Let's be very specific:

What REALLY caused the Great Depression? Contrary to popular opinion, Herbert Hoover- falsely accused- had little to do with it.

On October 29, 1929, Congress passed the Smoot Hawley Tariff - the same day of the infamous Wall Street Stock market crash. 

Actually, Smoot Hawley had NOT been designed to protect U.S. manufactured goods:

It's implementation arose from heavy pressure by American farmers, whose exports - although booming during the early 1920's - began falling with the resurgence of European agricultural producers, who'd finally recovered from World War I. 

Also in 1929, Europe's economy was rapidly declining, causing Germany to default on its (Treaty of Versailles) war reparations' payments to the Allies.

After the German default was announced, panicked European money traders began converting their English pounds into gold. After an 18-month run, Britain's gold reserves were approaching danger levels.

Thus, in early 1931, the Bank of London  announced it would no longer peg the British pound to the price of gold. The pound promptly fell in value by 20%.

Now the real American crisis began to unfold.

A less-valuable pound made British exports more competitive, because they became cheaper in foreign markets; this caused U.S. products to become more expensive overseas, and American exports of manufactured goods "fell off the table."

This sudden decline in exports led to rapid job losses in the U.S. manufacturing sector, and concomitantly, American farmers were also going under. 

By September 1931 - with Britain having abandoned its gold standard - foreign depositors in large New York banks, fearing America might follow suit, rushed to convert their cash deposits to gold.

Now the effect began to snowball all across America.

Sudden withdrawal demands in metropolitan areas started a massive panic, as banks everywhere were suddenly bled dry of gold deposits.

By the end of 1931, a liquidity crisis had caused the failure of 2,300 banks.

In late1932, there was near-panic, reaching its peak in March 1933, when new president Franklin Roosevelt decared all banks closed for a four-day holiday.

Hence it was "demon gold"- initiated by the protective policies of the Bank of London- that actually opened the door to the Great depression; and Smoot Hawley, along with the hapless Herbert Hoover, have needlessly shouldered much of the blame.

But history remains accurate in maligning the Federal Reserve for its deflationary, high-interest rate policy of the 1930's, which PROLONGED - not caused- the Great Depression. 

Today, Fed chairman Ben Bernanke claims he is a student of all this; and remains confident that by taking the opposite tack (zero prime interest rates) he can prevent a second depression, with an expansive - rather than restrictive - monetary policy approach.

But "zero-interest" Bernanke ignores the obvious at America's peril:

As Bernacke floods the world with cheaper U.S. dollars (unbacked by gold) to fund Obama's obscene deficits, our currency buys less a home, but enables other nations - now holding more dollars - to purchase more of the world's commodities, thereby making them more expensive to American consumers.

Have you priced a box of cereal lately? Or how 'bout an 8-pack of beer? Do you often wonder why- despite declining demand - U.S. gas prices remain "artificially" high?

Indeed- the dollar's trouble has begun:

In just the last quarter (March to June) the dollar's value has fallen an ominous 11% against the Euro....a result of the growing U.S. deficit (O-Bamanomics), which is reducing confidence in the dollar's value as it trades overseas. 

In stark terms, this means the European standard of living has risen 11%; but the American public's purchasing power is down by that same 11% - without even realizing it!

Indeed...dollar ignorance is NOT bliss! 

EXAMPLE #2: Let's say you're a real shrewdie, and you've hidden $100,000 in your basement freezer in "Benjamins" - $100 dollar bills.

Well guess what mister Shrewdie - although it's the same total amount - your NET loss since March is 11%. But despite the grievous decline from inflation, you did NOT even realize it; and those precious Benjamins are now worth only $89.00 each.

This is similar to why gambling casinos issue you chips; as you lose money, the loss seems ethereal; whereas if you were playing with actual dollars, losses would immediately be apparent, and you would withdraw from the game.

Hence there has been no political backlash against the recklessness of the sneaky fools that call themselves the Obama administration, as they treat America's dollar assets as if they were poker chips.

Thanks to their profligate spending/printing, sooner or later, the public will realize we are fast careening downward to an economic waterloo--- all of our own making.

What Obama and his two dunces- Bernanke and Geithner - are doing resembles a circus high-wire juggling act; but sooner or later it's bound to fall:

-How much longer can they keep the dollar from plunging?

-How much longer will the price of gold stay down?

-How much longer can they keep the level of the stock market up?

Any changes in one (or all of the above) will trigger the downward  spiral, and once begun, what's to stop it?

Right now the Dow Jones Industrial Average has been relatively healthy; but people have failed to notice the REAL leading indicator of trouble.

As of late June, the NASDAQ recently fell below 1800- a critical support level - portending  "net-zero" future job growth.

Why? This means entrepreneurs who start new companies (who list on NASDAQ) - now denied tax cuts and incentives - are literally frozen in fear by the political whims of Obama; and (like the1930's) lack confidence in hiring or expanding until the outlook becomes clearer. 

In the roaring bull market of 1982-87, it was the NASDAQ - not the Dow - that powered the decade-long 80's boom. 

Stocks of brand new companies like Apple & Microsoft - and the tech sector in general- were the drivers of America's economic growth during those "go-go" Reagan years.

And in the 90's, it wasn't the economic policies of Bill Clinton, but rather the wealth created by the booming rise in the NASDAQ, this time powered by the internet companies that were founded by the entrepreneurs of "Silicon Valley."

But as we head into the next decade, once again lets be very specific: the essential need for economic recovery calls for America to commence producing SOMETHING besides mountains of debt.

But lacking any real foundation, the Bernanke-Obama-Geithner juggling act WILL inevitably fall. The Fed's insane "money from nothing" printing press, and the Obama phony anti-stimulus, is just delaying the inevitable.

Have a wonderful life.

Has NBC found a replacement for Jay Leno to host the "Tonight Show"?

They only need look to our Treasury Secretary, Tim Geithner (one of America's fastest-rising comedians) who, while in Beijing, recently told the Chinese..."Stand with us; we're doing all we can to protect the value of the dollar!"

Despite the uproarious absurdity of Mr. Geithner's pledge (con job), apparently the Chinese weren't much amused, with their $1.3 TRILLION in U.S. currency reserves now at risk to inevitable hyperinflation, as the U.S. Federal Reserve continues to churn out more paper money than in the entire history of Parker Brothers (creators of the game "Monopoly").

Picture the hapless situation of Chinese Premier, Wen Jiabao:

After years of China's putting its "full faith & credit" in the United States, and buying reams of our AAA-rated treasury bonds, out of the blue comes Barack Obama on television ("60 Minutes") happily proclaiming..."deficits don't matter"...and predicting..."trillion dollar deficits for years to come." 

So is it any wonder that the U.S. dollar has now begun to head south, and along with it, the value of U.S. Treasury "T-notes" (bonds)?

The Chinese-- plus our other large creditors-- have now leaned away from purchasing (financing) our debt, and-- more ominously-- going so far as to suggest the creation of an alternative reserve currency as a hedge against the feeble dollar.

Evidently, world credit markets have had enough of  Mr. Geitnhner's con job.

The values of  U.S. T-notes have begun to fall in recent weeks, and  fears of inflation are now at the point where interest rates are being forced ever-higher to "bribe" the Chinese (et. al.) to go along with Geithner's appeal, and keep up their accumulation of  U.S. treasury bills.

Chinese economists have long fretted that at some point, the world would eventually lose its willingness to finance America 's rocketing national debt, as foreign bankers become ever more disdainful of our proclivity to consume far more than we produce.

And now, that point may have been reached:

Last year's turmoil in U.S. mortgage markets has profoundly shaken the world's faith in the resilience of the dollar-- more so than the bursting of the tech bubble in 2000, or even the terror attacks of 9-11. 

While most economists just recently would have dismissed the prospect of an outright dollar collapse, they now are debating the possibility that something on par with the debacle of the 1970's (when Nixon declared the dollar would "float" and no longer be backed by gold) might just happen again, and set off rampant inflation.

If the U.S. currency does begin to inflate rapidly, the Federal Reserve will find itself in between the proverbial  "rock-and- a-hard place," forced to either ratchet up interest rates-- which strangles the economy-- or alternatively, let the dollar fall, and watch prices of imports (and eventually, competing domestic goods) rise sharply; therefore, touching off even more inflation.

But even worse, Fed chairman Bernacke's reckless running of the printing presses has also raised the prospect of an unprecedented historical nightmare; one that could befall the United States in as little as the next 3-5 years-- a hyper-inflationary depression!

Currently, the only factor keeping inflation under control is a lull in American consumer spending; and the continuing reduced demand for imported goods portends an ongoing period of deflation.

But the storm clouds on the US currency horizon are gathering--and fast: 

Standard and Poor has put Great Britain on "watch". England's credit rating is about to suffer its first downgrade since 1914, as the country's debt approaches 100 percent of gross domestic product. 

The world's bond markets reacted with stunning surprise, taking U.S. Treasury bond yields up 1.5 percent for the year, and the 30-year long bond toward an astounding 5%.

In "plain English" this meant that the credit markets see no problems for the U.S. dollar in the short term (hence, the lower short term interest rates ), but down the road, there is now rampant fear of dollar inflation.

Attention has now suddenly focused on the possibility that-- like England-- the United States might lose its prized triple-A credit rating, placing additional calls for either large "defensive" interest rate hikes, or else trigger massive selling on the world's credit markets-- a possible collapse in both U.S. Treasuries and U.S. dollar values.

The world's investment community cannot easily be conned!  Obama's insane budget deficits will do nothing other than to hasten the end of the U.S. domination of the world's credit markets, which go back some 95 years to the onset of the first World War.

There is an inevitable, inescapable dollar crisis coming.

At some point, as the U.S. continues to print unbacked currency, our foreign creditors may no longer accept paper dollars because they are just that-- paper!  They may demand gold instead of payment in dollars.

Traditionally it  has always been the policy of the Federal Reserve to protect the banks-- not the dollar; but if we look beneath the rhetoric of Geithner, it's apparent that the Fed is now more concerned about “inflationary expectations” than inflation itself; and the Obama administration has deliberately misled the public about what inflation actually does, and how fast it’s happening.

And as the  U.S. continues to go along its merry way of importing everything, and exporting virtually nothing (other than software and entertainment) what then? The value of the U.S. dollar eventually becomes little more than a confidence game.

EXAMPLE: what makes a 100-dollar bill any different from a one-dollar bill, other than Benjamin Franklin's portrait vs. George Washington?

Answer- NOTHING. The only difference one is worth more than the other is simply because people say it is; ergo...the "confidence game."

This situation, where specie (i.e. gold or silver) no longer backs a nation's currency, is defined by the term "fiat money" ("fiat" is a Latin intransitive verb that means "it is" or, "it exists").

Fiat currency is simply the printing of notes (out of thin air) with no intrinsic value. The "confidence" is that the country's money is "valuable" because of its economic and military strength-- thus allowing the removal of gold and silver backing for its currency.

And as the U.S. prints new dollars at an unprecedented rate, you would normally find depreciation in its value because of dilution. But this is where the "con" played by Geithner has come into play:

Up till now, confidence in the Fed's ability control inflation has ben reflected by low, short-term interest rates; but to control the 30-year "long bond" (the  real indicator of inflation) will eventually become impossible; and rest assured, this will trigger hyperinflation.

Multiple choice question (select the best answer) 

Hyperinflation is usually triggered when:

a) Government spending as a percent of GDP approaches 40%

b) There is a large amount of government debt owed to foreign interests

c) The country has undermined its industrial base.

Answer: all the above

Every single example in history-- all the way back to Rome-- reveals that hyperinflation always begins during a deflationary period, combined with a rapid increase in the money supply, coupled with a rapid loss of confidence in the system.

So how can it be any different this time? As Obama continues to undermine our industrial base, and borrows from the Chinese to finance his insane deficits, what now happens? If the dollar's value sinks to the point where it can go no lower, and our recession deepens...then what?  
 
Then it's time to to break out the Kruggerands or Sovereigns (gold coins) hidden in the cellar, because American money won't be worth the paper it's printed on, and we enter a hyperinflationary depression-- a possible scenario where the U.S. might never recover.

Obama's reckless monetary policies are setting the scene for unprecedented disaster. Over time, this excess printing of money is akin to money growing on trees, and it will eventually destroy the value of the dollar in a wave of hyperinflation.

And without some economic miracle, we are headed into an inevitable downward, and irreversible spiral.

Despite the Obama administration's haughty portrayal of U.S. economic invinciblity, the immutable laws of economics cannot be repealed, even by the "Chosen One" himself.