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The global central banks bailout is to flood the U.S. dollars by lowering its borrowing cost by 0.50%. It will result in more liquidity and is another form of money printing. The result is the U.S. dollar will eventually weaken, inflation will rise and gold will soar. Most likely, the Euro would not survive with the current members. Instead of dealing with the lowering debt, keep printing money and borrowing would eventually have a devastating consequence down in the road.
Albert Einstein on
capitalism and socialism In 1949, he wrote an influential essay for the inaugural issue of the Monthly Review titled “Why Socialism?” In
it, he argued that unrestrained capitalism produced great disparities of
wealth, cycles of boom and depression, and festering levels of unemployment.
The system encouraged selfishness instead of cooperation, and acquiring wealth
rather than serving others. People were educated for careers rather than
for a love of work and creativity. And political parties became
corrupted by political contributions from owners of great capital. It appears this is exactly what is going on nowadays which Albert Einstein understood in 1949. Politicians are bought by owners of great capital (Wall Street institutions, bankers, lobbyists, billionaires, etc.). Most people are working to make money regardless of ethics or loving other people. Politicians are working for themselves (re-election) rather than for the country or for the people. Too much of socialism are problematic too as Europe is in trouble now. However, too much capitalism are not so good either as Einstein had predicted it.
What is wrong with the stock
market or America? It is a scary stock market: one day it is up significantly and the next day it is down even more. What is going on? Again, looking at the big picture. This problem actually started before 2000 with the easy money policy by politicians (the president, Fed chairman, members of Congress) to try to help the U.S. economy. Historically, when any government tried to do something, they usually messed up pretty badly. That is the reason why the communism failed miserably while the capitalism has been worked beautifully. See, the private sector (vs. governments) does a wonderful job of accomplishing something. For example, John Doe who is an entrepreneur generally works many times harder than a normal government worker. An entrepreneur usually put so many hours for his or her business and does not mind working during the weekend. Because it is their business, they go out of the way to make sure the business successful by treating customers as kings or queens. Comparably, what is your experience dealing with most of government workers: such as police, motor vehicle personnel, tax department personnel, etc.? Not only they are not nice but they act like they are really special thinking that they have some kind of God giving "authority." You know what I mean as I am sure you have a not so pleasant experience dealing with a government worker. Nowadays, the main objective of most politicians is to be re-elected: even though they say they are really care about the country. These politicians are keep voting for a larger debt, printing more money and growing its government size (in the name of helping the country and its people). However, the result is that the unemployment rate is high, government entitlements are growing outrageously, and keep helping companies that supposedly bankrupted because of their in-competencies. This helping is not really fair to those businesses that are working really hard. They cannot compete with the government helped companies that got almost free money even though they are not competitive and productive. That is another reason why many European countries are in trouble. Less competition and more socialism made more borrowings than making money by being productive. One cannot get of a debt trouble by borrowing more money. Never. It gets really worst at the end. However, that is what is going on in Europe and the U.S. That is why smart people are keep taking money out of the stock market except when the Fed hints the more printing money (QE3). Smart people are keep buying up gold. Printing more money will make the U.S. dollar just a paper. Some people say the gold is in the bubble phase. However, in term of the expansion of the U.S. dollars in recent years, the gold price did not go up. Actually, it went down. Yes, the price of gold went up so quickly in recent days so there is a chance it would take a little breath. However, unless the U.S. and Europe wake up and work productively by not resorting to the printing money, the gold price will keep on going much higher in coming years.
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