History Casts A Long Shadow

If you’re confused about the economy and the impact it’s having on business, you’re not alone.? We may be witnessing the culmination of a 75-year-old argument about Economics.?

Since WWII, universities have taught two competing theories of Economics. On one side of the argument, we have the Keynesians who are proponents of using government spending to manage an economy.? On the other side of the argument, we the have the Monetarists who seek to control an economy by managing the money supply via interest rate manipulation.

By establishing this false dichotomy between Keynsianism and Monetarism the “experts” have eliminated a most viable third alternative from the discussion - Neoclassical Economics. Neoclassical Economics states that production, pricing, and consumption are controlled by free market forces including Supply and Demand.

The confusion (cognitive dissonance) that we’re confronted with today is due to an apparent failure of the Keynesianism-Monetarist system and the establishment’s attempt to rationalize mounting evidence of its failure. The establishment’s chosen mantra is that a smooth landing is possible. In fact, Jerome Powell and the Federal Reserve (“Fed”) continue to claim they can mitigate inflation while creating economic growth and low unemployment. Unfortunately, the Fed has never accomplished this since its inception in 1913.

The Fed is a de facto Keynesian-Monetarist system.? Its existence is antithetical to free-market economics. The Fed claims to be data-driven and apolitical; but, it exists so that governments can borrow huge amounts of money and pass the interest payments along to taxpayers. The myriad grants and subsidies that governments dole out to favored donors are supposed to "trickle-down" to stimulate growth and avert stagnation.

Since the pandemic, the US government has ballooned the national debt to $35 trillion (and it's adding another trillion every 100 days).? Many believe this debt can never be repaid.? If so, we may have reached a Wizard of Oz moment when the curtain has been pulled back exposing an investor class who can preserve their wealth by purchasing inflation-proof assets while everyone else must survive from paycheck to paycheck.

No matter how the media pundits spin it, inflation is not growth, dollars are debt notes, and if we judge the Keynesian-Monetarist tree by its fruit, it’s a failed experiment (and very likely a Ponzi scheme).

The last time we faced this level of economic uncertainty?was during the lead up to WWII when Germany and England tried to default on sovereign debt from WWI. Unfortunately, today is eerily similar. The Keynesian-Monetarist scheme appears to be at a dead end and the debtors appear to be pushing us toward World War III, which they hope will once again allow them to default on their sovereign debt.?

So….? If you’re wondering why you’re seeing a slowdown in business alongside rising inflation, take a good look behind the economic curtain. When you invite a debt-based fiat currency into a closed system of Supply and Demand, you are inviting a vampire into your home. The result is potentially disastrous manipulation of your economy by unseen powers that control your monetary policy.? Now that the Keynesian-Monetarist powers appear to be facing a checkmate, they seem to be reaching out to overturn the chessboard.

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