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Thursday, July 10, 2014

Jim Rickards montage defines the Economic Depression (2007 - Present)

Hound Notes: Jim Rickards is another Investor-Economist that I listen to. I first discovered him listening to King World News, six years ago when this downward cycle began. He has his finger on the pulse. He's a very educated and studious man.

I hold Mr. Rickards in the same  regard as the late Bob Chapman. Mr. Chapman passed away a couple of years ago from cancer. You can go back and listen to Bob Chapman presentations, on various radio shows, on Youtube. The guy was prescient. Mr. Rickards is also prescient.

Our government has been great and kicking the can down the road, but they have bought us time to nowhere. If we had dealt with these issues back in 2008-09, then we could be growing again. No one can predict when the panic will begin, but people with common sense can see that it is coming.

Here is a montage of Mr. Rickards from three shows over the past week. The common themes are that the Dollars value is based on confidence and the Federal Reserve has taken that confidence for granted.  When the Fed finally destroys that confidence, then it will lead to a panic as the Dollar collapses. We have been in a Depression since 2007 and it is structural. You can't solve structural economic issues with monetary policy.

1) Boom Bust - RT
Competitive devaluation of currency does not help exports. It creates inflation. The Fed can never taper. Last September was the last chance.  If they tapered, they will taper into weakness causing a recession. This is what happens when you manipulate markets. Lower unemployment will not mean Fed will taper. Unemployment is going down for the wrong reasons. Workforce is shrinking. GDP is the sum of Labor Force participation and productivity.

2) Porter Stansberry Radio
Inflation isn't bad because of the lack of velocity of the money supply. We are in a Depression. Need structural changes and a change in confidence. Stansberry defines the jobs of today and structural changes. Rickards says we shouldn't lament the loss of the old jobs. We need to move on economically and create the new jobs. Bad debt hasn't been written off. We have copied what Japan did back in the early 1990s and they have never gotten out of their malaise -- 25 years later.

3) Alex Jones - Infowars
Allies are leaving the dollar, not just China and Russia. World Reserve Currency has collapsed three times in the past 100 years. After the system collapses, what comes next. Fed has has 15 policies since 2009. They don't know what they are doing. There will be a collapse of confidence. You can have growth in a Depression , but what we are seeing is a growth negative compared to trend. Historical trend is 3.5%. What we have seen is 1% to 2%. Look at the lack of Unemployment. Look at the EBT system -- modern day soup lines. You can put a panic on top of this and this is what he sees coming.

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