Charles Evans, the Chicago Fed President, effectively announced QE4ever. He is Bernanke’s right-hand man. Not only $40 Billion per month is to be committed for purchases, but an additional $45 Billion per month will be committed. $540 Billion will be committed by printing new money and this translates to a currency war in order to depreciate the US Dollar. Interest rates are at zero, the inflation rate is above 8%, and pension funds are seriously underfunded. This is an all out assault on the US currency. Bernanke is destroying the senior citizens and savers of this country.
The biggest challenge savers have now is how to move cash to assets that will not depreciate with the US Dollar. Gold and silver are the obvious alternatives. Related stocks are not far behind. Retirement funds locked into bonds are at high risk. If and when the bond vigilantes show up to challenge the bond rates, epic losses in bond portfolios will occur. Pension funds will suffer great losses and pensioners will curb their spending further thus exacerbating the problem further.
The stated reason for QE4 is to get unemployment down. The problem is that it is structural, not cyclical. The excesses of the the boomer generation over the last thirty years created a non-cyclical sustained growth that could not be further promoted by the X generation. The 25-40 million abortions assured us that the X generation would not have enough population to continue the growth. The sins of the people are now coming home to roost. The economic famine is upon us and the Fed will throw everyone under the bus in order to perpetuate its agenda. My… it will get crowded under there.
Silver is currently 50:1 ratio to gold. As people flee to metals, I expect this ratio to move back to the historic 16:1 ratio. $3,600 gold would translate to $225 silver. Will it reach these numbers? Only Our Heavenly Father knows!