Jim,

Your recent comment on Quantitative Easing cited an article "M3 where Art Thou" which used a 2008 graph of M3 from Capital Economics/Lombard Street Research which is so different from the figures estimated by both Shadowstats.com and Nowandfutures.com that clarification of who is right is essential for an understanding of what is happening to M3 and its related effects.

CIGA Ron M

Dear Ron,

Who do you think? The Establishment entity or those who have kept the calculations pristine from change and politically motivated adjustments. The answer to your question is that Shadowstats.com gives a more accurate M3.

Regards,
Jim

Jim,

I would really hate to see a VAT but agree it is probably coming.

Monty Guild
www.GuildInvestment.com

A European-style tax?
Like it or not, there’s only one way we’re going to be able to pay for our ballooning deficit: a value-added tax.
By Shawn Tully, editor at large
Last Updated: December 2, 2008: 9:27 AM ET

NEW YORK (Fortune) — It’s highly possible, if not inevitable, that Americans will soon live under a radically different tax system – one that the pundits and politicians aren’t talking about.

It’s called a value-added tax, or VAT, and it’s been used for decades to pay the bills and sustain the immense growth of governments around the world, from France to Mexico to Australia. Created in 1954 by a French economist, the VAT is the most potent, efficient machine for revenue generation yet invented.

And if there’s one thing the U.S. government needs as the federal budget balloons, it’s a ton of new revenue. "The bottom line is that the income tax cannot support the level of spending that’s projected, something other countries faced years ago," said Roberton Williams of the Tax Policy Center, a non-partisan research institute. Today the VAT raises almost half of the total government revenue in France, and a similar share in most of the developed world.

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