We Created The Conditions For Catastrophic Failure, The Big Collapse is Still Ahead!

Tuesday, January 15, 2013
By Paul Martin

By: GoldSilverWorlds
Market Oracle
Jan 15, 2013

In a recent interview with Gold Silver Worlds, John Rubino (co-author of “The Collapse of the dollar” and owner of DollarCollapse.com) explained how bad the economic fundamentals really are. The economic situation looks under control currently, but John Rubino is convinced we are now in the eye of the storm. He concludes that the longer this unbalanced situation goes on the faster the eventual collapse will play out.

John Rubino published his book in 2004 together with James Turk from GoldMoney. The main theme of the book was that governments in the US lost control over their spending and borrowing, which would ultimately result in some sort of catastrophic crisis. Debt accumulation would continue until some kind of crisis, internally or globally, would force to stop this trend. Most of the predictions have come true, but John Rubino stresses that the 2008 crisis was not the final collapse.He is convinced that the big collapse is still ahead of us.

The same trend was forecasted in the rest of the world and up until now it playing out as expected. Worldwide debt stands at $220 trillion, a figure that should be compared with the global GDP of $62 trillion. That’s a debt to GDP ratio of 350%.

The authors also predicted that money would flow out of paper assets into gold and silver as debt creation gained momentum and went public. It is important to note that gold and silver are the only forms of money that governments cannot debase by creating additional units of it.

An interesting topic is treasury bonds. They are a function of a general flight to safety. The world is still looking at US dollar denominated assets as safe havens even when the US government is taking on an increasing amount of debt. However, it is mandatory to understand that the purchasers in the treasury market are mostly central banks themselves. Their intention is to prop up fiat currencies by buying sovereign debt. What this really means is that governments are taking on too much debt and turning it into currency to cover their debt. Most people don’t see this process; it also remains underexposed in mainstream media. This process, historically, is the final stage of a country destroying its currency. Unfortunately, it is taking place on a global scale, so it will undoubtedly result in an implosion of the whole fiat currency concept.

Where do we stand today? John Rubino points to a number of important statistics since 2009 (US only) to validate his thesis and forecast of a final collapse:

The Rest…HERE

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