We are developing the social individualist meta-context for the future. From the very serious to the extremely frivolous... lets see what is on the mind of the Samizdata people.

Samizdata, derived from Samizdat /n. - a system of clandestine publication of banned literature in the USSR [Russ.,= self-publishing house]

Samizdata quote of the day – a further exploration of ponzi economics

The state does not provide stability in such a case but rather the sort of mono-culture that makes systems unstable and takes them all down at once in a paroxysm of fiscal failure. As ever, the mantra of “too important to be left to free markets/the people” is the most towering of lies. the comfort of one’s retirement is far too important not to be.

El Gato Malo

10 comments to Samizdata quote of the day – a further exploration of ponzi economics

  • Bulldog Drummond

    We’re in a doom spiral and like in 1979, we’ll have to be circling the drain with rats in the streets before the next Thatcher can actually take power.

  • Steven R

    I don’t know how it is in the UK, but so long as money is backed up by nothing, the Federal Reserve can turn the printers on, Congress and state legislatures can write checks, deficit spending is a thing, and people can vote, we are never getting rid of entitlements.

  • We’re in a doom spiral and like in 1979, we’ll have to be circling the drain with rats in the streets before the next Thatcher can actually take power.

    Just stay wary of hard-to-see monsters and you should come out of it OK.

  • bobby b

    He’s correct about the failure of entitlements, but it’s going to need a long slow buffering period to get rid of them. Too many people didn’t squirrel away their money privately because they were assured SS and MC would take their money and do it for them. And so they let their money be taken.

    Full SS is almost – almost – enough to live poorly on. If that’s all someone has, and the system is yanked, we’ll be paying their welfare benefits anyway, and it will likely be more expensive.

    We need to start phasing it out now, starting with young people who still have time to privately throw wealth into the compounding pot early.

  • JohnK


    Fiat money can indeed be made at will by the government. But fiat money cannot create value or worth. When $1 million buys a loaf of bread people may begin to see that.

  • Steven R

    Clearly, but the point remains that even once the economy has collapsed to the point that a wheelbarrow full of dollars can buy a loaf of bread, we still won’t take a long, hard look at what’s going wrong and correcting it simply because the half of America that takes more than it produces gets to vote too.

    Universal Suffrage was a mistake.

  • Roué le Jour

    bobby b,
    Good luck getting people who are struggling with their grocery bills to save for their retirement. In our brave new world there are only two ways to have a comfortable old age, work for the government or take your social security and move to somewhere cheap.

    Steven R,
    It should be self evident that democracy requires an homogeneous demos, people who all want the same thing, i.e. a free and prosperous society, but differ in how best to achieve it. Universal suffrage is just “our gang is bigger than your gang so you have to do as we say.”

  • Paul Marks

    Even the relatively conservative President Taft got the key monetary and financial question wrong.

    He stated the problem was lack of “flexibility” – in reality the problem (not the solution) is “flexibility” – and the more “flexible” the system is made, the worse the mess is.

    The further money gets away from a physical commodity that the people have chosen to value before-and-apart-from its use as money, the worse the money is (the link between the Swiss Franc and gold went in 2000 – so all currencies are just whims, fiat-command-order, of the state and the bankers now – the monetary system is a vast criminal scam).

    And the further away the financial system gets from Real Savings (the actual sacrifice of consumption) the worse the financial system is – till we end up with what we have now, a “Cantillon Effect” world (although on a scale that Richard Cantillon could not have imagined in his worst nightmares) where the economy is controlled by Credit Bubble banks (who create “money” from nothing – nothing at all) and Corporate entities such as BlackRock, State Street and Vanguard – which “own” each other, and control many TRILLION Dollars worth of shares.

    The economic system the West has now is no longer anything to do with Capitalism (one can have Capitalism without real Capital), no longer anything to do with a Free Market.

    I strongly suspect that the death of even a semi free economy (semi free – it was never totally free, but it was vastly better than the mess we have now) has a lot to do with the death of a free society – the decline of Freedom of Speech and-so-on.

  • Paul Marks

    As for the “Entitlement” schemes that the article talks about.

    Yes – there are no real investments backing these old age and health benefits – just government IOUs.

    The American government already owes some 34 TRILLION Dollars – even totally excluding the liabilities of the “Entitlements”.

    The government of the United States, and the governments of all other Western nations (including Switzerland since 2000) is totally dependent on the fiat money and credit bubble financial system that I have already dealt with.

    The establishment elite know this utterly insane system will collapse – but they are not preparing to return to sanity.

    On the contrary – the international establishment elite is preparing to “double down” by creating an international fiat currency linked (as it would have to be) to a totalitarian system of control over all aspects of the lives of ordinary people. In line with various “Agendas” that have been pushed since at least 1992.

    In spite of their very real faults such people as Pope John Paul II, Prime Minister Margaret Thatcher, President Ronald Reagan and CIA Director William Casey (yes even the CIA Director) had a sort of basic belief in Western principles, or some shadow (remnant) of them – some basic regard for individual liberty and national independence.

    But these people are long dead – and if any leader steps out of line now the international establishment deals with them, as both President Trump and Prime Minister Truss found out.

    The international establishment (“international community”) are determined that all national independence and all individual liberty (at least for ordinary people) is to be snuffed out.

  • Paul Marks

    Even totally excluding all “entitlement” liabilities (for old age, health and so on) the Federal debt alone is over a quarter of million Dollars per taxpayer. Add personal and Corporate debt (as well as State and local debt) to that.

    Do you, Mr Taxpayer, have, say, 300 thousand Dollars down the back of the couch? No? I thought not.

    Talking about cutting this or that is, at this point, irrelevant – open or disguised default is inevitable.

    The end of the monetary and financial system is inevitable – the conflict is over what will replace it.