Debt money - An introduction to my economic theory

A month ago, in a small Discord chat room with a few friends, I wrote another iteration of how I understand economics, which is not quite like anything you can read in a book or learn in a class.

The Major Event of the day is the Corona Virus Scamdemic.

Like most “Major Events”, this one also seems to be serving various purposes for, and presenting various dangers and opportunities to, various peoples, weak and powerful.

We are also coming to the end of the Petro-Dollar and may well have just passed Peak Oil.

A key aspect of the current Corona Virus Scamdemic is the more or less global lockdown and shutdown, collapsing economic activity dramatically world-wide. Global oil shipments have collapsed to half their usual volume, and the price for crude has collapsed to a quarter its usual price. The combination of those two “black swans” has collapsed the “cash flow” of Petro-Dollars through the global oil market to one eighth of "normal (1/2 times 1/4 is 1/8). Actually, less than one eighth, as some of the Petro market has moved out of the US Petro-Dollar into Iranian, Chinese, Russian and other currencies.

Much of the world’s debt, of corporations and governments, large and small, is denominated in Dollars. This means that thousands of “entities”, owing hundreds of trillions of dollars of debt are desperate to make debt payments, as their “cash flow” (US Dollars of current revenue, taxes or other income) has collapsed.

This all amounts to an epic shift in

  • the world’s dominate empire (which has been the US and the Anglo-American empire),
  • the world’s dominate currency (which has been the US Petro-Dollar),
  • the world’s primary energy source, which has been petroleum for the last century,
  • the world’s level of technological integration (undergoing massive upgrades), and
  • likely, the extent to which our civilization goes off planet for critical mineral resources.

The world’s most powerful (and less powerful) are frantically jockeying for position in this truly epic transformation of our civilization.

The economic and monetary theories that I read in books or learn in classes or listen to in Youtube videos simply can’t handle this level of change.

In the next few posts of this topic, I will (more or less) copy and paste a few comments that I made last month in a private chat with some friends, as I continue to think through what this means and how to best explain it.

Welcome to a strange, half-baked (if that) theory of economics and money that will never earn you a single Dollar in the labor market or a single credit in a college course. At best they could earn you a look of confusion and disapproval from a friend, if you try to relay “this theory” (“these fragmentary speculations”).

If I am most fortunate, then something below will spark some interest and creative spark in another, who might choose to join in the sort of discussion that is needed, like water to a seed, to germinate this seed of a thought and “find out what’s in it” (as Nancy Pelosi famously said of the Obamacare health bill.)

04/09/2020
The Fed now owns the most valuable resource on the planet. It’s not a bottomless oil well, or a bazillion tons of gold. It’s the master printing press for the currency in which most of the debt in the world is directly or indirectly denominated.

04/09/2020
Ah - notice that the main source of Rockefeller wealth, at least in the last century, was oil. Oil as the primary source of energy for our civilization seems to be in a major, long term, perhaps permanent decline. The amount of money flowing through Saudi Arabia and other OPEC nations has fallen precipitiously (from the usual $50 to $80 per barrel for WTI crude to $20 to $22 per barrel), with the fall of the price of oil, and the declining volumes of shipment. As I noted at length above, the Petro Dollar just died, replaced at the moment (though not for long) by the Debt Dollar … the Dollar being needed to keep making payments on debts, world wide, in the hundreds of trillions. The “Century of the Rockefellers” seems to be coming to an end. They are increasingly unable to hide their evil from public view.

4/10/2020
The “Debt Dollar” (where desperate efforts to make payments on US Dollar denominated debts, world-wide, are a far more powerful “pump” to keep Dollars moving than is the now (perhaps forever) weakened petro business that “energized” the Petro-Dollar for the last half century) will only last as long as there are many such desperate Dollar Debt repayment efforts. Once enough bankruptices, defaults, collapses and such have occurred, then the Dollar Debt Payment Pump will collapse, becoming much weaker, and we’ll get to see what the next world monetary system pump is (most likely preceded by some nasty inflation, in order to “prepare” us to accept the new monetary system.) Here’s an early, rather predictable, debt collapse becoming public: https://money.usnews.com/investing/news/articles/2020-04-09/exclusive-us-banks-prepare-to-seize-energy-assets-as-shale-boom-goes-bust U.S. Banks Prepare to Seize Energy Assets as Shale Boom Goes Bust

4/11/2020
In the following article, and in the following Youtube interview, a macro economic analyst and financial trader whom I had never heard of until today, Lyn Alden, does a far more articulate and expert job of explaining the “Debt Dollar” idea that I concocted above.

The “Petro Dollar” (world needs US Dollars to purchase Petro, thanks in part to near monopoly control over the currency used to purchase Petro) is now becoming the “Debt Dollar” (world desperately needs US Dollars to pay off vast amounts of US Dollar denominated debt).

I recommend listening to, or reading, as you prefer, Lyn Alden’s explanation of this, if you have any interest in this subject.

The Global Dollar Short Squeeze

4/17/2020
Above I wrote << what will likely be the world-wide, central bank created and supported, cryptocurrenc(y,ies) of our future monetary system. >>. In my estimation this is the primary goal of the current coronavirus epidemic narrative. This scamdemic narrative is being used to strangle current cash flows and balance sheets, so that a new cash flow can be introduced and widely welcomed, coming from central bank created and managed “blockchains” (as they might be called, but aren’t really). These “Fed coins” and such will be the new base monetary unit, replacing the coins of gold we used for the last few thousand years (with a 50 year interregnum using US Dollar denominated units of US Treasury debt).

4/18/2020
The Petro-Dollar is dead (or at least in a deep coma). Both oil demand, and oil price, have dropped about 50%, so their product, the Dollars spend for Oil, world-wide, has dropped to the product of vol*price == 1/2 * 1/2 == 1/4. That’s one quarter of the US Dollars being spent for oil, world-wide, over the last couple of months. Long live (well, for a few months anyway) the US Dollar denominated Debt-Dollar. https://www.youtube.com/watch?v=mM1feieDoEw (Actually, it’s not just global Dollar denominated debt that’s putting a giant, circa 10 trillion dollar, short squeeze on the Dollar. It’s also another circa 10 trillion Dollars of currency swaps involving the US Dollar. It’s the biggest short squeeze in recorded history.)

4/21/2020
Another writer that I have long enjoyed reading, but that our Mentor Emeritus Bill Ryan has warned us against, Miles Mathis, has a guest authored article exploring the Coronavirus COVID-19 history and statistics. Bottom line: it’s a big time scam, riddled with lies: http://mileswmathis.com/covid.pdf

4/21/2020
I didn’t see much that was new to me in the above article. It was a nice presentation, in a few pages, with links and references, of some of the many flaws and lies in this Scamdemic. Miles adds a Postscript, concluding:

is manufactured from the ground up. What I would
like to see next from a guest writer is an analysis
of the financial side of this, looking closely at
the Gates Foundation, Blackrock, the fake stimulus
package, and huge loans being forced on all of us
right now, via the Fed raising the debt ceiling by
an awesome amount.

I think this is the biggest treasury theft in the
history of the world, though that side of it is
getting little attention. They are sending you a
check for $1200 while picking your pocket for 50
times that. Or is it a hundred? Or is it five
hundred?  Only time will tell.

About every ten years now they come back with
an even more colossal scam. It started with 911,
the greatest theft and scam of all time up to
that point. Then we had the bailouts, which
were an even bigger theft from the treasury.

Since the American people did absolutely nothing
about either theft, the thieves returned for a
third time this year, and they will keep coming
back until they are stopped.

I guarantee you the next theft will be even larger.
This is how it works. They will keep robbing you
until there is literally nothing left to take.
You wont be left alone until you are living in a
cave sucking on cold potatoes.

4/21/2020
I would go further than Miles in speculating what are the real motives of the elite bastards running this Scamdemic. I think that this particular Scamdemic is more than just stealing hundreds of trillions, instead of the mere tens of trillions stolen in the 2008 bailouts.

I think that this particular Scamdemic will morph into a global economic depression, in order to “soften us up” for a global economic/financial/monetary reset.

For the last 70+ years, the US Dollar has been the world’s “Reserve Currency”, as it has been the primary monetary unit used to:
(1) purchase oil, our main energy resource,
(2) settle international trade imbalances, and
(3) settle international debts.

This is ending. The world’s monetary system is being setup for a major reset.

Oil trading volumes are 1/2 their usual volume (due to the economic shutdown), and oil prices are now 1/4 their average prices. Combined this means that the world-wide demand for Dollars to buy oil is 1/2 times 1/4 == 1/8 (one-eighth) what it has averaged for the last 70 years. The “Petro-Dollar” dynamics no longer power the US Dollar.

The role of the US Dollar to settle trade imbalances is also being devastated, due to collapsing international trade and increasing trade outside the Dollar regime.

The role of the US Dollar to settle international debts is also being strangled, not due to any lack of debts needing payment (such debts are at the highest level in recorded human history, ever, by a wide margin), but rather due to a shortage of Dollars to meet payment schedules. Thus, US Dollar denominated debts will be extinguished or converted in the near future (year or three, I’d guess), by one of:
(1) debtor bankruptcy, forfeiting the collateral,
(2) lendor forgiveness, writeoffs or collapse,
(3) in due time, inflating away the US Dollar value of remaining debt, or
(4) conversion to some new US central bank managed digital cryptocurrency unit.

4/21/2020
.
Then, impoverished and hungry, “we”, the non-elite people, businesses and governments, will be “softened up”, and welcome a central bank managed "digital cryptocurrency" as our new world “reserve currency”, for energy, trade, and debt.

Thus will every monetary transaction, world-wide, from a small allowance to one’s young child, to the buying and selling of nations, be subject to the real time surveillance and control of the central bankers, whom I trust to serve the interests of their elite bastard masters, not humanity.

They aren’t just stealing some hundreds of trillions of Dollars. They are dead set on stealing human civilization.

This Corona Scamdemic is just the opening act, used to distract and scare us all, and to cram the economic depression down our throats that is needed to set us up to welcome the global monetary reset that will be the foundation of our global enslavement.

Keep your pantry well stocked, and your cash flow requirements lean.

Keep informed, and resist as best you can.

Vive la résistance!

4/22/2020
It would not surprise me to see the US be the strongest player on the economic, financial, monetary world stage, over the coming year, as Europe, China, the Middle East, other OPEC members, and some smaller nations, have major financial collapses.

If [a US banker friend of a friend of mine] is mostly US centric, then he may well be correct in sensing the relative strength of the US. Certainly right now, the biggest problem that the rest of the world has is the “strength” (dire shortage) of US Dollars, to handle their trade and debt payments, and currency swap margin calls.

The US is like a slum lord crack dealer, who has built a large “customer base” of addicts. So long as he keeps the incoming supply of crack below (but not too far below) what’s wanted, he has his “customers” in a short leash. The US Dollar is the crack in this analogy, and some combination of NYFed, USTreasury, BlackRock, JPMorgan, Goldman, EtAl … are the slum lord’s agents

What I don’t know yet is who is the slum lord boss, sitting in the big seat, working through his above more visible agents.

The above several posts were originally written last month, in a small Discord chat channel with a few friends.

I now return to writing in real time, posting as I write.

==

Lyn Alden, who I quoted and praised above, continues to present a clear, coherent, sensible analysis of our (primarily the U.S.) current monetary situation. See for example her recent long article Quantitative Easing, MMT, and Inflation/Deflation: A Primer. This article does a most excellent job of presenting some of the best available analysis of the current monetary, financial and economic situation of the United States and the world we find ourselves in.

She’s a very well informed financial analyst, and writes clearly and cogently.

===

There are two ways in which I anticipate that Lyn Alden’s above analysis (and the analysis of many who share her views) will be found woefully inadequate, in the light of hind sight, in another decade or two.

Fundamental issue number one (big changes):

Some major, civilization impacting, changes are afoot, which she does not consider.

As I wrote above:

Fundamental issue number two (they own it all):

To paraphrase the words of Gregory Mannarino (Website, Youtube channel): They will “own it all.” The key to that observation is who “they” are.

Gregory is referring, on the surface at lest, to the Federal Reserve. This much is quite consistent with the above analysis of Lyn Alden.

The Fed, as co-owner with the US Treasury of the US Dollar “printing press”, is buying the world’s stocks, bonds, derivatives, swaps and currencies, hand over fist, at the rate of a trillion dollars every few months (or perhaps at a higher rate that they aren’t telling us about.)

But who “owns” the Fed?

Well, basically it’s the “banksters”, such as a few big London and New York banks, who are the financial and monetary agents of whoever are the elite bastards (as I like to call them) who apparently have been running the show down here on planet earth for at least the last millenia or two.

Since “recorded history” is a tale told by other complicit agents of the same elite bastards, therefore “history” is but a tale full of sound and fury, signifying nothing (Shakespeare | Macbeth | Act 5, Scene 5), so it’s hard to say reliably just how long these elite bastards have been so powerful, or even just who they are.

Be that as it may, I can’t help but wonder:

  • What will be the consequences of the elite bastards, through their bankster agents, having a direct, controlling, legal interest in essentially all the major nations and corporations on the planet,
  • and of the same elite bastards apparently acquiring deep and pervasive surveillance into and control over the lives of most of humanity, around the planet,
  • just as such far reaching and deeply impactful changes are unfolding?

In my increasingly rare optimistic moments, I figure that the problems with the above “Fundamental issue number two (they own it all)” will enable the opportunities of the above “Fundamental issue number one (big changes)” to unfold more expeditiously.

Indeed, the elite bastards, in their far seeing vision, may have realized that they need to take more direct control of all the major institutions and populations of this civilization, in order to more reliably bring about the major changes in the above “Fundamental issue number one (big changes)”.

Regardless, whether it plays out well for future generations or not, I think that the afore mentioned Lyn Alden has tunnel vision. She’s writing from within the world in which the Anglo-American empire, especially the United States and the Petro-Dollar, has been dominant her entire life.

Summary:

I’ll try to speak more directly.

I anticipate that humongous changes in our civilizations primary energy and technology will unfold over just the next few decades.

This will change our civilization and our daily lives as much as the combination of wind propelled ocean going wooden ships, navigated using the compass and chronometer, changed our civilization in the half millennium from about 1400 to 1900 … or as much as oil fired, steel hulled ships navigating using GPS changed our civilization in the most recent century, 1900 to 2000.

The immense increases in computational and communication technologies of the last few decades will accelerate the rate at which the next round of material, energy, propulsion, manufacturing and population control technologies are refined and applied. What took five hundred years in 1400, or one hundred years in 1900, might take a decade in 2020.

The economic, financial and monetary models of even the most well spoken experts such as the above Lyn Alden will struggle to keep up with these changes.

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Wow Paul!!! You have been posting on this thread since April! I love it!

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Combine:

(1) what the Dark Journalist has been saying for sometime now, such as in the first video below, about a “time capsule” that Nixon left in the White House, and the Trump family’s connections with Tesla and Nixon,

(2) what Jim Willie says in the second video below about US Naval Intelligence having been developing major technology advances, since at least the Roswell, New Mexico “weather balloon” crash in 1947,

(3) the possibility that US Naval Intelligence has been a key supporter of Trump (clearly Trump has some deep state intelligence support), and

(4) my speculations that we’ll soon be seeing more of whatever plasma-electromagnetic-fusion-freeenergy-whatever energy technology will replace petroleum

and you get a pretty good case that:

(1) there will be a major rebirth of industry and technology in the US, clearly underway within say a couple of years, that may well change our civilization for centuries to come,

(2) a multipolar world, including the US, Russia, China, Japan, Korea, Germany, Persia and other nations in major roles,

(3) competing state-sponsored cryptocurrencies denominating major international trade, contracts and lending, as the replacement for the US Petro-Dollar (which is on its death bed),

(4) silver playing a key role in the construction of these new energy devices,

(5) extensive, publicly visible, mining and “off-planet” exploration,

(6) where Trump has been and is well aware of these potential technologies, and agreed to take the job of US President with the expectation of leading the US through the transition into these new technologies, which will have major impacts on our laws, economy, industry, and living in general.

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I can “see” all that, Mooster.

Just to note: The Bush family was heavily “never Trump” as many here likely know. Yet there was/is a single, notable exception to this.

George Prescott Bush

Military service

On March 21, 2007, the United States Navy Reserve announced the selection of Bush for training as an intelligence officer through the direct commission officer program, a Navy initiative whereby applicants in specialized civilian fields forgo the typical prerequisites of a commission, such as the Naval Academy, NROTC or OCS, and – instead – attend three weeks of Direct Commissioned Officer Indoctrination Course (DCOIC) classes on subjects such as naval history, customs and courtesies, followed by online classes.

Bush told The Politico that attending the October 2006 launch of the aircraft carrier named for his grandfather – the USS George H.W. Bush – inspired him to join the service. He also called the death of Pat Tillman, the NFL player and Army Ranger who was killed in a friendly fire incident in Afghanistan in 2004, “a wake-up call”. Bush served in Operation Enduring Freedom for eight months and returned to the United States in 2011. During that deployment, he was given a different name for security purposes. Not even those he was serving alongside knew his real identity. Bush left the U.S. Navy Reserve on May 9, 2017 at the rank of Lieutenant. [emphasis in bold was mine]

I’d forgotten that … good point.

Still, I don’t see Trump going after the Bush’s for their crimes (including a cameo role in 9/11, reading to a third grade class), the way that Trump is going after the Obama/Clinton/… crowd.

It seems (from this distance) as if the Trump’s and Bush’s have a truce, unlike with the Obama/Clinton crowd, which is an ongoing hot war.

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