All Empires Die By Deflation – Not Inflation
A lot of people have asked what to do because property taxes keep rising and they can see they are unable to retire under such circumstances. The politicians are wiping out the elderly diminishing their savings and exploiting them in every way. There are no exceptions for taxation when you sell your home as there are in Britain. You pay no tax on the profits from a primary residence there. In the USA, you are taxed until you die. and then they want what is left.
Property taxes are the worst of all taxes for they prevent you from really owning your home. Can’t pay the tax – they take it and sell it for pennies on the dollar. You have to pay taxes as if you were still working so all you can do is sell and move south and then pay taxes on your gains. New Jersey even put in an exit tax on the people it has been forcing to leave. California has been hunting former residents who moved demanding taxes on pensions claiming they earned it when living in that state. It is a wonder why we do not yet have a sea of grey hair people with guns and pitchforks storming Washington yet.
This is how empires die. Taxes in Rome kept rising. Its population peaked about 180AD and as corruption began to rise, people began to leave. The higher the taxes, the more people left town. Eventually, people could not afford the taxes and were forced to just abandon their homes. This is the death-spiral of empires. They consume all wealth until none is left. Indeed, Ben Franklin got it right – our fate is always doomed by death and taxes.
By the Middle Ages, the Roman Forum, was the grazing grounds for animals. Edward Gibbon wrote the best epitaph:
“Her primeval state, such as she -might–appear in a remote age, when Evander entertained the stranger of Troy, has been delineated by the fancy of Virgil. This Tarpeian rock was then a savage and solitary thicket; in the time of the poet, it was crowned with the golden roofs of a temple, the temple is overthrown, the gold has been pillaged, the wheel of Fortune has accomplished her revolution, and the sacred ground is again disfigured with thorns and brambles. The hill of the Capitol, on which we sit, was formerly the head of the Roman Empire, the citadel of the earth, the terror of kings; illustrated by the footsteps of so many triumphs, enriched with the spoils and tributes of so many nations. This spectacle of the world, how is it fallen! how changed! how defaced! The path of victory is obliterated by vines, and the benches of the senators are concealed by a dunghill. Cast your eyes on the Palatine hill, and seek among the shapeless and enormous fragments the marble theatre, the obelisks, the colossal statues, the porticos of Nero’s palace: survey the other hills of the city, the vacant space is interrupted only by ruins and gardens. The forum of the Roman people where they assembled to enact their laws and elect their magistrates, is now enclosed for the cultivation of pot-herbs, or thrown open for the reception of swine and buffaloes. The public and private edifices that were founded for eternity lie prostrate, naked, and broken, like the limbs of a mighty giant, and the ruin is the more visible from the stupendous relics that have survived the injuries of time and fortune.”
Coins v Bullion
QUESTION: Hi Marty,
Quick question, you always recommend coins over bullion. I have some of what I would call bullion coins (I.e., Silver Eagles) … are you thinking it’s better to have “junk silver” (I.e. pre-1964 US coinage) in one’s posession instead?
Thanks in advance,
-P
ANSWER: The “bullion” is bars. Yes there are “bullion” coins, but as long as it is recognizable in coin format you at least meet the average person test and second perhaps you will be in the exemption for collector coins that at least prevailed under Roosevelt as an exception. I would recommend $20 and $10 US gold coins common date that are just a few dollars above the bullion value. The ONLY reason we have gold coins that have survived is because Teddy Roosevelt was a ancient coin collector. Franklin understood that there had to be an exception for coin collectors because they existed in his family.
The nasty insane laws passed in Minnesota that anything containing 1% of precious metals must be tracked for the state is not looking very good for any exception. The more states that follow this lead warns more of a deep underground economy in the future. There would be nothing left standing when politicians strip the meat from every dead carcass. Lawyers ONLY know how to right laws – they do not understand their full implications. No lawyer should ever be allowed to hold office. Judges fine – but never politcal office.
Sniffing Out Pegs
Beware the pegs. Now that traders have been wakened from a deep sleep buried beneath tons of political propaganda furthered by the press, they are sniffing around to see who is next. Hm! Look at Denamrk’s peg to the Euroland.
One World Reserve Currency
QUESTION:
Martin,
I must take issue to the answer you gave on Jan 19th to the crypto currency and one world currency question. Mainly the first sentence. You said “ A one world currency seems to be the only POLITICAL solution”. I see that you highlighted the world political. Can you please explain your reasoning for this? My problem with a one world currency is, who would be in control of that currency the IMF? No thanks. This would be the most disastrous outcome in my opinion. (not saying that it won’t happen) Concentrated power is always a bad idea. I believe if they (the powers that be) pull this off we will be one step closer to a one world SOCIALIST government. If a one world currency is the only POLITICAL solution what would, in your opinion be the FREE MARKET SOLUTION?
BM
ANSWER: An agreed upon one-world RESERVE currency would perhaps be a basket. I too am concerned who would be in control. I can say that the IMF is posturing already for that position. There will be the installation of corruption if the the IMF takes control. This is not my personal CHOICE. This is not about myOPINION, it is simply what is unfolding. I am certainly no fan of the IMF.
Nevertheless, the Free Markets would still prevail for each country’s currency would then float against the reserve. This would be the political solution for the major countries could then agree. The problem when one nation’s currency becomes the default world reserve currency (Babylon, Athens, Rome, Britain, Spain, France, USA, etc..), their domestic policy objectives become forced upon the world.
Just as the USA is scared to death of deflation as in the Great Depression and immediately stimulates, the Germans are obsessed with the hyperinflation of the 1920s and keep subjecting themselves and the rest of Europe to austerity (deflation) even at the expense of 60%+ unemployment. Both fight the FREE MARKETS to their own self-destruction. You can die from extreme cold as well as heat. The answer lies in between – never at the extremes of either philosophy.
We are headed into the vortex of fiscal mismanagement. The outcome will be the solution of creating a one-world currency for p
2015 Conferences
QUESTION: I was at the Philly conference was outstanding ! Any plans for trading conferences this year ?
Also would you have a recommended reading list ? I have read everything you have written twice !
Best
J
ANSWER: We will be doing a seminar. Most likely in Europe and in Princeton. Perhaps by June. I have to attend the theater debut in Germany in April for the movie. It has reached blockbuster levels there and will appear in 80 cities. So I am trying to work out the schedule. We have some books on the site.
We will let everyone know the dates as soon as possible.