Guess What Happened The Last Time The U.S. Dollar Skyrocketed In Value Like This?

Michael Snyder

Over the past decade, there has been only one other time when the value of the U.S. dollar has increased by so much in such a short period of time.  That was in mid-2008 – just before the greatest financial crash since the Great Depression.

A surging U.S. dollar also greatly contributed to the Latin American debt crisis of the early 1980s and the Asian financial crisis of 1997.  Today, the globe is more interconnected than ever.  Most global trade is conducted in U.S. dollars, and much of the borrowing done by emerging markets all over the planet is denominated in U.S. dollars.  When the U.S. dollar goes up dramatically, this can put a tremendous amount of financial stress on economies all around the world.  It also has the potential to greatly threaten the stability of the 65 trillion dollars in derivatives that are directly tied to the value of the U.S. dollar.

The global financial system is more vulnerable to currency movements than ever before, and history tells us that when the U.S. dollar soars the global economy tends to experience a contraction.  So the fact that the U.S. dollar has been skyrocketing lately is a very, very bad sign.

Russia and China planning to dump the US dollar

The Russian and Chinese central banks have agreed a draft currency swap agreement, which will allow them to increase trade in domestic currencies and cut the dependence on the US dollar in bilateral payments.

“The draft document between the Central Bank of Russia and the People’s Bank of China on national currency swaps has been agreed by the parties,” and is at the stage of formal approval procedures, ITAR-TASS quotes the Russian regulator’s office on Thursday.

The Russian Central Bank is not giving precise details on the size of the currency swaps, nor when it will be launched. It says this will depend on demand.

According to the bank, the agreement will serve as an additional instrument for ensuring international financial stability. Also, it will offer the possibility to obtain liquidity in critical situations.

“The agreement will stimulate further development of direct trade in yuan and rubles on the domestic foreign exchange markets of Russia and China,” the Russian regulator said.

Currently, over 75 percent of payments in Russia-China trade settlements are made in US dollars, according to Rossiyskaya Gazeta newspaper.

In early July, the Central Bank’s chairwoman Elvira Nabiullina said Moscow and Beijing were close to reaching an agreement on conducting swap operations in national currencies to boost trade. The deal was later discussed during her trip to China.

The BNote: Green Currency in Baltimore

Jeff Dicken and Michael Tew
Reality Sandwich 

Where are we now, and how did we get this far?
The energy is building.  Even before we have printed a single note, everywhere we go in Baltimore people have already heard of the BNote, and businesses are signing on to accept them when we launch next year.  We are finding that people are very receptive to the idea of an alternative economic system - one that will benefit people instead of corporations.  Google searches now show blogs and internet media referencing Baltimore’s new local currency, and we’re starting to get coverage in the local press and on the radio.  Our currency design contest went global when other sites starting picking us up on the net.  When the BNote arrives in Baltimore, only the birds will be surprised.

In less than a year, we have managed to build this idea into an organization that is on track to create a strong local currency with broad participation.  Much of this progress has to do with the diversity and positive vision that the Evolver movement has already been able to foster in its local groups.


The first Baltimore spore on local currencies happened in mid-2009.  Damien Nichols, who attended, suggested to his friend Michael Tew that he come to the next spore and meet the people there, who seemed to be working to achieve similar goals.  Michael had background in both microfinance and legislative lobbying, and had been looking for an opportunity to advance alternative economic systems on a community level.  Michael attended the food spore, and on the strength of his participation in the discussion that night, he was invited to make a short presentation at the 2012 spore on the subject of microfinance.  There, he put forth the idea that, by the end of 2012, a micro-finance based economy (which is fundamentally different from the Capitalist economy in many important ways) would be the dominant form of economic organization for the majority of the people on planet earth.  And that Baltimore would be a very good place to bring microfinance and local currency together.

At the end of that spore, Michael met Jeff Dicken, a long-time supporter of microfinance efforts with an IT systems and arts background.  Through this and subsequent conversations, the idea of a local currency being a necessity for a resilient community and city, in the face of the economic meltdown and further upheaval to come, began to take root.  Soon after, Jill Harrison brought her own social justice and non-profit background to the endeavor.  After some informal meetings over the winter, Michael moved to Baltimore in March 2010, and a series of regular meetings was established.  At first, there were just two or three of us, but as we continued to talk with other Evolvers about the effort, we started to attract people willing to help, and by the end of June we had an increasingly effective and growing team of enthusiastic volunteers.

The basic questions on starting a currency were raised: debit system or paper money; what organizational form to adopt; how to go about designing and printing the currency; how to enroll people in participating, and so on.  Notes from each meeting, including links to relevant Internet resources, were distributed among the group.  Keeping everyone communicating was one of the keys to forming a committed, ongoing project, and many of the system’s features - the “BNote” name, the approach of issuing only 1- and 5-dollar value notes the first year, etc. - were discussed informally via email between meetings before being adopted by the group.  The Lewes (England) Pound site’s guide to starting a currency and Peter North’s book Local Money provided invaluable guidance as we started to put together the strongest features of other currencies already in existence.

We decided that our currency would be convertible to and from U.S. Dollars, and that we would restrict ourselves to a specific, identifiable geographic neighborhood for a pilot project.  Both Jeff and Ian McDonald had realized independently that the Hampden community in Baltimore would be a strong launching place for the BNote, and as we looked more closely, we found that the area had many features that are important for the strong adoption of a local currency:

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Wall Street and the Fed

Freedom Watch


Related Article:  The Worst Year Ever

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The Worst Year Ever

The Worst Year Ever


Did you know that the U.S. Dollar has lost 97% of it's purchasing power (value) since 1913, the same year Congress passed the notorious Federal Reserve Act?  Few Americans know the truth about the Federal Reserve. The reality: the Federal Reserve is no more a part of the federal government than is Federal Express. The Federal Reserve is a private corporation run by private bankers.


Why should we care? Because as President Thomas Jefferson, President Andrew Jackson and President Woodrow Wilson all understood, a private central bank has the power to destroy our lives and steal our freedoms.


The U.S. Treasury, in connection with the Federal Reserve, has "loaned" billions of taxpayer dollars to banks here in the U.S. and around the world and there is no guarantee we will ever be re-paid. This is nothing more than the rich bankers taking care of their rich banking friends while creating further inflation that limits our buying power of essentials such as food and clothing. In other words, the injections of liquidity by the feds in the billions of dollars have caused you and me to be the recipients of a "hidden tax" through the debasement of our currency.


While many doubted the predictions that the federal government, at the encouragement of the Federal Reserve, and with your tax dollars, would bail out many banks from their bad business decisions or that major banks would fail and that massive inflation was to follow we see it happening now. The corporations are attempting to hide food price inflation by decreasing the size of the food containers, thus the amount of product, while the price remains the same.  Do these criminals really think the American people are that stupid?


As you will see from the Presidential warnings below, the expansion of an all powerful central government is created through the unconstitutional and self serving fiscal policies of a central banking system.


Americans had better wake up to what is going on and start electing state and federal officials that have the understanding of President Thomas Jefferson, President Andrew Jackson and President Woodrow Wilson's, although I think is to probably too late to reform the political process which will be necessary in order to reverse these events.


Thomas Jefferson on the dangers of a central bank wrote: 


If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation the banks and corporations that will grow up around them will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. Thomas Jefferson, President of the United States 1801-1809 


Can you say corporate fascism? The American Heritage Dictionary defines corporate fascism as:  A philosophy or system of government that advocates or exercises dictatorship through the merging of state and business leadership. 


What do you call the government backed bailout of numerous banks and corporations if not corporate fascism?


What do you call it when members of Congress and the President's Administration implement national and international policy based not on legislation but on "agreements"? These "agreements" create rules and regulations that are implemented without Congressional approval. Whether it is the creation of the Transatlantic Common Market or the North American Union, the players are the same and the losers are always hard working Americans.


These "agreements" undermine national sovereignty; destroy America's middle class and create more dependants for an ever increasing powerful central government. Meanwhile, huge American and multinational corporations reap huge financial profits while politicians have their campaign coffers filled so they can be guaranteed re-election. That is, until they decide to retire from "public service" only to be hired by the corporate titans they worked for while "serving" on Capitol Hill.  Payback is a rich, former congressman making millions working in the "private sector".


Now you understand why President Thomas Jefferson in 1816 wrote, "I believe that banking institutions are more dangerous to our liberties than standing armies." 


President Andrew Jackson Eliminated the Central Bank


In his "Farewell Address" on March 4, 1837, President Andrew Jackson warned about the dangers of a central bank that created fiat currency. Jackson was a strong believer in the "hard assets" of gold and silver as a currency.


The Second Bank of the United States was a corporation chartered by Congress to provide a national paper currency and manage the government's finances. Like Thomas Jefferson, Jackson believed such a bank to be dangerous and unconstitutional. In 1832, he vetoed a bill to extend the Bank's charter beyond its scheduled expiration in 1836. Jackson's veto message counter posed the virtuous plain people against the Bank's privileged stockholders. The next year Jackson moved the federal government's deposits from the Bank to state-chartered banks, triggering a brief financial panic and prompting the Senate to censure him in 1834. Undeterred, Jackson launched a broader assault against all forms of government-granted privilege, especially corporate charters. His Farewell Address in 1837 warned of an insidious "money power." 


"The severe lessons of experience will, I doubt not, be sufficient to prevent Congress from again chartering such a monopoly, even if the Constitution did not present an insuperable objection to it. But you must remember, my fellow-citizens, that eternal vigilance by the people is the price of liberty, and that you must pay the price if you wish to secure the blessing. It behooves you, therefore, to be watchful in your States as well as in the Federal Government. The power which the moneyed interest can exercise, when concentrated under a single head and with our present system of currency, was sufficiently demonstrated in the struggle made by the Bank of the United States."


"The distress and sufferings inflicted on the people by the bank are some of the fruits of that system of policy which is continually striving to enlarge the authority of the Federal Government beyond the limits fixed by the Constitution. The powers enumerated in that instrument do not confer on Congress the right to establish such a corporation as the Bank of the United States, and the evil consequences which followed may warn us of the danger of departing from the true rule of construction and of permitting temporary circumstances or the hope of better promoting the public welfare to influence in any degree our decisions upon the extent of the authority of the General Government."


"… if you had not conquered, the Government would have passed from the hands of the many to the hands of the few, and this organized money power from its secret conclave would have dictated the choice of your highest officers and compelled you to make peace or war, as best suited their own wishes. The forms of your Government might for a time have remained, but its living spirit would have departed from it."    


"The paper system being founded on public confidence and having of itself no intrinsic value, it is liable to great and sudden fluctuations, thereby rendering property insecure and the wages of labor unsteady and uncertain. The corporations which create the paper money can not be relied upon to keep the circulating medium uniform in amount. In times of prosperity, when confidence is high, they are tempted by the prospect of gain or by the influence of those who hope to profit by it to extend their issues of paper beyond the bounds of discretion and the reasonable demands of business; and when these issues have been pushed on from day to day, until public confidence is at length shaken, then a reaction takes place, and they immediately withdraw the credits they have given, suddenly curtail their issues, and produce an unexpected and ruinous contraction of the circulating medium, which is felt by the whole community. The banks by this means save themselves, and the mischievous consequences of their imprudence or cupidity are visited upon the public." 

"Our growth has been rapid beyond all former example in numbers, in wealth, in knowledge, and all the useful arts which contribute to the comforts and convenience of man, and from the earliest ages of history to the present day there never have been thirteen millions of people associated in one political body who enjoyed so much freedom and happiness as the people of these United States. You have no longer any cause to fear danger from abroad; your strength and power are well known throughout the civilized world, as well as the high and gallant bearing of your sons. It is from within, among yourselves--from cupidity, from corruption, from disappointed ambition and inordinate thirst for power--that factions will be formed and liberty endangered. It is against such designs, whatever disguise the actors may assume, that you have especially to guard yourselves."

You can read President Jackson's entire Farewell Address at this link.

President Woodrow Wilson Establishes the Federal Reserve 


Sadly, President Woodrow Wilson did not read and heed the warning of President Andrew Jackson and in 1913, President Wilson signed the legislation that created the Federal Reserve. Years later, President Wilson acknowledged the harm he had brought to America. 


"I am a most unhappy man. I have unwittingly ruined my country. A great industrial nation is controlled by its system of credit. Our system of credit is concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men. We have come to be one of the worst ruled, one of the most completely controlled and dominated Governments in the civilized world no longer a Government by free opinion, no longer a Government by conviction and the vote of the majority, but a Government by the opinion and duress of a small group of dominant men." -Woodrow Wilson, after signing the Federal Reserve into existence

"A great industrial nation is controlled by its system of credit. Our system of credit is privately concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men...We have come to be one of the worst ruled, one of the most completely controlled and dominated, governments in the civilized world-no longer a government by free opinion, no longer a government by conviction and the vote of the majority, but a government by the opinion and the duress of small groups of dominant men.."

If the current financial storm turns into a tsunami the central bankers and their politicians will be either relieved of duty by angry Americans that demand a truly free, free-enterprise system or they will be entrenched with even greater power and America will have fully embraced corporate fascism, the worst manifestation of tyranny.


Considering the implications of modern technology, the people who are allowed to live,  will be micromanaged (tracked, traced, and databased) as slaves to the corporate fascists who already own this country and many other's around the globe.


I believe it is time for Americans to join others around the world to fight against the establishment of a global scientific dictatorship which is sought by the international bankers and global elites.


What can you do?  Educate yourself, family, and friends.  Prepare for a collapse of civilization.


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Preparing For Large Scale Economic Breakdown and Civil Unrest

NewsNet14

The majority of Americans believe that recent government intervention into financial markets, the economy and corporate insolvency has reversed the economic downturn which was described by former Treasury Secretary Hank Paulsonas being “on the brink” in 2008. The stimulus, bailouts and unrelenting quantitative easing by the Federal Reserve have thus far been perceived as having averted the further erosion of the U.S. real estate and equities markets. And though the Federal Reserve and economic analysts have recently readjusted their economic growth forecasts downward for the next six months, Americans no longer have to worry about, as Rep. Brad Sherman (D-CA) said on the house floor in October of 2008, the sky falling, multi-thousand point drops in stock markets and martial law in America.

The recovery – if our government, the Federal Reserve and mainstream media are to be believed – is on the road to recovery – albeit slowly and with some more pain ahead.

If we’ve “prevented economic collapse” and “avoided the depression many feared,”according to President Obama, inquiring minds are asking why the Pentagon and US Military are actively and aggressively engaged in planning responsive action to large scale economic breakdown and civil unrest scenarios:

Ever since the crash of 2008 the defense intelligence establishment has really been paying a lot of attention to global markets and how they can serve as a threat to U.S. national security interests. At one upcoming seminar next month they’re taking a look at a lot of the issues.

According to the report, the Army has spent time on financial market trading floors with JP Morgan and others, in the hopes that they can learn more about how a financial and economic attack may occur, and what the ramifications of such attacks on US stocks and bonds may be.

The Army, in a year-long war games series called Unified Quest 2011, is looking at a variety of possibilities and how to deal with them, including:

• the implications of “large scale economic breakdown” inside of the United States
• how to maintain “domestic order amid civil unrest”
• and ways to deal with fragmented global power and drastically lower budgets

Clearly, the U.S. government is making contingency plans to deal with a worst-case, all-out-collapse scenario of not only the economy, but our social and political systems.

The war gaming, according to reports, began in 2008 at the onset of the economic crisis, but planners from not just the United States, but around the globe, may have been aware of the dire possibility of economic collapse even earlier. It’s well known that the U.S. government as well as foreign counterparts have been preparing bunkers and continuity of government for decades, but recent preparedness activities suggest that the planning in some aspects has been expedited. Anecdotal evidence indicates that the US government has been the leading buyer of freeze died foods for the last couple of years, and private emergency shelter contractors have reported a shortage in equipment and supplies for building personal-sized bunkers.

In a previous report titled Homeland Security To “Regionalize” Emergency Supplies Over Next 90 Days, we pointed out that FEMA, headed by Department of Homeland Security, is decentralizing emergency supplies from one main distribution facility in Washington D.C. to fifteen regional facilities around the country. Even the Russians and the EU are in high gear. Russia has reportedly begun planning and development of5,000 new underground bunkers for the city of Moscow scheduled for completion no later than 2012. The EU, in 2006, commissioned the building of a “Doomsday Seed Vault” in a mountainside several hundred feet above sea level. The facility was built and fully stocked with millions of seeds from around the world within 18 months.

Though the activities of global governments in recent years could potentially be chalked up to standard national security preparedness and contingency planning, the most alarming indicator that the U.S. government is not just looking at one-in-a-million possibilities in terms of economic collapse is the training of several thousand U.S. Army soldiers to respond to domestic policing and enforcement issues that may include evacuation, detainment and riot response. The real possibility of the need to deploy U.S. military under martial law exists, and the U.S. government is spending millions of dollars training and equipping soldiers to do so if necessary.

For those who may have their doubts about some of the scenarios these soldiers are training for, we point out the sign being held by one of the riot role players below.

It is hard to imagine an America under an economic attack so serious that the U.S. economy could suffer a collapse that would essentially put an end to the world as we have come to know it. But for those who think rationally, especially given the current malaise in financial markets and the U.S. dollar, the possibility cannot be ruled out.

As such, any government acting in the interests of national security would take steps to deal with and respond to such an event(s).

For the average populace prole, however, there may not be any real assistance should something like this occur. First and foremost, any government response to an attack on our financial and economic systems will have the primary goal of maintaining order and the rule of law, as well as continuity of government. This is a given.

This means that if, for whatever reason, be it a collapse of the US dollar that leads to disruptions in the flow of U.S. food supplies or an economic war that goes “hot” leading to worst-case scenarios like cyber attacks on U.S. infrastructure elements like electric and water utility plants or an EMP attack, the government’s mandate will not be to provide food and security for your family, but rather, for those who are deemed essential to accomplishing the primary goals.

This means that when and/or if it hits the fan, you’re going to be on your own.

If you haven’t yet, we recommend taking the advice of FEMA (pdf), who suggest that every family have emergency preparedness supplies on hand, including food and water, for at least a couple of weeks.

For the hard core “preppers” amongst us, you may have already considered this possibility and the chance that the fallout from an economic collapse may lead to an inability to perform daily transactions with the U.S. dollar,  food supply disruptions, violence and looting, and even a completely ‘down-grid’ where utilities are completely out of service. If you haven’t, what would you do if you awoke to news of a total meltdown in the US dollar – one that led to rejection of the US dollar as a currency for international settlement?

Will you be the one facing off against highly trained U.S. military personnel holding a “Food Now” sign at an inner city riot?

The U.S. government and many of their counterparts around the world are getting ready – just in case – maybe you should be too.

SOURCE

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The Death Of The Dollar? 11 Signs That We Could Be On The Verge Of A Global Currency Crisis

It's called the American Dream because you have to be asleep to believe it! George Carlin (VIDEO)

THE AMERICAN DREAM

Over the past several decades, the U.S. dollar and other major currencies around the globe have been continually devalued, but they have still remained stable enough for trade to flourish and for the world to enjoy an unprecedented era of prosperity.  However, that all may now be changing.  Many analysts now fear that the new $600 billion program of quantitative easing by the U.S. Federal Reserve may set off a round of "competitive devaluations" across the globe that could precipitate a global currency crisis.  If that happens, it might not just be the death of the dollar that we are talking about.  Instead, we could potentially see the death of fiat currencies worldwide in the coming years.  Under the current system, nations have a built-in incentive to devalue their national currencies because it gives them a competitive advantage in world trade.  In fact, quite a few countries have been doing this for years, but in 2010 currency devaluations have become a "hot button" issue and the extreme actions taken recently by the U.S. Federal Reserve and other global central banks have pushed us to the brink of a global currency war.

The U.S. dollar was the first fiat currency to ever be used as a true reserve currency literally all over the globe.  For decades, nearly the entire world has had a tremendous amount of faith in the U.S. dollar and in U.S. government debt.  If the world was to lose faith in the U.S. dollar and in U.S. government debt, the entire global financial system would crumble.  Unfortunately, thanks to the foolish actions of the Federal Reserve, it looks like that is exactly what is starting to happen.

The following are 11 signs that we could be on the verge of the death of the U.S. dollar and of a global currency crisis....

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Dollar Begins Crash in Response to QE2 as Gold Scores New High

Kurt Nimmo
Infowars.com
November 5, 2010

Earlier this year, Lindsey Williams told Alex Jones the globalists would devalue the dollar and jack up the price of oil.

Due to Fed policy, the U.S. dollar is now at risk of crashing and consumers will soon be hammered with higher prices.

Both are now happening.

On Thursday, in response to the Federal Reserve’s announcement that it plans to monetize the debt and increase the money supply, economists and market strategists warned that the sickly U.S. dollar is now at risk of crashing and consumers will soon be hammered with higher prices.

“Consumers should prepare for another turn of events like the spring of 2008, when oil prices soared to $147 a barrel and gas at the pump was more than $4 a gallon,” Axel Merk, chairman and chief investment officer of Merk Investments, of Portland, Maine, told CNBC.

Oil futures reached $87.22, the highest price in more than two years, Bloomberg reports this morning.

Merk said the Fed’s plan for inflation will show up at the gas pump. “We’re not going to get wages to go up. We’ll get the price at the gas pump to go up instead,” he said.

The Fed’s Q2E plan is being roundly condemned. China, Germany and Brazil are warning that the plan to inject more than $600 billion of funny money created out of thin air into the economy will have disastrous consequences. It will send money flooding into their markets seeking higher returns and that will drive up exchange rates and hamper exports by making their goods more expensive.

China’s central bankers are not ebullient. “If the domestic policy is optimal policy for the United States alone, but at the same time it is not an optimal policy for the world, it may bring a lot of negative impact to the world. There is a spillover,” said Zhou Xiaochuan, governor of the People’s Bank of China.

Investors are scampering in search of shelter. “There’s no such thing anymore as a safe asset. Cash is no longer safe,” said Merk. “Do what central banks do, they diversify to baskets of currencies.”

Gold, silver, and precious metals remain a strong diversification option.

On Friday, gold futures shot up higher and posted a new record, their second in a row and a day after the metal had its biggest one-day gain in nearly 20 months. Gold rallied to $1,383.10 an ounce on Thursday after the Federal Reserve announced its policy to attack the dollar and unleash a broadside on the world economy through its QE2.

–

Kurt Nimmo edits Infowars.com. He is the author of Another Day in the Empire: Life In Neoconservative America.

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Peter Schiff: This is truly an Orwellian World

America20xy

The Schiff Report

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Rampant Inflation In 2011?

The Economic Collapse
October 4, 2010

Are you ready for rampant inflation?  Well, unfortunately it looks like it might be headed our way.  The U.S. monetary base has absolutely exploded over the last couple of years, and all that money is starting to filter through into the hands of consumers.  Commodity prices are absolutely skyrocketing, and it is inevitable that those price increases will show up in our stores at some point soon.  The U.S. dollar has already been slipping substantially, and now there is every indication that the Fed is hungry to start printing even more money.  All of these things are going to cause a rise in inflation.  Not that we aren’t already seeing inflation in many sectors of the economy.  Airline fares for the holiday season are up 20 to 30 percent above last year’s rates.  Double-digit increases in health insurance premiums are being reported from coast to coast.  The price of food has been quietly sneaking up even at places like Wal-Mart.   Meanwhile the U.S. government insists that the rate of inflation is close to zero.  Anyone who actually believes the government inflation numbers is living in a fantasy world.  The U.S. government has been openly manipulating official inflation numbers for several decades now.  But we really haven’t seen anything yet.  As increasingly larger amounts of paper money are dumped into the economy, we are eventually going to see the worst inflation in American history.  The only real question is how far down the road are we going to get before it happens.

Take a few moments and digest the chart below.  It shows just how dramatically the U.S. monetary base has been expanded recently….

Up to this point this dramatic expansion of the U.S. monetary base has not caused that much inflation because U.S. government borrowing has soaked most of it up and U.S. banks have been hoarding cash and have been building up their reserves.

However, this situation will not last forever.  Eventually all this cash will make its way through the food chain and into the hands of U.S. consumers.

But what is even more troubling is the dramatic spike in commodity prices that we have seen in 2010.

Wheat futures have surged 63 percent since the month of June.  Wheat has recently been selling well above 7 dollars a bushel on the Chicago Board of Trade.

But wheat is far from alone.  In his recent column entitled “An Inflationary Cocktail In The Making“, Richard Benson listed many of the other commodities that have seen extraordinary price increases over the past year….

*Agricultural Raw Materials: 24%

*Industrial Inputs Index: 25%

*Metals Price Index: 26%

*Coffee: 45%

*Barley: 32%

*Oranges: 35%

*Beef: 23%

*Pork: 68%

*Salmon: 30%

*Sugar: 24%

*Wool: 20%

*Cotton: 40%

*Palm Oil: 26%

*Hides: 25%

*Rubber: 62%

*Iron Ore: 103%

Now, as those price increases enter the chain of production do you think that there is any chance that they will not cause inflation?

Do you think there is any chance at all that producers and retailers will not pass those costs on to consumers?

It is time to face facts.

Those cost increases are going to filter all the way through the system and your paycheck is soon not going to stretch nearly as far.

Inflation is coming.

Many savvy investors understand what is going on right now.  That is one reason why gold and silver are absolutely soaring at the moment.

The price of gold set another record high on Friday for the sixth straight day.

Silver has also experienced extraordinary gains recently, and the U.S. Mint has officially raised their wholesale pricing above spot on American Silver Eagles from $1.50 to $2.00.

Meanwhile, there are even more rumblings that the Fed wants to print lots more money.  On Friday, the president of the Federal Reserve Bank of New York, William Dudley, stated that the high unemployment and the low inflation that the United States is experiencing right now are “wholly unacceptable”….

“Further action is likely to be warranted unless the economic outlook evolves in such a way that makes me more confident that we will see better outcomes for both employment and inflation before long.”

During his remarks, Dudley even mentioned what the effect of another $500 billion increase in the Fed’s balance sheet would be.

Now keep in mind, this is not just another “Joe” who is making these remarks.

This is the president of the Federal Reserve Bank of New York – the most important of all the regional Fed banks.

In recent weeks it is almost as if you can hear Fed officials salivate as they consider the prospect of flooding the economy with even more money.

Up to this point, very little has worked to stimulate the dying U.S. economy.  The Federal Reserve and the Obama administration are getting nervous as the American people become increasingly frustrated about the economic situation.

So will flooding the economy with even more money and causing even more inflation do the trick?

Well, no, but what inflated GDP figures will do is enable Obama and the Fed to say: “Look the economy is growing again!”

But if a flood of paper money causes the value of goods and services produced in the U.S. to go up by 5 percent but the real inflation rate is 10 percent, are we better off or are we worse off?

It doesn’t take a genius to figure that one out.

So don’t get fooled by “economic growth” numbers.  Just because more money is changing hands doesn’t mean that the U.S. economy is doing better.

In fact, many American families are going to be financially shredded by the coming inflation tsunami.

Just think about it.

How far will your paycheck go when a half gallon of milk is 10 dollars and a loaf of bread is 5 dollars?

Already, it is incredibly difficult for the average American family of four to get by on $50,000 a year.

So how much money will we need when rampant inflation starts kicking in?

And do you think that your employers will actually give you pay raises to keep up with all of this inflation?

Not in these economic conditions.

In fact, median household incomes are declining from coast to coast all over the United States.

Earlier this year, Ben Bernanke promised Congress that the Federal Reserve would not “print money” to help the U.S. Congress finance the exploding U.S. national debt.

Did any of you believe him at the time?

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Did any of you actually believe that the Federal Reserve would act responsibly and would attempt to keep the money supply and inflation under control?

The reality is that the entire Federal Reserve system is predicated on perpetual inflation and a perpetually expanding national debt.

Whatever wealth you and your family have been able to scrape together is going to continue to be whittled away month after month after month by the hidden tax of inflation.

And unfortunately, as discussed above, inflation is about to get a whole lot worse.

So is there any room for optimism?  Is there any hope that we will not see horrible inflation in the years ahead?  Please feel free to leave a comment with your opinion below….

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