Coin Stories Daniel Lacalle: Raising Taxes Won't Fix the'Debt Bomb' and Why Currency Debasement is "Intentional"
Oct 29, 2024
Daniel Lacalle, a Spanish economist and author, delves into the implications of recent Fed rate cuts on the economy. He argues that currency devaluation is intentionally orchestrated and that merely raising taxes won't alleviate national debt. Lacalle critiques how government dependency undermines the middle class while benefiting elites. He paints a grim picture of unfunded liabilities, linking them to currency debasement. Additionally, he highlights Bitcoin's emergence as a promising asset against inflation, alongside traditional forms like gold.
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Fed Cuts Bail Out Treasury Debt
- The Fed cut rates preemptively to support Treasury yields amid high government debt issuance.
- This "bailout" disguised governmental insolvency problems despite robust economic data.
High Taxes Don't Reduce Debt
- Raising taxes is not a solution for reducing high national debt.
- Countries with high taxes often have high debt and deficit spending persists despite tax hikes.
Government Debt Growth Is Unproductive
- Debt spending only boosts GDP if it funds productive investments with fiscal multipliers.
- Currently, each new dollar of government debt generates just 50 cents of GDP, showing debt is unproductive.