The FED is on a mission of sorts. Well, maybe it is better tagged as a grand experiment. No matter where the financial problem lies, good ole’ Ben is there with a heap of U.S. Dollars, ready to give them away. Nice guy, huh?
Behind the scenes, it is known that backdoor bailouts by the U.S. of the European banks and sovereigns are being transacted as the U.S. Fed believes that money grows on tress. The truth is that if money did grow on trees, they would be bare by now. It is far better to have an alchemist at the wheel creating money from thin air these days.
So far, there has been little domestic inflation that has made anyone raise an eyebrow. But, with the most recent PPI numbers, that could change – especially when looking at the EX food and energy numbers.