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If We're Going To Borrow Against The Future, Let's Borrow To Invest
Submitted by Chris Martenson via Peak Prosperity,
We are at an important juncture as a global society: either we immediately prioritize a new trajectory focused on creating a positive, functional future or -- by continuing the consumptive, extractive, exploitative status quo -- we will default into a nasty nightmare.
What will determine which future path we take is our collective narrative. It's the story we tell ourselves -- who we are, what we value.
The Power Of Narrative
Under the old narrative, the one currently operating and taking us towards disaster, powerful people and interests simply perpetuate a regime of More of the same.
And I do mean ‘More.’ The old narrative rests upon an ideology of endless growth. It wants and requires more of everything. More cars sold, more houses built, more jobs created, and more goods and services of every description sold next year than last.
Everything flows from that want for more. The defenders of the old ideology are therefore defenders of our astonishingly-wide wealth gap, rapid energy depletion, emptying aquifers, disappearing pollinators, ruined soils, and dying oceans.
It doesn’t have to be this way.
A subtext of the old narrative is that humans are destroyers: we wreck natural systems. Put humans somewhere and first the large animals go extinct. Then the waters become polluted. Next, the soils are stripped.
Less well known, possibly because it shines a bitter light on our common practices, is that humans can be incredible forces of positive change, using their big brains to build natural abundance at rates far faster than nature by itself is able.
Using sustainable agricultural practices, humans can build topsoil at 100x the rate of nature alone. We can speed up the maturation of forests. Or cleverly plant the right species of vegetation to complement the specific ecosystem needs of our unique local areas to reduce (and reverse even!) the impact and occurrence of desertification.
All it takes to determine which role we play as a species -- the pillager or the steward -- is the choice we make as a society.
Changing our role is as simple as changing our narrative. And as hard.
So Let’s Do This Right
Imagine for a moment that instead of a trillion dollars being printed and handed to the big banks, that same trillion dollars was spread across a range of investments in our collective futures.
This idea crystalized for me during a recent interview with Richard Duncan wherein he noted that we have have a once-in-a-lifetime (maybe once ever) opportunity to borrow a lot of money at the national level, even to print up enormous amounts of money, without creating meaningful inflation.
A very rare combination of factors allow this to occur at this moment in history, including excess global manufacturing capacity, global labor markets and increased automation (which prevent wage inflation from taking root), and very low inflation coupled to the lowest borrowing costs in history.
Put all of that together and the OECD countries (US, Japan and Europe, mainly) have a very rare opportunity to borrow, and borrow a LOT, on extremely favorable terms.
In our conversation, he asked, Why wouldn’t we do this, and then spend that money on our highest-potential opportunities? Not consumption, mind you, like transfer payments and wars and other non-value-creating behaviors, but investments.
Bailed-Out Banks, Or Better Batteries?
For example, we desperately need electricity storage technology to improve. If we’re going to ever transition to renewable, non-fossil energy sources like wind and solar, then we absolutely have to have improved battery storage.
So let’s dedicate $100 billion of that trillion to improving battery technology. Set massive monetary prizes for whomever solves the power density riddle using common materials. Fund research laboratories lavishly. Use PR to elevate and revere the scientists and engineers who make promising breakthroughs, in order to lure our best and brightest minds into this important field.
Spend another $300 billion installing solar thermal panels on every roof top where it makes sense. Retrofit old buildings and requires new ones to install them as part of the process. Whether existing hot water heaters use electricity (coal, gas) or oil and gas directly, fossil fuels are being burned to heat water, which is just plain stupid. The sun can heat water for our needs just fine, for free (after a small investment).
Then spend $500 billion upgrading our electricity grid to get it ready for the next hundred years. Make it smart and distributed, and therefore less vulnerable to natural or intentional acts of sabotage. Get it ready to accept and use the diverse sources that alternative energy will require, so we can let competitive innovation flourish. Use technology paired with incentive alignments to drive more efficient use of electricity by consumers. Cars with improved batteries will both draw from and put back into the local grids: when the sun shines and the wind blows, electricity will be flowing into the grid; on calm days and dark nights power will be drawn from all our collective storage devices.
Take the last $100 billion from our trillion and put it into permaculture and cutting-edge sustainable farming practices that demonstrably improve our soils and support diverse life while removing the needs for fossil inputs in food production. Models like Farmland LP prove that such farming practices not only work economically, but ecologically. Everybody wins, humans included. Fund regenerative farming programs, give awards, and let the bright young people working in these fields know that society supports and admires their success and mistakes alike.
The Choice
So that's an alternative way to spend $1 trillion, instead of giving it to the banks as central banks around the world have been doing hand over fist. For perspective, since the 2008 crisis, the world's major central banks have injected over $8 trillion into the financial system by expanding their balance sheets. Given the moribund global economy that's resulted, along with the massive wealth gap and increased systemic instability, perhaps we'd indeed have much more to show for their efforts had a mere $1 trillion been invested in the way just proposed.
The point is, if we're going to use this historic "hall pass" to borrow massive amounts of money, shouldn't we invest that money towards creating a future worth inheriting?
(Yes, there are very good arguments to be made we perhaps shouldn't be feeding the debt glut that's at the root of our global economic problems. But the borrowing and money printing is indeed happening. So as long as it is, shouldn't we be doing wiser things with it than simply enriching the top 1% at the expense of everyone else?)
When the next trillion is borrowed into existence, let's do inspiring and wonderful things with it. Spend money to buy out fishermen so that collapsing ocean fish stocks can recover. Invest in water conservation and recovery projects where needed. Rebuild our crumbling bridges and deliver the highest speed internet, for free, to every corner of the country.
To do all of this, all we need to do is decide that these are our priorities instead of the sorts of things we currently spend our money on.
The alternative, sadly, is simply more of the same. That path is leading us straight into a nested set of predicaments that will all come crashing down on our collective heads at some point in the future.
So that’s the change in narrative. If we're going to borrow, let's borrow to invest in ourselves and in our future. Any country that does this will quickly become a shining example that other countries will want to follow, and from whom they will buy the next round of cutting-edge technologies that will actually improve people’s lives and rehabilitate their hopes. And give us the infrastructure we'll need to navigate the twin colliding trends of resource depletion and population growth.
Sadly, the people and institutions in power do not cling to the status quo likely. Do I expect them to support a radical shift in narrative that leads to very different behavior than we see today. No. No I don't.
In Part II: What Systemic Breakdown Will Look Like we’ll discuss what will happen if we don’t do things differently by looking at the probable breakdowns in the economy, energy and the environment, as well as how you should prepare for these outcomes.
Click here to read Part 2 of this report (free executive summary, enrollment required for full access)
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Let's BORROW!!! ~ Yeah, that's always good advice!
FFS!!!
Fuck tomorrow, all I care about is money and power.
Did I mention I'm running for office?
$58 trillion in credit market debt outstanding in the US.
Hasn't there been enough borrowing already?
Write-down the goddamn debt and establish a sound currency.
Look, you know the next trillion is going to 'the tribe' unless it is redirected.
Why not have it go to the people instead?
I seriously do not understand your, or anybody's, resistance to having the next allotment go towards good instead of evil.
Saying "borrowing is bad" is about as useful as saying "hunger is bad." So TF what? Who gives a shit about your lame observations?
Think big for once, instead of small.
If you were to do that, what sorts of things would occur in your brain? Which ideas? Say them.
Martenson is another communist idiot Central Planner.
He's also boring.
How about if we get on the credit side of the ledger instead of the debt side? When you are 25 years old, you can go out and get a bunch of loans to be a debt slave the rest of your life. Or, you can get on your feet financially, live frugally until you are say 40, and THEN have an even BETTER life, because you aren't paying 18% on credit cards that you didn't take out when you were 25. You save lots of money when you aren't paying the banks ANYTHING. They won't like you very much, but fuck the banksters.
Welfare, college degrees in rap music, F35s, black ops in the Middle East, and golf junkets for the President seem like real investments in the future to me.
This sums up the Fed's rigged market -
http://www.dailymail.co.uk/news/article-3023220/Wall-Street-trader-makes...
The best part about his plan is that all these improvements would happen automatically in a free market.
Centralized smart power grids? People will just buy nano grid power generation.
Free Internet initiatives? Mesh networks will pop up everywhere.
I get the fact of putting this funny money to good use, but it's all imaginary anyways and however they spend it will just screw us over anyways.
Oh, he asks you to think? What an outrage.
Greece runs out of money on April 9, Needs to borrow 7 billion Euros from Brussels to stay solvent.
No borrowing, no "growth." It isn't 1946 anymore. Since it's not,what to do? Libertarian ideas may be very useful in contraction mode.
The major problem with this is that you need a strong govt. with a clear mandate and financial vision. Barack and the 2014 Econ Advisors got the congenial idea correct that significant structural labor problems are best solved by massive 'alphabet' agency projects, like the Hoover dam but lack the torque + achievable projects which are actually possible to implement given their weak understanding of the mainstreat US Economy. Since Obama and the US is rapidly running low on liquidity and time, the best strategy would be to address:
1. The White House lacks any concept for political center and has painted itself into such a populist corner that any state project will disrupt a key DNC entitlement programs. Its the old concept of save the cheerleader or save the world. He has 12 months to fix this. A nation of 38 million engineers will do nothing, except wallow in debits if 38 million engineers are not employed in something constructive.
2. Labor markets which have acted as the largest "bumpers" for labor attachment not called bartenders/fry cooks are horribly entrenched right now.
3. US populist taxation and hiring inventives. The whole fact obama care sucked down a 43 billion dollar tax windfall from gasoline, and healthcare is still going to dissapoint this spring speaks volumes to failed policy calculations at a economic advisor / fiscal policy level of govt.
4. New markets. A very smart old brit once said that Iranians like the US. its their government who are batshit insane. As an aside, nobody has ever went to war against another country with an active McDonalds franchise. This applies double to China, and Chinese need to make a break in lockstep with Maoism, and this is where the current thought leaders need to step up. Chinese agency corruption is by far the largest risk to world growth, next to Putin's best intents to ply Chinese mandarins for his own advantage.
Instead, we borrow to pay debt held by big banks, and borrow to give handouts to non-productive beings.
I disagree. -=WE=- don't do anything. We get our money robbed from us by a kleptocratic institution that then uses it as collateral to borrow money from other kleptocrats and then they give this borrowed money to a privileged few within their ranks.
WE don't get any real choice - or else WE would keep all of our money and only spend it on things we value.
I reject the premise of this article, heh.
We, We, We... all the way home.
What "we" really need is a strong leader, who will really crack the whip.
Guess "we" should all move to the Bay Area.
I once read an 19th century philosopher who said the following:
"The species that perpetuates itself above all others will eventually die in its own waste" Made sense to me
Did he mention the small segment he belongs to do not consider themselves a "species". The lecture was intended for conditioning us after profitably driving us (people across the world, over various era's) into untenable situations of servitude, war, debt, submission... re-reading history can be interesting.
I'm pretty sure the inflation is subdued because of record corporate cash balances being held overseas to avoid tax. What is it lately, $1.7T? $2.4 Trillion?
Who's going to plan all these new initiatives? Some central planning committee? To direct all these collective works for the public good? How will we montor progress? With production targets? Ask the USSR how that worked out. Oh yeah, you can't because they crashed and burned.
I used to like Chris. But he has gone further and further off the rails. This is a new low. The approach is based on centrally planned solutions financed by debt.
Read the Fourth Turning, Chris. There is no escape from our destiny.
Some problems have no solutions. Just outcomes. You said that.
Get ready to deal with the outcomes.
Central planners plan for themselves, while everybody else pays.
Too bad for you (and me.)
Actually, Chris has read the Fourth Turning and, in fact, interviewed Neil Howe a couple weeks ago.
http://www.peakprosperity.com/podcast/92080/neil-howe-what-expect-fourth...
oh ffs its a 'holistic' model you're adamantly quoting to strip mine useless eaters
seriously, connect the dots
I now figure that for us little peeps to be half awake is to be in a stupor made ripe for following another pied piper
Whimpyburgers for everyone..
I'll gladly pay you next Tuesday for the labor and commodities I consumed today @ ZIRP.
A nation of deadbeats is born<>
With respect, but a "deadbeat" is someone that borrows your savings and then does not pay it back.
The banksters stole your savings, deposits, and future savings, price-inflation, with their counterfeit fiat-debt loans. The "deadbeats" are the banksters in their debts to you, not the guy unable to pay on the banksters' fiat-debts.
The banksters need to repay us.
Save the planet. Guillotine the banksters.
Parasites > bankers ~ lend to deadbeats @ 20-30% who default and get their things repossesed, and resold at 50% to Santander subprime reused car program. I wonder if they mix defaulted dishwashers and bedroom sets in that paper?
The point I'm trying to make is you're not getting a better deal paying lower interest. If a PRODUCT/commodity can be repossesed 3-4 times during it's lifecycle, it's TRUE value is way down the depreciation curve. :-)
" The point I'm trying to make is you're not getting a better deal paying lower interest. If a PRODUCT/commodity can be repossesed 3-4 times during it's lifecycle, it's TRUE value is way down the depreciation curve. "
I assume that this wonder PRODUCT is residential real estate.
I tend to think that businesses that happen to serially declare bankruptcy are also based upon utterly failed economic models. Commericial airlines being on example..
Additionally:
The FedRes is an Unconstitutional private cabal, and as such they, and their branches (Chase, Morgan, B of A, etc.), have no legal standing. Therefore, their so-called debts also have no legal standing, and are null and void.
Sorry Zionist Charlies.
The banksters need to repay us.
whatta lot of goobleygook.
I'm already in an agitated, surly mood Chris:
"Imagine for a moment that instead of a trillion dollars being printed and handed to the big banks, that same trillion dollars was spread across a range of investments in our collective futures.
This idea crystalized for me during a recent interview with Richard Duncan wherein he noted that we have have a once-in-a-lifetime (maybe once ever) opportunity to borrow a lot of money at the national level, even to print up enormous amounts of money, without creating meaningful inflation."
So, fuck you, you Keynesian dickwad.
Then please provide alternative ideas.
You don't like the ones presented, then resonate with the idea that no idea is the same thing as a vote for more of the same.
I too am sick to death, agitated and surly.
So WTF are we to do?
Given that we, as a society, are already investing trillions on BS, I am ready to invest instead in our future.
The alternative is more heavy drinking. That's Russian, and I am not Russian.
So, given that no decision is a vote, what's our alternative??
A journey begins with the first step.
A Revolution begins with the first "no."
When will you say "no?"
The most powerful weapon the American people have is Rejection.
The system of fraud and theft that has been built up upon the backs of the American people is dependent upon our backs. Withdraw our backs, and the whole scheme collapses. This is our greatest weapon.
Stop Paying--Put it into food, and precious metals, etc. They stole whatever "debt money" they loaned you in the first place (fraudulent-reserve banking) and soon you won't be able to pay them anyways, so Stop Paying.
Stop Playing--Stop being a tool for them to use, mock, and call "stupid." Stop Playing.
Stop Obeying--If they are in violation of the Constitution then they are not legitimate anyways, so Stop Obeying their unlawful dictates.
The Four Rs
Rejection: Stop Paying. Stop Playing. Stop Obeying.
Revolution: It is inevitable, so prepare, as they are.
Retribution: The guilty must answer for their crimes against the American people and the Constitution. No “truth and reconciliation,” but “trial and Retribution.”
Restoration: Restore the American people, country and Constitutional republic.
The banksters need to repay us.
Long breath, steady now nmewn, I'm so pissed words can't describe it. Apparently I'm not making myself clear to you or anyone else, except three.
I'm not looking or asking for any of your "collective good" to come from "negotiating" with statists like Chris or the Feds printer machine which got the government exactly where its at now, its impossible. He was right in there cheering for moar printing to finance "green energy" until it fell on its face, for jobs jobs jobs now (once again).
Just so we're clear, I want it to burn, I'm actively seeking its destruction now. I have never believed in being "ruled" by my inferiors (which is what Chris and they are). I don't believe in their law & order anymore, they have done this to us by their "laws" & disorder.
And yet you run to them, you defend them, you ask me to give you an alternative to their laws, their disorder, their graft, their corruption, their power, their "authority" to steal from our children. You want me to negotiate with thieves and the state, like some monetary junkie transfixed on the power of fiat.
Burn it.
The concept is as old as people themselves, we would rather burn it to the fucking ground than to have it stolen from our children or their childrens children of the future.
Factor that into your kumbaya alternative collective methodology of the present before you start asking for the sacrifice of the unborn generations who follow afterwards burdened by the debt you & Chris want to leave in that statist enviroment.
An economy, society, cannot borrow printed-theft, fiat, to "invest." Only real wealth can be saved and invested for the future.
To attempt to "invest" fiat is to steal production from the future and create malinvestments.
The last time this was truly tried, in the 1920s DC US, it failed catastrophically.
"At any rate, a monetary expansion results in misinvestment of capital and overconsumption. It leaves the nation as a whole poorer, not richer. These problems are dealt with in Chapter 20. 4. Continued inflation must finally end in the crack-up boom, the complete breakdown of the currency system. 5. Deflationary policy is costly for the treasury and unpopular with the masses. But inflationary policy is a boon for the treasury and very popular with the ignorant. Practically, the danger of deflation is but slight and the danger of inflation tremendous." -- Mises, Human Action
The only folks that "win" are the Zionist banksters who are printing the theft, fiat, that poisons the economy, and society. More and more of an economy's wealth and production flow toward them, and ultimately they seize the underlying collateral as well.
The banksters need to repay us.
Don't jump Mr. Bankster. My guillotine is waiting.
"We are at an important juncture"
We are well beyond all important junctures and our fate is sealed"
fixed.
Playing the IDIOT card. WTF are we going to invest in? Everyting of tangible value is levered to the hilt!
Ohh, you want us to invest in derivatives, that are already vested in other pieces of subprime piecemeal trash?
Okay sign here_____ Witnessed by, Jamie Dimon
WTF are we going to invest in? Everyting of tangible value is levered to the hilt!
Precious metals, bang metals, and food and water.
Family, friends, and community.
And, when the time comes, the Restoration of the American country.
The banksters need to repay us.
How about borrow to buy hard gold and silver. When banks collapse you may not have to pay it back, and if you do you will only have to sell 1/10000 of it to satisfy the loan
Let's borrow some bulldozers and wrecking balls first. Put 'folks' to work in bulldoze-ready jobs.
No lack of work in Top 25 Markets that need rescuing. Start with the Rust Belt ('Detroyit', Chicago, Philly, Jersey...).
"We are at an important juncture"
Zion and slavery or Restoration and Liberty.
"Governments are instituted among Men, deriving their just powers from the consent of the governed, --That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness."
I withdraw my consent to the DC US, and I never consented to Zion.
The banksters need to repay us.
The Four Rs
Rejection: Stop Paying. Stop Playing. Stop Obeying.
Revolution: It is inevitable, so prepare, as they are.
Retribution: The guilty must answer for their crimes against the American people and the Constitution. No “truth and reconciliation,” but “trial and Retribution.”
Restoration: Restore the American people, country and Constitutional republic.
If you want to change tomorrow for the better it is not necessary to invest more. It is necessary to spend better instead.
So let's begin by taking the axe to unnecessary wars and let us re-think the practice of extending life at all costs of an 80 plus year old who has no quality of life instead of managing their pain as they exit.
Perhaps we could limit the gynormous amounts of sugars in our processed foods, stop spending on Homeland Security which is nothing more than spending on a police state.
Perhaps we could put salary and bonus caps on bankers.
Perhaps we could ban politicians from borrowing on an interest only basis or even stop them from borrowing altogether thus forcing them to take the unpopular decision of taxing the people or the popular decision of reducing the size of government and its waste.
"Perhaps we could ban politicians from borrowing on an interest only basis or even stop them from borrowing altogether thus forcing them to take the unpopular decision of taxing the people or the popular decision of reducing the size of government and its waste. "
IF people really want something badly enough they will pay for it.
It has been way too easy for politicians to use debt as a means of pandering to the desires of people that would never invest their own time or money or attention.
When Uncle Sugar is handing out cheese people line up and no hunk is too big to fit in the cart. How long the line would be if the cheese was being sold retail by the oz is another matter...
ZH tylers are slipping today. Israel announced that it is joining the new Chinese Russian etc concortium as a founding member.
http://gata.org/node/15223
Parasites looking for a new host.
The cost to borrow is virtually zero and negative on future inflation expectations (whenever that happens)
We should be issuing longer term bonds and investing in science technology and our crumbling infrastructure among other worthwhile VERY LARGE SCALE projects (which I beleive the private sector can't do on its own )
Looks around the room, house, outside on the street?
What do I need that is worth investing in ... nothing.
After that it is only central bank inflation to prevent the national debt going into default and if you are in debt as EACH DAY PASSES your debt will seem less.
[PS ON LAST COMMENT YOU ARE A PARASITE IF YOU LOOK AT IT THIS WAY]
I am such a twat with 0 debt as you do not get rewarded for that like a central bank cutting you a cheque.
[NOT A PARASITE]
Look. Our economy caters to the wants of perhaps 30,000 very rich people. At best, meeting the needs of anyone else is a means to an end. At worst, the rest of the human race is a perennial threat to their rule, and their top priority is developing the means to dispense with us entirely.
No, we can't have renewable energy too cheap to meter. You better believe there's plenty of money for R&D into the robots and AIs who one day will replace us and the WMDs that will be used to clear us out of the robots' way.
Martenson's full of the royal "we" and can invest his own fucken money in battery technology if he wants, not mine.
tripe
Screw borrowing. Steal it like the Jews.
Another unicorn that thinks printed currency with nothing behind it is money.
I've got a much better idea. Lets just keep doing what we are doing.
It all seems to be going swimmingly!
No amount of jocky-ing the numbers, or buy backs or IPOs will create growth. It's an illusion. The U.S. has two simple choices: produce or perish.
there is no point in investing when there are no buyers
Meanwhile the cartoon shit circus continues.
As the economy tanks we get this kind of dog and pony show:
http://www.washingtonpost.com/blogs/wonkblog/wp/2015/04/02/larry-summers-and-ben-bernanke-are-having-the-most-important-blog-fight-ever/?tid=pm_business_pop_b
Are you distracted yet?
~ DC
What institution could we trust to act in our name?
Stupid advice. That is how we got here.