Mish's Global Economic Trend Analysis Message Board

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Strategies & Market Trends : Mish's Global Economic Trend Analysis

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To: Little Joe who wrote (106067)	1/5/2010 2:35:56 PM
From: Skeeter Bug	1 Recommendation Read Replies (4) of 116555

LJ, they can't really end the wars. Not b/c we need to be out killing people, but they need ready made excuses to continue to escalate debt. Our money supply is debt. Our GDP growth is, in actuality, debt growth. 1. 95-99% of all money is debt. 2. Money is created by issuing debt (think mortgage, car loan, credit card expansion - the money comes from nowhere and is based upon debt). 3. Only the principle is created when the debt is issued - not the money required to pay the interest portions of the debt. 4. Either the banks have to make 100% of their interest earnings available for society to earn (they obviously don't!) or society has to continually take on more and more debt to make it even possible to pay of previous debts with interest. 5. It is impossible to pay back our debts - we will run out of money first. In short, our money supply is effectively a debt based Ponzi scheme that requires ever increasing debt until, one day, the debt blows up. "One day" appears to have commenced as of 2007/2008. market-ticker.denninger.net market-ticker.denninger.net If they end the wars and pull the troops back, the significant reduction in annual debt increases will significantly reduce the money supply and make previous debts mathematically impossible to pay back. This is also known as a deflationary spiral. Search youtube for "money as debt" and check out two videos, "Money as Debt" and "Money as Debt II - Promises Unleashed." They can increase the debt in other ways, but banksters and Congress own a lot of defense related stock. projectcensored.org For some other good reading material... projectcensored.org

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