-->Bush launches election campaign
Implements economic recovery plan


On May 16th, President Bush formally launched his campaign for re- election by filing notice with the Federal Elections Committee of his intention to run in 2004. He will now legally establish his campaign headquarters, assemble an election team and launch fundraising programs.

But more importantly, he has placed in motion the"Bush Economic Re-Elections Economic and Market Strategy" because when all is said and done Americans always vote with their pocketbooks.

He also has the counsel of his father who won a war and boosted his popularity but went on to lose the presidency because the economy tanked. Bush the younger, in his navy flight suit and helmet in hand in a recent high profile"photo opportunity," has also won a Gulf War and the adulation of his countrymen but he doesn't intend to lose the presidency like his father, George Bush Senior.

To keep the presidency, the reigning president has put in place a pre-emptive duplicate of the"Roosevelt Anti--Deflation Strategy" with timing and scope differentials. For that reason, I have updated the schematic that compares the Roosevelt Program and the Bush Program. I will keep updating this as we move into the 2004 Presidential Election.

The difference in the Bush program is that we are already in a global conflict that is far from over: the war against terrorism. Another difference between Roosevelt and Bush is that the Bush dollar was devalued in the marketplace before the CPI went to net negative on manufactured goods, an event that portends the arrival of deflation.

Due to the death of President Hoover, the Roosevelt anti-deflation program was delayed until after the 1929 crash had destroyed monetary aggregates en masse through the failure of major banking institutions. It wasn't until after the damage had been done that the dollar was devalued in terms of gold.

In the present Bush strategy, the dollar has been and will continue to be devalued in terms of gold. Gold already is above the ten year moving average which heralds reflation. This is why gold is now always a buy below $350 and April the 4th was a grand opportunity.

While the markets are currently celebrating the Bush anti-deflation program with a nice rally, they may be a tad early and overly optimistic. There is no question that the core CPI figure will be the"barometer" of this administration's anti--deflation program's success or failure. Yes, as you can see, it is already forecasting a rise by forming what may well be a falling wedge which is a bullish formation in 80% of the cases.

Yes, the core CPI must break out of the top of lines"A" to"A" without first pushing the lower line"B" to"B" lower. The rub is that for 22 years of the"Zero Inflation World Central Bank Campaign" the means of developing the CPI has been changed to favor lower readings.

One might have even mused if the CPI could ever again register inflation regardless of how expensive it became to live. The CPI bias is clearly towards lower inflation. Therefore, registering a high core CPI will not be easy unless of course the adjustments that have been made are re-adjusted.

When the core CPI does rise, it will not be called a dirty word like"inflation" but rather"stable prices." Therefore, the equities markets are presently celebrating the reoccurrence of"stable prices" which means the return of inflation. Can the core CPI deliver?

If the core CPI fails to deliver stable prices, the stock market will have come on too strong and too early. If stable prices fail to arrive, do not deliver the hope for favorable economic conditions, and fail to assist the re-election of the sitting administration, then gold will return to the dollar in June of 2004.

Gold's return will be in the form of a revitalized and modernized Federal Reserve Gold Certificate Ratio but this time tied to the annualized rate of growth of M3 above 3% pa.
<ul> ~ General Editorial</ul>