The Collapse of the Monetary System - a Comedy of Errors• by Martin Armstrong
QUESTION: Dear Martin
Could you please describe more in detail what you are expecting when talking about the breakdown of the monetary system?
Will there be differencies between countries like Germany and Switzerland for example? Especially regarding pension systems.
I asume, there might be big differences by countries.
Many thanks and best regards,
ANSWER: The collapse of the monetary system is the result of a comedy of errors. It boils down to the problem that governments since World War II have adopted Keynesian Economics whereby they took Keynes' suggestion that they should run a deficit during a recession/depression to compensate for the fall in demand because people are hoarding their cash in times of uncertainty. The problem was that they merged that with Marxism and began to run deficits annually and then took the Quantity Theory of Money that claimed an increase in the money supply would be inflationary. So, they borrowed rather than printed falsely believing that they could spend whatever they wanted without it being inflationary.
However, because debt suddenly became collateral post-1971 when it had been illegal to use government bonds as collateral for borrowing, then the debt was transformed into money that now paid interest as it had begun during the American Civil War.