In a recent interview with Liberty and Finance, economist Phil Low, founder of the Bitter Draft on Rumble, delivered a stark warning about the global financial system. Low predicts an imminent "crack-up boom," a necessary full gold revaluation, and a societal descent into immorality fueled by inflation. His analysis, rooted in Austrian economics, paints a grim picture.
Low, introduced by mutual friend Rafi Farber, expressed his conviction that current market trends are validating his long-held theories. He pointed to the draining of gold and silver from the London Bullion Market Association (LBMA) and the unprecedented physical deliveries from the COMEX as signs of a system under severe stress. "Things are playing out rather dramatically in our financial world," Low stated. He emphasized that the COMEX, "was never intended to be a vehicle for physical delivery of metals but that's what it has turned into because people are and countries and etc. are grabbing their gold and silver."
Low directly addressed the US Strategic Gold Reserve and its valuation, dismissing a "mark-to-market" adjustment as "doomed to failure." He argued that only a full gold revaluation can correct existing distortions. He explained that the dollar functions as an unredeemable note for gold at $42.22 an ounce, using a "temporarily closed" restaurant analogy to illustrate the disconnect between the dollar's nominal and gold's real value.
He asserted gold is the true "price matrix," and the manipulated dollar has caused significant distortions. Low warned that revaluing gold from $42.22 to $3,000 would trigger hyperinflation, leading to a 71-fold increase in prices, which he described as "the land of $250 gasoline." He also predicted the spot price of gold would skyrocket to $30,000 to $50,000, and stated that partial revaluations would fail. "When you understand what gold is, it is a note," Low stated, emphasizing the disconnect between the dollar and its backing. "To revalue the dollar against gold is to reprice everything in gold terms."
Low detailed signs of an approaching "crack-up boom," a hyperinflationary panic. He outlined debt saturation, the inability to accrue more debt, leading to bank failures. He also mentioned the Fed's loss of control, with interest rates rising despite attempts to lower them. Low highlighted the Federal Reserve directly buying Treasury bills, indicating a vertical money print, and visible shortages of commodities like gold, silver, lumber, and oil.
"The thing that people will notice on the ground is resource scarcity," Low warned. He described how citizens will rush to buy necessities in bulk, saying, "Everybody on Earth becomes a prepper overnight." He predicted the final stage where people discard currency for any asset.
Low connected inflation to societal breakdown and immoral behavior, arguing it distorts the "price matrix." He explained that inflation causes money to slosh around, funding bad ideas and causing a decline in values. He argued that the relentless search for yields prevents saving, making it difficult for young men to attract mates, and leading young women to destroy their future prospects.
"Inflation distorts the price matrix because it inflation causes money to be sloshing around everywhere or derivatives of money," Low explained. "The discipline required to save in any form whether you're saving money whether you're saving you know yourself and your virtue and you know building yourself up to be a better person it breaks down and Society becomes hedonistic and ultimately quite feral."
Low added, "The good news that I want to leave people is the bust quickly restores reality and savings are once again encouraged and then Prosperity can be rebuilt."
Low's interview paints a concerning picture of a financial system on the edge. His insights into gold revaluation, hyperinflation, and the societal impact of inflation offer a crucial perspective. His analysis emphasizes the urgency of a fundamental reset, suggesting only a full gold revaluation can restore stability and avert a meltdown.
Watch the full interview:
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