That’s it! I’ve had enough. Today’s date is June 10, 2008, apparently the day of the reemergence of ‘King Dollar’, as Larry Kudlow calls it. (Side Note on Larry Kudlow: I had the displeasure of hearing him speak first hand at the New York Hard Assets show. A real mental midget compared to those speaking that weekend, and pompous to boot. A quote out of the Adam Sandler flick, “Billy Madison” comes to mind, and I paraphrase, “Thank you [Larry], I think it is safe to say that we are all a little dumber (purposefully grammatically incorrect), for having heard you speak”.) All of this king dollar talk is as a result of three speeches given by Bernanke in less than one week. That’s right Bernanke is acknowledging upward pressures on the inflation front. He has yet, however, to acknowledge any REAL inflation, as the Fed would define it, and more importantly, the Fed has yet to do anything to fight inflation. Please, don’t rely upon the mainstream media to interpret Federal Reserve speak for you. Do your own due diligence!!! Each speech given by a Fed Governor is published in it’s entirety on the Federal Reserve website. Yes, Bernanke has made it clear that inflation is on the Fed radar, (which is probably the same radar that was used to predict the fallout from the sub-prime mess), however each speech traversed through a similar preface prior to tackling the topic of inflation. Bernanke, in his most recent address to the Fed Reserve Bank of Boston given yesterday stated, “…the ongoing contraction in the housing market and continuing increases in energy prices suggest that growth risks remain to the downside. One of the most effective means by which the Federal Reserve can help to restore moderate growth over time and to reduce the associated downside risks is by supporting the return of the financial markets to more-normal functioning. We have taken a number of actions to promote financial stability and remain strongly committed to that objective.” These are the words that prefaced his foray into strong dollar talk. It’s not a cipher. You don’t have to have some secret decoder ring to figure it out. You just have to READ!!!! (Translation: Before I discuss inflation, let me make it clear, the housing downturn is kicking our collective arse and if I do not maintain low interest rates and pump liquidity into the financial system, we may fall off the precipice over which we precariously dangle.) Couple this with words from his speech to the students and faculty of Harvard. He acknowledged, and I paraphrase, that aside from sustaining growth, the Federal Reserve has a dual mandate to maintain stable prices. He then basically stated that the Federal Reserve is not mandated to maintain LOW prices, just STABLE prices. He then gave a short dissertation on how high, but stable, prices are good for the economy. High prices encourage ingenuity, a sharper focus on better efficiency, etc., etc., etc. Don’t take it from me, read the speeches yourself!! (Get this, as I am writing this, an NPR reporter just whittled down all three of Bernanke’s speeches, (which total about 15 pages of reading), to, “Federal Reserve chairman acknowledges inflation and downplays rise in unemployment.” Yep, that was not just a story header, but the whole story. Woohoo!!!! King Dollar is finally here Larry, you dope!!!!) Will the Fed raise rates? They may, for fear of becoming, ‘the boy who cried wolf’. If they do at all, it won’t be by any amount that matters….maybe by ¼ percent. I personally believe they will become, ‘the boy who cried wolf’, reduced only to meaningless rhetoric. They are handcuffed by their dual mandate. Current market conditions pit the mandates against one another. They can’t drop the rate to zero or negative to bail out the housing mess because of the weak dollar/inflation. They can’t raise rates and vacuum up liquidity to strengthen the dollar for fear of a collapse of the financial system. People need to wake up. Bottom line … the imposter King Dollar will be laid low at the feet of the rightful heirs to the throne, Gold and Silver.

In closing, consider this, in a week’s time, IN A WEEK’S TIME, analysts predicted a $300 million dollar loss for Lehman Bros., Lehman Bros., reported a $2.8 billion loss and that they were going to attempt to raise $4 billion, nope $5 billion, nope $6 billion. The actual loss was ONLY 9 ½ times greater than analyst estimates. One analyst reported that he felt this was a good thing as they (Lehman Bros.) are getting all of the bad news out on the table at once. Yep, that’s it, trust the banks and go long Lehman, you knucklehead!!