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Debasing the Dollar

Wednesday, March 12, 2008

It's time once again to put on my tinfoil hat and make an observation about our failing economy. This is just an observation, so do with this as you please. Here goes...
At the end of the Clinton era, Bush took office and the economy to be in pretty good shape. After the terrorist attacks, however, things took a huge nosedive in part because the stock exchange was closed and the airline industry came to a screeching halt, not to mention rampant fear and paranoia fueled by our own creation: the color-coded fear-o-meter. Then our fearless leaders drug this country into a war with their most recent whipping boy, Saddam Hussein, and Iraq. That war has now lasted longer than World War II. And we've paid for that war mostly by borrowing money. Lots of money.
Now, what happens to a fiat currency when you borrow more and more money into existence? Anyone, anyone? That's right: inflation. And, boy, do we have inflation. Oh, if you ask the fed, they'll deny it. But, isn't it convenient that where the effects of inflation felt the most are those areas the fed doesn't look at when calculating its inflation figures? You know, like fuel and housing. How convenient, indeed! The price of both has doubled (or more) since 2000.
Anyway, I was going somewhere with this. Oh, yes, I remember. The Amero. There are those among us who believe the U.S., Canadian, and Mexican governments are working behind the scenes and without the consent of the governed to impress upon their citizens a new universal currency for the North American continent: the Amero. But, the problem with this plan is that the three countries, with their three unique currencies, are not on par. Or, at least they weren't in 2000. Now, we see that Canada and the U.S. or almost spot on. I wonder where Mexico is in relation to the other two?
So, how do you get several currencies all to equal out? One way, I imagine, would be to over-inflate the stronger currencies, driving their values closer to the weaker ones. But how? Oh, I know... Start a war that will be paid for by borrowing billions of dollars a day. See, I told you that you were going to need to dawn your tinfoil hat. But, then again... I'm not the only one who has noticed the almost deliberate devaluation of the dollar:
As I said this past November to Federal Reserve Chairman Ben Bernanke, "We're indeed between a rock and a hard place, and we don't talk about how we got here; we talk about how we are going to patch it up." The "solutions" proposed so far--stimulus packages, bailouts and interest rate cuts--just amount to printing more money, which will lead to greater currency devaluation, contribute to the rising costs of living, and further squeeze the middle class and our senior citizens. (Emphasis added)
~Dr. Ron Paul, Forbes Magazine (Source)
What better way to debase a nations currency than perpetual war with an invisible enemy? I've not researched the historical movements of individual currencies against each other. Like I said at the beginning, it was just an observation. There may be nothing to it at all.


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