Category Supply and demand

Feb 2 2023

Gold v Digital Fiat & Marxism


Armstrong Economics Blog/Gold Re-Posted Feb 2, 2023 by Martin Armstrong

QUESTION: Hi AE…so gov’t “money” (fiat currency) will become just some abstract floating measurement of value, an electronic entry in an electronic account in the cybersphere. As these various so-called gov’ts become less reliable, even between themselves, do you see the possibility of them simply skipping their phony currencies, & trading directly in gold. Russia could ship a specific quantity of crude to China, for a specific amount of gold bars. Your argument about the impracticality of a gold-backed currency makes sense, but what about large transactions being settled in gold?

HS

ANSWER: The entire problem that people do not grasp with regard to any return to a gold standard is that if the money supply is FIXED in any way, that necessitates the collapse of SOCIALISM. The two are directly linked. Politicians only know how to run with deficits. Vote for me and I will give you this or that!

The Bretton Woods gold standard collapsed because they FIXED the price of gold at $35, but they continued to print money far beyond the supply of gold at that fixed price. In addition, you have a business cycle. There will be times when no matter what the money might be, there will be boom times when the value of money declines and the asset values rise.

This argument over gold v fiat is absolutely just nonsense. The wealth of any nation is the productive capacity of its people. For centuries, the business cycle has existed and that is the entire cause for the “inflation” in assets when money declines in value, and then the “deflation” in assets with the value of money rises. Arguing over what we use for money will NEVER stop the business cycle.

The cycle is also in part driven by all governments. It becomes a drug of power that is abused. It would not matter what we use for money right now, they want to create World War III so they can default, and escape from the abuse of this Marxism that they have turned into a system of borrowing every year with no intention of paying anything back. But we have reached the confrontation between Keynesianism where central banks are expected to prevent inflation by rising interest rates, but that has no impact on the government which has become the biggest borrower in the system.

We are going BUST not because of the money we use, but because of the abuse of power in government which has always existed since ancient times.

Trust me. Forget gold standards. They will never work because all governments act only in their own self-interest. You should have learned that with COVID. They will never admit any mistake EVER! It is far better to keep gold on our side of the table and we can then use it as a hedge against governments. They are seeking to move to digital currencies ONLY so they can track when you hired the 16-year-old girl next door to babysit for you so they can go after her for the government’s 50% share.

Even Bitcoin is fiat. There is no backing. People have dived headfirst into cryptocurrency on the entire proposition that they are limited. All they have done is proven my point. Money, historically, has been everything from seashells and cattle to bronze, silver, and gold. Of all the various forms of money, only bronze and cattle had any real commodity value based on utility.

The Egyptians really invented paper money for the farmers would deposit their grain and receive a receipt which was a bearer instrument used in trade. They also used raw metal, not coins, and traded based on weight, as it stated in the Bible. Here is a piece of pottery from Egypt recording a complaint about taxes written in Greek. It stated the sum amounted to a total of 90 talents of silver with 15 talents of tax on the transfer of land – 16.6%.

For thousands of years, Egypt had no coins until it was conquered by Alexander the Great, and upon his death, his general Ptolemy I (305/304 – 282 BC) took the throne and it was his Greek line from which Cleopatra VIII came – not Egyptian.

Our system is starting to implode. Never in the history of human civilization have governments demanded taxes on income requiring reporting every year. This was the gift of Karl Marx. Just as this Egyptian tax on the transfer of land, we see that property taxes and a form of sales tax were the norms.

The American Constitution was intended to give thenational government greater power to raise revenue because the previous Articles of Confederation had been a fiscal disaster. Nevertheless, most people remained fearful of taxation by governments. Indirect taxes were to be the way to secure our liberty from tyrannical governments. It was generally understood that indirect taxes meant taxes on consumption like a retail sales tax and/or excise taxes on imports. It was believed that indirect taxes did not lend themselves to abuse by tyrannical governments. Consequently, the general belief was that “direct taxes” has to be taken off the table. Incomes taxes, throwing out the window of all the wisdom of the ages, were imposed by the new age of Marxism in 1913.

Our computer warns that 2025 will be the turning point in Marxism.

Feb 2 2023

Interest Rates & the Fed


Armstrong Economics Blog/Interest Rates Re-Posted Feb 2, 2023 by Martin Armstrong

The Federal Reserve raised the benchmark by 25 bps, as expected. The Fed fully understands that the manipulation of the CPI is a necessary aspect both for containing government benefits and understating inflation also results in high tax revenues. The market loves hope, and as a result, they focused on the warning that we’ll be in restrictive territory for just a bit longer. Most still believe that there will be a slowdown in inflation just ahead.

The Fed’s cautionary commentary saying that the “disinflation process” has started triggered shares to jump ending up 1%. This shows how insane the analysis had become that they cheer a recession and think that lower interest rates are bullish for the stock market. Obviously, they just listen to the talking heads on TV and have never bothered to look at reality. When interest rates decline, so has the stock market. Interest rates rose for the entire Trump Rally, and they crashed during the Great Recession of 2007-2009. For the life of me, I just shake my head when the talking heads cheer lower rates and spread doom and gloom with higher rates.

Feb 1 2023

Biden Continues Playing Politics with COVID Emergency – House Votes to End it, Senate will Ignore


Posted originally on the CTH on January 31, 2023 | Sundance

On the literal eve of a House vote to end the COVID emergency through legislation, the White House announced they would end the COVID-19 Emergency Declaration on May 11th. [pdf here]

The managers of Biden knew they would face a bipartisan vote to end the power of the dictatorial fiat known as the COVID emergency, so they quickly rushed to give Democrats in congress cover for voting against the legislative end.

In the end this is all a matter of pure politics and posturing for narrative control, because the Democrat controlled Senate is not going to take up the House bills.

WASHINGTON DC – […] The two bills – the Pandemic is Over Act and the Freedom for Health Care Workers Act – were planned by Republicans last week; and late Monday, the White House announced that it will terminate the national COVID emergency on May 11. The White House also announced its opposition to the two bills up for a vote today.

But Republicans pressed ahead anyway and easily passed both measures despite the GOP’s narrow majority in the House.

The Pandemic is Over Act, which would end the public health emergency, passed 220-210 in a vote that saw every Republican vote for it and every Democrat vote against it. But the Freedom for Health Care Workers Act, which would end the vaccination requirement for federal health care workers, passed 227-203 with help from seven Democrats.

Those Democrat votes came even though Democrat leaders on the House floor argued against both bills. Rep. Frank Pallone, D-N.J., said he opposes the Pandemic is Over Act because it would “abruptly and irresponsibly end the COVID-19 public health emergency virtually overnight,” and Democrats on the floor similarly argued against the bill to end the vaccine requirement. (read more)

Predictably the White House is claiming that if the COVID-19 emergency is over, then Title-42 immigration restrictions -which are based on the emergency- should end.  This means even more illegal aliens crossing the U.S. southern border, an outcome the Biden team embrace.

[ SOURCE ]

Jan 31 2023

Dolly Parton – Don’t Make Me Have To Come Down There


Armstrong Economics Blog/Religion Re-Posted Jan 30, 2023 by Martin Armstrong

There is a rising tide around the world who see what our world leaders are doing and they are doing their best to create World War III. I would like to think enough people will start screaming at our leaders, but our computer makes it clear there is no gain, without the pain.

Jan 30 2023

Sunday Talks, Speaker Kevin McCarthy -vs- Margaret Brennan


Posted originally on the CTH on January 29, 2023 | Sundance

With talking points in hand CBS’s Margaret Brennan drops all pretenses and goes straight into her role as defender of the Biden regime in the White House.

House Speaker Kevin McCarthy appears on Face the Nation for a dueling narrative contest with Ms. Brennan.  WATCH (transcript below):

[Transcript] -Mr. Speaker, good morning to you.

REPRESENTATIVE KEVIN MCCARTHY (R-California): Good morning. Thanks for having me back in studio.

MARGARET BRENNAN: It must be sobering to hear that reminder.

REPRESENTATIVE KEVIN MCCARTHY: Well, it took me a little while to get there, but it feels good.

(LAUGHTER)

MARGARET BRENNAN: Well, you are here now at this key moment in time. And I want to get to some of the top agenda items.

You have accepted an invitation to meet with President Biden. When will that happen, and what offer will you put on the table?

REPRESENTATIVE KEVIN MCCARTHY: Well, we’re going to meet this Wednesday.

I know the president said he didn’t want to have any discussions, but I think it’s very important that our whole government is designed to find compromise. I want to find a reasonable and a responsible way that we can lift the debt ceiling, but take control of this runaway spending.

I mean, if you look at the last four years, the Democrats have increased spending by 30 percent, $400 billion. We’re at a 120 percent of GDP. We haven’t been in this place to debt since World War 2. So we can’t continue down this path.

And I don’t think there’s anyone in America who doesn’t agree that there’s some wasteful Washington spending that we can eliminate.

MARGARET BRENNAN: Mm-hmm.

REPRESENTATIVE KEVIN MCCARTHY: So, I want to sit down together, work out an agreement that we can move forward to put us on a path to balance, at the same time, not put any — any of our debt in jeopardy at the same time.

MARGARET BRENNAN: But avoid a default, in other words?

REPRESENTATIVE KEVIN MCCARTHY: Yes.

MARGARET BRENNAN: But do you have any indication that the president is willing to discuss both lifting the debt ceiling and the issue of future spending?

REPRESENTATIVE KEVIN MCCARTHY: Well, if he’s changed his mind from his whole time in the Senate and vice president before — I mean, he literally led the talks in 2011 and he praised having those talks. This is what he’s always done in the past.

And if he listens to the American public, more than 74 percent believe we need to sit down and find ways to eliminate this wasteful spending in Washington. So, I don’t believe he would change his behavior from before, and I know there’s a willingness on our side to find a way that we can find a reasonable and responsible way to get this done.

MARGARET BRENNAN: But, right, I mean, you know why I’m asking that…

REPRESENTATIVE KEVIN MCCARTHY: Yes.

MARGARET BRENNAN: … in terms of not linking one as leverage for the other.

REPRESENTATIVE KEVIN MCCARTHY: Yes.

Well, in my first conversation — and, to be fair, the president, when he called me to congratulate winning speaker, this is one of the first things I brought up to him. And he said we’d sit down together.

Now, I know his staff tries to say something different, but I think the president is going to be willing to make an agreement together.

MARGARET BRENNAN: Well, we’ll watch for that on Wednesday.

REPRESENTATIVE KEVIN MCCARTHY: I’m hopeful, yes.

MARGARET BRENNAN: I want to dig into what you are willing to put on the table because Republicans campaigned on fiscal responsibility.

You promised you won’t spend more next year than you did last year. Are you willing to consider any reductions to Social Security and Medicare?

REPRESENTATIVE KEVIN MCCARTHY: No. Let’s take those off the table. We want to…

MARGARET BRENNAN: Completely?

REPRESENTATIVE KEVIN MCCARTHY: Yes.

I mean, if you read our commitment to America, all we talk about is strengthening Medicare and Social Security. So — and I know the president says he doesn’t want to look at it, but we’ve got to make sure we strengthen those. I think…

MARGARET BRENNAN: What do you mean by strengthen them? You mean lift the retirement age, for example?

REPRESENTATIVE KEVIN MCCARTHY: No, no, no.

What I’m talking about, Social Security and Medicare, you keep that to the side. What I want to look at is, they’ve increased spending by 30 percent, $400 billion, in four years. When you look at what they have done, adding $10 trillion of debt for the next 10 years in the short time period, if you just look a month ago, they went through and they never even passed a bill through appropriations in the Senate.

While Mr. Schumer has been leader, he’s never passed a budget. He’s never passed the appropriation bill. He simply waits to the — to the end of the year and allowed two senators who are no longer here to write a $1.7 trillion omnibus bill. I think we…

MARGARET BRENNAN: You want to work with Democrats to come to agreement on a budget?

REPRESENTATIVE KEVIN MCCARTHY: Yes.

MARGARET BRENNAN: Is that what you’re saying?

REPRESENTATIVE KEVIN MCCARTHY: Yes, I — I first think our very first responsibility, we both should have to pass a budget. We both should have to pass the appropriations bill, so the country can see the direction we’re going.

But you cannot continue the spending that has brought this inflation, that has brought our economic problems. We’ve got to get our spending under control.

MARGARET BRENNAN: OK, just fact-check, though, 25 percent of the debt was incurred during the last four years of the Trump presidency. I mean, this is cumulative debt over many, many years.

REPRESENTATIVE KEVIN MCCARTHY: Yes, well, over the short — this time period.

MARGARET BRENNAN: Yes.

REPRESENTATIVE KEVIN MCCARTHY: But you’ve also found that you had a pandemic.

MARGARET BRENNAN: Right.

REPRESENTATIVE KEVIN MCCARTHY: And, as that pandemic comes down, those programs leave. I have watched the president say he cut it.

No, it is spending $500 billion more than what was projected. They have spent more. And we’ve got to stop the waste.

MARGARET BRENNAN: Is defense spending on the table?

REPRESENTATIVE KEVIN MCCARTHY: Well, look, I — I want to make sure we’re protected in our defense spending, but I want to make sure it’s effective and efficient.

I want to look at every single dollar we’re spending, no matter where it’s being spent. I want to eliminate waste wherever it is.

MARGARET BRENNAN: But when you became speaker, you did come to that agreement I have referenced of capping ’24 spending at ’22 levels.

REPRESENTATIVE KEVIN MCCARTHY: Well, look, listen…

MARGARET BRENNAN: So that would call for reductions.

REPRESENTATIVE KEVIN MCCARTHY: Well, I mean, look, you’re going to tell me, inside defense, there’s no waste? Others? I mean…

(CROSSTALK)

MARGARET BRENNAN: So defense spending is up for negotiation?

REPRESENTATIVE KEVIN MCCARTHY: They spend a lot of — I think everything, when you look at discretionary, is sitting there.

It’s like every single household. It’s like every single state. We shouldn’t just print more money. We should balance our budget. So I want to look at every single department. Where can we become more efficient, more effective, and more accountable? That should be…

MARGARET BRENNAN: So, more efficiencies in Social Security and Medicare as well?

REPRESENTATIVE KEVIN MCCARTHY: The one thing I want to say, we take Social Security…

MARGARET BRENNAN: Completely?

REPRESENTATIVE KEVIN MCCARTHY: … and Medicare off the table.

MARGARET BRENNAN: Would you support a short-term debt limit extension until September, buy more time for talks?

REPRESENTATIVE KEVIN MCCARTHY: Look, I don’t want to sit and negotiate here.

I would rather sit down with the president, and let’s have those discussions. The one thing I do know is, we cannot continue the waste that is happening. We cannot continue just to spend more money and leverage the debt of the future of America.

MARGARET BRENNAN: Right.

REPRESENTATIVE KEVIN MCCARTHY: We’ve got to get to a balanced budget.

MARGARET BRENNAN: Well, and I think many people would agree with you on the issue of fiscal responsibility, but there’s that deadline on the calendar in terms of facing potential default.

Are you saying…

REPRESENTATIVE KEVIN MCCARTHY: Well, wait. Wait a minute…

MARGARET BRENNAN: … you will guarantee the United States will not do that?

REPRESENTATIVE KEVIN MCCARTHY: Listen, we’re not going to default.

But let me be very honest with you right now. So we hit the statutory date. But let’s take a pause. We have hundreds of billions of dollars. This won’t come to fruition until sometime in June. So the responsible thing to do is sit down like two adults and start having that discussion.

MARGARET BRENNAN: Mm-hmm.

REPRESENTATIVE KEVIN MCCARTHY: Unfortunately, the White House was saying before, like, they wouldn’t even talk.

MARGARET BRENNAN: Right.

REPRESENTATIVE KEVIN MCCARTHY: I’m — I’m thankful that we’re meeting on Wednesday, but that’s exactly what we should be doing.

And we should be coming to a responsible solution. Every family does this. What is — what has happened with the debt limit is, you reached your credit card limit. Should we just continue to raise the limit? Or should we look at what we’re spending?

MARGARET BRENNAN: Well, it’s paying past commitments.

REPRESENTATIVE KEVIN MCCARTHY: If Chuck Schumer — yes, but if — no, no.

Chuck Schumer never passed a budget since he’s been leading. He’s never passed an appropriation bill. Those are the most basic things that Congress should do. And what — if you’re going to show to the American public where you want to spend your money, and if you’re going to ask the hardworking taxpayer for more of their money, you first should lay out how you’re going to spend it, and you should eliminate any waste, so you don’t have to raise more taxes.

MARGARET BRENNAN: But just to put a fine point on it, because it matters a lot to the markets in particular, you will avoid a default? You will not let that happen on your watch?

REPRESENTATIVE KEVIN MCCARTHY: Look, there will not be a default.

But what is really irresponsible is what the Democrats are doing right now, saying you should just raise the limit.

MARGARET BRENNAN: But would you…

REPRESENTATIVE KEVIN MCCARTHY: I think…

MARGARET BRENNAN: Would you get in the way — if 15 Republicans came to you and said they would be willing to raise the debt limit…

REPRESENTATIVE KEVIN MCCARTHY: The only person — but let me be very clear.

MARGARET BRENNAN: … would you allow them to do so with Democrats?

REPRESENTATIVE KEVIN MCCARTHY: The person — the only person who is getting in the way right now is the president and Schumer. They won’t even pass a budget. They won’t even negotiate. We have now until June.

I want to make sure we have something responsible, something that we can move forward on and something that we can balance our debt with. So I’m looking for sitting down. That’s exactly what I have been asking for. The only one who’s playing with the markets right now is the president to have the idea that he wouldn’t talk.

Does the president really believe and, really, all your viewers, do you believe there’s no waste in government? Do you believe there was no waste in that $1.7 trillion? That’s what we were spending just four weeks ago. So, I think the rational position here is, sit down, eliminate the waste and put us on a path to balance.

MARGARET BRENNAN: We’ll watch for that meeting on Wednesday.

I want to ask you about your vision of leadership. You made a number of deals within your party to win the speakership. Senator Mitch McConnell, your Republican colleague, said: “Hopefully McCarthy was not so weakened by all this that he can’t be an effective speaker.”

How can you effectively govern with a very narrow majority and when your conference is so divided?

REPRESENTATIVE KEVIN MCCARTHY: Well, that may be somebody else’s opinion. So let’s just see what my father always said. It’s not how you start. It’s how you finish.

So, let’s — you see what happened in the first week. So, in the very first week, we have passed what? We repealed the 87,000 IRS agents. We bipartisanly created a new Select Committee on China, where 146 Democrats joined with us.

We bipartisanly passed to stop the Strategic Petroleum Reserve being sold to China, where 113 Democrats joined with us. We have just now, for the first time on the House — it hasn’t happened in seven years, the entire time the Democrats were in the majority, where you had an open rule.

And let me explain what that is. An open rule allows every single member of the House to offer an amendment on a bill. So what I’m trying to do here is let every voice in America have their ability inside the House. We opened the House back up so the public could actually join.

MARGARET BRENNAN: So you’re arguing you haven’t been weakened? But…

REPRESENTATIVE KEVIN MCCARTHY: I — no, it’s only been strengthened.

Maybe people didn’t like what they saw that we didn’t win on the very first vote, but that was democracy. And what you found at the end of the day, we’re actually stronger.

MARGARET BRENNAN: Well, I would…

REPRESENTATIVE KEVIN MCCARTHY: You know what else?

MARGARET BRENNAN: Yes.

REPRESENTATIVE KEVIN MCCARTHY: We changed it where members of Congress now have to show up for work. I know, in the Senate, they don’t come very often.

But if you look what we’ve been able to do, we’re transforming Congress. We’re looking for solutions.

MARGARET BRENNAN: But you also allowed one — just one member now can force a vote to oust you as speaker.

REPRESENTATIVE KEVIN MCCARTHY: OK.

MARGARET BRENNAN: How can you expect to serve in the next two years in this role?

REPRESENTATIVE KEVIN MCCARTHY: Exactly how every other speaker has served with that.

MARGARET BRENNAN: Without those rules like that right now.

REPRESENTATIVE KEVIN MCCARTHY: No.

MARGARET BRENNAN: That’s a risk.

REPRESENTATIVE KEVIN MCCARTHY: OK.

MARGARET BRENNAN: I mean, do you really think you can control the Freedom Caucus and some of those more conservative members who gave you such a hard time?

REPRESENTATIVE KEVIN MCCARTHY: Everybody has a voice.

But let me — let me explain that. That one vote to vacate, that’s not new. That’s been around for 100 years. The only person who took it away when they got a small majority was Nancy Pelosi. So, Nancy felt she did not have the power to stay in office if that was there. I’m very comfortable in where we are.

MARGARET BRENNAN: OK.

REPRESENTATIVE KEVIN MCCARTHY: So I don’t have any fear in that.

MARGARET BRENNAN: You don’t regret any of the concessions you made?

REPRESENTATIVE KEVIN MCCARTHY: The only concession I made was taking it from five to one, where it’s been around for 100 years.

MARGARET BRENNAN: I want to ask you about some of the makeup of your caucus.

REPRESENTATIVE KEVIN MCCARTHY: Yes.

MARGARET BRENNAN: According to CBS records, 70 percent of the House GOP members denied the results of the 2020 election.

You’ve put many of them on very key committees, Intelligence, Homeland Security, Oversight. Why are you elevating people who are denying reality like that?

REPRESENTATIVE KEVIN MCCARTHY: Well, if you look to the Democrats, their ranking member, Raskin, had the same thing, denied Trump when Bush was in there. Bennie Thompson, who was the…

(CROSSTALK)

MARGARET BRENNAN: Did you see those numbers we just put up there?

REPRESENTATIVE KEVIN MCCARTHY: Did you see the — yes.

MARGARET BRENNAN: Seventy percent.

REPRESENTATIVE KEVIN MCCARTHY: Did you also be fair and equal and where you looked at Raskin did the same thing. Bennie Thompson, who’s a ranking member and was the chair?

These individuals were chair in the Democratic Party.

MARGARET BRENNAN: I’m asking you, as leader of Kevin McCarthy’s House…

REPRESENTATIVE KEVIN MCCARTHY: But I’m also — I’m also…

MARGARET BRENNAN: … why you made these choices. These were your choices.

REPRESENTATIVE KEVIN MCCARTHY: Yes, They’re my choices, but they’re the conference choices.

But I’m also asking you, when you look to see just Republicans, Democrats have done the same thing. So maybe it’s not denying. Maybe it’s the only opportunity they have to have a question about what went on during the election.

So, if you want to hold Republicans to that equation, why don’t you also hold Democrats? Why don’t you hold Jamie Raskin? Why don’t you hold Bennie Thompson, when Democrats had appointed them to be chair? I never once heard you ask Nancy Pelosi or any Democrat that question when they were in power in the majority, when they questioned…

MARGARET BRENNAN: You’re talking about things going back to 2000, which was a time…

REPRESENTATIVE KEVIN MCCARTHY: Well, you’re talking about…

MARGARET BRENNAN: … when I didn’t have this show back then…

REPRESENTATIVE KEVIN MCCARTHY: Yes.

MARGARET BRENNAN: … which is why I’m asking you now about your leadership.

REPRESENTATIVE KEVIN MCCARTHY: No, on, but they were — they were in power last Congress. So, why — why…

MARGARET BRENNAN: But you’re talking about questions from 2000 election.

REPRESENTATIVE KEVIN MCCARTHY: But you’re asking me about that happened to another Congress.

MARGARET BRENNAN: About these choices you just made, you just made.

REPRESENTATIVE KEVIN MCCARTHY: You’re asking about questions for another Congress.

So, the only thing I’m simply…

MARGARET BRENNAN: This is your Congress.

REPRESENTATIVE KEVIN MCCARTHY: These — these are members who just got elected by their constituents, and we put them into committees, and I’m proud to do it.

MARGARET BRENNAN: Let me ask you about some specifics then. Marjorie Taylor Greene, you put her on a new subcommittee to investigate the origins of COVID.

REPRESENTATIVE KEVIN MCCARTHY: Yes.

MARGARET BRENNAN: She compared mask requirements to the type of abuse Jews were subjected to during the Holocaust. She called for Fauci to be arrested and imprisoned, and she spread conspiracy theories.

How is anyone supposed to take that work seriously and find that work credible?

REPRESENTATIVE KEVIN MCCARTHY: Very well. You look at all of it, so you have all the questions out there. I think what the American public…

MARGARET BRENNAN: You think these are legitimate questions?

REPRESENTATIVE KEVIN MCCARTHY: I think what the American public wants to see is an open dialogue in the process. This is a select committee where people can have all the questions they want, and you’ll see the outcome.

MARGARET BRENNAN: You know that there is a lot of doubt about institutions and faith in institutions in this country.

REPRESENTATIVE KEVIN MCCARTHY: Oh, yes, when you saw what happened in Congress where they had proxy voting, where bills didn’t go through committees, and you…

(CROSSTALK)

MARGARET BRENNAN: I don’t think most people know what proxy voting is.

REPRESENTATIVE KEVIN MCCARTHY: Well, let — well let — Well, let’s explain what proxy…

MARGARET BRENNAN: But — but approval…

(CROSSTALK)

REPRESENTATIVE KEVIN MCCARTHY: But I think it would be fair to your viewers…

MARGARET BRENNAN: Approval level, according to Gallup, of Congress is at 22 percent. Approval level of journalists is also not very high, I will give you that.

But doesn’t it further wear down credibility when you put someone who is under state, local, federal, and international investigation as a representative of your party on committees?

REPRESENTATIVE KEVIN MCCARTHY: Are you talking about Swalwell?

MARGARET BRENNAN: I’m talking about George Santos…

REPRESENTATIVE KEVIN MCCARTHY: No, I…

MARGARET BRENNAN: … representative from New York.

REPRESENTATIVE KEVIN MCCARTHY: Well, we should have that discussion. So let’s have that discussion.

You want to bring up Santos, and let’s talk about the institution itself, because I agree wholeheartedly that Congress is broken. And I think your — I think your listeners or viewers should understand what proxy voting was, because it never took place in Congress before.

MARGARET BRENNAN: But I’m asking you about George Santos.

REPRESENTATIVE KEVIN MCCARTHY: I know you asked me a question. Let me ask you.

MARGARET BRENNAN: Because you could put it to a vote to try to oust him.

REPRESENTATIVE KEVIN MCCARTHY: You asked me a question. I would appreciate if you let me answer.

So let’s go through this, because it’s not one simple answer. Congress is broken, based upon what has transpired in the last Congress. The American public wasn’t able to come in to see us. People voted by proxy, meaning you didn’t have to show up for work, Bills didn’t go — have to go through committee.

So what I’m trying to do is open the people’s house back for the people so their voice is there, so people are held accountable.

So, now, as I just had in the last week, for the first time in seven years…

MARGARET BRENNAN: Yes.

REPRESENTATIVE KEVIN MCCARTHY: … every member got to vote.

MARGARET BRENNAN: If you got a third of your caucus to vote to oust him, you could do so.

(CROSSTALK)

MARGARET BRENNAN: Do you — you don’t think you could get your Republicans to do that?

REPRESENTATIVE KEVIN MCCARTHY: I wasn’t finished answering the question.

So, if every single new person brought into Congress was elected by their constituents, what their constituents have done is lend their voice to the American public. So those members can all serve on committee.

Now, what I’m trying to do is change some of these committees as well, like the Intel Committee is different than any other committee.

MARGARET BRENNAN: So, you’re just not going to answer the question I asked?

REPRESENTATIVE KEVIN MCCARTHY: Well, no, I — no, you don’t get a question whether I answer it. You asked a question. I’m trying to get you through that.

MARGARET BRENNAN: I don’t think you’ve said the name George Santos, like, once.

(LAUGHTER)

MARGARET BRENNAN: I have asked you a few times.

REPRESENTATIVE KEVIN MCCARTHY: But you know what? I just — but — but…

MARGARET BRENNAN: You’re talking about proxy voting and other things.

REPRESENTATIVE KEVIN MCCARTHY: No, no, no, but — no, you started the question with Congress was broken, and I agreed with you.

MARGARET BRENNAN: No. Congress…

REPRESENTATIVE KEVIN MCCARTHY: But I was answering the question of how Congress is broken and how we’re changing it.

So, if I can finish the question that you asked me, how Congress is broken, I equated every single member…

MARGARET BRENNAN: Yes.

REPRESENTATIVE KEVIN MCCARTHY: … that just got elected by their — by their constituents. They have a right to serve.

MARGARET BRENNAN: OK.

REPRESENTATIVE KEVIN MCCARTHY: So that means that Santos can serve on a committee…

MARGARET BRENNAN: OK.

REPRESENTATIVE KEVIN MCCARTHY: … the same way Swalwell, who had a relationship with a Chinese spy.

MARGARET BRENNAN: Speaker…

REPRESENTATIVE KEVIN MCCARTHY: But they will not serve on Intel, because I think…

(CROSSTALK)

MARGARET BRENNAN: They’re wrapping me in the control room, because we have a break.

REPRESENTATIVE KEVIN MCCARTHY: Well that’s unfortunate. I wish I could answer the question.

MARGARET BRENNAN: I have to leave it there. I would love to have you back.

REPRESENTATIVE KEVIN MCCARTHY: I would love to be able to come back and have time to answer the questions.

MARGARET BRENNAN: OK. We’ve spent a lot of time here, and I have more questions for you.

But I got to go.

Jan 23 2023

The Petrodollar – Another Fake News Invention?


Armstrong Economics Blog/Gold Re-Posted Jan 23, 2023 by Martin Armstrong

The entire theory of the Petrodollar dares back to the collapse of Bretton Woods and the subsequent oil embargo protesting US support for Israel and the price shock of raising prices. Those were the days when everyone was obsessed with gold and the whole idea of a floating currency that was popular to say will crash and burn for money had to be backed but some commodity. Those were indeed the days when that theory was very popular and it dominated the thinking process of the 1970s.

Here is an advertisement from my past days as a market maker in gold during 1970s to about 1983. I too believed in all those theories until the crash came in 1975. I too had bought into all that nonsense. Gold was going to be legalized in the United States in 1975 for the first time since 1934. Being a very large dealer domestically and internationally, all my European clients were talking up the scenario that gold was going to $500 if not $1000 once Americans could buy.

Because Teddy Roosevelt was an ancient coin collector, when Franklin Roosevelt, who was a stamp collector, recognized that gold coins existed from ancient times thanks to Teddy, he confiscated gold on deposit at the banks but exempted collector coins. That was the reason why we have rolls of $20 gold coins trading to this day.

As a result, those who were really believers in gold would buy common date American $20 gold coins by the roll in those days. So when the Europeans were talking themselves into gold was going to explode in 1975 as soon as it was legalized in the United States, as a dealer, I never got a single call about buying gold from anyone other than those who already owned it. The gold crowd was only looking at gold and had no idea that any American who wanted gold bought it in coin form. They were cheering gold without understanding the reality of the marketplace.

I went short gold in January 1975 not using even technical analysis. The hype was so much and I knew that there was no line standing at the door to buy gold. My gut feeling was that gold was going to decline – not rally. I saw that in 1970 when the two-tier gold market they created in 1968 saw gold drop below the official price of $35 in 1970 – something that was not supposed to happen.

Even the Senate of New Jersey came to me and I wrote the law on sales tax regarding gold in 1974. Gold peaked in December 1974 at $197.50. It fell to $97.70 while inflation continued but economic growth declined and they called it STAGFLATION. I learned back then that all the scenarios and theories that gold rises with inflation and the dollar would not survive without some backing. I was confronted by the reality that exposes all these theories to be a throwback to times long since passed. This all only inspired me, even more, to investigate everything in detail. By 1979, I published what I called the WHY REPORT. I later republished this in 1981 and again in 1983.

To explain the survivability of the dollar since it rose between 1972 and 1976 against the British pound, with the collapse of Bretton Woods, the rise in gold, and the entire oil embargo, that is when they came up with this idea that the dollar was backed by oil. They had to explain why their theories were wrong just as they changed global warming to climate change to explain away global cooling.

All the theories were wrong. The dollar rose, and inflation soared, as did gold. None of this made sense under their theories. Something had to be done. It became obvious that it was impossible to make investment decisions based upon these theories that people just made up to sell gold which are still being used today. I also remembered that in January 1970, gold fell in the London market to $34.70. Gold was not supposed to sell below the Bretton Woods fixed exchange rate of dollars to gold. It was like being smacked in the face and told to wake up!

Without question, the dealers could not sell gold if it did not rise with inflation and against the dollar since it was no longer backed by anything. They had to invent something new. That is when the sophistry specialists stepped in and boy did they succeed in bullshitting everyone.

The explanation was ah ha – the dollar is really backed by oil because it is priced in dollars. That’s it. It is really the Petrodollar! Suddenly the dollar became de facto-backed by oil. They needed an explanation to explain why all the old theories were wrong. They sold this theory and it made the front cover of Newsweek. Everyone said YES! That must be the reason. OPEC priced oil in dollars! Naturally, everything was priced in dollars because, under the fixed exchange rate of Bretton Woods, everything from wheat and corn to copper and gold was all priced in dollars.

Many people are now calling for the collapse of the dollar all because Saudi Arabia has confirmed that they will be selling oil in various currencies. Hence, relying on this old fictitious their of the Petrodolarr from the ’70s, they are telling everyone the dollar will collapse and gold will soar. They never get tired of kicking the same theories down the road without EVER just once being honest and looking if they have any validity whatsoever.

The value of any currency is NOT some commodity. It is the people. You can have all the gold in the world, but if the people do not produce, it means nothing. Indeed, Russia had the largest gold reserve of any nation ahead of the Communist Revolution. They took the gold reserves and hid them so the communists would never find them. They are still missing to this very day. Likewise, Germany and Japan has no gold reserves post-WWII yet they rose to the strongest economies in their respective regions. How is that possible? It is very simple. The true backing of a currency is the total productive capacity of its people. The US became the largest economy in the world NOT  because of gold, but because the US had a consumer-based economy built of freedom rather than Marxism as the problem with Europe. China, Japan, and Germany, all focused on the old-world mercantile economic model. Produce to sell to someone else. They failed to follow the strength of the United States in building a consumer economy.

China understands the difference and has shifted to develop that type of economy whereas Germany oppresses its people with high taxes on its citizens to sell manufactured goods to everyone else. That is why they wanted the Euro to expand their European economic marketplace.  Germany’s high taxes have put it near the bottom insofar as the German people have less net worth than Italians. The more Marxist the country, the lower the economic standard of living.