---------------------------- Original Message ----------------------------
Subject:
Armstrong's numerous errorsDate: Fri, April 10, 2015 12:51 pm
To: "Armstrong Economics" <
armstrongeconomics@gmail.com>
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http://armstrongeconomics.com/2015/04/10/feds-ability-to-create-money-from-thin-air/Consequently, QE1-3 failed to produce inflation because ... the increase in money supply was not confined to the domestic economy.
...
However, that will flip the other way for interest expenditures will exceed defense by 2020 and with a uptick in interest rates, then you will see STAG-inflation.
 | Inserted "STAG-" to correct Armstrong's thought error or typo.
Actually it will be much worse than stalled economy and we need a new term such as IMPLOSION-FLATION.
It is going to be a site to behold on Marxist (Mr. Georgia Guidestones) Teddy Turner's CNN. My popcorn reserve is stacked.
Btw, the reason the inflation will finally come domestic is several fold (and Armstrong didn't articulate this correctly):
1. Higher taxes will be required to fund the interest payments and businesses pass these costs along as higher prices.
2. The higher interest payments mean more of the national debt will be paid into the domestic economy.
3. When the Fed was buying 30 years Treasuries, the lower interest rates enabled a carry trade borrowing dollars and lending into foreign economies with higher interest rates. This is why most of the QE ended up overseas. When the interest rates reverse direction, so will the carry trade, which will send massive flow of capital into the USA driving inflation. But this will also make a strong dollar, which will choke off the real (such as export) economy.
QE did create inflation abroad, but this was absorbed as an acceptable rate of annual inflation, because there was such incredible untapped productivity increases in the developing world. The powers-that-be had retarded the developing world for decades. It did create a massive dollar-short position for the rest of the world, which is going to collapse the rest of the world as the USA starts raising interest rates. |
Is Armstrong predicting a rise in the dollar and gold simultaneously?
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