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Inflation Is Going To Increase Very Substantially As A Result Of Money Printing

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Uploaded on May 30, 2009

Thu, 28 May 2009

Martin Hennecke, associate director at Tyche Group, explains why he thinks inflation will become a major problem and recommends precious metals and commodities to hedge against such inflation.

Two snippets from the interview:
"The banking crisis, the subprime crisis, hasn't been fixed at all, just simply transferred the problems from the banks to the books of the governments, especially in the Western countries. And now this is why the Federal Reserve has to raise, and the U.S. government has to raise such insane amounts of money --- 1.8 trillion dollars, is likely to be the deficit for this year. That's just the lower estimate, even Obama's government came out saying that [they] likely have to revise this due to the unemployment figures..."

"Inflation is going to increase very substantially as a result of all this money printing as they can't really raise all these funds that they need to raise for the bailouts and they will have to print substantial amounts of debt. Quantitative easing will get worse. As you have said, the Chinese are getting extremely nervous of this. We just had a projection from [the] Dallas Federal Reserve President, saying that the unfunded liabilities of the pension and healthcare in the U.S. is $99 trillion. So inflation is going to be a major issue going forward, so even for cautious investors, they need to invest just to protect their wealth. Gold definitely is one of the asset classes we like..."

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