The World is Flat… Remember? Why, Mr. Bernanke have you forgotten that the US needs a currency that the rest of the world wants?

The World is Flat Remember? Why, Mr

The World is Flat Remember? Why, Mr. Bernanke have you forgotten that the US needs a currency that the rest of the world wants?

Recently, I am noticing an extremely disturbing trend when it comes to global macro economists. Economists once counted on to look deeply into the future and help shape our understanding of interrelated data points and economies, have become so lazy thattheir work is on the verge of losing its value and utility. Perhaps their Ivy League educations are failing them in the same way they are failing our great nation.

The Fed, for lack of a credible strategy to fix the deep in debt consumer, has gone full speed into debasing the dollar, and our formerly astute economists currently employed at our "too big to fail" Wall Street investment banks have been praising a well orchestrated recovery instead of seeing the Fed as the Ponzi scheme it has become.

Harsh perhaps, but let's take a look and then you decide. Last week we saw both the Institute for Supply Management (ISM) and the October jobs report top estimates. This tremendous feat was much celebrated not unlike what I imagine occurs when a Ponzi scheme finds a new source of funds and convinces itself things will improve and it will become legitimate because it has found a new source.

Economists are encouraged that the Fed has engineered a recovery sure to decrease imports and increase exports to significantly boost GDP in the near future.Folks, when the thinkers stop thinking we have a problem. This tune has been played before and it failed to entertain. The Fed is giving a very sick economy a sugar infusion to get it out of bed and economists are pronouncing the economy "showing impressive signs of recovery" as evidenced by rising stock prices.

People invest in stocks because they expect that deferring consumption today will result in a future which is better on relative basis than their present.The Fed is taking money from your left pocket and putting it in your right pocket and you have become convinced that you are richer than before.

Yes, the S&P has risen, but you are less well off than you were before. You see commodity prices (factors of production) have risen anywhere from 20-120% in the past six months and will very shortly squeeze producers who will want to raise prices against a consumer already pinched for discretionary funds.

Economists are telling us that our Bernanke (IVY product) induced weak dollar will result in increased exports and decreased imports, a goldilocks scenario according to Citigroup. Decreasing imports will absolutely occur, because with a weak dollar we will be unable to afford the things we currently consume from abroad (like oil). But someone please explain to Bernanke and his yes men economists, that exports will not rise because of an impending global depression brought on by the loss of our trading partners biggest customer, the debt ridden USA with its weak currency.

Let me explain for the benefit of our Ivy economists, that our trading partners will institute trade sanctions against the US to protect their manufacturing gold mine from Bernanke's currency war. Remember all those factories we shipped overseas to benefit from cheap labor?We are in fact entering a period of steadily increasing inflation, American deprivation, and isolation from the economic world because we have not been self sufficient in decades and it will cost trillions of dollars that we do not have to rebuild our domestic capacity.

Follow my logic here since the rest of the world will no longer be selling to the US, they won't have the surplus funds or the desire to buy our debt.If you think our bloated government debt is a problem now, we are about to have to finance it internally. Our Wall Street economists and politicians have been assuring us that we are not Japan and they are correct. The Japanese had the savings required to finance their government which Americans lack.

Why, Mr. Bernanke have you forgotten that the US needs a currency that the rest of the world wants, and why would they want dollars if the US consumer no longer buys their goods?

Real leadership would craft solutions to our current economic malaise that would not serve to anger those who are giving us the means to keep the lights on.We are financially very sick and the last thing we should be doing is angering the bank and then telling our kids that everything is going to be ok.

Our current Fed and our entire political leadership is the product of the turned up noses of Ivy League education and its liberal thinking. I have pulled my daughter out of the liberal thinking Ivy League process and she is happily enrolled in the same state run university I graduated from.

I will take the $200,000 I save on tuition and invest in her by encouraging her to start a business. If she succeeds (low odds I know) she will reap for life what I have sowed. If she fails she will have learned so much more about serving a customer and being nimble than she would have learned at any Ivy League mind expanding institution which has produced the kind of thinking displayed by our current Fed chair and the legions of economist lemmings.

Be well.

www.alphafiduciary.com

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