The spiraling lack of trust is destroying the credit system. The M1 multiplier (see Fed reserve site) is at .81 and continues to plunge.
The Fed is finding to its dismay that the real currency is Trust, not the dollar.
That’s a key point. America historically attracted capital and investment because of that trust - safety, in the form of an established legal system, rule of law, respect for property rights and enforced equitably, etc. Mom, Dad, Apple Pie and Chevrolet. Money always and ever goes to where it’s treated best. I don’t think politicians can ultimately change that.
Great point. For all their command and control schemes, they cannot force the world to hold dollars.
The Fed is finding to its dismay that the real currency is Trust, not the dollar.
GRRRREAT post, Vet_6780!
Watch money. Money is the barometer of a society’s virtue. When you see that trading is done, not by consent, but by compulsion—when you see that in order to produce, you need to obtain permission from men who produce nothing—when you see that money is flowing to those who deal, not in goods, but in favors—when you see that men get richer by graft and by pull than by work, and your laws don’t protect you against them, but protect them against you—when you see corruption being rewarded and honesty becoming a self-sacrifice—you may know that your society is doomed. - Ayn Rand
Have you seen this thread?...(thanks dennisw)...
In letting the derivatives market grow to the size it did with little tracking or transparency, De Soto says, Americans breached a law so fundamental that it is unwritten. In the West, ever since feudalism collapsed, “the market made an effort to record everything so that paper meant something,” he notes. This happened without the mandate of any central government. “If I asked you, where is the ministry of property in the U.S.? You’d say we have no ministry of property. Sometimes you don’t need it.”Yet title to every house, car, mortgage, bank account and patent had always been reliably documented. “It’s not a fundamental law written into your constitution but an unwritten law that you have not respected, which is that paper means something,” he says.
Much, much more...here...
http://www.freerepublic.com/focus/f-news/2406524/posts
To dovetail your comment...
In the link I gave you (above)...if you go to that thread...click on post #11 - which takes you to zero hedge...
...then, click on 02. Flawed Economic Model
Look at the 17:22 (De Soto’s opening comment) minute mark just past the 20:00 minute mark (the end of De Soto’s opening comment...”paper fails to represent assets”)
Enjoy