Today the US Treasury announced its funding requirements for the last three months of 2008. As anyone could imagine, the need for additional borrowing is astronomical. That target is $550 Billion. The borrowing in the third quarter was $530 Billion. The national debt is ballooning.
Tragically, the Federal Reserve has been the source of much of the funding so far, and is expected to be a major source of funds moving forward. There is one problem with this. The Fed is broke. Busted. Bankrupt. It is lending money to the banking system at a rate of over half a trillion dollars a week now. Its resources have long been exhausted, and it is now resorting to unchecked monetary creation to fund any and all future packages, bailouts, and/or stimulus packages.
This is a death sentence for the Dollar. This Dollar rally has been caused not by fundamentals, but by a squeeze due to the liquidation of global assets. There are no fundamentals for the Dollar. It will soon be created in Weimar fashion to keep up with the evaporation of wealth in the US and abroad. Our 5 point strategy from 2006 has been, is, and will continue to be a sound way to protect your wealth from the hyperinflation that now lies dead ahead.
See our 5 point strategy here
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