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The government bond is defined as the "risk free asset" by modern portfolio theory and by regulation. No theory and no law can make it so. But in the meantime, the savings of the people is going into the government bond.
In this video, I talk about counterfeit credit, savings, risk, and what happened in Cyprus.
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i am reminded of the invention of the printing press, print wealth, now they can digitize wealth, maybe they will develop a 3D PM's machine, copier wealth.
Enjoyed it, quite good.
Just a tick there Keith...
In what way is loaning silver at interst an 'enormous improvement' over keeping silver under the mattress?
Yes you have increased the ultimate supply of silver for the non-productive years BUT at the expense of taking on risk!
As long as silver is maintaining purchasing power then I would argue that the risk is unnecessary and undesirable. The problem arises when the medium being stored looses purchasing power over time such as occurs with our fiat currencies. If we save in a stable vehicle (one that preserves purchasing power) there is no need for earning interest.
Understanding this point is essential to understanding the plight of savers in our fiat world.
Well, yes, Treasury bonds are unpayable debt, but so is the national debt, student debt, and bank balance sheets.
However, the last thing they will allow to fail is Treasury debt, as once that happens it's default and every other "investment" be it equities, corporate bonds, municipal bonds, what have you - will have been wiped out first.
Certainly, Gold does not default. If I were a retiree I would have some money in Precious Metals, but large chunks also in Treasuries, because in a world where deposits are confiscated, the last thing to be stolen and taken to Zero will be Treasuries.
The best thing about saving in PM's is not having a bunch of coked up banksters as your counterparty. Feed them their own paper with prejudice.
Money printing - Death by 1000 cuts
Like having your skin removed one square inch at a time.
And as I've said in other comments, the most unsung consequence of the Fed's policies is that the 30 year T-Bond is now effectively a risk asset.
This video is really very good. I like the guy's delivery style - very well reasoned and sensible. Also quoting Poe gets him a thumbs up.
re: "how they did it in the old times" - in really old times, actually most just had enough children to support them
having said that, gold "hoarding" is saving, I agree
LOL - "inflation is counterfeit credit" - come on, it's just a form of taxation
I still wonder why in the US there is this "irredemable" meme going around, this thinking always implies that debt can't be defaulted
Homesteading. Family gardens. Pensions. Yes pensions were given as early as 1940s in Canada. The govt of the people who pay taxes does not let their senior citizens sink into destitution. They have safety nets.
Govt today? The middle class is been reamed to provide equity to pump into arising/emerging cheap labor in developing nations. it is a transfer of wealth and nothing less.
The ongoing wars which are depleting the ability for the US govt to function SHOULD BE ADDRESSED BY SOMEONE because what good is a winning army when your country is bankrupt to hostile nations and a bank that is known to steal from its customers.
had enough children yes, then those children had to have enough children, and so on until it all goes exponential. Same problem as all of our other ponzi schemes...
it actually didn't need to be exponential so long as those who died of disease, accident or infant mortality were balanced by those who grew up of good strength, not all too close together in age, who replaced each generation evenly. Mostly the exponential excess of children has led to the exponential expansion of humans. It didn't need to be that way.
Or you could have one giant baby...like Jamie Dimon...and hope he can cover you in your old age.
War will resolve all of these problems.....temporarily.