The Fed Creates Crisis: Black Swan Events (Like Coronavirus) Light The Fuse
Hello everyone and thank you for tuning in to Liberty Report with me today is Chris. Rosanna are co hosts Chris. Welcome to the program. It's great to be with you. Dr Paul Good We feel good. We feel great and doing well and we're going to do our job but there's a lot of people today are not feeling well. You know the ones who have anticipated the stock market would go to the sky and lasts forever and lot of a lot of money being lost and the world is suffering from You know the The the virus The Corona virus. And of course I personally think. There's an over exaggeration of the danger of that. But that's a danger Dan. There's danger in meat. You're saying that but I think that's been overblown but the markets have been rocky and I found something interesting this week because they announced that this was the largest drop from the peak of a stock market. Ever you know like seven straight days thousand dollars a day going down. It looks like today. We'll be another down day because I I remember One of the Austrian economists. The famous ones One of the famous ones told me many many years ago. Stock markets don't crash from the peak. They usually crashed from ten percent down. And then all of a sudden recovery is evident. They don't they don't pass a certain level and they don't go back and they can't challenge the old peak but they're saying this is really the first time they've really noticed so it is unique. There's but I think this is a reflection of is not anything new or different It doesn't challenge Austrian economics. It just sort of verifies some of our concerned. This is a big bubble and this is more probably the biggest ever you know. They keep saying Oh this time it's different. It's not worried about but we were saying yeah. This time is different but it's much worse and there's there's not much joy and being Close to a predicting what's coming But this this this was a big bobble it's crack and we don't know even whether it's going to last a week a month or year because people do different things than governments do different things than central banks do different things. But ultimately the ruling comes from the individual You know players in the market so there will be a lot of mischief involved treasury and and I am F- and World Bank and and You know the the You Know Bank of International Settlements they are going to be involved and and that's hard to predict but I think the long term the major problems that bobble it was there was bigger than ever and a they kept that pump going solidly for ten years and they thought it could last forever so this this severe correction Is Is Had been expected. You know some say well. It was the corona virus. The colonel did is I think the coroner virus has something to do with it but we look at the you know the ignition because we understood distortion the bubble out there the amount of artificial credit the amount of Malan vestment that goes on the amount of debt in the world. So that is that is what people should be concentrated. Not on what precipitated you know last week's crash Oh It's around virus so all we have to do is spend. We'll print more money. Spent more money on dealing with that medical emergency and quite frankly. I think the money spent. There is just an aggravation. Long-term to the market in probably isn't dealing with the corona virus because I'm not sure they really understand everything about the corona virus and if you go by deaths being reported you should get a little bit of reassurance because there's essentially no Dasan United States and yet this flu season we've had ten thousand. Americans die from influenza and in a year it can be six hundred thousand. You know It's it's it's it's all the reaction to it and it looks like it was in the interest of some people to stir up the fear and problems. They're going on so but it's practically impossible now for the politicians or anybody else helps calm down a little bit. Let's think about it but you know what there have been a few scientists and people who were well trained in this type of problem epide- and all and they come up with some sensible Explanations but politically. It's easy to demagogue this and try to place blame on the opposition so Chris. I'm sure you've been looking at this. And looking at how the markets are going. It looks like it's been rocky and and gold has been challenged and I think that we have to keep a close eye on all the markets. That's right Dr Paul and I agree with you. One hundred percent on corona virus. Just being fused to what we've been talking about for years. Here's a breaking breaking news. The Corona virus did not create the stock market bump the federal reserved. And we've been talking about that over and over telling people that this is very bad. What they're doing because they manipulate the economy. They manipulate money. They counterfeit money and prices are the lifeblood of the economy. Prices are supposed to tell us the truth about supply and demand for every resource in the economy. People make economic decisions investments based on prices when their ally. You're making bad decisions now. When when they tell the truth are still going to be bad decisions. But they're not gonNA be a gigantic bubble like they are now and that's what the Fed has creed by interfering with interest rates by counterfeiting money. They turned the economy into a carnival. Fun House or a house. Amir's you don't know what decisions to make you have companies out there that don't make money don't know if they're ever going to make money and that's that's just fine just like during the dot com bubble that's what they do and and but because there's a economic activity You know the president walks around saying this is the greatest economy ever now. Is the greatest distortions. Ever and distortions have to be corrected. And that's when the financial crisis comes to correct all of these mistakes that the Federal Reserve has engendered right and things like you've just talked about can go on a long period of time and although Austrian economics teaches us. How to anticipate it and spot a bubble others say you know you never know. When there's a bubble but Austrian economics teaches. You can spot them but they also teach that you don't know exactly how big it'll be how much you'll lassen how people will react. And what what the central banks will do. And what the Bala Titians will do and all sorts of thing and and and what will the effect of You know a viral scare. That's going to wail wipe out half the half the population of the earth. You know all these kinds of things are are involved but you know I think what the what helped In the conventional sense Ten years ago when they had the crash in eighty nine. was Keynesian economics. At least it tidy things over. They spend more money. Run up the debt print more money and a lot of pain and suffering and we still had You know housing bubble crashes and and loss of pain and suffering but It it always is the fact that the government can take care of. What really helped todd over and got US? Another boost in the bubble Ten years ago was the fact that the dollar was strong enough to rescue it Rescue the system so the dollar printed and manipulated in the tune of trillions and trillions of dollars and things Gradually crept back down to a point where people were feeling better but hadn't solved the problem at the same time. Some people were feeling better. That the number of people who were living on the streets dramatically went up and all that did was give fodder to those individuals. See Freedom doesn't work. That's why we need socialism but the government so a long period of time have used gold as an indicator. Because that's what the market wants to use the gold the gold price. And what will people do? And I'll tell you what the government is doing. So what do they do they have to regulate gold? They have to rig the so called price of gold what was the first thing that FDR he got out of the way. We're just taking into Oracle we're not GonNa let the people vote With with their pocket book or their intuition and decide whether it should they have golden? I will make it illegal and he did that. All the way from one thousand nine hundred thirty three up to nineteen seventy-one but that that was the inner indicator but the rigging of the price lead people to believe the dollar was strong. The dollar did stay strong. It's still is strong. But they're really getting antsy right now. I'll bet they're Ansi right now. The plunge protection team. That's supposed to keep the stock market. High keep the economy booming. Take care of all the deficit to finance the welfare state finance the military industrial complex. And take care of the world with. They had had to continue. The student has one of the things that we noticed. Last week was All of a sudden when the gold price was going up too fast Somebody they identified somebody come in and dump tons of gold and it was sad and written that This was the Bank of International Settlements Central Bank for all central banks and they have a Lotta power whether they have the golden their pocket. They have a lot of clout With show the price of gold was dry dry Driven down but since then gold price came back up but now gold is under attack again. But it's in the interest of the state it's in the interest of those who have to protect the dollar you know and so the indicator is once again being attacked and and yet long-term maybe next week maybe later today. The market may overwhelm because they can't win that fight Just like they couldn't win the fight of fixing the dollar at thirty five dollars. An ounce for all those years eventually They have to K- then and that's what you don't do is when that happens. Because there's a subjective interpretation of of everybody who gets deals with and there's all competing with governments and central banks who have to rig things it's Eh there just in the business of lying they and the lies can help a whole lot like they've spent Near One Hundred Years Teaching people deficits really don't matter and printing money doesn't matter and we can we can we can rig this all and They taught people and people barely believe it doesn't matter so where are we now? The world's in two hundred and fifty five trillion dollars worth of debt and ours is sky. High I a every time. There's a problem even now. Oh Corona virus it. It's a it's a serious problem and it is. I won't deny that problem. So what do they do? What will ask the Federal Reserve Board Chairman? Is he going to help? Bail them out so they go to the Federal Reserve as if printing board digits more paper. Money is all of a sudden going to handle things you you know. I keep thinking that make sure that the market forces are there and information is available the other day I heard something where somebody you know The the travel has been impeded by the fear that exists and they were having trouble getting the products they need to keep businesses open and it was getting more complicated and then there was a criticism because somebody in the process was gouging. I keep thinking well you know. Gouging is raising the prices to show you. There's a scarcity encourage people to produce more or take more of a risk you know under these conditions so That that is the last thing you do is need more management thing and the other thing that caught my attention was the fact that right now. They're concerned the number of cases are expanding In Iran of course their way out of control in China that happens to be a system of government. That's the last Last thing for free markets. But there's a lot of people suffering there media. Ron have already been suffering for decades under the thumb the US government putting sanctions on all the time. And it's a poor country and it is now known corona virus. You know if a person is in good health. Young people don't seem to be getting it and if medications aren't available and the economy is slumping and an economic titian conditions are poor you that raises it but They would never see. Nobody wants ever talk about that. Maybe we made it tougher for some countries. Fortunately so far. It looks like we're not going to have that type of thing happened here. but I just don't think that the market is going to all of a sudden be able to The government's GonNa come in and and take care of this because you know one term that we've heard about for a long time. Is I in medicine especially first do no harm and I wish we could teach our government to do that. I do no harm right that we do. We'd live in a different world if they followed that Victim but you mentioned Dr Paul Manipulated goal because this week we were discussing. We saw pieces that were written. You know the people that really dive in and they expose this stuff while yeah I mean they. Of course they manipulate old. You know think about who were discussing here. These are people that when they campaign for office they lie. Everybody knows that when they're in office they lie. They lie about the economy. President says greatest economy. They lie about giving everything away for free. When it comes to war they lie before during and after the war. So why would anybody think that gold is off limits? They're not going to touch gold. Gold is gold. We'll stay in a market price. Absolutely not because gold is their major enemy. Gold is what If if we went back to goal this money that would put an end to all this the spending debt the worse when you think about the world wars these were major conflicts that happened with central banking Fiat money. If there was gold money there would be. How would they financing they? They can't counterfeit gold so of course they manipulate gold but manipulation as you also touched upon can only work in short term and the short term may be decades or even one hundred years because when you think of the grand scheme of things one hundred years is nothing spitting a bucket. The market always reasserts itself. The truth always wins in the end and Goldwyn. You know Chris. One interesting period time early in the after the woods ended in nineteen seventy one because in the sixties I had been reading about and studying fascinated with monetary policy and The International Gold Standard and It was anticipated even from sixty eight up to seventy one that this would happen. The Brentwood would break down. And after we got rid of about seventy percent of our gold at thirty five dollars an ounce people recognize. Hey you know it's not right. It's not working. We don't want to give up all our goal So that's when the Bretton Woods broke down but there was an anticipation before nineteen seventy-one immediately after Nineteen seventy-one people. Could I go? It wasn't legal yet Wasn't legal until nineteen seventy five. But after seventy one there was more purchase and it was sort of like legalizing marijuana. They got to appear time where they weren't throwing as many people in jail. But you weren't being arrested for for by buying gold so gold was to be legalized became legal again. January first nineteen seventy five so in one thousand nine hundred eighty four and a couple of years before gold prices keping building up and building up and on the day Gold re-legalize on January first gold was one hundred ninety five dollars and there was a lot of anticipation you know that. Wow if it's now and now the American people can buy gold Guess what happened Goldwyn? Dan went down for a whole year because a lot of people knew what was going on. So this whole idea but the one thing happened to make sure the gold price went down into sort a Diminish anybody's in enthusiasm for gold and not the dollar is is is the fact that the federal the Federal Reserve came in and interfered And the IMF they dumped gold and the Federal Reserve The Treasury Department dumped goal so the first day it was legalized gold. Prices went sharply. That's understandable but it also is a trick. It's also a lie. It was that concerted effort always to try to confuse the people to try to protect. You know the monopoly. Money the government money. And you know you you know it would work. The seventies were rough and tumble but You know body eighties dollar maintained its reserve currency and even after seven eight. They've been able to maintain but it's always them right now. That's why I think that the goal will be to make sure the metals don't do well so it doesn't mean that all the rules out you should never be considering a gold You know but long term. It should be a different way. It's also the reason that I never thought it was very smart for me to be involved in the futures market just because of the manipulation. And there's not only this effort by the governments to do it for protection of their Monopoly it's also done by people who are in the banking business and they regan tried to control the market and it's been good cases with some good people who challenged and they've won some cases in court where the they tried their regan control the silver market and the goal market is still happens but for all the I think the biggest rigging the greatest danger is when our government officials get involved a re gold and that is what I think they owe us to try to punish people who try to prove otherwise and it eventually though when they say that this is different and we were smarter now some Fed chairman. We're smarter now. We know how Greenspan was what he used to tell me he says. Yeah you're right Ron we know about we know. Buy Gold and you understand it but he told me he says but we believe that we understand this better and we can make the dollar paper system work as if it were gold Well Good Luck Ed. So he he did that. Of course it didn't didn't work And it can tide things over but the great danger of their short there. The the the Establishments you know tiding things over and helping and people say hey. It looks like it's going to be more I. It looks like it's GonNa be be working. Give us some extra time. All they do is make the bubble bigger. It is different this time. It's different than ever before because the bubble has been bigger than ever before. I don't think we've let off air. Yes for anybody to be comfortable. It's going to be rough and tumble not. Because the answers aren't there the the answer is just let things go let the bankruptcy come and go back to work and get rid of the government. Taxing system and monetary system. It's not going to happen so they're going to make it linger and that's what they did in the depression. They tried to say well. We know how to get out of a depression. And of course all they did was delay it. We didn't get out of depression till nineteen forty six. So it's is different now and unfortunately We in the free market Austrian school back in. We don't have a whole lot of say in Washington because keynesianism and socialism all our prevailing. But there's still a lot of people out there that know the difference now that their system is crashing. The biggest challenge we have is not letting those so-called Socialist get away with saying say the free market and capitalism. Gold is all bad We need to explain the difference of of Crony capitalism and keynesianism camouflaged as a free market system and And show that that's the problem and that's one introduce it. All the bubbles all the bailouts so unless we prove that we're going to end up with too many socialists. Getting involved in this next election Dr Paul. Finish up You know you mentioned. We don't have much pull in Washington but we have pulled with the people that matter and that's the people that watch our show every single day and we couldn't be more thankful for that and As Dr Paul always alludes to encloses a lot of times with his statements is the role of government. That's what the big picture is. Because no matter who you are in this world or no matter how much you have life is hard. It's constant problem solved. Now when you add government to life they make things really really hard because they multiply problems and but there could beat. There's varying degrees on how much government problems there are and that's how much they are allowed to interfere in life. They are allowed to interfere very little though. Create very little damage if they interfere a lot and we have the biggest government to ever exist on earth ever. They're going to mess things up a lot. And that's what we have. No America's founders. They wanted a government that would interfere very little. They thought at that time. It's a necessary. Evil they you know is. Is it a necessary evil? That's open for debate. But they wanted it. If you're going to have this evil to be small that it can't ruin people's liberties well that was then and this is now. They've now run roughshod on on our liberties and we but the answer is always the same to go back to having a government. If you're going to have one that is limited to these certain powers that cannot interfere with your liberty and the best way in our opinion to get that ball. Rolling is very good. Chris and I think that We can continue to make progress if we convince enough people important people especially who You know are involved in producing and spreading. Ideas is that We have to realize that People vote and do things because they believe it's in their best interest I mean why why would they? Why would they give token support to the so called Solution makers in running for the presidency right now As somebody that can offer us. Well it's free stuff if we can't prove to them that it's not in their interest to go along with free stuff Then that's our problem. We're not doing a very good job because common sense tells you and I think young people especially Respond to logic more so than people who have gone twenty or thirty years in our economic in our political system because they've been proven you have to have have management but it is in their best interest but right now You know it looks like people think that free stuff is in their best interest. Well I would wonder if that's the way the people feel in Venezuela that free stuff you were they going to get this free stop and that that to me is is the challenge and we have opportunities in spite of all the shortcomings with the Internet. our message has been getting getting out and more so by a lot of other people. I think the cinema is there and so talking about sound economic policies being the solution to the people who want a better better time. Want big middle class for instance. How do you get the largest middle-class prosperous last ever? It's under the greater the freedom the greater the middle class right now are middle. Class is shrinking but the number of people who are understanding and interested in honest up up front free market economics and sound money and limited government. Our numbers are growing. And I think that's good news and we're going to keep at it but I do want to thank all our viewers for tuning in and giving us a poor. I want to urge you to come back to the liberty report soon.