The Cancer

Can it be Removed?

Greetings, my dear readers, and welcome once again to the Asylum. If you have read my work for a while, you know that I believe Trump’s failure in his first term to effectively change Sodom on the Potomac was a result of his inexperience and general unpreparedness for the hardball politics or the dirty tricks, betrayal, and general media storm that came with it. In short, Trump was unable to be as effective as he wanted to be. This time appears to be different, and he appears to truly be ready to take on the swamp. Last week, we talked about some of Trump’s opening moves. This week we will ponder the question of can Trump really fix things. The short answer is no, he cannot. The problems we face today are all rooted in economics, and they have been compounding for over a hundred years. As a result, one president will not be able to make things right, but one president can start us down the path to redemption.

The first step is a shift in popular opinion and perception. People need to be far more wary of the government and less willing to rely on it for solutions to various day-to-day problems. Fortunately, I think the total shit show that was COVID did a lot to expose not only the fact that the mainstream media is propaganda, not news, but also that governments in general without exception are more interested in control than the freedom, happiness, or welfare of their people. We see this in Trump’s staggering victory of both the electoral college and popular vote, Canada’s Prime Minister stepping down, and leading the way Argentina’s new Prime Minister. We see it in the elections of both France and Germany, as well as other European countries. In these places the establishment is often trying to move the goal posts and change the rules to subvert the will of their people. In France, Germany, and England, the establishments’ primary tactic (as it is here) is to claim that anyone in support of national sovereignty, secure borders, and freedom through accountability is essentially a Nazi. This isn’t true here of the MAGA crowd and it isn’t true in France with National Rally, Germany with Alternative for Germany (AfD), or England with Reform UK. These parties primarily want to stop the floodgates of immigration, protect the people of their respective countries, and prioritize national interests over international interest (here, here, here, here, here, here, here, and here). These are huge shifts, and I worry what the establishment might do to retain its power, that was once almost absolute, but is now slipping more and more quickly through its grasp. The tides absolutely appear to be turning against globalism and dependency towards self-determination and freedom.

Even if new and tenuous at this point, for the first time in my 48 years of life, the foundation for real change is there. What happened and how does it get fixed? From this point on I am going to be addressing America, but the pattern is similar throughout the Western World. The root issue to all of our issues as a nation are economic. All the other social issues either stem from the primary economic issue or are only issues because the establishment needs them to be as a distraction to maintain control. To fully understand the primary root cause of our issues we will examine inflation from 1913 to today. While there were instances of situational inflation prior to 1913, where if a crop failed over a wide area the price of certain things would explode until the next harvest or locationally where through a combination of demand and opportunity prices were exorbitant primarily in boom towns or around gold rushes like in California, inflation was almost non-existent with United States Dollars because there was very little fractional reserve banking and the act of producing money (supply expanded 1-3% a year) added resources to the total available pool offsetting any inflationary effect. After 1913, inflation began being tracked closely with the advent of fractional reserve banking and then even more closely after 1971 when the Dollar was rendered a fully fiat instrument. I am sure in various commentaries you have read, as have I, about how the prosperity of the United States after World War Two (WWII) was lost in the 1970s and never really returned. That statement is true. Americans have been losing ground ever since then, arriving at a point today where the average salary can not buy the average house let alone support a family (here). To understand this, we will use the government inflation calculator (here). I know the government’s numbers are not the best, but they still prove the point and allow for consistency. I am using a decade span of time because, with rare exceptions, from 1913 to the 1970s the average wage has doubled every ten years (here). We will use a dollar in our starting year and then see if you would be better off, the same, or worse a decade later if you doubled that dollar indicating you had improved your salary by 100%. If we start in January of 1913 with a dollar, we see that by 1923 it would take $1.71 to buy the same amount of stuff, meaning that if you doubled your income, you would be around 29% better off and you needed a 71% increase to maintain the status quo. If we look at 1923 to 1933, we see a dollar turns into $0.77. This is because of the depression and all of the money destroyed when banks practicing fractional reserves failed. In this period, if you did no better over that decade you were 23% better off and if you doubled your income you were 123% better off than in 1913 (I realize that due to unemployment many people didn’t see the benefit, but we are looking only at the buying power of dollars and what affected that directly). Then moving from 1933 to the middle of WWII in 1943, we see that $1 became $1.31 so to maintain a standard of living you only had to improve 31% over the decade and if you were able to double your income then you were 69% better off. From 1943 to the post-war baby boom of the 1950s, we see that $1 turned into $1.57 by 1953, indicating that again it was fairly easy to improve one’s standard of living with average wages doubling over the decade. From 1953 to 1963 a dollar becomes $1.14. From 1963 to 1973 a dollar becomes $1.40. Remember, wages are still doubling about every ten years. The span between 1973 and 1983 is special because it marks a turning point. On August 15^th, 1971, Richard Nixon rendered the US Dollar a fully fiat currency that could be produced at will with no corresponding increase to total goods and services for the first time in American history. As a result, by 1983 you needed $2.30 to equal a dollar in 1973. This is because the pressure of the Great Society welfare and the Vietnam War expenses were satisfied with a massive print off of currency. Unfortunately, this paired with the end of wages doubling every decade left many people 30% or more worse off than they were, or more if they did not double their salary. From 1983 to 1993 we see a return to sanity with higher interest rates and a focus on reducing spending, leading to a surplus in the Clinton years. It only took a $1.40. Again, wages did not double, but they did increase. It took $1.27 in 2003 money to equal $1 of 1993 money, and again wages were still outpacing the inflation. However, this still hides the fact that it would take $18.54 to buy the same amount of goods that $1 could by in 1913. To put this in perspective it would have taken $4.35 in 1973 to buy the same amount of goods $1 in 1913 could buy. In 30 years after the US dollar became fiat, we had 326% more inflation than in the 60 years with just fractional reserve banking. It only gets worse from there. 2003-13 is another $1.27 and 2013-23 is $1.30.

Wages stopped doubling on the decade in the 1970s. The nation saw a bit of relief as policies of the middle 80s were able to drive up wages and help them keep pace with inflation until the early 2000s when that changed (here). This has resulted in the devaluation of currency outstripping the growth of wages. This decreases standards of living for average people, while benefiting the very wealthy who get access to the new money before regular people. This is important because Goldman, Chase, and other large institutions get to spend the money at a higher value than regular people do. This leads to the concentration of assets at the top. Something that did not happen until after 1973 because the government wasn’t free to print money at will. Ultimately, fractional reserve banking and fiat currency have worked together to destroy the

middle class, making it extremely difficult to advance up the economic ladder using the classic work hard and save model, since dollars saved become worthless the longer you save them. You can invest in the stock market. Many will tell you it has never been down over a 25-year span. While this is true, I do not think it will remain true because more and more companies are not valued based on assets and production, but on faith and stock buy backs. I say this because 5.8% of all publicly traded companies are zombies, meaning they do not or have not ever made a profit and exist only of cheap credit, equity infusions, and hope (here). These are not just penny stocks either. Nationstar Mortgage, LLC (d/b/a Mr. Cooper), one of the nations largest mortgage servicers, is a zombie company (here), as are many other finance and banking institutions (here). These represent well over a trillion dollars in market value while generating no profit and being in debt beyond the scope of their assets. These companies are the real reason the Federal Reserve has been cutting interest rates while inflation is still well above target (here), pausing only because of the new administration. Anyway, Wall Street is a false economy because it produces nothing yet has cut up shares of honest companies with derivatives, shorts, and other instruments that allow them to resell the same share in multiple forms to different people making fake paper markets funded by loans backed by a fraction of the liability. As this false paper economy grows, the inflation it creates further stresses the real economy of producers and workers (here, here, and here).

There are two ways out for Trump and those that come after. One is the Reagan short-term fix and that is to have wages catch up to and then keep up with inflation. This will be harder to accomplish and be the least permanent but will be the most popular. To achieve this solution an environment of extreme competition for employees will need to be created so that companies have no choice but to bid up salaries, not only to bring on new people but to retain the talent they have. I can see how tariffs might stimulate the construction of factories in America thus increasing the demand for labor, but I am not sure that would be fast enough or that there is a method fast enough to see results in Trump’s term. The problem here is also that the underlying problems of fiat currency, fractional reserve banking, and arbitrary interest rates are preserved. This will allow any good that is achieved to be undone easily by any future administration sponsored by big banks.

The second option is a nightmare scenario, but unfortunately, we as a nation have allowed a cancerous rot to eat at our insides for one hundred and fifteen years. As a result, exercising will be painful and terrifying. The first step would be to ask Federal Reserve Bank (FED) Chair Jerome Powell to step down and if he refuses then replace him in May 2026 when his term is over. He must be replaced with someone totally anti-federal reserve, such as Peter Schiff, who will first fully and publicly audit the FED and all its activities. Then, aggressively investigate and prosecute any illegal activity as well as call in all debt owed to the FED by foreign nations using the proceeds from payments to clear US Bonds held by the FED. Lastly, jack up the overnight rate 15-25% and let it all unwind. This will kill all the zombie companies and many other over leveraged, under-producing organizations. It will be bad, but it will also be deflationary as untold billions of unbacked fiat will return to the void from where it came. There can be no bail outs and all those that fall will need to be liquidated at bankruptcy auction. With private account holders given priority over all other creditors for the proceeds from commercial banks. Once the carnage has played itself out (no intervention) and masses of fiat have gone back to the void they came from, repeal FDR’s executive order forbidding the ownership of gold, repeal the fixed value of gold at $#% from $20 an oz that FDR made, issue an new order based on actual FED numbers making the value of gold reflect the amount of dollars still in circulation, and lastly repeal Nixon’s executive order of August 15^th, 1971, paying back bonds in gold at the newly assessed value. This will resize the debt to reflect the new hard dollar making it payable. This should have a stabilizing effect to some extent on home finances. After the dust clears and things start to recover, we need to do away with fractional reserve banking and the Federal Deposit Insurance Corporation to prevent monetary expansion by fractional reserve and make banking much more stable and safer for everyone.

All this probably could not be done in one term. What could be done would have to be done with enormous amounts of education and transparency. I say this because if people understand what went wrong and how that has affected them, they will be willing to endure the pain so future generations could have better options and possibilities. This course would also require massive cuts in government because you cannot run massive deficits on hard currency. This reduction in government will mean less power and influence, making it harder for companies to buy favor with the state. All in all, a win and in ten years when all of the repercussions finally shake out America would be on a much firmer foundation for real growth that causes available goods and services to increase while perpetually driving costs down.

Anyway, I see Trump doing better this time and do believe he is going to try option one this unfortunately means in 20-40 years we will be right back here if he is successful, but we might still get less government if only for a time out of it.

Proverbs 16:8

"Better to have little, with godliness, than to be rich and dishonest"

God Bless you

-Sam