Here
is what Dr. Roberts had to say in the second and final part of this
extraordinary interview: “I can point out three giant bubbles that
threaten the remains of the American economy ... When these bubbles pop, the
consequence is obvious: The wipeout of the remaining wealth from bond and stock
collapses, and a very strong domestic inflation from the rise in the import
prices.”
Dr. Paul Craig Roberts
continues...
“The United States is now an import dependent
country. It doesn’t produce its own manufactured products, clothes, shoes.
These import items dwarf the import of oil or energy. So what is the potential
for happening when these bubbles burst is widespread unemployment, and a rapid
increase in inflation, before which the economic policy has no known solution.
... It is frightening, and it shows the extent to
which the economic policy of the United States is misused in support of four or
five big banks that are ‘too big to fail’ ... We now have one bank, JP Morgan,
which has derivative exposure equal to the (entire) world’s GDP....
“Unless these derivatives all net-out in some way,
the bank (JP Morgan) has no way of covering its exposure ... When you have your
top policymakers so utterly incompetent, well, then you are going to be in a
huge mess ... So they’ve gone from one crisis to putting in place the foundation
of a much bigger crisis.
There is no way for them to avoid it unless people
think that dollars can be printed indefinitely without any effect on the value
of the dollar. But of course the demand for dollars is not growing in keeping
with the supply. So we have a potential massive crisis waiting to happen, but
you can never predict what sets something like that off.”
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