ECONOVIRUS: Deflation Means Jobs & Banks to Implode – Mike Maloney

by birtanpublished on September 2, 2020

The economy continues to fall apart as GDP contracts deflation continues to accelerate as velocity slows and a few weeks ago I did a story on unemployment and I said that the official numbers were far too low that unemployment was actually much higher than that I said it

Was at least 10 to 15 percent higher well I was wrong it's far far worse than that this first story here survived survey finds 50 million Americans have lost their jobs in the past six weeks well the official numbers are 30 million

Americans losing their jobs in the past six weeks alone however that may be understating the full number of Americans who have lost their jobs by as much as 50 percent I said 10 to 15 this survey is showing 50 percent the poll

Found that for every 10 people who have successfully filed unemployment claims three or four people have been unable to register now this is due to technical issues and staffs at the unemployment office that are just completely

Overwhelmed and another two people have not tried to apply they haven't even tried and so that's four or that's three or four people plus two so you're talking five or six people so this number isn't ten it's fifteen or sixteen

That's fifty or sixty percent higher than what the official numbers are now this graph that's that's in this story is the official numbers and this is the estimate for this week the data should be out tomorrow and what it's showing

Here if you add all of these up you've got twenty six point five million and this is three point five so that brings you to an even 30 million but those are only the people that were actually able to file and get accepted for an

Unemployment claim and like I said there's a whole bunch of people that just aren't eligible and this says however epi survey indicates that an addition this is in addition to all of this eight

Point nine million to thirteen point nine million people have been shut out of the system so they are not eligible to even go and file and receive benefits moving on to our main page at gold silver I want to where I'm going to do a

Poll here and I'd like to know if you're using gold silver calm as your news page so tell us if you are or if you aren't you know this was the story that you just saw and my friend one of my best friends for and we've known each other

For more than 50 years I mean we met when we were in seventh grade and he works tirelessly literally day and night to scour the world to find you news stories that very often mainstream media will either neglect to cover or they

Will actually suppress and you know he has problems sleeping at night so he'll be up from 1:00 until 3:00 finding out what has happened in Europe and Asia while we were sleeping and then you know the rest of the day he's posting these

News stories so we just want to know is this really something of benefit to you because I think the stuff that he posts many of these stories have an impact on your life and it's good to know these things in advance on the radar Jim

Rickards says a new survey shows that of those who received the IRS stimulus checks 38 percent added to savings that's deflationary because it slows the velocity of currency those that currency is going to sit there it's not going to

Change hands in transactions and cause economic activity and causing prices to rise it's it's they're parked and that's deflationary and causes prices to fall 26 percent paid off debt that's very deflationary because debt creates

Currency and when you extinguish debt when you pay off that currency vanishes in our modern economy so this actually shrinks the currency supply and 18% planned to spend but not yet deflationary so this is all

The flashing as I warned there is no stimulus in the stimulus this is the classic liquidity trap and so and you know if you looked at that picture this is Wall Street this is the New York Stock Exchange it's empty there is

Nobody there except this one guy in a mask this is the moon and he tweets that breaking news at least a dozen Lebanese banks across the country and he's talking about in Lebanon here have been torched and vandalized in the past 48

Hours citizens are upset about the Lebanese pound falling 50% in value over the past six months now the Lebanese pound is pegged and it doesn't fluctuate up and down it just stays the same but that's

The official pound what he's talking about here this is the black market value the black market exchange rate which says you know right now pressure is building up and what's going to happen is there will be an official

Break maybe they pay at a different rate again or maybe they just lose the peg and allow the market to determine this if the market determines it this path this fall would have taken place very slowly over six months and everything

Would be fine but when this breaks there's going to be total chaos this happened to the Thai Baht in 1997 the Thai Baht was pegged to the u.s. dollar and to do that the Thai a Taiwanese central bank had to be able to

Buy or sell dollars in unlimited quantities and they had been selling dollars and they were almost out of them and when they when they started to run out they had to abandon the peg and let the Thai Baht float and what happened

Was this huge convulsion that caused something called the Asian contagion all of the tiger economies the Asian tiger economies that was the last that was the day the tiger died there were riots that broke

Out all across Asia there were people that died that got killed in these riots that spread to even to Russia where we then had the Russian bond default in 1998 and that caused the meltdown of long-term capital management which was a

Hedge fund that had bets all over the world and this upset their bets and it caused a meltdown of this hedge fund that was very highly leveraged and it almost caused the entire global financial system to freeze up and shut

Down Alan Greenspan had to arrange an emergency meeting and they were up all night long trying to figure out how they were going to solve this and keep the entire global economy from failing and he was successful by getting some of the

World's largest banks to buy up this hedge fund and slowly unwind their positions so what is happening right now in Lebanon has something to do with all of the countries that are that surround it there's going to be when this peg

Because you know it's this a government peg and when you try to manipulate something when a central bank is trying to mix for something that eventually market eventually overwhelms that another thing that's on the radar a

Scotia Bank closes metals business Scotia was four years the world's largest lender to the physical precious metals industry a history that stretches to 1684 and so they are closing this division Scotia was four years the

World's biggest lender to the physical precious metals industry with a hitch to history stretching to the founding in 1684 of London Gold dealer Mikado bullion which Scotia Bank but and they became Scotia mikata for a while there

They call themselves Scotia Bank again but what's happening here is my guess is that they are there's something coming physical delivery is getting very very difficult real gold and silver is becoming hard to find and the thing is

If you look at what's happening on the commodities exchange there is about nine contracts for each ounce of real gold and silver that is deliverable that's in the registered category deliverable at

These prices so there's basically nine owners per ounce it's a game of musical chairs there's one chair there's nine people dancing and Scotia believes that the music is about to stop I want to welcome the fourteen hundred and twenty

Two new subscribers and if you did subscribe recently if you're one of those new subscribers go back and hit that notification bell so that you the YouTube notifies you when we've got a new video we always appreciate a thumbs

Up and then you know for the new people go to goldsilver.com slash free book download my book this is the best-selling book on investing in precious metals but it's also one of the best-selling books on monetary history

Simple economics and a bunch of other stuff that will help you navigate what's happening in the global economy and you can you can spend your hard-earned currency and buy it on Amazon or you can just download it for free and send it to

Everybody you want I just want people to have this knowledge that's that's in that book the chart of the day this is GDP expansion or contraction and this is actually horrific because this is measured in quarters each year down here

There's four bars per year and what we've had is a contraction of 4.8% however this is for the entire quarter and we were expanding in January and February and the first half of March that was basically the economy in the

United States got shut off in the final week of March there are 13 weeks in a quarter so this measurement is one that whatever the gains were in January February and the first few weeks in March were offset by this much in the

Final week of March that means that the next quarter is going to be horrific you're going to get this this quarter is going to look like this one and the next one is going to be way way off the bottom of this chart it'll

Probably be the largest contraction in the shortest period of time in history because even during the Great Depression it took from the crash of 1929 until the stock market bottomed in 1932 for the full contraction to bring the economy

From a bubble into the Great Depression this is happening in just a few months this contraction here you know as I said it's one 13th of the quarter that caused this the next one is going to be huge and then it takes the February they

Haven't declared an official recession yet even though we know everybody knows we are in a recession it started a while ago and this recession is probably going to turn into a depression this contraction is it's going to take

Another it takes two consecutive quarters of economic contraction and then about a month to compile the data and release it and so you won't know until August that a recession actually started in March viewer feedback this is

From yesterday's video and Jeff Durden says eyepencil was great and showed why most Soviet which is in reality the best planned economy ever products were just just plain sucked and

They did I used to manufacture high-end audio stuff and I found a loudspeaker manufacturer that made woofers and tweeters and mid ranges and you couldn't get two from them that were remotely identical so you couldn't design a

Crossover network that would make this thing work every speaker would have had to be individually engineered it was just awful stuff they made bad cars and this was the most scientifically planned economy ever please go and watch

Pandora's Box a BBC series from a few decades ago that was absolutely wonderful in the very first episode is about the scientific engineering of the of the Soviet economy and I didn't even know I watched it a second time and I

Did I had forgotten that the leaders of the Soviet Union coming out of World War two Nikita Khrushchev Leonid Brezhnev and Boris Yeltsin were all some of the top engineers and economists that had been

Running the economy and they ended up running the entire country it would be like us having Alan Greenspan Ben Bernanke Janet Yellen and Jerome Powell as our past presidents and still their economy failed you know I want to relate

The quote of today today to yesterday's quote of the day where I was talking about how free market transactions whenever somebody does a free market transactions both parties benefit and the prosperity is raised for both

Parties today this one links to that underlying most arguments against the free market is a lack of belief in freedom itself and this is so true because the free market which is the source of all prosperity and on every

Video there's people that comment yeah but the free market this the free market that and they've got some better idea than the free market and there is no system that has ever been designed designed that brings us more prosperity

Than the free market because it's simply being allowed you and me being away you want to sell me something I want to open up my wallet and buy it that's okay that is a free market transaction when the government says oh no no no we need our

Cut the price is going up because we're gonna tax that thing by this amount this amount this amount we're gonna tax it to death or they say oh you can't do that that's illegal or they say well we've reached our quota or they say you're not

Charging a high enough price or you're charging too high a price you cannot charge that price this is going to be the price it prevents those trans actions from happening and there is no way to manipulate a market there's no

Alternative to a free market that doesn't limit your freedom I want to thank you for watching we'll see you next time

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