USA borrows half of what it spends, and has gone trillions in debt to fund wars, destabilization, etc. Our Keynesian economic policy, which the govt economists believe in, was expected by the powers to be to trap the Chinese: they make things for us, we pay them in funny money, they become enslaved to our funny money.
Ooooops. We went too far. Currency needs to be tied to hard assets, money. Gold and silver. The hegemon made a mistake. They believed their own bad economics and redefined money and currency to help accomplish this. Now comes this...
The Chinese outfoxed our economists by relatively backing their currency in gold. USA currency is backed in fiat, asset-less nominal values.
Think Japan today. A friend tells me Japan is 1/3rd off from last year, meaning my money will go 50% farther if I visit. Importing from Japan just got a lot cheaper. But his debts are all denominated in yen. It takes fewer dollars to buy they yen to buy the same goods today as last year.
So my friend sees dollar deflation in Japan. He feels nothing different in his life, its just it takes fewer dollars in this int'l transaction. If and when USA products become "cheaper" more people will start making things for export. Inside USA what dollars will be in demand will before dollar denominated debt, which people will either not take on or not be able to pay. The demand for dollars will drop.
The implications here blow my mind, and I have been travelling, etc. I'll work on this...
Update: as they said in the earlier point on the WIR, it is counter-cyclical. Here is the confusion: people think of the dollar as money, when it never was. it is a tally of non-asset backed financials. Think of real estate: is the bottom of the market low price? No! The bottom is no customers. The dollar will not go into hyperinflation as long as it is freely convertible in to countless currencies and useful for paying debts, but it is not money, and it is fraudulent. So it necessarily has to be liquidated, in teh sense of eliminated, at some point. This will be well managed domestically if the WIR is allowed to grow, and it will take fewer WIRs to buy things in usa than dollars. There it is, the deflation will be marked in USA WIRs, as the dollar is necessarily liquidated along with its bogus valuation based on non-assets plus the risible liability side of USA Pensions. There it is... and the Chinese are in charge now.
Ungh! It is so sad capitalists do not understand economics as well as communists. But neither will permit free markets. Whaddya gonna do? Keep a sense of humor I was advised yesterday.
Feel free to forward this by email to three of your friends.
Ooooops. We went too far. Currency needs to be tied to hard assets, money. Gold and silver. The hegemon made a mistake. They believed their own bad economics and redefined money and currency to help accomplish this. Now comes this...
On March 24, 2015, Euronews broadcasted Business Middle East, in which Nour Al Hammoury from ADS securities, stated that if Chinese banks would join the new gold fix it would be less sensitive for manipulation. Having Chinese banks participate in the fix, would indeed be very welcome.The Chinese communists know that money is gold and silver, not currency. Note in the article the strange phrase "hyper-devaluating dollar cash-out " in the comments section. What he means is credit deflation.
The Chinese outfoxed our economists by relatively backing their currency in gold. USA currency is backed in fiat, asset-less nominal values.
Think Japan today. A friend tells me Japan is 1/3rd off from last year, meaning my money will go 50% farther if I visit. Importing from Japan just got a lot cheaper. But his debts are all denominated in yen. It takes fewer dollars to buy they yen to buy the same goods today as last year.
So my friend sees dollar deflation in Japan. He feels nothing different in his life, its just it takes fewer dollars in this int'l transaction. If and when USA products become "cheaper" more people will start making things for export. Inside USA what dollars will be in demand will before dollar denominated debt, which people will either not take on or not be able to pay. The demand for dollars will drop.
The implications here blow my mind, and I have been travelling, etc. I'll work on this...
Update: as they said in the earlier point on the WIR, it is counter-cyclical. Here is the confusion: people think of the dollar as money, when it never was. it is a tally of non-asset backed financials. Think of real estate: is the bottom of the market low price? No! The bottom is no customers. The dollar will not go into hyperinflation as long as it is freely convertible in to countless currencies and useful for paying debts, but it is not money, and it is fraudulent. So it necessarily has to be liquidated, in teh sense of eliminated, at some point. This will be well managed domestically if the WIR is allowed to grow, and it will take fewer WIRs to buy things in usa than dollars. There it is, the deflation will be marked in USA WIRs, as the dollar is necessarily liquidated along with its bogus valuation based on non-assets plus the risible liability side of USA Pensions. There it is... and the Chinese are in charge now.
Ungh! It is so sad capitalists do not understand economics as well as communists. But neither will permit free markets. Whaddya gonna do? Keep a sense of humor I was advised yesterday.
Feel free to forward this by email to three of your friends.
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