Empire of Debt

The New Rome Were you forwarded this email? [Sign-up to The Daily Reckoning here.]( [Unsubscribe]( [Daily Reckoning] Empire of Debt - Inflate or die… - A funny way to run an empire… - “When the money goes, everything goes”… Recommended Link [Urgent Note From Jim Rickards: “You’re Running Out Of Time!”]( [Read more here...]( Your exclusive “Pro level” upgrade to Strategic Intelligence is ready to be claimed. This is your chance to claim 3 exciting new benefits along with a whole new level of service. Hurry… you only have until the timer hits 0 to act. After the timer runs out, you’ll forfeit your chance to upgrade… and you may miss out. Please don’t waste any time. Just click below to see how to confirm your upgrade: [Claim Your Upgrade Here]( San Martin, Argentina March 26, 2022 Editor’s note: Many comparisons have been made between the U.S. and ancient Rome. Today, our co-founder Bill Bonner shows you how the U.S. is following Rome’s road to monetary destruction. [Bill Bonner]Dear Reader, “Live in harmony; enrich the troops; ignore everyone else,” said the Roman Emperor Septimius Severus, in his last words to his sons, Geta and Caracalla. As you probably know, the Fed is caught in an “inflate or die” trap. It either lets inflation rip — with more money printing and ultra-low interest rates — or it crashes the economy with higher rates and QT (quantitative tightening). Most people — about 90% of the population – gain nothing from inflation. But a few people — the 10% at the top — need more money printing to fund the U.S. budget, Wall Street, the military and their own bubble-era gains. These people, the few, are those who control Congress… and the Fed. The Fed knows it ought to tighten up… but it is desperate for an excuse not to. Here, at Markets Insider, is economist Mohamed El-Erian giving them one: Top economist Mohamed El-Erian said the Federal Reserve won't be able to tighten monetary policy as aggressively now that Russia has invaded Ukraine. Many on Wall Street expected several Fed rate hikes in 2022, starting with an increase of 50 basis points next month. Earlier this week, JPMorgan even predicted nine interest rate hikes this year of 25 basis points each time. "This takes 50 basis points completely off the table," El-Erian told CNBC Thursday morning. "It takes the eight, nine hikes a lot of people were talking about for this year off the table, and thankfully so... I didn't think the U.S. economy could accommodate and live with such slamming of the brakes of monetary policy." Recommended Link [Space ad Headline]( You’re going to want to [see this]( — America’s #1 futurist just came out with a stunning new prediction for what could happen in 2022. And surprise, it’s got nothing to do with Trump. Or trade wars. Or the ongoing gyrations on Wall Street. In fact, this could be your one chance to ignore all that upsetting “fake news” … and get back to the business of getting exceedingly rich instead. It’s all in the forecast you’ll find at the link below... [Click Here Now]( Two and a Half Centuries of Invasion Oh… what a wicked world! Now America’s misbegotten foreign policy is being teed up as a reason not to abandon its misbegotten monetary policy. Americans ‘march to the sound of cannons;’ they are always ready to join the fight for freedom… for justice… and for the American way. Sometimes we invade foreign nations in order to protect the existing government. Sometimes we invade to change it… often claiming to ‘build democracies.’ Dr. Gideon Polya counted 70 different times the U.S. invaded other nations since 1776 — or about once every 3–4 years. So, why get upset with Russia when it invades the Ukraine? Public policy is always mush. Foreign policy is particularly mushy. How do we know what is going on in Afghanistan or the Ukraine? But in today’s world, America’s foreign policy depends to a large extent on its mush-headed monetary policy. The advantage of foreign policy over domestic policy is that the damage is mostly inflicted on foreigners. But Americans suffer, too, probably more than they realize. Taken all together, the cost of meddling in other countries’ affairs is headed towards $1 trillion a year – or more than $10,000 per household (by our rough, back-of-the-envelope calculation). If voters were asked to pay for it honestly, they would surely refuse. In our book (written with Addison Wiggin) “The Empire of Debt,” we looked at how the US has never quite gotten the hang of running an empire. It’s supposed to be a paying proposition. You invade, you steal, you enslave… and you end up richer. That was the formula used by the Romans, successfully, for hundreds of years. But the US invades… and then turns its bombed-out target into a money pit – dumping in billions of dollars to support the local warlords… propping up the economy… and donating billions more to its own military/surveillance industries. Overseas, local hustlers and criminals get rich. And Swiss bank accounts get fatter. And at home, Raytheon, General Dynamics and Boeing executives get rich. Lobbyists get rich. Retired generals who join their boards of directors get rich. And even their shareholders get rich. But who pays for it? Recommended Link [Donald Trump — a Silicon Valley HERO?]( [Read more here...]( What if Trump recently did something that could see him become a HERO in Silicon Valley? According to the man dubbed “The Tech Prophet” by Forbes, it’s true. A single Federal Ruling in the final year of Trump’s presidency could be about to unleash a tech revolution worth an estimated $15.1 trillion. In the words of one tech insider – a CEO who works closely with Microsoft, Intel and Google – it “will rewrite the rules of what is possible.” And it could create countless ways for you to grow your wealth. [Click Here To Learn More]( When the Debt Comes Due Over time, the financing has shifted from taxes, to borrowing to inflation. The Empire of Debt loses money on every intervention… and, while its list of failed wars grows longer and longer, its mountain of debt grows too. Suppressing interest rates becomes a matter of necessity. But this discourages savers from lending their money to the federal government. So, rather than allow interest rates to go up, which would crimp their access to funds, the feds are forced to print money to cover their costs. This is about what happened to the Romans too. It is a problem of limits… and the cyclical pattern of life itself. Once the surrounding tribes had been subdued, the Roman Empire reached its furthest extent, under Trajan, in about 100 AD. Thereafter, emperors struggled to hold it together. Trajan’s grand-niece married Hadrian, another emperor, who built a wall across Britain, the first landmark of a less aggressive foreign policy. Without the booty – especially slaves – coming in from new conquests, Rome, too, had to turn to monetary policy. It shaved down the value of the Roman currency – the silver denarius. It was 95% silver when Augustus introduced it. A century later, in the time of Trajan, it was only about 85% silver, and the silver kept disappearing. By the time of Caracalla, who took over a century later, the coin was reduced to only 50% silver. Then, by 268, there was hardly any silver in it at all. When the money goes, everything goes. The Empire was then beset by corruption and civil war. It limped along for nearly 200 years more… one calamity after another – until it was finally conquered by ‘barbarians.’ Yes, dear reader, El-Erian may be right; US monetary policy may now be hostage to its foreign policy. But its foreign policy also depends on its monetary policy. Without the inflationary new money, the overseas misadventures may have to be curtailed. And without a ‘crisis’ – something going on somewhere that is none of our business and nobody really cares about – the Fed might have no excuse; it might have to cut back on inflation. But remember, it’s inflate… or die. Regards, Bill Bonner for The Daily Reckoning Editor’s note: For about two years, our co-founder Addison Wiggin has been running a regular interview series, [The Wiggin Sessions.]( The Wiggin Sessions in which he’s been picking the brains of some of the brightest independent minds in finance, including Bill Bonner. Until very recently, the Wiggin Sessions were only available to the Financial Reserve – our highest level of paid readership. Now it’s available to you for free. That’s correct: for free! The Wiggin Sessions aren’t dry talk about financial markets. [They include lively conversations about science, philosophy, politics, history, even pop culture – besides of course where you want to put your money.]( They’re quirky. Irreverent. And cutting edge. Just a few minutes of your day, each day, with the Wiggin Sessions will dramatically improve your understanding of what’s happening in the world of finance, the global economy, even politics (yech). [Go here now to sign up for FREE.]( By submitting your email address, you will receive a free subscription to Wiggin Sessions and offers from us and our affiliates that we think might interest you. 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