Toward International meltdown.

If we look at the US inflation rate, we get a misleading figure. While, the US is printing money as if there is no tomorrow, inflation rates are not rising in step (Top figure). Have the Obamabots figured out how to print money and not devalue it? For the short term, the answer is YES. The continued destruction of US banks and mortgage bonds simply holds down inflation. As long as the Obama regime is allowed to destroy private enterprise, inflation is delayed.

That does not mean that inflation is delayed everywhere, just that it is transferred over to the European scene. The second figure down shows the ratio of the Euro divided by gold price. We see this ratio rise. Since, gold prices have been steady and even falling till just this last week, what the graph reflects is the steep drop in Euro prices.

In turn, the price of the Euro reflects the brewing financial storm hitting Europe. On the fron line is the currency of Greece and Portugal that are being destroyed by vulture capitalists. Do we blame the vultures? NO! It is their nature to feast on carrion and the Greek currency is dead meat. Greece's debts have risen to unsustainable levels as the economy plunges and Greece's revenues (shipping and tourism) fell. Greek deficits are running at 13% annually (compare that to our 40%), so Greek default draws near. That will put Ireland, Italy and Spain on the firing line. The strain on the Euro is already heavy and you see it in terms of the Euro's price dropping.

Temporarily, European money flooded into the dollar, causing it to rise. [This may have been helped by the zombie banks buying up dollar contracts]. But, the dollar's days are also numbered. You can see it coming in the value of the 30 year Treasuries (note the head and shoulders forecasting a drop).

It is not surprising that US and European governments are unable to stem the tide of the coming currency failure and continuing sluggish economies. The prevalence of Leftist governments in the past had set the course of Europe and even the ocassional "Conservative" governments are unable to break the chains of Socialism foisted on the populace. Social Democracy is deadly and we see the results coming due. According to the Daily Mail, Soros and other hedge funds are plotting to bring down the Euro and after that the US dollar.

We can expect bonds to be slaughtered and nobody should remain holding bonds.

The estimated time table is to see further drop in the Euro, a devastation in the bond market and then a drop in the Stock Market. Gold prices should hit top in 2012. Hopefully, the radical Obama regime will be removed in 2012 so we can return to a sane economic policy in 2013 when the new President is inaugurated.