Ron Paul: "Central banks are trying to save a system that is bankrupt"

If the U.S. government continues to incur debt at this rate, people will eventually lose confidence in the dollar. That's what former Congressman Ron Paul said in an interview with Kitco earlier this week. In doing so, he responds to a New incentive program of $2 trillion that President Biden wants to implement. He also complains about central banks, which, according to him, are not that independent at all and have been conducting a failing monetary policy for years.

Ron Paul sees a failing political system, which can no longer come up with any other strategy than to distribute even more money to the population. All those debts will have to be repaid one day, which means that the purchasing power of the money will come under further pressure. People should protect themselves from that. Not only by gold and other tangible possessions, but also by gaining knowledge about economics.

Below we have written out the most important passages from the interview below. You can watch the full interview at the bottom of the article.

On Biden's new stimulus program:

"The government is convinced that debt doesn't matter. They say this is the modern money theory, but it's not modern. It's been around for a long time. It's an insane monetary theory that causes a lot of damage. That damage is building up now and will erupt one day. People will then lose faith in the purchasing power of the dollar.

They cannot continue to do this, because if they could, they would be going against common sense and against history. This can go well for a while. You can fool people for a while, but eventually these kinds of incentive programs are going to lead to a major disaster."

On the skyrocketing debts:

"Everything in Washington is done for political reasons. They have no need to promote sound monetary policy. In the past, there was an attempt to recognize that debt was bad and that a free market interest rate was better and that there were limits. But that's not there anymore. The consequences of that are terrible.

I think it started in recent years, when overnight interest rates suddenly skyrocketed in 2019. That was a signal that the system was no longer functioning. Interest rates then had to continue to fall. It doesn't make any sense, but it was all magnified by the coronavirus with the lockdown measures. This has made the economy even weaker, but we were already dealing with a very flawed system with a lot of bad investments and high debt.

Debts always have to be paid off, one way or the other. It can be paid for if people work harder or by devaluing the currency. That's paying off debt with newly printed money."

On the failing political system:

"I see a failing system. Both political parties are interventionist. They are fighting for power, but in reality they are pursuing the same policies. They are not trying to correct the mistakes of the right, who are also in favor of debt, war, and the Federal Reserve. They all vote to spend more money.

Because it is a failing system, they have to spend more and more money and hand out more benefits to the population. We are also seeing more protectionism. They think, "We're not as competitive anymore, we've got to do something about it." This also has an impact on foreign policy in the form of sanctions and import duties. There was a time, about ten to fifteen years ago, when part of the economy was more conservative about this and was not keen on import duties. But now we just do it.

In doing so, we are creating even more disruptions internationally. Look, for example, at what is happening with our foreign policy in Syria, the Middle East and Afghanistan. Afghanistan will never be finished, I think we can prepare for another twenty years. We will see the end of the dollar even sooner than we leave Afghanistan and the rest of the Middle East."

On a lack of independence in central banks:

"Central banks are trying to save a system that is bankrupt. The whole idea that they're independent, I don't believe in that. I think they're more interested in secrecy. There are people in the shadow government, the deep state, who are pulling the strings. They have a lot of power and say. I was a member of the banking committee for many years, but I was not even allowed to attend the meeting of the open market committee.

We need a thorough audit to find out what's going on behind the scenes. And after that, we need to abolish the Federal Reserve. We haven't had a central bank for a very long time. They fail all over the world. Now they are sitting together with climate panels that want something from them again.

It all distracts from whether they can maintain the integrity and purchasing power of the dollar. I don't think they can continue to do that. Sometimes they even hide the numbers that show what's happening. They can't even show the figures of the money supply yet. They don't reveal it, because it would be too complicated and not important. In the end, they agree that they should print unlimited money."

On financial and moral bankruptcy:

"It's two things. We are financially bankrupt, most people understand that. We borrow too much, we print money, and so on. But the other problem is moral bankruptcy. If you look at the attack on freedom of speech in our country and the attack on our Western civilization. That's a big problem, and that's moral bankruptcy. And that will only become more problematic in the coming years."

On the importance of knowledge:

"If people don't understand how economics works, then nothing good can come of it. All bad economic policies are the result of bad ideas. For the last fifty years, we have not had an Austrian school of economics in our education. We have Keynesian socialist policies, in which debt does not matter and there is no longer any respect for the constitution. They think that if you print enough money and distribute it among the people, everything will be fine. But that's not how it works."

Ron Paul: "People are going to lose confidence in the purchasing power of the dollar"

This contribution was made from Geotrendlines