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financialsense.com / By Richard Russell
The following is an excerpt from Richard Russell’s Dow Theory Letters
“Political power grows out of the barrel of a gun.” Mao Tse-Tung
The US national debt is now over $16 trillion — and growing at the rate of more than $1.2 trillion a year. This is clearly unsustainable. But how to cut the debt? One way is to cut entitlements, which are growing exponentially. Will they cut Medicare? Cut food stamps? Cut any entitlements at all? No politician would dare make extensive cuts in entitlements.
OK, then raise taxes sky high for everyone, and I mean for everyone. Are you kidding? If we raised everyone’s taxes to the hilt, that still wouldn’t solve the US’s deficit problem. Furthermore, no politician would dare vote to raise taxes sky high!
Really, then how are we going to solve the debt and deficit problems?
It is not going to be solved. The temporary “solution” will be put off for as long as our pols can put it off. But how will they put it off? It will be put off in only one way — by devaluing the currency. And surprise, that’s what they’re doing now.
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2012-10-06 11:43:03

Source: http://totalinvestor.blogspot.com/2012/10/the-only-way-out-is-to-devalue.html