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In relation to the inflation/deflation debate, Jimmy says, "To begin with, falling asset prices does not constitute deflation. One of the primary objectives of the banking elite in firm control of the USGovt and USCongress is to confuse the public and investment community on the entire topic of inflation, what it is, how it is measured, and its risks. The same goes for deflation. All debate as to whether the Untied States will suffer from inflation or deflation is a horrible misdirected distraction that manifests the confusion. The US will suffer both higher monetary inflation and worse economic deterioration, not one or the other, but BOTH, and with steadily increasing intensity. Imagine a massive tornado building force, inflicting damage, and being fed to grow even more powerful by current policy. To argue on whether the high pressure or low pressure will prevail misses the entire storm, built upon the grand and growing differential in pressure. The storm is born of opposing pressures, each growing more intense. Human response to economic distress and banking woes ensure evermore pressures to be exerted on each side. The grand growing monetary expansion continues to collide with grand worsening asset price decline, while the Deflation Knuckleheads spout more nonsense. They miss the storm itself, how it is formed, and the dual nature of its tempest.

A very important point must be made, something few if any analysts or pundits or anchors are mentioning. In fact, the staggering direction of monetary aid for rescues of dead banks, for nationalization of dead corporations, and for stimulus to an insolvent nation guarantee more damage. The huge monetary growth guarantees that the asset prices will continue to fall, and that the great tempest will grow in magnitude and danger. Why? Because bad money drives out good money, because phony money undermines legitimate assets, because easy money encourages more bubbles. It acts like a cancer, one that has essentially destroyed the fundamental foundation of the nation. This extremely important point will lead to the ultimate downfall of the Untied States, as their inflation will destroy too much capital in determined yet mindless application.

The primary question that the errant Deflationists avoid is “Why is the Crude Oil price rising?” since it highlights their erroneous position and twisted viewpoint. The strong uptrend in crude oil price stands as contradiction to their argument, but they ignore it. The hidden question that they cannot even manage to formulate is “Is the Shadow Banking System flow data included in the Money Velocity figure?” as some within their camp appear to trust USFed data itself. The other bank system has kept the entire credit market afloat for over a decade, without benefit of statistical inclusion. Never permit a syndicate to supply critical data. To dismiss official price inflation data but trust their money velocity data is folly. In my travels, when my confrontational questions are posed, they are almost never answered. The posed questions are as little understood as the emotion is great behind their incorrect views. The Deflationists will be correct only if the Central Banks and their franchise system of destruction shut down and halt the accelerated production of phony money. Aint happenin!

What is particularly disturbing is how intelligent aware members of the gold community of sound money principles find themselves ensnared within the lexicon of the Deflationist camp. They show confusion by simply engaging in discussions, as they use the crippled terms. For instance, a bright colleague from inside the gold community recently said in an exchange “Deflation will make the inflation worse” which is nonsense on its face. He meant to say “Falling asset prices will force even more monetary inflation in response in the form of rescue or stimulus.” Another from outside the gold community said “Deflation suffered by the banks from housing will push down the gold price” which is again a comment within a pretzel. He meant to say “The housing pressure on bank balance sheets will lead to falling asset prices generally, and thus harm the gold price” which is utter nonsense. It is actually difficult to debate the topic, since most people are hampered by the faulty lexicon adopted. To clarify most clouds of confusion, it is best to refer to ‘Falling Asset Prices’ instead of ‘Deflation’ in almost all cases. The bankers must be laughing hard in their snifter glasses at the bewilderment laced throughout the public, as 90% have no idea what inflation and deflation are, let alone where they come from, and surely not how neither could possibly prevail in today’s environment. Meanwhile, the great storm continues, with only minimal recognition, since the growing amplitude in the differential rules the day. The monetary aggregate is growing, just as the asset value destruction continues. Each has its hidden components, to further add to the confusion.

More info than most can absorb in one sitting. The "dumbing down" has been working long and hard affecting, IMHO, about 99% of the General Public as the late great Jesse Helms always refered to them!

If you've been "smitten," good luck! If not, good luck!

You want to be upstream from that herd! Not surprisingly that's where you'll find gold, gold equities and their immediate relatives! Plus a few committed gold affectiendos!

RUF

RUF