Loading ...Well, let’s just go over a couple of things you said there. So, candidate Trump said he was going to pay off the national debt. And let me caveat this by saying that I voted for President Trump. I think he’s infinitely better than what we have to face possibly in November of next year. But candidate Trump said he was going to pay off the national debt, which was under $20 trillion is like $18, $19 trillion at that time. It’s now $22.5 trillion.
So, not only did we not pay off the debt, we’ve added to it, and we’re adding to it now at the pace, as you correctly point out, of over $1 trillion per annum. And this is when the unemployment rate, Mike, is at multi-decade lows. And when we have the next recession, when the automatic stabilizers kick in, welfare, food stamps, unemployment insurance, =. And that’s assuming that the interest on the debt stays quiescent. So that’s a pretty big assumption, by the way, so we could be adding close to 15% of GDP, 15% of GDP per annum to our national debt. That’s how scary things could be.
And who’s going to buy all this debt? And at what interest rate? We were talking about repo market before, banks are loaded with Treasuries. By the way, these treasuries have a zero risk rating in the capital ratios. That’s how they’re calculated. What happens when these Treasuries really tank in price, what happens to the bank solvency? So, that’s a big question for us.
You and I talk about things all the time about how awkward and how tenuous and fragile the global economy has become. But so far, it hasn’t really become acutely manifest other than we had that little slight hiccup. We had one in 2016, we had one at the end of 2018, but central banks are doing something. Global central banks have printed $22 trillion worth of counterfeit money in the past decade to re-inflate asset prices and try to make the massive $250 trillion global debt pile serviceable. That’s a tremendous amount of printing to paper over what’s really going on in the world.
Let me repeat that. $22 trillion worth of new money, of fiat paper, has been created in the past decade. Think about that.
https://www.gold-eagle.com/article/michael-pento-scary-warning-signs-cash-funding-markets