The Market Demands Liquidation, One Way or Another
Government likes to spend money that it doesn't have. The Fed accommodates government by creating new dollars out-of-thin-air, which is as unconstitutional as it gets. When government spends this counterfeited money, it creates massive economic distortions. Unviable businesses are started. Houses and buildings are built that shouldn't be built. Risky debts are piled up. The temporary cure to this government spending & Fed counterfeiting disease is recession. The permanent cure is to End The Fed.
Hello everybody and thank you for tuning in to the Liberty Report.
With us today is Chris Rossini, our co-host.
Chris, good to have you with us.
It's great to be with you, Dr. Paul.
Very good.
You know, this is our program.
We usually bring up subjects like the economy more often.
Also, we all have often mentioned about gold.
And there's a lot of activities this morning.
Gold is up high, higher than usual, but there were some stirrings in the banking industry.
A major bank in Silicon Valley looks like it's in trouble, and people are worrying about how much that's going to spread.
Is this the beginning of the big one, or is this just one isolated bank?
And the question is, how long will it take to bail out the bank?
Because they don't want this to spread, but ultimately, you know, these things spread and they can't control it.
And the thing that the authorities are facing right now is that they don't know what to do with the interest rates, and they're trying to outguest the Fed, but how can you outguest the Fed?
They can't even outguest themselves.
And what they're doing is the consensus with the Fed now is they need a recession because there's too much inflation.
And you have a recession by raising interest rates, but that goes against what they've been saying for a couple weeks.
Well, we could worry about stock markets more than we have to worry about correcting the mistakes they have.
So they have indicated, and of course the market has responded to that, and the markets, the stocks have been going down sharply, and gold has been going up.
So it's still a big issue.
And it also reminds me of the fact that we partner with Birch Gold, and they are very interested in the gold issue.
And I once again want to mention to our viewers that if you'd like to get some information from Birch Gold, you can text him at Ron at 989898.
And you can get some information.
It's free information.
Then you can decide from there if you want to get more involved.
But I would assume that most of our viewers have an interest in gold.
And the big issue is it's going to be around for a while.
It's been around a long time.
And it has its ups and downs.
There's a lot of control and manipulation.
That is essentially what governments have done from the beginning of time.
They would inflate the currency with diluting the metal.
And I see a little bit of that has been done just recently.
And they manipulate in a more sophisticated manner in the 20th century what our Fed was in charge of because we had the reserve currency.
And that was we could control the economy with manipulation of interest rates.
And we can bring on the good times.
And every once in a while, they get the bad times because they won't admit, yes, you artificially lower the interest rates.
It fakes it out with the people, the investors and the savers.
And they say, wow, you know, this is a good time.
The interest rates are low.
This is a good time to invest.
And of course, that's the creation of the boom.
So they're in a crisis too because they don't know what to do.
And I think things will get worse.
And the telltale sign will be is when everybody knows that their dollar has lost a lot more purchasing power.
And it's ongoing.
So this is the reason we talk a lot about gold because gold has been used over the many centuries to try to stabilize economies.
And it's also been used to rescue economies after the central banks of the world or the governments come and they inflate the currency.
They print the money and they get people to do things they shouldn't want to, they shouldn't be doing.
And so I think they're at a crossroads right now.
Even today might be a big day in what's going to happen.
So if you're looking for more info from Birch Gold, just go to Ron at 989898.
And I want to go ahead and thank our views, of course, for joining us today.
And I think I'm going to have Chris tell you a little bit because I think he's going to have a little disagreement with this headline on zero head.
This is not zero heads' position.
This is somebody's opinion, though.
It says recession is needed to curb inflation.
Well, that reveals a big mistake because how do they do it?
They raise interest rates is whether they want to do.
And if you have a healthy economy, if it's booming, nobody would say, well, a booming economy, it's going to cause inflation.
The truth is, is if you have a booming economy for free market reasons, interest rates go down and prices go down.
Anyway, they've been taught differently for 50, 60, 70 years about monetary policy and Keynesianism.
So what now?
This week, Powell again announced, changed his announcement.
Well, it looks like there's going to be a lot of inflation.
So we're going to crash the economy and have a recession because when they're in recession or depression, become destitute, prices are going to go down.
So it makes no sense whatsoever.
But that is the prevailing attitude in our universities, the prevailing attitude, except for the very few in Washington.
It's the prevailing attitude.
If you want a seat on the Federal Reserve Board, you've got to go along with this nonsense.
But ultimately, I believe the markets went out.
And if there is a requirement for liquidation of debt and a correction in the monetary system, the market eventually is strong enough to prevail.
And the best example of that was 1971.
And the predictions were made for decades.
Well, you can't have the Bretton Woods Agreement and give the United States the privilege of printing money forever and fix the ratio at $35 an ounce of gold.
And everybody knew it wouldn't work.
And then in 1971, the whole thing collapsed.
But it wasn't because the government decided on today we're going to have a collapse.
But Nixon realized something had to be done.
But what they were admitting to was the market won the battle and said you can't get away with the fraud any longer.
And it's been continuous.
It's just different stages of it.
So we'll try our best to deal with the stages right now that they're working hard to give us a recession because that's going to solve the problem of inflation.
Well, that's not going to happen.
Chris.
Right, Dr. Bong.
As we all know, government likes to spend money that doesn't have.
I mean, I think Biden is proposing a $6 plus trillion dollar budget.
They don't have this money.
They're $31 trillion in debt.
So what happens is the Fed usually will create money out of thin air for the government to then spend.
And when this happens, this creates an artificial economy.
It's a boom.
It's, you know, action.
It looks like things are happening.
People are making money, but it's fake.
You know, so a recession is what cures the fake.
You know, the businesses that shouldn't have been started are closed.
The buildings that shouldn't have been built are, you know, have to be used in other ways.
So, you know, so unfortunately, people think the recession is the bad part.
The bad part is when government spends money it doesn't have that the Fed creates.
The recession is the cure to it.
But they don't want recessions.
Some people even say we shouldn't even have them.
Like the fake should last forever.
You know, I believe Jenny Ellen said we wouldn't even see a financial crisis in our lifetimes.
Well, look, we're on the cusp of one, and she's a Treasury Secretary.
So, you know, people have been taught the backwards way, and the only way to fix this problem, A, is to let the recession occur so all the bad investments and debts are liquidated.
And the only permanent fix is to get rid of the Federal Reserve.
Very good.
You know, a long time ago when I was first started reading this and the argument about inflation, and they wanted just to talk about prices going up, and that's what you have to deal with.
You deal with that by manipulating the economy, giving recessions when you think prices are too high, and this sort of thing.
So I always thought that this was just a semantics problem.
You just clarify, you talk about, you know, the price is going up for certain reasons, or the economy has to go down.
But none of this stuff, you know, is what is acceptable.
But the CP, they want us, and I found it in Human Action, Mises' great book, and he said it's on purpose.
He said the establishment doesn't want you to think about the real cause, which is the, you know, the monetary management, the money manager, those are the people that are causing the trouble.
They want you to think of prices, think of wages, think of the businessman gouging, think about the weather, think about wars, and all these, make all the other excuses, but they try desperately to guide you away from the Federal Reserve and the money managers.
And that's also one of the reasons, once I discovered that, that really what needs to happen, at least the start of the reversal of this, was just get to know what the Fed is all about.
And that's why I emphasize so much having an audit of the Fed because I always believe that the people, if they have the information, they will wake up to it.
And the distortions, though, you get from the government are usually on purpose to misguide us.
But their goal mainly is to benefit the special interests can benefit.
And that's why inflation is universally accepted.
And so everybody has a special interest route anywhere from the corporate interest.
Now we have so many military-industrial complex and pharmaceutical industrial complex.
So everybody's dependent on this, all types of welfare.
So you can't have a free market economy without an understanding of this.
And the people that oppose what we're talking about in a free market, they like this because they say, oh, look at what happened.
You guys want a free market.
And look at what we have.
You have your free market going on and you get a Republican in and the same things happen.
See, that's a distortion.
I'm making an excuse because it just happens that if you look at the deficits, that's not a one-party system problem.
That is done by both parties.
If you look at the military-industrial complex, but we always see openings and some changes, and some are better than the other.
But basically, it is an issue of how can we introduce and convince a whole generation of people and compete with the manipulation and the brainwashing they get at their universities and through everything that is government, all the regulations that they manipulate.
That is a job, and that's one of the things that we try to do here at the Liberty Report: is get the information where people know why If the market says you have to have liquidation of debt or things won't recover, yeah, it sounds like bad news, but it's really good news.
We know what the problem is, you know what you have to do, and we know it's limited.
It's sort of like somebody comes in to see the doctor, and they're saying, You have a really bad disease, and you have to have a major surgery.
And you say, Well, that's horrible news.
No, it's operable.
You can have this out and you know, your surgery done and be over with.
So, if you know and understand the truth, I think it's beneficial.
And rather than trying to hide it, but the reason they want to hide what's really going on because the special interests immediately want the benefits, and they want to hang on to their benefits as long as they can.
Chris?
Yes, very good, Dr. Paul.
And, you know, I wanted to talk about presidential presidents because while more people than ever, I believe, you know, know about the Fed and pay attention to the Fed, most still do not.
But they do pay attention to presidents.
And the presidents get credit and blame for what the Fed basically is doing.
You know, and I believe Trump was a better president than Biden for sure.
But, you know, the economy under Trump, it's very misleading to think that he was some kind of magician because it was money pumping that was pumping up the economy and it made things look good.
So he was lucky in that sense.
Right now, Biden's getting the hangover, you know, and Biden's policies are terrible.
You know, what, maybe 99% of them, but this was inevitable.
You know, when you have an artificial boom, there's going to be a bust.
And whoever's president at the time is going to have to deal with it.
Now, of course, Biden is going to deal with it the wrong way.
But the point I'm trying to make is it's not smart to fool yourself to think that the Trump years were some kind of economic miracle.
They were not.
They looked like it.
But we're getting now the hangover to all that money pumping, all the spending, all the debt.
And, you know, so it's the people that watch this show are in a select group.
You know, it's the Federal Reserve.
But most people outside, you know, they think it's Trump.
They think it's Biden.
This guy, that guy.
You know, they're really just where they are at the time, and they either take the credit or the blame.
Very, very good.
And your points are well made.
You know, Powell was really in action this week and making the warnings.
And he's going to get his recession, it looks like, because it's inevitable.
It's just when it's going to start and how bad it'll be and how long it's going to last.
But he was arguing that we're looking at the figures, we watch it, and it looks like there's strong economic activity, which should be questioned because I personally don't trust most of the statistics that they give us because it's always a manipulation.
But he's warning this, and then, of course, he sent the message on, if it's coming, economic activity, too strong that we want.
So we're going to have to raise interest rates.
Raising Rates Amidst War and ESG00:04:03
And look at what it did to the market, and we'll continue to do.
But tomorrow they may come up with a magic pill and convince enough of the investors, well, we'll shift gears, Gone.
Maybe they're going to keep this thing going for another year or so.
Who knows?
But the inflationists aren't going to give up very easily.
But there was another clip in the news, Chris, that I found fascinating.
And this was on anti-war by Dave DeCamp, who's one of our favorite people to follow.
And the headline is: Zelensky, BlackRock CEO, agreed to coordinate on Ukraine's reconstruction.
What?
I thought we just spent billions and billions of dollars tearing the place up, paying for all this bump.
I've noticed that over the years, and when I was voting against the spending of the bombing, I said, who knows before you know it, we'll be paying for the repairs.
It happens almost always.
So we end up getting hit twice.
But at this meeting, it was estimated that, and Zelsky is not bashful.
You ever notice that?
He just comes out.
I need some money.
How about $100 billion or a couple hundred billion?
Well, this one is the World Bank has given them a hint on what to do, has estimated rebuilding Ukraine will cost $525 billion or up to $630 billion.
They don't know, but they're throwing those figures out.
And if you don't do that, you're a promoter of terrorism and World War III.
So you have to go along with that.
Now, I found it interesting because, you know, BlackRock is run by Larry Fink, and he is a champion, at least when he can get away with it, with ESG investing.
You make your investments not for investment reasons.
You take the malinvestment that goes on anyway just because of the interest rates and the system we have.
And then they add on this: that what we do is we are very much aware of the social climate and the environmentalism and all the governance and how you can present and provide for great government.
So they'll go with ESG investments.
And I got to thinking, you know, how is that going to help when they're rebuilding from a war that we paid for essentially?
But, you know, they're going to add that factor in.
And the guide will be to get the people to respond favorably because, oh, boy, yeah, this is good.
We're going to do it the right way and we're going to protect the environment.
It is so much nonsense that I've, in my own mind, decided what we need is a lot less government protection of our environment and a lot more private property rights where the property owner takes care of the rights and don't get punished if they do something that helps their property.
You know, in this day and age, if you defend your property from a horde of thugs coming in and tearing your place up and robbing you, if you just hold a gun up and don't do anything and say, get out of my place, the thugs get out.
They get money and rewards when they go to court.
And then the owners can get arrested for holding up a gun.
So that's that type of investing.
It doesn't sound to me like that's a good option for what's going on now.
And to compensate for the silliness that has been going on in Ukraine for a long, long time, especially since World War II, and especially, you know, since 2014 when we participated and promoted the coup to kick out an elected president at that time.
Why Crypto Offers a Change00:05:21
Chris?
Right, Dr. Paul.
Yes, private owners always have the incentive to take care of their property.
The biggest polluters in the world, even today, is the U.S. government with the military empire.
They are the biggest polluter.
Yet they want to tell us how to not pollute the earth, I guess.
They're the ones that are going to tell us.
So, you know, it was the same way with the Soviet Union.
They were massive polluters.
You know, there's no incentive.
If you don't own it, you know, it's the same thing with a rental car, a rental house.
After people are done with it, it's often trashed because it's not theirs.
So I will finish up, Dr. Paul, with my closing thoughts.
As I said earlier, more people than ever, I believe, and I would say it's largely due to Dr. Paul, what he has done over the decades, know about the Federal Reserve.
I remember reading him and his speeches 20 years ago, and it was, you know, people just didn't know about it.
But because now 20 years has passed, and a lot more people talk about the Federal Reserve, people that are into gold know about the monetary system, how messed up it is.
People that are into Bitcoin, same thing.
You know, when you go on Twitter and read people that are into Bitcoin, they understand the fiat money system, how messed up it is.
And, you know, they believe that Bitcoin is a solution.
So the point is, a lot more people are talking about this today.
And that is all for the good, because that's what needs to happen in order for change to happen.
It's still not a majority, and it may never be a majority, but you don't need a majority for change.
Change is made by minorities that are strong enough.
And that day may come someday where we actually have sound money, and we should all play a part in helping to make that happen because we know what it's like to live like this.
And we just know that it's wrong.
So if we can learn about the financial systems, learn why sound money is superior, and then tell others, you know, then you could do your own little part in making a massive change.
Very, very good, Chris.
You know, I'm going to finish up by making a few comments about cryptocurrencies and admitting from the very beginning and following up on what Chris says, you know, we don't know exactly how cryptos are going to work out.
And there's a lot of strong feelings and beliefs and convictions, pro and con on crypto.
My general position over the years, even when I was back in Congress, was to make sure that it was legal to use something other than the Federal Reserve.
And that's why I had a bill in to repeal a legal tender law.
And you could use anything you want, but you couldn't ever use fraud to deceive people and lie to people.
You can't have a pseudo-gold standard like the government has and tell you, oh, we really have the gold.
No, you couldn't commit fraud, but if there's an alternative to it, an electronic age and a computer age, I mean, there's all kinds of things that might be used.
And the question is, who's winning the argument?
The people who say it can't ever work.
It's not enough like gold to work.
And others will say it is going to work and it's going to be the currency of the world.
I don't know the answer.
And I don't think the market totally knows the answer.
And maybe it'll come in between.
Maybe there will be crypto gold currents or whatever.
But I think that the one thing about this, why I find it fascinating, is how did so many people invest so much money in crypto?
And I think for two reasons.
You know, we've inflated like crazy in the last 10 years with monetary inflation.
So there's tremendous money out there.
And with the interest rates lower than they should be, you get malinvestment.
And that's what we talk about a whole lot.
People make mistakes.
And they might build too many houses and too many hotels and too many cars.
And then you have too much debt.
And then you have to have the correction.
And that's the malinvestment.
And some people say, well, that's inflation.
And they want to protect.
So they know that gold has been used for centuries.
And others argue that, no, no, crypto will protect you.
So you have to get hold of crypto.
And they see that crypto is a protection against the current system.
And I don't think the answer is in on that one because I don't think anybody knows which way it's going to go.
But in a way, it's a result of inflation.
But others say that you have to have crypto to protect against inflation.
Because if you just set it aside and say they're printing money like crazes and prices are going too up too high, I'm going to protect myself against the inflation.
So is it part of the inflation and the mistakes they made, or is it because somebody is trying to protect?
It's probably a mixture of different reasons why people do this.
But I was interested in the monetary issue mainly because it made a lot of sense to me.
And as a libertarian, I don't want to impede anything when there's a freedom of choice and another option.
Government Interference and Financing Problems00:02:27
And that is why I think the government messes things up so badly.
They're just interfering with volunteerism and contracts.
Live up to your promises.
And they want to get involved and they get involved too much protecting corporations.
I think, you know, over the years, you know, I said, well, it's the labor unions.
They push the wages up.
They cause the inflation, which isn't true.
And then they come along and they say the government should help the corporations, just like this bank we noticed today is going bankrupt, implied, oh, it's probably going to get a bailout.
Look how many times the banks have gotten bail out.
So it's one of those things that, you know, they do the wrong thing, and people have to realize that the special interests are so powerful.
The thing that I'm most concerned about philosophically in the economy is corporatism, something that invites corporations to take over and losing the benefit of somebody easily saying, oh, it's the government that's restraining our First Amendment rights.
But it might be the government working with a big social media.
We'll punish them.
We'll cancel them.
We'll punish them.
And then they work together and it's the social media that's carrying out the restriction.
It gets a little bit messy there.
And I think corporatism is very, very dangerous.
That's where the money control is.
And you have pharmaceutical industrial complex.
You have all kinds of military-industrial complex.
Now we have the medical industrial complex.
Well, I guess we have to thank Fauci for exposing them.
You know, how corrupt they are.
And that is so sad.
And that really hurts me because there's a lot of good physicians out there that have fought that.
And a lot of them got punished over this.
And that needs to be sorted out.
And to me, whether it's the financing and any problems that we have, it isn't that difficult.
Just follow the rules.
And somebody says, well, where do you start?
Where do you start?
And I don't think it's a question on where you start.
Why don't we get people to start by reading the Constitution and then find out that peace and prosperity can be best brought about by emphasizing personal liberty.