Buchanan talking about the economy and our sinking dollar:
The euro, worth 83 cents in the early George W. Bush years, is at $1.45.
The British pound is back up over $2, the highest level since the Carter era. The Canadian dollar, which used to be worth 65 cents, is worth more than the U.S. dollar for the first time in half a century.
Oil is over $90 a barrel. Gold, down to $260 an ounce not so long ago, has hit $800.
Have gold, silver, oil, the euro, the pound and the Canadian dollar all suddenly soared in value in just a few years?
Nope. The dollar has plummeted in value, more so in Bush's term than during any comparable period of U.S. history. Indeed, Bush is presiding over a worldwide abandonment of the American dollar.
The reason gold has hit the historic highs this week is not only in response to the uncertainty of world events, but as a response to the hundreds of billions of dollars that the Fed has pumped into the economy in the past few months. M3, or the money supply, (which the government stopped publishing a few years ago) has been calculated by some private entities to be as high as 14 percent. Is it doom and gloom time? Yes. We are witnessing something historic, we are witnessing the flight away from the dollar as the reserve currency in the world.
Gold and bicycles people, put your money into gold and bicycles.
Can our problems be easily solved? Well the answers are easy, but it will take sacrifice. We need to give up the empire that we have. Take the troops out of South Korea, of Europe, and yes, Iraq. Put that money into the liabilities that we have here at home. Social Security, medicare, can all be paid for if we stop being the policeman of the world. It's tough medicine, but the country will be better off in the long run.
1 comment:
Buchanan has it backwards. Trade deficits mean American dollars going abroad in exchange for foreign goods. If foreigners never cashed in those dollars, then Americans would essentially be getting foreign goods for free. This is essentially what has been happening for decades as foreign countries accumulated dollars, and foreign investors invested in American companies.
A trade surplus means American goods going out in exchange for foreign currency. A surplus is a form of investing in other countries, since that is where we have to spend that foreign currency.
What is happening now is that all those foreign governments are cashing in on the dollars they have been hoarding - so a SURPLUS is what we should be worrying about.
The reason that foreign governments are finally cashing in is due to the inflationary policy of the Federal Reserve - due to the growing federal deficit. The dollar no longer suffices as a form of insurance against foreign nation's own inflationary policies.
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