Ron Paul: Negative Interest Rate Bonds Is ‘Biggest Bond Bubble in History and It’s Going To Burst’
Sept. 17, 2019 (EIRNS)—Former congressman Ron Paul told CNBC’s “Futures Now” show on Sept. 12: “We’ve never had as many currencies in negative interest rates. $17 trillion worth of bonds [are] in negative interest rates. It’s never existed before. And, that’s a bubble. So, we’re in the biggest bond bubble in history, and it’s going to burst.”
He continued: “You can’t predict exactly where the creation of credit goes. We have a ton of inflation with all that QE [quantitative easing]. And, every time you lower interest rates below market levels and create new credit, that’s a bubble.... You don’t know this precise time. But you know it can happen.”
Paul’s comments are useful, but they miss the point Lyndon LaRouche repeatedly emphasized with the aid of his “Triple Curve/Typical Collapse Function” pedagogy: It is the unitary interaction of three distinct processes—monetary aggregates, financial aggregates, and physical economic parameters—that define the economic dynamic overall. Paul, and others, not only sidestep or even ignore the decisive physical economic process; but they also consistently mistake the mere monetary bubble for the total financial aggregates bubble—i.e., the derivatives cancer which is two orders of magnitude greater ($1.5 quadrillion) than the admittedly huge bond and other debt bubbles. But the latter are merely the trigger for the former, whose explosive charge is what will level the entire trans-Atlantic financial system unless it is placed through bankruptcy reorganization.