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XMFSinchiruna (26.54)

Marc Faber - U.S. Employing the "Zimbabwe School of Economics"



February 11, 2009 – Comments (2)

Faber issues some seriously notable quotables in this gem from CNBC this morning:

Pursuring the Zimbabwe School of Economics:

If something goes wrong, print. If that doesn't fix it, print more. If it still gets worse, print again.

Also, when he examines total debt, Faber views inflation as the only possible alternative to physical default, which strikes at the heart of why I've been issuing the inflationary alerts even in the midst of this apparently ravenous deflationary spiral.

His assertion that the FED can effectively never return to real interest rates is also spot on.

The dollar is toast. Without asserting a timeline for the events that will unfold, I agree 100% with Faber that inflation is baked into the cards already, with a default on our debt being the only means to prevent it. Since USD is the reserve currency of the world, of course either one of those scenarios is intensely dollar-negative. This is why I've been positioned in gold, silver, and energy since 2004, and will continue to remain so positioned until I can identify real signs of a bottom for the USD. Sufice to say, I believe we have a LONG way to go, short-term volatility and rampant manipulation by conjoined central banks and mega-banks at the trough of free money notwithstanding. :)

Fool on!

2 Comments – Post Your Own

#1) On February 11, 2009 at 10:14 AM, abitare (29.90) wrote:

Good post, sorry I double it.

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#2) On February 11, 2009 at 2:00 PM, RonChapmanJr (29.77) wrote:

Nobody really knows whats going to happen. 

However it goes down, I am recommending that everyone - "hope for the best and prepare for the worst" -

I'd rather have food and ammo than gold and silver if it all gets super crazy.  



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