ICE-NINE

There is a great consensus on you tube financial channels that we are close to a devastating economic crisis, much worse than the last one of 2008. There are many reasons this is about to happen, the most mentioned is the debt bubble. Debt is bigger than ever. That is true for governments, companies, most of all fintech companies, and households. There are many ways to calculate debt and interpret it - but the bottom line is that there is more debt in the world than ever before and most economists think that is not sustainable.

Is this the case? Economic theory will get you all possible scenario's from initial deflation to hyper inflation and show you many ways to calculate this. History partly proofs them right. When you study previous crises you will find events that you might interpret as cause and effect and repeating by logic.

The problem of fiat money and the financial system however is that it is highly fictitious. Bookkeeping is not exactly reality and figures are cooked and hardly reflect reality. We agree on things that we change all the time.

Fiat money is bad - no doubt about that. However: since years people predict the fall of the dollar and the fall of the Euro. For very good reasons. Would logic apply both currencies would probably be already history.

Why then do they exist? It's an act of will. An act of power. You can say the dollar has no real value because nothing backs it up. That is not true. It is the currency of the most powerful nation on earth and it is in the end backed up by an army in possession of nuclear weapons. The people that own and control most everything (elite's) need a system in place and need certain rates. You can say the ECB (Eurozone) has so much bad debt that will never be paid back and so will default. It will not unless elite's decide to let it default. If the Greek state will repay it's debt or not is not relevant. There is no logic verifiable mechanism for a default. Debt can be kept in the books over generations when necessary. The result of the debt in Greece is simply that all assets the country had are in the hands of the lenders. That was the design in the first place. Debt is power.

Fiat currency always fails in the end. Not because that is an economic necessity, but because somebody pulls the plug. That process is rightly called ICE NINE, a term brought into mind by James Rickard and taken from a book by Kurt Vonnegut (Cat's cradle). Another term that is used is the Big Freeze.

Not economical considerations trigger this, but considerations of power. Take a look at the EURO: it ate all the savings from the German Middle class and created enormous markets on credit. Not many people in Spain or Portugal were able to buy a Mercedes or BMW before they were in the EURO zone. And they could not because their incomes were all of a sudden higher. It happened because all could be financed. The car producers could sell without risk. The very same thing happened after 1989, after the fall of the Berlin wall. Car dealers were the first in the new markets and they would never have succeeded if fintech did not do their job. Everybody in the system knew very well it created a lot of toxic debt, but it was compensated by predatory interest rates and government support. Defaults were for the tax payer. That has always been the case. In 2008/9 states transferred tax money directly to banks, but before that the same thing happened in another way. Bailing out industries, manipulating markets in favor of industries, awarding cartels with legislation that made their business invulnerable against any market mechanisms. There never really was a free or liberal economy - western governments always acted on pressure from corporations. Energy, alcohol, tobacco, pharmaceuticals, cars and some other key production industries always could play above the law and write the laws if necessary. Volkswagen wrote German social law (Harz IV) and the story goes that the German Bundestag (parliament) just rubber stamped it without even ever reading it.

These elite's will sustain their fiat currency as long as it suits them. Indeed however these elite's want a change. Rickard calls it: one currency, one tax, one world government. Many things indeed point to that. ICE NINE indeed might be their weapon of choice when it comes to it. It makes a lot of sense.

What could be a consideration for Germany to unplu the Euro? With it it has taken the savings from their middle class, putting everybody in a class that is best called the consumer class (basically without political rights or structure). They might decide the scheme has done it's work and it is time for something new. That could be a currency reform. That would confiscate the last money held by individuals. The debts of other countries would default in such a scenario, but against that are the property rights on land and facilities. Greece for example sold most of it's assets - there is little more to grab there. A default would just lead to a restructuring in new currency definitions. If you own everything, you do not need the financial system to keep safe. You can change it by something more convenient.

At the same time the dollar, now reserve currency because of it's dominance in oil trading, might be sacrificed. A very logical scenario will be that SDR will be the new center and standard. It would allow confiscation of the last middle class assets in the USA just by leaving them with a worthless dollar.

In Rickards scenario banks and governments will freeze all assets within 48 hours, close down exchanges and force changes overnight. That is very well possible. Exchanges have been closed before. Banks have been closed for business before. Rumor has it that the real big wealth funds of this world (like Blackstone and Fidelity) are under pressure to leave their money in the system. Locked in the system.

The war on cash might very well be the first stage to prepare an ICE NINE event. People are tight to the financial system with little to nothing to fall back on when fiat fails. All locked into the system. That makes a freeze extremely effective.

Crypto will play no part in all this. It will not replace the money system. There is a very simple reason for this: the people that own and rule evrything (the elites) will agree on what basis they will trade oil, pharmaceuticals, banks, insurances and all other key commodity and control values. They will not buy bitcoin and take it from there... Last year many people in the crypto space got all excited by regulation and institutional investors coming into the market and rumour Goldman Sachs is looking into crypto. Their interest is purely technical and they take it as a small niche in their portfolio's if at all. The moment there is a benefit obvious, they will develop their own applications and obey the same owners of everything. People will never be able to escape from central authority with crypto. There are a few individuals that manage to do so - but these same people were there before crypto! PT is a very old thing, dating back further than the mobile phone and internet.

Our view is that the current monetary system is a walking corpse and radical changes will take place some time. That is not economics! That is power only. Elites do not think about what the economy means to them but how they run economy. If it is a walking corpse, so let it just walk on as long as it does the job. It will not drop down without permission....

All freedom is a window. Anarchy you might call it. There were a few years between perestroika and the declared victory of capitalism. In those years elites did not have their networks fluent, they had to get used to each other. It was hard in the beginning to find the right business partners in Russian for example since the country was really in chaos. Even the both Germany's had not figured out immediately how things should be run and made many mistakes in their initial solutions. For people that was a window of opportunity and an illusion of freedom. A similar thing is true for crypto. We exist ten years now and we are on the eve of capitulation. We will fade into the real world and obey. There is no such thing as a crypto revolution - there is an innovation in a lab space and when it proves to have benefits it will be owned by the same people that own already everything.

Will there be an ICE NINE event? We do not predict anything within any time frame. It is likely, it makes sense. Preppers might find themselves at the right side of the equation within our lifetime. Sure is you cannot trust the system. You are left without a clue and without any real power. Casse pipe like usual...

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