Dollar On Its Last Leg

The private Federal Reserve has been injecting fiat into our financial system for quite some time. The acceleration in 2008 heralded a new stage, however, in the devaluation of the dollar. Contrary to popular belief, the bailouts and quantitative easing implemented that year never actually ended. The bailouts of Fannie Mae and Freddie Mac, for instance, have continued non-stop every quarter since the mortgage crisis unfolded. Without a full audit of the Fed’s accounts, there is no way of telling how much money has been created out of thin air. We do know that it is enough to drive foreign investors and central banks out of the dollar and into gold and silver en masse:
http://www.commodityonline.com/news/Why-Central-Banks-continue-to-buy-gold-32803-2-1.html
The announcement of QE2 has compounded the precious metals issue (not because the Fed is creating more fiat, they were already doing that unhindered). No, it is because the Fed signaled to the world OPENLY that they were about to deliberately devalue the Greenback, instead of just doing it under the radar. They erased any delusions left in the investment world had that they would try to protect the stability of our currency. As a result, the dollar index has dropped like a rock into the recesses of some distant Grand Canyon, while PM’s have spiked.
As gold climbs into the $1500 range, the effect on silver will be evident. Gold will be less and less attainable by average people with lower incomes, but these same people will still be exposed to dollar devaluation, and the need for a hedge against inflation; enter silver.
I believe silver will become the single most important investment of our age, filling the void in the wage gap gold leaves behind. As gold shoots into the stratosphere, it will be silver that people turn to most for smaller investment needs, which means much higher demand and much greater returns for those who are smart enough to buy now. $27 an ounce is incredibly affordable, especially when considering that the metal has the potential to reach $75-$100 an ounce in the next two years (and that is a conservative estimate).
There is little doubt that the dollar plunge will continue to drive people towards PM’s. While Ben Bernanke and Timothy Geithner have both made claims pre-G20 that QE2 is not a move to devalue, the rest of the world is unconvinced. Reuters recently called the meeting in Seoul, Korea “G19 plus 1”, as foreign nations become infuriated with the Federal Reserve’s actions:
http://www.reuters.com/article/idUSTRE6A62BC20101107
Even Alan Greenspan has come out in opposition to QE2, saying it is a dangerous act of devaluation:
http://www.reuters.com/article/idUSTRE6AA00320101111
Now, why is Greenspan of all people suddenly coming out against blasting the financial system with fiat? It’s hard to say. We have written here often at Neithercorp about the deliberate destabilization of the American economy in order to remove the dollar as the world reserve currency and replace it with the IMF’s Special Drawing Rights (the SDR). We have also written about the possibility that the IMF will attempt to insinuate itself into the U.S. system as a “savior”, implementing supranational control over our fiscal infrastructure, just as it is trying to do in Ireland today:
http://www.bloomberg.com/news/2010-11-12/shadow-of-imf-spooks-irish-taking-pay-cuts-to-avoid-greece-style-bailout.html
It is perhaps possible that the Fed itself (the institution, not the people who run it) may one day be offered up to Americans as a sacrificial proxy to be torn down as the lone culprit of global collapse, only to then be replaced with the IMF (which is worse, because they don’t even live in this country). In any case, the dollar is going for a ride into the backwaters of historical infamy, and it will take us all with it if we do not protect ourselves from its demise. Gold, and most especially silver, give us the power to do this.