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Old 02-23-2014, 05:54 PM
Danny B Danny B is online now
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Join Date: Oct 2012
Location: L.A. Ca.
Posts: 3,165
Too many dollars,, no takers

In a general sense, deflation is a reduction in the supply of currency and credit. There is a second aspect to deflation; a reduction in the value of debt instruments. The world is awash in debt instruments and this dilutes their value. When the value of each (currency) debt instrument falls fast enough, we call this hyperinflation. It is more correctly called hyperdeflation of the debt note.
In a true deflation, the currency goes UP in value because there are fewer of them. BUT, as the currency gets more valuable, debtors are less able to pay back loans. The banksters always print more to keep debtors from defaulting. They would rather suffer from currency devaluation that default.

True deflation is very rare with fiat currency because it is so easy to switch on the presses. The presses are switched on adequate to rescue debt that is in danger of default. This time around, the debt bubble was allowed/forced to grow so big that the presses can't realistically be expected to rescue the debt.

The FED is printing a reported $ 80 B a month. Jim Willie claims that it is actually 3--4 times that amount. China is printing about 4 times as much as the FED claims to be printing. Japan is printing with wild abandon.
People lose jobs,,, companies lose sales. The press makes all the payments that they are missing. There is currency creation as a substitute for wealth creation.
The economy is composed of production & consumption,,,supply & demand. The printing press is only a temporary substitute.
Eventually the supply of currency has nowhere to go.

"(7), resulting in a surplus of dollars and an increase in demand for the local currency, causing it to rise automatically (8). For example, in such a period Turkey, India, Brazil and Indonesia among others, have each offloaded in the order of tens of billions of Dollars per month (9).

This means that Dollar buyers, the emerging countries, have become sellers. In other words, the only countries able to absorb excess Dollars are now refusing them. Let’s recapitulate: the Fed and the Treasury continue to flood the world with $65 billion a month, but no one wants them… Where can they dump them now? In a few oil producing countries which still sell in Dollars, but especially in the US of course. And what can this country’s lifeless economy do with them? Not a lot… certainly less than the emerging countries did (10). "
GEAB N°82 is available! 2014, resumption of the global systemic crisis’ « normal » path

"Fred Sheehan: The globalists will be sorely disappointed. You are probably correct in what they want. The opposite is happening. We are in a period of disintegration. For instance, the Eurocrats have so abused any trust – any willingness among the people to sacrifice to the greater good – that their only future is to be filleted and served alongside a plate of Brussels sprouts. The globalists are aligned with vast bureaucracies filled with the sort of self-satisfied, test-taking, personally ambitious, know-nothings who only serve their own interests. They have no sense of duty, honor, self-sacrifice, all of which are necessary to achieve what they wish. They will crumble. - See more at: The Daily Bell - Fred Sheehan on the Futility of Wall Street, the Coming Derivatives Disaster and the Craziness of Keynes
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