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URGENT: The Printing Presses Have Been Started

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Basically I think it's great, just a little too dense - I've been searching on the net for some pyramid graphics I've seen that do the same thing you are doing, but in a pyramid form. I think the pyramid is easier on the eye and can possible get across the same information - maybe do both? I'll keep looking for an example or two, I have them in several reference books I have...

 

Anything that helps wake up the sheeple will be great! If they could take the diagram and ask their lecturers, MPs, Congressmen, etc for an answer then it would be doing its job.

 

What I want to ensure is that everything on my chart is real and verifiable - people may not beleive it at first in it's entirety, but if they are interested in one area it may lead them to see the bigger picture.

 

With your help CDS, I think we will be able to create a robust document that would back up the diagram. This may mean I am able to simplify the diagram to some key messages/points.

 

I will think about using pyramids - if you have an example then that will help.

 

Regards,

 

FWIW

 

 

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Excellent, Ill keep looking, altho I got distracted by this one for a moment - http://preview.tinyurl.com/2vru83

 

The one I'm after shows the pyramid of control, and includes the fed, cfr, comm of 300, bilderbergers, riia etc etc and how they all work in unison.

 

hmmm - I don't think i'll bother turning that one into a visio! But it may get more attention from the sheeple!!!

 

LOL

 

:lol:

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Bernanke Says Fed May Buy Treasuries to Aid Economy

By Scott Lanman and Vivien Lou Chen

http://www.bloomberg.com/apps/news?pid=206...&refer=home

 

Dec. 1 (Bloomberg) -- Federal Reserve Chairman Ben S. Bernanke said he has “obviously limited” room to lower interest rates further and may use less conventional policies, such as buying Treasury securities, to revive the economy.

 

The U.S. economy “will probably remain weak for a time,” even if the credit crisis eases, Bernanke said today in a speech in Austin, Texas. While the Fed can’t push interest rates below zero, “the second arrow in the Federal Reserve’s quiver -- the provision of liquidity -- remains effective,” he said.

 

Bernanke’s comments pushed Treasury yields to record lows. Bernanke has created more than $2 trillion of emergency lending programs in the past year, using the Fed’s balance sheet and money-creation authority to cushion the economy from the worst financial crisis in seven decades. The central bank may lower its benchmark interest rate to zero, economists said.

 

“Although further reductions from the current federal funds rate target of 1 percent are certainly feasible, at this point the scope for using conventional interest-rate policies to support the economy is obviously limited,” Bernanke said in remarks to the Austin Chamber of Commerce.

 

One option is for the Fed to buy “longer-term Treasury or agency securities on the open market in substantial quantities,” Bernanke said. “This approach might influence the yields on these securities, thus helping to spur aggregate demand.”

 

Treasury prices rose on Bernanke’s remarks, with yields on 10-year Treasuries tumbling 25 basis points to a record low of 2.67 percent at 2:31 p.m. in New York, according to BGCantor Market Data. The yield was the lowet since daily Fed records started in 1962 and the least since 1955 as measured on a monthly basis. One basis point is equal to 0.01 percentage point.

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another bailout needed

 

Schwarzenegger declares fiscal emergency in Calif.

Monday December 1, 4:11 pm ET

By Juliet Williams, Associated Press Writer

Schwarzenegger declares fiscal emergency, calls lawmakers into special budget session

 

SACRAMENTO, Calif. (AP) -- Gov. Arnold Schwarzenegger declared a fiscal emergency Monday and called lawmakers into a special session to address California's $11.2 billion deficit.

 

The state's revenue gap is expected to hit $28 billion over the next 19 months without bold action. The emergency declaration authorizes the governor and lawmakers to change the existing budget within the next 45 days.

 

ADVERTISEMENT

Without quick action, the state is likely to run out of cash in February.

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http://www.traderview.com/economiccommenta...cCommentary.asp

 

It is despicable that Washington views the problems in terms of people not borrowing enough to FUEL the economy. Look no further than Hank Paulson’s own words last Tuesday:

“Millions of Americans,” says the U.S. Treasury secretary, were being denied credit or facing rising credit card rates, “making it more expensive for families to finance everyday purchases”.

 

The notion that families should finance everyday purchases on credit suggests Washington has still to understand what brought us here in the first place. Income is collapsing and the only way to fix it is wages and thriving small businesses.

The public has been scared out of their wits (as they should be). They have been encouraged for decades by public servants and the BANKING industry to borrow and spend on items they cannot and could not afford. This has now placed them and the countries in which they live on the brink of bankruptcy. This lending was the solution to collapsing income as the G7 deindustrialized and substituted ASSET INFLATION for rising incomes and wealth creation. Now the public servants are desperate for them to BORROW MORE and go further into DEBT SLAVERY to the fraudsters at the big banks and institutional lenders. Let’s borrow and spend our way to prosperity! How absurd!

 

But the public ARE NOT politically connected to big business , banking elites and BIG campaign donors so they will be allowed to fail. The amounts required to underpin the politically connected financial industry is just beginning. Crony corporate capitalists are in line right behind them, as are the states and municipalities. By the time they are through trying to SAVE the elites the bill will be far, far larger than is currently on the table and we will all pay for it. The guarantees and capital injections from G7 governments and central banks ESCALATES the insolvency. It is just moving further and further up the ladder until the financial systems as we know them disintegrate into the UNFOLDING “Crack-up Boom”. Anybody have a wheelbarrow?

 

In conclusion: Can you say morally, intellectually and fiscally BANKRUPT leaders in the G7???

Recent Bailouts announced in the U.K. remind me of ICELAND. The idea of politically-directed lending to bankrupt people, banks and businesses is OBSCENE. And how do they pay for it? By borrowing from the prudent savers (destroying the seed corn of future growth), printin the money or taxing what little is left of actually productive enterprise and individuals. It is a recipe for disaster. When this episode is complete Keynes will be the most REVILED economist in history.

 

The U.K. economy can be expected to collapse, as well as the rest of the G7, under these policies. They are compounding debt upon debt. Deflation occurs now, as rolling bankruptcies destroy what’s left of the wealth-creating private sector, which no longer has access to short-term financing as the babies are thrown out with the bathwater. The people and businesses that are being rescued don’t produce more than they consume and you can expect that to continue with government funds printed to underpin them. Then, hyperinflation occurs as basic goods and services disappear and government prints the money to pay for them when incomes collapse FURTHER.

 

There is only one solution for this and that is raising incomes from WEALTH creation, which drives wages higher and demand for goods and services. How do you do this? Cut corporate taxes to ZERO to stimulate investment, hiring and risk-taking. Remove taxes on savings and investing. New companies will lead us into a high-wage future, courtesy of REAL wealth creation and entrepreneurial boom. In a stroke of a pen the U.S. will become one of the most competitive EXPORTERS in the world.

 

Allow the insolvent banks to FAIL, pass through FDIC bankruptcy and clean their balance sheets which are opaque and unknowable. When done, transparency can be reestablished and the TOXIC waste will be GONE in the process. Then they can be bought by SAVERS and investors.

 

It will cost a fraction of what’s being proposed. The foolish investors, lenders and borrowers need to pay the price for the poor decisions they have made. Unfortunately for us all they are the biggest and best-connected political elites in the world so the public will be sacrificed as the ROADKILL. Capitalism will be blamed and destroyed as an excuse to SAVE THE WORLD. OBSCENE. Capitalism is MAIN STREET, not financial engineering in the financial and government sectors. Don’t be confused by the FOOLS in the mainstream media. It’s the private sector that created the wealth.

 

There is no shortage of capital. There is only a shortage of trust in GOVERNMENT, public servants and crony capitalists. The con men are being exposed on a DAILY basis. NO ONE will invest in a company whose condition is unknowable -- except FOOLS who do not understand how to invest. Look no further than this week’s rally in the stock markets, led by BANKS and retailers. Anybody bottom fishing in these areas deserves their fate which will be a TOTAL loss Do you hear one person in the G7 talking about how to build economies and wealth rather than print it, or borrow to inflate demand and assets? NO. Insolvency just GROWS under these policies and with it the money printing to underpin it. Wealth is created in the private sector as small businesses grow big from providing more for less and being rewarded for doing so by CONSUMERS.

 

What’s the solution for you? The indirect exchange as outlined by Von Mises. Study it, learn about it, plan and implement it. Paper is king for only a short while longer. Hold it during the collapse, identify the winners after the collapse and invest your money in them before all the other paper holders REALIZE they have been played for DUPES by monetary printing presses throughout the G7 (paper has been and will shortly again be POISON). Real businesses with real cash flow and dividends will survive ANY upheaval as the G7 leaders immolate their financial sectors and systems. You will know when to deploy by following the VELOCITY of MONEY. When it turns up you will know the rush to safety in TANGIBLE wealth has begun.

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It is despicable that Washington views the problems in terms of people not borrowing enough to FUEL the economy. Look no further than Hank Paulson’s own words last Tuesday

 

Fed economists see the economy as a machine. For them, it is simply a case of cause and effect; banks make loans then business does well and asset prices rise. In reality, the economy is more organic than that and the apparent cause and effect relation is the other way round; banks are only generous with their lending when business is first doing well and asset prices are rising.

 

Given their mechanistic model, they think of banks as carburettors which can prime or pump the economy [with liquidity] if themselves fuelled by the Central bank. I think if they persist with this insanity and push hard enough, there is a real chance the "machine" could all just blow up in their faces; from deflation to hyper overnight.

 

They are terrified of deflation. They want inflation. I wish they were more terrified of hyper-inflation [which they should be] but it looks like they will do whatever is required to avoid deflation.

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'Real businesses with real cash flow and dividends will survive ANY upheaval as the G7 leaders immolate their financial sectors and systems. You will know when to deploy by following the VELOCITY of MONEY.'

 

How is velocity of money measured? and is there a thread on Gei where the companies who are going to survive, are discussed?

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Embracing inflation

Kenneth Rogoff

Tuesday December 2 2008

http://www.guardian.co.uk/commentisfree/ci...commentposted=1

 

This once-in-a-lifetime global economic recession requires a unique response. Inflation is needed to combat the crisis

 

It is time for the world's major central banks to acknowledge that a sudden burst of moderate inflation would be extremely helpful in unwinding today's epic debt morass.

 

Yes, inflation is an unfair way of effectively writing down all non-indexed debts in the economy. Price inflation forces creditors to accept repayment in debased currency. Yes, in principle, there should be a way to fix the ills of the financial system without resorting to inflation. Unfortunately, the closer one examines the alternatives, including capital injections for banks and direct help for home mortgage holders, the clearer it becomes that inflation would be a help, not a hindrance.

 

Modern finance has succeeded in creating a default dynamic of such stupefying complexity that it defies standard approaches to debt workouts. Securitisation, structured finance and other innovations have so interwoven the financial system's various players that it is essentially impossible to restructure one financial institution at a time. System-wide solutions are needed.

 

Moderate inflation in the short run – say, 6% for two years – would not clear the books. But it would significantly ameliorate the problems, making other steps less costly and more effective.

 

True, once the inflation genie is let out of the bottle, it could take several years to put it back in. No one wants to relive the anti-inflation fights of the 1980s and 1990s. But right now, the global economy is teetering on the precipice of disaster. We already have a full-blown global recession. Unless governments get ahead of the problem, we risk a severe worldwide downturn unlike anything we have seen since the 1930s.

 

The necessary policy actions involve aggressive macroeconomic stimulus. Fiscal policy should ideally focus on tax cuts and infrastructure spending. Central banks are already cutting interest rates left and right. Policy interest rates around the world are likely to head toward zero; the United States and Japan are already there. The United Kingdom and the euro zone will eventually decide to go most of the way.

 

Steps must also be taken to recapitalise and re-regulate the financial system. Huge risks will remain as long as the financial system remains on government respirators, as is effectively the case in the US, UK, the euro zone and many other countries today.

 

Most of the world's largest banks are essentially insolvent, and depend on continuing government aid and loans to keep them afloat. Many banks have already acknowledged their open-ended losses in residential mortgages. As the recession deepens, however, bank balance sheets will be hammered further by a wave of defaults in commercial real estate, credit cards, private equity and hedge funds. As governments try to avoid outright nationalisation of banks, they will find themselves being forced to carry out second and third recapitalisations.

 

Even the extravagant bail-out of financial giant Citigroup, in which the US government has poured in $45bn of capital and backstopped losses on over $300bn in bad loans, may ultimately prove inadequate. When one looks across the landscape of remaining problems, including the multi-trillion-dollar credit default swap market, it is clear that the hole in the financial system is too big to be filled entirely by taxpayer dollars.

 

Certainly, a key part of the solution is to allow more banks to fail, ensuring that depositors are paid off in full, but not necessarily debt holders. But this route is going to be costly and painful.

 

That brings us back to the inflation option. In addition to tempering debt problems, a short burst of moderate inflation would reduce the real (inflation-adjusted) value of residential real estate, making it easier for that market to stabilise. Absent significant inflation, nominal house prices probably need to fall another 15% in the US, and more in Spain, the UK and many other countries. If inflation rises, nominal house prices don't need to fall as much.

 

Of course, given the ongoing recession, it may not be so easy for central banks to achieve any inflation at all right now. Indeed, it seems like avoiding sustained deflation, or falling prices, is all they can manage.

 

Fortunately, creating inflation is not rocket science. All central banks need to do is to keep printing money to buy up government debt. The main risk is that inflation could overshoot, landing at 20% or 30% instead of 5-6%. Indeed, fear of overshooting paralysed the Bank of Japan for a decade. But this problem is easily negotiated. With good communication policy, inflation expectations can be contained, and inflation can be brought down as quickly as necessary.

 

It will take every tool in the box to fix today's once-in-a-century financial crisis. Fear of inflation, when viewed in the context of a possible global depression, is like worrying about getting the measles when one is in danger of getting the plague.

 

In cooperation with Project Syndicate, 2008.

 

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U.S. Fed Monetizing Debt by Printing Money - by Axel_Merk: http://www.marketoracle.co.uk/Article7578.html

 

...A substantially weaker dollar may cause price levels to rise; as a result, the dollar may be a better indicator of inflationary pressures to come than the yield curve that is distorted because of the various Fed programs. Fed Chairman Bernanke may want to have a weak dollar and inflation, but may ultimately be getting more than he is bargaining for.

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A substantially weaker dollar may cause price levels to rise; as a result, the dollar may be a better indicator of inflationary pressures to come than the yield curve that is distorted because of the various Fed programs. Fed Chairman Bernanke may want to have a weak dollar and inflation, but may ultimately be getting more than he is bargaining for.

 

Printed money remains locked up in banks. Even if the banks were all nationalized and the government went on a lending spree, the population is too bloated on debt to consume any more.

 

Perhaps the only way out for the government, in desperate need to inflate, is to formally devalue the dollar... this could be the "currency event" that Jim Sinclair has mentioned recently and the "dollar devaluation" that JP is starting to talk about.

 

Forget economic theory, we could be heading into what it always was... political economy.

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Printed money remains locked up in banks. Even if the banks were all nationalized and the government went on a lending spree, the population is too bloated on debt to consume any more.

What if the government went on a spending spree. I think that is more likely.

 

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What if the government went on a spending spree. I think that is more likely.

Like bailouts to all mortgage owners? Yeah, I think that is coming next.

 

But don't you think that by this stage the economy is starting to look like something of a "command" economy? And what stops the governments, if desperate enough, from formally inflating by decree by devaluing the currency overnight. This would have the inflationary and instant effect of doubling all prices and resoring the debt/asset ratio at the stroke of a pen. Would solve all their problems. I believe FDP did something similiar in '34. Economic theory could morph back to political economy.

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And what stops the governments, if desperate enough, from formally inflating by decree by devaluing the currency overnight. This would have the inflationary and instant effect of doubling all prices and resoring the debt/asset ratio at the stroke of a pen.

 

What mechanism do they use to achieve that?

 

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What mechanism do they use to achieve that?

Good question. But the situation could very quickly go beyond "free market" economics to some political solution. Maybe it would be something similiar to FDRs formal devaluation of the dollar by 40% in 1934. I think this is the logical way out when their attempt to reflate through the free market fails. Dollar devaluation by 50% doubles the prices of everything [including wages, the price of labour]. Debt and savings numbers remain the same restoring the required debt/asset ratio.

 

The banks/creditors will be bankrupted, but they will be most probably govt owned by then [already underway].

Creditor nations will be happy to have a return of half rather than a complete default.

Savers/pensioners will be shafted.

 

Bye bye free markets and hello price-fixing [which was essentially what they have been trying to do all along with reflation].

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Good question. But the situation could very quickly go beyond "free market" economics to some political solution. Maybe it would be something similiar to FDRs formal devaluation of the dollar by 40% in 1934. I think this is the logical way out when their attempt to reflate through the free market fails. Dollar devaluation by 50% doubles the prices of everything [including wages, the price of labour]. Debt and savings numbers remain the same restoring the required debt/asset ratio.

 

The banks/creditors will be bankrupted, but they will be most probably govt owned by then [already underway].

Creditor nations will be happy to have a return of half rather than a complete default.

Savers/pensioners will be shafted.

 

Bye bye free markets and hello price-fixing [which was essentially what they have been trying to do all along with reflation].

 

RH - You have hit the nail on the head! Just a matter of time until it is done...

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RH - You have hit the nail on the head! Just a matter of time until it is done...

Thanks for the vote of confidence. :)

 

I noticed the heavyweights of Jim Sinclair and James Puplava are now focusing on this route to [hyper] inflation. Jim Sinclair recently emphasized a currency event and JP started to talk of dollar devaluation.

 

It is the only way out now that deflation has a death grip on the economy.

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Now this is an interesting discussion.

 

So if the UK govt devalued the £ by 50% what would happen to:

 

House prices?

Gold?

 

Presumably, house prices would stay the same (as they are measured in pounds and are bought and sold within the UK) but gold would double (showing that it is a currency). However, I am happy to be enlightened (or even disappointed).

 

I'm just knocking up a spreadsheet which charts what % of gold I need to have to ensure that whatever percentage the £ is devalued by, I don't lose too much.

 

 

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Now this is an interesting discussion.

 

So if the UK govt devalued the £ by 50% what would happen to:

 

House prices?

Gold?

 

Presumably, house prices would stay the same (as they are measured in pounds and are bought and sold within the UK) but gold would double (showing that it is a currency). However, I am happy to be enlightened (or even disappointed).

 

I'm just knocking up a spreadsheet which charts what % of gold I need to have to ensure that whatever percentage the £ is devalued by, I don't lose too much.

All asset prices would double if the pound was formally devalued by half. It would be an inflation by other means. Gold also would double in price. These prices are inflated nominal prices from the perspective of present pounds. The rationale for devaluation is that the debt numbers [debt, and also savings for that matter, are not prices] remain the same. Public and private debt would therefore become servicable and the bulk of the population would happily accept the move considering that most are in debt and their wages [the price of labour] are doubled. Of course, the politicians would prefer for a conventional "free market" inflation [reflation] but that may not happen.

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All asset prices would double if the pound was formally devalued by half. It would be an inflation by other means. Gold also would double in price. These prices are inflated nominal prices from the perspective of present pounds. The rationale for devaluation is that the debt numbers [debt, and also savings for that matter, are not prices] remain the same. Public and private debt would therefore become servicable and the bulk of the population would happily accept the move considering that most are in debt and their wages [the price of labour] are doubled. Of course, the politicians would prefer for a conventional "free market" inflation [reflation] but that may not happen.

 

Is that really true though? Have house prices and wages in Iceland increased as a result of the Krone's devaluation?

 

It is important in my mind to distinguish between inflation caused by money supply and credit expansion and currency devaluation?

 

I would have thought domestic assets within an economy merely remain the same price in nominal terms when a currency is devalued, whereas assets which have foreign assets or hard assets would be nominally valued higher. Otherwise what is the point of the devaluation?

 

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All asset prices would double if the pound was formally devalued by half. It would be an inflation by other means. Gold also would double in price. These prices are inflated nominal prices from the perspective of present pounds. The rationale for devaluation is that the debt numbers [debt, and also savings for that matter, are not prices] remain the same. Public and private debt would therefore become servicable and the bulk of the population would happily accept the move considering that most are in debt and their wages [the price of labour] are doubled. Of course, the politicians would prefer for a conventional "free market" inflation [reflation] but that may not happen.

 

The price of labour is not going to double without imposing import restrictions or tariffs. In fact, the opposite is going to happen in the UK leading to a lowered standard of living for everyone. The UK is a service based economy - the services are the delivery and consumption of DEBT.

 

The price of everything imported is going to skyrocket while domestically produced stuff (without imported components) is going to plummit - especially stuff bought by DEBT.

 

Its an Icelandic renaissance for the UK.

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Is that really true though? Have house prices and wages in Iceland increased as a result of the Krone's devaluation?

 

It is important in my mind to distinguish between inflation caused by money supply and credit expansion and currency devaluation?

 

I would have thought domestic assets within an economy merely remain the same price in nominal terms when a currency is devalued, whereas assets which have foreign assets or hard assets would be nominally valued higher. Otherwise what is the point of the devaluation?

Good points. You could also say that the massive depreciation of the pound has also not affected asset prices in Britain. But I am thinking of something entirely different to this kind of depreciation. I guess a distinction needs to be drawn here between depreciation and "devaluation".

 

Depreciation is what we are seeing now with many currencies in relation to stronger currencies such as the dollar and Yen. It is something happening in the free market and does not lead automatically to higher prices within the country affected, though it would as you say have an effect in the international markets. The kind of depreciation we are seeing today in the free market does not lead to higher asset prices though it may well lead to higher commodity and goods prices.

 

In contrast, "devaluation" would refer to a formal political act where the currency is suddenly devalued by say half which could in turn lead straight to a re-pricing or price fixing of all prices including assets. The precedent for this would be the devaluation of the dollar by Roosevelt. I would like to read more on this and see what the effect on prices was. It would of course entail the end of the free market and the beginning of a command economy. This kind of "devaluation" could lead to the desired inflationary outcome in all prices. How could it happen? By fiat and political will.

 

The point of a formal devaluation is to inflate all prices and restore the required debt/asset ratio.

 

 

Edit: if the US dollar is devalued [perhaps after a year or so of deflationary misery] then you would see the pound [if it had survived] and other co-dependent currencies follow suit.

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Has cgnao got a job at the telegraph or are the mainstream media just catching up with GEI?

 

Bank has little option but to ready the printing presses. "quantitative easing" - printing money, getting it into peoples' hands and ensuring that they go out and spend it."The US government has a technology, called a printing press." It may soon prove the time to use it, on both sides of the Atlantic.

 

http://www.telegraph.co.uk/finance/economi...ng-presses.html

 

 

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The price of labour is not going to double without imposing import restrictions or tariffs. In fact, the opposite is going to happen in the UK leading to a lowered standard of living for everyone. The UK is a service based economy - the services are the delivery and consumption of DEBT.

 

The price of everything imported is going to skyrocket while domestically produced stuff (without imported components) is going to plummit - especially stuff bought by DEBT.

 

Its an Icelandic renaissance for the UK.

Yes.. but even if all prices including wages are doubled in my imaginary fiat devaluation... those prices would retain the same value. It is not a real doubling of prices but a nominal doubling of prices. In the strange mathematical universe of the bankers/fiat money it is the numbers that are significant not the substance or reality.

 

Of course the price of everything imported would also naturally double [as they will be re-priced in a devalued currency] and could in real terms become more expensive as the standard of living in the west declines.

 

With wages doubled in nominal terms the cost of living could still become exorbitant but the service of debt would become manageable [debt, like savings, is not a price and will be effectively halved in real terms as the nominal numbers remain the same].

 

A formal devaluation and re-pricing would have the same effect as a five year inflation averaging 20% per year.... though it could be compressed into one day.

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