This odd result has created what I think is one of the more amusing equilibriums in monetary politics. Hard money types would like nothing more than to see their favorite asset, gold, revalued. But they don’t actively pursue the idea because of the expansionary effects a revaluation would have on the Fed’s balance sheet. Easy money types would like nothing more than to see the government get billions in free cash, but don’t like the idea of the barbaric metal getting a leg up. The upshot is that gold stays valued at its archaic price of $42.22.
It seems to me, that Washington knows what it is doing. I don’t think the individuals do, but the institution works well (kinda by accident). The `trillion dollar deficits` have been spot on economically. (Even the Fed has played a blinder). Tax income has been going up nicely. They may want to cut some spending, but `entitlements` are too contentious. There is plenty of slack in the `defence` budget (and I would love to know why that won’t be cut~?!) . Trouble may arise, when they `stop and think about it`; but there is no sign of that happening yet.
The US economy is the best of a bad bunch. The Eurozone economy is the worst. Why is it so bad~?…. Because we seem to be moving into a era of government controlled economies (and the Eurozone doesn’t have a government). Audio –