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The ‘How’ of a Collapse Is Not Our Only Concern
Our recent discussion of whether deflation or hyperinflation will lay waste to the economy elicited hundreds of responses. Two of particular interest are featured below. The first, from blogger Charles Hugh Smith, explains why it may be impossible to know with any certainty which of the two forces will prevail. The second, the thoughts of a Wyoming rancher, suggests that in a crisis, we may discover that our need for protein trumps concerns over gold, silver, Treasury paper and the dollar. Here’s Charles, in an excerpt from an e-mail I received from him several days ago:
I certainly wouldn’t want to debate anyone because my arguments are those of a trader, basically, not an economist. Maybe we will get hyperinflation, I don’t claim to know. What bothers me is the widespread conviction that hyperinflation is “guaranteed.” This smells like a one-sided trade to me, even if it more of a meme than a trade.
As we’ve both said, the other issue is, how do the Elites benefit from hyperinflation? The only answer I’ve ever received is “they’ve already bought gold.” Yeah, right. As I noted, there’s $7T in gold, total, half of which is owned by central banks, and there’s $160T in financial wealth to protect in the world. Even if gold went to $10K/oz there would be no more than $35 T in gold in private hands, and by that time, the gold in Fort Knox (or in the PBoChina vaults, etc.) would be enough to establish a gold-backed currency. Meanwhile, the Financial Elites would have lost all their financial wealth. Have they really transferred all their wealth out of all financial instruments and totally into gold and land? If so, then owns the $160T in financial wealth?
This explanation — that the wealthy have already transferred their financial assets into gold and land and thus they don’t care if all money, bonds, mortgages, derivatives, insurance policies, etc. all go to zero and is wiped off the books as an asset—makes no sense because it doesn’t explain who is the bag holder to all this “fiat-based” wealth. If the wealthy don’t own all these financial assets, who does? Who did they sell it all to? Yet we know that the Financial Elites own all this financial wealth and thus it will not be in their self-interest to see it wiped out. Only debtors, i.e. Central States, want to see hyperinflation to wipe out their debt. But who considers all that sovereign debt an interest-paying asset? The Financial Elites, that’s who, along with politically powerful union pension funds, banks, etc.
Everyone seems to forget that debt is an asset to the guy on the other side of the trade. The debtor would love hyperinflation but the owner of the debt will resist hyperinflation with every fiber of his being — and that includes the Financial Elite who own the debt.
Only Political Choices
This is basically a “politics of experience” analysis, and very few are equipped to understand such an analysis, as it’s outside their econometric comfort zone. They prefer a deterministic financial analysis that there are “laws” of economics which lead to hyperinflation, etc. Meanwhile, for me, there are only political choices, a narrow band of which lead to hyperinflation and a bunch of others which do not. This kind of analysis doesn’t lend itself to refutation or confirmation by financial models of the sort being bandied about — it’s a behavioral analysis and a political one.
I have yet to see how banks and the Financial Elites would benefit from hyperinflation. Without getting too fancy, it’s obvious that holders of debt, those collecting interest on debt assets, would be wiped out by hyperinflation. Thus as a simple matter of self-interest, we can deduce they will not favor policies that lead to hyperinflation. If the owners of debt (Treasuries, mortgages, corporate debt, commercial paper, etc.) were politically powerless, then we could expect them to be steamrolled by those who would benefit from hyperinflation. But they are not politically powerless — it’s the debtors who are powerless, except for the Central State, and it’s beholden to the Financial Elites who have captured the political and regulatory classes that govern the State.
How Many Angels?
Maybe we will experience hyperinflation after all. I am a skeptic, not a true believer, but I am certainly open to it as a possibility. I think all the financial arguments are somewhat akin to biblical debates about how many angels can dance on the head of a pin. They are fundamentally deterministic and apolitical, while the actual process of setting policies that lead to hyperinflation is entirely political.
I have no econometric arguments against hyperinflation, I only have political ones. But since politics sets policy, then hyperinflation is necessarily a political choice. So a political analysis will trump an econometric one in my view.
But I could be wrong. As a basically poor person, I don’t have much of a stake in either outcome.
***
When Gold Wasn’t Valuable
And here, with the final word, is the rancher, who posted under the pseudonym Bed Rock:
The place I looked to see how to be prepared for a dollar collapse was in the journals of the pioneers who settled the frontiers in North America two to three hundred years ago. When moving to an unexplored region inside the frontier, and being months of hard travel away from any civilization where the necessities of life could be purchased, is basically where we all will be when commerce stops because of a dollar collapse.
Bartering works good, but money was not very valuable, even gold. The people needed a place to live that offered protection from the weather, water and food. Everything else was and is a luxury. The people who had the talents of building shelters and producing food prospered and those that came with family money either died or went home broke.
So what I took from this is, be prepared to use your hands. Surround yourself with good, honest people who have talents in the many life-saving areas needed to survive any circumstances that may be thrown at us. Raising chickens, making bread, treating sickness, making a garden, a carpenter, etc. You will know what you need for your area.
I am a rancher and produce enough beef to feed approximately 6,000 people. But having to do that without cheap fuel, fertilizer, and life-saving drugs for the cattle, I will produce much less. But protein is one of the necessities needed to survive and something the pioneers treasured. If you succeed and prosper as our great country makes its comeback, you will have moved up the ladder of social and economic ranking. Survival of the fittest, and we will be rid of all those who live off of government aid. So don’t be caught with just a lot of gold and silver when the collapse comes. Sell some and buy the tools you will need to survive so you can use the metals latter when civilization returns.
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This author seems to never had heard of the 49ers or gold rush, where men left everything and ran for del oro in them hills.
Why is the assumption that the elites will be wiped out by hyperinflation?
Lets drag out the thread bare cliche once again, Weimar. High quality equities tended to float with the tide. Holders of foreign currencies or with access to outside credit lived like kings and bought assets on the cheap. Most of the big trusts did well and came through with less competitors. The hereditary landbarons came through. In the end those who held WW1 bonds got paid off. Those who sold at the right time got their money back. Those who waited too long got stiffed.
Today, there is a quadrillion in hedged swaps out there. Who says that the elites are going to get burned no matter which way the market goes? That's what the hedges are for. Oh, you can't cover? Well, give us what you have. So they take some loses here and there. Just like taxpayers got the honor of covering the toxic MBS, what makes you think that part of what ever new monetary system that comes out isn't going to make good on our elite friends holdings? Especially since they'll be the ones creating it? Sure, there might be a bonfire of the vanities as the elites get to see who really is on the inside and TBTF, and who ends up in the gutter. Mortimer, we've got a stake!!
This is like arguing over whether the universe is going to expand forever, or going to collapse back to a singularity. Either way, normal people are all going to get screwed.
All I know is I ain't inviting Timmy, Ben and Barrack to partake of my free range chickens and eggs, honey from hives, deer from the front yard (eating the dadgummed pittosporum), or fish from the salt water creek behind the house. Let them eat dollar bills. I have a nephew working for Goldman and I haven't figured out where he stands in the "do we let him come in the gate or not" pecking order. Right now he's out in in coldsville.
You are blessed. You have a device for turning pittosporum into food.
It's surprizing CharlesHughSmith has such a blindspot regarding who benefits if the USD is renounced. It's evident the IMF is waiting in the wings to be the sucessor to the FED/USD. Likey it's controlled by the same forces, however to the panicked and desperate masses of a currency collaspe it will be palpable ... especially when it's crammed down their throats.
Imagine something like TARP on a worldwide scale.
1) USD collapse starts an international chain reaction
2) BigWigs meet and declare SDR the dollar sucessor
3) Western Banks sell SDR bonds & assorted paper in this lucrative new greenfield environment
4) Any USD losses by the elite are quickly recouped as their Big Banks revel ... with the added bonus that the (PowersThatBe controlled) IMF now has worldwide scope & power surpassing its Fed predecessor.
Never let a crisis go to waste
You left out "new regulations for the purchase or sale of gold." Otherwise you nailed it.
Dave Harrison
www.tradewithdave.com
interesting
Rick Acherman
Your previous article said you were up tramping about at night thinking about deflation which suggests you're new to the 0.000001% 'Rarer than Hens Teeth' Deflationists Club. This article now suggests you don't understand deflation and its impact on prices (or protein!).
In deflation ALL prices drop because the value of money (cash) increases. Protein like farms and agriculture will have prices crushed. Protein will be cheap, not expensive, as farmers and retailers will be after hard cash (while fluffy credit/debt implodes in froth all around)
the elite prob dont want the system to collapse, but then all fiat paper collapses. just cuz ours hasnt yet only means we aint waited long enough.
sure they can keep devalueing. as long as the suckers keep accepting it as payment, they'll keep printing it.
You put wayyy too much thought into this.
Print money = inflation
Print a lot of money = hyperinflation
Print a lot of money and make sure wages aren't inflated along with everything else = stagflation + hyperinflationary depression followed b severe deflation.
Tekhneek
I agree, let's keep it simple;
$650 Billion in cash (Fed printed notes)
$70 Trillion in credit/debt ($700 Tn if you include derivatives)
When the $70 Trillion of credit starts collapsing and imploding under its own dead weight of un-serviceable debt nobody is going to notice the tiny little $650bn in cash. In fact because people will be fleeing credit (which is IOU's and risk being worthless) they will be fleeing to the hard stuff, cash.
To put it simply, 'Cash will be King'
Yes, very good analysis. The more I read of Rick Ackerman, the more I like Jim Willie, quoting him:
A bigger fool than the Deflation Knuckleheads is the USFed Chairman Bernanke. He is a myopic professor who wrote a fine piece of revisionist history of the Great Depression, who now presides over a global monetary systemic collapse. Gold is reacting, but Silver reacts even more. As long as the insolvent big US banks remain in operation and are not liquidated, as long as toxic paper repositories rest under the USGovt roof, as long as the USGovt deficits remain well above $1 trillion annually, as long as Quantitative Easing legitimizes the debt monetization without checks, the GOLD PRICE WILL RISE INDEFINITELY. It is that simple.
++
The discussion of protein vs. gold is the same as what has intrinsic value and what does not. It's not whether they'll be deflation or inflation, it's how bad will the outcome of either be. Water & the ability to make food (unless you want to take up the practice of sun gazing), especially self-sustainable food, are intrinsic. They are essential for survival. Gold does not have intrinsic value. It does not have value in a Mad Max world, but it's highly unlikely we realize that type of collapse. Countries throughout Central America have experienced currency collapse. It didn't end their worlds. Life was difficult for 3 - 6 months (everyone should have enough protein on hand for that duration), then civilization rebooted. Betting on Mad Max is not a good bet, especially with all of the wealth we have between our borders.
Now we get to deflation or inflation. The balance sheet at the end of the day looks the same. You don't create or destroy net cumulative weath through finance, you just pick the winners and losers. Will the winners be the savers or the debtors? In hyperinflation, currency denominated debts are worthless but assets remain. In deflationary spirals, currency denominated debts are valuable, but the underlying assets are so devalued the debtors assume control.
Banks are in a really tough spot here, right? They own all this debt, but they also have a ton of depositors. In a deflationary spiral, they could engineer a permanent bank holiday (so depositors cannot take out any money) but enforce all of the rules on debt, they would have it made. That would involving telling Granny she cannot withdraw her $10,000 FDIC insured CD while the banking industry is foreclosing on America. With 99% certainly, the Fed would step in and print Granny her $10,000. That's a helicopter Ben outcome.
It's hard to imagine how a material haircut of our debt to where it would need to be that would not cause a deflationary spiral (causing the steps above) or a run on the dollar (which may happen anyway). Hyperinflation would deem the debts of federal government & every state to foreigners worthless, which is a pretty substantial wealth transfer.
Provided order is restored and property rights are not confiscated, those who purchase the most real assets with the most leverage are the biggest winners. I'm sure you'll find that those covering their risks have intrinsic, gold & highly leveraged real assets covered.
intrinsic value is also determined by how well value can be stored, at least in the context of civilization.
take away the storage of aspect of intrinsic value, and you've eliminated one of the primary bases of civilization, which is division of labor.
when civilizations reboot, its always to take advantage of the mutual benefits of trade, and must a priori proceed beyond mere survival.
there have been plenty of episodes in history when civilization didn't reboot, because there was no cushion beyond survival necessities to allow the luxury of specialization and trade.
property rights are already in the shitcan, which is one of the reasons we're talking about this fail. the claims to wealth already rest mainly on force and fear, and it will go further. only a question of how far starved the world gets before their plan for the battle meets the reality of the war.
saving physical capital is only loosly correlated with the division of labor. savings form around intellect. intellect defines a method of production. labor serves that method of production to the extent it provides a better outcome for the laborer than its other alternatives (whether volunary or involuntary). some operations win, some operations lose. the winners expand. only a coercive force can stop that process or change its destined result. the coercive force turns from protecting the intellect to abusing it for political gain. the abuse of the coercive force eventually leads to disequilibrium. people recognize the disequilibrium & its cause and right the course, or it becomes dependent on the coercion. eventually, the disequilibrium turns into disintegration.
the process starts over again...
you got it backwards.
intellect is freed by savings. if you can't save, you're living hand to mouth, subsistence. knowledge and skills cannot accumulate unless the practitioners are fed, unless someone else grows extra. specialization and trade depend on a durable means of exchange using a mutually agreeable unit of value, otherwise its under the limitations of direct barter.
without a cushion of savings, there is nothing for accumulated knowledge to act upon.
the only cycles within subsistence are imposed from outside, such as by weather.
past your statement regarding coercive force, we agree.
look around you. wealth is abundant. the original wheel does not require re-inventing. debts are expunged. the story resets with collateral & tons of intellectual capital.
tell me what you really own, and if you want to work as a serf without the benfit of lawful private property.
its not wealth if you don't have the right to use; the concentration of claims to wealth is essentially involuntary rationing. we are clearly transitioning away from abundance. the debts are not being 'expunged'.
ask all those murdered by statists in the 20th century about abundance and reboots.
civilization has historically, reset or not, required some abstraction as a store of value and a unit of exchange. a functional civilization, advanced beyond barter, always eventually has an abstract, durable, divisible, limited, impossible to counterfeit, sometimes with utility (only sometimes because utility often precludes durability), and recognizable standard of intrinsic value.
so intrinsic value depends on context.
within civilization, gold has a 6000 year track record, and is usually the end of the debate between between abstract money and consumable 'money'.
QED
I'm not sure hyperinflation, or some lesser form of large scale inflation, would destroy assets. After all, we didn't see a massive destruction of wealth in the late 1970's or early 80's. If anything, inflation (which I think IS guaranteed) would at worst moderate the value of overall wealth, making commodities like gold the best viable investment to offset its effects. To that end, yes the very wealthy HAVE hedged already.
I'm a believer that a large scale inflationary spiral is about to start. It's in the best interests of the wealthy because it increases asset value. Sure, the overall effects on the economy are negative, but who cares if you're keeping up with it? It just means your portion of the overall wealth is climbing while everyone else falls. To that end, the very wealthy simply don't pay a mind.
Food is probably a good investment because regardless of what happens, there is always a market for it. More importantly, if hyperinflation hits food, then all the building will stop, farms set to be turned into communities will reemerge as plowed land, and prices will eventually moderate to a degree.
There is no end of the world scenario - only turn of the cycle scenario(s). Pick one.
ever play 'king of the hill'?
wealth is only either material with utility or labor to improve that material
if that wealth continues to concentrate, its game on, and the 'wealthy', to the extent they are visible on top of that little hill, (everyone else is aware that they are at the bottom - starving) are gonna get knocked off.
claims to either type of real wealth, present or future, must be enforced or defended.
the real problem is that the cost of defending the empire of 'wealth' (claims on real wealth) is quickly approaching parity with the value of those claims. all empires fail for this reason.
The poor man's protein is inexpensive and better for your bulging waistline. Whole grain rice and beans combine to make a balanced protein. Not only does it help keep you slim but unlike animal protein there is far more natural fiber in rice and beans so you don't have to take the over the counter shit softeners or fiber drinks (yucch!) Dried beans and dried rice don't take up much room, doesn't need refrigeration and won't spoil in one or two days if left out in the open.
The elites own things without debt. YOU owe them. YOU are the bag holder of all the debt. Notice the bankers got bailouts and bonus and mainstreet got the tab and tough love. Heads I win tails you lose.
Hey, BANJO. Do you pick the 5 string? I've been playing for 46 years.
As They Attempt To Strangle Us, Here Are Some Facts Worth Viewing
Corporate Tax Rates, Then and Now By Barry Ritholtz - April 14th, 2011, 7:15AMGE paid no taxes; Goldman Sachs paid $14 million last year. The GAO reported in 2008 that “two out of every three United States corporations paid no federal income taxes from 1998 through 2005.”
Companies have become all too astute at paying for loopholes which allow them to shift profits abroad, or move their gains (on paper) to foreign low-tax/no-tax nations.
Since tomorrow is April 15th, it is a good time to look at the overall tax payments corporations have made. As the graphic below shows, the change in corporate taxes — not merely rates, but what they actually paid — over the past half century is astounding.
Anyone who is serious about closing the US deficit should consider the changes in what corporations pay in taxes and the rise of the deficit.
This is the incorporation process. Start a group that sets down rules. Follow the rules. Make people outside the group follow the rules. Keep them following the rules as you slowly and patiently stop.
Facts and stats that don't lie or are manipulated by the likes of American Heritage Foundation. How rare!
Prior to any tax talk, first and foremost, all corporations must take and pass the solvency test using real accounting standards. If they fail, they must FAIL. Wipe out all the parasitic corps (which is just about all of them), unleash small biz and then let's talk taxes..
This a coming crisis only the dedicated eugenicist could love. Rid the world of excess pop and, oh, get rid of the tax eating class as they have no real productive heritage. Who's left? The productive Morlocks for the elite's Eloi. All they have to do is get control of a good stock of food and land. So if we see an increase in foreclosed farms, that may be the reason. Of course if you can feed people reliably, you can field an army to take whatever else you may need. Don't the Georgia Guide Stones recommend a total world wide population of 500,000,000? Politicians are nothing if not the most dangerous assassins in history. Their war record speaks for itself.
I believe your scenario is nearly unavoidable, for many reasons. First, the multigenerational "tax eating class" is so utterly worthless that they would not even be good farm laborers. Second, productive people need leaders, preferably with resources. So the elites in your context would not be Eloi; they would be productive people with resources. I could easily visualize a feudal society with wars between nobles for land, water, etc. And those wars would very conveniently further thin the population.
The human race has only itself to blame for what is coming. We refuse to control population slowly and methodically. So it will be done the old-fashioned way. There will be no philosophical debate. In a world stripped of resources, the population bubble will have to burst.
Interesting angle, I get what you're saying. The Fed is the Fannie/Freddie to human population. They helped to create a false economy, which lead to an oversupply of humans, which has only one bad ending...a massive wave of human foreclosures to come.
''God's work", in deed.
as if the american elite are the only ones who can control whether hyperinflation will occur or not . That decision is not made by the american elite , but to a large extent by holders of dollars (petro dollars or Treasuries , China anyone ?) who could dump their paper when they finally realize it's just ass wipe . Political decision ? Sure , but it is very provincial and typically american to relate all things politics to US politics . Try geopolitics for a change
For starters...
Wealthy can move their money to other currencies and hedge against inflation. Hyperinflation may not be in the cards, but inflation big enough to cripple the USD seems to be desired. Such a defacto default will give way to a new WRC to be rolled out by the IMF to start the fiat game over again at a new level. This just seems to be the real goal.
The wealthy positioned ahead of time will take advantage this paradigm shift as an investment of a lifetime. TPTB are not even hiding these schemes anymore. Soros just had a monetary meeting on this subject for super rich dicktator wannabees last week. The BRICs + South Africa are meeting this week to counter the Western fiat WRC proposals. Game on.
The great escape for the wealthy is a favorable exchange rate into any new WRC. Those holding the right currencies and assets, ie., not the USD apparently, will be wealthy in the new currency. It's just another investment to be played. TPTB know what the outcome will be so they will be positioned not to be wiped out.
I'm guessing that would be a good time for China to put all it's cards on the table and revalue it's currency so they could grab a bigger share of the SDR basket, and more economic power, if the IMF SDR is the new WRC.
For government, a deflationary spiral is too hard to tax at the local, state, and federal levels, whereas, inflation is a tax and allows them to keep some control. The Fed is willfully fending off deflation because the governments and banks can confiscate more money through inflation until the end of the USD. Deflation would shrink bank assets 10:1 in reverse fractional banking causing a crises for them to maintain their reserves. Derivatives are levered on top of that. I suppose there would have to be massive bank loans called. I assume pensions and wealthy people own all of the above, so inflation is the lesser of two evils.
The Big Ponzi requires inflation of currency even as real value is destroyed.
Great comment, was wondering how you would position yourself for any of your potential coutcomes? Buying Chinese currency before they make it more attractive prior to a major realignment etc.. ..What about buying land, much less liquid but at least its not digits in the bank and the hyperinflation has not taken off yet making todays dollar strong compared to what could happen. Again, great comment.
When I was a kid one of the first movies I grasped was "On the Beach" We may think we have it figured out-the future but more than likely it will be a black swan event of some kind. We can try to be prepared but to think you have every option covered is only foolish. I like the way ZH puts different things out to consider.
http://finance.yahoo.com/blogs/daily-ticker/good-king-ceo-pay-big-2010-not-much-20110411-085325-820.html
It might be possible that chair filling CEO's will loose value and goat ropers will gain value.
Ha ha. I've got to laugh when a cattle rancher sees a bright future when "we will be rid of all those who live off of government aid." Agricultural producers are the biggest welfare queens in all the land. How much U.S.-subsided corn do his cows scarf down daily? Does he pay anything to the USDA to put their stamp of approval on his product? How much does he cough up for maintaining the roads that transport his cattle?
I am sure he would gladly drop any subsidy if he were able to wave a magic wand and remove the subsidy of others permanently.
As a Dr I benefit from govt subsidy too, but i would instantly agree to end all government insurance, transfer payments welfare , and redistribution schemes of various sorts, even though it would cut my income in half.
The ability to live in a free society with individual liberty and personal responsibility would be worth it. No more nanny state.
I'm with you.
Same profession, same sentiments. Get all this crap off my back.
Unless dude is raising grass-fed beef and selling it locally, he's using our tax money to stuff subsidy corn into animals that he treats with antibiotics and bovine-growth hormones. His whole unsustainable operation is a crotch-kick to the budget and ecosystem, not to mention human health. Oh, and the millions of methane farts from his ranch of hypocricy are causing hurricanes. He needs to dismount from his high horse of "rugged individualism" which disguises the fact that he's suckin' from the big guv'ment teet while pissing on our grandchildren's future.
Most likely the rancher operates a cow-calf operation. So, yeah they are grass-fed. The calf is sold and ends up at the feedlots so as to be near the corn-belt production areas because it is cheaper than hauling the corn to the ranch. The feedlots do the antibiotic and bovine-growth hormone treatment.
"Oh, and the millions of methane farts from his ranch of hypocricy are causing hurricanes."
Wowser.......!!!!!! What about the quadrillions of farts from big city folk? I guess they don't stink or cause hurricanes.
A lot of ranchers lease BLM land for pennies per acre, graze it until it looks like the Moon and then they move on, like locusts.
Chicken+eggs=protein... so find a hot chick who has a chicken ranch
Meat and other commodities will no doubt maintain their value, but did the average person in Argentina really start raising cattle and making medicine out of herbs? I don't think so.
This is 2011 and the US is one of the three or four most modern countries in the world. Hyperinflation and the destruction of the dollar might well happen, but it won't play out like Mad Max. The currency would be replaced with something new very quickly.
I'm not denying that we may all get screwed, and experience a few weeks of runs on the grocery store etc. But we won't turn into 300 million homesteaders. The undeniable urge of humans to make markets is stronger than one currency or another.
Correct. Most Americans require all sustenance to be readily available - all dependent upon cheap oil. Hyperinflated savings will be reduced greatly in a new currency, if not wiped out. Imports will be severely curtailed. And how exactly do supermarkets go back to normal in a few weeks? Life will go on for those that have the means to support themselves - how is the gov't going to feed 44,000,000 foodstampers with expensive oil? You remember it took six days to get helicopters to the Superdome after Katrina? Before suggesting that we can't possibly go to Mad Max if would be better to detail how the system magically holds itself together. If we're all getting screwed how will life look like anything it does now?
Excellent points all, Chet, particularly the last.
-there are only 3 currencies;
1) Oil
2) Drugs
3) ________________
First the hyperinflation. If you believe that conscious decisions are made that cause inflation, you haven't met my congressman. Politicians have always fallen over each other in promising more than the other guy - - that is what gets your vote. They have given away so much future money, that only inflation can handle the checks that must be sent out.
Now the protein. Unless the rancher has some method of giving you ownership of a pound of beef, or a half of beef, he won't be able to get rid of his beef. Even barter doesn't work well in this situation. For example, how do I trade my truck for his cow? One truck for two cows? The answer was figured out thousands of years ago, gold and silver.
Try reading my article on Gold Eagle, "Abandon Ship, Abandon Ship".
Wow, 2 things. All this argument (the first part of the post) was about how hyperinflation doesn't benefit the "elites" so hyperinflation will not happen based on the assumption that the elites are infallible in their control of everything. I really doubt it. In fact, I don't like falling into the "elites" as "them" categories or plain simplification. Because what you call elites I call you, see:
"Survival of the fittest, and we will be rid of all those who live off of government aid."
Yeah, those evil welfare queens, righto? That's a very "elitist" thing to say, social darwinistic too.
What Rick and Charles don't understand is that basically the financial elites are scorpions. And to refresh your memory here is the tale of the scorpion and the frog:
"The story is about a scorpion asking a frog to carry him across a river. The frog is afraid of being stung, but the scorpion reassures him that if it stung, the frog would sink and the scorpion would drown as well. The frog then agrees; nevertheless, in mid-river, the scorpion stings him, dooming them both.
When asked why, the scorpion explains, "I'm a scorpion; it's my nature.""