Carter-era Economist Sees Deja Vu In Barack Obama

Doug Casey‘s 1979 book Crisis Investing became the largest selling financial book in history as Americans desperately sought to survive in the disastrous economy created by President Jimmy Carter.  He is clearly one of the best men you could turn to in finding out how to survive the economic mess created by an incompetent Democrat in the White House.

So, with that in mind, it would be interesting to ask the guy who wrote the book on the disastrous Carter economy what he thinks about the mother-of-all-disastrous economies that is about to be hatched while Barack Obama sits on the national nest.

In their annual forecast edition, the editors of BIG GOLD asked Casey Research Chairman and contrarian investor Doug Casey to provide his predictions and thoughts on issues everyone’s thinking about these days. Read what he has to say on the economy, deficits, inflation, and gold…

The $1.1 Trillion Budget Deficit

My reaction is that the people in the government are totally out of control. A poker player would say the government is “on tilt,” placing wild, desperate bets in the hope of getting rescued by good luck.

The things they’re doing are not only unproductive, they’re the exact opposite of what should be done. The country got into this mess by living beyond its means for more than a generation. That’s the message from the debt that’s burdening so many individuals; debt is proof that you’re living above your means. The solution is for people to significantly reduce their standard of living for a while and start building capital. That’s what saving is about, producing more than you consume. The government creating funny money – money out of nothing – doesn’t fix anything. All it does is prolong the problem and make it worse by destroying the currency.

Over several generations, huge distortions and misallocations of capital have been cranked into the economy, inviting levels of consumption that are unsustainable. In fact, Americans refer to themselves as consumers. That’s degrading and ridiculous. You should be first and foremost a producer and a consumer only as a consequence.

In any event, the government is going to destroy the currency, which will be a mega-disaster. And they’re making the depression worse by holding interest rates at artificially low levels, which discourages savings – the exact opposite of what’s needed. They’re trying to prop up a bankrupt system. And, at this point, it’s not just economically bankrupt, but morally and intellectually bankrupt. What they should be doing is recognize that they’re bankrupt and then start rebuilding. But they’re not, so it’s going to be a disaster.

The U.S. Economy in 2009

My patented answer, when asked what it will be like, is that this is going to be so bad, it will be worse than even I think it’s going to be. I think all the surprises are going to be on the downside; don’t expect friendly aliens to land on the roof of the White House and present the government with a magic solution. We’re still very early in this thing. It’s not going to just blow away like other post-war recessions. One reason that it’s going to get worse is that the biggest shoe has yet to drop… interest rates are now at all-time lows, and the bond market is much, much bigger than the stock market. What’s inevitable is much higher interest rates.

Would you like a nice big helping of some “God damn America” with your President?  Because this is what it looks like when put into practice.  Capitalism was an invention of Christianity.  It is no coincidence that those who have been most hostile to the religious and Judeo-Christian worldview should be hostile to the capitalist system that came from that worldview and seek to impose socialism.

I would add that capitalism was most corrupted by the spirit of social Darwinism that is  the logical outcome of godless Darwinian thought (think about it: why shouldn’t the rich and powerful hoard and consume all the resources given the “survival of the fittest” and “big fish eat the smaller fish” mentality?).  And now the very people who corrupted capitalism in the first place are using the very greed and predatory mindset they introduced into the system to attack and undermine capitalism as they seek to impose socialism.

Well, at least Doug Casey is all alone in seeing all this doom and gloom coming over America, right?  I mean, surely he’s the only economic expert who sees a disaster coming, isn’t he?


Commodity Online
The man who predicted the 1987 stock market crash and the fall of the Soviet Union is now forecasting revolution in America, food riots and tax rebellions – all within four years, while cautioning that putting food on the table will be a more pressing concern than buying Christmas gifts by 2012.

Gerald Celente, the CEO of Trends Research Institute, is renowned for his accuracy in predicting future world and economic events, which will send a chill down your spine considering what he told Fox News this week.

Celente says that by 2012 America will become an undeveloped nation, that there will be a revolution marked by food riots, squatter rebellions, tax revolts and job marches, and that holidays will be more about obtaining food, not gifts.

“We’re going to see the end of the retail Christmas….we’re going to see a fundamental shift take place….putting food on the table is going to be more important that putting gifts under the Christmas tree,” said Celente, adding that the situation would be “worse than the great depression”.

“America’s going to go through a transition the likes of which no one is prepared for,” said Celente, noting that people’s refusal to acknowledge that America was even in a recession highlights how big a problem denial is in being ready for the true scale of the crisis.

Celente, who successfully predicted the 1997 Asian Currency Crisis, the subprime mortgage collapse and the massive devaluation of the U.S. dollar, told UPI in November last year that the following year would be known as “The Panic of 2008,” adding that “giants (would) tumble to their deaths,” which is exactly what we have witnessed with the collapse of Lehman
Brothers, Bear Stearns and others. He also said that the dollar would eventually be devalued by as much as 90 percent.

The prospect of revolution was a concept echoed by a British Ministry of Defence report last year, which predicted that within 30 years, the growing gap between the super rich and the middle class, along with an urban underclass threatening social order would mean, “The world’s middle classes might unite, using access to knowledge, resources and skills to shape
transnational processes in their own class interest,” and that, “The middle classes could become a revolutionary class.”

In a separate recent interview, Celente went further on the subject of revolution in America.”There will be a revolution in this country,” he said. “It’s not going to come yet, but it’s going to come down the line and we’re going to see a third party and this was the catalyst for it: the takeover of Washington, D. C., in broad daylight by Wall Street in this bloodless coup. And it will happen as conditions continue to worsen.”

“The first thing to do is organize with tax revolts. That’s going to be the big one because people can’t afford to pay more school tax, property tax, any kind of tax. You’re going to start seeing those kinds of protests start to develop.”

“It’s going to be very bleak. Very sad. And there is going to be a lot of homeless, the likes of which we have never seen before. Tent cities are already sprouting up around the country and we’re going to see many more.”

“We’re going to start seeing huge areas of vacant real estate and squatters living in them as well. It’s going to be a picture the likes of which Americans are not going to be used to. It’s going to come as a shock and with it, there’s going to be a lot of crime. And the crime is going to be a lot worse than it was before because in the last 1929 Depression, people’s minds weren’t wrecked on all these modern drugs – over-the-counter drugs, or crystal meth or whatever it might be. So, you have a huge underclass of very desperate people with their minds chemically blown beyond anybody’s comprehension.”

The George Washington blog has compiled a list of quotes attesting to Celente’s accuracy as a trend forecaster.

“The Trends Research Institute is the Standard and Poors of Popular Culture.” – The Los Angeles Times

“If Nostradamus were alive today, he’d have a hard time keeping up with Gerald Celente.”- New York Post

So there you have it – hardly a nutjob conspiracy theorist blowhard now is he? The price of not heeding his warnings will be far greater than the cost of preparing for the future now.

It is frankly amazing that only one month in to the Obama presidency, I already find myself wishing we had Jimmy Carter back.  He was just a disaster and a disgrace, after all.  Obama represents the total destruction of this country’s economy and the American way of life.  Carter brought us into a devastating foreign policy, energy, and economic crises; Obama may so undermine this nation’s political, financial, economic, defense, intelligence, and social institutions that there is little left to rebuild.

4 Responses to “Carter-era Economist Sees Deja Vu In Barack Obama”

  1. hl Says:

    “A government big enough to give you everything you want, is big enough to take away everything you have.”
    Thomas Jefferson

  2. Michael Eden Says:

    In the name of “fairness,” liberals are inherently unfair. They seize from one group of people who they deem as “evil” in a blatantly fascistic manner (demonizing the “other” has always been a hallmark of totalitarianism) to give to their “politically correct” group of people.

    But they seize from producers to give (and “give” in an incredibly corrupt, wasteful, and stupid manner) to those who don’t or won’t produce. The trend is guaranteed to punish success, reward failure, and create diminishing returns.

  3. Doug nusbaum Says:

    Would someone please tell me exactly what “investment banks” produce or how they aid production. As near as I can tell, all that they do is mis-allocate resources. And they do so in a way that is worse than what the government does.

  4. Michael Eden Says:

    The function (and benefit) of investment banks should be apparent from the Wikipedia entry:

    An investment bank is a financial institution that raises capital, trades securities and manages corporate mergers and acquisitions. Another term for investment banking is corporate finance.

    Investment banks work for, and profit from, companies and governments, by raising money through issuing and selling securities in capital markets (both equity and debt) and insuring bonds (e.g. selling credit default swaps), and providing advice on transactions such as mergers and acquisitions. A majority of investment banks offer strategic advisory services for mergers, acquisitions, divestiture or other financial services for clients, such as the trading of derivatives, fixed income, foreign exchange, commodity, and equity securities.

    So they can do good things and help an economy improve by providing capital where it is most needed.

    At the same time, investment banks can be like a pack of hyenas. They can undermine the economy. They can literally bet AGAINST growth, rather than for it, and profit from the economy tanking (by driving up prices of commodities such as oil or by “selling short”).

    We have had a steep and profound moral decline since we decided to drive God out of public life. And if there’s no God, why shouldn’t our businesses practice “social Darwinism” and prey upon a society rather than contribute to it?

    P.S. I feel the same way about the federal reserve. It was supposed to prevent the very sort of crisis that we just experienced. And not only did it FAIL to prevent the crisis; it literally helped CAUSE it.

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