The world economic crisis or money making machine

dollar is worthless piece of paper 2008-08-23 In recent days, we are witnesses of the "terrible" economic crises all over the world markets. The banks abortions and their subsequential retrieval is the hit of the last days. Big names are dying to be resurrect by all mighty dollar printing company - federal reserve. But who will pay this loan and who will make profit from this scam? What is dollar? Worthless piece of paper. States are no longer interested to trade or have their reserves in dollar today. That was its only value. Pumping $75 emergency loan into AIG means: Federal reserve (private company) printed more money - how easy. Giving them to AIG (private company). Dow index dives, because more dollars is printed (inflation). American tax payers will pay for this scam. Fortunately there is no law to pay this tax, but they will anyway. Well done. Just don't try to print money yourself at home or you will be arrested as a criminal.

Facts about Federal Reserve and inflation

printing gift for AIG Another reason there is a flight from the dollar is our incredible debt. Consider that the national debt is already $9 trillion. It was under Reagan the debt first hit $1 trillion. Under President Bush, the national debt has risen some $4 trillion alone - close to 45 percent of the current staggering load.

And remember, that's just the national debt and does not include the state, local and consumer debt.

No doubt, our debt is frightening to global investors. A Dutch professor of economics put it bluntly to me recently: "America is heading for bankruptcy." Interesting, a popular television dramatization in the Netherlands has been airing based on the dollar: "The Day the Dollar Collapsed."

Of course, the U.S. government won't actually go bankrupt. It will pay its bills. But these dollars will be grossly inflated and devalued. The government usually reverts to the easiest political solution, which, in this case, is to print more money. Inflation ensues. The dollar weakens.

This is good for debtors who will see the real value of their debts shrink. But it is terrible for creditors.

Since global investors like the Chinese have acted as America's creditors, buying our debt instruments, they are clearly realizing how dangerous it is to continually underwrite U.S. debt in dollars.

China has $1.4 trillion in foreign reserves; 70 percent of this is in dollars. While recently affirming that the dollar will remain China's reserve currency, its central bank has also indicated it will diversify out of the dollar.

As long as Washington ignores the underlying causes - significantly stealth inflation - the U.S. dollar will continue to weaken, imperiling our economic standing.

Source: Newsmax.com, Timesonline.co.uk

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