Posts Tagged ‘currency collapse’
by stuartbramhall in The Global Economic Crisis
Below is a link to an excellent hour long interview with Max Keiser on Bonnie Faulkner’s Guns and Butter.
Although Keiser, a former Wall Street broker (and fellow expatriate living in France), is extremely knowledgeable about Wall Street and global banking, I find his own programs on RT and Press TV a little frustrating because they are usually limited to a brief overview and tend to be full of quantum leaps.
Faulkner is a superb interviewer and is great at pinning him down when he doesn’t explain himself clearly. Although he makes several points I disagree with, the interview provides an excellent overview of all the factors contributing to an extremely unstable global economy.
Keiser makes an analogy between the current precarious position of global currency and an impending avalanche. All it will take is one snowflake, one minor financial crisis somewhere, and the whole house of cards will come tumbling down. This relates in part to hundreds of trillions of dollars of worthless money that has been created as government debt, but even more to trillions of dollars of speculative derivatives created by investment banks since 2008.
J.P Morgan Chase isn’t the only investment bank that’s technically insolvent (i.e. that has more debt on their books than assets). They all are. And because industrial society is totally dependent on private banks to create the money we exchange for goods and service, the whole economy will collapse when they do.
Keiser seems to think a hyperinflation event (like they had in post-World War I Germany and recently in Zimbabwe) is most likely. George Soros and other billionaires and millionaires (and China) seem to agree, which is why they’re dumping their stocks like mad to buy gold. He also reports that China is dumping their US Treasury Bills and dollar reserves.
Historically people have used gold to buy groceries when their money becomes worthless. I’m not sure hoarding gold will work this time – not when grocery shelves are empty due to the global food (and water) crisis.
Keiser says it’s difficult to predict the exact timing of the collapse. He identifies April 2013 as a potential date, as US income tax returns are due April 15th. He predicts the abysmal tax take will cause the dollar to collapse. I question this reasoning, as only a tiny fraction of Americans wait till April to pay their taxes. The IRS requires employers to submit withholding taxes on a monthly basis, whereas self-employed Americans are required to submit quarterly estimated payments.
My favorite part of the interview is where Keiser predicts the collapse of the US military – which burns as much oil as most countries – when gasoline hits $12 a gallon.