What is going on with our financial system? Since the last post I have invested much time in the financial blogosphere seeking an understanding of how the system works. It is a subject that is alternately arcane and exceedingly simple. Money is something we take for granted. We rarely stop to think about it. The deeper questions of how it is created, how it is managed on a macro level, and who gets to benefit most from having their hands in the gears, is an eye opening subject.
It is an especially important topic these days because our financial system appears to be in a precarious state. Everybody knows this, yet there is much disagreement on the degree of danger.
From the mainstream news channels, it’s business as usual, trying to reassure a concerned public that a recovery is just around the corner. In the ‘alternative’ financial news, the reports from the front lines are deafening. My personal sense, having given up on the propaganda of the corporate controlled media, is that we’re headed for a real bruiser.
Most people don’t seem to be paying much attention to it, thinking that we’re just in another one of those nasty cyclical downturns, but eventually will rise above. It’s easy to lull ourselves into this type of thinking. We’ve always kept our heads above water, so why wouldn’t we pull it off again? Sure, some people suffer, but aren’t we on a long trajectory, a rising tide that will once again lift all boats? Isn’t that the glory of our wonderful American dream of endless financial well-being? Aren’t we entitled to have that?
The problem is, various chickens are coming home to roost and our nest is getting so fouled that we are near to abandoning the hen house. The stench of fraud, manipulated markets, impossible debt loads, currency plunder through massive money printing, zero interest rates, and all manner of financial chicanery is soon to bring the house down.
The only people that can’t see this are those that are living in denial. The evidence that we are at the edge of an abyss is irrefutable. We can look away, whistle for better times, or have faith that our central planners will keep playing the music so our Titanic doesn’t go down, but that is delusion.
The reason it is a delusion is that we have been conned by a gigantic Ponzi scheme created by a nasty and greedy group of banksters. This scheme has been running since 1913 when the Federal Reserve was formed to print money and loan it to the US government as debt. These central planners, the moneyed men of their era succeeded in wresting power away from the American people and created a form of debt slavery that is strangling this country, and indeed most of the world today. Their fiat money creation, now no longer backed by gold has been a license to print whatever volume of money they desire and to funnel it into untold wars, subterfuge and black ops.
This scheme has only one outcome. It is now reaching an apex, as the amount of debt having been created by governments and people is so great that interest payments on this debt can no longer be serviced. Instead of reducing this debt and thus the interest payments, the central planners have decided to flood the system with more debt-based money and thus create inflation. The end result, as has happened when other empires have fallen, is economic collapse via hyper-inflation or currency devaluation.
The asset base on which to create new debt money has not expanded to keep up with the amount of money creation. Instead, as part of the fiat system, the banksters have re-hypothecated these assets many times over and used them as collateral again and again. At some point this fraud will be exposed and the underlying assets revealed as having been pledged too many times. When the music stops, there will be no chairs to sit down on.
This game of musical chairs or house of cards is in an extremely vulnerable state. Who knows what the tipping point is. It could be a war, one large failed bank, a sovereign default, food riots, or a weather catastrophe. Nobody knows.
However, more and more people are realizing it’s not a question of if, it’s a question of when.