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9:00 AM EST, Wednesday, March 25, 2009. Many of you have not read yesterday's long piece from Rolling Stone on how a Mr. Joseph Cassano singlehandledly brought down the entire world's financial system and how Goldman Sachs alumni rode gallantly in to the rescue, enriching themselves and their firm beyond anyone's wildest imagination. For yesterday's column, click here.

For your second assignment, you need to watch this Glenn Beck video clip from Fox. It shows how much money the United States is printing and printing and printing. The chart will blow you away. If this printing doesn't cause runaway inflation and destroy the dollar, it will be nothing short of a miracle.

When will all this happen? I don't know. But, just as the tech bubble burst and the housing bubble burst, the printing money bubble will also burst.

What must each of us do to protect ourselves? The obvious solution includes gold, precious metals, diamonds, and hard assets (like real estate). What else? I'm not sure. Watch this clip. If that doesn't work, paste this into your browser. http://www.youtube.com/watch?v=YDEe0Ai6lTM. Don't get too paranoid. Then send me an email with your thoughts -- . Beck followed that clip up with another -- called The Incredible Shrinking Dollar -- that's also worth watching. Click here.

Meanwhile, the Europeans, who have had many more bouts with hyperinflation than we have, are resisting the printing press. Excerpts from from today's New York Times:

European Bank Resists Printing Money
FRANKFURT — At the European Central Bank, being a maverick means holding steady as others bow to the prevailing winds.

As its peers in the United States, Britain and Japan crank up monetary printing presses in a bid to prop up their economies, the European bank is resisting the rush to adopt those banking policies.

The European approach, to many outsiders and even some politicians like Nicolas Sarkozy, the president of France, is hopelessly myopic and likely to leave Europe struggling long after others have resumed growth. But it has become the signature approach of the European Central Bank since credit markets first tightened in August 2007 to consider, before tearing up the rule book, not only the crisis of the moment but what comes later.

“Exaggerated swings without perspective,” the central bank president, Jean-Claude Trichet, said recently, “would delay the return of sustainable prosperity because they would undermine confidence, which is the most precious ingredient in the current circumstances.”

When others sharply cut interest rates, the European bank was slower to act. When others stepped in to bail out financial institutions, the European bank, constitutionally limited in its powers, left that to national governments.

And now, with other central banks acting to create money out of thin air because they cannot prime the lending pumps by lowering short-term interest rates any further, the European bank remains wary of the specter of inflation.

Beneath it all is an aversion to anything that smacks of “printing money,” a phrase that evokes Europe’s worst economic nightmares, everything from kings debasing their currencies to fight endless wars to the hyperinflation and currency collapses in Germany after it lost two wars in the 20th century.

But in the view of its critics, the European bank is underestimating the dangerous and unpredictable dynamics of the recession. With the risk of being caught in a downward spiral, they say, the European bank should be actively pushing cash into the economy now, as the Federal Reserve, the Bank of England and the Bank of Japan are all doing.

“What they are doing is simply not enough, and this is not one of those downturns that you simply work your way through,” said Kenneth Wattret, chief euro zone economist at BNP Paribas in London.

Another danger for the European bank, economists said, is that policies in Washington and London put pressure on the euro by means of the exchange rate.

The euro has climbed about 10 percent against the dollar since the Fed policy was announced, the logical consequence of a decision to increase the supply of dollars. It is also up sharply against the pound.

A sustained strengthening of the euro would price more European exports out of world markets as they recover, giving the American economy a significant leg up without any overt decision to devalue the dollar.

“You can’t suddenly start engaging in competitive devaluations of your currency,” said Erik Nielsen, chief Europe economist at Goldman Sachs. “But you can loosen monetary policy domestically, which has the same effect.”

With the European bank’s benchmark interest rate at 1.5 percent, and probably headed lower, the overarching economic policy question in Europe has been whether the central bank in Frankfurt will join the worldwide move to buy financial assets — whether private bonds or government debt — as interest rates near zero. This policy is known as quantitative easing. ...

“It could be fatal for the euro’s credibility to have the E.C.B. simply start printing money,” said Julian Callow, chief Europe economist at Barclays Capital in London. “It’s too much to ask of a currency that is not even a teenager yet.”

Meanwhile, Richard Russell, respected publisher of the Dow Theory Letters writes today:

A few fundamentals
The world is up to its neck in debt. Most of the debt is denominated in dollars. Consequently, there now exists a world dollar shortage. The world debt acts as a short position against the dollar, since only dollars can relieve this debt. The Fed is attempting to relieve the situation by manufacturing dollars by the trillions. This increased printing will put downward pressure on the dollar. Meanwhile, other nations will do the same thing, since every country wants to export, and a cheap currency is a big aid to exports. The net result of all this fiat money creation will be increasing suspicion regarding paper money. The rising world amount of fiat currency will tend to swamp deflation, and ultimately there will be distrust and a move out of paper money into gold.

The trillion dollar question is "Will all this currency creation lead to credit creation?" Personally, I don't think it will -- in fact, I think the nation would be better off if the government had stayed out of the situation and the natural processes of a bear market had been allowed to occur. Every bear market in history has come to an end, and this one would too if the government allowed it to. But the government must from a political standpoint be seen as "doing something," even if that something prolongs the recession and wreaks further havoc on the markets.

So what are we to do? I think the best thing we can do is protect ourselves the way I've been suggesting for months on end. By paying off as much debt as possible, while accumulating dollars and gold. A position in dollars and gold, so far, has served us very well over the 18 months of this brutal bear market.

My own instinct is to sit with dollars and gold, and wait as patiently as I can. If there was something brilliant that I could suggest to my subscribers, believe me, I would do it. But there isn't. There's an old Wall Street axiom -- "When in doubt, stay out." There's an old Chinese saying that fits all occasions -- "This too shall pass." That saying served me well during World War II. And indeed, that damnable war did end.

That's enough gloom and doom for today.

Wonderful things lawyers say in court.
These are from a book called Disorder in the Court, and are things people actually said in court:

ATTORNEY: What was the first thing your husband said to you that morning?
WITNESS: He said, 'Where am I, Cathy?'
ATTORNEY: And why did that upset you?
WITNESS: My name is Susan!

ATTORNEY: This myasthenia gravis, does it affect your memory at all?
WITNESS: Yes.
ATTORNEY: And in what ways does it affect your memory?
WITNESS: I forget.
ATTORNEY: You forget? Can you give us an example of something you forgot?

ATTORNEY: Now doctor, isn't it true that when a person dies in his sleep, he doesn't know about it until the next morning?
WITNESS: Did you actually pass the bar exam?

ATTORNEY: So the date of conception (of the baby) was August 8th?
WITNESS: Yes.
ATTORNEY: And what were you doing at that time?
WITNESS: Getting laid

ATTORNEY: She had three children, right?
WITNESS: Yes.
ATTORNEY: How many were boys?
WITNESS: None.
ATTORNEY: Were there any girls?
WITNESS: Your Honor, I think I need a different attorney.

ATTORNEY: How was your first marriage terminated?
WITNESS: By death.
ATTORNEY: And by whose death was it terminated?
WITNESS: Take a guess.

ATTORNEY: Can you describe the individual?
WITNESS: He was about medium height and had a beard.
ATTORNEY: Was this a male or a female?
WITNESS: Unless the circus was in town, I'm going with male.

ATTORNEY: Doctor, how many of your autopsies have you performed on dead people?
WITNESS: All of them. The live ones put up too much of a fight.

ATTORNEY: Are you qualified to give a urine sample?
WITNESS: Are you qualified to ask that question?

ATTORNEY: Doctor, before you performed the autopsy, did you check for a pulse?
WITNESS: No.
ATTORNEY: Did you check for blood pressure?
WITNESS: No.
ATTORNEY: Did you check for breathing?
WITNESS: No.
ATTORNEY: So, then it is possible that the patient was alive when you began the autopsy?
WITNESS: No.
ATTORNEY: How can you be so sure, Doctor?
WITNESS: Because his brain was sitting on my desk in a jar.
ATTORNEY: I see, but could the patient have still been alive, nevertheless?
WITNESS: Yes, it is possible that he could have been alive and practicing law somewhere.


This column is about my personal search for the perfect investment. I don't give investment advice. For that you have to be registered with regulatory authorities, which I am not. I am a reporter and an investor. I make my daily column -- Monday through Friday -- freely available for three reasons: Writing is good for sorting things out in my brain. Second, the column is research for a book I'm writing called "In Search of the Perfect Investment." Third, I encourage my readers to send me their ideas, concerns and experiences. That way we can all learn together. My email address is . You can't click on my email address. You have to re-type it . This protects me from software scanning the Internet for email addresses to spam. I have no role in choosing the Google ads on this site. Thus I cannot endorse, though some look interesting. If you click on a link, Google may send me money. Please note I'm not suggesting you do. That money, if there is any, may help pay Michael's business school tuition. Read more about Google AdSense, click here and here.