by Gary Christenson, Deviant Investor:

“We can ignore reality, but we cannot ignore the consequences of ignoring reality.” Ayn Rand.

The western world has ignored economic realities for decades. It’s not a Republican or Democratic problem. Banking, power, fiat currencies, dishonest money and transfers of wealth are the issues.

The consequences of ignoring reality are uncomfortable and dangerous. However, most people prefer palatable, easy to digest and believable stories.

In the United States, the U.K., Europe, and Japan it is comforting to believe:

Debt has increased exponentially for decades and for over 100 years in the US. We want to believe debt will grow for another century. (It won’t.)
Governments want to borrow, spend their way into prosperity, and pretend and extend indefinitely. (Not likely.)
It is comforting to believe our politicians and central bankers manage our countries and currencies for the benefit of the populace. (Don’t plan on it.)
Every major country uses a central bank. It is comforting to believe central banks are necessary. That delusion benefits the banking cartel and the political and financial elite.
It is comforting to believe gold is not necessary. Per Warren Buffett, we dig it from the ground and store it in a vault. Russians and Asians know its value and always want more.
It is comforting to believe in paper assets, debt based assets, fairy tales and the Easter Bunny. Gold, silver, platinum, land, and other real assets survive. Gold thrives, paper dies.

These comforting beliefs are incorrect and will be proven false in coming years.

The U.S. national debt has increased from about $3 billion in 1913 to over $21,000 billion ($21 trillion) in 2018. That is an average annual increase of about 8.8% per year. A similar debt increase for another 100 years will exceed $90,000 Trillion. Delusion!

The crisis of 2008 hinted that “peak debt” had arrived. The Fed and other central banks responded by creating more debt and took credit for saving global economies. More debt is not a solution. The coming implosion will be destructive.
Place one penny in a savings account at 6% annual interest and allow it to grow for 1,000 years. Your $0.01 has grown to a few hundred bucks—right? No! It has grown to $202,000,000,000,000,000,000,000. (Yes, the math is correct.)
Compound interest rapidly increases debt. Debt will not increase forever and a reckoning will occur. What is the value of a 30 year bond yielding 3%, issued by an insolvent government that cannot pay the interest without going deeper into debt?

CONSIDER:
Central Banks: Central banks and commercial banks produce paper and digital currency units that devalue all existing currency units. Central banks create profit for their owners and the financial and political elite. They are not beneficial for most people and small businesses.
Gold: The western financial and political elite claim gold is mostly useless. However gold has been money for thousands of years, is valued globally, and is convertible into paper and digital cash everywhere. An ounce of gold sold for about $42 in 1971 and sells for about $1,330 in March 2018 – a compounded annual increase of 7.6%.
Debt: The debt pyramid will crash and bonds and currencies will decline toward intrinsic value. Central banks will create more currency units to “paper over” the crisis and gold will increase in price as dollars devalue.

Ignoring Reality and the Consequences:
“We can ignore reality but we cannot ignore the consequences of ignoring reality.” The consequences are:

U.S. government spending and national debt growth are “out-of-control.” Expect continual dollar devaluation.

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