In an interview with CNBC, Ron Paul recently said the idea by Ben Bernanke that he will be able to manage inflation once it takes off is delusional.
Paul said, "When it gets to four [percent inflation], and decides to go to eight, there's no way they can stop it... They think they have control. They don't."
"They can't manage a dollar like this. People are going to desert the dollar. I think the Chinese are hinting that already. They're not wanting our dollars as much as they want raw materials and other things," added Paul.
The Chinese have quickly responded to the actions of Bernanke and the Federal Reserve, downgrading U.S. credit because of the latest round of quantitative easing, which will inject $600 billion into the economy over the next eight months, and if that doesn't work, hints from the Fed are they'll continue printing money until they get the economy moving, even though the $1.7 trillion already wasted has done nothing of the sort.
China said, "The serious defects in the U.S. economy will lead to long-term recession and fundamentally lower the national solvency. The credit crisis is far from over in the United States and the U.S. economy will be in a long-term recession. In essence, the U.S. government's move to devalue the dollar indicates its solvency is on the brink of collapse."
The Chinese rating agency Dagong Global Credit downgraded the sovereign debt rating of the U.S. from A+ to AA.
Other countries like Germany have made statements such as the US has been living on debt for far too long.
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