QUESTION: Dear Martin
Could you elaborate on what you expect when you talk about the collapse of the monetary system?
Will there be differences between countries like Germany and Switzerland, for example? Especially in the pension system.
I guess there can be big differences between countries.
Many thanks and best wishes,
ANSWER: The monetary system collapsed with the victory of the American Revolution. State and federal continental currencies could be exchanged for a new currency, which became the US dollar. There was great disparity between the states, each priced by the market for the swap. Even when they created the euro, there were differences between each currency.
The IMF is pushing very hard right now behind the scenes to replace the dollar with the IMF’s digital currency, which they want to make the reserve currency. This would be EXTREMELY dangerous as the IMF is mired in corruption. China’s complaint, for example, is that the dollar is a reserve currency, and they see this as a dangerous force in the hands of the enemy.
I have written extensively about the real problem of the dollar acting as a reserve currency and how this has pushed the Federal Reserve into its role as the default central bank of the world. The problem is all the propaganda against the Fed that the gold bugs are spinning and which completely distorts the real crisis. They are only trying to sell gold based on the quantity theory of money, which dates back to the 17th century. It’s so outdated it’s even funny. It is fully focused on the domestic market, excluding the global economy and international capital flows. Unfortunately, the Fed also lives in the past and views the economy only in terms of domestic conditions, turning Fed policy into fiscal policy over which they have no control.
Only when you understand the movement of international capital flows can you even get a glimpse of the real world. World War I forced the capital to flee Europe and rush to America. Because this capital was here, it increased domestic purchasing power and the Europeans made the roar of the 1920s. They participated in Auto-Stock-Boom.
The first G4 took place in 1927 when other central banks said the US should lower its interest rates to divert the international capital that Europe needed to recover. Indeed, capital inflows peaked in 1927 and began to decline. But it was the sovereign debt crisis of 1931 that forced a large capital outflow to cover domestic losses.
Hoover explained the crisis of 1931 in his memoirs. So, to answer your question, I will take a large report that I intend to publish. The topic is very complex and people should be aware of the major discrepancies. The bottom line is that all governments are going to default on their previous debts. This is what happened even with the fall of the continental government after the victory in the American Revolution.
We see similar results in France with their revolution. We’re facing a major global debt default, and we’re cycling on schedule to the next period of sovereign default.