Peter Schiff discusses the Global Debt Ponzi and more

This video of Peter Schiff explaining the truth about the global economy is worth 30 minutes of your time for sure:
https://www.youtube.com/watch?v=mCM7Qj6W_wQ

You’ve heard it before from me, you’ll hear it again, and one day you’ll actually be talking about it with other people:

·         It’s a Global Debt Ponzi.  Period.

o   By the way, the Economati BlogSpot was the #1 hit on Google for the search terms global debt Ponzi last week.  This week it is #3 and #4.  And that’s without me having any ads on the blog and zero work done on setting up search terms, etc.

·       The game is over as soon as others won’t buy our debt cheaply.  You will know this is the case when interest rates rise again.

·        We will eventually default on everyone either through outright default or through massive inflation.

·        Government has thrown the kitchen sink at the problem and all they’ve succeeded in doing is getting the economy to the point where it feels like a really bad recession.  In order to keep things sliding to only this level they have had to do unprecedented and unsustainable things.  They have had to ignore their own rules ("regulatory forbearance").  Nothing has been fixed, the can has just been kicked down the road.

·        Those exporting to us are running a vendor finance scam.  I've written this dozens of times starting back in 2007.

·        The real economic purpose of exports is supposed to be trade.  The real value of trade is diversity of consumption which allows people to specialize, get good at producing a small number of things which allows them to efficiently overproduce.  The excess production is then exported to someone else in exchange for receiving what the trading partners specialize in.  In this way, everyone doesn't have to know everything but everyone gets to benefit from the fact that someone, somewhere is really good at producing some item that you don't produce and that you don't want to learn how to produce or to spend money on re-inventing someone else's production "wheel".  Using exports as a mechanism to try to get ahead is economically impossible, period.  Anyone who exports more than they import is collecting IOUs for the excess and that is the definition of vendor financing.  Vendor financing at the levels we are talking about here is a scam. 

 

Everything Schiff says is based on sound, real life economics.  Forget the vaporous models and formulae of academic economists.  Their only goal is to keep their job.  So they become the captured mouthpieces of the government agenda.  Academia is the marketing arm of corrupt government's funny money scheme. 

 

The part where Schiff might be missing something is that China is corrupt, Canada is also corrupt, everyone is corrupt.  So there is no “better” place than the USA as he seems to believe.  All global governments are in the same sheep dip because they all use the same fraudulent money supply.  Sure, they have different names for their pieces of fraudulent paper than we do but that doesn't change the nature of the fraud.  Each player has a slightly different take on the scam. 

 

• The US is the recipient of other people's goods which we "pay for" with IOUs that we can never cover with real goods.  Our goal in the scam is to get something for nothing.  In other words, we want to benefit from their labor without paying for it.  That used to be called slavery.  Today it is called global economics.
• The Chinese are playing the game from a different perspective and with different goals. China's massive export machine was only possible because they leveraged up on debt in order to create production capacity that was faaaar in excess of their own ability to consume.  So they HAVE to sell it to someone in order to service their own debt.  Same with Japan.  Those factories were not bought, they were borrowed.  If you don’t service the debt on your plant, someone shuts it down and sells the equipment in order to recoup whatever they can from their loan.  China believes that when it all collapses that nobody will be able to come onto Chinese soil and repossess all of the financed buildings and factories, etc.  Thus, when the new money system takes over, they will have real production capacity that has no debt associated with it because the debt will have been wiped out by bankruptcy while the equipment will have been confiscated by a sovereign, nuclear capable nation.

 

Schiff thinks the US is worse off than others.  I strongly disagree.  The con men in the US will hold their own against the con men in other places for decades to come.  We have the dream team of lying, crooked moneymen.  The coins and small change that roll off of the stolen cash pile that’s sitting on their table go directly into the US economy.  And if that doesn't work we will simply kill anyone who disagrees with us in the name of national security.  If there is one thing that the US is clearly the world's greatest exporter of, it's military power.