So you think the market isn’t smart enough to figure out inflation and charge real interest rates? The market is smart enough.
You think interest rates discipline Congress? Forces them to reign in deficits? No. It doesn’t. They can still borrow they can still commit your kids to unreasonable burdens. They can still bankrupt the country.
The problem is congressional spending, and a gold standard does absolutely nothing to reign that in.
Only electing fiscally responsible leaders of good character is going to protect us. Gold standard just leaves our currency open to manipulation by Soros and China. China by the way is currently the largest gold producer in the world.
Yes - that's my whole point. The Market should set interest rates. Do you think the market is setting them now???? Right now, you have the FEDERAL RESERVE setting interest rates by massively pumping printed money into Gov't bonds and its Primary Dealer Banks. They have called it their ZIRP (Zero Interest Rate Policy).
You think interest rates discipline Congress? Forces them to reign in deficits? No. It doesn’t. They can still borrow they can still commit your kids to unreasonable burdens. They can still bankrupt the country.
Sorry, but this statement is incorrect. As mentioned, The FED is keeping interest rates at near zero. They are trying to stimulate private borrowing, while at the same time allowing the US Gov't to run a $1.3 Trillion deficit on the cheap.
Now imagine there is no FED buying up cheap Treasury bonds with money they create out of thin air, and imagine that the US Dollar is linked to precious metals with interest rates set by the Market. Could the Gov't run a $1.3 Trillion deficit? No way! Who would buy all those bonds that the FED is buying now? Wouldn't buyers also demand a much higher return?
That is the best discipline on Big Gov't that could exist.
What’s going on here (”the action”) folks:
Their is a POLARITY or divergence (an analyist last week used the word “paradox”....I prefer POLARITY)
Polarity, between household debt contraction (which is govt. resistance), and a real psychopathy of the Federal Governments (euro also), RICO players, and the cast of SO CALLED ‘banking”.
This psychopathy, is what to watch carefully. At the same time the “resistance” (consumer contraction) is forcing downward REAL market pressure, govt.-RICO is maintaining high (very high in comparison) pensions and salaries compensations.
This IS a psychopathy, as the govt-RICO players have no sympathy, but lip-service, to the resulting unemployed. And many who are employed are being thown bones compared to govt.-RICO compensation standards.
Watch the REAL employment numbers (which they tried to fake last week)
Look up the word “Arbeitsziehungslager”, and the momentum conditions that brought this about in history.