Supply, Demand & USDollar

[rockclimber]

By Jim Willie CB
Jul 20 2011 2:34PM


http://www.GoldenJackass.com

Use the above link to subscribe to the paid research reports, which include coverage of critically important factors at work during the ongoing panicky attempt to sustain an unsustainable system burdened by numerous imbalances aggravated by global village forces. An historically unprecedented mess has been created by compromised central bankers and inept economic advisors, whose interference has irreversibly altered and damaged the world financial system, urgently pushed after the removed anchor of money to gold. Analysis features Gold, Crude Oil, USDollar, Treasury bonds, and inter-market dynamics with the US Economy and US Federal Reserve monetary policy.

The economic theory in textbooks must be updated to account for Fiat Soft Science. An important third factor determines price. It is not demand, as most Deflationist Knuckleheads claim. It is not supply, as the moronic followers of Laffer Curve advocates insist. Instead, it is the falling USDollar since all commodities are priced in US$ terms. Lower demand will not result in lower commodity prices, since the monetary effect trumps all. The twist lies in the pricing denomination units, not in the Price Demand dynamics. An inflationary recession is deeply rooted in progress, with a depression next to occur. The price effects continue to confuse the challenged economists who have actually foreseen almost nothing in the current ongoing crisis. Their collective value is far less than garbage collectors who tend to the landfills, or landscapers who improve the appearance of home lawns. The crisis toward wreckage all occurs like a wrecked house floating over a waterfall for all to observe in sheer horror, as wealth evaporates and national sovereignty is forfeited to creditors.

What follows is my analysis of the erroneous path taken by the myopic Deflationist fools. The entire table of commodity prices is rising. Since the advent of QE, QE-Lite, and QE2, the full price structure has been rising steadily and noticeably. As the USDollar declines in value, the price of any commodity priced in US$ terms rises. The USDollar is not the constant, as they along with Wall Street mavens believe. Gold is constant, and the USDollar is falling versus Gold. This is basic science, but something that demand side Deflatinionist fools miss, and something that supply side Laffer fools miss. It is best to offer some solid evidence to these people with dull intellectual capacity, and move on without waiting for their awakening. Sadly, it is over their heads. Gold is the constant, as the USDollar moves in shifting patterns within its stable golden sphere. The commodities therefore all change in US$ terms as a result. The Knuckleheads miss utterly basic principles, spout nonsense repeatedly, remain steadfastly ignorant of their errors, learn nothing in the process, sound arrogant while on the wrong path, and continue to litter the landscape with their mental drivel. They are an annoyance, even inside the gold community.

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