...and whilst on the subject of the impending Global Financial Apocalypse we Loons have been foretelling for some time, now's a good time to, yet again, dust off that famous Jefferson quote...
"If the American people ever allow the banking system to control their money, first by inflation, then by deflation; their children will one day wake up homeless on the continent their fathers conquered."
It is a much repeated though, I suspect, not completely understood quote
I think people understand the inflation part of the con because they have experienced it in their daily lives. Deflation, for the moment anyway, is a much more theoretical concept
Strange things are going on in the world of money right now - retail inflation is going through the roof, yet the prices of shares and commodities are going through the floor
And because I'm such a nice person I'm writing this post to explain to anyone who bumps into it exactly what is happening, and that is...
what the fuck is going on
Quite simple really
The recent spikes in the price of oil and food weren't the result of the Chinese eating steaks and driving SUVs, Peak Oil or biofuel production
All of it
The price volatility is the result of people not knowing whether to hold onto cash or not
- If you expect that the shadowy fuckers who control money supply are going to print money like there's no tomorrow and dilute the value of the £, $ or Euro in your pocket, you would be daft to hold onto the stuff. You'd buy something more tangible with it whilst there were still idiots out there daft enough to take it
- If, on the other hand, you expect the amount of cash in the system to start evaporating, every time a bank goes down the toilet for instance, then you'll hold onto cash and turn everything you can into cash in anticipation of its scarcity and buying power increasing
The trick is, of course, knowing for sure if the amount of money in circulation is going to increase or decrease
And the shadowy fuckers who do know aren't telling
So, there are a lot of very silly, very well paid people moving into and out of cash, commodities, equities and derivatives like headless, very well paid chickens
And, because virtually none of them know what the fuck is going on, they all pile in behind anyone who looks even faintly like he does - which makes for some very large, and not necessarily rational, price swings
It will all end in tears
As it happens, I've had a few emails today from chums and acquaintances in the wonderful world of finance, sharing all sorts of little snippets and rumours of various large institutions bracing themselves for a major poo storm in the next couple of days
And whenever the real poo storm does finally kick off, be it this week, next month or next year, there's one thing you can be sure of. Those of us with money deposited in any bank that fails will have to take their chances. Those of us who owe money to any bank that fails can sleep easy knowing that their debt will be 100% safe whatever happens