Q: Mark Farber recently observed that the USA economy based on savings, capital investment and production did well from about 1820 to 1971 and, based on money printing, from 1971 to today, has not done well. Your comments?
A: Mark Farber is a real economist and competent wealth manager. He is not a political propagandist seeking to benefit from serving central authority. He is an independent observer and thinker. His observation is spot on. August 15, 1971 is when, by executive order, Nixon closed the gold window at the NYC Federal Reserve Bank office and defaulted on the obligation to redeem USD for gold at $35 per ounce. Since then the money supply has shot straight up and the average family has not benefited economically form the last forty-four years of advances in science and technology. All of the wealth increase from 1971, after inflation and taxes; and, adjusted for married women more than tripling their participation in the workforce has been taken by a parasitic political class and their adjuncts.
Q: Sounds grim. When will things get better?
A: I am optimistic. Socialism, John Maynard Keynes style, will collapse just as communism did. It is inevitable. There are many hopeful signs. Separatist movements are proliferating. Confidence in government is collapsing. There is no possibility that Western governments will honestly pay their debts or fulfill promises made to pensioners. As defaults mount, demands for change will result in more economic freedom. We are on the cusp of a new Renaissance.
Nathan Wheeler predicted everything that has happened economically and politically in his book on weather cycles published in 1948. The collapse of the USSR was, according to Wheeler, inevitable because an information economy cannot function without freedom of information. Wheeler predicted the reintroduction of gold to the international settlement system by no later than 2015. The central bank for central banks, the Bank for International Settlement, has been promoting gold as a bank reserve for many years now and only lends to central banks based on the security of gold. It has already happened. The computer chip and the Internet are at least as great an advance as the Guttenberg Press was during the last Renaissance. I am optimistic.
Market Commentary (above) by Arthur Fixed
[box type=”info” style=”rounded” border=”full”]Commentary from Arthur Fixed the author of the Art of Speculation during Civil War – Sun Tzu Meets Jesse Livermore is a private manuscript copyrighted 2012 by Art Fixed.[/box]
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