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Bill Fleckenstein: The Race To the Bottom Will Be Won By the Dollar
"This printing money is going to lead to huge trouble. It’s going to lead to higher interest rates. It’s going to lead to more inflation and at some point there is going to be a train wreck in the currency and the bond market."
Market commentator and money manager Bill Fleckenstein sat down for a recent interview with ChrisMartenson.com and opened fire with both barrels on the Fed and the monetary policy it's pursuing. He and Chris discuss the factors that enabled Bill to be one of the first to accurately identify and warn of the housing and credit bubbles - and how history is now repeating itself via the profligate printing of US dollars. The interview covers a wide range of topics meaningful to the investor trying to make sense of where things are headed from here - including central banking culture, bubble psychology, high-frequency trading, inflation/deflation, and the true relative value of the dollar vs the Euro.
Click the play button below to listen to Chris' interview with Bill Fleckenstein:
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In this podcast, Bill sheds light on why:
- The culture of the Fed reinforces a belief in its infallibility. That blinds it to the fact that its interventions cause market players to adopt irrational behavior leading to misallocations of capital that eventually need to be corrected by the system (e.g., busts).
- Correlation between asset classes is the highest it's been in 60 years. This is a result of the Fed flooding the market with liquidity. It makes it very hard for investors to be anything besides speculators.
- The SEC has been asleep at the switch for the past 15 years, leaving the system vulnerable to exploitation - if which HFT programs are just the latest example.
- A funding crisis looks inevitable: at some point the bond market or the currency market will revolt, resulting in a weak dollar and increasing bond rates - despite whatever the Fed wants
- It's perverse for the US to be rewarded for using a printing press indiscriminately without making any fiscal changes, while Europe is painfully adopting austerity and yet gets penalized.
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The more you look like Imus the more cred you have.
Hey brownmiddelfinger, try pulling your finger out your ass and put it into your mouth.........there......feel better now?
I made this Youtube video with pieces from part 3 of the BBC documentary, “The Power of Nightmares”. It explains the Precautionary Principal and where it came from, that has caused so much damage to our way of life and the world. This will tell you why the eco-fascists and the Neo-Cons use their apocalyptic predictions.
The Precautionary Principal-International Banking Cartel Brainwashing
http://www.youtube.com/watch?v=4GIkWuuq45I
yep, worked on me, real good matter of fact. recycle con 101. cept i got to dump my trash for free when i drove up to the landfill, half and half. subliminal conditioning at it's finest.
if you can create a want, then the rest is easy...
Why don't they open up the possibility that the FED is inherently corrupt, and creates boom and bust cycles on purpose, so their insider freinds can profit?
Martensen etc seem to be making excuses for them, without stating the obvious: the FED is a criminal organization, and is illegitimate.
Chris: stop beating around the bush and call a spade a spade.
Good videos michael.
In some good news, Joe Lieberfuck is retiring. May he burn in hell.
Joe Lieberman to announce plans to retire
zionist scum... why can't jews just be jewish??? even Israelies are sick of Zionists
Ask not what Joe Lieberman can do for the United States, but ask what Joe Lieberman, dual citizen of the U.S. and another nation, can do for the other nation (with U.S. taxpayers' monies).
peter schiff?
Not a Zionist, and most love him.
Zionism is apartheid, and leads directly to genocide. Jews don't need to support zionism any more than Republicans need to support the war in Iraq.
I don't know if he's a Zionist or not, but Peter is a crazy mofo, no wonder that many people love him. Crazies are the most lovable, ain't them?
He praised the housing regulators in the US because they de-regulated. Nevermind that it wrecked havoc. They deregulated and that makes everything good, right? Oh Peter, you're as much an idiot as you're a crazy.
The problem isn't the free market, the problem is TBTF with government backstop. Let people and businesses take as much risk as they want (AIG, Citi, Fannie/Freddie, etc...), but let them go bust, too. The market doesn't work when it is perverted by government guaranties.
Deregulate enough and then the "free" market will take over the political decision making process guaranteeing the existance of TBTF. That's exactly what happened in the US.
+1 this is what a lot of people don't understand.
Most of us on this board support free markets (an example is letting banks take on as much risk as they want) the irony is that the "free market" does not exist in America, thus when republicans and corporatist democrats continually push to "deregulate" the banking industry they simply guarantee taxpayers will get stuck with the billl when it all collapses. (it is a foregone conclusion that the FED, which is a private bank, controlled by the banking elite, will always vote to bail themselves out using the future earnings of the American people, aka slaves used to build their pyramids)
The banking industry OWNS THE GOVERNMENT (debt is slavery, our government is 14 trillion in debt!!!), when will people wake the fuck up! The government of the united states is subservient to the banking cartel (AKA the FED).
"I believe that banking institutions are more dangerous to our liberties than standing armies. Already they have raised up a moneyed aristocracy that has set the government at defiance. The issuing power (of money) should be taken away from the banks and restored to the people to whom it properly belongs."
- Thomas Jefferson
I'm sorry? In what acts of 'deregulation' were: Fannie Mae and Freddie Mac created? the Community Reinvestment Act passed? the Federal Reserve given monopoly rights to the creation of US currency? banks allowed to use different accounting practices to any other business? etc.
Good riddance to bad rubbish.
Ya some big comfort. That guy spends night and day figuring out how to fuck over normal people. Behind the scenes or front line it doesn't make him any less of a danger to dozens of societies.
+1
Hey Tyler. Make sure you link Chris' next podcast coming soon. He's whacky and a Zero Hedge poster.
Get some tits, Tommy Boy. What is your point?
The race to the bottom is on
The dollar, yen, euro and Yuan
Who will win, I don't care
I'm a smart perma-bear
I've got gold for when fiat is gone.
Spot freaking on. When the Fed sees a further deterioration in the bankster's balance sheets (not the ones they give to the SEC and file so we can call BS on them in public) they will double down on the flooding of the system and take the $600 billion up to a full blown $2 trillion so they can attempt to monetize every mortgage in the U.S. After that and a blessing of the government's upcoming $500 billion state pension bail out and municipal bond buying program, that should pretty much elminate any sane, sober, and intelligent creature from buying any of our auctions.
QE3 is now confirmed. Pick your flavor of commodity. 2x assured. 5x very probable. Pick your flavor folks. Just buy the Fuckn Dip.
I'm not so sure about QE3. The bond market is ominously beginning to move Bernanke into a corner. Bernanke can print freely when everything is dead, but as soon as the bond markets begin to wake from its coma (which it is), it can check-mate the Bernank very quickly.
QE2 was worthless. Bernanke needs to step away from the levers for awhile, and allow the market to get what it wants, which it will get anyway. The longer Bernanke stays in, the more severe the market will ultimately retaliate.
As soon as the cartel is backed into a corner, there will be a reall need for a quick diversion. I wonder what the possibilities are. hmm...
Are you trying to tell me that Apple might have difficulty growing their market share in Iran and North Korea?
It's difficult for a peace prize winner to declare war.
But signing executive orders to keep Guantanamo open, leveraging up existing wars, legitimizing the execution of U.S. citizens overseas sans trial and bowing to every chinese waiter at the state dinner, well yes, yes he can.
Agree, but also to add, the sheeple deserves their politicians. Sheeple voted for buffoons and chronic cheaters (not once but twice, so scared were they of an old man holed up in pakistan they voted for a buffoon who speaks in monosyllables and clearly has an IQ lower than 100, how stupid can the sheeple get; and of course we all know by now the buffoon's predecessor did not have sex with that woman). That's why down the country goes.
Oh and yes, Bill Fleck is correct the US will win this one, Rogoff (on FT) will be wrong about the euro being the winner of currency devaluation race. Country has pawned its grandchildren's future to the bankers, servitude awaits.
Well, I didn't vote for these knuckleheads.
Does that mean I still deserve them?
Pauli inclusion principle. The mean cheating lying bastards rule the idiots. The idiots rule you. You are fucked by the transitive property of idiocracy.
I don't think the US will win. Once the world understands that the food price rise is because of US printing profilgacy, it will be a common retaliatory front. The world vs the US.
As soon as the cartel is backed into a corner, there will be a reall need for a quick diversion. I wonder what the possibilities are. hmm...
The possibilities are endless, Dr Porkchop, and only limited by one's imagination and intelligence.
Posted by AmanfromMars on 1/19/2011 2:00:03 AM
Whenever you have a very complicated problem, is it resolved best and quickest with a very simple solution.
In another space/place, rather than everyone and everything being born and created with a notional nothing, as may be thought to be natural by the sad and the bad and mad beings on Earth, is everyone and everything born and created with great wealth, and thus does everyone and everything have all the money they will ever need, to exchange and spend freely on developing what they think they will need to seed and feed for the future.
There are the bankers not keepers and collectors of monies and baubles, they are just networking and administrative flow-through points ensuring that the universal collective wealth pool's potential is realised in currency flow which energise IT and Intelligence Communities with unhindered access to assets and novel Intellectual Property requirements for Noble Future Projects.
That simple perception change, from everyone starting off poor to everyone being rich, renders the destructive control in limiting the supply of currency, reversed and transformed into the constructive distribution of it unlimited and artificial wealth to Transparent Future Builders for novel and effortless and rapid growth.
Might I suggest a Master Pilot Trial or two, or three, to champion demonstration of the SMARTer Genre with ITs AIMemes at the Helm of IntelAIgent Command and CyberIntelAIgent Control? What is there to lose in such Future matters, apart from an abiding ignorance, which would maintain and retain you in a Present which imprisons you to Server to the Past.
http://thedailybell.com/1686/Shock-Big-Media-Fault-Elite-Finance.html
I will junk you on stupidity alone. Get real. You've been wrong for years now.
pension and muni bail out could be, if my memory is correct, over 3 trillion muni(from FT times) and pension number i dont know.
UP DATE, UP DATE:
The front runner for the Republican nomination for President in 2012, former Congressman Newt Gingrich wants a Federal Bill passed (THIS MONTH NO LESS) to allow the states to declare bankruptcy so that won't have to pay pensions or bond holders. GO NEWT, we'll show those Greeks the what for on how to handle peskey pensions and bonds. This is great news, think of all the worthless dollars the Fed won't have to print now.
http://www.pionline.com/apps/pbcs.dll/article?AID=/20110110/PRINTSUB/301109976/1039/MostPopular
Part 2 of the interview can be heard back at Chris' site: www.chrismartenson.com
Maybe, however in the meanwhile the Irish have unveiled a printing press/50 cal machine gun smuggled into Dublin shipped directly from the catacombs of New York's St Patrick's Cathedral.........just have to love that, said Tricket.
http://ftalphaville.ft.com/blog/2011/01/18/461881/the-mechanics-of-irish...
Who's putting up the money?
The ECB,has given them permission if in dire straights.
Fed is like a broken robot that still believes it's 1980. What works in one era doesn't work forever. But the Fed will never adapt until very late in the day because it clings to dogma at the expense of adaptability and objectivity. What passes for academics eventually degenerates into mere politics and that's the stage we're in right now. Unfortunately, there is a cumulative load of imbalances that build up from refusing to adapt.
fed policy in 1980 polar opposite of today. 20% short rates vs. 0%. restricted money supply vs. not.
this guy always has good insight and i do listen, but i wish more people would press the new world order coming. cuz the reason they r proping up europe,(piigs,etc) QE 1,2,3,4,5 is they are waiting the bring a new world currency at one time. why more people dont write and talk about this is beyond comprehension
gorilla,
Easy,keep the sheeple as stupid as possible for as long as possible.
I do not see the American people taking a universal crrency, I see the staes saying FU, and coming up with their own.
Some are already.
What global currency are you talking about -- don't we already have one, the USD?
The American middle class must be utterly destroyed before the NWO can be ushered in. That's what this is about. A broken and impovrished people are in no position to resist anything.
Or the results of a sovereign settlement agreement whereby the rest of the world was more than a little pissed at our institutionalized fraud...
Ah. Bernanke can stop inflation in 15 minutes.
It's not like free money is addictive or anything.
I mean shit. I know I could get free money and it wouldn't change me a bit.
http://www.youtube.com/watch?v=9MbbBYalam8
Tyler got the pictures mixed up ................
http://www.gustified.com/wp-content/uploads/2010/07/nnolte.jpg
I think Nick's calling the top. Calling it a night. The fat lady's singing. Alex Baldwin on a cell. Mel Gibson and Ben Vareen walking together on PCH. David Cassidy can too drive I-95! Even Charlie Sheen's looking for the door. MJ's doc and Anna Nicole's pharmacy. Imus in da morning!!!
One troll replies to the other. Two fools met.
It's the cruelty. It jams the weak into head up ass monsters who spout meaningless shit just to appease the angry father.
During the last week I have come across two FRNs, a $1 and a $5, both had been stamped in big letters "End the Fed" in red ink. I laughed aloud the first time when I saw the 5, but when I saw it a second time I realized this was pure genius...to use the Fed's own notes to spread the word to End the Fed. Anyone care to take credit for this?
I neither admit nor deny any participation in such antics.
I will only say that I heartily applaude the effort.
In the near future, those notes will make for beautiful wallpaper just like Weimar Germany.
They will end up like US silver and gold certificates in an antiques shop.
Max Keiser had a similar idea. Have a rubber stamp made at your local printshop with the words: "Crash JP Morgan Buy Silver".
Any FRN's that come through your hands will be well positioned for a new message.
Ron Paul supporters were doing this during his campaign for prez. Used to be able to buy the stamp at endthefed.us but they don't carry them any more.
Was "End the Fed" stacked vertically? Was the opposite side stamped "Where's the note?" or "buildingwhat.org"?
Not that I'd know anything about these things. Must be a fellow zh'er though...
If I could print my own money I would do it too.
...and if my ear was a cnt I would fck it.
Was just telling the wife that your comment was the classical ending to the limerick about the man from... never mind.
The Man From Nantucket
P . S. -
Bears over Packers. Book it.
Peppers will destroy the rookie.
Care to wager Spalding...Rogers will pick 'em apart.
get a room, bitchez.
No get an etrade account gambling bitchez.
Anaconda...
;-)
You already print your own money, it's just a question of how many people accept it as tender.
You can do it too.
Nothing illegal about it at all.
This idiot, Fleckenburger, either needs a haircut or a big, yellow hat for his dome.
Check my post above Tyler fucked up again .Its the wrong picture.
What you do not like his calls, I thought he was pure blue blood doomer' like Williams and Pritchert ...
Gentlemen, Fleckstien... has been on the side of right going back a good long while... pre-Santelli jumping the Fleckstien wagon... google is free.
TF,
I told you to watch the Au 2 year chart...are you a buyer here?
UF
Yes, Fester. Between the 2-yr and Alf Fields on Santa, I'm just about ready.
http://jsmineset.com/2011/01/18/a-note-from-alf-fields/
There's still some downside room here, but anything below 1350 would be sweet. Do not be surprised to see sideways consolidation for awhile.
Turd,
He's just showing off.
I wish I had a third of it. Isn't he EUropEan,they dig those long do's.
He kinda favors Richard Gere.
I thought there was a US dollar shortage in global banking.
Ho ho ho...hum hum hum.....bah.
More worthless jawboning. Until everyone of these "mammon managers" can step right up to the plate and call the endless crimes of the wall street mafia for what they have been and are, all this talk is just so much hot air. And each and every one of them has played the game in their own way, gamed the system as it were, primarily for their own benefit.
Matters not that they are now all anti-fed. The fed has been playing this game for decades now.
Clearly the FED is about to be de-constructed, dove-tailed into the IMF/WB/BIS, where it already takes it's orders from.
Epochal event up ahead, perhaps in the metals market? All this negativism has to find release and it will.
I vote for an LBMA default OR another huge derivative blow-up, or both.
ORI
http://aadivaahan.wordpress.com/2011/01/18/the-callousness-of-pornography/
He "opened fire with both barrels"? How very politically incorrect. This guy would look fantastic with a mullet.
http://www.google.com/#hl=en&&sa=X&ei=Ipc2TbHiOdT3gAf-sLDmAw&ved=0CBMQvwUoAQ&q=mullet+bill+fleckenstein&fp=ddb181364976507e
Why would anyone lash out against this guy?
Yeah, you know, like I'm so incredibly advanced and enlightened that your being 90% correct makes you my ENEMY because you're not within my 2% margin of error.
Ooookay.
(Anyway, he's too old, and anyone with kids is a fuckin' shill. Fuck all y'all.)
In making my daily info rounds ... I came across some stark, pithy wisdom.
"But the world has started to in whole or in part to abandon our debt. They aren’t buying more and they are even selling us back what they already had. As a consequence we are buying our own debt, which can never last long before the currency is trash".
Yep, acknowledged, the U.S. is mostly buying its own debt these days.
There really is no denying it.
Well, I guess we certainly dodged the .. "what if China stops buying our bonds" question. Chances are no foreigners would step in now ... even if Ben stopped.
So now we wait. Wait for the eventuallity,
because history tells us what that will be.
Perhaps Zerohedge can start a pool where we place bets on when the US goes belly up.
Perhaps Zerohedge can start a pool where we place bets on when the US goes belly up...
That casino already exists. It's called the bond and fx market.
That casino neglects the difference between nominal and real terms, though.
Oh, yeah, in "dollar" terms it's all good baby.
no ammo, no food and no pm's... and wants everyone to follow him down to da river....
No amount of belt-tightening or austerity can keep the budget deficit from expanding.
Blackhawk and Timmah! will not admit bankruptcy and moratorium on the debt, so we monetize.
Was there a reference to glue or something?
UF
The train left the station about 5 years ago. Since then it has been gaining speed and soon it will leave the tracks. The wreck protection team has been able to patch and stabilize the tracks with tarp,stimulus,qe1,qe lite,qe2, hamp,pomo,backdoor loans of 13.5 trillion to the ECB and other foreign banks, 0% fed window loans to who ever wants one,bailouts to US Corporations such as GM, GE,Chrysler, and Mc Donalds just to name a few. The train is gaining speed and is about to surpass the ability of the wreck protection team. Who would have thought they would go to this extent to cover their ponzi? It really is unbelievable if you think about the amount of debt we have accumulated to cover up a debt induced bubble. Just take a minute and think about all the toxic MBS that is more viral then it was in 07? Most of which is now owned by Fannie & Freddie & the FED, thank you very much. And think about the QUADRILLION in derivitive coke they have been snorting? I feel like America should just be renamed Las Vegas. Time will show its true colors and the time for the FED and all the gamblers is becomming scarce. Nothing like backing yourself into a corner and going on the MSM stating your 100% sure you can control inflation? WOW... Sometimes I feel like I'm living in some kind of dream because my gut tells me this isn't going to end well for me or the future of my children. I guess we are all just dreamers in one way or another, I just wish the dreamers in charge had a little better clue as to where this will all end. The key word for 2011 will be CHINA, they will be the ones that stop this nonsense because they are in deeper then us... the only difference is they aren't debt induced dreamers like we are, they know when to call a fantasy real.
http://www.youtube.com/watch?v=YbJqswLi3uE
Here Here!
The nation has committed suicide.
Let's not forget the bailout of the nimble, but very well connected, the legendary, clownish, homespun Norman Rockwellish maestro, Warren Buffet.
Wells Fargo, Goldman Sucks, vi AIG, and other holdings of Berkshire Hathaway, in the form of private equity or publicly traded were also bailed out to save his hypocritical ass.
T-hoe,
Newsflash, the future of your children?,hell our future.
Most yutes 19-26 are living at home NOW.
They cannot afford to leave, likely till age 40.
The FED and Groupthink?
It's not possible, this man has no idea what he is saying, he is probably shorting the market.
Wall Street and mass delusion?
Not possible, they are doing God's work.
<sarcasm off>
I thought there was a US dollar shortage in global banking.
No takers- case closed.
Nice interview, big fan of Fleck, but as usual where's the rest of the talk?
I like Martenson, but 300 bones per annum to hear the rest of his podcasts?
huh?
~MV
Per menlobear,
Part 2 of the interview can be heard back at Chris' site: www.chrismartenson.com
Why am I paying for access to Christ Martenson's site when I can read it for free on ZH?
Stop numbering the QEs. Do you think they print some money and then stop for a sabbatical of some kind? Or the FED waits for the congress to OK another round? QE is ongoing. As long as it produces the results the FED wants it will continue.