The Financial System Is Rigged!! You Need To Know The TRUTH!!
Published: 2023-09-21
Status:
Available
|
Analyzed
Published: 2023-09-21
Status:
Available
|
Analyzed
Predictions from this Video
Incorrect: 0
Prediction
Topic
Status
The speaker believes the financial system is rigged and will explain why.
"the financial system is rigged but not in the way you might think"
Pending
Governments and corporations are choosing inflation to devalue debt rather than defaulting, negatively impacting the public.
"in short corporations governments and the people in power have trillions possibly quadrillions of dollars of debt that they can't possibly pay back they can either default and lose everything or devalue this debt through inflation and keep it under control through regulation obviously and to our Collective detriment they've chosen the second option"
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Money is defined as a store of value, while currency loses value over time.
"money as being a store of value meaning that it holds its value over time by contrast currency is not a store of value meaning that it loses its value over time"
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Gold has historically been a good store of value, as evidenced by the relatively stable prices of assets like houses and cars when measured in gold over recent decades.
"gold has been recognized as a form of money for thousands of years gold is one of the best stores of value out there so much so that if you measure the prices of things like houses and cars in Gold terms their prices actually haven't changed that much in recent decades"
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The apparent parabolic increase in prices for assets like houses and cars is due to the devaluation of currency, not an increase in intrinsic value.
"but when you price things like houses and cars in currency terms it appears as if their prices have gone parabolic in recent decades"
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The suspension of dollar convertibility to gold in 1971 allowed governments and central banks to freely increase currency supply.
"in 1971 when then U.S president Richard Nixon quote temporarily suspended the ability for people to redeem their US dollars for gold what this meant in Practical terms was that governments and central banks were free to create as much currency as they wanted"
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Increased currency supply leads to decreased currency value, explaining the rise in asset prices in nominal terms.
"as basic economics dictates the more of something there is the less valuable it becomes as such it's not really the prices of things like houses and cars that have gone up in reality it's the value of the currencies that have gone down"
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Inflation hinders the ability of individuals to store value in currency and promotes overconsumption, which is detrimental to the environment.
"in practice however inflation is making it harder and harder for people to store value in currency and it's incentivizing over consumption that ultimately damaging the environment"
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The time value of money is being manipulated, which is the second reason for the rigged financial system.
"the second reason is manipulation of the time value of money"
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Central banks disrupt the natural supply and demand forces that determine interest rates by manually setting them.
"under normal circumstances interest rates on loans are determined by supply of lending and the demand for borrowing... However with central banks in the mix this Market Dynamic is disrupted that's because central banks can manually set the interest rates on debts"
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Following the 2008 crisis, central banks began manipulating longer-term interest rates by purchasing long-term government debt, thereby lowering interest rates across various durations.
"in response to the 2008 meltdown central banks took the unprecedented step of manipulating longer-term interest rates for the first time in modern history they did this by buying long-term government debt this had the Practical effect of lowering interest rates for similar durations of debt"
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The artificial lowering of borrowing costs has disproportionately benefited certain individuals and institutions, rather than making credit accessible to everyone.
"it didn't become easier for everyone to borrow it only became easier for certain individuals and institutions to borrow"
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Easy access to credit for select entities has inflated asset prices while the currency itself depreciates.
"this caused the prices of these valuable assets to rise sharply in currency terms all while the currencies themselves have continued losing value"
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Economic productivity in G20 countries has shown negligible growth since 2008.
"the actual economic productivity in G20 countries has been almost flat since 2008."
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The Dodd-Frank Act, a lengthy piece of legislation, has made it harder for smaller banks to provide loans to small businesses and individuals.
"the Dodd-Frank Act is over 2 000 pages long but the tldr is that it made it more difficult for small Banks to give small loans to small businesses and individuals"
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Compliance with ESG (Environmental, Social, and Governance) criteria, influenced by entities like BlackRock, can lead to more favorable loan terms and lower interest rates.
"if you comply with BlackRock's ESG ideology you'll likely get a loan with a lower interest rate and more favorable terms than if you're deemed to be non-compliant"
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In response to the 2020 pandemic-induced flash crash, central banks unprecedentedly began purchasing corporate debt.
"central banks took another unprecedented step in their response to the pandemic flash crash in 2020 and that was to buy corporate debt"
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Access to credit is increasingly determined by size, with wealthy individuals and large institutions receiving more favorable terms, which further amplifies their wealth and influence.
"your access to credit is increasingly dependent on your size if you're a wealthy individual or a big institution you'll have access to credit on more favorable terms and that will only further increase your wealth and size"
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Central Bank Digital Currencies (CBDCs) are seen as a tool for entities to gain complete control over currency.
"they will allow them to control all the currency"
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Entities with significant debt are actively promoting inflation and controlling currency flow to avoid defaulting.
"entities that are massively in debt are trying to cause inflation and control the flow of currency so that they don't default on their debts"
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There is a possibility of a return to a gold standard in the future.
"all those people talking about a return to something like a gold standard could be proven right in the end"
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