Yes. The government must trigger inflation. It is attempting to do so in the following ways:
1.) free money for the people ('tax rebates' last summer)
2.) low interest rates (they've been dropping since Bernanke realized he triggered the disaster by increasing them a year ago)
3.) increased government backed securities (700 billion + bailout)
4.) direct government investment in financial institutions.
The underlying truth here is that the US govenrment does not have any money at all, it too operates in deficit. So all of these promises and 'free money' are, indeed, expansions of the money supply to replace the crumbling housing-backed securities (that were falsely inflated in the first place and which was simply a bubble that popped up after the dot-com bubble bursted.)
It is direct government attempts to increase money supply based on worthless fiat dollars. That the dollar index has surged recently is only comparative to other world currencies: the knew jerk reaction of the world is to buy dollars at a time of crisis. However, that does not mean the dollars are worth anything.
Right now the greatest risk of all would be a Chinese announcment that it is selling off its dollar reserves. If that happens, God help us all. As Warren Buffett has said in the past, the credit expansion that has been in creation for hte past 7 years is indeed a 'weapon of mass financial destruction'.
Currencies world wide are in grave danger. Get into hard currency, get into gold and silver right now before the government begins to limit sales (actually, they already began limiting sale of silver a few months ago.... and they say they didn;t see it coming??)
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