ABANDON SHIP & Let the Fed Decide If You Drown – Mike Maloney

by birtanpublished on August 29, 2020

Imagine you're on a ship that has just struck an iceberg and you know it's going down you grab the life vests for you and your family and you make your way to the deck to go to the lifeboats and you encounter some authority that is directing things and that authority is

Actively taking the life vests away from one group of people by force and giving it to another group of people and escorting them to the lifeboats deciding who will live and who will die well in this analogy the ship is the economy and

The authority is the Federal Reserve deciding who will live and who will die the Federal Reserve bails out Boeing gives three billion dollar subsidy to Carnival Cruise Lines well if you read the article they didn't actually give a

Direct three billion dollar subsidy to Carnival Cruise Lines however the things that the Federal Reserve have done will benefit benefit Carnival Cruise Lines by some figure that is in the billions but what they're

Discussing here is why the small business lending program is undergoing intense scrutiny and why the much larger Federal Reserve programs are not to put it differently Boeing just got a twenty five billion

Dollar bailout from the Federal Reserve but politicians are mad at Shake Shack and there's been a feeding frenzy among reporters about the small business lending program money is going to recognize brand names such as Shake

Shack and Ruth's Chris it's actually supposed to be Ruth's Chris there's an apostrophe s there which I always thought was sort of an entertaining name Ruth's Chris it reminded me of there was an old episode of taxi where Jim this

Burned-out hippy with half a half a brain left from all the drugs that he took it haratz a bunch of money and there's a restaurant next door Mario's that is going out of business and they all of them hang out at Mario's

They love the place so he buys Mario's and when his friends ask him what he's going to name it he says Jim's Mario's going on with the story The Wall Street Journal wrote the chief financial officer

David Bernstein calculated the company needs 1 billion dollars a month to cover customer refunds debt payments and operational costs and so the story goes on a six billion dollar bond issuance will work for six months so what happens

If a crew if cruise lines don't actually go back to normal in six months and this is one of the problems with profit this is something that's going to become a zombie company that is just going to suck up capital for forever this isn't

If if they do end up bailing out all of these types of companies then the bailouts just continue and continue because I don't know about you but I'm not planning on taking a cruise the next couple of years and what has had just

Happened is the mood the the emotion of the entire country has just shifted and they're scared and the country is also going through this deflation and huge unemployment so there's going to be very few people you know the number of people

That can afford to take a cruise is going to go way way down and so if they start down this road of bailouts they're going to have to subsidize them later in bailout who knows maybe cruises will go negative one day and they'll pay you to

Take a cruise because it's all coming out of taxpayer funds or they're creating currency it will for it but remember every dollar they create by just typing them into existence the purchasing power of that dollar comes

The minute that is spent into circulation it steals purchasing power from all other units of currency you can't just type value you can't type purchasing power you can type a measurement of value a measurement of

Purchasing power and that's the currency when they type that it steals purchasing power from all other units of currency and transfers it from you and me to the the stockholders of Carnival Cruise Lines so and that is the basic dynamic

Everywhere in large swathes of society there are corporations with stockholders employees bondholders managers and so forth but with no customers and that is exactly the situation that they are in that's true for small

Businesses getting SBA PPP FL funding and it's true for large businesses getting implicit subsidies from the Fed in other words we are in a planned economy with the Federal Reserve and Congress explicitly choosing which

Business enterprises get to continue having working capital and which do not who will survive and who is going to die they they are the ones making these decisions instead of you and me making them the way that we make this decision

Is simply by opening and opening up our wallets and voting for the things that we want and if a company like this goes into bankruptcy they go through restructuring and so somebody will buy these assets at pennies on the dollar

Yeah there's going to be a bunch of stockholders and other investors that will get hurt bondholders but it gets restructured and after restructuring it's a much more efficient business that has the potential of making a profit I

Don't think this ever has the potential of making a profit I think what you're looking at here is future scrap metal is this ship sinking or not are we if this ship does have giant gashes in it from an iceberg and it's flooding with water

Are we going to pay you know through currency printing is the Federal Reserve going to pay to keep all the bilge pumps going and try and keep this boat floating and and pump currency into it at a faster rate than its sinking by

Stealing purchasing power from all of us basically impoverishing the entire nation that's the question they're getting to say who will live and who will die a planned economy doesn't work we absolutely know that it's a fact if

It did the USSR would have come out on top and the United States would have been the entity that faded into history a related story government on the hook to forgive hundreds of billions in the Paycheck protection

Program loans and the government has no idea how they'll do it there then let me see the next obvious step for central banks making loans by printing currency is the inevitable defaults and it looks like that's exactly what the government

US government is now gearing up for with regards to the loans they made just weeks ago and are continuing to make the administration's Small Business Administration's Paycheck protection program launched its second round on

Monday which allowed lenders to issue forgivable government guaranteed government guaranteed that means we guaranteed it you and me loans to small businesses affected by the corona virus outbreak or maybe just to anyone who

Fills out an application we really don't know the oversight has been a bit sketchy to say the least thus far regardless the key element to the loan program it's hilarious to call even call them loans is the idea that loans can be

Forgiven after all if given a choice to pay back your loan or have the government forgive it which would you choose that's pretty obvious but this is true all of these loans that they're making

They're going to it's it's a bailout and the bailout comes at the expense of creating currency expanding the currency supply diluting the currencies purchasing power and stealing wealth from one group of people life vests from

One group of people to give it to another I know that this is a hard thing to do but this is the type of thing that is best sorted out by the free market yes it's brutal but you're trading off short term you're doing short term

Remedies that cause long term consequences and the consequences from all of the things that they're doing are going to be horrendous getting to our main page at gold silver calm some of the stories down here

Deflation now inflation later you know it seems like everybody is coming around to the what I wrote in my book basically and have been standing by for many many many years that we would have a real deflation one day that is what's

Happening now and it will be followed it'll take a while for the emotion of the country to turn around it's all controlled by emotion and then when the velocity of currency picks up we'll either have big inflation or potentially

Hyperinflation and I am now leaning toward hyperinflation in this next story is part of the reason why Fed faces risky inflationary divorce from the Treasury post kovat now what they're talking about here is the Fed and the

Treasury have sort of merged to get through this crisis but as we increase the national debt and the the deficits to get through this crisis the national debt is going to explode and one day the Fed needs to stop lowering interest

Rates and raising interest rates to keep inflation under control if all the currency that we're creating eventually comes back to haunt them as rising prices they have to raise interest rates and at that point it

Causes the cost of all that currency that we've borrowed the payments on that start to go up to where it's taking it causes the deficits to expand even further because more and more of the government income is being used to pay

The interest due on the national debt so basically they can't if they can't raise rates then all they can do is let inflation go haywire and we go into hyperinflation if they do raise rates the government can't function it loses

So they're backed into a corner now that is going to be very very difficult to get out of on the radar Mitch says massive drop in home buyer interest this is deflationary can virtual tours phone calls and video conferences replace the

Real thing no is the answer from real estate agents and this is a poll and what you see here is the drop in home buyer interest and 8% says barely noticeable significant drop 15% is this 77% that says it's quite

Significant to the two most clients that they work with just stopped searching for a home so seventy percent seventy seven percent of them are saying basically deflation there's a new record of three hundred and seventy five

Million barrels of oil being stored in tankers so you know several weeks ago I invested in oil tankers knowing that oil was going to crash and then when it did go negative which was unbelievable those investments have done very well since

Then I want to welcome the almost 3,700 new subscribers that's great and I just want to remind you to hit that notification bell go to goldsilver.com slash free book and download a free copy of my book the

Chart of the day this is from Ronnie stuff early Ronnie Starla probably the most important thing to know about gold the annual gold inflation rate and so this is basically the stock to flow how much gold is there above ground and how

Much newly mined gold is adding to it each year and it for they for a hundred and twenty years it has averaged one point five seven percent now compare that to the US dollar now this isn't the rate this is the amount so it's the

Amount of dollars all you have to do is look at the feds asset sheet they're their assets when the Fed creates currency they buy they have to buy something with it that's how they get it into circulation but there's so many

Different monetary aggregates that it's hard to tell what how much currency there's they're creating unless you look at what they bought with it and so the counterfeit currency into existence and they buy stuff and we're getting close

To seven trillion here now in QE one they more than doubled the amount of currency that existed so this was like a hundred and forty percent increase we're not there yet we have not doubled this amount of this amount of currency that

Was in existence but we will get there just wait it's going to I'm sorry I'm laughing if you can't laugh you gotta cry and this is really dangerous what they're doing they're just not letting the free market work

And try and balance things the economy has to go through a painful adjustment at this point in order for it to be healthy later this is like you know cutting out a cancer or something like that if they

Just feed this thing and let it grow it's gonna be bad so feed viewer feedback we put out a poll there are we in a hyper bubble where does it go from here and most people thought that it was a meltdown and a smaller percentage

Thought it was going into a melt up and you know in that video I did not explain a melt up in my book I thoroughly explained what a melt up was and what an invisible crash was in the section I read of the book I refer to it but I

Didn't define the dow going into a visit and invisible crash you know it would melt up into an invisible crash of historic proportions and what a melt up is is when this the stock market is going up or real estate or any asset

Class is going up but it's not going up at the same rate as other stuff so if you divide it by inflation what you found out was that it actually lost a tremendous portion of its value the stock market did exactly that from 1966

To 1982 lost a huge portion of its value I believe it's like the second largest crash after the 19 the 1929 to 1932 stock market crash that caused the Great Depression but the stock market was actually just going sideways bumping his

Head on a thousand points that whole time inflation when you inflation adjusted you found that it lost more than 70 percent of its value anyway so moving on watching CNBC today they showed and commented on Chipotle stock

It's valued at $800 a share they noted a bunch of free cash flow yada yada I don't know much about valuations but p/e ratio of 73 seems a bit overvalued now for anybody that doesn't know seven this is

Price earnings ratio so it's the price you're paying per share of stock divided by the earnings that that company is making per share of stock and so they're paying seventy three times the earnings of that company which is totally insane

There is no way that this so it says that it's in a bubble of you know if you watch the video from last weekend from Sunday you'll see the proof that the stock markets are still in a giant bubble the chain reaction is that is the

This is about I was showing the National Debt Clock and several other things this was a special report on Sunday if you haven't watched it watch that it's worth watching hey Mike thanks you so thank

You so much for all the content you put out I just finished reading your book and I have now ordered a hard copy to keep forever it's one of the best books I've ever read one topic that I hope you can further clarify in a future video

Is how to identify wealth cycles on our own I watched your video on wealth cycles that's the video what is a wealth cycle that I put out about three weeks ago so if you haven't watched it it's definitely worth watching I watched your

Video on wealth cycles a few weeks ago and it was incredible I would I just would like to further further I would like further clarification on how we can do our own research and ademma and identify wealth

Cycles based on value and not price well you know I'm coming out with a book on it it's going to either going to be titled wealth cycles or the last great wealth cycle and I'm going to do further videos on this and we do have a very

In-depth video on it coming out but I was thinking of coming out with a website and having some researchers constantly update this stuff for you however some of it would have to be subscription because the the website I

Have to pay people to do it and you can't just do this stuff and just make it all free without ending up going bankrupt and so part of it would be most likely be a description service there would be some

Sort of pay while you get some stuff for free some stuff would be paid but it would be to help you identify what's overvalued and what's undervalued so you can sell the overvalued thing and buy the other undervalued thing and wait

Because it's more like a no lose proposition at that point so let us know well there's a pole what do you want constant research because I am probably I've done more research about wealth cycles I believe than anybody else on

The planet and I really think that this can be of benefit for everybody but there has to be a way that it can pay for itself otherwise we can't do it you know so I'll come out with my book I'll come out with it but when it comes to

Live updates and showing you where it is right now that's something that would be a subscription service the quote of the day to say Congress spend is spending like drunken sailors is an insult to drunken sailors I'll just leave you with

That thank you very much for watching

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