As much as I hate to invoke The Ayn Rand lest I give off the impression I'm some kind of Objectivist, which I am most certainly not, the engine of the world is coming to a halt.
Money velocity has been falling for years. It is now cratering as we hide in our homes from a bug that eventually we will all have to reconcile with. Credit is the engine of the world of today.
It is the gas which fuels the engine of the world.
[Ron: Credit is debt! The reason our world is a dystopia awash with unemployment, poverty, social unrest and warfare is that it is run by JOO banksters who charge us interest for "credit", ie fiat debt tokens fraudlently called money that the banksters conjure out of thin air using keystrokes on computers. Accordingly, credit DOESN'T fuel 'the engine of the world', it destroys it. People using their ingenuity and labour are both "the engine"of our world and the fuel driving it.].
COVID-19 has cratered the global economy exposing the internal rot within our hyper-financialized global economy as nothing more than a pyramid of Ponzi schemes...
... piling credit on top of credit until there are no more greater fools to sell the new debt to.
That's the system we have. And it is collapsing precisely because the world is situated at the point where there is little more productive capacity to monetize and pull that capital from the future to fund the new debt.
It won't matter if we replace this system with pure helicopter [Ron: fiat debt token] money without debt as the Modern Monetary Theory proponents argue. We're already doing a version of this by having the central banks buy debt they never intend to sell on the open market. So, the debt itself is without value. The money printed from those bonds is as much scrip as if the bond had never been issued.
[Ron: The currency printed by the Fed and provided to the US government for bonds is debt and has no real value, BUT the Trump Administration is using it to perform the task of lubricting the processes needed for the creation and transfer of goods and services within the US which is the only function that currency or money should be used to perform. Ideally currency should be without value, ie usury free, so that it is not a store of value that can be hoarded and/or used to distort community life by being used to control people. If currency is not perceived to have value in itself, people will more freely use it for its real purpose which is to facilitate the exchange of goods and services. THAT automaticlly increasses the velocity of transmission of the currency and hence the creation and exchange of goods and services. The more that happens the more trade and employment will increase and the community will prosper.].
The purpose of having the Fed BUY debt is so that, in due course the Fed and not the US nation will own all of the fraudulently created debt the Fed has issued
But the time lost by people in pursuit of uneconomic ends by mispricing risk and servicing debt they are legally obligated to service is real.
The engine is sputtering as trillions are printed to kick it back over one more time. But the gas has too much ethanol in it. There's not enough air.
The engine is dying.
[Ron: DUH! That is why the Trump Administration is forcing the Fed to buy the debt so that the US Treasury can RESET the monetary system and start creating and issuing usury free assert backed money or currency.].
And it can no longer outrun the abyss swallowing the world staring back at us saying, "Thanks for the snack, those frackers and restaurants are tasty, but I'm still hungry. Who's next?"
[Ron: This viewpoint is misconceived. Once the Fed owns the debt the US Administration will RESET the monetary system, declare a debt Jubilee and eliminate income taxation. Those changes will ensure almost instant prosparity for everyone except the banksters and their lackeys, enablers and minions.].
I've been very clear that Europe is the next big meal for the Abyss.
In the end, a home builder here, an over-leveraged bank there are nice. These are but apéritifs in the grand scheme of things. They are like sugar to a starving child, revving it up but not fulfilling its real needs.
Europe's troubles are multiplying because the basic premise of how to fight this virus and the deflation it is engendering is functionally flawed. More money dropped from helicopters isn't the solution.
[Ron: The Plan being used in the US is also being used to free the EU and the rest of the world from bankster control.].
Freeing Europe from the euro is.
And it will set Italy in the post-COVID-19 world at odds completely with the rest of Europe.
[Ron: I disagree for the reasons mentioned above.].
Ambrose Evans-Pritchard adds more color to what happened at last week's meeting of EU national leaders in which both sides of the fiscal divide dug in their heels.
Dutch premier Mark Rutte has become the spokesman for the hardliners - giving political cover to Germany - categorically ruling out emergency "coronabonds" or other forms of debt mutualisation. "It would bring the eurozone into a different realm. You would cross the Rubicon into a eurozone that is more of a transfer union," he said. "We are against it, but it's not just us, and I cannot foresee any circumstances in which we would change that position."
Enrico Letta, Italy's former-premier and an ardent EU integrationist, accused the Netherlands of leading the pack of "irresponsibles" and trying to "replace the United Kingdom in the role of ‘Doctor No'". The reflexive use of the UK as a rhetorical foil evades of the true issue. It was not London that blocked moves to fiscal union over the last decade; it was Germany.
Pritchard brings up the spectre of Lega's Matteo Salvini coming back into the picture, especially as the mood sours among even the most ardent Euro-integrationists like Italian President Sergio Mattarella.
Merkel is hiding behind her quarantine and letting Dutch Prime Minister Mark Rutte speak for her. And that is driving the Italians to the point of no return.
Giuseppe Conte's government is at a loss to fight the virus. It was ignored by the EU when it asked for help it paid for when this began. As Pritchard points out, what purpose does the EU serve when it won't act to help a member in need as it is supposed to do?
The answer is the EU's purpose is to be obeyed.
Italy's two ways out of this mess is leaving the euro or forcing the northern bloc to cry uncle. But that has to occur within the prospect of removing so many internal roadblocks to Italian economic growth, starting with the euro but entailing much wider reforms, which are most definitely not on the post-Keynesian/MMT technocrats' agenda.
Italy's debt numbers are a large part of the hunger of the Abyss and no amount of blackmail by them and France will get Germany to go along with bailing them out.
I discussed these issues and more at length with Alexander Mercouris of The Duran in this series of videos we recorded over the weekend (here, here, and here) in which we tie Europe's collapse to all the other things we're experiencing in the world right now.
Most EU economies are fundamentally hampered by the ossified bureaucracy of the EU which is an over-layer of domestic bureaucracies.
[Ron: Although the cultural Marxist EU bureaucracy is part of the problem it is merely a puppet appendage of the Talmudic bankster cabal that controls the global central Banks and the Fed. THAT cabal and its usurious monetary cum fractional reserve banking system is the real source of the problem. That usurious globalised banking system must be eliminated and replaced by every sovereign nation creating and controlling its own usury free money creation and distribution system.].
And, as such, these national systems are barely capable of acting in a coordinated manner normally, no less with the EU enforcing its fiefdoms at the same time in the face of overwhelming strain.
In all situations the primary objective of all organizations is survival. All else is secondary.
The more credible the threat the more extreme their response.
They will dig in to protect against that threat rather then fulfill their stated mission. In the case of the EU that means using this crisis as the excuse to force fiscal integration and monetary reform on those that don't want it as a means to survive.
Because in a crisis period there is no time for such luxuries as national sovereignty. There isn't any reflection that the organization itself is the source of the problem. The organization is a default setting.
[Ron: I disagree. The unelected EU bureaucracy is a puppet arm of the Tamudic global bankster cabal and it has been deliberately established to eliminate national sovereignty in order to further the banksters' New World Order, One World Government agenda. The pseudo coronavirus crises has been created by the bankster cabal using a typical Hegelian dialectical process designed to stampede nation states in the EU and elsewhere into accepting further loss of national sovereignty. It is also being used in an attempt to extract huge sums of money for use by the bankster's EU and UN puppets and minions in what virtually amounts to a last ditch "go for broke"effort by the Talmudists to seize control of this planet. See eg: United Nations Wants 10% of Entire Planet’s Annual Income in Fund for Coronavirus Response - http://abundanthope.net/pages/Political_Information_43/United-Nations-wants-10-of-entire-planet-s-Annual-Income-in-Fund-for-Coronavirus-Response.shtml
This final Talmudic bankster effort to seize control of this planet will fail. The Triodity of presidents Trump, Putin and Xi and their supporters together with many other world leaders are ousting the Talmudists from power NOW. They are also freeing multitudes of children from enslavement torture and death in underground prisons and also freeing the rest of the global population and the planet from demonic control. So be it.].
And now both sides of the fiscal debate are seeing the other for what they are and the result will most likely be an irreparable fracturing of the European Union.
Italy has now seen the true face of the EU. Conte has now tried histrionics to get his bailout, which won't actually solve anything, because he's aligned with the Euro-integrationists. What his country needs is a new currency and different leadership.
But he's held onto power because his opposition would have already broken with the EU.
Like the obsequious worm that he is, instead of doing the right thing, issuing mini-BOTs, to free up domestic liquidity issues, Conte is looking at putting up the whole of the Italian government's holdings as collateral against new debt to pay for stimulus of Einsteinian proportions.
This is the ultimate sellout of Italy to the EU. As a proposal it is the ultimate betrayal of the Italian people. These buildings and infrastructure are their legacy and they will be sold as collateral to loan sharks as opposed to reclaiming their national dignity.
There is no market for these bonds. So,who will buy them? The ECB.
Who then owns all of this property, ultimately?
The ECB and therefore the EU.
[Ron: If the ECB buys Italian debt it will own that debt and NOT the Italian assets.].
This is a proposal designed for Merkel to take back to home to the Bundestag and sell to the German people. If they bail out Italy, they will get something in return for their risk.
It'll be just like they did with Greece in 2015, except then it was Germany forcing this upon them rather than the satrap Italian government offering themselves up like lambs.
But even with this desperation attempt to find buyers for their debt, Italy is facing a bleak future without serious reform.
And the odds are about equal at this point as to whether Germany or Italy breaks the EU. Because neither side can live with the other under the other's terms.
At it's core, however, this fight is a symbolic one over the continued belief that government can provide the solutions to our problems rather than being the source of them in the first place.
[Ron: Governments are only the source of their nations' problems because they corruptly grant private corporate bankster free and exclusive rights to create and issue the nations' currency subject to interest (usury). Governments should issue their own money and currency free of interest.].
Socialized markets with bureaucratic controls are incapable of reacting in real time to swiftly changing conditions. No amount of helicopter money will change that. No amount of taxation as social engineering tool will create preferred outcomes.
[Ron: If sovereign nations issue their own money and currency usury free they will NOT NEED to levy income taxes to pay banksters the interest they charge for lending currency into circulation. THAT is not only the preferred outcome but it is the ONLY legitimate outcome.].
Because remember when you advocate for things like that, you're putting in charge of those taxes the same people who are mismanaging them now. Our governments aren't staffed and run by angels. These are the same misinformed, mal-educated, biased, myopic, flawed people as everyone else.
[Ron: Granting private corporations the FREE AND EXCLUSIVE right to issue a sovereign nation's money isn't just myopic and flawed, IT IS CRIMINALLY CORRUPT.].
In short, they are human.
And they have the same pretense to knowledge everyone else does. And they will make the same mistakes as everyone else. Under the pressure of outrunning the Abyss the character of the people in charge of the money reveals itself.
[Ron: Arguably, although the individuals controlling corporate govenments like the US Inc and the Commonwealth of Australia, the IRS and the "Australian Taxation Departmernt" may be humans they also appear to be demonically possessed and therefore lacking in human conscience and empathy. Those individuals have actual knowledge of what they do and why. In other words the current fraudulent global money creation and fractional reserve banking systems are NOT due to mistakes. Those corrupt systems are the results of DELIBERATE thought and action by Talmudists. Moreover, the Triodity of Presidents Trump. Putin and Xi and their many supporters around the world KNOW what the Talmudic banksters have done and intend to keep doing and they are taking action to prevent that and to eliminate the banksters' corrupt and usurious systems.].
All that does is create the false signal of stability while perpetuating systems that are wholly inadequate to the job. COVID-19 has exposed them ruthlessly.
[Ron: COVID-19 isn't a virus it is a deliberate operation to exposure and destroy the Talmudic controllers of our world.].
And still the Abyss stares back, like an implacable kidnapper, demanding its payday. Because there is no escaping the it.
[Ron: The Talmudic Abyss is being eliminated NOW. Christ Michael Aton the creator of this universe declared the commencement of his Millennial Reign on this planet on 5 February 2019 and his Reign will become obvious globally when COVID -19 concludes.].
So, while you can chuck funny money in there for as long as you want it doesn't create value. It doesn't produce sustainable outcomes. It produces theft and graft, it extends the grift, bails out the unproductive and punishes those that honestly went about their business.
[Ron: That is why soveriegn nations MUST create and issue their own money and not grant private banksters the right to issue 'funny money'.].
Digging holes and filling them in doesn't produce wealth anymore than breaking a window stimulates aggregate demand for glass.
[Ron: That is why properly constituted governance authorities must retain control of the creation of money and/or currency AND ensure that it is only issued in return for provision of real goods and services and legitimate community needs. Arguably providing currency to citizens unemployed as a result of government policy and to ensure that vital production facilities, employemnet opportunities and necessary infrastructure is preserved in working order, IS a valid use for provision of government funding.].
It just creates an accounting fiction which costs twice as much as having not dug the hole or broken the window in the first place. It may delay the Abyss from swallowing you until tomorrow.
Until, of course, you run out of time.
And then there won't be enough credit in the world to keep the engine of the world from sputtering and dying. That's when real leadership is needed.
[Ron: Arguably this thesis is totally misconceived.].
* * *
[Colour fonts, bolding, underlining and comments in square brackets added.].
Join my Patreon if you don't want to stare into the Abyss. Install the Brave Browser if you want to help keep the Abyss at bay.
The Monetary Abyss Stares Back and Asks Who’s Next ? - http://abundanthope.net/pages/True_US_History_108/The-Monetary-Abyss-Stares-Back-and-Asks-Who-s-Next.shtml
United Nations Wants 10% of Entire Planet’s Annual Income in Fund for Coronavirus Response - http://abundanthope.net/pages/Political_Information_43/United-Nations-wants-10-of-entire-planet-s-Annual-Income-in-Fund-for-Coronavirus-Response.shtml