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Hi everybody, Steve Matthews here. Thanks for joining me today for episode 32 of Radio Luke's Solicit. The title of today's episode is, has the crack-up boom finally arrived? All right, so now you may be asking, so what's a crack-up boom?
That's kind of a weird sounding term. Well, we're going to talk about that here in just a few minutes. But before I get into all of that, I wanted to introduce what I was going to say here today with a little bit of a story.
Have you ever had a case where maybe you've done something for a while, you know, whether maybe it's something on your job or maybe something around the house or a hobby or something like this, something that you've done repeatedly, maybe for many years, and then all of a sudden it dawns on you, you have this epiphany that, wow, I've been doing this wrong all this time.
Well, I had something like that happen to me here recently, and it had to do with the way I have my podcast set up. A number of years ago when I first started doing podcasting, I bought a mic boom and a microphone.
Now, when you say a mic boom, you might be familiar with what I'm talking about. Maybe you've seen these, other people use them. Maybe if you're in a band or something like that, you use one, or maybe you podcast, or maybe you've seen people on a video or something like this using a mic boom.
But it's like a retractable arm, and you can put the microphone on the end of it, and then you can move the arm around and position a microphone where it's comfortable for you to sit and to talk or to stand and to talk.
So I bought this a few years ago when I started getting into podcasting and got it all set up. It's a fairly nice microphone in a mic boom and all that. For the most part, I liked it, but there was something about it that I didn't like, and that was the way that the cord kind of hung out the back of the microphone.
The cord would just kind of dangle there, and it'd get in the way of stuff. I sit in front of my computer with this, and the cord would get on the computer keyboard, or it'd get hooked on things. It was always kind of annoying.
It always seemed like it was kind of in the way, and I thought, well, this just isn't a great setup. Well, not too long ago, I was looking at my microphone in the mic boom, and I noticed something I hadn't noticed before, and that is it appeared that on the back of the mic arm, there were these covers, and so I pulled the cover off.
It's kind of like a plastic cover, and lo and behold, when I look underneath there, there's this channel, and that channel looks just about the perfect size for a mic cable. I thought, well, huh, now that's interesting, and it dawned on me that that's exactly what it was.
It was a place where you could, instead of having the mic cable just dangle out the back of the microphone, you could actually run the mic cord, the mic cable, up the top part of the mic boom, and it would get the cord out of the way, and you put the cord in there, and then you'd snap the plastic cover down on it, and it would hold the mic cord in place, and I thought, well, this is great, and then I realized myself, you know, how have I had this thing for three years, and I didn't know this?
I wanted to take me so long to figure that out, and I felt a little bit silly, felt kind of dumb, a little bit sheepish. I thought, that's kind of embarrassing to have something like this for so long and not realize it, and I even went, and I thought, well, am I crazy about this, and I even went, and I found a how-to video on how to set up a mic boom, and sure enough, there was somebody on there with a mic boom very similar to the one that I had, and that's exactly what this person was doing, the way she was setting it up.
She was running the cable up the top of the mic boom and snapping the cover down on it, and I thought, well, on one hand, I was glad that I had learned something, and that I had finally figured it out, and the other hand, I was, like I say, I felt a little bit silly that it took me so long to do it.
Well, I bring up that story to kind of lead into what I was going to talk about here today, and a few days ago, I had a friend of mine that I hadn't heard from in a while, and I get this text from him, and he says, hey, Steve, you want to come up and watch the presidential debate on Thursday?
This was the second of the two presidential debates that was held on October 22nd between Donald Trump and Joe Biden, so I said, okay, sure, why don't we do that? This is a friend I hadn't seen for a while, and he and I have very similar views on politics and economics, so it's always good to see him and talk to him, and I always enjoy having a chance to just sit and just talk about different things, and so I thought, well, that'd be a kind of a fun, interesting evening, so I accepted, and I went up, and I watched the debates last night, and I remember on my way home, I was just thinking to myself, you know, I thought, well, it was interesting, but it just seems to me something was missing from all of this, and the more I thought about it, eventually I got to the point where it finally dawned on me that at least one of the big pieces of the puzzle that was missing was the fact that nobody, not the moderator and certainly neither of the two candidates, ever talked about the Federal Reserve.
So what's the Federal Reserve, you might ask? Well, the Federal Reserve is, in short, it's the central bank of the United States, and it's the organization that prints the money, that creates the money, that's where our dollars come from, like if you take a dollar bill out of your wallet, and you look at it, across the top, it says Federal Reserve Note, so the Federal Reserve is in charge of overseeing the supply of money, the supply of dollars, dollar bills, in the United States, it's the central bank of the United States, that's what central banks do, central banks issue currencies, they issue the national currency, now every country in the world, with the exception of just a tiny handful, has a central bank, Canada has a central bank, Great Britain has a central bank, you know, the Bank of England, you've got the European Union has a central bank, it's just called the European Central Bank, you have the Japan has a central bank, the Bank of Japan, the BOJ, sometimes it's called, China has a central bank, it's the People's Bank of China, Australia has a central bank, any country in the world, major countries, minor countries, it doesn't matter, they all have central banks, I can say with very few exceptions, I think you count on one hand the number of countries that don't have central banks, I mean, it's just overwhelming, it's a worldwide system, well anyway, the central bank, it's kind of this 500-pound gorilla in the room, the activities of the Fed, and the Fed is just a shorthand way of talking about the Federal Reserve, the Fed, the activities of the Fed affect the lives of every single person, not just in the United States, but really in the entire world, because the US dollar is the world's reserve currency, so the activities of the Fed have profound implications for everybody, not just Americans only, but really for everybody in the entire world, and yet, you know, here's this profoundly important institution, and yet neither political candidate seems to want to talk about it, not Donald Trump and not Joe Biden.
Now, I remember back in 2016, Donald Trump did talk a little bit about the Federal Reserve, and he was chastised by Hillary Clinton, you might recall he ran against Hillary Clinton back in 2016, and Donald Trump was going around saying some very accurate things about the Federal Reserve, and I remember Hillary Clinton came out at one point, she said, you don't talk about the Federal Reserve, you know, she was very, very, kind of snippy about it too, you know, and so you kind of get this sense that the Federal Reserve, it's sort of this open secret, and it's something that the establishment, and whether you're talking about establishment Republicans, or whether you're talking about establishment Democrats, neither establishment, and it's really just one establishment, but the establishment does not want people talking about or thinking about the Fed, and as things go untalked about, it goes unthought about, so they don't want that front and center, and so you've got this tremendous, you know, there's all this ink and this time that's been spilt on the presidential campaign, yet nobody talks about the Fed.
As far as I am aware, I don't think the Fed has ever been mentioned, either in either of the two debates that took place, or in the competing town halls that they, that both candidates had last week, that subject just never comes up, people don't talk about it, and that's intentional, you know, that's not, it's like, oops, oh, we didn't mean to leave that off, no, that's intentional, is the establishment, and the establishment really controls, you know, both parties, both Republicans and Democrats, they don't want people thinking about this, they don't want people talking about it, because, well, they have an interest in keeping things secret, and of course that interest is, because if the Federal Reserve isn't talked about and discussed, the Federal Reserve can go about its activities without anybody questioning it, and the reason the establishment likes the Federal Reserve to operate in secrecy is because the Federal Reserve enriches the establishment at the expense of ordinary Americans, that's been the whole purpose of the Fed since it was founded in 1913, and I'm not going to get into, in today's podcast, I'm not going to get into the technicals on that, I hope to have an opportunity to talk about that at some point in the future, but just, I think just for now, just throw out this idea that the purpose of the Fed is really to enrich the already wealthy, that's the purpose of the Fed, and you can see that really here in 2020, in spades.
For example, of course, you know, we've had all of the economic difficulties over the last few months because of the government's overreaction to COVID. Now, notice here that I said, you know, that the economic problems we have, they're not the result of COVID, they're the result of the government's overreaction to COVID, and shutting everybody down, and locking everybody down, and closing businesses, throwing people out of work, and millions and millions and millions of ordinary Americans have either lost their jobs temporarily, sometimes permanently, had their hours cut back, they've had businesses that they built for years shut down by various state governors, and it's put people in a very, very difficult position.
This created a lot of hardship, the reaction, the overreaction of so many of these governors, but at the same time, there was an article that I saw last week that said that America's billionaires, that their net worth had increased by 25 in just about the last six months or so, that is the period corresponding to all of the COVID shutdowns.
And what's going on there is the fact that you've had, you might remember back in the spring, in fact, there've been a couple of stimulus packages that were passed, you know, to help prop up the stock market and prop up these various industries and what have you.
Well, all of that money, or a pretty good chunk of it, the vast majority of it, has flowed to people who are already extraordinarily wealthy. So the very, very, very rich, and I'm not talking about even just the top 1%, I'm talking about here maybe like the top 0 .1 of 1 of the people, have profited enormously, whereas the vast majority of ordinary Americans have suffered because of the reaction of the government.
So you've got a very tiny minority of people who have benefited by the actions of the government and the money printing of the Fed, and everybody else has been hurt by this, and of course the establishment of both parties don't want people thinking about this.
They don't want people thinking about that. So it's a cover-up, and it's not an accident, you know, the political establishment does not want people talking about or thinking about these things. Well, anyway, so that was one, kind of getting back to my point there, you know, it dawned on me how the fact that the Fed has been completely absent from anything, any of the discussion of our political leaders during the presidential campaign.
Well, I was kind of heartened today to see Ron Paul's Liberty Report. Ron Paul, you might be aware, he's the former congressman from Texas, and he's been retired for a number of years now, and for several years he has had a five-day-a-week YouTube video that he produces.
It's called the Ron Paul Liberty Report, typically about 20 to 30 minutes in length every day, and he and the co-host will talk about different subjects, and every Friday they always talk about the Federal Reserve.
So today, it was interesting, the title of his video was called Fast Approaching, a Crack-Up Boom of the Fed's Making. So again, getting back to that question, well, what on earth is a crack-up boom?
Well, I'll give you just a quick definition of it. There was an economist, a very well-known economist of the Austrian school by the name of Ludwig von Mises, who coined that term crack-up boom, and the crack-up boom, what it was, it was an artificially created boom that was created by central banks printing lots and lots of money that ultimately ended up with people losing faith in the currency and the collapse of that currency.
So it was sort of an artificial economic boom that ends up with the currency becoming worthless, he called it a crack-up boom. And there have been some famous examples of that in the past hundred years or so.
If you've studied economics much at all, you might have heard of the great inflation in Weimar Germany in the early 1920s, and that was where the German currency went to zero because of all the money printing by the central bank in Germany.
And it's a very famous case, it's been studied and talked about a lot, but it's not the only example either. There was an example of this in the African nation of Zimbabwe several years ago. And in fact, a number of years ago, I actually bought a Zimbabwe banknote.
It's an actual real banknote, it was issued by the Bank of Zimbabwe, and it's a 100 trillion dollar note. They had devalued the currency so much that they were printing banknotes in the value of 100 trillion dollars, if you can imagine that.
And I think I bought it on Amazon for the princely sum of about $1 .74 or something like that. And it's kind of nice, it came, it wasn't just a bare banknote, but it also came in sort of like a laminate cover so it protects and it doesn't get all folded up in that or ruined or damaged.
I mean, you wouldn't want to damage something that was 100 trillion dollar note, right? I mean, you got to take care of it. Yeah, of course, you couldn't buy a piece of chewing gum with it. But it's very impressive when you look at it.
I mean, man, golly, 100 trillion dollars. Wow. Well, you know, the reason that their currency, that it took 100 trillion dollars to actually buy something when it was printed, it wasn't that long ago that it was printed, it was printed, I think, back in 2008.
So it's fairly recent. But the reason that the Zimbabwe dollar became worth so less is because the Central Bank of Zimbabwe printed so much of it. And this is what happens when central banks run wild.
They print so much money that the currency that they issue ultimately becomes worthless. And that's the end of what Ludwig von Mises called a crackup boom. The central bank just runs wild, prints so much money that the people lose confidence in the currency, and it becomes worthless.
And so Ron Paul and Daniel, and excuse me, his co-host, Chris Rossini, today we're talking about this crackup boom. And they made the very point that I made. I always feel good, you know, if I can anticipate something that Ron Paul is going to talk about, I think, wow, you know, I mean, Ron Paul, you know, he's at the very top.
I mean, Ron Paul is a real hero to just about anybody who loves liberty and constitutional government and freedom, these sorts of things. Ron Paul, in my opinion, is the greatest American statesman of my lifetime, certainly.
And I was heartened today to see that he and his co-host, Chris Rossini, were talking about the very thing that I was thinking about. You know, they brought up the point in this video from today, and this is October 24th, or excuse me, October 23rd, they brought up the point that, hey, you know, these presidential candidates, neither one of them talked about the Federal Reserve, even though it's this really big deal.
So I'm going to play for you a clip here. It's about a three-minute clip, and you'll hear Ron Paul and Chris Rossini talk some, and then we're going to come back when this is over, and we're going to talk some about that.
So here's Ron Paul.
And Chris Rossini. Germany, but everybody knows there's something fishy going on right now with our monetary system, because the Republicans and the Democrats are getting along pretty well when it comes to spending money.
They disagree a little bit on how fast and how much and where it's going to go, but the interest in restraining spending is not even entertained, and obviously, if anybody watched the debates last night, I don't think there was any interest in that subject.
You didn't have the interviewer, the host, asking the question, what are you going to do about the deficit? Do you think the deficit matters? How about debt? What is happening? No, that's old fashioned now, because the world and our people, the Congress, our universities, everybody is conditioned to actually believing that we can contain it, and they have reason to take that position, because they've been doing fairly well, you know, getting away with it, but there's more and more people joining us, Chris, and being concerned about it, because common sense tells us this can't last, and something like a crack-up boom is destined to happen.
We want to talk about that and a little bit about the characteristics of that, and I know you have studied this subject,.
So let me hear from you. That's right, Dr. Paul. It was Ludwig von Mises who coined the term crack-up boom, and he pointed out that inflation, counterfeiting of money, it contains the seeds of its own demise, meaning once you go down that road, the end of the road is already baked in if you don't stop, and he called it a crack-up boom, and I'd like to quote him.
He wrote, finally, the masses wake up. They become suddenly aware of the fact that inflation is a deliberate policy and will go on endlessly, and he says a breakdown occurs when they wake up. The crack-up boom appears, and everybody is anxious to swap his money against real goods, no matter whether he needs them or not, no matter how much money he has to pay for them.
So this is the road that we're on, Dr. Paul, and it doesn't end well. Yeah, for the theory to work.
That there won't be a crack-up boom. So there you have it. There's a little discussion here of the crack-up boom, and Chris Rossini was nice enough, he read from a, he's actually quoting Ludwig von Mises.
That quote that he read, it's out of Ludwig von Mises' book, it's called Human Action. Von Mises was quite a prolific author. He wrote a lot. He was an economist, as I had mentioned, and his most famous work, I guess if you want to sound like a scholar, you would call it his magnum opus, or if you just want to put it in plain English, you'd say his greatest work is a book, it's called Human Action, and it's where he really lays out in a lot of detail his ideas about economics.
Ludwig von Mises was a big believer in capitalism, in private property, in laissez-faire economics, and as Christians, of course, we would have a lot that we would agree with him on. Now, von Mises was not a Christian, but a great deal of what he had to say is really consonant with what the Bible teaches, and I think he's certainly somebody that, as Christians, we can read his work and profit a lot from it, even if he himself was not a believer.
So anyway, Chris Rossini was talking there about the crack-up boom, and what that is is, again, it's a case where a central bank prints so much money, it kind of creates an artificial economic boom, but that economic boom ultimately ends up in a collapse of the currency, because people realize, they say, oh, wait a minute, the central bank, not only have they been inflating and devaluing the value of our currency, but they're going to continue to do it, and then people become very panicked, and they want to get rid of their dollars, they want to get rid of the money issued by the central bank, and they're changing in for anything, anything they can get their hands on, they're going to buy stuff they don't need, just to get rid of the money, and then they can have some actual, quote, real stuff, and maybe they can sell it or barter it, but at least they're getting rid of the rapidly depreciating currency.
And of course, Ron Paul made the point there in that segment, too, that during the debate, there were no questions about budget deficits, there were no questions about debt, because that's just considered, that's kind of silly, old-fashioned stuff, and we don't need to worry about that anymore, because we have a central bank that's going to keep, you know, it's got everything under control, and it's going to cover us.
Well, you know, if that were the case, I mean, if all that you needed to do to have a prosperous economy is print money, well, none of us would ever have to work. You know, there's that old saying, there's no such thing as a free lunch.
Well, you know, the problem is the central bankers and the politicians and really people in academics and people in the media, they're constantly trying to convince people that, yes, there really is such thing as a free lunch, and you don't have to do anything, and you can just, you know, stay home and get locked down, and you don't need to work, and the government will just print money, and everything will be great.
Well, everything isn't going to be great. There are going to be really serious consequences of that. Now, you know, we talked about a crack-up boom as being a result where the currency goes to zero. Now, I think a lot of people might have a hard time believing, you know, can the dollar really go to zero?
Well, yes, it can. In fact, the, what are called fiat currencies, and the dollar is a fiat currency, the track record of fiat currencies is 100%. They all ultimately end up going to zero. So, we can expect the US dollar also to go to zero.
Now, I don't know when that's going to happen. Now, is it going to happen tomorrow? Probably not, but is it going to happen maybe sometime in the next few years? Well, I think there's a good chance that that could happen, and I think there's a very good chance that we're going to be around when that takes place, and it's going to shock people.
It really, it's going to shock, and it's going to stun people, and yet we have a political establishment, you know, we've had an entire political campaign where nobody's talked about deficits, nobody's talked about debts, and nobody's talked about all the money printing by the Federal Reserve.
So, you know, this is something that's going to have very severe consequences. There already is, but all that money printing is going to continue to have consequences, and one of the reasons is, of course, the Federal Reserve is not going to stop printing.
They've already printed an enormous amount of money here in 2020, and it's going to probably be even a larger quantity next year, and it's not going to matter who's president. You know, whether Donald Trump is president or whether Joe Biden is president, the Federal Reserve is going to print a huge amount of money, and this is something that we have to be ready for as Christians.
We have to be ready for the fact that our dollars are going to be worth less, worth a good deal less, and probably not in the too far distant future. So this is something we have to keep in mind as we make plans going forward.
Well, anyway, I could go on and on about that sort of thing. I'm going to put a link to that video with Ron Paul from talking about the cracker, but I'm going to put a link of that in the description of the video.
I think it's well worth your time. If you've never seen Ron Paul, I'd really encourage you to follow his work. I think he does some of the very finest work on economics and politics that's out there, and he's a hero of mine, and as I said, I think he's a hero for a lot of people.
Anybody who loves liberty, I think, is going to be an admirer of Ron Paul. Well, that's about all that I had for today. Just a couple things, just quick to wrap up before I go. I'm going to post this podcast, I'm going to post it both on the Thorn Crown Ministry website.
I'm also going to put it out there on my blog. I wanted to let you know, too, I added something, a feature to my blog fairly recently, where if you want to, if you get something out of this podcast, if you enjoy the work that I do on the Looks Lucid blog, you've got an opportunity there to make a contribution to support that work.
You can make a one-time contribution or a recurring contribution. Any amount would be greatly appreciated. I always very much appreciate anybody who does donate. What it does is it helps me to keep free the things, the writing, the podcasting, that type of thing that I do.
Again, if you are so moved and you'd like to tip me through the blog, I'd appreciate that. So that's all here for today. I hope to follow up with you again here sometime in the not too distant future with another podcast.
Until then, may the spirit of truth guide you in all truth as you read and study God's Word. Goodbye, everybody.