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<p>[QUOTE=&quot;InfleXion, post: 1534562, member: 29012&quot;]At some point these policies left unchanged must lead to hyperinflation. They have little choice in the absence of fiscal responsibility, but even so the debt has to continue to grow exponentially as it has for decades or else deflation will take precedence. Fiscal responsibility has little chance in a nation where anyone wanting to cut the welfare state will lose the popular majority vote. </p><p><br /></p><p>Since pretty much all of the SWIFT system central banks are doing monetary injections it will probably take a lot longer to get to a hyperinflation than any other time in history, but it seems like a mathematical inevitability on a long enough timeline. Granted, I do not think QE will be the specific culprit. There is plenty of M2 expansion that is not labelled QE. ZIRP on its own is enough to lead to hyperinflation over time. NIRP is faster. </p><p><br /></p><p>That&#039;s notwithstanding the $16 trillion gifted out under the table along with TARP that only came out in recent GAO audits. Who knows what other gifts are yet to be uncovered. QE to date is only $2.3 trillion so that&#039;s really not much at all in comparison to $16T, or the massive $1.7 quadrillion derivatives bubble. Exter&#039;s pyramid lays it out perfectly. Then there are the dollar swap lines to the ECB which are at a 4 year high. </p><p><br /></p><p>So inflation is not QE dependent. QE is just a subset of the grander scheme. IMO the purpose of QE is to backstop the risk takers in the bond markets so that sovereigns can continue down the path of austerity and globalization. If they decide to raise interest rates then they can go ahead and opt for deflation instead of hyperinflation, but as you correctly stated that is the true specter and it just doesn&#039;t appear they are going to get hawkish anytime soon. </p><p><br /></p><p>If the economy picks up and no longer needs injections I&#039;m sure they will glady change their tune. That&#039;s a big if right now with China contracting below 8% growth (still quite a lot though, but slowing), and all the question marks in the Eurozone still. Spanish investment is leaving the nation at a fever pitch right now, and it&#039;s not looking like Greece is going to meet their terms. </p><p><br /></p><p>The underlying problem is that you can&#039;t extinguish debt with debt based money. Only gold and silver can do that. The longer it takes for them to be remonetized the higher they will need to go to fulfill their role in this regard unless the powers that be opt for default instead, in which case the money will be no good if the nation cannot service its debt. </p><p><br /></p><p>Until either of those situations happens then we will continue to have fractional paper denominated prices in the metals unless someone can&#039;t deliver on their paper silver or China comes out with their fabled 1:1 physical exchange. So I do not expect &quot;to the moon&quot; under the current circumstances which are of course subject to change. I am just thankful to be able to buy at these prices.[/QUOTE]</p><p><br /></p>

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