With the yet again recent move by the US Feds to increase the money supply by buying up mortgage backed securities..we vomited when we heard that news. The US is in a big mess...it seems they are operating in an environment where every action they take is a struggle between politics and pure economics logic. Don't get us wrong...we think what the Feds are doing are logical from a public administration standpoint, but it is disastrous from an economics point. Anyway, SGDividends is ultra bearish on the US dollar and thats our personal opinion. It just makes perfect sense. In layman speak, the above chart is basically showing how fast and speak, the above chart is basically showing how fast and furious the US Feds have been buying securities ( mortage-backed,treasuries, e.t.c). When the US Feds buy securities, they use US dollars to pay for it, therefore, effectively increasing the money supply into the system. Don't you think the spike is kinda scary? To understand what gibberish we are talking about, one needs to understand the purchasing power of cash. It refers to the amount of real goods and services that a person can buy with say $1 fiat money. Therefore, its not correct to measure whether one has become wealthier by looking at one's bank account, its more important to see how much goods and services one can buy. See the second chart above. A bit on the history of money so that one can have a firmer grasp on why we say the USD dollar is crumbling and appreciate the situation better. ( Anyway, who says history is a useless subject in school...we will punch you . Its has helped many people make serious money.. ) Read more...