Dec 28, 2016

Some Problems Have Grown Beyond Remedy

Most of the political leaders in the world have spent their nations into a corner between a rock and a hard place... Default or Inflate.

Common Sense Commentary: There are some problems, created by idiots, so insurmountable that no amount of Common Sense, or the best of people, can make it right. God can solve any problem, but He doesn't do it for greedy idiots. Greedy idiots have to suffer the consequences of their actions. The shame is, the innocent also suffer from the errors of the wicked. That is America today....

As of now, the end of 2016, our U.S. Federal debt, in outstanding Treasury instruments, reflecting actual money borrowed from other governments, banks and individuals, is 19 Trillion dollars. That is 19 thousand thousand million or 19,000,000,000,000 dollars.... a stack of dollars bills from here to the moon or 10 times around the earth. And that doesn't count the approximately 100 to 200 Trillion dollars in unfunded liabilities like Social Security, Medicare, Medicaid, welfare etc. etc. Social Security is "unfunded" because the S.S. fund has been spent and replaced with an IOU note.

Since the elections, the interest rate on debt has increased 0.8%, (less than 1%). But just that little bit amounts to an extra interest expense of $160 thousand million in the theoretical case that our US government refinances just that "extra" on a 10 year term. So, who is going to pay that extra fractional increase on debt? We can't even pay the debt that was already strangling us. Since other nations don't want any more of our mammoth, accumulating debt, and knowing our politicians and the Federal Reserve, they will probably just keep printing digital money, to loan U.S. banks at no interest, so they can keep on buying all that additional debt till hell freezes over. Then, as they all skate across this hellish, thin ice, the banks, having earned a huge arbitrage of percentage loaning out those trillions they borrowed at no interest, will just give those digital treasury notes back to Uncle Sam and thus pay us Tax Payers what they borrowed.  Every 1% raise in the interest rate equals 200 Billion in added interest per year on Federal debt ... forever. The big rotten spot in that apple is, every new dollar the Fed counterfeits makes your dollar worth less. They like to call it "inflation" and claim it doesn't exist, but every time you buy something, you know it does exist. And besides losing your money's buying power, you and I are still responsible to pay off the debt, Uncle Sam has borrowed, in future taxation. Oh, well, I'll be dead by then and beyond the IRS Tax Collector's reach ... There are no taxes in Heaven, thank God, so you younger citizens will have to deal with it, and may God have mercy on your poor souls. My generation, a greedy, sorry majority, did it to you. I apologize to you for not fighting it harder.... but I drew the line on  killing all the  Democrat and half of the Republican politicians.

I am afraid I must tell you that neither Trump nor anyone else, except God, can solve our national debt quagmire. He can default on it or inflate our money and pay off debt with counterfeit green paper that will be worth about one cent per dollar. There is just one thing Trump can do to live up to his promise to "Make America Great Again". That one thing is to restore the gold standard jerked out from under our U.S. money August 15, 1971. Since that date, our money has neither silver, gold nor any other commodity of value backing it up. All it has is our government's word that it is worth something. It is, since 1971 nothing but fiat green paper. It was made Fiat, by the decree of an official  authority, Richard Nixon. It seemed to make sense at the time because with the U.S. dollar as the World Reserve Currency, tradable for U.S. reserve gold, and other nations had begun trading dollars for our gold and rapidly draining our National Gold Reserves, we were taken off the Gold Standard. That released Congress the restraint of each dollar having to be worth a set amount of gold. Trump could restore the Gold Standard and make each federal ounce of U.S. gold in Fort Knox and New York worth the proportional number of currency dollars and digital dollars in existence worldwide.

If the U.S. has the 8000 tons of gold in reserve storage vaults, the Fed claims, that would make each ounce worth many times what it costs today, and enough to pay our National Federal debt. Since our reserve gold hasn't been audited since President Eisenhower did it last, only the elite insiders of government know if it is still even there. 

China, Russia and India, in that order, are now buying all of the gold being produced, worldwide, at a price below the cost of production. Now why do you suppose that it. 

A few people have asked me where I get my information. I read a lot and try to confirm the facts supporting my conclusions by googling it. I put little confidence in the Left-wind fact checkers, but I nearly always find the truth of the subjects of my blogs. RB

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