A few days ago, my daughter referred to me in an email, as pessimistic. I sighed.
It is true that I am very clear, and will say it to anyone that asks, that I believe that the current ‘monetary’ system will collapse. I have been saying as such for over ten years. If pressed, I will also state unequivocally, that the economies of the whole world are in big trouble and that they will continue to deteriorate until the whole system collapses and, at that point, we will revert back to tribal economies.
Pessimistic? Absolutely not. I regard myself as a great optimist.
Realistic? Without a doubt.
To assert a mathematical certainty does not make one a pessimist. Two plus will continue to equal four, no matter how much an ‘optimist’ would like it to equal five.
The debt burden hanging over the world cannot ever be repaid. Not because of the collapsing economy, not even because of the profligacy of governments, but because the system does not allow for it to be repaid. It was a flawed model from the start – and known to be. Hence, when questioned about the long run, its architect Lord Keynes said “… in the long run we are all dead.”… chuckle, chuckle. In the fiat currency model under which we all currently labour, there is no extinguisher of debt. It is literally impossible for the debt to be paid. And now we have reached the ‘long run’. And Lord Keynes was correct on that point; all those people are dead. We are not.
All that anyone can do now is to try to shift the debt elsewhere. But eventually it will not matter where the debt is positioned. It will collapse and, unless we move quickly to Gold bonds before that happens, so will Western Civilization. At that point, who owns the debt will be rather moot.
The present head of the Federal Reserve Bank in the US, the only central bank that really matters, has indicated in no uncertain terms that he does not want an extinguisher of debt. He either does not have the monetary knowledge to understand the problem, or he lacks the courage to implement the solution. Either should disqualify him from the job.
Dear daughter, if I were a pessimist I would not have spent the last ten years of my life trying to remedy a problem that the vast majority, including possibly the head of the Federal Reserve, do not even understand exists. It is only my absurdly high level of optimism that keeps me going.
I am totally convinced that the solution will be implemented, the only question is: will it be in time?