2009 U.S. Sovereign Debt Downgrade
Early 1st Quarter 2010 U.S. Dollar Crisis
End of 2nd Quarter 2010 Rapidly Rising US Inflation
Revised Timeline
End of 1st Quarter U.S. Federal Reserve buys its own Treasuries to artificially create demand and delay an overt Bond Auction Failure for perhaps until the End of 3rd Quarter.
End of 4th Quarter 2009 U.S. Sovereign Debt Downgrade
Early 1st Quarter 2010 U.S. Dollar Crisis
End of 2nd Quarter 2010 Rapidly Rising US Inflation
Eventually, a new currency will be introduced to replace the US dollar.
Several wildcard factors were introduced to the timeline in the past month:
a) The Fed began to bid on and buy its own Treasuries
Several wildcard factors were introduced to the timeline in the past month:
a) The Fed began to bid on and buy its own Treasuries
http://www.bloomberg.com/apps/news?pid=20601087&sid=aDaFOJl.n9yk&refer=home
b) The IMF announced it will sell 1/8th of its gold supply, releasing 400 tons into the market in an attempt to suppress the price.
b) The IMF announced it will sell 1/8th of its gold supply, releasing 400 tons into the market in an attempt to suppress the price.
http://www.commodityonline.com/news/Gold-and-gold-stocks-set-for-biggest-trades-in-2009-16740-3-1.html
c) Implementation of Mark to Market rules has been delayed to allow banks to post earnings first.
http://www.independent.co.uk/news/business/news/us-suspends-marktomarket-rules-on-bank-assets-1661117.html
Overall, none of the factors that led us into this credit mess have been adequately addressed. The banks are still overleveraged and opaque, sovereign debt is growing incredibly fast, and government spending is out of control. The wildcards are whitewash on an old shack with holes in the roof and walls. Or, to put it another way, it’s the same stinky pig, but with painted nails and lipstick.
c) Implementation of Mark to Market rules has been delayed to allow banks to post earnings first.
http://www.independent.co.uk/news/business/news/us-suspends-marktomarket-rules-on-bank-assets-1661117.html
Overall, none of the factors that led us into this credit mess have been adequately addressed. The banks are still overleveraged and opaque, sovereign debt is growing incredibly fast, and government spending is out of control. The wildcards are whitewash on an old shack with holes in the roof and walls. Or, to put it another way, it’s the same stinky pig, but with painted nails and lipstick.
As investors and citizens, we need to be aware where the logical destination of all the debt and money printing leads.
It is not a happy place.
The actions of numerous governments so far lead me to conclude that they will insist on debasing their fiat currencies which leaves investors few places to hide from the inflation that will eventually follow.
We will examine some of these hiding places in a future post shortly.
Just started visiting this website - quite informative...
ReplyDeleteHappily not all in US Gov are blind to it; for example Ron Paul:
http://www.freedomsphoenix.com/Feature-Article.htm?Info=0086964&From=News
Another is Gerald Celente:
http://www.youtube.com/watch?v=2_R_ggsngVk&feature=related
That being offered, there are just so many signs of big, big trouble.