Discussion in 'Wall St. News' started by Spectre2007, Dec 31, 2012.
print print print.. paper money vs hard assets/ arbitrage would be for conversion of paper into hard assets. The chinese are attempting to convert all that paper into purchasing US companies.
what is the end game... as long as the money supply doesnt hit main street, the easing is insulated. Big difference in giving Goldman Sachs 50 billion, versus 5,000 to a million Joe Plumbers.
Be bullish on paper and ink.
No doubt they can keep going for quite a while. But eventually it is going to end. And badly.
Not necessarily. It depends on how well Congress cooperates with Fed policy and avoids actions that put a monkey wrench in the works. My concern is the rudimentary, and inadequate, understanding of political and behavioral economics that too many in Congress seem to exhibit.
You have to have one policy or another with the majority rowing in the same direction. We currently have two different teams rowing in opposite directions. That's not good.
I said two years ago that we would see increased foreign acquisition of U.S. assets that will appreciate with U.S. inflation. That's what we are seeing. This is the way you hedge against future inflation in the U.S. economy. You convert your dollar denominated Treasury securities into cash and use that cash to buy U.S. assets. If you fail to do that, you will be paid on your fixed yield bonds in dollars with less buying power than the dollars you loaned. That's the equivalent of having the yield on your bonds lowered retroactively.
There is about $1 trillion dollar bills and coins in circulation as on June 20, 2012
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