How does this Macroeconomic prognostication apply to YOU practically speaking. How do you make money so to speak from this general statement. Before we get into making money one needs to stop and pay attention to what is behind this policy. It is a policy of creating money out of thin air with nothing backing this new money other than the faith and credit of the people of THIS nation. That's right. This money is being created because YOU are going to pay all of the debt is is buying in the form of U.S. T-Bills. The government creates debt in your name to sustain its 800 military bases in 185 countries.....it sustains an ever-expanding health-care system that is driven by the hospital/pharmaceutical lobby bottom line....it pays out social security for a growing elderly population supported by a constricting working class. Its not an accident that virtually every month when they discuss the employment numbers that our largest additions of jobs in the private sector occur in health-care. Can you imagine? We are building a producing a globally competitive 21st Century economy with HEALTH CARE???? Who are we going to export this massive part of our producing economy to. Short of a very few pharmaceuticals and medical devices there really is not much we have to offer here for our trade balance equation.
So you see we are no longer in the position of the biggest economic bully on the block. We're just the biggest bully.......militarily speaking that is. That's right.....the bulk of our malinvestment has created the largest military industrial complex by far and away the world has ever seen. Its not an accident and it is exactly what enforces the dollar as the World's reserve currency. We have maintained control of this Currency privilege since WWII......and until we lose it then we can continue to print money unabated to fuel our consumption/system. If you are thinking this is an unfair advantage, what do you think the other developing countries think. They look at our balance sheets and massive derivatives that we keep printing money out of thin air and they wonder what happens next. Spain, Italy, Greece, Portugal experiencing massive austerity with unemployment over 25% and they see us getting fatter and fatter. We export death and destruction to countries that are experiencing double digit inflation in precious food commodities and we wonder why they hate us. We've created so many moral hazards that we're losing track of them. Much like a habitual liar does with all of his constant tall tales....eventually becoming a laughing stock of the people around him that can remember the contradictions of his previous tall tales. We are getting there fast. People are laughing at us and for good reason.
Let us assume the system does stay intact. Not necessarily the dollar but the banker controlled fiat system holding the markets together with either a world currency or a group of regional currencies. The dollar might still exist as a regional system but its impact to support the current militarist expansionist policy (Western-centric) will end. The system will have its banking driven increasingly through central banks in China, Russia, and Europe. Africa and South America will have to decide which alliance will provide them "protection" from further predatory capitalism. Look around you now if you are a "developing" country with upheavals, civil wars, regime overthrows, and assassinations....what would you do? Can they still swallow the line "we're here to protect you"? So the switching of global alliances (see Currency Swaps) will become increasingly apparent and increasingly desperate.
So how do you make money?CONfidence must be restored to our currency and you don't restore confidence at the end of a rifle...you only create FEAR and DISTRUST! If you believe fear can back your currency and country then you should stay fully invested in USD paper plays. If you believe that CONfidence cannot be maintained then the USD is going to experience a massive reset and it could even happen within this year. Why do you think China is scrambling for gold and silver. Its real money and they hold way too many USD in their reserves. You just can't go out an order a few hundred billion in gold to protect yourself. ITS NOT THERE. That is why it gold or "real money". You might manipulate it in terms of price for awhile but not forever and the "catching up" can be staggering. China is in a fix. It needs gold and has been fighting to get it for several years without setting off a rush for gold. The central banks need for controlled low gold headline price and China's strategic need for gold bullion were not opposing, but the lack of available bullion is putting an end to this game. Both parties would be happy to allow this game to continue further but both side know when the door closes it will be virtually overnite.
This post is dedicated to "Lil Brown" a woman that was never going to stand down......gl Lil
.“They who can give up essential liberty to obtain a little temporary safety deserve neither liberty nor safety.”
― Benjamin Franklin, Memoirs of the life & writings of Benjamin Franklin