Thursday, June 21, 2012

Minimum government and maximum freedom

100 yrs ago, US became the richest and most powerful nation history has ever known. They achieved it based on: Minimum government and maximum freedom. People flocked there and lived the "American Dream", because it is the land of free people. They can produce and save and retire.

Before the creation of the Federal Reserve central bank, there were no Federal government taxes, no department of education, no department of energy, no healthcare involvement, no medicare, medicaid, social security, and of course, people were able to produce and save, because they were on a gold standard and their savings grow in value over time. They had 200 yrs of sustained fall in prices of goods and services.

Today US is the opposite.
Money-printing by the Fed (this is not capitalism!) enables the government to grow so huge and be involved in so many things - education, healthcare, wars, bailouts, banking, food, etc
Money-printing causes inflation, and hard-working people's savings lose value.
Money-printing drives interest rates down, and no one is able to save. So they borrow and borrow and consume and consume. Everyone becomes a speculator and buy stocks/forex in order to get more money.

Now they're deeply indebted, and a crisis is coming very soon, maybe towards the end of this year, or next year. The timing, I can't be sure. But it'll be a currency/debt crisis. The end-result is a 100% certainty. It's just a matter of time.


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