Friday, July 10, 2009

Inflation or Deflation

Trace Mayer, of RuntoGold.com, has written an article looking at the inflationary argument of Gary North and the deflationary argument of Mike Shedlock.

Mayer is a deflationist, but he stresses, "the critical question is not whether there will be inflation or deflation. The vital questions for your portfolio is whether and when will there be a currency collapse and how to best prepare yourself."

He writes, "Political currency always fails in either a deflationary depression or a hyperinflationary explosion. Ultimately, investors ensconce themselves at the tip of the liquidity pyramid within an invincible and immoveable golden forcefield which is immune to both. Those who fail to move their wealth may see entire fortunes rapidly evaporated. Some already have. Indeed, The Great Credit Contraction has only begun."

I must reiterate, if you don't believe the dollar can collapse, you must look back at history. Read the recent post A Short History of International Currencies, it is obvious that all currencies eventually collapse because governments always debase them. Our government is doing everything it can possibly do to bring about a dollar collapse.

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