LIVE Gold Prices $  | E-Mail Subscriptions | Update GoldSeek | GoldSeek Radio 

Commentary : Gold Review : Markets : News Wire : Quotes : Silver : Stocks - Main Page 

 GoldSeek.com >> News >> Story  Disclaimer 
 
Latest Headlines

Gold Resource Corporation Declares May Monthly Dividend
By: Gold Resource Corporation

The Inflation-Deflation Conundrum
By: Michael Ballanger

Catching A Breath Before Ramping Higher
By: Ricky Wen

You Can't Just Print More Gold
By: Frank Holmes

Gold Resource Corporation Granted Government Approval to Restart Oaxaca Mining Unit
By: Gold Resource Corporation

Gold Update: Buying Opportunity Coming Soon
By: Gary Savage

Precious Metals Update Video: Trying to get back to normal, Gold has strong support just below
By: Ira Epstein

Asian Metals Market Update: May-27-2020
By: Chintan Karnani, Insignia Consultants

Trump vs. Biden: What’s at Stake for Metals Investors?
By: Stefan Gleason

Gold Stock Profits: A Horn Of Plenty
By: Stewart Thomson

 
Search

GoldSeek Web

 
Marc Faber Predicts US Hyperinflation Like Zimbabwe

By: Peter Cooper, Arabian Money


-- Posted Thursday, 28 May 2009 | Digg This ArticleDigg It! | | Source: GoldSeek.com

Images from the Weimar Republic of housewives using currency to heat their homes are bound to surface again as commentators discuss Dr. Marc Faber’s prediction of hyperinflation for the modern United States.

 

In an interview with Bloomberg TV he said: ‘The U.S. economy will enter hyperinflation approaching the levels in Zimbabwe because the Federal Reserve will be reluctant to raise interest rates.’

 

Dr. Faber claimed inflation might get to rates ‘close to’ Zimbabwe where inflation has reached 231 million per cent recently. He left no doubt about his prediction.

 

‘I am 100 percent sure that the U.S. will go into hyperinflation. The problem with government debt growing so much is that when the time will come and the Fed should increase interest rates, they will be very reluctant to do so and so inflation will start to accelerate.’

 

Over-the-top

 

Now perhaps the original Dr. Doom has lost it, or at least got a little carried away with the strength of his analogy. It is hard to equate the market savvy Obama administration with the corrupt court of Robert Mugabe, or to imagine a scenario that would bring such economic devastation.

 

But what Dr. Faber’s hyperbole does flag up is the possibility of a return to the inflation levels of the 1970s, or indeed something worse. It is true that what politicians are doing to head off an economic slump today does indeed have consequences for future inflation levels.

 

In short, pumping money into the global economy will eventually prove inflationary. The money supply is being recklessly expanded to accommodate rising levels of public spending, largely on zombie banks and bankrupt automobile companies.

 

Government control

 

At the moment this new money is only compensating for a collapse in the private sector, global trade and consumer spending. But it is far harder to take money out than put it in, and Dr. Faber’s point is that left-leaning politicians will be reluctant to downsize the public sector at the appropriate time.

 

The investment conclusion he draws is that gold and silver are the best options to beat inflation and that buying US treasuries is likely to be a complete disaster. Those buying T-bonds in the auctions this week might care to reflect on what hyperinflation, or something close to it, would mean for this asset class.

 

Oil or black gold would be another clear and major beneficiary from a trip down the hyperinflation road.


-- Posted Thursday, 28 May 2009 | Digg This Article | Source: GoldSeek.com


About Peter Cooper:
Oxford University educated financial journalist Peter Cooper found himself made redundant by Emap plc in London in the mid-1990s and decided to rebuild his career in Dubai as launch editor of the pioneering magazine Gulf Business. He returned briefly to London in 1999 to complete his first book, a history of the Bovis construction group.

Then in 2000 he went back to Dubai to become an Internet entrepreneur, just as the dot-com market crashed. But he stumbled across the opportunity to become a partner in www.ameinfo.com, which later became the Middle East's leading English language business news website.

Over the course of the next seven years he had a ringside seat as editor-in-chief writing about the remarkable transformation of Dubai into a global business and financial hub city. At the same time www.ameinfo.com prospered and was sold in 2006 to Emap plc for $27 million, completing the career circle back to where it began a decade earlier.

He remains a lively commentator and columnist as a freelance journalist based in Dubai and travels extensively each summer with his wife Svetlana. His financial blog www.arabianmoney.net is attracting increasing attention with its focus on investment in gold and silver as a means of prospering during a time of great consumer price inflation and asset price deflation.

Order my book online from this link




 



Increase Text SizeDecrease Text SizeE-mail Link of Current PagePrinter Friendly PageReturn to GoldSeek.com

 news.goldseek.com >> Story

E-mail Page  | Print  | Disclaimer 


© 1995 - 2019



GoldSeek.com Supports Kiva.org

© GoldSeek.com, Gold Seek LLC

The content on this site is protected by U.S. and international copyright laws and is the property of GoldSeek.com and/or the providers of the content under license. By "content" we mean any information, mode of expression, or other materials and services found on GoldSeek.com. This includes editorials, news, our writings, graphics, and any and all other features found on the site. Please contact us for any further information.

Live GoldSeek Visitor Map | Disclaimer


Map

The views contained here may not represent the views of GoldSeek.com, Gold Seek LLC, its affiliates or advertisers. GoldSeek.com, Gold Seek LLC makes no representation, warranty or guarantee as to the accuracy or completeness of the information (including news, editorials, prices, statistics, analyses and the like) provided through its service. Any copying, reproduction and/or redistribution of any of the documents, data, content or materials contained on or within this website, without the express written consent of GoldSeek.com, Gold Seek LLC, is strictly prohibited. In no event shall GoldSeek.com, Gold Seek LLC or its affiliates be liable to any person for any decision made or action taken in reliance upon the information provided herein.