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Economist Warns Fed Will Bring About Zimbabwe Style Hyperinflation
“100% sure” that the inflation rate will soar
Steve Watson
Infowars.net
Wednesday, May 27, 2009
A prominent PhD economist has warned that The US economy will be subject to rampant “hyperinflation” at levels rivaling those in Zimbabwe if the Federal Reserve refuses to raise interest rates.
Marc Faber, founder and managing director of Hong Kong-based Marc Faber Ltd., warned Bloomberg News that prices may increase at rates “close to” Zimbabwe’s gains.
“I am 100% sure that the U.S. will go into hyperinflation,” Faber said. “The problem with government debt growing so much is that when the time will come and the Fed should increase interest rates, they will be very reluctant to do so and so inflation will start to accelerate.”
Faber is well respected for accurately predicting both the financial crash of 1987 and the current crisis.
He has previously slammed the bank bailouts and has argued that fiscal stimulation will not work because the financial crisis was caused and prolonged by government intervention in the first place.
He also believes that the current crisis could be far worse than the great depression, precisely because of government interventions, and that eventually the U.S. will go bankrupt.
His latest prediction hits home when you consider that the inflation rate in Zimbabwe has risen to 231,000,000%, effectively rendering the country’s currency worthless and prompting it to print a bank-note worth Z$100bn, from which you’d be lucky to get change for a loaf of bread.
Hyperinflation has left at least 80% of the Zimbabwean population in abject poverty, facing mass shortages of basic goods.
Faber advised buying gold and told viewers he was adding to his gold investments.
Watch the full 5 part interview with Marc Faber below or a summary of his comments here:
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31 Responses to “Economist Warns Fed Will Bring About Zimbabwe Style Hyperinflation”
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May 27th, 2009 at 9:42 am
I had been assuming that hyperinflation was the goal. How can you implement a new currency and new governmental order if you have a sound dollar and sovereign country? I’m not a college educated man. I’m a forklift operator. And if I can see the recipe for inflation without help, I am sure that the men with serious backgrounds in business and economics can see it, they simply have a different goal in mind than you would like to believe. Anyone care to speculate how many men in our government ought to be hanged for treason?
pitofdoom Reply:
May 27th, 2009 at 10:07 am
I’ve put a call into France to find out the rental cost on the guillotine thingie….
And if there’s a discount if we return it sharper then we got it.
Jedi Pauly Reply:
May 27th, 2009 at 11:06 am
I love it!
artsy Reply:
May 28th, 2009 at 4:07 am
i’m from canada…can i borrow it when you’re done?
Bigger Bear Reply:
May 29th, 2009 at 1:33 am
Well, did you know, that – according to William Cooper’ research – Joseph Ignace Guillotin had been a Freemason? After him the Guillotine is named, since he supported it as a human form of … blood sacrifice … ehm “punishment”.
Instruments of mass-murder were usually not invented and used by the people, but by the elite and the governments; in the case of the French revolution, it was the coming government, the new old ancient regime. So don’t think you can get rid of the beast by chopping of it’s heads, since they constantly keep growing from inside the body. The ONLY revolution in a Christian sense that I see on the horizon as sustainable and in favor of “the people”, is that of Gandhi. I currently live in India, where Gandhi’s former party (Congress) has just won the elections. Well, though this doesn’t mean too much, India still seems to be a strong democracy…
So please protest actively and resist, but don’t get violent! Nice joke though;-)
Wez the Aussie Reply:
May 27th, 2009 at 10:52 pm
Why stop at just the ones committing treason? Politicians commit crimes across the entire spectrum. I, probably unfortunately as a human being, would love to see ALL the politicians in Canberra, swinging from the light poles by a rope around their necks.
AlteredState Reply:
May 28th, 2009 at 12:35 pm
They should all be hanged for treason. When will we do it? That’s anybodys guess.
May 27th, 2009 at 10:00 am
6 million
igigi redpill Reply:
May 27th, 2009 at 4:41 pm
Well..marine, 6 million sounds a bit excessive.. 300,000 to 500,000 would be an impressive display of restraint.
May 27th, 2009 at 10:01 am
All that’s left is the entertainment value of watching all
the fait (monopoly) currancies roasting on the barbie…
May 27th, 2009 at 10:23 am
HERE: Stream and Download ALL the best interviews and rants from the Alex Jones Show Archives:
http://alex-jones-archives.politicsfiles.info/
Backup your favorite episodes, don’t miss any!
May 27th, 2009 at 11:07 am
The FED prints the money.
.
The FED GUARANTEES the money.
.
ERGO, the FED will back the money, regardless the situation.
.
And if the FED won’t?
.
Then the FED (the World Bank) can’t guarantee the Euro either.
.
If the FED WON’T back THE VERY SAME DOLLAR THEY PRINTED, THEN NEITHER IS THE EURO WORTH A PLUG NICKEL!
.
May 27th, 2009 at 11:57 am
Perfect solution for HYPERINFLATION:
Just before start of inflation You take a maximum bank loan and buy any solid stuff.
During hyperinflation You repay whole loan with only equivalent of one loaf of bread.
And whole other stuff will Yours.
May 27th, 2009 at 12:22 pm
THE very cause of hyperinflation is unpayable interest rates.
In Weimar the interest rate rose to 900% in less than a year.
In Zimbabwe, the interest rate was 800% and the overnight lending rate was (may still be) 10,000% (ten thousand per cent!). Treasury securities were at a rate of 66% requiring their Government to raise the peoples taxes to over 70%! If you are a shop keeper in Zimbabwe and you have a loan, and the interest rate is 800-900%, and taxes over 70% in an market where unemployment is 85%, how often do you have to raise your prices to stay in business? A: several times per day. Therefore, hyperinflation.
Please DO NOT raise the interest rates to avoid hyperinflation. The money supply available for commerce (not to banks) is drying up and businesses are closing.
If the Fed raises interest rates to combat a boogie-man type inflation – then the cycle can start.
Trouble is, most of these so call “experts” are working from a flawed model.
They have no mathematical way to describe a debt-only money system where the money to pay interest is never created and the principal payments are “extinguished” (Federal Reserve’s own language; PURPOSES AND FUNCTIONS, 1963, 50th Anniversary Edition). Just think of it!! Principal payments extinguished when the payment is made. And then they hike interest rates to boot – what do you suppose will happen to the money supply? One reason the “experts” are suggesting the wrong policy is that they are following the wrong model.
PS: Highlander, the Fed does not print money – sorry. It is a myth (that’s why it’s on the news – “programmed response”). They do, however, loan it out after the BE&P at the Treasury prints it (at a cost of less than $0.05/$100 bill). The obligatory printing press that you see on the evening news is a diversion. Most of the money we use is electronic bank credit (digits) and not paper (much of the paper is over seas). The presses role, primarily to replace worn currency.
For some answers: moneyaswealth.blogspot.com
Austrian School=robber-baron economics Reply:
May 27th, 2009 at 11:20 pm
You’re absolutely correct!
The problem is *not* that the interest rate isn’t high enough, nor (as Austrian School propagandists would have everyone believe) that our paper currency isn’t “backed” by a commodity or precious metal.
The problem is that all money is *issued* as an evidence of interest-bearing *debt* expansion instead of as an evidence of interest-free *wealth* expansion; that it vanishes from the money supply whenever bank loans are repaid; and that the money needed to pay the usurious interest on these fraudulent loans is never created in the first place (the consequence of which is that there’s always a built-in *shortage* of money).
Thus, the real solution is to simultaneously
* put all derivatives-infected mega-banks through Chapter 11 bankruptcy and, in the reorganization proceedings, legally void all of their derivatives contracts;
* liquidate all of the ill-gotten assets of criminal scam artists like Henry Paulson and Bernard Madoff, and use the resultant proceeds to help replenish whatever retirement funds they raided; and
* replace our current debt-based money system with a debt-free (or modern-day “Greenback”) money system, whereby all new money — instead of being *loaned* into circulation at interest — is *spent* into circulation at *no* interest to fund the production and repair of public goods everyone can see and benefit from (e.g. roads and bridges), and at a rate pegged by law to objective criteria such as population growth and the general price level.
More on this at: http://propagandamatrix.com/fo.....pic=1012.0
May 27th, 2009 at 12:35 pm
By the way, the entire Zimbabwe ordeal was orchestrated by banks to take over Zimbabwe’s mines of precious metals and diamonds.
Post callapse of the Zimbabwe economy, the banks came in and bought the mines at pennies on the dollar and then laid off the workers and let the mines fill with water.
Could that have been to control the supply??
Zimbabwe is rich. The banks have made them poor. I heard millions starving.
Minnesota has a bill that could fix our broken economy: HF888
The concept could fix the Social Security problem as well.
May 27th, 2009 at 1:32 pm
Minnesota’s bill being able to fix the problem, haven’t read it yet so this is not informed as to it’s content, might actually be why it won’t be enacted. Fixing the problem isn’t really the goal is it? After all, when Bush first told congress of the bailout plan, their phones were flooded with calls saying NO. They did it anyway. The average person on the street knew better, as did the congressmen who were unwilling at first to go along with it. So, since it was passed anyway, with Obama and McCain’s help, what makes you think fixing the problem is the goal? Perhaps it is all moving right along just as planned. A good thing actually. I think that most people are unduly worried about the inevitable confrontation. We patriots are far more effective than one might give us credit for in fighting authority. It’s more our heritage than submitting to slavery.
May 27th, 2009 at 2:21 pm
I work on wall street and I have been trying to tell as many investors as could about this way back in January. I said you better buy all the gold you can. Nobody listened. I could see this a mile away. Get ready cause here it comes. One loaf of bread costs a days pay. Bible said its coming.
May 27th, 2009 at 3:46 pm
I can afford a whole bakery then.
May 27th, 2009 at 4:31 pm
Look, people; learn how to forage for all the wild food in the woods and fields like the indians did when there were no grocery stores. The SWAT teams can perform food raids, but they can’t raid your knowledge. Then, pass what you learn to your kids.
11eleven Reply:
May 27th, 2009 at 6:13 pm
well, we better set up camps to train people how to do this, because most people don’t know how to do this, and it will take them a year to learn how to do this, provided they have weapons. Which most people don’t . They will starve. We have to get on the ball and start training people how to survive for the “day after” scenario.
steve Reply:
May 27th, 2009 at 7:47 pm
I live in LA dude, what am I gonna do to forage for food? LOL.
I have a 3 month food supply and then after that my plan is to eat cats, dogs, and then move on to homeless people and slow fat children. Although I would probably eat slow fat children before homeless people due to hygiene issues.
Cannibalism here i come!
May 27th, 2009 at 4:48 pm
Dollar will be toast in maybe 3,4 years IMO
What the heck is a consumption based economy anyway? I eat food for a living?
I keep hearing economists say this. Nice job if you can get it I guess.
steve Reply:
May 27th, 2009 at 7:53 pm
It means we don’t produce anything anymore. All we do is consume. We have service sector jobs and government jobs. Our economy is reliant on the constant transfer of money to fund the money machine, its basically reliant on an every growing consumer debt. An economy like that is doomed. During the great depression we had tons of factories producing real goods. We had textile facilites, glass factories, steel works, you name it. The last big industry we have, the auto industry, is on its last legs. We are screwed.
May 27th, 2009 at 9:47 pm
You aren’t screwed… but you are while you continue to believe in the economic slave system based on ‘needing to aquire money to live’. I do not believe you can think your way out of this box, which is shame because therein lies the answer. I hope and pray I get proved wrong. You do NOT work for money. You work to obtain product. By keeping product scarce they enforce slavery. An example is the ecoloblue water system. If everyone had such a system no-one would need this sector of infrastructure. But as it is they can serially bill you. Do you see? They have kept water scarce via controlled centralised distribution. This is not a boon for anyone, it’s extortion. A sensible government would ensure it’s citizens are independant for every basic need. It’s entirely possible. But of course they won’t and don’t because that would represent a loss of control, a loss of willing slaves and a halt to their nefarious projects. You are enveloped in the matrix and belief in ‘earning’ money is one of the main tenets keeping you there. It’s BULLSHIT. But I understand slaves clamour for work and jobs. It’s all they know and all they can perceive. Shame. You could ALL be living your lives as you see fit but instead you slave for this scum based on their imposed scarcity. It’s laughable and economists support this nonsense. Don’t believe any of them.
May 28th, 2009 at 1:10 am
I shall watch the tapes today with great interest. But as a psychologist with experience in Zimbabwe, my gut instinct is that this will not NECESSARILY happen. After all the economists said Zimbabwe would boom when the psychologists said it was on a precipice.
The key to the Zimbabwe story is the strain on public service leading to political exasperation and then the collapse of the tobacco industry.
Herein lies the kicker. How quickly could we a) involve more people in the economy b) shift our dependence to another industry.
Exactly the same questions are relevant in the States. Share the prosperity or expect a backlash. Emphasize new growth industries. Fail on either count and your economist is right.
Obama’s direction is correct ,if Zimbabwe’s experience applies. What counts now is execution. Get behind growth with equity. Any short term losses will be trivial compared to what you could ultimately gain or lose.
May 28th, 2009 at 5:39 am
Yes this could happen here, not only because of the Fed, but because we are importing third-world PEOPLE by the boatload. People create cutlure. The key to the Zimbabwe story, besides the money system, is the word that dare not be mentioned – race. I’m a big fan of Alex and I know he doesn’t feel this way, but the fact is if you let third-world people be in the majority and in charge, you get a third-world nation. Zimbabwe used to be the bread-basket of Africa. Look it up. Then Ian Smith and the ‘liberals’ gave the nation they built away to the masses – and look what happened.
Although the liberals have done their best to define any sort of racial consciousness as ‘hate’, I do not hate anyone and wish every race and culture God’s best, but this Babel we are building will fall. I am not for eugenics or mistreatment of ANY person, but I am also against this mass, politically-correct, movement that seems to be slavering at the mouth to exterminate white people from this planet (except for the Anglo-elites of course… they still get to live in their off-shore compounds).
Peter
May 28th, 2009 at 7:22 am
Peter, you are wrong! 5% of the European Colonizers descenders owning 80% of the fertile Zimbabwe land! Where is the justice? Its the international banking cartel (of course very much led by the Jews) that destroyed Zimbabwe! I am afraid you are among the many people that have fallen into the “deception mind control”. The bankers now have you in their pocket-they will get your race next unless off course you are not goy!!!
May 28th, 2009 at 11:38 am
true or not, heard on ssb yesterday,27 May, that the u.s. state dept has told all u. s . embassys to buy the currency of the respective country for one years operating expense and the suspense date for this action was within 150 days or 5 months. lets see, june to october, hummm…. i always wondered how paupers felt, looks like i.ll find out.
May 28th, 2009 at 6:01 pm
i dont believe any of this shit the market is getting better and will within the next year or 2 these people saying depression this and that yea we came close but thanks to our government we are slowly coming out of the woods and we will be ok. See this is what is happening our nation is at the end of an era and at the beginning of new one. Our countries infrastructure is from the 50s and 60s our dependency on foreign oil is in the process of changing so we can use solar and wind power and bio fuels and that is just to name a couple and during this transition phase we are going to see lows and highs until eventually probably around 2011-2014 is when we will see things starting to even out a bit.
May 29th, 2009 at 5:06 am
Whoa. Not so fast says the world’s leading expert on America’s depression. According to Mike Stathis, Faber is a perpetual doomer, who much like Peter Schiff and the others, has been preaching the same doom lines for 20 years in order to help their own investments. As such, they have no credibility.
These doom extremists, Stathis adds, are actually worse than the bull market extremists. Stathis predicted the current depression with more accuracy and precision than anyone else, yet he emphasizes the need to know when the tide turns, if even short-term so you can make money. And following his expert market guidance has made me a lot of money. http://www.avaresearch.com/art.....s-208.html
Faber is just another one of the Jewish so-called experts the Jewish media goes to AFTER the market collapsed as a way to fool you into thinking they are on your side. You guys would be wise to start reading what Stathis has to say. The media has black-balled him in order to preserve thier own agendas. http://www.avaresearch.com