Note to Fed: The Laws of Math Still Apply |
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John Rubino, Patrick Highsmith and Chen Lin return as guests on this week’s program.
The big Keynesian fantasy that a country can forever become wealthy by consuming more than it produces has seemed believable to Americans because we have owned the world’s fiat reserve currency. That meant for the past number of decades that the Federal Reserve could create fiat money out of thin air to enable Americans to buy foreign goods rather than Americans earning income through export sales to pay for their consumption. But alas, the Federal Reserve and America cannot defy the law of mathematics because money isn’t actually created out of thin air at all. Fiat money is manufactured with debt.
So, as decade after decade, America continued to consume more than it produced, its debt relative to income has risen to the point where the U.S. is now insolvent. Because of excessive unearned money creation by the Fed, America is now facing double-digit levels of inflation akin to 1980. But unlike 1980, when a 20% Fed Funds interest rate was required to break the back of a double-digit inflation rate, America’s debt load is so large that not even a ¼ of 1% Fed Funds rate, or a 2% 10-year Treasury rate, can occur without triggering the next stock market crash and U.S. recession. With the entire American economy now dependent on rising stock prices rather than rising GDP, the only likely option for the Fed is to continue with the money-creating Keynesian fantasy leading to hyperinflation and very possibly a global currency reset. John will opine on America’s precarious economic state and how we should prepare for what is to come.
Patrick will update us on the exciting prospects for Firefox Gold’s exploration project in Finland and Chen will share his thoughts on the emerging precious metals markets and his top biotech ideas. |
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John Rubino runs the popular financial website DollarCollapse.com. He is co-author, with GoldMoney’s James Turk, of The Money Bubble: What To Do Before It Pops, and author of Clean Money: Picking Winners in the Green-Tech Boom (Wiley, 2008), The Collapse of the Dollar (also with James Turk), How to Profit from the Coming Real Estate Bust (Rodale, 2003) and Main Street, Not Wall Street (Morrow, 1998). After earning a Finance MBA from New York University, he spent the 1980s on Wall Street, as a Eurodollar trader, equity analyst and junk bond analyst. During the 1990s he was a featured columnist with TheStreet.com and a frequent contributor to Individual Investor, Online Investor, and Consumers Digest, among many other publications. |
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Patrick Highsmith is Chairman of Firefox Gold Corp. A professional geologist and mining executive with 29 years of experience in exploration, operations, business development & leadership roles for companies, including: Rio Tinto, BHP Billiton, Newmont, Lithium One, Pure Energy Minerals, and Fortescue Metals Group. Mr. Highsmith has worked on more than 250 projects around the world, leading teams through creative transactions, new discoveries, scoping, and prefeasibility studies. He is experienced in the capital markets, having been associated with all manner of financings and transactions. Patrick has been targeting gold in Finland since 2005, and has been integral in building FireFox. He is also the Pres. & CEO of Timberline Resources, a mineral exploration and resource development company focused on gold and copper discoveries in north-central Nevada, USA. |
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Chen Lin had been a doctoral candidate in aeronautical engineering at Princeton. However, Chen found his investment strategies were so profitable that he put his Ph.D. on the back burner to devote full time to private investing and writing a newsletter titled “What is Chen Buying? What is Chen Selling?” Chen's track record has been phenomenal! In one account we tracked, in which he used no leverage, he was able to grow $5,411 starting in 2002 to over $2.2 million by the end of 2012. You can visit his website at http://chenpicks.com |
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Jay Taylor Taylor Hard Money Advisors, Inc 718-457-1426 |
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