Submitted by Deepcaster:
February 16, 2013
Everybody talks about what they are not going to do, which is exactly what they are going to do. –Jim Oberweis, Oberweis Investment Management, 02/12/13
G-20 Pledge to Refrain from Competitive Devaluation – DRAFT”
Yes, indeed, Mr. Oberweis. The Major Powers have begun a Competitive Currency Devaluation “War” = Phase 2 of the Ongoing Financial Crisis. But this War has only just begun. This is why the G-20’s “DRAFT” Pledge, while it may be agreed to, will never be implemented.
When, not if, this War starts to Rage out of control in the next few months, that will mark the beginning of Phase 3, which is inexorably approaching. Investors and Traders alike must be prepared for Phase III.
And those Investors and Traders who have prepared for Phase 3 can get rich, while those who are unprepared will be devastated.
Phase I, now in the process of ending has been marked by Sovereign Debt Hypersaturation among nearly all the World’s Major Fiat Currency Powers.
Not just the PIIGS Nations, but also France, the U.K., Japan and the U.S.A. have Debts which can never be repaid given any sustainable rate of Economic Growth and Taxation System. (Even China has a Debt Saturation Problem, though they have more resources than most to cope with it.)
So their Central Banks (and, consequently, others) have begun a Race to Devalue their Currencies (Phase 2) vis á vis each other.
But as those nations with overvalued currencies experience the pain from, e.g., diminished Exports; they are impelled to devalue even faster than their fellow G-20 Members. And thus the Currency Devaluation War is intensifying and spreading far and wide – Venezuela recently joined the “Devaluation Club.”
Thus we have the intensifying “War”, which is really a Race to Major Fiat Currency Purchasing Power Degradation, that is, to Price Inflation, then; when the Currency Devaluation War spins out of control, Hyperinflation (e.g., the U.S. is already Threshold Hyperinflationary with CPI at 9.4%, (per shadowstats.com).
Thus The Race to Phase 3, Hyperinflation, has begun.
In this Process, it is critically important not to be misled or deceived by Participant Governments, Central Banks and other Mega Banks’ False or Misleading Claims.
Savvy and Experienced Jim Sinclair provides an excellent summary of what can not happen going forward, despite the aforementioned Big Boys Claims to the Contrary.