Skip to content

Analyst Sees ‘Hyperinflation’ Due to US Financial Crisis

Analyst Sees ‘Hyperinflation’ Due to US Financial Crisis

| 0 comments

Originally published online by the ABS-CBN News on September 16, 2008.

Analyst Sees ‘Hyperinflation’ Due to US Financial Crisis

Sept. 18, 2008 — A financial analyst on Tuesday sees a grim future for the Philippine economy as the United States suffers a financial crisis that is expected to pull down the global financial system.
Butch Valdez, head of think-tank Philippine LaRouche Society, called on government officials to focus on how to mitigate the “hyper inflationary effect” of the weakening US dollar.
Wire reports on Monday said the global stock market fell to its lowest after the collapse of US investment bank Lehman Brothers.
The blue-chip Dow Jones Industrial Average tumbled below 11,000 with a slide of 4.42 percent to 10,917.51, its largest one-day point loss since the reopening after the September 2001 terrorist attacks.
Valdez sees prices of all commodities to shoot up as the US bails out bankrupt real estate and financial corporations.
“There’s going to be a hyper inflationary effect on the rest of the world. All populations are going to have to pay an exponential increase in prices of all commodities,” he said.
Valdez explained that the US government’s effort to bail out America’s two biggest collapsing real estate corporations, Fannie Mae and Freddie Mac, has doubled its national debt from $5 trillion to $10 trillion.
“And then this, the falling investment banks in the US. The US federal reserve is being forced to bail out the fall of these financial institutions… Bailing them out is the same as collapsing the same system,” he said.
Valdez said if the US dollar collapses, the world economy will be hit hard. He said this is because the global economy is integrated with the greenback.
“With the fall of the US dollar’s value, all dollar reserves of all countries will also collapse,” he added.
Valdez said the country’s public officials should stop political bickering and instead focus on the emerging global economic crisis.
He said if the government fails to cushion the impact of the plunging global economy, Filipinos “will lose the capacity to survive this.”
He said every nation, including the Philippines, will feel the inflationary effect of the collapsing US economy. The world will be forced to print more money, which, he said, will cause “hyper inflation.”
“Our money will lose its purchasing power,” he said, adding that poor Filipinos will be mostly affected by the crisis.

Leave a Comment

You can use these HTML tags:
<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>