On the TAPER.
It's funny how we think the Feds can actually stop the taper and not replace the printing with something else. With the next years committed expenses we are $18 Trillion in debt. The Feds are buying our debt because no one else will in the quantities needed. The Gov. only collects $1.1 Trillion in income taxes of its people. To service our debt costs roughly 3% or $540,000 billion a year, but this figure is cheap based on historical averages. For every 100 basis points(1%) the treasury interest rate rises, the peoples must come up with $180 Billion or 16.36% addition income taxes.
Historically, rapid rate of inflation equals higher treasury rates, economic slowdown or recession, depression equals lower rates. So too will be the amount of taxes generated washing the system to an equilibrium. Our problem is as far as the eye can see, is we are burdened with $1 Trillion in deficit spending annually. This means a 9% increase in taxes annually or a lower standard of living, we get a mix of both currently and some off setting of higher fees/taxes for businesses who haven't fled the country. This in turn causes unemployment and reduced wages.
So when it comes to stopping the QE/printing, like Peter Schiff says , it ain't happening, something WILL replace it.
Since Congress refuses to balance our budget, we as individuals must prepare ourselves for continued reduction in our standard of living. This is not so easy as our Freedoms are being suppressed on a weekly basis. Land and metals are hard assets they just don't make anymore and we see people flocking to them. We have all heard the rich buy income producing land and how some Tom Dick and Harry are buying precious metals (fact, PM sales are through the roof globally).
In the end, I can make gun powder, grow food, desalinate the ocean or capture rain but I sure can't grow an Island or create Gold/silver out of anything.
So the next time I hear someone say, oh yeah the taper will end, excuse me if I giggle because it is mathematically impossible, or when someone says PM's are stupid to own in a physical form...carry on, I enjoy the discount !