The main cause of hyperinflation is a massive and rapid increase in the amount of money which is not supported by growth in the output of goods and services. The UK Column has been warning for a number of years now that we are staring hyperinflation in the face. So where is it?
It's there.
It's there in the half trillion Euros pumped into an already dead European financial system at Christmas by the European Central Bank. It's there in the half trillion Euros that the ECB is going to pump in next month. It's there in the trillions upon trillions of dollars pumped into the system by the Fed, and the hundreds of billions of pounds pumped into system by the Bank of England.
Positive Money bills itself as “a simple solution to the debt crisis”. With a cursory glance, it might appear to be making some of the right noises. On closer inspection, however, there’s just nothing there.
Positive Money states that it wants three things:
1. Make banks ask our permission before they gamble with our money.
As I write this, in a real sucker punch, the FTSE is up 10% so far today. Hooray, the world is saved!
Or not.
What could be behind this insane, hysterical reaction?
One reason is that late yesterday, the FSA called a halt to short selling of financial stocks in the UK. As a result, many (t)raders have had to get themselves out of short positions. That musta hurt!
The second, much bigger, reason is that the US Treasury Secretary, Hank Paulson, in collusion with the US Congress, is about to commit an act of blatant treason.
