All Posts Tagged With: "central banks"

What is more likely is that over the coming months, we will get another deflationary scare. Any sell-off in the markets later this year will be met by an even larger stimulus from the policymakers and this will ultimately result in high inflation.

Our heroine, Angela Merkel, made the front-page news yesterday. She stood up against almost every mainstream economist, politician, and central banker in the world – and gave them all hell.

We have it from our usually unreliable source in Washington that Gideon Gono, now head of the Zimbabwean central bank, has been called in to aid the Obama Administration. In secret talks, Gono has agreed to replace the out-going Ben Bernanke, who is said to be going to work as a helicopter pilot. Gono will take over the Fed. And a new bill has already been designed – our source was able to sneak out a copy of the new note – for 1 million U.S. dollars. That’s Gideon Gono’s picture on it…

We have a lot of respect for our many American readers because many of them are long-time readers, friends, and family. We were born and raised in Colorado, lived on the East Coast (Baltimore and Washington DC) for ten years before moving to Europe (Paris and London) for three years, and now Australia for the last three years. It’s not Americans we’re upset with. It’s American politicians. We can’t tell you how many times in the last five years people asked us if we were Canadian…

In the current monetary system, however, the supply of money is not constant and the central banks of this world are free to create as much inflation (money-supply growth) as they want. There is a catch – the central banks can only do so as long as they can keep inflationary fears in check by constantly reminding the public of the threat of deflation.