As noted in yesterdayâ€™s essay, Bernanke and palsâ€™ claims that the US is in a recovery due to the fact the stock market has rallied are totally bogus. Bernanke is measuring his success in US Dollars, which incidentally happens to be a ruler that he can continually shrink with his policies
Much as someone might claim theyâ€™ve grown in height because they use a shorter ruler to measure themselves every day, Bernanke claims that the stock market is up because itâ€™s priced in the US Dollar (which is losing value almost every day).
Itâ€™s completely absurd, and yet itâ€™s the basis for each and every one of Bernankeâ€™s claims that the US is in a recovery. Nevermind, that employment is falling like a brick or that food stamp usage is at an all time high, the S&P 500 is up since March 2009, so things must be improving right?
Many supposed gurus claim that investing in stocks is a great way to hedge against inflation. The data doesnâ€™t support this claimâ€¦ at all. During the â€˜70s stocks traded in a large range for 10 years. Unless you timed the bottoms and peaks perfectly, most â€œbuy and holdâ€ folks didnâ€™t make anything in these years.
And once again, this is priced in nominal terms. When you price stocksâ€™ performance in Gold for the 70s itâ€™s positively abysmal.
Just like today.
So instead of bemoaning Bernanke and his policies, why donâ€™t we all do something about it? I didnâ€™t vote for this guy. None of us did. And yet weâ€™re all paying the price (literally) for his policies.
How do we vote against him? Simple. Buy Gold and DONâ€™T buy stocks. Donâ€™t fall for the â€œstock wealth effectâ€ BS and instead invest in something the Fed CANâ€™T devalue.
Because in the end, doing this means buying an asset that is INCREASING your purchasing power (Gold) and avoiding one that is DECREASING in purchasing power (stocks).
And of course, it has the side benefit of not providing Bernanke and his policies with ANY vote of confidenceâ€¦ or support.
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