Never Underestimate the Desperation of a Broke(n) Government
BY MARTIN ARMSTRONG 01/06/2012
Editor's Note: Martin Armstrong, a worldwide renowned economist, recently shared his views on a number of alarming trends taking place in the U.S. and around the world. Here are some key excerpts from his recent interview:
"We’re in a situation where the budget deficits are just blowing out, and its going to get much worse. And so what’s happening is that instead of dealing with the issues the government is going to be much more aggressive to tax people, chase them down, and put them in prison. All kinds of crazy stuff. This new act that came in December 19th—effectively they are telling any foreign corporation that they must report any activity with an American overseas. And what they’re going to do to them is what they did to UBS. If they don’t comply, they will confiscate all their assets here. So, honestly, from an international perspective, the best advice I could tell people is to get out. If you’re going to do business in the United States, use an agent. Get your branches out of this country. It’s going to get far worse."
"This is exactly how Rome collapsed. There was a Roman Emperor, Maximinus in 238 [AD], he simply declared all wealth in the Roman Empire to be his. That’s it. And, what happened, is that, and what you’re going to see over the next few years, as you attack the rich, as the Romans did, what happens is that, somebody now hoards their money. They no longer invest it, they hide it, and they don’t keep it in banks. And consequently, that reduces the velocity of money. And as it reduces the velocity that is what creates the economic decline. So that interest rates, even during the Great Depression, fell to 1%, nobody would borrow because they didn’t see an opportunity to make money. And every possible mistake that every government has made before us, we are following step by step."
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Never Underestimate the Desperation of a Broke(n) Government | Martin Armstrong | FINANCIAL SENSE