Seem's like the crooks are the only ones able to get ahead in this day and age.

The availability of gold as a liquid tradable commodity would, to an extent, reinforce its capacity as a proxy standard for currency exchange. However, the effect of open market speculation and trade noise would greatly diminish its effectiveness as the universal benchmark. Thus, the only way for a stable system of exchange using gold as the fundamental base currency would be to nationalize, or rather internationalize, the operation of this commodity. Gold would have to taken out of private ownership and restored into the hands of the global citizenry. Furthermore, this process of reconciliation and subsequent management of the standard requires unprecedented international cooperation just to ensure that adjustments to gold and/or currency volumes are pro-rationed to maintain ratio equilibria. Proportional commensuration is crucial to prevent mal-distribution and have people throwing fits when they discover their wealth diluted in this world of a universal currency. Before this happens, I suggest try getting Iran and Israel to sit side by side for 5 minutes without gouging eyeballs.

You should not believe a word the US Gov't says. Inflation is up 60% just this year, for groceries, & is expected to go up another 20% THIS MONTH ALONE. We could even be on the verge of "hyperinflation," who knows? It is ridiculous what Bernake claims the CPI is. And inflation is not anywhere close to 3.5%!

Out here in the trenches, I've seen moms standing in line in the grocery store putting babyfood back, when they can't pay the bill. I've paid for their groceries on a few occasions. There are people who have stopped driving their cars altogether, since they must make a choice between food & gas. ($4/gal, going to $5, 6 & now I'm hearing $7.)

Not to mention employment. The true number is somewhere around 12-15%. About 1 out of every 8 people I know is unemployed.(None of the realtors or mortgage brokers will show up on the unemployment rosters, since they were "independent contractors....but the existing offices all have skeleton crews,) & vacating agents are mostly unemployed, & can't find jobs. The peripheral businesses are falling off like flies, too - furniture companies are losing people (no sales,) & many are closing their doors. Every business that depends upon real estate is in decline.

The #1 problem IS the falling dollar. We need less gov't & a leader who understands economics, or has the sense to put someone who does into a position of responsibility, & bring in someone to regulate the irresponsible credit & mortgage industries, too.

The #2 problem is that America needs to GET BACK TO WORK. With all the OUTSOURCING going on, no wonder America is unemployed/ underemployed! Can we get those jobs back? NO! Because why pay an American $15/hr when someone in India will do the work for $1.50/hr? So we must take the ball & run with it ourselves. Where is the ingenuity we once had, many years ago? We need a new invention to replace the car, and to RE-THINK the way it RUNS. This is what we should be working toward.

America is a great country where people of all walks of life can achieve their DREAMS. We have always been pioneers in the world. We came up with the railroad, then autmobiles. We came up with the space program & the shuttle. We lead the world in films, multi-media, & much more. We are all interdependent. When America sneezes, the rest of the world gets a cold. So it will be in everyone's best interest to begin thinking globally, & start working together. America needs to re-invent itself to be a player in this new global marketplace.

Gold will be reintegrated (as money) by the market, bottom-up, but this time around , it will not be based on a fixed peg !!! The peg had to go. Gold was NEVER a problem, only the logistics of past gold systems presented a problem. A fixed peg could never reflect supply-demand fundamentals between currency supply and gold supply. The need for more currency under a fixed peg system such as Bretton Woods meant needing more gold. Doesn't work.

Now , however, gold can be related to currency in real time. Digital currency backed by 100% gold weight , where accounting by weight is "shipped" from account to account makes for a debt free transaction. Liquidity with no debt ..... global ...... seamless ! The ability to "slice off" a tiny piece of gold is where the measurement using currency has its place ..... any currency. Gold is then recentralized as it should be. Balance.

Think. If this is a bottom-up market evolution, it needs market participation and a massive move toward gold, even if it's just as an investment at this time. Is that monetary transition best served in an inflationary or deflationary environment ?

We're getting near the end of the last act. Won't those commodity based ETF's make wonderful personal monetary reserves .....in time?

There's also that element of needing to save face (though I admit not much of a face remains for Ben & gang). As much as I loathe Ben for his demonstrated incompetencies, he deserves some sympathy for having inherited that one-wheeled tricycle of an economy. I look to his predecessors for answers. Not such feeling towards Paulson though, he's a prick.

"But with the official CPI at 4.2%"

The 'official' inflation figure published by the RBA is so constrainted by assumptions that it lives in its own la la land. And CPI takes into account of a generalized basket of goods/services. What would core inflation be for essential goods alone like food, fuel and raw materials?

As for Hedge Duds, they've been pruning investment capital for yonks. It's always going to be a spectacular hazard when the derivatives market (essentially just a bunch of contracts) is numerous folds the size of the underlying assets market they represent. It's nuts - and now that the primary focus is on inflation, one should be very wary of several new and upcoming innovations including those dubious "inflation hedges" and swap-based arrangements. It seems to me that sheep's clothing is no longer adequate disguise for the wolf - if I were institutions, I would probably ditch the word 'hedge' for something less conspicuous like 'Tip Top Inflation Pruning Swear to God Fund'.