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Jan. 19, 2024 - Ron Paul Liberty Report
29:49
"Bidenomics" Lies And The Fed's "Rescue" Operations

Just the term "Bidenomics" should make Americans cringe. It implies that government is outside and above actual and immutable economic laws. Whenever you see "omics" appended to a politician's name, beware. You're being fed yet another fictitious "narrative." You don't need the government or the media to "explain" your economic situation to you. Their "explanation" will rarely, if ever, match reality.

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Sound Money and Inflation 00:06:45
Hello everybody and thank you for tuning in to the Liberty Report.
With us today we have Chris Rossini, our co-host.
Chris, welcome to the program.
Happy Friday Dr. Paul.
Great to be with you.
Very good.
This is the day we concentrate to some degree on economic policy.
But I always argued with those people interviewing me during the debates that one week we'll talk about the economy and the next week we're going to talk about foreign policy.
I never could separate the two because, you know, wars cost money and it affects the markets and all that.
But anyway, it is true on Fridays we tend to talk more, you know, about economic policy.
It's also the time that we remind our viewers to try to take care of their personal affairs and make sure that they're paying attention to gold.
But I don't think that's anything new for our viewers to hear because I would assume most have heard us talk about sound money.
It's hard to talk about sound money without talking about gold.
So we do that and that's why we have a partnership with Birch Gold Group.
And they are involved in trying to get people positioned for bad times ahead.
Now right now, I don't think there are many people who disagree with that.
You know, even a Democrat once said, things look tough around.
So people are starting to realize that it's in the news and then all of a sudden, you know, there's a lot of fudging.
There's a lot of distortion.
There's a lot of faking.
Some people call it lying to hide what is actually going and what's actually doing in the marketplace.
We'll talk a little bit about that.
But I want to mention one thing that there's some misconceptions sometimes about inflation because most people know, well, they assume that the final definition of inflation is prices going up.
We have too much inflation, too much inflation.
But they don't say where it comes from.
And they don't emphasize that, and we do.
We emphasize the Federal Reserve and the money creators and credit creators and all the mischief that adds fuel to the fire.
And this is the reason we talk about gold and that we work with Birch Gold.
And if viewers have not already done it, I would advise they take a look at the text number on the screen.
It's text Ron 989898.
And you can get in touch with Birch Gold who will send you materials on how to invest and what's going on in the gold market.
So if you would like to do that, there's no charge to this.
And that again, once again, it's text Ron 989898 and they will send you some materials.
And we will continue to talk about gold and why it's important.
You know, excuse me, you know, the definition of inflation is, of course, very important because we stick to more of the Austrian thesis that it's increased by inflation comes, inflation, price inflation comes from the fact that the value of the dollar goes down.
That's the basic concept.
But there's a lot of people who still say, oh, it's profiteering.
People are making profits.
They're making too much money.
All the inflation comes from profits.
And then others say, oh, no, it's labor unions.
It's labor union labor costs.
Labor costs are going up.
It affects prices.
You know, those are just half-truths.
They're not the causes that they're talking about what antagonizes and probably causes more problems with some of the price levels.
They do go up.
But if we concentrate on that, they will.
And this is what the progressives and liberals have done for years is they will concentrate on business people and say they're the cause of it, so therefore we have to regulate prices.
Same way with labor.
Oh, the labor unions demand more money.
They're trying to catch up with the prices going up.
So it's back and forth.
But labor costs in a free market, if you had sound money, would not automatically go up and cause inflation.
That is not the cause.
Inflation is the devaluation of the currency.
The dollar becomes less, and you need more dollars to buy groceries.
And it's no more complicated out.
If you drift from that, there will be distortions and there will be things that add to it.
Some people say, Ben, I've heard some good libertarian free market people say, and they'll point blank and say, well, deficits have nothing to do with it.
That isn't it.
In a way, that's true.
But I modify that by saying, no, debt in itself doesn't cause the inflation unless you have fiat money, unless you have a system where you can endlessly spend.
And if nobody will loan the money legitimately to the government, what they do is then they have the Federal Reserve print the money.
And so deficits are a key instrument that puts pressure on the money authorities, but that isn't the cause.
Many times over the years in dealing with the Federal Reserve Board Chairman, I would bring this subject up, and they were all consistent in saying they threw all the blame back to Congress.
Well, our job is tough, and what you point out is right, but it's the Congress that are running up with this debt, and it's used as an excuse.
Of course, the other way you could look at that is maybe the Congress spends the money because they know the Fed is there.
They created the Fed, and the Fed is there to cover their mistakes of spending too much money.
But the Federal Reserve's official position is the deficits are really the main cause.
But it's a whole system.
It's the system of fiat money, a system of economic planning, and all the mischief that goes on and the problems that we have today that causes the trouble.
But it boils down to the suffering that the people have when they go and shop in groceries.
There's a big difference between somebody who goes to the store and buys things on a routine basis and they have to deal with a budget.
And that means the average person running a household are very much aware of how much inflation there is.
Bidenomics: Never Been Better 00:02:17
If you're very wealthy and you never go into a store, that's different.
They're not worried about it.
But nevertheless, Chris, I think it's very important that we do our best to get that message out where the problems are and why gold is important and why it's good for people to get in contact if they're looking for more information for a company like Birch Gold.
So this is our position, but today we'll talk a little bit about Peter Schiff because he's been into this argument for a long time.
And he's written some stuff which he's written before, but he's had some things recently trying to show how the distortions are and how they distort and lie statistics in order to convince them, oh, things are okay.
You know, there's this problem over here.
But he points out some of the things that, which we'll get into during the program.
But Chris, welcome again to the program.
Thank you, Dr. Paul.
We'll start with the term Bidenomics, which should make everyone cringe when they hear it.
And not just by, this isn't a partisan thing, Reaganomics, the whole thing, great society, New Deal, Fair Deal, Square Deal.
It goes all the way back.
It's government intervention.
And the truth is, there are economic laws, period, and they can't be broken.
And all these nomics, Bidenomics, Reaganomics assumes the government is outside of this.
They are outside and above these economic laws.
And they come up with these special formulas to make the economy great.
They have charts and graphs and experts that are all over the media explaining why this government intervention is so good.
You know, they think it's like a machine, the economy.
They turn a few screws here and flip a few switches there and presto.
And wouldn't you know that things have never been better?
Bidenomics, it's never been better.
You know, so I mean, it's all comical once you see what's going on.
And in truth, you don't need the government to explain or the media to explain to you your economic situation.
You have your own bills, you have your own expenses, your own income.
Landing Explained: Crashes Ahead 00:06:20
That's all you really need.
You have your own eyes and ears.
You can see what's going on.
But they're there to basically tell you that all your senses are wrong.
You know, if there's a problem, it's you.
It's not them because everything they're doing is great.
And, you know, we're a long way from this, but how the government should deal with the economy is to stay out of it.
That's the only thing that they should do.
Do not interfere.
If people use force, if they use fraud, then the government steps in and you punish those people.
But that is not going to happen.
And not only do politicians not want that, but the people don't want that too.
The people want the government to interfere.
So that's what they're going to do.
And that keeps us in business because we can come on on Fridays and explain why all their interferences are only going to make things worse and not do what they claim.
But that's really, you know, the only solution to all these by dynamics is to just get government out of the economy.
That sounds like a good idea.
You know, Peter has frequently over the years talked about the unemployment or employment statistics and the reports coming out and there'll be anticipation for two or three days and one hour before and now we're going to have it.
Were there more jobs or less jobs or whatever?
So he looked into that because sometimes there's some tricks they play.
And he found out that, you know, what happens so often is that there'll be a report and they say, well, things are okay, but they're not doing super and we're going to have so many new jobs.
And then all of a sudden the report comes out and it was a lot more, 50% more, double, all of a sudden.
Wow.
So when the first report comes out, they're prepared for a really bad thing.
And then the next thing is it was super good.
And then about a week or two or a month later, then they have revisions.
And this is not because they make mistakes.
Their whole system is a big mistake.
But they don't make mistakes on these statistics.
It's all planned to get people off balance and try to handle the markets because not everybody hears about the revisions.
But eventually the markets are very powerful and will tell you if the economy is getting weaker.
Right now they have these statistics to show that things are going pretty well.
The employment rate is up high.
But what Peter has done, he pointed out that there's a lot of jobs that a lot of people get in second and third jobs.
And they add those in and they replace full-time jobs.
Then all of a sudden, well, people don't want to have a second and third job just to survive and be counted in a positive way.
And the full-time jobs are disappearing.
And this is all part of the system of governments basically being dependent on lying and fibbing and regulating all these events.
But I think what Peter does, he points out very clearly that you should be careful with these statistics because especially, I don't know how the short-term traders do this.
I think they know what's going on.
I think the traders who end up being able to sort this out, they know it.
They know there may be a false run and they know they better be in and out quick.
But that's just not real investing in the sense of what are you going to do to invest and have a nest egg for your family for retirement or send your kids to school.
So it's quite a bit different.
And this falsehood, but they do this casually.
It's no big deal.
It's their job.
And otherwise, there'd be a rough landing.
It'd be a tough landing.
It'd be a crash landing of the economy, which will come.
Because the longer they can prolong things, the worse the crash will be.
Today there was a report out about how bad we had the worst year, up teen years of houses, especially the second day or sale of houses was down dramatically in this past year.
And that is never recorded in these statistics.
There has to be less people working.
They don't get new jobs.
They're working harder if they have two or three jobs.
And I think this helps explain one thing why we hear the lies of the Federal Reserve, the federal government, and bodynomics, and why people don't buy it.
And I always marvel over the fact that when people wake up and they just don't buy any of this stuff anymore.
And when they come out and say, do you know that 80% of the American people don't really believe their government?
Well, that's progress.
I mean, you can't correct it if you don't even think there's a problem.
And so that goes on constantly.
How many lies were told?
And now people are conceding the whole COVID epidemic fear-mongering.
It was all based on lies.
And yet, yes, they've settled down.
People have calmed down a little bit.
But there's also known plans for the next one because they'll come up with another scheme to frighten the people.
So they need to do this and manipulate.
But the healthy thing that's going on is people asking questions, even in foreign policy.
The American people have woke up sooner on Ukraine because it took Vietnam and Korea and the otherwise years in the Middle East.
Oh, we shouldn't be there.
We shouldn't be there.
So now, the American people, the taxpayers say, why are we sending all this over $100 billion to fight Russia and Ukraine, which was a lost fight anyway at the beginning, and much more complex than you read about in the media.
So I think there's, I have to search sometimes for the positive, but one positive, the people have to ask questions about their government.
AI in Healthcare Jobs 00:06:39
And if they don't trust the government, a job equally challenging will be, what are you going to replace it with?
You just can't say, they're a bunch of bums and throw them all out.
You better have a philosophy that will fill it.
That was the magnificence of the founding fathers.
They were sick and tired of taking all that gut from the British, but they had a plan, and it turned out historically to be one of the greatest plans ever.
Chris.
Yes, Dr. Paul.
And yeah, with Peter Schiff and the jobs report, you know, whenever you hear jobs report, that's also a central planning, you know, gimmick.
It assumes that government is the source of jobs in the economy.
They are not, at least not productive jobs.
They can make you dig a ditch and fill it in, but they can't be productive because they don't operate on profit and loss.
They don't operate with people voluntarily giving them money.
They take the money from everybody.
And that's a big difference.
Like this show, we live on our donors.
And if we do a good job, we get more donations.
And that keeps us going.
Government doesn't do that.
They go take whatever they want.
And then the jobs, so-called, that they create is all based on politics.
It's based on votes.
You know, they want to keep their jobs.
So they'll spend money here and quote unquote create jobs here.
But there's no, you know, this is not an economy.
This is all political stuff.
When it comes to jobs, too, our human wants are unlimited.
I could sit here all day long and just name all these lovely things that I would love to have and all these services that I would love to be performed and this and that.
So the potential jobs are theoretically unlimited too.
You know, it's just limited by creativity, efficiency, profitability.
And, you know, today we see a lot of fear out there.
You know, there's always fear, but one of the new ones is that, oh, the AI and robots are going to take all the jobs.
What is everybody going to do?
You know, that's not true.
Like I said, jobs are limited by people's wants.
You have to satisfy people's wants, and wants are unlimited.
So if AI replaces what you have as a job, it frees you up to satisfy another one.
You know, like the horse and buggy, that's gone.
Did those people just die on the spot?
No, they were freed up.
You know, the automobile took care of it, and they were freed up to satisfy other wants.
You know, and that's, you know, you could go through all the things that are now gone.
You know, the people don't just die because their job is gone.
They have to go satisfy other wants.
Here's where the government becomes a problem.
When you lose your job to AI or robot, you have to easily be able to transition somewhere else to satisfy wants.
And that's where the government, it gets in the way, it interferes.
There are barriers to entry.
There's licensing fees.
There's minimum wage.
There's the welfare state.
They have all of these potholes that are in your way and barriers for you to get another job.
And again, this comes down to government has to get out of the way.
So if AI takes your job, you go somewhere else, you get educated, and then you go satisfy someone else's wants.
That's not how people want it to be.
They want the government to interfere, and that's why there's a lot of pain when there's the transition.
Very good.
You know, the part-time jobs and people having two and three jobs, that's part of the distortion.
But there are jobs out there that are considered full-time, and they add to the workforce.
And yet when you look at it, where are these jobs?
Are they, you know, the old days in the first Industrial Revolution, we were making steel and doing all this production and great things were being built.
But if you look around today, it's hard to find something that is being built in a very positive manner.
There's a lot of technology, but that we haven't sorted that out yet on how much of it will be great and how many employers it's going to be.
But the jobs numbers are distorted by hiring people and putting them in government.
The government's getting bigger.
It's bureaucratic.
You need more bureaucrats.
So you hire more and more people.
So government employment, still pretty good, and it's growing and will continue to grow unless we do something about that.
And the other thing is in healthcare.
Well, that's good, wouldn't you say?
Isn't it?
Isn't that a good day?
We have more doctors and nurses taking care of people.
Not necessarily.
When I think of the tragic changes in medicine over COVID, there were a lot more people.
They were laying people off and hiring people there.
And the people who got promoted were the ones who went along with the scenario of the lies that they were telling them by COVID.
But healthcare is also distorted by malinvestment because it's not market determined because it's government.
So the government comes in with all the government wants total control.
I saw some of these ads on TV in the last year begging and pleading, everybody, get into Medicare and Medicaid because the benefits are going to get better and better.
And a lot of people join.
It sounded like a great idea.
So the healthcare industry is growing, but I don't think the quality of medicine is necessarily growing when you have to add into the mistakes made when you're dealing with COVID and dealing with the pharmaceutical industries and when you're dealing with all governments are involved in hospitals one way or other, just like in education.
A lot of malinvestment done in there.
So that to me is something people don't realize that there are jobs out there, but the market wouldn't have created so many jobs as they have now.
Who knows?
We might end up with more homeschoolers and private schools if we didn't have all this government schooling that's supposed to make our nation great and free again.
Let's hope so.
That would be a big positive.
Dr. Paul, I'll finish up by talking about Fed's rescue operations.
And we have to put rescue into quotes when we talk about this.
Viewers of this show know the Fed that should not exist, but it does.
So we have to talk about what it does.
And when they talk about rescue, those who watch the financial news, oh, they're going to pivot.
Rescue Operations: The Artificial Hangover 00:02:55
They're going to lower interest rates again, start printing money again.
What that means is they want to keep an artificial high from wearing off.
They don't want the bad investments to be liquidated.
They want to just paper it over with more money.
But as we see, papering over with more money is driving up prices.
So that's why the Fed is now caught, because if they want to keep this artificial high going, there's going to be inflation on the other side of it.
And I always use this example.
Imagine you're at a bar and you're drinking at an artificial high and one of your friends, he's starting to have his hangover and you're going, quick, quick, quick, get him more drinks.
The hangover is starting.
Well, that's not rescuing your friend.
That's putting him on a bad path because if you keep pumping him full of drinks, he could die with alcohol poisoning.
And you're not going to keep an artificial situation perpetual.
And that's what they try to do with the economy by printing money.
Ultimately, the hangover is going to hit.
And since it's been so long since we've had a hangover and they've distorted things so much, it's going to be bad.
And it's too late.
There's nothing we can do about it now other than dealing with it rationally when it happens.
So that's what is ahead of us.
That's what is ahead for the Fed.
They're going to have a big PR problem someday.
And that's a good thing.
Very good.
I want to quote a little bit from an article written by Simon Black, who's also known as the sovereign man and also a friend of liberty and a clear understander of Austrian free market economics.
But he's sounding the alarm.
It's not like nobody else has ever done it, but he does it with clarity and he's done it often and he's emphasizing and there are some numbers now that become more scary all the time because he's put some dates to it now on what's happening.
First he starts off by saying that there's a coming debt increase according to our Congressional Budget Office of $20 trillion.
It's built into the system, automatic increases, which they're admitting to.
And the one thing I would say, they're going to err on being underestimating.
There's just a lot, automatic $20 trillion of debt coming into the system.
But he emphasizes the issue of 2033 that at that time, that date is when we no longer will have any cash in the Social Security system.
So right now, Social Security is a so-called benefit because they don't have to use every penny with the cash flow, young people working and all, and how the costs go out.
Changing Course on Government Expansion 00:04:46
So they have that to deal with, but they've done this, and yet they're going to run out of cash.
They've always had a kiddie there that they could take money out, and that helped them with the so-called paper debt and the deficits going in.
So what he's saying is that $20 trillion, which is automatically built into the system, is also going to meet up with the bankruptcy of the Social Security system.
And this, again, is going to add many, many trillions of dollars.
And there's this prediction, you know, Simon emphasizes it in 2033, which if we make it that far, it's going to be bad.
But I sort of think that nothing prevents it from coming sooner because we can't control expenditures.
We can't control the price inflation levels.
We can't control, you know, how many wars we'll be in.
There's so many variables.
But if it was just clean arithmetic, it's bad news that the budget is automatically going to go up and then it's going to collide with the point in 2033 where there's no more money to tide us over in our budget by taking away from the so-called fund, you know, the fund that's holding our Social Security money and make sure everybody's taken care of at their old age.
So that is another one.
So those problems are there.
And the only thing I can see that's going to help is an entire change in an attitude about the role of government.
Government can't be involved in the details of all education throughout the states.
They can't be in charge of the medical system.
We can't be in charge of our empire around the world.
We can't allow the medical industry to be controlled by the pharmaceutical industries.
We can't let the military-industrial complex run the show.
And we're on a collision course.
I don't think, quite frankly, that if we don't change quickly, and some people believe there will be changes after the election, that we have to have significant changes prior to that time because it's unpredictable.
But it will come and it won't be easy.
So even if the individuals in there are determined, cutting back is not very popular.
Well, when the market cuts it back and you lose purchasing power or you lose your job, you can blame somebody else.
But if Congress comes along and say, well, we cave in, and the Democrats say, oh, yeah, those Republicans, those few Republicans who argue, they're right, we have to cut.
We have to cut.
We have to bring our troops home.
We're changing our foreign policy.
Tell you what, it wouldn't be easy.
But the argument to answer that, if you did the right thing, yes, it would cause some problems.
But compared to the problems that we're going to have if we don't straighten out this mess and change our attitude about perpetually expanding the size and scope of government and giving up on the initiative to understand why the government's purpose should be to protect liberty and understand liberty.
Instead of running the biggest fiat monetary system in the history of mankind, maybe it should be in charge of teaching people what sound money is all about and reference maybe even the founders who had some strong ideas about money.
And I'm also convinced that if people understand what's coming and they will tolerate more on what has to be done, but if they are fibbed to, like statistics and all this, and why we have to be in the Middle East and you're still in Iraq and still in Syria, all this stuff, if they don't hear the truth, all it's going to be is more distortion.
But if they hear the truth, they might be able to accept the ideas of, you know, tighten our belts.
That's what you have to do if somebody is very sick and needs a serious operation.
They know they have to go through something and it could be painful.
You have to have this operation.
The society is a little bit more difficult and the people don't want pain and suffering.
They want a free lunch and that will have to change.
And you say, well, why do it if it's going to cause some problems and the people are going to be upset?
Because what is coming would be a lot worse.
Freedom is an answer to a lot of our problems.
People have to be convinced that the founders are on the correct path, that having a constitutional republic is far superior than having what we have today.
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