We have the BriCs: this is China, Russia, Brazil, India, South
Africa. Altogether now, that's probably
about half the world's population. And
it's probably half of the traded goods (laughs). And so they're setting up a system in which
they settle their trade with one another in their own currencies. The dollar is no longer used as a reserve
currency. They're setting up their own
version of an IMF. They're just going to
bypass all the Western institutions. We
see in China and Asia the rise of an Asian currency bloc, which is being
organized around the Chinese currency.
We see deals with Japan and China to settle their trade with one another
in their own currencies.
So the demand and use for the dollar is about to rapidly
constrict. We'll have a situation where
the Feds are not only creating a trillion new dollars more than the demand is
growing, but the demand will be shrinking!
And so the thing will blow up.
And when the dollar bubble pops, so does the bond market bubble, the
stock market bubble. We will have the
biggest economic catastrophe in the history of the world, and there is no
solution. The United States will go from
being a so-called superpower to a nothing!
It could happen at any time.
It's a perfect storm that the idiot policy makers have created because
they don't serve the public interest, they serve a few rich bankers. The whole thing has been keyed toward
protecting the banks that our deregulation policy allowed to get to big to
fail. Not only that, but the public
officials, the Secretary of the Treasury, the FED, the financial regulatory
agency heads, they're all the former bankers themselves, all their
proteges. You have a situation where the
class that caused the crisis is running the solution, and the solution is to
keep the banks from having any pain; what it does to the rest of us is not
their concern.
Rob Kall: I've been calling, along with a number of
others, for an end to billionaires, a "No Billionaires" program. That the billionaires have just too much
power, these oligarchs are buying and running our politics, our nations. What do you think about the idea of a no
billionaires policy?
Paul Craig
Roberts: I don't mind it, but I don't
think that addresses the real issue.
Because the people running the policy are not individual rich people:
they are the very large financial institutions.
They may finance billionaires in some scheme a billionaire has, but the
power is Goldman Sachs, JP Morgan Chase, Citibank, Bank of America. It's these financial institutions, they have
financialized the economy. The economist
Michael Hudson has made it clear that what's happened is Industrial Capitalism
is over and done with. We have Financial
Capitalism, and what they do is, they organize a whole economy so that all the
surplus is drawn off in interest paid to banks.
The banks any longer finance plant equipment and industries. It's "Debt Peonage," that's what Michael
Hudson calls it, Debt Peonage, where increasing shares of national income are
drawn off into the banks in interest and fees, all that sort of thing. And so there's no -- even if consumers had
growing incomes with an increasing share drawn off into interest payments, that
leaves very little for increased demand for goods and services. You kill it, you kill the economy by
financializing it. And that's what's
really happened.
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