Prophecy in today's headlines

If You Think the Dollar Is Doomed, Read This

Warren Buffett has been called a sage, an oracle, and a genius. So when he says something as startling as the following, your ears should perk up: “In the future, I would predict that the U.S. dollar will decline. … Force-feeding the rest of the world $2 billion a day is inconsistent with a stable dollar.”

This is scary stuff. Except one thing: Buffett made that statement at the beginning of 2008, before (1) the U.S. dollar went on to have a pretty good year versus most other currencies, (2) the U.S. government announced the $800 billion bailout and $789 billion stimulus that will force-feed the world billions of additional dollars of U.S. debt, and (3) China’s central government proposed replacing the U.S. dollar as the world’s reserve currency.

Passing on the buck

Now, we’re not policy wonks, Ph.D. economists, or long-winded talk-radio hosts, so we’ll leave the politics aside and focus on the implications for your bank account instead. By adding to our massive federal deficit, the TARP and the American Recovery and Reinvestment Act of 2009 could have a devastating effect on the

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