Remember Ron Paul? He’s had some interesting interviews lately, providing valuable insights on the inner workings of Washington and recent bailouts.
Fox News 2/20/2009 with Judge Napolitano
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The ideological arguments regurgitated by television talking heads, regarding how governments should intervene to resolve our current economic crisis, focus on whether bailouts should be directed at the rich or the poor… a difference without a distinction, in my opinion. Regardless of how money is injected it will always end up in the same place. Money flows in streams like water and it always trickles up because the rich own everything. When money is given to the poor, they will likely just save it in the bank, pay down debt or purchase consumer products — in other words, immediately rush to line the pocket of their neighborhood rich guy.
Let me try again to explain, more clearly, why government interference may fail. There are people who believe we have entered a new long wave cycle of increased savings and decreased consumption that may last a generation. If people are determined to save, the government can not force them to borrow. If we are entering a new savings paradigm to balance the previous few decades of excessive debt, which the evidence currently supports, government interference, both monetary and fiscal, will not only fail but significantly intensify the crisis.
This presentation is from Nov 2008.
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In most developed countries when people go bankrupt they become dependent on a government “social safety net” and drain the nation’s resources with unproductive expenditures. Keeping people fed is important, but it’s not going to help stimulate an economy out of recession. People aren’t likely to increase consumption with diminished income from employment insurance or the credit cards they don’t have. They aren’t likely to become more productive in a job they lost. Social stabilizer, yes. Economic recovery plan, no.
This guy claimed back when oil was near its peak that he was given inside knowledge of a coming oil collapse, the purpose of which would be to bankrupt OPEC countries and consolidate control over America. I remember reading his article at the time, and ignoring it, thinking he was nuts. I forgot about it until I came across this interview with Alex Jones.
How can a currency be in short supply and hyperinflationary at the same time?
Economics 101 tells us that reducing supply should increase price, but that doesn’t seem to apply in this case. Perhaps it’s because most banking happens electronically, or perhaps it’s because hyperinflation is as much psychological as monetary. They have lost confidence in the Zimbabwe dollar and there is nothing the government can do about it. Once the process gets going, even if you take away the punch bowl nobody cares.
I seem to remember Bernanke making the case US dollars will not lose their reserve currency status because there is a shortage around the world.