The Congressional Budget Office reports that unfunded government liabilities, primarily entitlements, exceed $100 trillion in net present value, a critical issue not addressed in debt ceiling discussions.
To tackle the $100 trillion in unfunded liabilities, Rick Rule suggests devaluing the dollar, which could significantly diminish purchasing power for millions of Americans.
During the 1970s, when the dollar’s purchasing power decreased by 75%, gold’s price surged from $35 to $850, demonstrating its potential as a store of value during economic uncertainty.
The U.S. debt ceiling is described as “fraudulent” by Rick Rule, as it’s routinely bypassed through procedural maneuvers, rendering it ineffective as a fiscal constraint.
Rick Rule anticipates social tension and blame-shifting due to the government’s $100 trillion in off-balance sheet liabilities, urging individuals to take control of their financial future.
In the 17th-18th centuries, Peter the Great imported European scientists, craftsmen, and talent to boost Russia’s economic and military strength, with the first Russian industries founded by foreigners.
From 1885-1913, Russia’s annual industrial production growth averaged nearly 6%, surpassing Britain, France, and Germany, despite starting from a lower industrialization level.
By 1899, British capital accounted for nearly 3/4 of all invested capital in Russia, with foreign companies producing 60% of Russia’s coal in the late 19th-early 20th centuries.
Foreign firms dominated key Russian industries, including German-led electrical construction, British-led agricultural machinery, and sugar production (with Jewish firms producing over half of Russia’s refined sugar).
In the late 19th-early 20th centuries, domestic minorities such as Jews, Baltic Germans, and educated Poles supplemented the work of foreigners in driving Russia’s industrialization.
Dr. Shelton advocates for a quasi gold standard with gold redeemability clauses in Federal Treasury bonds to provide a stable anchor for the monetary system and reconnect currency to gold.
Establishing a 50-year Treasury bond linked to gold would signal a move toward sound finances, allowing bondholders to choose between dollars or gold at maturity.
Dr. Shelton argues that mild deflation is a natural result of technology and innovation, not a monetary policy problem, but rather a symptom of inefficient government management of economic resources.
The Federal Reserve’s 2% inflation target is based on Keynesian psychology and money illusion, potentially leading to the deception of workers unaware of the dollar’s value deterioration over time.
The Federal Reserve engages in quantitative easing by buying government debt and mortgage-backed securities, but now pays banks 4-4.5% on $3.3 trillion in cash reserves, resulting in annual losses of $140 billion.
The Fed’s independence is based on not needing Congressional appropriations, but its losses are not funded by Congress, as it pays banks to keep cash reserves instead of making loans.
Dr. Shelton advocates for supply-side policies under President Trump to unleash the private sector, increase supply, and reduce inflation, rather than the Federal Reserve’s approach of choking demand.
Revaluing gold to its current market price could generate a windfall profit of $700 billion, potentially funding a gold-backed bond and capturing profit by selling bonds collateralized by gold.
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