{"id":31183,"date":"2018-02-18T18:52:27","date_gmt":"2018-02-18T23:52:27","guid":{"rendered":"http:\/\/olduvai.ca\/?p=31183"},"modified":"2018-02-18T18:52:27","modified_gmt":"2018-02-18T23:52:27","slug":"financial-markets-definitely-destabilizing-charles-hugh-smith","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=31183","title":{"rendered":"Financial Markets Definitely Destabilizing \u2013 Charles Hugh Smith"},"content":{"rendered":"

Financial Markets Definitely Destabilizing \u2013 Charles Hugh Smith<\/span><\/a><\/h3>\n
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\"\"<\/a><\/strong>Financial writer and book author Charles Hugh Smith has been watching the extreme movements in financial markets closely. Is he nervous?\u00a0 Smith says, \u201cOh yeah, it\u2019s definitely destabilizing.\u00a0 In other words, it\u2019s becoming not just more volatile, the whole underlying structure of our economy is destabilizing.\u00a0 What I mean by that is it\u2019s becoming more brittle or fragile.\u00a0 That is fundamentally why we are seeing these wild swings.\u00a0 People are swinging between . . . keeping the money machine like it is for another nine years, and the other side of the coin says wait a minute, we have already had a weak expansion for nine years.\u00a0 <\/span>It\u2019s almost the longest expansion in U.S. history.\u00a0 A normal business cycle doesn\u2019t run in one direction forever. . . .If you don\u2019t allow your economy to have a business cycle recession, then you are simply making it more fragile by encouraging really marginal and risky investments, and that\u2019s where we are now.\u201d<\/p>\n

One very big problem is a dramatic loss in buying power of the U.S. dollar, but it\u2019s not just the dollar. According to Smith, \u201cAll these currencies, there is nothing backing the currencies except the government\u2019s force.\u00a0 That\u2019s the yen, the euro, the dollar and the Chinese yuan.\u00a0 They are all going to have a catastrophic drop against real assets because they are all based on too much leverage, too much debt, too much money being pumped into the financial system that ends up in unproductive speculation.\u00a0 You can\u2019t grow your debt at six times the rate of your economy.\u00a0 In other words, if you are creating $6, $8 or $10 of debt to eke out $1 of low productivity growth, you are dooming your currency, and all currencies are doing the same thing.\u00a0 All the currencies are going to take a big drop at some point . . . relative to real stuff.\u00a0 Real stuff is commodities we need:\u00a0 water, grains, food, oil, natural gas and, of course, precious metals.\u00a0 Everybody knows they have been money for 5,000 years, and I personally feel there is a role for crypto currencies.\u201d<\/p>\n

Join Greg Hunter as he goes One-on-One with Charles Hugh Smith, author of the new book \u201cMoney and Work Unchained\u201d<\/strong> and the founder of the popular site OfTwoMinds.com.<\/a><\/p>\n