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<p>[QUOTE=&quot;InfleXion, post: 1581831, member: 29012&quot;]The thing that gives me pause here is that if the bond bubble pops then nobody is going to be buying US debt, and if nobody is buying US debt then what exactly is backing the dollar? They seem too intertwined to discount the ramifications and simply look at the relationship as it exists today while the bond market is at a multi-century high.</p><p><br /></p><p>One reason I think they will choose hyperinflation over deflation/default is because any deflation at all will make the big banks insolvent as the assets on their balance sheets decline in price, thus necessitating bailouts/money printing/inflation to keep the derivatives market from imploding and tanking the global financial system. Deflation just isn&#039;t an option unless they are ready to throw in the towel completely, or unless they can figure out a profitable business model not dependent on ZIRP skimming.[/QUOTE]</p><p><br /></p>

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