Simone Wapler – La Chronique Agora (France) –
The debt grows, the doubts too. But who will pay at the end of the ends? There is no miracle; fake money does not buy real prosperity. Many things uninteresting in the news of this morning: re-election of Angela Merkel, fall of the real estate developers in China, rise of oil above $ 50 a barrel, the budget of France … This allows us to focus on more interesting topics that directly affect us.
Bill Bonner is interested in the foreseeable effects of “normalization” announced by the Fed. When the biggest buyer becomes the biggest seller, a market turnaround is to be expected. Except that the Fed will not let such a turnaround occur and will turn on board immediately. Still more debt, more and more money will be dumped. In the United States, Europe, China, Japan … Our destiny is to die stifled under the debt. I dedicate this chronicle of the day to JLM who posed this very simple question: ” Something I have a hard time understanding: all countries are in debt.
But to WHO do they owe this money? ” I could cite thousands of pages of abstruse documents from the Bank for International Settlements, the International Monetary Fund, the European Central Bank, the Fed and various institutes and think tanks . Today, for example, Les Echos tells us that Ireland is the third largest creditor in the United States, behind China and Japan. This is unnecessary information.
Les Echos speaks without laughter of “war treasure” explaining that large companies store treasury treasury bills. Why do these companies not invest it, why do they not pay their shareholders or their employees better if they have no idea for the future? Not to pay tax. A portion of the US debt, for example, would be due to shareholders of companies that do not want to pay taxes. For policies, public debt will never be paid For successive governments, the liability does not have to be repaid. It is enough to “roll” the debt: when an old loan matures, one emits another.
As central banks cause interest rates to decline, the operation is not only painless but profitable. The disregard for the liabilities is such that certain countries (Argentina, Australia, Austria …) do not hesitate to raise debt at 100 years. Borrower and lender are equally irresponsible. The two people who made the decision – one to lend, the other to borrow – will disappear when the accounts are cleared. This proves to us that capital does not count for those people who never have an account to render.
The naïve tale of the clearing of public debts For the naive, since everyone is in debt, everyone is standing by the goatee. Just do the clearing and the deal is settled. The naive are mostly in the borrowers’ camp, those who have never had to make money and live on “the money of others,” that is, the taxpayer. This idyllic tale is silly. Imagine that we are going to arrange with our foreign creditors (who hold about 40% of the French debt) one by one?
Some are in the private sector, others in the public sector. If we do not pay them, they will not lend us anymore and because our government is unable to live without a chronic deficit, it is simply impossible. Finally, it is better to remain simple without being naive. Experience has taught me a universal financial rule: when you do not know who pays, do not seek, it is you. Politicians will prefer to steal savers rather than default on overseas debt. Debt = tax not deducted = tax stock At debit, public debt, must match a credit, creating wealth through profitable economic activity.
It is a completely different system from honest capitalism that engages only the money already created and saved. In the system of honest capitalism, a bad investment destroys only the money of the past, saving. As Bill Bonner points out, our system works on credit and not on wealth. Total debt now exceeds $ 230,000 billion. “As world production is not enough to cover these debts – not to mention promises made to future retirees – it will have to be somehow offset either by bankruptcy (deflation) or by printing even more money (inflation). ” You, we, are going to pay twice.
Once by a drain on our savings then a second time by inflation. When France can no longer assume the interest of its debt vis-à-vis foreign creditors, the tax authorities will come first to use the existing savings. You will see the Loi Sapin activate in case of crisis on the French debt. For the remaining liabilities, either it will be eroded by inflation, the ECB doing “all that is necessary”, or it will require a mixture of taxation and denial of promises (everything that is “guaranteed by the state” in terms of retirement and health). This is to not get you trapped as well as we advise you to have a share of your liquid savings in gold form.
But do you know what is the physical gold you should buy? This piece has very special characteristics that enable it to escape legally from any taxation. Discover it here. The problem of credibility is that it does not just destroy the money of the past, it also destroys the one that does not exist and must be created. It destroys the future. It is the price to pay for having believed in artificial money, the “redistribution” of what did not yet exist.