Yesterday the Federal Reserve completed the latest meeting of its Federal Open Market Committee. It re-affirmed its plan to purchase by the end of the year some $1.8 trillion – yes, $1.8 trillion – of US government paper, comprising of agency debt, agency mortgage-backed securities and US Treasuries. That’s nearly $6,000 for every man, woman and child in the United States.
While $1.8 trillion is a gargantuan amount of money, the actual amount is of secondary importance to the essential, piercing question. Namely, where is this $1.8 trillion going to come from?
The answer is not pretty. These dollars will come from the same place that all other dollars are created these days, namely, out of thin air. Here’s how Mr. Bernanke explained this monetary sleight-of-hand before he was appointed as chairman of the Federal Reserve. “The U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost.”
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It has become increasingly apparent that the US dollar has caught the fiat currency disease, where too many units of account are created. This disease is fatal, and hundreds of fiat currencies buried in the fiat currency graveyard throughout history have succumbed to it.
By creating too many units of account out of thin air, the Federal Reserve has sealed the dollar’s inflationary fate. Own gold and/or silver to protect yourself and your family from this inevitable outcome.
by James Turk
Complete article from Kitco
http://www.kitco.com/ind/turk/turk.html
