-- Posted Friday, 29 February 2008 | Digg This Article
| Source: GoldSeek.com
Rick’s Picks
Friday, February 29, 2008
“Phenomenally accurate forecasts”
In testimony before Congress this week, Helicopter Ben finally acknowledged publicly what most of us have assumed all along – that the Fed will continue to ease no matter what. As an unstudied idea it sounds do-able, especially with the alleged “experts” who interpret Fed policy on the evening news still working so hard to persuade us that more easy credit is somehow going to reverse a debt deflation. We didn’t monitor the hearings, but we’d be surpised if the Fed chairman’s schpiel did not turn fast and loose during those presumably brief intervals when Ron Paul may have left the room.
With or without Rep. Paul present, you can bet Mr. Bernanke did not include in his presentation a chart like the one shown above. It is a vivid picture of a dollar in mortal agony as it once again plumbs new all-time lows. Since 2002, when the greenback’s bear market began, it has fallen nearly 40 percent. What’s worse, and a fact never even pondered by the pundits, is that the currencies against which the dollar has been losing ground are intrinsically worthless themselves. Keep that in mind the next time you hear some commentator talking about a “strong” euro, or a rampaging yen, for they are strong only in comparison to a U.S. currency so frail that it appears barely able any longer to muster a death rattle.
Damn-the-Torpedoes
That frailty is what makes the Fed’s damn-the-torpedoes course so dangerous to pursue. And you don’t have to be an economist to see that danger in the chart, either. How much more pounding does the dollar look like it can take? And how much of an economic stimulus does the Fed think it can create if its chosen method implies the further destabilization of the global currency system. Unfortunately, the one thing the Fed cannot do right now is appear to do nothing. Seen in that light, a 25-basis-point cut per month over the next several months could simply be a stall tactic, one designed to be ineffectual and harmless while we wait for our tax rebates to arrive in May. If so, it is probably more accurate to say fiscal and monetary policy are being guided now by prayer rather than by politics or, least of all, economics.
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Four Seats Left
The 12 seats I’d allotted for the March 8-9 Hidden Pivot seminar are two-thirds gone. If you’d like to attend this online event, click here for further details and instructions on how to register. The class will be held on Saturday/Sunday from 9:00 a.m. to 12:30 p.m. Mountain Time. If you want to learn how to forecast stocks and commodities as confidently and precisely as top pros, this is an opportunity you should not pass up.
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Information and commentary contained herein comes from sources believed to be reliable, but this cannot be guaranteed. Past performance should not be construed as an indicator of future results, so let the buyer beware. Rick's Picks does not provide investment advice to individuals, nor act as an investment advisor, nor individually advocate the purchase or sale of any security or investment. From time to time, its editor may hold positions in issues referred to in this service, and he may alter or augment them at any time. Investments recommended herein should be made only after consulting with your investment advisor, and only after reviewing the prospectus or financial statements of the company. Rick's Picks reserves the right to use e-mail endorsements and/or profit claims from its subscribers for marketing purposes. All names will be kept anonymous and only subscribers’ initials will be used unless express written permission has been granted to the contrary. All Contents © 2008, Rick Ackerman. All Rights Reserved. www.rickackerman.com
-- Posted Friday, 29 February 2008 | Digg This Article | Source: GoldSeek.com
