Gold Set to Rally as Fed Considers Printing More Money

No one in their right mind should believe that we've finally recovered from the “great recession”. Time after time we've seen the stock market rise and fall at the whims of the Federal Reserve, and their money printing parade known as “quantitative easing”. Everything is being propped up with funny money, and the only reason the dollar has recovered, is because every other economy on Earth is slightly worst than our own.

Now that the Fed has stopped QE3, it's only a matter of time before stocks begin to slide. When Bernanke was still in charge of the Fed, all it took was mentioning the possibility of ending QE, for stocks to plunge 1.4 percent. Now that QE3 is over, the only thing stabilizing the economy is the unspoken promise that if anything happens to the stock market, the Fed will come to the rescue with another round of quantitative easing.

While more QE from the Fed is all but guaranteed at this point, doing so may end up backfiring on their phony economy. Recently Peter Schiff has chimed in with some sobering thoughts on the matter. Any attempt to inject more money into the stock market, will only prove to investors that the economy is nothing but a house of cards.

The Federal Reserve will ultimately return to quantitative easing, which will send stocks reeling and gold soaring, asserts Peter Schiff, CEO of Euro Pacific Capital.

Now that the Fed has finished its third round of quantitative easing, it should leave well enough alone, he says. "The recession the Fed is fighting is the cure" for excesses in the financial system, Schiff told MarketWatch.

But he thinks that the Fed will implement QE4 at the first hint of weakness in the stock market or economy. And once investors realize stocks are overvalued, the dollar will plummet and gold will fly higher, he says.

"Gold prices will go ballistic, once people realize that the dollar is overvalued," Schiff said. He predicts the dollar will plunge 90 percent.

While I doubt there will be such a dramatic plunge in the dollar anytime soon, another round QE is pretty much a foregone conclusion. Unfortunately it's not going to end well for them or for us. They have so much invested in the idea that we've finally recovered from the collapse of 2008, that any move to rescue the economy is going to break the facade of progress.

If the Feds were playing poker, this would be their “tell”. They're stuck between a rock and a hard place, and no matter what course of action they decide to take, stocks are going to sink, and save havens like gold are going to make a comeback.

Even if stocks don't fall, the Fed may still enact another round of QE. They are desperate to inflate the currency as much as they can, and are terrified of the dollar's recent recovery.

You have to remember that we're all in a race to the bottom. Every central bank on earth is trying to inflate their currency, because if the money becomes overvalued, then it won't be spent domestically. Goods will be cheaper overseas, so more money will be spent there, effectively propping up the economies of foreign nations at the expense of our own. This is what every government on earth knows and fears.

And they're dragging us all along for the ride. We're trapped on a high speed train with no brakes. There is no reversal from the path of paper money and inflation, because anyone who strays from that path and tries to strengthen their currency, will be eaten alive on the global marketplace. The nations of the world have only one choice. Keep inflating your currency into oblivion, and prepare yourself for the inevitable crash by quietly buying gold.

You might want to do the same.

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The Cracks Are Showing In the Housing Market Once Again

If you observe current events, it can seem like there are economic emergencies everywhere. Every segment of the economy appears to be under immense pressure. What with the massive student loan debt, federal debt, municipal debt, derivatives, and a stock market that seems to magically rise above it all, flying in the face of all logic and common sense, it's surprising that the whole thing hasn't come tumbling down yet. And yet, the next collapse may come from somewhere that is very familiar to us. It appears that many of us haven't learned anything from the last bubble.

It's possible that the next wave of economic malaise may come from the housing market once again. Economists were expecting another increase in home building and loans. Instead, housing starts dropped 9.3 percent last month, and building permits fell 4.3 percent across the nation.

Meanwhile, The Wall Street Journal is telling everyone that there's nothing to see here (which is tantamount to telling a crowded building that the smoke isn't from fire). They're claiming that these recent declines are in fact, due to an unusually rainy season in the Southern United States. Apparently there has been a 30 percent drop in housing starts in the South. In the same paragraph the article mentions that there has been an increase of 28 percent in the Midwest and 14 percent in the Northeast. Surely those numbers alone would offset the bad weather in the South. The article also fails the mention the Western United States, where I can assure you that rain has not been a factor for quite some time.

Mortgage rates also fail to explain the situation, as they've been dropping significantly the past 6 months. Perhaps a better explanation would be the 5 percent decrease in home loan applications that took place in a May and June, which was also coupled with a slight decrease in the average loan size. Doesn't that make real sense? That perhaps not as many people can afford to buy a home, and maybe construction companies and investors are beginning to see the writing on the wall? 2+2=4, and stuff like that?

The truth is the housing market, and the economy at large, has never fully recovered. That hasn't stopped the price of housing from returning to pre 2008 levels in some areas, and the skyrocketing price of the stock market. The true nature of these events is obvious, when it can be seen that these prices have gone up significantly since Bernankes QE4 dumped billions of dollars into the economy every month. It would make sense that the markets are finally beginning to crack up, since Yellen has expressed her desire to stop quantitative easing entirely this year. Again, 2 and 2 equals what now?

Don't let yourself get caught up in these schemes. The Bernankes, Yellens, Buffets, and Soros' of the world expect you to buy buy buy just as they're getting around to selling. They rely on hype and insider secrets to fleece regular folks who enter these markets. They're trying to prop up the corpse of this economy like it's “Weekend at Bernie’s” and they expect us to buy it, literally and figuratively. Well, all I can say is, don't.

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