I’ve joked with people that because the Obama stimulus will lead to inflation, soon enough the US will become like Zimbabwe:  every time we do a print run of our currency, we’ll have to add three zeros.  Zimbabwe now has a 100 trillion dollar note.

Now some major players are recommending that people abandon the US dollar for other investments.  From Bloomberg:

Jim Rogers, chairman of Singapore- based Rogers Holdings, said investors should be “worried” about the U.S. dollar, and recommended selling government bonds and buying raw materials, China stocks and the yen. “If I were you, I would be worried about the U.S. dollar,” said Rogers, 66, in a speech at the Asia Financial Forum in Hong Kong today. “The Americans are printing U.S. dollars. The Americans are going to do whatever they can to revive their economy, even if it means destroying the U.S. dollar.”

And this from Bloomberg:

A rally that sent U.S. Treasuries to their best year since 1995 is coming to an end, South Korea’s National Pension Service, the country’s biggest investor, said….“It’s time to sell U.S. Treasuries,” said Kim, who took over as head of investments at the start of the year. “The stimulus plan may cause inflation. The U.S. will raise the benchmark interest rate.”

Economist Allen Sinai says that the US risks looking like a banana republic (hat tip redstate.com).

Well, it makes sense:  money doesn’t grow on trees unless you print it with nothing to back it.  There are three ways that Obama and the Democrat Congress can spend a trillion dollars for this planned stimulus package:  (1) Increase tax revenue (NB: increasing tax rates often discourages productivity and reduces revenue); (2) Borrow it (but who will lend to the US government at zero % interest?); or (3) print it.  While the current deflation caused by suddenly worthless mortgage paper can perhaps be offset by various kinds of government stimuli and bailouts, the Democrat plan in my view is simply insane and after a year or two will lead to significant devaluing of the US dollar.  Zimbabwe is a modern parable of fiscal irresponsibility.