Fake money = Fake Prices
While it may seem simple that fake money = fake prices, it is, actually, pretty complex. The very act of conjuring up “money” out of nowhere is, in itself, a theft of our labor. Unfortunately, this is just the tip of a VERY deep iceberg.
If it were just that the “money” being conjured up we would likely see higher prices over time. However, what is being done with this “money” is the real cause of our problems. This “money” is becoming worth less and less each day as it is being conjured up in amounts we cannot even imagine and at virtually NO COST and virtually NO LABOR involved. This, in reality, makes this “money” virtually worthless. Of course, it is a unit of debt and backed up by the full faith and credit of the USA here and whatever other tax slaves exist in other jurisdictions where the same actions are taking place.
I am wondering out loud when reality will set in. Our country admits to nearly 29 TRILLION in debt and has unfunded liabilities of nearly $200 TRILLION. In addition, we are running deficits (admitted to) of $3.6 TRILLION. (US Treasury) Using GAAP accounting it is likely over $9 TRILLION ANNUALLY.
That means we are like a person who has maxed out their credit card and are tapping other cards to keep paying the current one. But don’t worry! You have our full faith and credit. Anyone who thinks these debts can be repaid with our “money” having ANYWHERE near its value is clueless about our financial condition- which in my view is terminal.
Already the US dollar has lost 84% of its value just from the year 2000 vs. gold and it has lost 98% of its value Vs. gold since 1971. This simply means that if you had purchased gold in 1971 and measured the dollar against it the dollar would be worth 2 cents today. Keep on “printing” guys- we are on the fast track to ZERO at some point- just like every other fiat (backed by nothing) currency that has ever existed.
When confidence in the dollar wanes, the end will be near for our way of life as we have known it.
Of course, to keep the masses fat, happy and clueless we are bombarded with misinformation daily on the financial game shows and the “news” which has become nothing more than a propaganda machine.
Is it any wonder that many think the economy is booming when all of the economic data has been abysmal for years?
They never seem to mention the $140 TRILLION that Dr. Mark Skidmore has dicovered “unaccounted for” at the Department of Defense and HUD. When I say that what we know is scary enough and wonder what it is we don’t know- this is at the top of my list. It appears to me that the only place to hide $140 TRILLION would be in the derivatives “market” to prevent the whole daisy chain collapsing and collapsing the banking system.
Many may say- “Thanks Fed and other central banks for preventing a global meltdown”. I guess that is a rational thought but what if they didn’t let the banks get us into this position in the first place? What if everyone had to play on the same level playing field as opposed to letting the few run amok and leverage their positions so that they could wipe entire countries out if they were to actually fail?
Of course, since that newly conjured up cash is going to the owners of the Fed- the major banks- they are betting the house that no matter what- they win. Even if it means everyone else loses.
With this leverage and animal spirits no games seem too risky. Since virtually all of the too big to fail banks have been convicted of felonies but not one person in any position of power has been held accountable the stakes seem pretty favorable for those “in charge” to continue being reckless at best and continuing the frauds they have been perpetuating at worst. They couldn’t do this without the complicity of MANY in power.
I have written extensively about the manipulation of the gold and silver markets where paper contracts are conjured up out of nowhere and sold into the market when there are few buyers. This is done to fool the many about how our “money” is being debased. I also believe that this may be being done so that the central and major banks can load up on the metals at a steep discount. Why would I think that? In the first half of 2021 gold purchases by central banks were 333 TONS. This is what they admit to.
With all of the games being played gold and silver are MASSIVELY undervalued- particularly when you look at the amount of fiat currencies being conjured up out of nowhere. Based upon the quantity of “money” gold is as cheap today at $1800.00 as it was in 1970 at $35.00 or in 2000 at $300.00. Anyone who thinks gold is expensive today has NO idea what is happening.
Bonds are being bought to keep interest rates artificially low. This allows governments at all levels to go deeper and deeper into debt with few consequences in the near future but possible DIRE consequences in the medium to long term.
This also allows companies and individuals to go deeply into debt. This actually seems like a good thing since our dollars are becoming worth less it allows many to maintain their current lifestyle- at least for a while. When interest rates rise – it’s game over! By the way- when you can’t pay your debts your debtors will own what you considered your property.
Since little can be earned in cash or bonds many move to stocks to provide much needed income. Some even buy real estate. These suppressed rates are actually artificially propping up these “markets”.
Again- when rates rise it’s game over. This is not only because companies won’t be able to pretend to be solvent anymore but the default of the bonds would lead to a 100% loss for common shareholders and likely everyone else with a stake in a company other than the secured bondholders.
Another interesting aspect to the free money is that it makes people gamblers as opposed to investors.
In a normal functioning economy, money is invested in companies with new ideas and good profit prospects for the future. Today, the most shorted stocks (meaning those with the least probability of future success) are creating the largest returns. People who look at numbers are betting against the future prospects of MANY companies because there are many debt-impaired companies that have few, if any, profits and many are bankrupt already but have not recognized it yet because even more cheap loans are being piled on to give the illusion of solvency for a while longer.
Just recently AMC- America’s largest movie chain which has grim prospects for the future and is drowning in debt was able to issue more stock- because of a rising price based upon a short-squeeze. This allowed the company to raise additional capital that will extend its zombie life for a while. What this effectively did was transfer this money that was “invested” away from another company that may have had a much greater chance of future success and may have even provided a much needed product.
My point here is that there is a lot of cash chasing dreams of quick riches at the expense of future innovation and good long-term gains. This stifles innovation, punishes job growth and limits future opportunities for many.
Ask yourself a few questions:
- Do I believe that “printing” money and issuing new debt to solve a problem of being over-indebted a plan that can work long term?
- Do I believe the central banks can stop the “printing” without causing the greatest crash in human history?
- If they don’t stop when will our “money” be no longer accepted as having any value?
- Do I have a belief that those who are promising me repayment can actually pay?
- If they do pay, what value am I going to be receiving? Notice I didn’t say “amount” I said value.
- Have I done anything to protect myself from the loss of purchasing power of all fiat currencies?
- What do I believe are the assets that can preserve my wealth best over time?
- Why are central banks- who can conjure up trillions with a mouse click buying record amounts of gold?
- What does Warren Buffet mean when he says: “Price is what you pay, value is what you get”
- Am I prepared for a period where the economy may not function anywhere near what we are accustomed to?
These are just a few questions that we should take seriously. I believe the biggest problem of our time right now is complacency. We are seeing our rights trampled on, we are seeing our “money” and therefore, the value of our labor being destroyed and just because the water isn’t fully boiling yet most people are confident that even though we are going down a path that has a 100% failure rate- it won’t happen here.
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