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Doug Casey on the Imminent Bankruptcy of the US Government
Doug Casey on the Imminent Bankruptcy of the US Government
The US government’s budget is the biggest in the history of the world and is growing at an uncontrollable rate.
Below is a chart of the budget for the most recent fiscal year, which had a deficit of nearly $1.7 trillion.
Before we get into the specific items in the budget, what is your take on the Big Picture for the US budget?
Doug Casey: The biggest expenditure for the US government are so-called entitlements. It’s strange how the word “entitlements” has been legitimized. Are people really entitled to the government paying for their health, retirement, and welfare? In a moral society, the answer is: No. Entitlements destroy personal responsibility, legitimize theft, destroy wealth, and create antagonisms.
The fact is that once people have an “entitlement,” they come to rely on it, and you can’t easily take it away. The Chinese call that breaking somebody’s rice bowl. In the case of the American welfare state, it’s more a question of breaking a whipped dog’s doggy bowl. It’s a shame because many have come to rely on their mother, the State, not entirely through their own fault. The US has become pervasively corrupt.
The World Economic Forum (WEF)—a pox upon them—isn’t entirely incorrect when it arrogantly calls most people “useless mouths.” An increasing number produce absolutely nothing but only consume at the expense of others. Courtesy of the State.
…click on the above link to read the rest…
Doug Casey on How Economic Witch Doctors Convince Everyone They’re Neurosurgeons
Doug Casey on How Economic Witch Doctors Convince Everyone They’re Neurosurgeons
International Man: The average person doesn’t care about economics. But to the extent that he does, he only reads mainstream publications like The Economist and editorials in The New York Times.
In these publications, the average person will find so-called economists advocating upside-down and destructive concepts like negative interest rates, banning cash, debt-fueled consumption, government spending, and rampant money printing as the cures to economic ailments.
And if those methods don’t work—or inflict damage—the establishment economists’ response is to simply call for more money printing, more debt, and even lower interest rates.
What’s your take on conventional economic thinking and methods?
Doug Casey: Frankly, most “economists” today are only political apologists masquerading as economists.
An economist is somebody that describes the way the world works—how people go about producing, consuming, buying, selling, and living their lives. That’s not, however, what most of today’s PhD economists do. Instead, they prescribe the way they would like the world to work and tailor theories to help politicians demonstrate the virtue and necessity of their quest for more power.
As a result, legitimate economics barely exists today. What passes for economics has a very bad reputation, and it’s well deserved. Economics has become degraded. It’s not quite a laughingstock like gender studies, but it’s on a level with political science—which isn’t a science at all.
Every individual has vastly differing likes and dislikes and wants and needs. But these so-called economists like to treat people as if they were standardized atoms. They think they can manipulate people as if they were chemicals and treat the economy as something they can heat up or cool down. And they’re the ones who decide what the masses need.
Economics has become an excuse for central planning, and economists have become social engineers.
…click on the above link to read the rest…
Doug Casey on the Death of Privacy… and What Comes Next
Doug Casey on the Death of Privacy… and What Comes Next
International Man: In practically every country, the allowable limit for cash withdrawals and transactions continues to be lowered.
Further, rampant currency debasement is lowering the real value of these ridiculous limits.
Why are governments so intent on phasing out cash? What is really behind this coordinated effort?
Doug Casey: Let me draw your attention to three truths that my friend Nick Giambruno has pointed out about money in bank accounts.
#1. The money isn’t really yours. You’re just another unsecured creditor if the bank goes bust.
#2. The money isn’t actually there. It’s been lent out to borrowers who are illiquid or insolvent.
#3. The money isn’t really money. It’s credit created out of thin air.
The point is that cash is freedom. And when the State limits the utility of cash—physical dollars that don’t leave an electronic trail—they are limiting your personal freedom to act and compromising your privacy. Governments are naturally opposed to personal freedom and personal privacy because those things limit their control, and governments are all about control.
International Man: Governments will probably mandate Central Bank Digital Currencies (CBDCs) as the “solution” when the next real or contrived crisis hits—which is likely not far off.
What’s your take? What are the implications for financial privacy?
Doug Casey: CBDCs are proposed as a solution, but in fact, they’re a gigantic problem.
Government is not your friend, and CBDCs are not a solution.
If they successfully implement CBDCs, it would mean that anything you buy or sell, and any income you earn, will go through CBDCs. You will have zero effective privacy. The Authorities will automatically know what you own, and they’ll be in a position to control your assets. Instantly.
…click on the above link to read the rest…
Doug Casey on How Governments Use Global Crises to Take More Control
Doug Casey on How Governments Use Global Crises to Take More Control
International Man: Throughout history, governments have used crises—real or imagined—to eliminate freedoms, expand the power of the State, and justify all sorts of things the populace would never accept in normal times.
After World War II, Winston Churchill famously said, “Never let a good crisis go to waste.”
This was when he and other leaders came together to form the United Nations, which they probably could not have created without the crisis of WWII.
Ever since, it seems that each new supposed crisis causes a further centralization of global power.
The War on (Some) Drugs, the War on Terror, the COVID hysteria, and the so-called climate crisis have all ratcheted up the centralization of power on a global scale.
What do you make of this trend?
Doug Casey: It makes sense that Rahm Emanuel, a sleazy Obama apparatchik, would have stolen the phrase from Churchill. But the statement is quite correct, regardless of the source. Government lives on crisis. As Randolph Bourne said, “War is the health of the State,” and there’s no crisis like a war. But any kind of crisis can work.
Whenever you have a crisis—whether it’s a military, political, economic, financial, or social crisis—the mob calls for strong leaders to kiss it and make it better.
This plays perfectly into the hands of the kind of people who work for the State. As far as I’m concerned, it’s a psychological flaw in humans, stemming from the fact that we’re pack animals.
Pack animals want leaders.
I’m not sure how we solve this problem other than delegitimizing the idea of the State and defanging it as much as possible. And stop lauding, even apotheosizing, its employees…
…click on the above link to read the rest…
Unsound Banking: Why Most of the World’s Banks Are Headed for Collapse
Unsound Banking: Why Most of the World’s Banks Are Headed for Collapse
You’re likely thinking that a discussion of “sound banking” will be a bit boring. Well, banking should be boring. And we’re sure officials at central banks all over the world today—many of whom have trouble sleeping—wish it were.
This brief article will explain why the world’s banking system is unsound, and what differentiates a sound from an unsound bank. I suspect not one person in 1,000 actually understands the difference. As a result, the world’s economy is now based upon unsound banks dealing in unsound currencies. Both have degenerated considerably from their origins.
Modern banking emerged from the goldsmithing trade of the Middle Ages. Being a goldsmith required a working inventory of precious metal, and managing that inventory profitably required expertise in buying and selling metal and storing it securely. Those capacities segued easily into the business of lending and borrowing gold, which is to say the business of lending and borrowing money.
Most people today are only dimly aware that until the early 1930s, gold coins were used in everyday commerce by the general public. In addition, gold backed most national currencies at a fixed rate of convertibility. Banks were just another business—nothing special. They were distinguished from other enterprises only by the fact they stored, lent, and borrowed gold coins, not as a sideline but as a primary business. Bankers had become goldsmiths without the hammers.
Bank deposits, until quite recently, fell strictly into two classes, depending on the preference of the depositor and the terms offered by banks: time deposits, and demand deposits. Although the distinction between them has been lost in recent years, respecting the difference is a critical element of sound banking practice.
…click on the above link to read the rest…
Doug Casey on the Likelihood of Nuclear War With Russia
Doug Casey on the Likelihood of Nuclear War With Russia
International Man: Recently, we’ve seen what appears to be an escalation in the conflict between Russia and Ukraine.
There is an excellent chance the US government was behind the sabotage of the Nord Stream pipelines, Russia has annexed four regions of Ukraine, and President Zelensky announced an accelerated bid to join NATO.
What do you make of this?
Doug Casey: I’d say that the odds are extremely high, approaching certainty, that the US was complicit in the sabotage. It certainly had the Motive, Means, and Opportunity—the three elements necessary to warrant suspicion in a criminal investigation.
The US has unique capabilities for this kind of mischief—an air-launched drone torpedo or a submarine aren’t available to just any terror group. It was a major operation, not something that a few scuba divers could pull off. Apparently, tons of explosives were used to blow these things up.
Biden and other US officials previously said they didn’t want the Nord Stream to go through and planned to prevent it. A boldly idiotic thing to say since the pipeline is neither its property or business.
The narrative that the Russians did it is completely insane. Putin could simply turn off the gas until it was convenient to be turned back on; now that option is gone. The Russians wouldn’t limit their own options.
If it’s proven that the US did it, then the Russians and/or the Germans will have to engage in a tit-for-tat retaliation to punish the US for this sabotage. That may be tantamount to an act of war, but once the culprit is proven, they have to take action. This thing isn’t over. The culprit will be found.
…click on the above link to read the rest…
Doug Casey on the Next “Crisis” the Global Elite Have Planned
Doug Casey on the Next “Crisis” the Global Elite Have Planned
International Man: Every year, the international ruling class—the most influential world leaders, CEOs of big corporations, top academics, and even celebrities—come together at Davos. They discuss topics that interest them and prescribe their preferred policies.
What’s your take on the Davos crowd and what they are doing?
Doug Casey: The Davos crowd has become the most visible element of the ruling class. Although, they overlap with lots of other groups who are pushing the same agenda—Bilderberg, CFR, and Bohemian Grove among them.
A couple of years ago, I wrote an article after I attended the Concordia, which is very similar, with exactly the same people. I don’t plan on going back. It was disturbing and depressing listening to soulless bigshots natter about the best way to rule the plebs.
These people are all part of what you might call the “World Deep State.” They all know each other. They go to the same conferences, and more often than not, they’ve attended the same universities, belong to the same social clubs, and have kids in the same schools.
But most importantly, they share the same worldview. They live in their own little silo, where the rest of 7.9 billion people in the world are outsiders. So it’s only natural that people in such a relatively close-knit—albeit informal—group conspire.
Adam Smith famously observed that whenever two men from the same occupation get together, they always conspire against the interests of the public. It’s a perfectly normal and natural thing.
But these people aren’t just merchants contriving to make a few extra shekels. These people are the top dogs in all of the world’s governments, NGOs, corporations, universities, and media organizations…
…click on the above link to read the rest of the article…
Will it be an Inflationary or Deflationary Depression?
Will it be an Inflationary or Deflationary Depression?
At some point, the economy is no longer controlled by individual citizens in the marketplace but by government “planners,” who find they have only one of two alternatives: stop “stimulating” and permit a full-scale credit collapse, or continue stimulating until the dollar loses all value and society breaks down.
Depending on which they choose, we will have a depression characterized by deflation or by hyperinflation.
Deflationary Depression
This is the 1929-style depression, where huge amounts of inflationary credit are wiped out through bank failures, bond defaults, and stock and real-estate crashes.
Before 1913 (the inception of both the Federal Reserve and the income tax), having the dollar pegged to gold (at $20 an ounce) inhibited the scale of monetization.
When depressions of this type occurred, depositors acted quickly to collect their money; they had no illusion that the government would bolster their banks; once the banks ran out of gold, their bank accounts were worthless.
Their quick response and the fact that the federal government could not monetize its deficit spending as freely as it now can forced the market to correct distortions rapidly.
Until the 1930s, depressions were sharp but brief.
They were short because unemployed workers and distressed business owners were forced to lower their prices and change their business methods to avoid starvation.
The 1929 Depression was deeper and more widespread than any before it since the Federal Reserve (by becoming the lender of last resort) allowed banks to maintain far smaller reserves than ever before.
By backing the dollar with Reserve Bank IOUs instead of gold, the money supply could be increased enormously, and large distortions could be built into the economy before a depression liquidated them.
…click on the above link to read the rest of the article…
Why the US Is Headed into Its Fourth Turning
Why the US Is Headed into Its Fourth Turning
International Man: The economic, political, social, and cultural situation seems to have become increasingly volatile in the United States and more broadly in the West. Is this a unique situation or part of a recurring historical cycle?
Authors William Strauss and Neil Howe introduced a popular theory in their book, The Fourth Turning, outlining the recurring generational cycles that have occurred throughout American history.
What are your thoughts?
Doug Casey: I read Strauss and Howe’s first book, Generations, when it came out back in 1992. I thought it was brilliant.
Let me start off by recommending both Generations and The Fourth Turning to everybody. Both books offer quite a scholarly, readable, and prescient view of the cyclicality of history. And offer a very plausible forecast for the 2020s.
History’s best seen as cyclical, rather than a straight-line progress to some preordained end the way both the Marxists and the Abrahamic religions see it. But then, Ecclesiastes has its famous quote that there’s nothing new under the sun.
Plato in the Republic talks about how the younger generation—and we’re talking fourth century BC—can’t stand up to the moral values of their forefathers.
Older people have always thought that the younger generation wouldn’t quite measure up. In recent American history, you’ll recall, the younger generation were the beatniks in the ’50s, the hippies in the ’60s, and the yuppies in the ’80s—so it’s a passing parade. Older people have a tendency to think the world is going downhill. Nothing new there. But there’s always a rebirth.
Niccolò Machiavelli, in his Florentine Histories, said:
Virtue gives birth to tranquility, tranquility to leisure, leisure to disorder, disorder to ruin… and similarly from ruin, order is born, from order virtue, from virtue, glory and good fortune.
…click on the above link to read the rest of the article…
Doug Casey on What the International Ruling Class Have Planned for You
Doug Casey on What the International Ruling Class Have Planned for You
International Man: No matter the problem, the prescription of the Davos crowd is always more welfare, more warfare, more money printing, more taxes, and of course, more centralization of power into global institutions.
What’s your take?
Doug Casey: The people who attend Davos are all welfare statists. They’re not necessarily socialists, insofar as they don’t want to see government nationalize industries. Most understand how totally dysfunctional that is and that they don’t really benefit from it. Strict socialism, defined as State ownership of the means of production, is off the table. They prefer economic fascism, where a powerful State can funnel wealth to the corporations the elite own or control. They’re happy to throw some table scraps to the unwashed masses, of course. Modern Monetary Theory (MMT) is the best way to do that.
Again, they’re not socialists. They’re welfare statists. Completely opportunistic and absolutely unprincipled. Despicable people, actually. Few are entrepreneurial, independent thinkers or free-market oriented. Those types would be disruptive at Davos, and if they’re ever invited, it would be only once.
Other than celebrities, court intellectuals, and publicity-oriented multibillionaires, the attendees are almost all bureaucrats and politicians who thrive on stolen money. But it’s no longer easily visible briefcases full of cash. That’s quaint in today’s world. They steal indirectly, by making sure they benefit from state regulations, state favors, and the inflation of the currency.
Bribes are in the form of tax-deducible donations to charitable foundations and nongovernmental organizations (NGOs). That’s not only much safer, but the money is vastly bigger, and the way it’s rigged adds to their prestige. Both making and taking a bribe disguises the miscreants as philanthropists and do-gooders when they use an NGO as a funnel.
…click on the above link to read the rest of the article…
Doug Casey on the Destruction of the Dollar
Doug Casey on the Destruction of the Dollar
“Inflation” occurs when the creation of currency outruns the creation of real wealth it can bid for… It isn’t caused by price increases; rather, it causes price increases.
Inflation is not caused by the butcher, the baker, or the auto maker, although they usually get blamed. On the contrary, by producing real wealth, they fight the effects of inflation. Inflation is the work of government alone, since government alone controls the creation of currency.
In a true free-market society, the only way a person or organization can legitimately obtain wealth is through production. “Making money” is no different from “creating wealth,” and money is nothing but a certificate of production. In our world, however, the government can create currency at trivial cost, and spend it at full value in the marketplace. If taxation is the expropriation of wealth by force, then inflation is its expropriation by fraud.
To inflate, a government needs complete control of a country’s legal money. This has the widest possible implications, since money is much more than just a medium of exchange. Money is the means by which all other material goods are valued. It represents, in an objective way, the hours of one’s life spent in acquiring it. And if enough money allows one to live life as one wishes, it represents freedom as well. It represents all the good things one hopes to have, do, and provide for others. Money is life concentrated.
As the state becomes more powerful and is expected to provide more resources to selected groups, its demand for funds escalates. Government naturally prefers to avoid imposing more taxes as people become less able (or willing) to pay them. It runs greater budget deficits, choosing to borrow what it needs. As the market becomes less able (or willing) to lend it money, it turns to inflation, selling ever greater amounts of its debt to its central bank, which pays for the debt by printing more money.
David Stockman on the Coming Financial Panic and the 2020 Election
David Stockman on the Coming Financial Panic and the 2020 Election
Doug Casey’s Note: David Stockman is a former congressman and director of the Office of Management and Budget under Ronald Reagan.
Now, anyone with connections to the government should elevate your suspicion level. But as you’ll see, David is a genuine opponent of government stupidity. Although his heroic fight against the Deep State during the Reagan Administration was doomed, he remains a strong advocate for free markets and a vastly smaller government.
We get together occasionally in the summer, when we’re both in Aspen. He’s great company and one of the few people in this little People’s Republic that I agree with on just about everything. Absolutely including where the US economy is heading.
I read his letter the Contra Corner every day and suggest you do likewise.
International Man: We seem to be near the top of the “everything bubble.” Almost nothing is cheap… anywhere. What are your thoughts on where people should put their money for prudence and for profit?
David Stockman: I would recommend recognizing that the “everything bubble” is the most extreme, exaggerated, severe financial bubble in world history. It will inevitably collapse, and there will be massive losses, even greater than occurred in 2008 and 2001.
So, the first thing is to stay out of the casino. By that, I mean the financial-market stocks, bonds, and everything else.
These markets are so artificial. They’re just chasing what the central banks are doing. There’s no honest price discoveries or supply and demand; nobody’s discounting the future of economic growth, productivity, and investment. You’ve got the chart monkeys, 29-year-old day traders who are in charge of the market.
…click on the above link to read the rest of the article…
Doug Casey Debunks Four Myths About Trump, Taxes, and the Economy
Doug Casey Debunks Four Myths About Trump, Taxes, and the Economy
International Man: For many years, President Trump has made no apologies for trying to pay the least amount of taxes possible. He’s clearly stated this in many interviews.
His desire to minimize his taxes has brought scorn from many in the mainstream media, and politicians from both sides of the aisle. These people are of the opinion that paying taxes is an honorable and necessary responsibility. It brings to mind the wrongheaded saying “taxes are the price we pay for a civilized society”, which came from US Supreme Court Justice Oliver Wendell Holmes. Many people believe this.
But if that’s true, how come low tax locales like Singapore, the Cayman Islands, Monaco aren’t backward hell holes, but rather sophisticated and civilized?
Doug Casey: Almost any lie can be accepted as truth if it’s said often enough and with enough certainty. That absolutely applies to what Holmes said. It’s shameful how people don’t think about its meaning, but slavishly repeat it.
Taxes aren’t the price we pay for civilized society. They’re a sign of the fact that society is becoming uncivilized. A civilized society is based on voluntarism. Taxes are all about coercion.
People don’t seem to recognize or remember that before 1913 there was no income tax in the US. There was no reporting of any kind to the US government. It was a much more civilized and far freer country then.
As far as Trump minimizing his taxes, congratulations to him. The object should be to cut the size of the US government in half, and cut it in half again, and again. And along with it, cut the tax burden that it imposes on the average American.
…click on the above link to read the rest of the article…
Doug Casey: The Deep State Is the Source of Our Economic Problems
Doug Casey: The Deep State Is the Source of Our Economic Problems
Justin’s note: As longtime readers know, Doug Casey says we’re well into what he calls the Greater Depression.
America is headed for trouble… and it’s critical to know exactly what’s going on.
That’s why today’s essay is so important. In it, Doug explains the source behind every negative thing that’s happening right now… and what’s really going on behind the scenes.
It’s one of the most educational and entertaining pieces you’ll read all year.
I’d like to address some aspects of the Greater Depression in this essay.
I’m here to tell you that the inevitable became reality in 2008. We’ve had an interlude over the last few years financed by trillions of new currency units.
However, the economic clock on the wall is reading the same time as it was in 2007, and the Black Horsemen of your worst financial nightmares are about to again crash through the doors and end the party. And this time, they won’t be riding children’s ponies, but armored Percherons.
To refresh your memory, let me recount what a depression is.
The best general definition is: A period of time when most people’s standard of living drops significantly. By that definition, the Greater Depression started in 2008, although historians may someday say it began in 1971, when real wages started falling.
It’s also a period of time when distortions and misallocations of capital are liquidated, and when the business cycle, which is caused exclusively by currency debasement, also known as inflation, climaxes. That results in high unemployment, business failures, uncompleted construction, bond defaults, stock market crashes, and the like.
Fortunately, for those who benefit from the status quo, and members of something called the Deep State, the trillions of new currency units delayed the liquidation. But they also ensured it will now happen on a much grander scale.
The Deep State is an extremely powerful network that controls nearly everything around you. You won’t read about it in the news because it controls the news. Politicians won’t talk about it publicly. That would be like a mobster discussing murder and robbery on the 6 o’clock news. You could say the Deep State is hidden, but it’s only hidden in plain sight.
…click on the above link to read the rest of the article…
Stupidity, Evil and the Decline of the US
Stupidity, Evil and the Decline of the US
It used to be that America was a country of free thinkers.
“Say what you think, and think what you say.” That’s an expression you don’t hear much anymore.
It’s much more like the world of 1984 where everything is “double think.” You need to think twice before you say something in public. You think three times before you say something when you’re standing in an airport line.
Regrettably, the US is no longer the land of the free and the home of the brave. It’s become the land of whipped and whimpering dogs that roll over on their backs and wet themselves when confronted with authority.
Now, why are Americans this way? Let me give you two reasons—though there are many more.
First, there’s a simple absence of virtue. Let’s look at the word virtue. It comes from the Latin vir, which means manly, even heroic. To the Romans, virtues were things like fortitude, nobility and courage. Those virtues are true to the root of the word.
When people think of virtues today they think of faith, hope, charity—which are not related to the word’s root meaning. These may pass as virtues in a religious sense. But, outside a Sunday school, they’re actually actually vices. This deserves a discussion, because I know it will shock many. But I’ll save that for another time.
An absence of virtues and the presence of subtle vices is insinuated throughout society. Worse, overt vices like avarice and especially envy are encouraged. Envy, in particular will become a big vice in the years to come. It’s similar to jealousy, but worse. Jealousy says “You have something I want; I’ll try to take it from you”.
…click on the above link to read the rest of the article…
