What will be the outcome of the stimulus/bailout charade?

After completing my MBA in 2005, it was then that I really began to learn about finance & investing.  In four years, I have only seen a glimpse of what’s out there.  Because Utah has such a high rate of fraud, particularly financial-related fraud, I have been fortunate enough to have seen a lot of “pretend” investing.  (I say fortunate because I think seeing others make mistakes is the best form of learning).

Although I feel that I’ve learned so little about investing and finance in my education in school and in the real world, I have still been looking around at the stimulus/bailout and asking myself,“Is it just me or does this just not make sense?”

I have felt confused like this before, mostly when seeing friends and associates around me getting involved with an investment or other money-related scam. The fundamentals seem to be completely absent, and it feels like things are going to crash land.

When I hear about the various measures of the stimulus/bailout, it just seems inevitable that hyperinflation will set in eventually.  Look what happened in France with its fiat currency in the 18^th Century, and even as recent as 2001, the Argentina peso crisis.  Because the financial labyrinth of the 21^st Century is yet unprecedented in its complexity of illusion, it is difficult to imagine the outcome.

A good analogy of what is happening with the stimulus/bailout is that of two mirrors facing each other with a dollar bill being held up in between the two.  The illusion is that there are an infinite number of dollars there. This is the same illusion that is being played out with the U.S. Dollar in the world financial arena.

Any thoughts as to what the result of this charade will ultimately be?

Posted by Corey Curwick on May 17, 2009