Make Believe Money: How Much Longer Can The American Empire Run On Fake Money?

Diocletian Antoninianus (Photo by Sosius11)

Charles Butler of the Daily Reckoning posted the following:

Make Believe Money …

Speaking of “make believe”… I’m going to borrow a quote from my friend, James Powell, who had this to say in his latest letter:

The Fed has been pumping huge amounts of make believe money into the economy to get it going again, and it hasn’t worked. That should be no surprise to anyone but the government. With ‘make believe Money’ you get a ‘make believe recovery’. …

And speaking of Russia… did you hear what Russia has done now to move their de-dollarization plans further down the road? It appears Russia is close to taking the next big step towards de-dollarization and killing the petro-dollar as Vladimir Putin’s “dream” of ruble-based pricing of its domestically-produced oil is on the verge of realization. SPIMEX (The St. Petersburg International Mercantile Exchange) is actively courting international oil traders to join its emerging futures market, which as Bloomberg reports, is designed “to create a system where Russian oil is priced and traded in a fair and straightforward way.”F. William Engdahl was quoted as saying, “This move could deal a dramatic blow to the petrodollar’s dominance”. You think? WOW. A new Mr. Obvious for us today! …

For What It’s Worth. It’s not every day that I get to quote the great James Grant, he of the Interest Rate Observer newsletter that has strict rules about using snippets of his letter. But when he gives an interview with someone else, then it’s all fair game, and nothing makes me smile larger regarding this stuff than finding an interview with James Grant. So, the interview is really long, but you can find it all at ZeroHedge it was post last Friday, or opt for the snippet:

Diminishing returns is the essential problem of the debt: Past a certain level of encumbrance, a marginal dollar of borrowing loses its punch. There’s a moral dimension to the problem as well. There would be less debt if people were more angelic. Non-angels, the taxpayers underpay, the bureaucrats over-remit and everyone averts his gaze from the looming titanic cost of future medical entitlements. Topping it all is 21st-century monetary policy, which fosters the credit formation that leads to the debt dead end. The debt dead end may, in fact, be upon us now. A monetary dead end could follow.

Thus, the thought processes of Janet Yellen’s predecessor. Reading him, we are struck, as ever, by his clinical detachment. Does the deployment of helicopter money not entail some meaningful risk of the loss of confidence in a currency that is, after all, undefined, uncollateralized and infinitely replicable at exactly zero cost? Might trust be shattered by the visible act of infusing the government with invisible monetary pixels and by the subsequent exchange of those images for real goods and services? The former Fed chairman seems not to consider the question- certainly, he doesn’t address it.

To us, it is the great question. Pondering it, as we say, we are bearish on the money of overextended governments. We are bullish on the alternatives enumerated in the Periodic table. It would be nice to know when the rest of the world will come around to the gold-friendly view that central bankers have lost their marbles. We have no such timetable. The road to confetti is long and winding.

Chuck again. James Grant says that “we judge that the government’s money is a short sale.” http://dailyreckoning.com/make-believe-money/

Let me try to summarize some of this.

The USA has created money out of thin air (which its debt as well as previously ‘quantitative easing’ programs have done) in order to keep the economy moving. Yet creating money does not produce national wealth like manufacturing, agricultural, and energy jobs would. Donald Trump would like to fix that, but the USA has a massive amount of debt that is expected to continue to rise (see CBO points to massive debt: Can the depth of a coming financial crisis be known?).

Russia and China (and others) are working to topple the dominance of the US dollar as the world’s reserve currency. The US dollar is actually backed by NOTHING, but because oil producers mainly price oil in dollars, this has given the appearance of the US dollar being backed. This, of course, is make believe, as at some point oil producers could change this. And Russia, Iran, China, and others are working to not price oil in US dollars.

And then there is the problem of debt. As I have reported here repeatedly, the US is the most indebted nation of all time. While many political leaders act like this can go on indefinitely, that is simply not true.

The US dollar used to be backed by gold and silver. Yet now, because the US dollar is not truly backed by anything tangible (other than a semi-agreement with Saudi Arabia to price oil in dollars), the excess production of US dollars via debt/quantitative easing dilutes the value. This is a modern form of ‘dross’ (a coin that is worth less than it appears because it is not pure silver or gold despite its outward appearance).

As far as currency debasement of ‘hard money’ goes, starting in 1965 the USA started to remove silver from its then silver coins and replace it with cheaper metals. That has been done by others in the past.

Governments have devalued their currencies by making their coins ‘dross’ and this has led to various problems throughout history. Wikipedia noted:

The Antoninianus was a coin used during the Roman Empire thought to have been valued at 2 denarii. It was initially silver, but was slowly debased to bronze. The coin was introduced by Caracalla in early 215 …

But even at its introduction the silver content was only equal to 1.5 denarii. This helped create inflation – people rapidly hoarded the denarii, while both buyers and sellers recognised the new coin had a lower intrinsic value and elevated their prices to compensate. Silver bullion supplies were running short since the Roman Empire was no longer conquering new territory, the Iberian silver mines were exhausted and a series of soldier emperors and usurpers needed coin to pay their troops and buy their loyalty. So each new issue of the antoninianus had less silver in it than the last, and each contributed to ever increasing inflation.

In other words, it was a ‘dross’ coin. The USA continues to try to cheapen its remaining coins as well.

This diluting of the value of coinage/currency is condemned in the Bible:

4 Take away the dross from silver (Proverbs 25:4a).

22 Your silver has become dross, Your wine mixed with water. (Isaiah 1:22)

25 I will turn My hand against you, And thoroughly purge away your dross, And take away all your alloy. (Isaiah 1:25)

18 “Son of man, the house of Israel has become dross to Me; they are all bronze, tin, iron, and lead, in the midst of a furnace; they have become dross from silver. 19 Therefore thus says the Lord God: ‘Because you have all become dross, therefore behold, I will gather you into the midst of Jerusalem. 20 As men gather silver, bronze, iron, lead, and tin into the midst of a furnace, to blow fire on it, to melt it; so I will gather you in My anger and in My fury, and I will leave you there and melt you. 21 Yes, I will gather you and blow on you with the fire of My wrath, and you shall be melted in its midst. 22 As silver is melted in the midst of a furnace, so shall you be melted in its midst; then you shall know that I, the Lord, have poured out My fury on you.’” (Ezekiel 22:18-22)

Although the Bible warns against using dross and diluting the money supply, modern ‘experts’ have a different view. The wrong views on economics will lead to economic problems and ultimately the total crash of the dollar of the USA. Economic problems in Europe may well propel the rise of the Beast power that the Bible warns about.

The USA has repeatedly proven that economic pressures result in its increasing its debt. This has worked for a while, but the time will come when it will end in disaster.

Around 605-625 B.C. Habakkuk wrote a short book of the Bible that has a lot of implications for the time that we are now in. Notice something that God said in it:

5 “Look among the nations and watch — Be utterly astounded! For I will work a work in your days Which you would not believe, though it were told you. (Habakkuk 1:5).

Many, including a COG I was once part of, claim that Habakkuk was prophesying only something for the past that has already been fulfilled (and that group included Habakkuk 2 in its assessment). And if you only look at verse 5 that looks reasonable. Yet, notice that the above is also repeated in the New Testament:

40 Beware therefore, lest what has been spoken in the prophets come upon you:

41 ‘Behold, you despisers,
Marvel and perish!
For I work a work in your days,
A work which you will by no means believe,
Though one were to declare it to you.'” (Acts 13:40-41)

So, there is certainly a duality in some of what Habakkuk wrote. (More on the work for these times can be found in the articles Preparing for the ‘Short Work’ and The Famine of the Word and The Final Phase of the Work.)

There was something for Habakkuk’s time and something for a later time.

Getting back to Habakkuk, here is some of the shocking things God had him write down specifically related to the end times:

2 Then the Lord answered me and said: “Write the vision And make it plain on tablets, That he may run who reads it. 3 For the vision is yet for an appointed time; But at the end it will speak, and it will not lie. Though it tarries, wait for it; Because it will surely come, It will not tarry. ( Habakkuk 2:2-3)

So what did Habakkuk see in this vision that is so bad people should run/flee who read it?

Notice that the prophecy that is being discussed is specifically for the appointed time of the end. It is a prophecy for our time–and will affect the proud. What will happen is so bad “That he may run who reads it.” What is so bad? Habakkuk continues with the following:

4 “Behold the proud, His soul is not upright in him; But the just shall live by his faith.
5 “Indeed, because he transgresses by wine,He is a proud man,And he does not stay at home. Because he enlarges his desire as hell, And he is like death, and cannot be satisfied, He gathers to himself all nations And heaps up for himself all peoples. 6 “Will not all these take up a proverb against him, And a taunting riddle against him, and say, ‘Woe to him who increases What is not his — how long? And to him who loads himself with many pledges’? 7 Will not your creditors rise up suddenly? Will they not awaken who oppress you? And you will become their booty. 8 Because you have plundered many nations, All the remnant of the people shall plunder you, Because of men’s blood And the violence of the land and the city, And of all who dwell in it. (Habakkuk 2:4-8)

Actually, with an admitted debt of over $19 trillion dollars and plans to increase that much further, the USA has increased pledges more than any nation in the history of the planet, especially considering that it keeps running trade deficits. And on a per capita basis, the United Kingdom is one of the most indebted nations on the earth itself.

“The United States has the largest debt in the world” (US News & World Report — Jan 28, 2011 http://www.usnews.com/news/articles/2011/01/28/the-10-countries-with-the-most-debt). Habakkuk 2 teaches that the time will come when people should flee from this indebted nation–the USA!

USA debt has increased greatly since the above came out and is projected to continue to increase for years to come.

Since the prophecy in Habakkuk 2 will be fulfilled at the time of the end (cf. “The message was true, but the appointed time was long…in the latter days, for the vision refers to many days yet to come”, Daniel 10:1,14). Daniel 8:19, 11:27,29,35 uses the same Hebrew term for “appointed time” as Habakkuk 2:3, while Daniel 10, using a different term, ties the latter days to the time in Daniel 8:19. Habakkuk 2 was not fulfilled in its entirety anciently. Also, it makes little sense that Habakkuk would be directed towards the modern nation of Israel as it does not have enemy creditors. It must be a nation or group of nations with some prominence at the appointed time of the end. As far as “violence of the land” as a contributing factor, this would seem to include crime, military missions, and perhaps riots/civil unrest, but might it also include promotion of violent sports?

I, personally, have taught the end time risks of Habakkuk 2 longer than any living COG leader that I am aware of. And the only Church of God group that I am aware of that has been boldly teaching about this warning in Habakkuk 2 for years is the Continuing Church of God. The end time applicability of Habakkuk 2 was even in the first edition–January-March 2013–of our Bible News Prophecy magazine; and the headline shown on the front cover was “Habakkuk’s Warning is for Us Today.”

The Laodicean groups that I am aware of are NOT teaching this. We in the Continuing Church of God expect to tell people WHEN the time the Philadelphians should flee. Jesus specifically told the Laodiceans, in a prophecy, that they needed to repent (Revelation 3:19) or face consequences (Revelation 3:14-19, and that they would be rewarded for doing so (Revelation 3:20). The Laodiceans are Church of God Christians “who keep the commandments of God and have the testimony of Jesus Christ” (Revelation 12:17).

Notice also the following:

How Much Longer Can The American Empire Run On Fake Money?

A gold standard would mean the U.S. would have to earn its way to wealth rather than print money to pay for endless wars, death, and destruction. Nixon took us off the international gold standard in 1971 for that very reason, which enabled banks and financial institutions to get rich by impoverishing Americans with debt and job losses funded by bankers who have access to printing-press money. It also made it possible for America to fund endless wars with debt. But to keep the dollar viable, its leading competitor had to be held at bay. Hence smackdowns like the one this past Wednesday.

But the Russians and Chinese and a host of other countries are sick and tired of being told they have to use dollars for trade when doing so helps fund the U.S. that is outright hostile to those nations and seeks their overthrow. Led by the massive wealth gained by China over the years, financial institutions and a currency backed by gold appear to be well underway so that they can compete with the immoral monetary system the U.S. set up on August 15, 1971. …

You know that countries that sell their oil to China will have to get paid in yuan. If they are a bit shaky on accepting yuan, they can hedge against yuan by taking delivery of gold (not paper delivery but real gold) on the Shanghai Gold Exchange, which, unlike the LBMA in London, is an honest, physical gold market.

So while American economists with PhD’s in economics thumb their noses at gold as money and worship Keynesian lies that suggest nations can get rich by printing endless amounts of money no matter how far into debt and insolvency that takes them, the Russians (who are largely debt free) and the Chinese (not to mention the Iranians and other nations of Asia) are building up their gold reserves for the day when the U.S. self destructs, financially or otherwise.

As an American I don’t wish for that because when that happens there will be untold pain in our country. But clearly, the stage has been set. https://www.miningstocks.com/archive/hotlines/64041973/hotline-2018-04-13.pdf

While gold, per se, is not the real answer to the USA’s problems, not using it officially has contributed to the USA’s debt explosion.

The time will come when the economy of the USA will be totally devastated and those who ignore Habakkuk’s warning will suffer because of it! The time will come when people will NOT value ‘make believe money.’

Does the USA have any hope?

Yes, national repentance:

14 if My people who are called by My name will humble themselves, and pray and seek My face, and turn from their wicked ways, then I will hear from heaven, and will forgive their sin and heal their land (2 Chronicles 7:14)

But at this stage, that does not seem to be likely.

The Bible points out that the descendants of Jacob and Joseph are God’s people (Psalm 77:15; see also Anglo – America in Prophecy & the Lost Tribes of Israel). But, instead of repenting, the USA has been pushing a pro-homosexual, pro-abortion, pro-violence, and pro-debt message. The shock that will come to the USA and the rest of the world (Revelation 13:4) will not just be the end of the USA’s financial dominance, but the end of it militarily (Daniel 11:39).

Hosea prophesied that because the Israelites’ rejected God’s instruction, “the Assyrian shall be his king, because they refused to repent” (Hosea 11:1–5). The final time of the Gentiles is getting nearer (see also When Will the Great Tribulation Begin?).

While the Bible shows that Assyrian Europe will also eventually be punished for what it will do to the USA (e.g. Isaiah 10:12), the Bible shows that the USA will be punished first (Isaiah 10:5-11; see also Anglo – America in Prophecy & the Lost Tribes of Israel).

The solution to the problems in the USA is not investments in the dollar of the USA–which will one day fail–but the coming Kingdom of God. Notice what Jesus taught:

19 “Do not lay up for yourselves treasures on earth, where moth and rust destroy and where thieves break in and steal; 20 but lay up for yourselves treasures in heaven, where neither moth nor rust destroys and where thieves do not break in and steal. 21 For where your treasure is, there your heart will be also. (Matthew 6:19-21)

31 “Therefore do not worry, saying, ‘What shall we eat?’ or ‘What shall we drink?’ or ‘What shall we wear?’ 32 For after all these things the Gentiles seek. For your heavenly Father knows that you need all these things. 33 But seek first the kingdom of God and His righteousness, and all these things shall be added to you. (Matthew 6:31-33)

Some items of possibly related interest may include:

The End of US Dollar Dominance Is the USA losing its economic status? What about the petro-gold-yuan? A related video is also available: US Dollar being challenged by Gold-Petro-Yuan.
Collapse of the Euro and Dollar? War in 2020? Larry Edelson of Money and Markets described aspects of current economic difficulties and explained why he felt matters would get a lot worse. He said war, like World War III, could break out as early as 2020. What did he call the ‘granddaddy of all cycles”? Will matters go as he said? What does the Bible teach? Dr. Thiel provides biblical insights that secular sources often miss. This is a video.
Preparing for the ‘Short Work’ and The Famine of the Word What is the ‘short work’ of Romans 9:28? Who is preparing for it? Here is a link to a related video sermon titled: The Short Work.
The Final Phase of the Work What is the final phase of the work? Who will lead it? Do you have the courage to support it? Here is a related YouTube video titled The Final Phase of the Work. The written article has been translated into Spanish La Fase Final de la Obra.
Should a Christian Vote? This article gives some of the Biblical rationale on this subject. Would Jesus vote for president/prime minister? Is voting in the Bible? This is a subject Christians need to understand. A video of related interest is available titled: Should Christians Vote?
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European Technology and the Beast of Revelation Will the coming European Beast power would use and develop technology that will result in the taking over of the USA and its Anglo-Saxon allies? Is this possible? What does the Bible teach? Here is a related YouTube video: Military Technology and the Beast of Revelation.
When Will the Great Tribulation Begin? 2017, 2018, or 2019? Can the Great Tribulation begin today? What happens before the Great Tribulation in the “beginning of sorrows”? What happens in the Great Tribulation and the Day of the Lord? Is this the time of the Gentiles? When is the earliest that the Great Tribulation can begin? What is the Day of the Lord? Who are the 144,000? Here is a version of the article in the Spanish language: ¿Puede comenzar la Gran Tribulación en 2016 o 2017? ¿Es el Tiempo de los Gentiles? You can also see the English language sermon videos: The Great Tribulation from the Mount of Olives and Can the Great Tribulation begin before 2020? A shorter video is: Will the Great Tribulation Start in 2017?
Two Horned Beast of Revelation and 666 Who is 666? This article explains how the COG views this, and compares this to Ellen White. Here is a link to a prophetic video Six Financial Steps Leading to 666?
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Must the Ten Kings of Revelation 17:12 Rule over Ten Currently Existing Nations? Some claim that these passages refer to a gathering of 10 currently existing nations together, while one group teaches that this is referring to 11 nations getting together. Is that what Revelation 17:12-13 refers to? The ramifications of misunderstanding this are enormous. A related sermon is titled Ten Kings of Revelation and the Great Tribulation.
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The Plain Truth About Gold in Prophecy. How Should a Christian View Gold? What do economists and the Bible teach about gold? Gold and silver may drop in value. Inflation/deflation? What do Christians need to know about gold?
China, Its Biblical Past and Future, Part 1: Genesis and Chinese Characters Where did the Chinese people come from? This article provides information showing that the Chinese peoples must have known about various accounts in the Book of Genesis up until their dispersion after the Tower of Babel. Here is a link to a version of this article in Spanish: ¿Prueban los caracteres chinos la exactitud de la Biblia?
China, Its Biblical Past and Future, Part 2: The Sabbath and Some of God’s Witness in China When did Christianity first come to China? And is there early evidence that they observed the seventh day sabbath?
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Just What Do You Mean — Repentance? Do you know what repentance is? Have you truly repented? Repented of what? Herbert W. Armstrong wrote this as a booklet on this important subject.
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Donald Trump and America’s Apocalypse This 188 page book is for people truly interested in prophecies related to Donald Trump and the United States, including learning about several that have already been fulfilled and those that will be fulfilled in the future. The physical book can be purchased at Amazon for $12.99 from the following link: Donald Trump and America’s Apocalypse.
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