Any so-called asset whose value, based on historical precedent, is destined for zero is therefore destined to die. From Matthew Piepenburg at goldswitzerland.com:
Below, we look at four deliberately ignored reasons why extreme liquidity is drowning paper money.
Reason 1: The Taper Debate May Not be a Debate at All
Here, we look past the taper headlines and ask a simple question: Would a Fed “tapering” of QE really matter?
As we’ve written elsewhere, the Great Taper Debate is less of a debate than it is a pundit circus, forever fueling now classic yet complimentary debates on inflation vs. deflation, gold vs. the dollar and Fed-speak vs. honesty.
Of course, such topics, including the great “taper,” are all critical issues worthy of opposing views and somber discussions.
The world needs open, transparent and respectful (as opposed to tyrannical) debate, now more than ever.
If the Fed, for example, were to taper money printing, it’s logical to assume (and argue) that this would mean falling bonds, rising rates, deflationary forces, a stronger dollar and massive headwinds for risk assets like stocks and real estate.
But for many who are not otherwise deeply ensconced into the weeds of Wall Street (i.e., normal, smart and conscientious investors), what they may not know is this: The Fed has other tricks up its liquidity sleeve than just “QE.”
Stated otherwise, the taper fears as well as taper debate may not be as central to the central bank debate as one might think.