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The United States is running out of money to pay for Medicare and Social Security benefits for the older generation. WHY??? Partly because of the 50 million abortions since the Roe v. Wade that has wiped out the coming generations of working providers for this fund! So all you who keep on aborting babies will have to work until you die (and so will your children, grandchildren, etc.). I guess that serves you right; however, it is not fair for the ones who are against abortion. By Reba
Economics Interview Dr. Larry Bates "It's supernatural" (sidroth.org)
What really caused the economic crisis in America?
How will it affect the real estate market?
Why are gold and silver better assets than cash?
And what is the solution to the economic dilemma?
Is America at its tipping point?
Is America going to financially collapse?
Sid: I don't know a man better qualified in the natural and the supernatural to answer that question than my friend Dr. Larry Bates. He is a former bank CEO, a former member of the Tennessee House of Representatives, where he was chairman of the powerful committee on banking and commerce, Larry, the big question I have is how did we get in such a mess? This country has always done so well economically.
Larry: Well the prosperity has been a facade, you know you can cover up your largesse, the mistakes, the structural aspects, you can paper over it, pretend it is not there, but eventually you have to deal with it. We have a debt-based economy; we have a debt-based monetary system.
Sid: When you say debt-based economy, explain what you mean.
Larry: Okay back in 1913 we gave a private bank called the Federal Reserve, which by the way is neither federal and has doubtful reserves, it is a private bank that is owned by member banks, we gave them -
Sid: So if it is private, why do we call it federal?
Larry: Well, that was part of the ruse, you know in Germany one of the old banking families, Nathan Rothschild, said, "Give me control of a nation's monetary system and I care not who writes their laws." And so whoever controls the money, we read it in the scriptures Ecclesiastes 10: 19, "Money answereth all things, but the love of money is the root of all kinds of evil." So why do we get up and go to work in the morning? To get a paycheck. Why do we save for retirement? For a paycheck. What is a paycheck? It is money. Money buys us food, clothing, housing, recreation, transportation, money is central to everything we do. So if you get control of a nation's monetary system, you control everything that is going on. And thus we find ourselves in a problem because we have a lack of liquidity in the marketplace; we have more debt than there is cash. And as we have said many times, cash at the crash will be king. So this is where we find ourselves today because of the structural nature of our system. We have roughly a forty trillion dollar domestic debt.
Sid: that is almost hard for me to fathom, forty trillion dollars in debt, and you think you have problems.
Larry: But see that is not the worst part of it, we have the hedge funds, the derivatives, we estimate that the notional value, and I emphasize "notional value" is over four hundred trillion dollars.
Sid: You lost me, notional value?
Larry: Three times, three times the total domestic debt of the entire world, and this is what is unraveling right now, it is leverage upon leverage upon leverage. But lets look at the basic stuff the average person is having to face today, forty trillion of domestic debt, the federal government debt of over nine trillion, state county municipal debt, corporate debt, mortgage debt and consumer debt all put in one big pile. Now this debt is like a herd of cows, it is eating and drinking every day, it has to be serviced. So how do we service debt? With money. Then let's look at the supply of money available. And we look in the Federal Reserves data, the MZM, that is the money zero maturity, that is the broad base of money supply, it is everybody's walking around money, checkbook money plus their savings account money all put together, it is a little over eight trillion dollars. So let's do the math, subtract eight trillion of money from forty trillion dollars of debt, we have a thirty-two trillion dollar problem, as they say at NASA, "Houston, we have a problem."
Sid: So what can we do about it?
Larry: Well thirty-two trillion, thirty-two trillion of the debt, the debtors have been asked to do the impossible, pay back money that does not exist, this is why we saw the recent collapse of Lehman Brothers.
Sid: But what about the fact that our United States government is pumping money into these companies that are collapsing; is that good or bad?
Larry: Well it is neither good nor bad, let me put it to you this way, philosophically I think it is bad, but reality says that if they had not done it we would have had a total collapse of the entire US economy that would have a ripple effect that would carry through to the entire world economy. You see take that thirty-two trillion dollars, thirty-two trillion that the debtors have been asked to do the impossible, pay back money that does not exist. And so as a result one of two things will happen, we know exactly one of two things will happen, these are the parameters that Ben Bernanke the Chairman of the Federal Reserve, Henry Paulson, the Treasury Secretary had to work with. Number one if the Fed did nothing, we would have default, we would have collapse.
Sid: So they have to do something.
Larry: They have to do something.
Sid: Let me ask you, just interject this question, where does the buck stop, does it stop with the most powerful person in the United States, the President of the United States?
Larry: Well I was speaking to a conference in Singapore in March of 2008, and this was a group of bank CEO's, government officials, and corporate CEO's, we got to question/answer session and one of the people said, "If you were on the phone with Federal Reserve Chairman, Ben Bernanke today what would you tell him". I said, "Well I would ask him a question and the question is, 'Mr. Chairman, how much economic carnage are you willing to preside over'?" And the answer is "slim to none." Then I would say continue what you are doing,continue pumping in more money and credit into the economy but step it up a notch or two, because one of two things will happen, either the collapse or you will have to print more money and more credit. Now Sid, this is the economic equivalent of crack cocaine for the economy, you see it will solve your pain for a temporary period of time, but in the end you have to deal with it again. You see the solution to the problem is what caused the problem to begin with, problems begat solutions that begat new problems that begat new solutions, new problems and on and on and on. Ultimately we will have a collapse, because this thing will get bigger and bigger. The Federal Reserve quite frankly over the past five to ten years lost control of monetary policy.
Sid: So but what you are telling me is the most power is not with the President, but with the Chairman of the Federal Reserve.
Larry: That's right.
Sid: Larry, that is not a very optimistic painting, you just told us that, you said I know what is going to happen to the future of America, it is going to be one of two things, it is either going to be a collapse or it is going to be printing of money, which means big inflation.
Larry: No doubt about it.
Sid: Well, what can the President of the United States do?
Larry: Well the President can do very little, the only thing any president can do to help the economy is reduce your taxes. Now the recent Nobel Prize winner in economics at the University of Arizona, or Arizona State University in Tempe, criticized President Bush because he said he didn't ask for enough tax cuts, and I agree with him. Now we are in the political season all the time, we've had one of the longest presidential races we've ever seen in history, and we have all of these candidates that many of them are illiterates when it comes to the economy, we have one candidate that is saying I am going to lower taxes for 95 percent of the American people, well forty to forty-five percent of the American people pay no taxes, so mathematically that is impossible to lower taxes. So is the candidate talking about additional welfare programs? That's the question that I would have for that particular candidate. But in all reality the only thing the president can do is reduce the size and scope of government and reduce your taxes because here is the fundamental question for the individual, who can better spend the money in your wallet, you or some bureaucrat in Washington D.C.? Now I think that is fundamentally a no-brainer, but for those that are looking for a national nanny then perhaps there is another answer to that. But let's go back to who really runs the country. The Chairman of the Federal Reserve, whether he be Alan Greenspan or Ben Bernanke, is more powerful than any president of the United States, he determines what the average persons car payment is going to be, what their house payment is going to be, even whether they have a job or not. Sid, I submit that is total control.
Sid: Let's get a little practical right now, real estate, they say that we are near bottom and things are going to get better, what do you think?
Larry: Well they will get better, you pump enough money into the economy again, the economic equivalent of crack cocaine, you put enough for even a seasoned drug addict, and this economy is a drug addict for money infusion. See every succeeding cycle, the bubble gets bigger, a drug addict has to get a little bit bigger fix as time goes along, same thing with the economy, eventually what happens is we will have real estate prices will stabilize, I think real estate prices will stabilize in maybe twelve to eighteen months, but after that again we have a monumental task.
Sid: It is a false stabilization is what you are saying.
Larry: Oh no doubt about it.
Sid: A temporary fix.
Larry: A temporary fix.
Sid: What about HUD and organizations like that who have been taken over by the Federal government, is that good or bad?
Larry: Well you have Fannie Mae and Freddie Mac, again we forecast in our book, "The New Economic Disorder" four years ago, and our publication "Monetary and Economic Review" we said there will have to be a bailout of Fannie Mae and Freddie Mac, and we predicted that a lot of investment houses would go down. We also predicted that we would see money market funds drop below one dollar par value in the money funds. Sid, we are in a crisis, we are in one big mess. But that is the bad news. But here is the good news.
Sid: I'm waiting.
Larry: Okay, see none of what is happening here has caught God by surprise, he is not having an anxiety attack, he knew exactly what was going to happen on planet earth. What has happened is we have not pressed into his wisdom, and since we haven't pressed into his wisdom we have gone by our own manufactured wisdom thinking that we could continue to spend, tax and borrow and not face any consequences, but now the chickens are coming home to roost.
Sid: Let me ask you a couple more practical type questions, people that have money in banks, it is guaranteed, FDIC insurance, to what, a hundred thousand dollars?
Larry: That's right, two hundred fifty thousand for retirement plans.
Sid: Okay, how safe is that guarantee?
Larry: Well the FDIC can cover roughly one and a half cents on the dollar of all –
Sid: That doesn't sound safe, one and a half cents on the dollar?
Larry: When we confront the FDIC with this fact they say well that is true but don't worry about it, we have direct borrowing authority from the United States Treasury, so where does the Treasury get the money? Either tax the money, borrow the money, or print the money, you pay the cost of your own bailout. So you see this is the thing we have to understand, that when you get into a fiat money, meaning "no thing," see this is a planned situation.
Sid: Planned?
Larry: It is planned.
Sid: Who planned it?
Larry: Well let's go back, John Maynard Keynes, the architect of our current economic system, and anybody who studies economics at the high school, college, post graduate level will study Keynes in Economics. John Maynard Keynes wrote a book back in 1920 called, "The Economic Consequences of the Peace." Think about that title.
He said by continuing process of inflation, governments can confiscate secretly and unobserved an important part of the wealth of its citizens. He said there is no more sure; no more subtle way to overturn the existing basis of society than to debouch or destroy the currency. Now listen to this, he said it engages all of the products of economic law that come down on the side of destruction and does it in a manner that not one person in a million can diagnose.
Sid: Are we going to have a brand-new money system?
Larry: Very, very possibly, because if you look throughout history when currencies have failed in other parts of the world, you know the all mighty dollar, the greenback, has been for many years the reserve currency of every central bank around the world, but now a lot of people are dumping dollars, going to other currencies, dumping dollars, going to precious metals.
Sid: So are there solutions to this crisis?
Larry: Oh absolutely.
Sid: And as a matter of fact, here is a Bible scripture that says, "The wealth of the sinner is stored up for the righteous." I want to find out what we should be doing, we see what is happening right now, and we found out that our mony in banks is not so safe. How about our money in life insurance companies?
Larry: The same thing, the life insurance companies are different from banks, see as a banker I have literally created millions of dollars out of thin air with a stroke of
my pen, it is what we call PFA banking; pluck from air. Then we charge interest on that which we create out of nothing under the fractional reserve banking system.
Sid: You have to be really, here comes that Hebrew word again, you have to be really mashugah to lose money when you can do stuff like that and yet the banks have lent so
many bad mortgages they are losing money. Well they were loaning money like drunken sailors.
Sid: So how safe is our life insurance company?
Larry: Well Sid, a life insurance company can only loan out what you have loaned them. Now here is the fundamental question, if the people they have loaned your money to can't pay them can they pay you?
Sid: No.
Larry: That's right, so here we are again, we are back to money, cash at the crash will be king. And this is why we are seeing a lot of big venerable, 150 year old firms go out of business, because they ran out of cash, it was a run on the bank.
Sid: Will there be a wealth transfer and if so, how can we be the head and not the tail?
Larry: Well we know there will be a wealth transfer because the scriptures tell us that will happen, it says the wealth of the wicked will be transferred to the righteous, but here is the fundamental truth we don't need to ignore. I don't believe that God in his infinite wisdom will give people who don't understand the system; he is not going to give them a burden to handle all this wealth. And then the first thing we need to understand in all the midst of this shrinking is that our God is not a God of fear, we shouldn't be fearful. He is a God of love and of power and of a sound mind. So we have to get wisdom and understanding like the men of Issachar, they understood the times that they were living in, since none of this has caught God by surprise, we shouldn't be surprised either if we are tapped in to God's wisdom, you know we ask for wisdom from God and he says he will give it to us and he won't upbraid us for asking.
Sid: Okay, you have asked, you have been involved in money your whole life, where do you invest your money? If I can be that personal.
Larry: Oh absolutely. I have paid for agricultural real estate, I have residential real estate paid for, I have gold and silver coins and I have cash in money markets and CD's, cash at the crash will be king, I practice what I preach.
Sid: Now do you count gold as cash?
Larry: Absolutely, in fact it is the ultimate form of cash, gold and silver is money, anything else is credit. Gold and silver are the only monetary assets that aren't somebody else's liability.
Sid: You went to Asia recently and it was very interesting, they were going through what the United States appears to be going through right now, tell me about that.
Larry: Yes, we're doing during the Asian economic crisis which again was a currency crisis, much like we're facing today, ever since 1971 every economic crisis in the world has been a currency crisis, this is no exception. And I was doing briefings in seven different countries and this one particular day I was at the American club in Hong Kong, this was a meeting being put on by the Full Gospel Business Men's Group in Hong Kong, very prominent people, we had the biggest collection of tycoons I had ever been around in my life, we had the chairman of Mercedes Benz of all of Asia, we had the Lippo Group people, the Reaidos, the economic advisor to the Governor of Hong Kong, I explained how the system was working, how that God wasn't caught off guard, and he wasn't anxious about their situation, and this one Chinese gentleman said in his broken English, he says, how you know this? I now understand; how you know this? And I said well look I have no wisdom of my own, but I am tapped into the source of wisdom, and the only way you can tap into the source of wisdom of God is through an intimate relationship to the Son Jesus Christ. And I said if you are interested in knowing that see one of these men with the flowers in their lapels and they will be glad to share that with you, they told me five or six of those tycoons got saved that day.
Sid: These are some of the wealthiest men in Asia.
Larry: Absolutely.
Sid: And you know I hear religious terminology like saved, like born again, scrap it all, what counts is knowing God, hearing his voice, having no fear of death, having no fear of life, living and knowing that God, the Creator of the universe is pleased with you, living and knowing that God the creator of the universe speaks to you, what can man do for you? If God is for you what can man do to you? He can't do anything and these wealthy tycoons they just wanted to have intimacy with God.
Larry: Absolutely, because the shaking had occurred and things that they had held dear to them, their money, they saw that it was passing away.
Sid: I am reminded of Joseph. Joseph was given wisdom for the crisis that was coming before it happened. Well we are in the midst of it right now, is there still a chance to use this Godly wisdom?
Larry: Absolutely, you see we are at the tipping point, I believe we have a minimum of two years, maximum of five years to get or house in order. If we are fortunate we will have two years, if we are fortunate we may have five years, but you need to share this information with the people that you care about, because if you don't then you are going to be, you are going to have a burden. If you take care of yourself and don't share this information with other people, here is the good part about it, if you share the information of wisdom and understanding with someone who is concerned about the current situation you earn the right to share with him or her the reason for the hope that is in you.
Sid: Tell me about these three DVD's we are making available, Economic and Political Crisis, strategies for weathering any crisis while keeping your finances and political freedoms intact.
Larry: Well we go through and show people how this is not an accident, it is a planned destruction of America, it is planned, I debriefed a former KGB agent back in 1983, was with the disinformation arm of the Soviet KGB, they were spending four hundred million dollars in disinformation campaigns against the United States, I show in this DVD the blueprints and how they have accomplished the disinformation series, the disinformation period, we are now entering the destabilization period and I will show you what to look for in the destabilization period. After destabilization you come to a crisis period just like Joseph in the Bible, Joseph was raised up for such a time as this, and God is raising up modern day Joseph's to be a blessing when all of the shaking comes, we know the shaking is coming because the scripture tells us that everything that can be shaken will be shaken so that that which cannot be shaken will remain. You see money is a weapon, spiritual gifts are weapons, but we must never allow our weapon to become our identity. If we do that we have the potential of becoming a terrorist in God's eyes.
Sid: Powerful statements, you know the shaking, you don't have to be a mental giant to realize that shaking is going on, but the biggest shaking, the biggest crisis, is when you leave your temporary residence that is called your earth suit or your body, and when you slip right out of that some shall go to everlasting light and some to everlasting condemnation, everlasting is a long time. How do you go to everlasting life? By knowing the Czar Shalom, the Prince of Peace, Jesus the Messiah, because he died for your sins, if you will repent and believe that God sent Jesus to die in your place and ask him to be your Lord and live inside of you then you will have intimacy with God. If you have intimacy with God you have everything. If you have everything and don't have intimacy with God you have nothing, chose this day whom you will serve. It's God, that's who.
Get the three-DVD set, Economic and Political Crisis hosted by Dr. Larry Bates: Filmed before a live studio audience this easy to understand teaching set will give you the strategies for weathering any crisis while keeping your finances and political freedoms intact. (Can be ordered from sidroth.org)
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Economic Solutions
