From the December 2004 Idaho Observer:

Fed chairman baits foreign investors to dump greenbacks

Greenspan foreshadows imminence of U.S. dollar crash

During a speech before the European Banking Congress in Frankfurt, Germany November 19, Federal Reserve Chairman Alan Greenspan acknowledged that U.S. dependence on foreign capital to finance its burgeoning public debt does not bode well for America’s economic future. "Given the size of the U.S. current account deficit, a diminished appetite for adding to dollar balances must occur at some point," Greenspan said.

In the last two years, China alone, in an effort to preserve its export market in America has purchased nearly a $trillion of U.S. debt in the form of U.S. bonds. One could even go so far as to say that China is inadvertently financing U.S. military operations in the Middle East.

According to Robert Manor of the Chicago Tribune, Greenspan said that foreign investors could "tire" of financing U.S. debt (and U.S. imperialism) which could cause them "…to unload their dollar-denominated assets, such as U.S. stock investments, and put their money in other countries."

"International investors will eventually adjust their accumulation of dollar assets or, alternatively, seek higher dollar returns to offset concentration risk, elevating the cost of financing the U.S. current account deficit and rendering it increasingly less tenable," Greenspan said.

The U.S. Senate reconfirmed Greenspan, 78, to an unprecedented fifth term as Fed chairman without dissention. When Greenspan took control of the nation’s money supply in 1987, the national debt was at about $2.35 trillion. As of June 17, 2004, the date of Greenspan’s uncontested appointment to a fifth term, the national debt had increased to $7.226 trillion.

In essence, Greenspan was in Europe telling the European banking and investment communities to back away from the U.S. dollar crisis that he played an active role in creating.

According to Manor, "Greenspan said there is little sign so far that overseas investors and central banks have lost faith in the U.S. economy, his warning rattled Wall Street and currency markets."

The dollar responded almost immediately by dramatically losing value against foreign currencies. Nearly a month later, the dollar continues to decline on the global market. And there is no end in sight.

Should overseas investors and central banks reduce their U.S. investments or begin divesting themselves of U.S. dollars, it would cause stocks and bonds to sink and interest rates (and commodities such as gold and silver) to soar.

Though the dollar’s decline has been gradual thus far, Greenspan’s comments indicate a willingness on the part of the Fed to help hurry the dollar’s decline along.

Ironically, on the same day at the Asian-Pacific Economic Cooperation summit in Santiago, Chile, President Bush commented that the U.S. dollar was strong and the U.S. economy was doing just fine.

Something is going on

Even the most disinterested and mindless American consumer senses that things related to their "money" are changing. Silver and gold are way up and their paper money just doesn’t buy very much anymore; most anyone can have several credit cards and it is becoming a bad habit for many Americans to pay their monthly bills with them. The article above contains insights which indicate that a cataclysmic economic "correction" is imminent. Mindlessness will not fare well during and after such an event.