32 THE BiG DROP
This fund could come into the market and can buy and sell
on a continual basis, not really trying to make money. That’s
because its purpose would not be to make money like a nor-
mal hedge fund. Instead, it would actually have a malevolent
geopolitical financial warfare intent.
It could build up its credit lines, build up its credibility,
get facilities with major banks and then one day, just flood the
market with sell orders in a particular stock. They could sell
the big stocks too like Apple, Google and the like.
They could use options to amplify their attack — and they
wouldn’t do it on a sunny day. They would most likely pick a day
when the market was already down, maybe three or four percent
already. That would be a big day down say, down, by as much as
six-hundred points. By piling on, this enemy hedge fund could
create a panic and then disappear the next day, taking its money
and going back to Beijing or wherever it came from.
A hedge fund entity could be set it up, funded, and left to
be operated normally for years or even longer until one day, it
attacks U.S. financial markets. That’s one scenario that could
play out and the United States certainly needs to be alert to that.■ inflation Takes Hold
The important thing to understand about inflation is that the
Fed wants it. That’s very hard for people to understand be-
cause most people remember the late 1970s or early 1980,
when we had out of control inflation.
From 1977 to 1981, cumulative inflation over that five-
year period was fifty percent. That means, if you were a saver,
had annuity, an insurance policy, a retirement income or any
kind of fixed income at all, you lost half of your purchasing
power in five years.
People go back to the creation of the Fed in 1913 and they
explain that the dollar has lost ninety-five percent of its pur-