Peter Schiff appears on the Laura Ingraham show this morning.

One of the more interesting points he makes is evaluating the value of the Dow in light of ounces of gold. When Bush took office, the Dow was roughly 42 ounces of gold. Now it’s about 9. He expects that by the time Obama leaves office, it’s likely to be around one ounce of gold in value.

He compares the attempts to “fix” the economy to attempting to recreate the debt-based house of cards.

His advice is the same that it’s been for a while, which is refreshing considering that he’s taken some heat for it recently: gold, silver, foreign currency (he calls the dollar’s recent surge a false rally), and foreign stocks and bonds.

Peter Schiff has a great interview with Yahoo’s techticker.

The fiscal stimulus bill being debated in Congress not only won’t help the economy, it will make the recession much worse, says Peter Schiff, president of Euro Pacific Capital.

…the difference is that the economy is in a much worse state going into this depression than it was in the 1930s… and without the discipline of gold, we have a central bank that could create massive inflation. So we could have an inflationary depression.

Janszen at iTulip.com is always on target. His latest post, focusing on the latest rate cut insanity and the Fed’s likely next steps is no exception and a a powerful must-read.

Early in the article, he focuses on the potential short-term benefit to consumers being huge discounts. But he also lays out some prophetic advice:

Advice to readers: take advantage of the early 2009 Great American Fire Sale and go out and buy all the generators, chain saws, washing machines, fine linens, and other durable goods you’re going to need for the next few years because by the end of 2009 most of the inventory may be sold through, many retailers will be shut down, and replenishment of stocks of the survivors will likely be meager; our models say that the goods import supply will decline more precipitously than the supply of money available to pay for them. That spells severe stagflation. 

But elsewhere he suggests that consumers would better save their limited funds to prepare for the coming disaster than to spend them. But isn’t that contrary? Besides the obvious need for cash on hand to pay the increasing bills, isn’t the cash going to be worth less once the temporary, bankruptcy-driven deflation passes and the monetary policy-driven inflation kicks in?

While commentators seem to try to hedge their bets by obfuscating, the Euro continues its surge relative to the dollar. It strikes me that this is a fundamental rebound. Then again, I’m a neophyte.

Here’s a DailyFX chart that illustrates the dramatic “V” rebound.

Have we seen the end of dollar-buying to liquidate positions in the US prior to the end of the year and prior to the Obama administration’s debut?

Also note that a significant portion of the surge in oil prices is actually tied to the exchange rate. This should begin to re-introduce inflationary pressures on the economy and counter the deflation — both real and predicted — of the past several months.

This may not be a final blow to the dollar, but it should serve as a wake-up-call that we should not expect deflation to win out in the long term, especially for imported or energy-sensitive commodities.

The question is: when will inflationary pressures of dollar printing and borrowing begin to outweigh the downward pressures introduced in real estate and retail from bankruptcies and liquidations? And what impact will negative real interest rates in the U.S. have on the dollar and the economy? Is there a window of opportunity in the next weeks or months for individuals to improve their positions before the storm actually hits in full force?

It looks like the Senate did the right thing. Now it depends on the President to do the right thing (for a change) and let the bankruptcy reorganize the companies in the courts instead of hooking up the taxpayer IVs and letting the politicians get their fingers in:

The Senate rejected the bailout 52-35 on a procedural vote — well short of the 60 required — after the talks fell apart.

“I dread looking at Wall Street,” said Senate Majority Leader Harry Reid in anticipation of Friday’s stock market reaction. “It’s not going to be a pleasant sight.”

Gee, Harry, not a pleasant sight? I suspect it won’t look any worse than many of the days over the past few months. Besides, since when have you been concerned about Wall Street? I thought you were all about “the working people”?

Stock futures are down, foreign markets are down about 3%, the dollar’s regaining a little versus the Euro, and oil is retreating further. Hard to tell if it’s based on the news. Perhaps if the President announces a plan we’ll see the reaction in a lower dollar, higher oil and gold. It’s not going to be a pleasant sight…

Sharon at Casaubon’s Book blogged about how increased interest in personal gardening and farming is impacting the seed market:

Yesterday afternoon, my Fedco Seed Catalog arrived – always my personal favorite.  And on page 6, what should I see but this, in founder CR Lawn’s description of their situation:

And now seed prices.  I’ve ben 30 years in this business and these are the highest increases to us I’ve ever seen.  The ethanol boom diverting land to corn production has ahd a tremendous impocat on farm commodity prices, including vegetable seeds.  Wholesale prices for pea and bean seed are up 30-50%, for corn and squash, 20% or more.  Even so, wholesalers could not find growers for all crops so several varieties are missing from our catalog.  Horrible growing weather this summer has exacerbated the shortage.