Six Reasons Why The Government Is Destroying The Dollar
The United States government has six interrelated motivations for destroying the value of the dollar:
1. Creating money out of thin air on a massive basis is all that stands between the current state of hidden depression, and overt depression with unemployment levels potentially rivaling those seen in the Great Depression of the 1930s.
2. It is the most effective way to not just pay down current crushing debt levels using devalued dollars, but also to deal with the rapidly approaching massive generational crisis of paying for Boomer retirement promises.
3. It creates a lucratively profitable $500 billion a year hidden tax for the benefit of the US government – a tax which is not understood by voters or debated in elections.
4. It creates a second and quite different form of hidden taxation by way of generating artificial market highs, which while non-existent in inflation-adjusted terms, do create artificial investment profits that are fully taxable and highly profitable for the US government.
5. It is the weapon of choice being used to wage currency war and reboot US economic growth; and
6. It is an essential component of political survival and enhanced power for incumbent politicians.
In this article we take a holistic approach to understanding how individual short, medium and long-term pressures all come together to leave the government with effectively no choice but to create a significant rate of inflation that will steadily destroy the value of the dollar over time.
"Unlimited QE3" Quick Analysis: Federal Reserve Attacks US Dollar, Risks Currency Warfare
The Federal Reserve is indeed using QE3 to attack the problem of unemployment - but not through the method stated.
The cover story is that QE3 will be used to increase the money available for lending and to lower interest rates. It is a credit to Mr. Bernanke that he was able to read this statement with a straight face, for the assertion that the economy is being held down by too high of interest rates and tight money is ludicrous. Interest rates are already at historic lows, and banks are awash in available cash. Moreover, QE3 is likely to have very little effect when it comes to expanding corporate lending, just as QE2 had very little effect - because that was never the intended route to rebooting employment in the United States.
As described in detail in my article "Bullets In The Back: How Boomers & Retirees Will Become Bailout, Stimulus & Currency War Casualties" (linked below) the United States has a structural problem with unemployment that is essentially unsolvable so long as the dollar remains high in value relative to other global currencies.
http://danielamerman.com/articles/Bullets.htm
The Federal Reserve is, of course, well aware that the unemployment situation is far, far worse than what is being captured in the official headline unemployment rate of 8.1%. The government knows full well that the true unemployment rate, once workforce participation rate manipulations are netted out, is closer to 19% - and getting worse, as explored in detail in my article linked below, "Making 9 Million Jobless "Vanish": How The Government Manipulates Unemployment Statistics".
http://danielamerman.com/articles/2012/WorkC.html
This building crisis of a strengthening dollar and rising unemployment called for emergency action, and that is exactly what Bernanke is doing. He is effectively calling in a B-52 strike on the US dollar, monetizing for the world to see, and pledging to monetize for as long as it takes - until the US dollar is driven down to a level where American workers can once again be globally competitive.
