Is the US Debt Crisis Fixable? (2024)

Money, war, religion, markets, geopolitics, social dynamics, the human condition, and societal implications. As everyone with a platform spends their time hyperfocused on single issues that draw you in, this is my attempt to step back to show the larger picture (and potential implications or concerns).

The ever-changing media cycle seems built to give us the attention spans of fruit flies - but there are issues that we should take the time to focus on and understand.

These are those issues.

Topics covered in this post

Introduction: the value of listening to a wide range of SMEs for big issues
The prime movers, experts, and analysts whose ideas are combined here
Defaulting on sovereign debt is trust never earned back by the markets
The dangers of having political animals with zero financial acumen in office
Could gold be used to solve the US debt crisis?
Could crypto be used to solve the US debt crisis?
Could rebuilding US infrastructure, manufacturing, and productivity be used to solve the US debt crisis?
Could a combination of gold, crypto, and American industrial revitalization be used to solve the US debt crisis?
Blockchain and DLT as a fix to many of America’s economic, security & transparency issues
Meta-analysis: combining these SMEs for their take on history’s cycles
- The saeculum vs EM’s 400-year supercycle vs debt jubilees
Fin

Introduction

If there were to be one single theme or point that I wish every reader of these sh*tshow Macro posts or listener of the podcasts takes away from each or the totality of this content, it would be that hubris is dangerous at a personal level but can be catastrophic at the nation-state (or business) level if allowed to run rampant.

The most dangerous aspect of hubristic people is that, often, they are also stupid people.

Many of these stupid, hubristic people end up in positions of power not due to merit or intelligence or skills or acumen, but for a shrewd political will to backstab anyone or do/say anything to gain power.

This can be seen in national politics, global businesses, and even at the extreme micro level of politics like an HOA or hotline created by tyrants for people to snitch on their neighbors for walking a dog or letting their kids play at the park whilst fraudulent lockdowns have been enacted over a virus with a +99% survival rate.

We’re not going to dive into the psychoanalysis of why low-status people love being given the power to snitch on others, or why the rate of psychopathy and sociopathy are found more often in Fortune-level CEOs and politicians at the national level than any other population on God’s green earth.

That is not the point. The point is to help you see a larger, greater point that those of us who spend our time learning from others who are/were successful in the things that we would like to be successful in/at understand.

I’ve previously shared a handful of quotes and memes that drive this point home, but one from Socrates is probably the best for this point that I’m trying to make here:

“The only true wisdom is in knowing that you know nothing.”

On the flip side of the Socrates take, we have another from Mark Twain that I’ve shared a couple of times but is worth using to highlight the issue with hubris-filled power seekers who actually attain power:

When merging these two quotes by Socrates and Twain to find where they converge and overlap, it’s highly likely that each of us will have some personal experience of dealing with or listening to someone in the corporate or political world who dug their heels in on something as “truth” that we knew wasn’t.

For those who care more about power, control, and image more than anything else, their hubris often prevents them from looking at other information which may contradict their firmly held beliefs.

Their belief in themselves as the “arbiters of truth” or “bastion of intellect” - often purely based in hubris as well - leads them to believe that they are just smarter or wiser than everyone else, so any opinion or POV they have must be the correct one.

Whenever I encounter these hubristic yet unknowingly stupid people, I think of this bit by Louis C.K. and have a chuckle:

For a 3-year-old whose brain is still forming and whose picture of the world is still being drawn, that level of churlishness is understandable. For a 20-year-old striver, it would be worth handing them a book on stoicism or maybe giving some advice.

For a 40 or 50-year-old in a position of power, it often leads me to see them as a lost cause.

Most of our current iteration of global political leaders - not only in DC - is made up of the lattermost category, unfortunately.

There are still “Prime Movers” in the world, however, and they exist across many different spectrums of industry.

For those who don’t know this term, it was one used by Ayn Rand in her writings to describe these titans of industry whose prime directive is, “build, solve problems, figure out how to make things work, always move forward and succeed.”

While many industries across America especially have seen Fortune-level companies replace the innovators and envelope-pushing Prime Movers who built America to the empire of innovation that she is with financial wizards focused only on cost-cutting, outsourcing, stock buybacks, and gimmicks to juice their own bonuses before they bail with a golden parachute, Prime Movers do still exist.

Additionally, the media, analysis, and “news” that people turn to for insights and advice have largely morphed away from their original purpose much like the C-suites.

The unbiased and apolitical person whose sole purpose was to give us an accurate depiction of the world around us has been largely replaced by people with massive conflicts of interest, ulterior motives, or “benefactors” (that are hardly ever properly disclosed) which drives the “advice,” “insights,” or “news” that they deliver.

As the global population began to awaken to these corrupted Main Stream Media opinions and insights, however, others began to step up to fill the void and honest information vacuum that had been created.

And we would be wise to listen to them.

People often ask me how I choose my information sources and know what/who to trust, and I’m sorry to tell you that it’s not a simple process, nor is the one that built my bullsh*t detector something that can be developed overnight.

Firstly, a life spent around both some of the greatest aspects of humanity and also the worst aspects of it have given me a no holds barred understanding of just how bad it can get if “the darkness” and nefarious people are allowed to take over a society.

Due to those experiences, I often say half-jokingly that my starting point is not trusting anyone or anything right off the bat.

Trust is an earned asset for me, and you don’t get it without proving that you deserve it. My initial hypothesis with a new person is that you’re a bullsh*tter, and you have to prove me wrong and earn my null hypothesis (that you’re being honest) in doing so.

This goes equally for personal connections and sources of information.

Secondly, I have a deep understanding of how the bullsh*t game is played. I’ve read all of the books by the “godfather of propaganda” Edward Bernays. I was tasked to become the Subject Matter Expert (SME) for Behavioral Economics during my marketing days, and I’ve read just about every book on the subject by those who built the field.

Moreover, I had to figure out how to incorporate and monetize Behavioral Economics for marketing and advertising. Once you take the leap to understanding how that’s done, you grow an extremely keen sense for knowing when it’s being done to you, either directly or indirectly.

I was never a spy nor did I lead intelligence operations, but I was adjacent enough to that world that I know many of the tricks and tactics that are used in that practice.

Spending the last several years writing my first novel that merges the worlds of Unconventional Warfare (UW), guerilla warfare, spycraft/tradecraft, and the Jedburgh days of the Office of Strategic Services (OSS) has also led to a voluminous amount of reading and studying to fill the holes of information that I didn’t already possess.

Again, the “see one, do one, teach one” mantra is a powerful tool.

Like with Behavioral Economics, finding a plausible way to implement spycraft & tradecraft into my fictional novel that has clandestine teams being inserted into China, Russia, and Iran - nations that are well-known to be the most difficult to penetrate - has also helped open my eyes to how that game is played in the physical, cyber, and information realms.

What in the world does any of that have to do with the US debt crisis and how to fix it?

We’re getting there, Kemosabe.

Right off the bat, you have to appreciate all of the monied and powerful interests who don’t want things fixed.

I know that sounds crazy, but it’s reality.

There are disequilibrium agents across the totality of humanity who profit off of things not working in the most efficient or effective way possible, whether that profit be through money or power.

Others feel like they “have a good thing going,” and don’t want some new entrant coming in and finding a better, less wasteful, and more efficient way to do things. Billions of dollars worth of lobbying in DC is spent to maintain the status quo at any cost.

Did you know that there have been several bills implemented over the past several decades to make the US tax law easier for the average American to comply with? So that Mainstreet Joe who can’t afford a CPA doesn’t have to stress out every year doing his taxes?

Wanna guess how much the companies who make tax compliance software spent lobbying against it?

https://www.opensecrets.org/news/2024/02/turbotax-maker-intuit-spent-millions-in-record-lobbying-blitz-amid-threats-to-tax-prep-industry/

If you try to fix the broken thing that has earned their wealth, prestige, power, or fame, they will attack you with everything they have.

There are many such cases that can be used to highlight this, from the “war on drugs” (drugs won, by the way) to the billions poured into homelessness (yet it never gets even marginally better), world-changing innovations that are kept from the public via National Security Letters, simply asking to audit voting anomalies and seeing how many NGOs and State AGs suddenly pop up to fight against you, or being a frontline doctor (or group of doctors) during a pandemic who realizes there are cheap and effective ways to fight a virus that don’t require trillions of dollars in new spending

The people and interests who fight against fixing things often blanket the airwaves, op-eds, newspapers, social media, and even the government with astroturfed campaigns of “experts” to push their agenda.

If that doesn’t work, they mobilize gaslit youth to tug at your heart strings and scream, “BUT IT’S FOR THE CHILDREN!”

Most people don’t have the time, capacity, or background to see these tactics happening in real-time.

To see them for what they are you often need a baseline understanding of these tactics, and the available time or wide range of information sources to see how they are deployed to multiple outlets/locations at the same time, and often from the same paymasters.

Once you learn to see the strings, you begin to see them everywhere, and they “glow.”

In previous posts we’ve already gone through the many domestic, global, and supranational interests who don’t want to see the American experiment succeed, and why.

We aren’t going to rehash that here, because fixing things is the point of this post, as is helping you to understand how to ascertain if someone is giving you their honest assessment of how to do so, or if they have a hidden agenda for their “solution.”

Either a truly wise person or a real Prime Mover will understand first and foremost that they will always have much to learn, so when faced with a problem that they don’t understand, they seek others who do.

Most importantly, they listen to them with the intent of learning that which they don’t already know.

Without trying to give any political intent to this comment, this is one of the things that I most admire about Trump. I learned several years ago that his way for dealing with massive issues or problems that need expertise to solve is to bring in experts of opposing viewpoints and listen to them debate each other over solutions.

Others use varying degrees of this, but not all of us have the money or power to fly multiple experts in to help us fully apprise an issue. For the rest of us, we deal with the information and insights that we have access to.

The US debt crisis is obviously a major issue that has profound implications and which could have catastrophic consequences if not resolved.

I’ve mused about potential reasons that it’s allowed to continue unabated in several of our previous posts here, and I’ve been seeking out Prime Movers and true financial or economic geniuses who are willing to talk about potential solutions.

As with any dilemma of this magnitude, there is no “one size fits all” solution, nor have I found any one expert who seems to have the complete solution. I believe that I have found, however, several actual experts and Prime Movers who have pieces of a solution.

While we can’t all use Trump’s method and bring experts to us, we are fortunate to live in a time when access to them and their thinking has never been more available.

Once you understand who actually has the mental acuity to see and acumen to understand issues that are so large that their solutions may require centuries of data along with an understanding of what has/has not been tried for analogs in the past, you can then seek out any solutions that they may have proposed, even if not in a direct manner.

That is the purpose of this post, so let’s get into it.

The Prime Movers, Experts, and Analysts

Let me be perfectly clear and upfront about something; the following aspects and potential solutions in the post are not mine, and most of them did not come from any one source directly.

Defaulting on Sovereign Debt is Trust Never Earned Back by the Markets

Ever since the US moved away from the gold standard, the value of the US dollar has been backed by one main thing: the full faith and credit of the USGOV.

Yes, there is the petrodollar and the global reserve currency and the exporting of dollars around the world. I get that. At the end of all of those trails, however, is the full faith & credit of the USGOV as the terminus.

One thing that should have been made readily apparent to everyone in the US during the “flash crash” of the Yen, then Japanese markets, then Asian markets, then US markets in the beginning of August was the extreme interconnectedness of global markets and finance.

To be perfectly honest the global meltdown of the 2008-09 Great Financial Crisis should have taught the world that lesson for good, but many forgot those hard lessons learned already.

When the Yen carry trade began to unwind - and it’s not fully unwound yet as of the time that I am writing this - global traders in or involved in the Japanese markets began to have to unload their positions in the US markets, which put massive downward pressure on US stocks across the board.

I went into some very detailed specifics of manipulations across global markets (that are inherent within the US stock market) in Masks Off, part 2: Zero Lessons Learned from GFC, Is the Fed Battling the EU Tyrants, The Current State of Affairs, Disequilibrium and the Global Coup, and other posts that are currently categorized under the Macro Financial section of the sh*tshow Macro Substack.

I had been harping on the USDJPY currency pair and worries as the Yen blew through long-held warning signs to listeners of the sh*tshow Macro weekly prep and wrapup podcasts for months, and the resulting chaos from when it began to unwind showed our listeners why I had been banging on that drum - in part.

There is still more to be seen, however. I’ve also been harping on Japan as the largest global holder of US debt, and that when they have to flood the global markets with that debt (US Treasuries) it will bring a whole new level of pain.

Even worse if nobody wants to buy that debt as it hits the markets.

Our listeners know that there have been multiple “failed” treasury auctions over the past year, which means the signs are already flashing that the “full faith and credit” of the USGOV ain’t what it used to be.

Here’s a heads-up for those still calling and/or waiting for The Fed to cut its Federal Funds rate.

Firstly, they’ve made plenty of public statements, albeit not particularly direct ones, indicating to anyone willing to listen that they do not plan on cutting rates anytime soon (as I’m writing this another Fed Governor made one of those statements yesterday, Friday 8.9.24).

Secondly, if they were to cut rates, that US debt no longer looks very attractive to many investors around the world. You see, there’s a balance between potential risk and payoff that investors require.

With the profligate spending, downgrades of the USGOV credit rating by Moody’s, and the world becoming nervous that we won’t be able to honor our debts, a certain payoff potential is required for investors to be willing to take on those bets (that USTs will be worth the paper they’re printed on).

Higher rates make that a worthwhile bet for many, even now. Even at current rates we’re seeing “failed” Treasury auctions that can’t sell (monetize) all the debt they need. At lower rates, I (and many others) imagine that it will only get worse.

The BRICs nations have already been building their MBridge solution to completely decouple from the West’s financial systems, and between Russia and Saudi Arabia moving away from the petrodollar there are serious worries that we could be in store for very bumpy waters.

The interview with Martin Armstrong linked above is especially germane to the above point. He has “in the room” experience working with foreign leaders who, in the past, refused to allow the SWIFT global financial transaction system to be used as a political and financial warfare tool.

Obama tried it in 2008, and the head of SWIFT refused. They sh*tcanned that guy, put a yes man in charge, and started using it widely.

Russia has been working on its SWIFT alternative for quite some time based on public reporting, so it’s likely that Obama and his use of SWIFT as a weapon caused what became the BRICs alliance as an Axis Powers part deux and Russia/China building MBridge.

While you hear the chiming from “experts” that the US is now producing more oil than ever so who cares about the petrodollar, what they don’t tell you is that the US recently changed the definition of what “oil” is (in terms of economic reporting) to favor natural gas more than crude in terms of production and exports.

Just like the BLS promoting fake jobs data that has to be revised down later, the reports of how much “oil” the US is producing doesn’t actually equate to barrels of crude - they’re fudging the numbers by adding in natural gas.

Yeah, that’s how gross this election year has already become. Political animals changed the definitions of recession and oil to make it seem like their economic plans have been going swimmingly.

*Narrator’s voice: they had not, in fact, been going swimmingly

The central banks of the BRICs nations have also been stockpiling gold to a massive degree, and at current it seems that their MBridge system will offer a security that is 40% redeemable in gold, which is a pretty good indication that they understand how the world and financial stability work.

https://www.zerohedge.com/commodities/central-bank-gold-buying-through-first-half-2024-sets-record

Fiat currency, oil definitions, and gold aside, there is one massive thing that the USGOV has going for it in terms of its “full faith and credit” that no other industrialized nation has: we’ve never defaulted on our sovereign debt.

We have changed the terms in which it was repayable, as there are parts of our history in which the currency was changing amidst strife and societal change - but we still paid our debts back, albeit in a different form with the same ultimate inherent value (versus intrinsic value, which is different).

Both Ray Dalio and Martin Armstrong spent a lot of time doing their due diligence and going back into deep history for historical analogs to our current situation.

Here’s a brief (4:53) video that Ray Dalio created tracking the history of the 10 most powerful empires from the past 500 years and those who held the last 3 reserve currencies of the world.

The variables that he used to quantify his analysis are worth the watch:

In his interview, Martin Armstrong goes back to 400 BC when the Greeks defaulted on their sovereign debt. France has done so multiple times, as has Germany, the UK (Alex Mercurios adds that there are several UK defaults that aren’t widely known about), as have the Dutch and just about everyone else.

Here’s something that most of you should understand when choosing who to listen to for financial analysis or understanding. Many traders and finance pros today haven’t lived through a true market crash and bear market.

Many of their ideas of “historical analogs” are what happened 10 minutes ago or at the day’s market open.

When we’re talking about true macro forces and fundamentals, however, it’s wise to stick with the financial and economic people who go back through as much history as they can to truly understand the forces at play and how they affect societies based on certain variables and environments.

Did you know that when Julius Caesar “crossed the Rubicon” he didn’t have to even fight his way to Rome?

It happened during a credit crisis, which is one of the reasons the population was solidly on his side to change the Regime/paradigm.

We’ll get more into that below, but it can show the importance of understanding the historical variables at play when looking for true and accurate analogs.

Quite recently China hasn’t defaulted on its sovereign debt, but some of its State-owned companies have (housing, banks, etc). In case you’re not a premium subscriber listening to the sh*tshow Macro weekly podcasts, Ukraine stopped payments on its external debt in the past couple of weeks as well - thereby defaulting on its sovereign debt.

But the US hasn’t.

This is one major reason that US debt is still largely seen, despite our massive spending spree as of late and other issues, as a TINA investing environment for the world’s institutional investors - There Is No (real) Alternative.

With all of the headwinds facing against us, however, between the BRICs SWIFT alternative of MBridge, some of the world’s largest oil producers moving away from the petrodollar (Russia and Saudi Arabia), defaulting on our sovereign debt would not only send the global economy into a tailspin, but it would also likely lead to a loss of trust from the world’s largest investors that isn’t easy to gain back.

Despite what the Modern Monetary Theory (MMT) zealots want you to believe, there is a limit on what the USGOV can print and spend.

That limit is what the rest of the world is willing to buy in terms of our debt, and they are not required to go along with the fanciful games that DC lobbyists enjoy playing by pretending that the Uncle Sugar money spigot will never cease or slow down.

The world’s investors who monetize that debt for us by buying USTs have already been signaling that they feel DC’s spending is getting out of hand, which is why we get failed Treasury auctions.

As mentioned in previous posts and sh*tshow Macro weekly podcasts, Moody’s has also downgraded the US credit rating multiple times due to DC’s uncontrolled debt and spending.

If the world loses faith in and stops buying US debt, a continuation of printing money and spending leads us down the path of Zimbabwe or Weimar Germany (uncontrolled hyperinflation).

The Dangers of Having Political Animals with Zero Financial Acumen in Office

While each of the men whose interviews are linked above fit my bill for trusted sources of information on extremely high-level and wide-ranging macroeconomic issues, there is one whose experience on this topic specifically is worth listening to.

Martin Armstong has a long history of being the expert who global governmental leaders bring in to consult them for massive macroeconomic, fiscal, and monetary issues. Ray Dalio and his Bridgewater Associates hedge fund has similar experiences with global markets and leadership, but he’s far less inclined than Armstrong to discuss specifics.

Armstrong lays out his bona fides for and experience with the topic at hand in pretty good detail in his interview with The Duran linked above, and it’s well worth the watch/listen to understand his current fears regarding this issue.

As an aside, I watched the Tucker Carlson interview with Geoff Shepard for his firsthand experience and decades-long research into the lawfare-based coup against President Nixon, and the similarities between things said by Sheperd regarding DC political-based lawfare and Armstrong’s similar takeaways regarding fiscal policy is astounding.

I linked the Armstrong interview above, so here is the one between Tucker and Shepard about the Nixon coup.

I know it’s not germane to the financial side of this post as a whole, but the political aspects of this section do tie in substantially:

Shepard was a young lawyer in the Nixon white house, and over the decades since he has poured through memos, and personal notes from prosecutors in their meetings to uncover some truly disgusting things about the coup.

Notably, there are repeated instances where prosecutors, lawyers, and politicians chose to go after anyone they could to get a political win in the lawfare/coup against Nixon, while refusing to go after their political comrades.

On the financial side, Armstrong’s interview outlines many times when he has seen this same thing in DC as politics were used to determine whether something that was good for the nation would be allowed to move forward or not.

This is not very well known, but there was a point this century (in the 2000s) when he was asked to build a Sovereign Wealth Fund for the USA to replace the current social security mechanism - which is entirely invested in government bonds.

Armstrong developed an entire plan to build one, but it was voted down by Democrats because Armstrong insisted that fund managers be chosen based purely on their performance.

Democrats would only allow a fund that gave them the ability to put their friends in charge of it, regardless of returns or performance.

On the other side of the aisle, Armstrong (accurately) predicted that Reagan’s monetary policy would cause a market crash. His staffers shot down one of Armstrong’s suggestions and went with one that would debase the currency and eventually lead to a crash.

They couldn’t see how traders wouldn’t want to stay in trades that would lose them money - because the DC politicos didn’t have the financial acumen to even understand that their decisions would be costing traders money at the end of the day.

This brings up quite the interesting question, for those who are paying attention: how is it that US Congressmembers seem to be the best stock traders of all time for their money (it’s not only Nancy Pelosi), yet total morons in terms of our money (as US taxpayers)?

Yeah, real brain tickler there, isn’t it?

The answer rhymes with unadulterated corruption.

Could Gold Be Used to Solve the US Debt Crisis?

Anyone who pays attention to the financial world will understand that there are gold bugs, gold evangelists, gold haters, and everything in between. That much is a given.

Those who pay attention to gold and gold prices, along with other precious metal commodities, know that the prices are absolutely, undeniably manipulated.

This is not a conspiracy theory, although many would like you to believe that it is.

One of the many great things about gold is that its intrinsic value can be simply calculated if one wanted to do so.

Because gold is a scarce commodity, there is a finite amount of it in the world. Because of the way that gold miners work, with many of the big ones being publicly-traded companies or using their success metrics to raise money for future operations, how much of the shiny stuff gets pulled out of the earth is tracked pretty closely.

Interestingly, there’s something that Martin Armstrong mentions in his interview linked above that I’d never heard before. As a guy who has walked in the worlds of statecraft, global economics, and global finance circles for many decades, I’m inclined to believe him despite never having heard it before.

In his and Mercouris' discussion about the West wanting to take out Putin/Russia to grab all of the natural resources and gold that they have, Armstrong brings up an interesting gold fact. In his telling, the Tsarists in Russia took the gold from their stores and hid them somewhere that has never been found.

Apparently, they had a massive amount of the stuff and didn’t want it to fall into the hands of the Bolsheviks, so they hid it.

In the previous sh*tshow Macro post & podcast The Eagle and the Bear, we mentioned the gold and money that Lenin and Trotsky were sent into Russia with via German and Western industrialists, but that’s another story.

Missing Russian Tsar's gold aside, the traders, economists, and gold bugs can calculate how much gold currently exists above the earth’s crust to come at an appropriate valuation and spot price for it.

If you’re a gold investor, you may scream on a daily basis at how far off the daily spot price is versus what it should be based on these calculations.

Gold and silver are pretty unique to others like copper, platinum, and diamonds in this respect. It’s long been known that the diamond cartel keeps large numbers of diamonds hidden to create false scarcity and increased values, but gold miners raise money for their new operations so they have to be more forthcoming.

In a very “God has a sense of humor” and karmic retribution sort of way, it’s quite hilarious that China has figured out how to make fake diamonds now that are wreaking havoc on the value of legitimate diamonds held and sold by the diamond cartel.

In his interview, Tom Luongo talks about “Uncle Slammy,” which was a moniker named by one of his colleagues as to the daily occurrence of gold price manipulations within the markets.

Keen observers like Tom and his colleague have noted over the years that while it doesn’t happen every day, there are distinct periods during which the price of gold is “slammed” by large amounts of the stuff “hitting the markets” at the same time.

If you understand supply & demand, this increased “supply” drops the price/value, and helps to keep prices down.

Interestingly, as noted by Tom in the interview linked above, the markets and times at which it happens can often be an indicator of who is doing it. In previous periods it was obviously coming from the US, and now it seems to be happening at the behest of Lagarde and the European Central Bank (ECB).

The thing about gold to the average investor is that it should be seen more as a store of value than as an investment along the lines of equities. Yes, there are periods in which the value of gold appreciates rapidly, but over time its true investment value is that it holds its value.

The mantra that I’ve often heard repeated is that the same amount of gold could buy a tunic in the times of the Roman Empire or a nice business suit now. Or a home then versus a home now (well, maybe not right now).

Yes, the price of gold has been manipulated for decades, but the solutions offered by Luongo and Rickards could change that. If the US isn’t willing to do so, Luongo’s geopolitical analysis says that the rest of the world may do so anyway.

We mentioned above that the MBridge solution seems to be building a security that is at least 40% payable in gold (like a modern-day bond but using gold for repayment rather than currency), and I provided a link above to show the gold buying spree that global central banks have been on - the BRICs nations especially.

Luongo goes through this in pretty great detail both in the interview linked above, as well as in many of his podcasts and newsletters for Gold, Goats, and Guns.

One of the most interesting aspects of using gold as a debt instrument for repayment rather than currency is that nations don’t want to be sending planes full of gold bars back and forth every month to settle their tallies. Yes, they could do, but it would be a royal pain in the booty if there were an imbalance of any magnitude when the bill came due.

Rather than shipping those planes and bars, nation-states who took part in this sort of global settlement security instrument and payment system would be more inclined to invest any trade surplus into the nations that they trade with.

Take a moment to consider the inherent value of that from a policymaker and “national checkbook” holder (Congress) perspective. Imagine the political tool that planes full of gold being sent overseas to China, Mexico, Bangladesh, France, etc could have if a party in power in DC allowed our trade deficits to get too out of whack.

The closer that trade balance is to zero, the fewer planes ever have to be loaded up. The higher that imbalance, the more have to fly to settle it.

If MBridge goes forward with this gold-based repayment system, no matter what the ECB does to manipulate prices, there are going to be massive transactions occurring that peg the value of gold to something other than what “Mr. Slammy” wants.

Gold is not a debt instrument in the way that currency is within our system, where every US dollar printed immediately begins to accrue interest and debt (and not in our favor as tax-paying American citizens).

Gold survives currency collapses, is more immune to volatility than other stores of value, and has been accepted around the world for about as long as humans have written down what was going on within it (for pretty much all of recorded history).

It is something that people know and trust, as long as it isn’t being debased and corrupted as some have done in the past with coinage (as has the USA regarding the precious metal content within our currency for decades).

If the full faith and credit of the USA is shakier than it has been at any time in recent history, perhaps moving to something that is trusted, quantifiable, and being implemented across the world would be a wise move and could provide a radical change for good across our current system.

If you haven’t watched it yet, Tom reminds us in his video that there was a woman who had plans to implement something like this at The Fed previously.

John McCain and Kamabla Harris were seen high-fiving on the house floor after sh*t canning her nomination to The Fed board.

I will opt not to use the string of expletives and adjectives that I would like to use to describe those two and move on.

Could Crypto Be Used to Solve the US Debt Crisis?

Like gold, crypto has its hardcores, evangelists, naysayers, and haters.

Unlike gold, crypto also has more frauds than most industries. Sure, there have been gold con artists in the past, but there’s never been an FTX-level defrauding of investors in gold as far as I know of.

Did anyone ever figure out that FTX/Ukraine scheme that was going on that the DOJ seemed to lose all interest in?

No?

I’m sure it was nothing.

Moving on.

Also like gold, Bitcoin has a baked-in level of scarcity to it. If you’re not a heavy crypto bro, you may not know that there is a finite amount of Bitcoin that can and will ever be created.

There are a lot of ins & outs to crypto in general, and there are people who will talk your ear off all night about it if you allow them to.

To be perfectly candid, I’ve been investing in crypto on and off since I began buying the stuff when it was around $5 when I worked at UCLA post-Army. I read an article that is nearly impossible to find at this point that was the first time I had ever heard about Bitcoin or crypto.

The article was in Wired or some other tech magazine, and while the article itself was about The Silk Road dark web “marketplace for anything,” my biggest takeaway was its focus on this cool digital money called Bitcoin.

Let’s get some definitions out of the way in case you don’t know the difference:

Money: anything that can be used as a medium of value or exchange. If you barter, the items used to barter could be seen as money.

Currency: a physical form of money, often issued by a government.

While the long form of “crypto” is cryptocurrency, most would argue that its adoption is not wide enough or able to be used in enough places for regular transactions to accurately call it a currency at this point.

Cryptobros and evangelists will fight you on this.

Again, I’ve been buying the stuff since the 2010s when it took multiple transactions to get one. My first tranche was lost in the Mt. Gox hack if that gives you any indication as to how long I’ve been familiar with the stuff.

I’m not a crypto hater, by any stretch of the imagination, but I am a pragmatic realist.

The way that Bitcoin was created means that there are only a predetermined number of them that can ever exist, and it becomes more and more difficult to “mine” the next BTC as each new one is minted.

Other forms of crypto don’t typically have this baked-in scarcity, and many of the newer forms have better technology that they are based on that can be used for other things. Ethereum was the 2nd major coin, and its tech was used as the backbone for quite a few other coins.

We will get into the potential for blockchain technology (that was birthed from Bitcoin) further below.

There are quite a few “whales” who have made obscene amounts of money through crypto, and now there are even US stock market funds and ETFs that can be used to invest into crypto.

Despite this, for the past 4 years (the Biden Administration) has created an enormous amount of murkiness and questions surrounding potential regulatory moves for the industry.

This administration errs towards the Nanny State versus free market style of regulatory environment, so it’s a known quantity that they will want to regulate it as tightly as they possibly can if they get their way.

Even with that as a given, there hasn’t been much clarity on what it will look like in the near future if Biden/Harris (same-same) gets another 4 years in office. With the massive amounts of money and valuations that are currently invested into the long-term success and viability of crypto, that’s a dangerous thing to leave as an unknown quantity.

There have been 2 extremely interesting developments out of the Trump campaign, which is promising for the crypto bros as well as offering a potential solution for crypto to be used at least in part to fix the US debt crisis.

Firstly, JD Vance (Trump’s VP pick) is apparently the first to run for office at that level who holds crypto as investments. I haven’t seen too many particulars on that, but what I have seen is that he allegedly holds around $250k worth of the digital assets. What the breakdown and types are, I don’t know, but at least having those investments could be seen as an indicator to some.

Secondly, Trump has publicly spoken at the Bitcoin Conference this year, and he even said that he may consider taking the crypto that was seized by the USGOV (an enormous amount from The Silk Road shutdown) and use it to create a crypto reserve in the same fashion as we currently do with gold at The Fed.

How could this be used to help with the US national debt crisis?

To understand one solution that was discussed in Tom Luongo’s interview linked above, you have to know a little bit about crypto and stablecoins like Tether, specifically. These coins are often pegged to currency (the US Dollar), and while there have been issues in the past, they are generally supposed to stay pretty much in line with the USD.

One of the reasons that the USD stays the global reserve currency is that it exists all around the world, and nations that trade with us or use the petrodollar have a need for dollars to conduct transactions.

This often requires USD cash reserves in foreign accounts at the nation-state level, but there are smaller organizations that want to trade in/with the US that may have a harder time coming up with the dollars that they need.

In these cases, stablecoins can be acquired no matter where you are in the world and could be used by the US to maintain the global reserve currency trading status in places that may be more difficult to access actual USD.

Tom also notes in his interview that he believes Tether is being used by The Fed currently as a tool to add liquidity to the treasury markets, as that’s where the stablecoin parks its money.

This would essentially lead to the physical USDs that we use here being “domestic dollars” while others abroad with a need or desire to trade in USD would use a digital version like Tether or other stablecoins.

For those who hear The Fed and crypto being discussed in the same section, fear not - this ain’t the CBDCs that everyone is worried about. Those are a tool of the EU Tyrants, and The Fed and JPoww both have made direct comments that they have no plans to implement one here.

If you’ve not read the sh*tshow Macro post Is the Fed Battling the EU Tyrants, you should for a deeper understanding of this dynamic.

Could a Combination of Gold & Crypto Be Used to Solve the US Debt Crisis?

For all intents and purposes, I believe so.

Moreover, this is essentially what MBridge is. According to Tom Luongo, America’s option is to either get on board with this now or later, but it’s going to happen.

I will get into the Martin Armstrong addition to this below, but there’s a very important and integral factor in this gold + crypto fix that would clean up what I personally feel is a massive part of our problem: corruption.

While most people hear crypto and only think about the digital currency, the Distributed Ledger Technology (DLT) and Blockchain functionality, if implemented into the entirety of our financial system, could make financial fraud and corruption a far more difficult process.

Sure, you’ll still have people like Hunter Biden and Senator Bob “Egyptian gold bars” Menendez who find creative ways to accept bribes (allegedly - although Bob has been found guilty already), but at the macro scale DLT can make the industrial-scale corruption that plagues our nation far harder to get away with.

If you’re one who actually listens to Congressional or Senate hearings and reads the source documents rather than getting your “hot takes” from the MSM or social media pundits (I choose the former for important issues), you probably know that even when corruption is found, getting access to the documents to “prove” it when any DC power player is involved usually proves impossible.

Hey, did anyone ever figure out what happened to those reams of CD-ROMs that were found by the FBI in Jeffrey Epstein’s home that had multiple rooms wired to record audio & video?

No?

Ok then, moving on.

Even with Epstein, one of the major narrative talking points is that investigators can’t seem to figure out where his money came from, or where much of it went.

As someone who has friends that used to run FINCEN terminals and knows more than the average Joe about the backend of global financial transactions, I have to categorically call bullsh*t on this one.

When they want to, the USGOV can track just about every penny that’s entered the SWIFT system back to its origin point. The operative term here is, “when they want to.”

There’s a reason the true funding sources of ANTIFA and others have never been “found” by the FBI, DHS, etc, and that reason is not because it’s too difficult for them to track.

Blockchain, however, and Distributed Ledger Technology, provides a new type of both security and transparency.

By keeping data and information in many places across multiple nodes that are used to power the technology (yes, crypto bros, I know “power” may not be the best term to use here, but we’re talking to everyone), an auditable trail of every transaction is publicly available in multiple places.

If you try to alter the record on one node, there are multiple nodes that will exist as “proof” that the one has been altered. On top of that, altering any node on a true DLT with any decent encryption is more difficult than previous technologies.

I know of one that is in the works that is even quantum-hacking proof, which is a level so far above what currently exists that it’s like SciFi.

People running Ponzi schemes like Madoff would have auditable transactions and a much harder time keeping their grift hidden. State actor-level grift, frauds, cutouts, and astroturfing campaigns would be far harder to pull off.

If you’re like me and your mind immediately goes to the potential to use this in US elections so that every citizen has the ability to audit the election results to ensure a “free and fair” election, we are simpatico, and you are correct.

Therein lies the major issue, however, and the biggest hurdle to overcome for this becoming a solution.

As said in the introduction, there are nefarious and monied interests who would throw everything they have and the kitchen sink at this solution that would make their grifts impossible to hide in the political, business, investing, statecraft, tradecraft, media propaganda, and other domains.

Could Using Debt/Equity Swaps for Rebuilding US Infrastructure, Manufacturing, and Productivity Be Used to Solve the US Debt Crisis?

When the US went off of the gold standard in 1971, we switched from an equity-based monetary system (gold-backed) to a debt-based one (fiat). This switch had quite a few effects on the US and the world, but here’s the good news: it could be switched back.

This is one area in which all of the interviews above align, although it combines their different and separate ideas into one.

For Rickards, heavy investment into infrastructure (but for real this time and not like the fraudulent multi-trillion dollar Infrastructure Act that was just The New Green Deal rebranded), reshoring American jobs, and rebuilding the US manufacturing sector could grow the economy to the point where we are changing the numerator rather than denominator and growing so much that the debt/GDP ratio is brought back into check.

Rickards and Dalio both see the need to increase productivity to maintain a successful empire.

For Dalio, it starts further upstream. His analysis shows that education leads to technology development, which increases economic output, which increases the share of world trade, military power, the strength of a nation’s financial center, which all lead to the strength of the nation’s currency as the global reserve.

Unfortunately, we are at a point of diminishing returns in the current US public school system, so simply throwing more money at a broken system will not increase any of the variables above.

If you want to get into a political firestorm, simply propose a fix to the public education system - you will be attacked by bots, lobbyists, teacher's unions, and the politicians that they own nearly immediately.

If we want to increase the economic output and productivity of our nation while bringing back its passion for innovation, fixing the public education system is a necessary step.

Armstrong is the one who proposed the debt/equity swap, elucidating that anyone who had the political will could offer a debt-to-equity swap, taking away the debt aspect and converting it to an equity-based system for our current debt holders.

Tying this in with other ideas above, if that equity instrument also had a gold aspect, and to Armstrong’s point also required the equity to be invested into the US economy in some way (like, say, infrastructure, the manufacturing sector, public education innovation, etc), it could be a multivariate move in the right direction(s).

Both Armstrong and Luongo are not bashful in their assertions that the US Neocons are only demanding that Projects Ukraine and Iran move forward so that they can jack the resources from those countries.

As I’ve noted before, that did not work out so well in Iraq or Afghanistan.

As Armstrong notes, it doesn’t matter if they have the resources of the entire world.

These schmucks will spend more than they have no matter how many zeroes are in the account.

Meta-Analysis: Combining These SMEs For Their Take On History’s Cycles

There is another aspect to this that is discussed by every one of the brilliant minds linked at the start of this post, and one that I would be remiss without mentioning.

For wise disequilibrium agents and those who are set on the status quo, this is the thing that they should be the most worried about.

A good analyst will go as far back into the historical record as possible to look for patterns and analogs that may help to inform the current moment.

For a quote that we’ve shared before from the Biblical book of Ecclesiastes:

Ecclesiastes 1:9

The thing that hath been, it is that which shall be; and that which is done is that which shall be done: and there is no new thing under the sun.

I’ve recommended two books repeatedly that anyone who wants a good understanding of the cycles of history and human existence should read: The Fourth Turning (Strauss, Howe) and The Eternal War (Burlingame).

The Fourth Turning focuses on an 80-year cycle called the saeculum that was known to the ancients, but that our modern society seems to have forgotten about. Each of these cycles consists of 4 different 20-year “generations,” each occurring in the same order over and over again, and each with its own unique characteristics based on where that generation falls within the cycle.

One of the more interesting facts that I took away from that book is that of Mt. Rushmore; each face carved into that mountain represents one from a separate generation within the saeculum, and in chronological order.

I’ve mentioned previously that The Great Awakening religious revival occurred in the US one generation before the American Revolution; the parents who were brought back to God are the ones who raised, taught, and developed those Founding Fathers who would go on to fight for and build our nation.

Everything in our world exists within cycles to some extent, whether that be society, the stock market, real estate, technology, innovation, etc.

On top of that 80-year saeculum, EM mentions (as well as both Tom Luongo and Martin Armstrong in their interviews above) a greater “super cycle” that I’ve mentioned before which occurs every 400 years or so across the world.

These 400-year supercycles completely upend ownership and the relation between world leaders and their populaces across the globe.

As said previously, Julius Caesar didn’t have to fight his way into Rome after crossing The Rubicon because the populace was in a credit crisis. The Senators of Rome were the moneylenders in large part. When you couldn’t repay a debt, those money lenders could take your home and sell your kids into slavery.

Another of these 400-year supercycles brought us the Magna Carta in the year 1215, which held that a sovereign (King) was not above the law, that the populace had liberties, and created the jurisprudence that would become our Bill of Rights.

https://www.britannica.com/topic/Magna-Carta

I’ve documented this in previous posts, but 400 years later (the next supercycle) in the 1600s the world saw:

Jamestown founded (1607)
First Navigation Act passed (1651)
Bacon’s Rebellion (1676)
The Glorious Revolution (1688)

Among other things.

Now, I don’t know how great you are at math, but…what’s 1600 + 400?

Yeah, we’re due for another supercycle terminus.

As per the short video from Ray Dalio that I shared above, one of the great variables that leads to power changing hands with empires is a growing wealth disparity between the haves and have nots.

Caesar was allowed to pass to Rome because of one such disparity.

Human history has seen a number of “debt jubilees” (also discussed in the interview that I shared in the sh*tshow Macro post Disequilibrium and the Global Coup between Mike Green (Logica Advisors) and Grant Williams (RealVision).

These debt jubilees come only when the “haves” realize that if they don’t offer breathing room to even out the wealth inequality, that they will be forced to do so at the end of a spear, or sword, or gun.

I am certainly not advocating for any type of violence or saying that violent debt jubilees are a good thing. As Ray Dalio points out, sometimes these “haves” are wise enough to do it of their own accord before the situation becomes untenable.

I’m also not knocking free market capitalism, nor am I a proponent of Universal Basic Income (UBI). We just went through a study on the sh*tshow Macro weekly podcast that outlined how UBI was a massive failure that does more harm than good.

I don’t believe in giving anyone outside of your nuclear family “something for nothing,” as it goes against the most basic aspects of the human condition.

I have also, however, noted loudly and many times that our system, as it currently exists, is nothing even close to free market capitalism.

If you can bribe someone in DC via a lobbyist or “foundation donations” to win a large government contract, that is not capitalism, that’s cronyism and corruption.

If you can have your lobbyists write regulations that make it cost-prohibitive for any new entrants into your industry or market white space, that is not capitalism.

If you can astroturf an NGO with government contracts to drive advertisers away from free speech social media platforms, or have the FBI pay loads of money to platforms which go along with your censorious ways, that is not capitalism.

If foreign billionaires can “donate” to US political campaigns so that in return they get regulations that benefit them and harm competitors, that is not capitalism.

If you can get Federal Law Enforcement or Intelligence Community employees or cutout Private Intelligence Agencies (staffed by former Feds with active Fed connections) to spy on your competition and leak corporate espionage to you (this happens constantly), that is not capitalism.

If you have a Main Stream Media that becomes so unpopular that their viewership plummets yet government-connected companies up their advertising budgets despite the ROI dropping exponentially, that is not capitalism.

We can go on and on and on with this line of thinking, but I gather that you get the point.

“The Unraveling” is coming at us fast, and we can all feel it. There are numerous historical analogs throughout history, as noted by Dalio, Armstrong, and Luongo, for what happens when this divide between haves and have notes grows too wide.

We have utterly corrupt DC-apparatchiks wearing the skin suit of a free market capitalist system of trade, yet in practice, it is currently anything but.

We have the DOJ aiding state prosecutors in using financial terrorism to take down political competition, which not only flies in the face of capitalism but also corrupts the judicial system (with heavy aid coming through the state-funded & controlled MSM).

History has shown us the multiple levels of sh*tshow-iness that results from situations like this when left unchecked. How this is resolved, I don’t know, but it likely will be in one way or another.

Fin

It’s very easy to get sucked into the “Black Pill” and “doom scrolling” these days, and I hope that this post and the interviews linked at the start of it help to offer you a White Pill.

As long as we still have Prime Movers who are willing & able to build, and forces that are able to keep at bay the Marxists who want a centrally-planned economy run by midwit bureaucrats, there is hope.

The system has become corrupted to a degree that one would imagine impossible, but this new Great Awakening seems to be putting the midwits on full display along with their vast incompetence and inability to comprehend the real world or the human condition.

Those midwit bureaucrats will do all they can to destroy the Prime Movers (as we can see with the lawfare and regulatory terrorism launched against Elon Musk when he bought Twitter), but thankfully the true Prime Movers aren’t often influenced too strongly by midwits.

If we get into an Ayn Rand Atlas Shrugged situation where they throw up their arms and tell the midwit bureaucrats to “have at it” as they leave to build their own off-grid community, then the world is in trouble.

For us, we need to recognize the power of our brains, brawn, voices, and numbers.

Support the Prime Movers who are working towards a better future.

They are popping up all over the place, with the Silicon Valley bros openly moving towards Trump (Palmer Lucey has been in that camp long before it was cool), Elon telling both foreign and domestic governments to pound sand with their censorious and rights-violating demands, Ray Dalio + Armstrong + Luongo + Rickards helping us to see the roadmap towards fixing things, Erik Prince outlining how the USMIL and USGOV are easily fixable if the will exists, and plenty of others.

The mantra to follow in the realms of anyone with a political angle is always “care not for what they say, pay attention to what they do.”

We need to be supporting the Prime Movers who have an eye on fixing America with our voices and purchases when possible. Of the same respect, we should all be paying very close attention to the midwit bureaucrats who focus their ire and government power on destroying these Prime Movers who want to fix things.

If we can all come together to do that…covfefe (in the end, we will win).

Do not go gently into that good night.

Rage, rage, against the dying of the Light.

I’m terrible at asking others for things, but…

It’s my intention to keep this platform free to read, but with the ability for people to donate if they are so inclined and feel the content here is worth their hard-earned dollars. These posts take quite a bit of time and research, but as I work it into my routine the flash-to-bang on new posts should reduce dramatically.

If you are so inclined and feel this is worth your time to subscribe for updates, share with others, or become a paid member, I’d greatly appreciate it.

Regardless, we’re all in this sh*tshow together. I’m going to do what I can to help you see the bigger picture and keep your eyes on the things that matter.

Until next time,

RPL