I rarely urge my readers to do anything but in this case I am jumping up and down and waving my arms by way of encouragement - particularly if you are one of my American readers. What I want you to do, is settle down in a comfy chair with a cup of good coffee - and a very large Scotch - and spend an hour listening to a man with a tale to tell. He is American and also a businessman so, as you will have guessed, there is a sales pitch but happily that is kept to the very end and may be avoided if so desired. However, it is the first 50 minutes or so that is riveting and in which he describes exactly and precisely why the USA is rapidly approaching a major catastrophe that will dwarf the recent bank collapses.
It is, or should be, of major concern to us 'over here' because, as the old saying has it, 'if they sniff we catch a cold'. However, it seems almost inevitable that this time they are going down not with a sniff but with double pneumonia! The warning comes in the form of an audio presentation so all you have to do is listen - and gulp at your Scotch. The central premise is simple. The American government is printing dollars at eye-watering levels never before seen in their history. They are doing this in the confident knowledge that because the dollar is the world's reserve currency used by nations everywhere to conduct their business, there will be no ill effects from this money-printing exercise because the dollar will be in constant demand. Any minute now they, the American government, are about to find out that the dollar has ceased to be a reserve currency for the simple reason that nobody trusts it any more. When that happens you can say goodbye, America and hello, Zimbabwe!
The effects of a total crash in the value of the dollar on a heavily-armed American society facing an even more heavily-armed government do not bear thinking about. The gentleman giving the presentation has not convinced me of anything new because I have long festered on my suspicion that American national debt is unsustainable - and today, and for the foreseeable future, that debt can and will only get bigger. I hasten to add that this is not entirely the fault of the Obama administration, they are simply the last in a long line of 'spendaholic' governments. By the time Obama leaves office, most experts reckon the debt will have reached $20 trillion. There are many people in his administration who will be delighted at that state of affairs and look forward with revolutionary fervour to a breakdown in civic society when the bloated chickens come home to roost.
Already China is discreetly easing itself out of dollar holdings. They are doing it slowly because they hold too much to want to cause a panic. However what they, and many other nations are doing, is to set up currency agreements which will allow the participants to do their business in currencies other than the dollar. This alone will be enough to gradually devalue the dollar as you can see from this 10 year chart, courtesy of www.tradingeconomics:
Just look where it was ten years ago and where it is today. Think of it in reverse, like the water rising slowly and inexorably up inside the SS Titanic! It is in the nature of these things that it is only at the last minute that suddenly the water rushes in and the ship turns turtle in minutes. As for my own poor 'septic Isle' I would like to think that the great minds at work in our Treasury under the guidance of our very own wise and shrewd Chancellor of the Exchequer(!) are already surreptitiously getting out of the dollar, of which they own about 135 billion, and setting our nation up ready for the coming financial apocalypse - but I don't because they ain't!
Please do give it a listen:
I am grateful to PJ Media for the link