Gold For Bread - Video
This video just breaks my heart, especially the part with the small child scared and broken because he has no food to eat. This is what happens to a country whose government destroys the economy through monetary destruction. Twenty years ago Zimbabwe actually had a stronger dollar than the U.S. dollar. Today the money is as worthless as the paper it is printed on. There is no change in the countries people, or their production, but their money is worthless. They have to mine and pan for gold all day long just to buy a loaf of bread. This country has gone from developed to third-world overnight, all because of their central bank. A central bank that inflated the currency into a hyperinflation spiral.
Here's the scary part: inflating (or printing money) is exactly what our central bank (The Federal Reserve) is doing at an alarming pace.
What this chart shows is the unprecedented increase in Federal Reserve holdings of assets (namely AIG and other financials). But when the Fed buys these assets it doesn't use a store of cash from its vaults, it prints the money (or more specially enters the transaction on a computer) out of thin air. What happens is a major increase in the money supply, and according to the law of supply and demand this means the value of dollar has to drop due to the major increase of supply and no change in demand. Simply put, the Fed is causing every dollar in your wallet to lose its value. And with its recent actions, the possibility of a Zimbabwe like hyperinflation is becoming increasingly high.
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