2) Pumping too much money, through ever increasing bailouts, into the global economic system dilutes the power of money to stimulate growth and creates new problems (specifically a slumbering inflation monster) (see the following chart displaying cash and electronic cash in the US http://mises.org/content/nofed/chart.aspx).
3) The world shares a bed with the US, and the US debt problem is massive to say the least.
4) Fiat currencies are linked to nothing and the USD is a fiat currency.
Refer to the following website for an illustration of the US debt.
Many think this is only a short term euphoria, I can only agree.
The world economy is being kept alive using debt on steroids. I could never solve my own money problems by going into more debt. Yet, this seems to be what the world is doing.
The final step is to uncouple money from gold, silver and real assets creating a fiat currency (decreeing the backed-by-nothing money to have value). Fiat currencies ALWAYS go bust at some point, just ask these guys in history:
If all currencies were to go bust, what will happen to your investment portfolio? Remember that educated investors can make money when markets go up and when markets going down.
After reading some articles on bloomberg.com yesterday, I found that some optimism has returned to the US markets. Italy's bond auction went better than expected. However, I do not think any of the real underlying problems were solved. The markets love short term chatter, this time, I am not buying it!
Some sources I found to be insightful:
1) Debt Collapse by Mike Maloney (1.5 hour video, very large download)
2) Rich Dad's Advisors: Guide to Investing In Gold and Silver (Book available from Amazon.com, Kalahari.com, audible.com)
3) Mike Maloney Schools Bankers on Deflation (Youtube)
4) Nouriel Roubini: Perfect Storm Coming for Global Economy in 2013 (Youtube)
5) Milton Friedman - Debunking the Myth of the Great Depression - Part 1 to 3 (Youtube)
Disclaimer: I am not a registered financial adviser. Please consult with personal financial advisers before making decisions regarding your personal finances.