Jim Rickards: Money Printing Will Destroy Confidence At Some Point

Monday, April 14, 2014
By Paul Martin

Gold Silver Worlds
April 14, 2014

In a recent online presentation organized by bullion service provider GoldCore, Jim Rickards explained the current economic environment and what it means to gold investors. His main premise is that central bank intervention is very destructive in the long term and that there is no economic recovery. Gold investors should keep part of their wealth in physical form, not as an investment, but rather as wealth protection.

Jim Rickards on deflation and the risk of collapse:

The system is now larger than 2008 — make the system bigger and you’re going to have a bigger collapse. We are further down the timeline.

The ultimate thesis is that deflation is the biggest problem in the world. The world wants to deflate but central banks and governments cannot have deflation – it increases the debt-to-GDP ratio, destroys tax collection, creates bad debts and hurts the banks. So central banks will do anything to avoid deflation. The way they do this is to print money. But if you print too much money then you’ll collapse confidence in the U.S. dollar.

The U.S. dollar is ultimately backed by confidence, as also said by Paul Volcker. The Fed is insolvent on a mark to market basis. I came to this conclusion himself, but insiders have also told me this privately; they won’t say it publicly.

Money is a perpetual non-interest-bearing note issued by an insolvent central bank. How long can that go on before people walk away from it?

The Rest…HERE

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