More Deflationary Pressures on The Global Economy: Venezuelan companies willing to pay up to 7% to move U.S dollars out of the country – May 26, 2021,

To the people who value their wealth in U.S dollars, they might find it extremely difficult to interpret my interpretation of what’s happening in the global economy. I value the entire global economy in Gold. It’s my belief that the value of gold is about to bottom because of the amount of U.S dollar-denominated debt owed all over the world.

Deflation huh? Have you not seen all the consumer price inflation?

Just because central banks are providing liquidity doesn’t mean the ECONOMY is inflating, the whole purpose of having a central bank is for the wealth effect during economic downturns. That’s always been the goal of believers of central banks, HIDE DEFLATION, because during deflationary cycles governments lose control of the narrative.

Governments don’t want people to become wealthy, because wealthy minded people are independent of government and hard toocontrol, that’s the reason why Switzerland as an example has avoided war for so long, and why Switzerland is such a decentralized country. I’m in no way calling Switzerland a perfect country, but its evolution and even the structure of its democracy which gives more power to the municipalities than it does its Federal government is the result of what happens when it becomes a known fact to the people that big ole Federal government is a bad thing.

Hitler hated Switzerland, anyone who understands war, understands why Hitler hated Switzerland Operation Tannenbaum never happened because dealing with what almost appears to be a fractured country would cause all sorts of problems for a centralized Nazi government, Venezuela is the complete opposite of Switzerland, it’s Federal government heavy as are most countries in Latin America and from an economic perspective, the private sector can see when a country is headed in the wrong direction just based on government policy.

Currently, Venezuelan companies are willing to pay up to 7% to move U.S dollars outside of the country, that number is bonkers and it’s a deflationary sign for the EURO-DOLLAR system to show that the U.S dollar is probably going to bounce back sometime in the future and that bounce back is going to be devastating for the global economy.

Under Joe Biden, his policies are U.S dollar consuming, meaning he is forcing the cost of living up for Americans living in America, however, US dollars I suspect in the future are going to be a whole lot more valuable outside of the United States.

The Euro-dollar system exists outside of the control of the U.S Federal Reserve or the U.S government and it’s one of the reasons why the U.S is able to print so much money to finance its government. If you’re not living in the United States and don’t have to pay U.S taxes, what the hell do you care about Joe Biden? That’s an American voter problem. If Americans are dumb enough to vote for a president who promises to raise their cost of living so Joe Biden can grow the size of government that’s a U.S domestic problem, people outside of the U.S don’t care and don’t have to care.

Now, why this is bad for gold is that unless you’re rich, you’re going to be selling your gold, because even if your country is paying a government check to stay at home and do nothing, that GOVERNMENT check is FIXED INCOME.

Meaning if you have a spendthrift politician who is raising the cost of living in the private sector in order to pay you a welfare check to sit at home, locally your currency is going to be WORTH-LESS locally than it might be in the forex markets.

This is all deflationary and for people who buy gold for price appreciation, who don’t have the money to finance their debts, they’re going to sell their gold, it happens every single time. What most people with a decent amount of money, don’t understand is that most people borrow to invest

Bitcoin as an example has a lot of people who borrowed to invest in bitcoin, this is also deflationary because most of these bitcoin people are going to wait until it’s clear their bet went bad before they sell. Smart money is smart money, I wrote about investing in Canadian oil smack dab in the middle of Coronavirus, I bought up Canadian oil companies like my life depended on it, if people remember Oil even went negative, well all of my bets paid off, but I didn’t borrow the money to risk it in Canadian oil companies, I used my own fiat cash.

People who borrow to invest pay the cost of boring, the insurance and often don’t cut back on their own expenses. I’ve seen it up close and it exists in the Gold markets also. A lot of people don’t understand that the purpose of a central bank is to HIDE DEFLATION! You can’t hide gold, most true believer gold hoarders have their gold outlive them.

Gold is INSURANCE, which means it’s inherently deflationary, you have to build your lifestyle to hoard it which means most hoarders of gold have cash flow somewhere because you have to have the cash flow to hoard your gold. Some argue Hitler didn’t evade Switzerland because he wanted to hide his gold there, which is ridiculous from my perspective.

Many countries had people around the world who were heavily invested in Switzerland, most people have Gold in Switzerland to this very day, meaning even if someone was a hardcore white supremacist themselves, they’d finance anyone to kill Hitler if Hitler invaded Switzerland and I haven’t even brought up Switzerland’s military capabilities yet.

The world revolves around incentives and the U.S dollar is widely used primarily because of the Euro-dollar system, I get it, this pisses some people off, it confuses others, but the forex markets should never be confused with the domestic economy. Most people like cash, I spend digital dollars whether digital or credit, I hoard cash, I care nothing for a perfect money system, humans are flawed, I get the whole appeal of Bitcoin, but humans like to f*ck perfect sh*t up, that’s how humans are.

A woman could find a perfect man and she’ll still cheat because she’s human, a man will have the perfect wife, and cheat because he’s a human, we could have the perfect digital money system and humans will find a way to avoid it. I’m a believer in freedom and free markets, but who cares what I believe I’m outvoted by humans who don’t care about what I think the world should be.

If companies are willing to pay 7% to hoard U.S dollars, it shows me that the U.S dollar most likely is going to come roaring back, but if you live in America, don’t assume that a stronger U.S dollar equates to price deflation, Joe Biden is expensive all of is policies revolve around raising the cost of living for Americans living in America, the Euro-dollar system will allow people who hoard U.S dollars outside of the U.S to buy up a lot of things.

Now, the cure for all of this is to normalize interest rates, I’m sorry I don’t see that happening anytime soon. Because normalizing interest rates doesn’t mean that prices in fiat dollars are coming down, prices might still go up for a while, the only way to bring prices down will be austerity measures and that’s not in the public psyche right now.

What I see from Joe public right now is this belief that the problem is ONLY the central banks, and the government is just a dog and pony show, my opinion is that there has always been a demand for a central bank, and humans like dishonest money and corrupt politicians and only change when they’re forced to change.

Once the Welfare State realizes how price inflation works, I suspect EVENTUALLY maybe even a decade from now, austerity measures will be considered, for now, I see a deflationary indebted global economy propped up with liquid central banks. Do not forget that even during the great DEFLATIONARY depression, people were still getting rich!

The people who were getting poorer during the great depression were the people with fixed incomes DEPENDENT on the government, just like today!

Interesting times ahead!