Bestselling author Nomi Prins says the ultimate destruction of the economic system will be the global debt. Prins, who wrote the upcoming book titled Collusion: How Central Bankers Rigged the World, says that one tiny interest rate hike could destroy everything.
Prins says the debt is historically high, and that this will create untold problems whether governments want to admit it or not. Politicians cannot keep spending imaginary money that they don’t have and neither can regular everyday Americans. In an interview with USAWatchdog‘s Greg Hunter, Prins takes us through what will likely happen to the economy and the reason for its failure.
“These are levels that they have never been, and they are all at their historic highs. That’s why debt will ultimately be the destructor of the system. In order for that to happen, the cheapness of money that allow states, municipalities and corporations to continue to borrow at these cheap levels has to go away. . . . At some point, there will be a mistake. There might be a tiny smidge of an interest rate hike at some central bank, probably the Fed, which ripples throughout the system as a mistake, not because real growth has happened, and that’s why interest rates have been raised. That will incur defaults throughout the system. People will incur personal defaults, and that will cause problems in the mortgage market . . . then it becomes a knock-on credit crisis, and then banks start not to lend . . . . Then we have the makings of a broad crisis.” –Nomi Prins
Prins, who was also a top Wallstreet banker says central bankers have no idea how to stop the easy money policies that they started after the financial meltdown of 2008. Prins explains that the steps which were taken by central banks and governments after the 2008 collapse have only made matters worse.
“So, when the Fed says they are going to remove assets from their $4.5 trillion book by not reinvesting the interest payment . . . the reality is they haven’t really done that. They have reduced their book by about $10 billion off of $4.5 trillion since they mentioned they were going to start ‘tapering.” And the media discusses this as a major tightening move. Somehow all of our economies have finally worked because of central bank activity. Growth is real. It’s all positive. The markets are evidence of that because of the levels they are at; and, therefore, these central banks, starting with the Fed, are going to reverse course of these last 10 years. The reality is if you look at the actual activity of the central banks, beyond the Fed raising rates by a little bit, there hasn’t been and there isn’t being a reversal of course becausethey are scared to death that too much of a reversal is going to cause a major crash throughout the financial system. Everything is connected. All the banks are codependent. All the markets are codependent. Money flows around the world in less than nanoseconds, and all of it has the propensity to collapse if that carpet the central banks have created is dragged from beneath the floor of all this activity.”
“There hasn’t been any real growth in the real economy. That is an indication of the misfire of this entire plan.” -Nomi Prins
Hunter also asked Prins to explain a section of her book in which she describes the central bank as creating a “new, unstable, normal.” “What could go wrong?” asks Hunter.
“The reason this is unstable is because it’s all manufactured. This activity, the collusion between central banks is real. And the level of rates being low is real. And them having bought the assets in different asset classes is real. But what’s really mercurial and what’s really very dangerous and unstable in this new status quo is what could happen if any of them were to shift in a manner that spooks the markets out…central banks are trying to be very careful about their activities to avoid this scenario…the instability that could be incurred on the system is a byproduct of how much has been built up in terms of debt.”
And the central banks have no plan B for when their quantitative easing scheme fails. What will this crisis look like to the everyday person trying to get by?
“You start to not be able to take as much cash out of your bank account, ATM levels go down from like $500 for an extraction to maybe $2 [hundred] or so forth, you start to have Cypress type activity where financial systems and banks are trying to maintain the liquidity that they have to protect themselves and that has a knock on effect on individuals, that has a knock on effect to raising rates for credit cards, to student loan rates creeping up to auto loan rates creeping up. And that becomes then more expensive for people to deal with and to the extent that wages for any types of financial packages that people have with regular employers…then start to have problems making ends meet. It doesn’t take long to go from missing a credit card payment to being delinquent to defaulting on that card to having your credit score go down and so forth.”
Bring on the depression!
I’m ready for it.
I would bet that you are not.
when this debt system really implodes, going weeks without water and electricity is possible.
only those that live on their own land with their own water and food or livestock have a good chance if things go shtf bad.
Problem is I’m 68 been hearing about this since we stopped using Silver coin in 1964. E#eventually the Sun will nova and vaporize the Earth. SO What?
I think he is ready, lena. Having land is as good as gold, maybe better.
Although I could use more gold…(who couldn’t?)
Wife and I have been without power for 4 months now and about 1 month with no municipal water. We haven’t missed a thing because we were ready. Water storage tanks, rainfall catchment system, solar and generator.
rellik is ready.
Come on you know what they’ll do.
Ketchupondemand is mostly right.
What do you have to trade for a weaner pig?
I have 8 available.
IS that an O-S-C-A-R M-A-Y-E-R weaner pig?
i was about to say relik is about as ready as ANYONE CAN be, but you beat me to it…another guy from hawaii comes to mind, too.
Seriously, God only knows what is going to happen. All of this is the result of messing with things you should not fool with folks… It is all fake and manipulated and rigged.
mortgage companies won’t let you buy a house if you have over 40% of debt because they know it’s likely you’re going to default and it’s going to cost them; but govts keep blowing debt away.
bad. at some pint this is going to be really bad.
Darlin’ Nomi – debt IS the system. Throughout history it is not who or how widely spread wealth is… more and more people solvent and with savings … that has mattered as to what happens in terms of rise or collapse. It has always been who owes who how much. Take away debt and no central government has control. Those same institutions supported by their cadres of slobbering legislators need the people to be in debt. It is what allows for war, programs for the destitute (which in essence if you think about them are wars) and control over the destinies of nations and their populations.
yup!…..and it(we) all works for them…..until it DON’T! y’all should READ this story as many times as it takes to understand. cities, counties, states, and the fedjal gubmint is BROKE(and BROKEN)…..and the PEOPLE are up to their asses in debt. when in the HISTORY of man have interest rates been this close to zero….for so LONG?
Bring it on! When this happened in Eastern Europe, some of the best pussy on the planet could be had for a few dollars.
One of the beneficial outcomes will be American women getting thinner and hotter. And working a little harder at being ladies.
Pimpin’ ain’t easy.
Bitcoin for the hoes.
frank, it sounds like there will be pussy by the handfulls….i suppose we will have trump to thank for that! but i suspect those women MIGHT just force your hand….
A house of cards and with one sneeze – that’s all she wrote.
I really don’t think there are any safe havens except one. Commodities can be confiscated; blockchain technology can be hacked; activity in your backyard will be noted.
A good time – a very good time – to get reacquainted with your Lord.
She’s kinda stating the obvious. The whole system IS debt.
Every dollar (or any unit of currency) is loaned into existence and usury attached. If all debts were paid there would be no currency left in existence. It’s “debt based” monetary system.
The debt MUST continue to rise to pay the attached usury or the system collapses.
This is why all the politicians…including Trump…never ever reduce spending. They cannot risk a collapse by doing so.
Trump will continue with the trillion dollar deficits and I wager will double the national debt (or close to it) in eight years. Not saying it’s his fault…it’s the fact of an unbacked reserve currency. They all continue to do it ever since gold was removed as a guarantor of all fiat currency.
Think of it this way. For all you have in investments or savings, there is a corresponding debt. Have a debt jubilee and you will have granny’s investment and pappy’s pension wiped out. You didn’t think your 401k or IRA or pension fund was a pile of cash sitting there did ya? No,it’s someone else’s debt that was bought in the form of stocks and bonds that makes up the fund. They call it “investing” your money when all they’re doing is buying someone else’s debt.
You own debt…hahahahaha…
Drives a man to drink.
The next war ain’t gonna help our debt situation. Unless we take serious population losses.
Then entitlements won’t be such a big problem with 150 million useless eaters not around.
Let’s see. What cities can we afford to lose? Let’s throw some darts at a map.
look at a chart of our national debt(even though it aint as LOW as they say it is). that line of debt compared to TIME is about to go parabolic. the debt is climbing faster than it can be paid back, at a quickening pace. when interest rates go to just 4%, we won’t be able to service the INTEREST, let alone the principal. that is the day it all goes POOF….