{"id":65160,"date":"2014-12-12T11:40:44","date_gmt":"2014-12-12T16:40:44","guid":{"rendered":"http:\/\/countingpips.com\/?p=65160"},"modified":"2014-12-12T11:40:44","modified_gmt":"2014-12-12T16:40:44","slug":"run-away-from-the-economic-tsunami","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2014\/12\/run-away-from-the-economic-tsunami\/","title":{"rendered":"Run Away from the Economic Tsunami"},"content":{"rendered":"<div id=\"inves-2922483450\" class=\"inves-below-title-posts inves-entity-placement\"><div id =\"posts_date_custom\"><div align=\"left\">December 12, 2014<\/div><hr style=\"border: none; border-bottom: 3px solid black;\">\r\n<\/div><\/div><h4>By Dennis Miller<\/h4>\n<p>This warning comes from \u201cBig Al\u201d Greenspan, age 88. He\u2019s been in the news a lot lately, speaking with Gillian Tett of the <em>Financial Times<\/em> at the Council on Foreign Relations and at the New Orleans Investment Conference. After reading several reports of both events, I spoke with Casey Research colleagues who\u2019d attended the conference and asked, \u201cDid Big Al really say this, this, and this?\u201d<iframe loading=\"lazy\" src=\"http:\/\/trk.caseyresearch.com\/f\/?content_id=1103&amp;code=PIP&amp;editorial=run-away-from-the-economic-tsunami\" width=\"1\" height=\"1\" frameborder=\"0\"><\/iframe><\/p>\n<p>Their response was crystal clear: \u201cYep! That\u2019s exactly how I saw it and what I took his remarks to mean.\u201d<\/p>\n<p>Mr. Greenspan is issuing a warning to anyone who will listen, \u2018fessing up to things many of us thought might be true. His candor reinforces many of my worst fears:<\/p>\n<ul style=\"margin-bottom: 2px;\">\n<li style=\"margin-bottom: 2px; margin-left: 36px; margin-right: 0px; text-align: left; text-decoration: none;\">The Federal Reserve is raining money down from the heavens to fund unprecedented government spending and to keep the banking system solvent.<\/li>\n<li style=\"margin-bottom: 2px; margin-left: 36px; margin-right: 0px; text-align: left; text-decoration: none;\">The credit needs of the US government are so huge that if the Fed didn\u2019t add liquidity to the system, the private sector would be choked out, unable to afford to borrow money.<\/li>\n<li style=\"margin-bottom: 2px; margin-left: 36px; margin-right: 0px; text-align: left; text-decoration: none;\">An inflationary bonfire is just a spark away. Big Al likened the money supply to kindling awaiting a match to ignite an inflationary explosion.<\/li>\n<\/ul>\n<h3><strong>The Fed\u2019s Real Job<\/strong><\/h3>\n<p>Greenspan made it clear that the Fed\u2019s mission is to help fund US government spending and to defend the banking system. In his talk at the Council on Foreign Relations, he also mentioned coordinating with other central bankers throughout the world.<\/p>\n<p>In essence, the Federal Reserve functions as a low-interest Visa card with no spending limit. The Fed enables a spendaholic government, dealing it trillions of doses of its drug of choice.<\/p>\n<p>Frankly, Janet Yellen inherited a mess. When she talks about the Fed\u2019s role in combating inflation and promoting unemployment, it\u2019s window dressing. When push comes to shove, the needs of the US government and big banks take priority. As long as government spending continues, the Fed will continue to feed the beast with cheap money\u2014just like Big Al says.<\/p><div id=\"inves-2079720707\" class=\"inves-in-content inves-entity-placement\"><hr style=\"border: 1px solid #ddd;\">\r\n<div id=\"inpost_ads_header\">\r\n<p style=\"font-size:10px; float:left; color:#666;\">Free Reports:<\/p><\/div>\r\n<div id=\"inpost_ads\"> \r\n<p style=\"font-size:15px; float:left;\"><a href=\"https:\/\/goo.gl\/1ApBOV\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/investmacro.com\/wp-content\/uploads\/2018\/06\/graph_techs_PD.png\" align=\"left\" width=\"80\"  height=\"55\"\/><\/a>\r\n\t     <a href=\"https:\/\/goo.gl\/1ApBOV\"><b><u>Get Our Free Metatrader 4 Indicators<\/u><\/b><\/a> - Put Our Free MetaTrader 4 Custom Indicators on your charts when you join our Weekly Newsletter<\/p><br><br>\r\n<br>\r\n<br>\r\n<p style=\"font-size:15px; float:left;\"><a href=\"https:\/\/goo.gl\/f3RrHX\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/investmacro.com\/wp-content\/uploads\/2019\/01\/cot_pie_80.png\" align=\"left\" width=\"80\"  height=\"55\"\/><\/a>\r\n\t    <a href=\"https:\/\/goo.gl\/f3RrHX\"><b><u>Get our Weekly Commitment of Traders Reports<\/u><\/b><\/a> - See where the biggest traders (Hedge Funds and Commercial Hedgers) are positioned in the futures markets on a weekly basis.<\/p><br><br>\r\n<\/div>\r\n<hr style=\"border: 1px solid #ddd;\">\r\n<br><\/div>\n<h3><strong>On Government Debt<\/strong><\/h3>\n<p>While US government debt is reportedly in the $17-trillion range, that\u2019s a drop in the bucket compared to its real liabilities. On top of Social Security obligations and unfunded pension promises, Big Al also reminds us that no one knows what the Fed\u2019s true liabilities are because it has essentially guaranteed the liabilities of too-big-to-fail entities.<\/p>\n<p>All this means that the US government cannot satisfy its debts without inflating the US dollar at a much greater rate than most of us could imagine.<\/p>\n<h3><strong>He Who Has the Gold<\/strong><\/h3>\n<p>Unlike Ben Bernanke, who\u2019s likened gold to an ancient relic, Big Al sees things differently, stating: \u201cGold is a currency. It is still, by all evidence, a premier currency. No fiat currency, including the dollar, can match it.\u201d Greenspan went on to discuss tapering and agreements with central banks, confirming that gold serves a very important role in monetary reserves.<\/p>\n<p>All this reminds me of the <em>other <\/em>golden rule: \u201cHe who has the gold makes the rules.\u201d Russia and China must believe that, given their buying habits over the last few years.<\/p>\n<h3><strong>Warning Recap<\/strong><\/h3>\n<p>Let\u2019s review Big Al\u2019s warning. The Federal Reserve\u2019s primary mission is to support out-of-control government spending. To do so it\u2019s \u201ccreated\u201d trillions of dollars. Regardless of who is in office, politicians can\u2019t help themselves. Spending will continue. If the Fed tries to reverse the trend, there will be a significant market event. If it keeps doing what it\u2019s doing, significant inflation is inevitable.<\/p>\n<p>A lot of people will be hurt. Seniors and savers, particularly those holding the majority of their wealth in US dollars, are standing on the seashore so they can get a better view of the tsunami. There is a better way.<\/p>\n<p>The day will come when the inevitable becomes imminent. I fear for those who ignore or refuse to accept the warning. Anyone who holds gold and\/or other inflation hedges likely isn\u2019t shocked by what Big Al is saying. For everyone else, don\u2019t ignore Greenspan\u2019s warnings\u2014they are crystal clear.<\/p>\n<p>If you\u2019re one of the seniors or savers who\u2019s standing at the shoreline, watching the tsunami come in but unsure of where to run, we can show you a path to safety. Every Thursday my team and I share timely, no-nonsense financial strategies for risk-adverse investors in our free weekly e-letter, <em>Miller\u2019s Money Weekly<\/em>. <a href=\"http:\/\/www.millersmoney.com\/go\/uer3x-2\/PIP\" target=\"_blank\">Sign up here to start receiving your free copy now.<\/a><\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<div id=\"xvMdV95u77zU\" style=\"clear: both;\">The article <a href=\"http:\/\/www.millersmoney.com\/go\/uer6y-2\/PIP\" rel=\"permalink\">Run Away from the Economic Tsunami<\/a> was originally published at <a href=\"http:\/\/www.millersmoney.com\/go\/uer9z-2\/PIP\">millersmoney.com<\/a>.<\/div>\n<div style=\"clear: both;\"><\/div>\n<div style=\"clear: both;\"><\/div>\n<div style=\"clear: both;\"><\/div>\n<div style=\"clear: both;\"><\/div>\n<div style=\"clear: both;\"><\/div>\n<div style=\"clear: both;\"><\/div>\n<div style=\"clear: both;\"><\/div>\n<div style=\"clear: both;\"><\/div>\n","protected":false},"excerpt":{"rendered":"<p>By Dennis Miller This warning comes from \u201cBig Al\u201d Greenspan, age 88. He\u2019s been in the news a lot lately, speaking with Gillian Tett of the Financial Times at the Council on Foreign Relations and at the New Orleans Investment Conference. After reading several reports of both events, I spoke with Casey Research colleagues who\u2019d [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-65160","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/65160","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=65160"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/65160\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=65160"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=65160"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=65160"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}