Bestselling author Richard Duncan is back with a new book warning that
the world is heading into a depression, and that drastic and farsighted
action must be taken immediately to avoid an economic collapse.
The New Depression: The Breakdown of the Paper Money Economy (Wiley;
April 2012; Hardcover and ebook; $29.95; ISBN: 978-1-1181-5779-4) traces
the origins of this crisis back to the abandonment of the gold standard
in 1968. Over the following four decades, total debt in the United
States expanded from one trillion dollars to 50 trillion dollars. That
explosion of paper money-denominated debt transformed the world by
generating unprecedented wealth, profits, jobs and tax revenues. In
2008, however, the debt could not be repaid and the global economy was
plunged into crisis.
Duncan argues the current economic system is not Capitalism, but
Creditism; and that Creditism requires credit growth to survive. Yet the
overloaded private sector can bear no additional debt and the
government’s creditworthiness is deteriorating rapidly. Should total
credit begin to contract significantly, the economy will enter a New
Depression with disastrous economic and geopolitical consequences.
“The first step toward finding a lasting solution to this crisis is to
form a realistic understanding of the nature of this economic system –
not as it used to be and not as any particular group thinks it should
be, but as it really is,” writes Duncan. “Only then will it be possible
to devise a strategy that could correct its faults.”
Duncan’s solution is bold and contrarian. He argues this crisis has
created an unprecedented opportunity for governments to borrow at
historically low interest rates and invest in transformative industries
such as renewable energy, nanotechnology, genetic engineering and
biotechnology. Large scale, government-financed investment programs in
those industries would generate enormous investment returns and set off
a new technological, productivity-enhancing revolution that would end
the crisis and improve the wellbeing of everyone on this planet.
Duncan also introduces an analytical framework, the Quantity Theory of
Credit, that explains all aspects of the calamity now unfolding: its
causes, the rationale for the government’s policy response to the
crisis, what is likely to happen next and how those developments will
affect asset prices and investment portfolios.
Other topics in The New Depression include:
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The causes of the global imbalances that have destabilized the world
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How the economic crisis will evolve over 2013 and 2014
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The geopolitical consequences of a new great depression
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Wealth preservation through a diversified portfolio
Using historical data and practical investment knowledge, Duncan offers
solutions on how to avoid the worst of The New Depression.
Link to CNBC "Squawk Box" interview on August 20. 2012
http://video.msnbc.msn.com/cnbc/48722546/#48722546
