[escapee]

2 words : PROTECT YOURSELF

The Crack Up Boom Part VIII - The Reflation Dam has burst / Ty Andros!

In conclusion, the demise of the dollar will take a huge leap forward as the US Government bailouts MUST materialize over the next 9 months as no one else will PLAY the FOOLS. Look no further than today's bankruptcy of Lehman and the sale of Merrill to Bank of America. Lehman's capital raises are TOAST and Merrill's is a disaster, but at least they get something for the retail business they have. Morally and fiscally Bankrupt G7 governments will just print the money to save the financial and banking systems as there is a diminishing source of it from investors. Globally, investors have the money but as the old adage goes, "fool me once, shame on you, fool me twice, shame on me." The money that is being used to adjust the portfolios of Middle Eastern interests will return to their previous trades after the political realities are addressed. The greatest reflations in history have just begun. Can the dollar rally further? Sure it can, there is a shortage of them in the G7 financial and banking systems to service the debts, so you can bet they will PRINT MORE OF THEM!

The Fed today has radically expanded the term lending facilities, both in size and eligible collateral, such as common stocks. Congress is frozen like a deer in the headlights by election considerations, a group of lawyers who know NOTHING about economics, cowards until they are secure for another term rather than the fiduciary stewards they claim to be. They don't think of the public's needs during trying times, rather they think of their own and do imitations of OSTRICHS! Short term rates (fed funds) WILL fall as predicted, possibly to almost ZERO. When Washington Mutual goes under so does the FDIC (the Federal Deposit Insurance Corporation only has $50 billion and Washington Mutual will be at least $40 Billion). A G7-wide banking sector BAILOUT needs to be commenced immediately. The system DOES not have enough capital, many of its components are INSOLVENT, and capital MUST BE injected by the central banks and their governments.

The money necessary to RECAPITALIZE the G7 financial and banking systems has disappeared due to the terms of the Fannie and Freddie bailout and the NO ACTION in the case of Lehman Brothers. The Fed and Treasury tried to halt the moral hazard by saying no to Lehman, but the time to do so was years ago, so instead it is the match that ignites the dynamite. Since the G7 banking systems have large parts of them which are insolvent, the governments and central banks will be forced to PRINT IT in one form or another. Creating trillions of new IOU's called G7 currencies in addition to those that have already been created. The G7 economies are in virtual collapse due to LACK OF FUNDING AND CREDIT, so expect the greatest REFLATION in history to EMERGE. The collapse in income outlined in the WOLFE wave is continuing, creating additional demand for the printing press. You name it: cities, states, auto and airline industry, the recapitalizations and bailouts have JUST BEGUN! It's inflate or die time...