Jim Rickards: Extremely High Risk of US Dollar Collapse

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HRN: Bernanke has been in the media, saying that inflation will stimulate the U.S. economy and help create jobs without causing prices to go up.

Jim Rickards: It’s propaganda. I had a discussion with former Fed governor, no reason to mention the name, who is a very well known economist, and what he said was that behind closed doors the Federal Open Market Committee spends about 10% of their time on policy and 90% of their time on communication. They very quickly arrive at what they’re going to do and then spend the vast majority of their time thinking about messaging and wordsmithing. Well, there’s a name for that. It’s called propaganda.
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So the Fed (is engaged) in all of these monetary exertions, mind games, it’s manipulation. They are not trying to communicate with you honestly. They are trying to communicate with you in such a way that they manipulate your expectations into doing something that may or may not be in your best interest.

By the way, the more the Fed does this the more we get to a point where confidence in the dollar may collapse. It could happen very suddenly...The stage will have been set. It’s like my metaphor of the avalanche and the snowflake. The avalanche is waiting to happen, but it takes a certain snowflake to trigger the whole collapse of the mountainside.

What we have now is an unstable mountainside and the snowflakes are coming down and it’s probably a matter of time. We are running the risk of a dollar collapse with a much higher probability than anyone should be comfortable with. So this just increases the case for gold in my view.”
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RAY DALIO: ...
We can`t solve the problem easily because we still have too much debt. But we can move forward in being able to make the best of it. We can spread it out, we can keep orderly we have a situation now in which we have a very severe situation, not only because we have a deleveraging going on, but we have a situation in which monetary policy cannot work the way it worked in the past, that fiscal policy will not be stimulative.

CHARLIE ROSE: Some people say that they describe that as there are no more tools in the tool kit.

RAY DALIO: There are no more tools in the tool kit.
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James Rickards, a top adviser for the Pentagon and CIA, is sounding the alarm that America is on the brink of a global “financial war.”
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