Ron Paul on The View, Silver Crisis, Tamny on Deflation, and China Overtaking the U.S.?

Here is Ron Paul from The View today:

Not too bad, he holds his own next to Whoopi.  More good news as it has almost been confirmed that Paul will announce a presidential exploratory committee tomorrow.  From National Journal:

Rep. Ron Paul, R-Texas, whose outspoken libertarian views and folksy style made him a cult hero during two previous presidential campaigns, will announce on Tuesday that he's going to try a third time.
Sources close to Paul, who is in his 12th term in the House, said he will unveil an exploratory presidential committee, a key step in gearing up for a White House race. He will also unveil the campaign’s leadership team in Iowa, where the first votes of the presidential election will be cast in caucuses next year.

Just for kicks, here is Paul on Hardball with Chris Matthews:

And Russ Roberts just been announced that the second version of the infamous Keynes vs. Hayek rap video will be released this Thursday.

Now for the bad news on the announcement front, APMEX is out of silver eagles until May 13, 2011.  Here comes a bubble?

And now they are offering to buy anyone's silver for $3 over spot:

And now CME has hiked silver margins by 9%.  With such demand, you would be an idiot to sell silver right now.  It's tough to see it going anywhere but up for now.  Check out this article from Lewrockwell.com which warns of placing your faith in physical storage. Check out Bill Cramer's story:

I have been pondering why deflation is so bad for the government over the past few days.  John Tamny answered my prayers in his Forbes column on Japan's mythical "lost decade" today:

Much as a weak currency pushes up the broad price level, deflation pushes it down. It wreaks havoc on commerce simply because nominal prices must eventually account for the rising currency, but if debts were taken on when the currency was weaker, the falling prices make debt service more difficult.
To put it more simply, imagine taking out a $1 million loan to buy barrels of oil at $100 in order to sell them at oil’s current price of $112/barrel. If the price stays the same there’s a nice return, but if the dollar’s value strengthens such that the price of oil falls below $100, the near-term deflation wipes out any nominal profits on the investment, and if it strengthens substantially, the investor is out a lot of money.
Japan suffered a real deflation whereby a rising yen forced down all prices. For those not in debt this was a Godsend, but for those heavy on debt the deflation not only erased profits, but it effectively made Japanese companies insolvent.

Awww, not it makes sense why the government pursues inflation.  After all, why should a system built on debt not fix itself?
So the IMF has caused a stir today in predicting that China would overtake the U.S. economically by 2016.  Thankfully, that prediction has be refuted by the International Business Times which points out China's huge property bubble and coming hard landing:

Here is how they do it:

1) Average the annual growth rate over some past period

2) Adjust that rate up or down a few percentage points based on contemporary biases

2) Extrapolate the adjusted growth rate over the desired period

These “adjusted extrapolations” are virtually worthless because the “adjustments” are guesses derived from plugging past data into models. Moreover, they’re often wrong because reality doesn’t simply extrapolate from historic data.

These economists are notorious for missing "big picture" events and shifts. They largely missed the 2008 global financial crisis and China’s astronomical ascent in the 2000s.

And of course news like this doesn't help China's prospects, from Xinhua:

China's consumer prices may increase about 4.5 percent this year, exceeding the government's full-year target of 4 percent, an official said Monday.

I will end by mentioning a great article in the Washington Examiner on Boeing's close relationship with the Obama administration.  After mentioning the NLRB's recent decision to not allow Boeing to set up shop in South Carolina:

This extraordinary abridgement of economic freedom might suggest an anti-Boeing vendetta from President Obama, except that this administration's Export-Import Bank has subsidized Boeing with nearly $15 billion in loan guarantees in the past two years -- roughly three-quarters of all of Ex-Im's guarantees during that time.Boeing and Obama, both based in Chicago, have a real political friendship. In 2008, Obama was by far the biggest recipient of campaign contributions from Boeing employees and executives, hauling in $197,000 -- five times as much as John McCain, and more than the top eight Republicans combined.

And check out this great, but also sad, series of e-mails on Mish from a surgeon who has officially "shrugged." (left the medical field because of abundant government regulation)

Update- USDA reporting higher prices of meat by 6% to 7% up this year, 12% higher than they were last year.

Here is Ron Paul on the Colbert Report:

And check out this great article from Business Insider by Joe Weisenthal on why Ron Paul's presidential run will matter so much more this time.