Wednesday, July 18, 2012

Bernanke to Congress: We're Much Closer to Total Destruction Than You Think - CNBC

Bernanke to Congress: We're Much Closer to Total Destruction Than You Think - CNBC


I think the Fed has been trying to avoid deflation from the beginning.  It seems they have taken action based on a greater fear of deflation than of hyper-inflation.  It is a hard course to steer (this metaphor is particularly apt because like steering a boat you can steer all you like but the sea and wind may take you in a different direction).  I suspect they will continue to take action that errs on the side of inflation.  If that is wrong (they steer a middle course and are blown off course toward deflation) gold is the absolute wrong place to be.  

I am betting on inflation.  If things go toward deflation I suspect it will be better to own guns...

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