MP3 OF Radio Interview (http://www.netcastdaily.com/broadcast/fsn2012-0418-1.mp3)
JIM: Joining us as my special guest on the program today is James Rickards. He’s senior managing director at Tangent Capital and also author of the bestselling book Currency Wars: The Making Of The Next Global Crisis.
And Jim, I want to begin our discussion today on something that you did recently; you submitted a testimony to the Senate Banking Committee’s Subcommittee on Economic Policy called Retirement Insecurity: Examining The Retirement Savings Gap. And what I thought was rather unique about this, Jim, is that in the past the Fed has been held in high regard by Congress, the administration, by the public at large — in fact, I can remember days where they used to grovel every time Greenspan appeared before Congress and the same thing with Bernanke. In your testimony, you’re casting some doubt as to the effectiveness of that policy. Let’s begin with that. [1:33]
JIM RICKARDS: Well, the Fed has had this zero interest rate policy in place since 2009. It took them a while to get there; they started cutting rates in 2007 and actually got down to zero by December 2008; so using 2009 as a starting point, 2009, 2010, 2011, now into 2012, so it’s over three years. And the Fed is telling us they intend to keep it in place for three more years: 2012, 2013, into 2014. So if they stick to that, that’s going to be six years of zero interest rates. That’s completely unprecedented. We’ve never seen anything like that before in the history of monetary policy in the United States, and it’s not working. I mean unemployment is still high, the output gap is still large, growth is not back to trend, employment — that is, just the total number of people who have jobs, leaving aside percentages — is about where it was in 2000. We haven’t really added any jobs net since 2000, over 12 years.
So the Fed is sticking to the policy. Their view is they can kind of ease their way into growth and encourage spending, encourage borrowing; try to take some of the base money, turn it into M1 more high-powered money, try to get velocity going (which is just the turnover of money) and kind of get the GDP moving in nominal space. The problem is that I think the Fed has got the psychology all wrong.
The Fed can increase money as much or as little as they want; the Fed has very good control of the money supply. What they cannot control is velocity. Velocity is how quickly the money turns over; you know, do I take it and spend it, you know, take my friends out to dinner or do I stick it in the bank. Well, if I take my friends out to dinner and you know, the restaurant owner uses the money to buy some new equipment or whatever, that money starts to have velocity, which means it’s getting used; but if I take it and stick it in the bank, or if I take it and buy gold, that money has a velocity of zero because it’s not being used. So that’s something the Fed cannot control directly. That’s behavioral. It depends on how I feel and how you feel and, you know, how your listeners feel, whether we’re sort of optimistic or more concerned. If we’re more concerned, we’ll probably stick our money in the bank or buy gold or buy land or do something that just sits there because we’re trying to preserve wealth.
And so the dilemma for the Fed, having increased the money supply by several trillion dollars, how do they get velocity going again. Well, they have to affect behavior, which means they have to kind of play mind games and somehow make you worry about inflation or scare you into spending your money. So they think by holding interest rates low, they can encourage inflation and people will be spooked by the inflation and run out and buy that refrigerator or that car before the price goes up, and also try to increase lending because you know, interest rates are low and if they can get inflation above the level of interest rates, that’s actually a negative real rate. In other words, if borrowing rates are two percent, but inflation is three or four percent, that’s a negative real rate, which means you can pay back the loan in cheaper money; so it’s actually not only a low interest rate, it’s free money. The bank is paying you to borrow because you can pay them back in cheaper dollars. These are all ways the Fed is trying to get people borrowing and spending again.
The problem is they are sending the wrong message. When people see rates at zero, they know that the Fed is really concerned about deflation. The Fed is trying to encourage inflation because they’re worried about deflation. And people, correctly, read the signal and say, well, hey, if the Fed is worried about deflation, maybe I should be too. And the smart strategy in deflation is to buy hard assets or preserve your wealth, so just keep money in the bank but not spend it.
So I think the Fed is — they’ve got their theories, they’ve got their models. I think they’re mostly wrong. I think they think they are pulling the wool over people’s eyes. But they’re not actually succeeding. I think people understand that the Fed is concerned about deflation and they should be too, and so they’re not really having any success in getting velocity moving and getting the economy moving. [5:18]
JIM: But the prescription that they’re using, Jim, is exactly the prescription that got us in this mess: we’ve had the tech boom and bust, we’ve had the real estate boom and bust where people went out and borrowed money, they didn’t save, they spent money that they didn’t have. And what they’re really trying to do by keeping interest rates this low is they’re saying go out and do the same thing again. Go out and borrow money, go out and create a bubble in something with the wealth effect, or go out and spend it. I mean that’s why we have 50-something trillion dollars worth of debt today. [5:52]
JIM RICKARDS: Well, that’s exactly right. You know, there’s an old saying: Fool me once, shame on you; fool me twice, shame on me. Well, here’s the case where the Fed has tried to fool people four times. And this really goes back to 1998 with the near collapse of Long Term Capital Management, but that was a bailout; government money was not used in that, it was private money, but the Fed did play an instrumental role in bringing the major Wall Street banks together to orchestrate that bailout. And once the bailout was done, the next day the Fed cut interest rates and then about 10 days later, the crisis still wasn’t quite over so they cut interest rates again. So that was the signal.
What that said is, you know, when push comes to shove, if we have to bail out the system, we’ll cut interest rates. Well, the signal to Wall Street was: Let the party begin, the Fed’s got my back. That was the beginning of the famous Greenspan put. What we got out of that between 1998 and 2000 was the tech boom, then that crashed. Then the Fed cut forward interest rates down again, they held them low and we got the housing boom and that crashed. And then in 2008 we got a crash of the banking system. So it’s been one crash after another and now the Fed is trying to do it again. I agree with you. But people have wised up; they have lost too much money, they’ve seen their home equity go negative, they’ve seen their 401(k)s wiped out, they’ve seen their spouses unemployed, they’ve seen the student loans and the credit card loans pile up and the government debt pile up and they say, hey, this is not going to work this time. So the Fed is trying to run the same playbook, but people are wise to it. They are not going to be fooled again. And so that’s one of the reasons it’s not working. [7:20]
JIM: You know, recently I had a doctor come in as a client and he had just retired with his pension and savings, had close to over $2 million and the comment he made to me: I never thought I would have this kind of money and that it would buy so little. That’s because, you know, if you were to go back 10 years ago or even 20 years ago and you had $2 million, you were thinking, okay, I can invest that in bonds and a get a 6, 7 or 8 percent rate of return. Here, this gentleman is facing — I’m looking at a Bloomberg screen today where the interest rate on a one year Treasury is less than two-tenths of a percent, less than three-tenths of a percent on a two year Treasury. So what he was basically saying is: I have all this money but it buys me very little. Isn’t that the Hobson’s choice that retirees are facing today? They either gamble with their money or they get nothing at all. [8:15]
JIM RICKARDS: Well, that’s right. And it’s funny you say Hobson’s choice because I think that is a good choice of words. Now, a lot of people think that Hobson’s choice is two bad choices, but it’s actually, the origin of the expression means you have no choice at all. Hobson ran a livery and he hired horses and when you went in to hire a horse, he would only give you one choice; you couldn’t pick any horse in the stable. So Hobson’s choice is, in effect, no choice. And that’s what the Fed is offering savers. They’re saying we are going to pay you nothing to be in Treasury bills, nothing to be in money market funds, nothing to leave your money in the bank, you’re not going to get anything, any return for those types of savings and investments. So you have no choice but to go into the stock market or the property market, which are very risky and volatile assets.
The problem there — and actually, stocks have been going up pretty strongly this year and last year, and I actually think they are going to continue to go up throughout 2012, not for any good, fundamental reasons, but just because all the central banks in the world are printing money at once. Wall Street loves free money so I would expect the stock market to continue, but it’s just another bubble and that will crash. And when that happens people are going to find that, once again, they’ve lost 20 to 30 percent of their wealth.
So just take the client, I think it’s the dentist that you mentioned, well, he’s got $2 million; it sounds like a lot of money and in many ways it is. But if you had just 4 percent inflation and you know, 4 percent inflation is not Weimar Republic hyperinflation, it’s not even as bad as the 10 to 13 percent inflation that the United States had in the late 70s and early 80s. Four percent sounds kind of warm and fuzzy, but that will cut the value of a dollar in half in 17 years.
So let’s just say the person you’re referring to is maybe, I don’t know, maybe 65 years old. Well, in 17 years he’ll be 82; you know, 82, he could very well live that long — in fact, that’s the normal life expectancy for a 65 year old. So the value of that $2 million could actually be cut in half before he is even done trying to live off it. So 4 percent is cancerous. And if it’s any worse than that, if you get into 5 to 6 percent inflation, then the value of that is going to be cut even more.
Well, that’s sort of the best case, meaning if you put it into the bank at zero or one percent and we start to get 3, 4, 5 percent inflation, the value of that money is going to be cut in half. But what if he says, okay, I’ll protect myself and go into the stock market and now suddenly the stock market drops 20 percent because we have another bubble, you know, he could lose $400,000 in a matter of weeks and then, still suffer inflation if he gets out and gets into cash. So this is just crazy. We’re not really giving savers or investors any good options and the reason is the one you mentioned, which is that the Fed is trying to drive the economy off of consumption.
They’re saying, hey, you know, forget about savings, go spend the money because here comes inflation. But that’s not the only way to drive an economy. You could drive an economy with investment. In fact, investment is a much better way to drive an economy because investment is kind of a two-fer; you get GDP when you make the investment and then you get more GDP down the road because you improve productivity as a result of the investment.
Consumption is a one time thing; if I go buy something, I consume it and that’s it, but investment pays off year after year after year. And that’s the really the best way to drive an economy and that’s what Germany does and that’s why Germany has been able to power through this financial crisis. And it’s also one of the reasons that the euro continues to be strong despite all the prognostications and the wailing and the complaining. The fact is the euro has done extremely well because they’re more investment oriented than we are.
And so I’d like to see a world where the Fed raises interest rates, not to punish borrowers, but to reward savers and encourage people to save, making the United States a magnet for investment from around the world. Let’s get some GDP by foreigners putting money in this country to, you know, build infrastructure, whether it’s pipelines or other kinds of innovate technologies, manufacturing, et cetera; make the US a destination for investment. Drive the economy off of investments instead of consumption and grow it the right way through innovation, technology, savings, investment, improve productivity rather than lend and spend. [12:12]
JIM: Jim, do you think what is really needed here is as you just mentioned, is not only raising interest rates to reward savers because savings provide the capital for investment, but what about tax laws. Take a look at tax laws today; if I go out and borrow money and go into debt as a corporation I get to write off the interest; if I’m a consumer and I go out and get a big mortgage on my house, I can write off that debt, but if I am a corporation and I pay a dividend, first of all, I’m going to get taxed on that dividend or the profits I make, then I distribute that dividend to my shareholders, they’re going to get taxed on it. Shouldn’t we have a combination maybe of tax laws that favor investment; reward people for saving, number one, and investing, number two. But what we’re talking about doing next year is basically a tax on investors in the form of an additional tax on interest and dividends, raising the capital gains. So it’s almost like: why invest if you want to tax me more for doing so? [13:20]
JIM RICKARDS: Well, you make some very good points and those are good examples, but that’s just the tip of the iceberg. The US has an extremely hostile business environment and extremely out of control, anti-business, anti-savings-and-investment tax code. So I would go much further. I would eliminate corporate income tax; there are very straightforward ways of doing that. Basically, treat every stock holder in a corporation no different than a partner in a partnership. Partnerships and LLCs don’t pay taxes; they are conduits. Whatever money they make just shows up on your individual tax return, so it’s not that it escapes taxation, it just is taxed at the individual level rather than the entity level.
Well, why not treat corporations the same way. Repeal the corporate income tax completely — and that would obviously be very favorable to investment — and then say to an individual, hey, if you’re a stock holder on a certain date, you’re going to report your share of the income on your personal tax return. And then of course the corporations would be motivated to make distributions to help people pay that or you could put it on some kind of deferral basis, but there are ways of doing that. The computing power that we have today makes that much more feasible than it would have been in the past. So it eliminates corporate income tax. Every economist agrees that corporations don’t pay corporate income tax; they are just tax collectors for somebody else.
It is true that corporations file tax returns and hand over checks to the government, but it’s coming out of somebody’s pocket; it’s coming out of either the stock holder, the customer, you know, investor — it’s coming from somewhere in the form of pricing. So it’s just an inefficient tax collection mechanism. It should be eliminated.
I would also eliminate the capital gains tax. I mean how do you get a capital gain? Well, you have to go buy something and then it has to go up and then you sell it and there’s your capital gain. Well, you’re buying it with after-tax dollars. You have to make money first, pay taxes on it and then take what’s left over, make your investment and if you have a gain, you get taxed again. So it’s another form of double taxation; I would eliminate that. So I’d eliminate the corporate income tax, eliminate capital gains taxes, get rid of a lot of regulation; I’d actually have more regulation on banks and less regulation on other non-bank businesses that are actually producing real things. And the result would be a more favorable business climate
And again, it would not just help savers and investors and entrepreneurs in the United States, it would make the US a magnet for investment from around the world. All of a sudden, Chinese, Brazilians and Indonesians and others would start to look at the United States as the place to be, as opposed to Asia or some of these so-called emerging economies. And that can drive GDP.
So there is a formula for growth. I don’t think all is lost. I think America can have a very robust growth, but not with the policies we have today. And that’s just the beginning.
I look at the Great Depression and there’s been a lot of scholarship on the causes of the Great Depression and that’s important work, but I’ve always been more interested in why the Great Depression has lasted so long. I mean what caused it is interesting, but why did it last 10 years when other depressions in US history lasted like one to two years, more like 18 months.
And the best answer I’ve found is what economists call “regime uncertainty”, meaning, you know, in the 1930s, FDR put on price controls on cotton and then started price supports on cotton; and the next year we got too much cotton and they took away the price support. He confiscated gold. He tried to pack the Supreme Court. In other words, you never knew what FDR was going to do next. So regardless of the merits of each individual move, the fact that you never knew what was coming, if you’re a businessman, you just stand to one side.
Well, we have the same situation today. Let’s say you’re a major corporation or you’re an entrepreneur or a venture capital type investor and you’re trying to figure out what to do with your money. Well, you look around and you say, gee, will Obamacare be the law or will it be overturned by the Supreme Court; will the payroll tax cuts be extended; will the Bush tax cuts be extended; what’s happening with cap and trade. You go down the list; there are so many uncertainties that the sensible person would say, you know what, I’m out of the game, I’m going to go to the sidelines and wait until I get some clarity. Or, invest abroad in India or someplace where you know what’s going on.
So we’ve got an awful tax system, it’s confiscatory, it’s inefficient. We’ve got regime uncertainty. We’ve got a lousy investment climate. It’s no wonder the economy is not growing. [17:36]
JIM: I want to talk about — you just mentioned a very unfavorable tax climate and with Japan lowering its corporate taxes, the United States now has the distinction of the highest tax rates in the world. But there’s something else that’s been very negative that you’ve written about in your book and that is these currency wars where countries try to manipulate their currency to gain an unfair trade advantage.
And I think the figure is like total foreign currency reserves have increased by something like 7 trillion going back to the 1970s. Well, there’s been a lot of money printing. So like if I’m a Chinese manufacturer, I sell goods to the United States; they pay me in dollars and I take those dollars back to China. Now, if I’m going to exchange those dollars into the local currency, that’s going to drive the value of that currency up. But instead, I do exchange those dollars, but the Chinese central bank prints money to buy those dollars to keep their currency where it is.
Let’s talk about the effect of currency in terms of its impact on our economy. 18:44
JIM RICKARDS: That’s a very good description and that’s exactly what happens. The currency — foreign exchange rates or the relationship of one currency to another can be thought of as a conveyor belt that moves inflation or deflation around the world. And that’s exactly what the currency wars are.
The simplest definition of a currency war is when one country tries to devalue its currency relative to others in order to promote exports and create jobs.
So the way I like to analogize it is imagine you’re in a small town and there are four stores and they all sell more or less the same thing, but one of the stores has a half-off sale. Well, where’s everybody going to go? They’re going to go to the place that has the half-off sale.
Well, it’s no different in global commerce. There are a certain number of countries that manufacture jet aircraft; the United States has Boeing, Europe has Airbus, Brazil has Embraer and there are a couple of others. Well, let’s say you’re Thailand or Indonesia or Australia and you want to buy aircraft for your aircraft industry but you don’t make them yourself, well, you have to go shopping. But where are you going to go? You’re going to buy from Boeing or buy from Airbus. The theory is that if you cheapen the dollar, that’ll make the Boeing aircraft a little more attractive and Boeing will sell some planes and create some jobs. It sounds good. In fact, it sounds really good. It sounds so good that the politicians can’t resist it, but in fact, it doesn’t work that way because nothing happens in a vacuum. The United States is not the only actor.
And once you go down that road, you very quickly invite retaliation. Other countries say, well, hey, two can play that game. We’ll devalue our currency too. Or, if we don’t think we have the clout to devalue the currency, we can put on capital controls, we can put on exchange controls. We can put on tariffs — excise taxes — and that’s how the currency wars turn into trade wars.
So once you take the retaliation and unintended consequences into effect, you end up with a contraction in world trade or something like the depression in the 1930s.
Or the other thing you do is import inflation from abroad; people say, well, gee, cheapen the dollar and increase US exports; make export prices less expensive. Isn’t that a good thing?
Well, people forget that the US is not just an exporter, we’re an importer also. We actually import than we export. So if you cheapen the dollar, the price of those imports is going to go up, which brings inflation into the United States from abroad. If we’re paying more for iPads and iPhones and flat-screen TVs and French wine and vacations in Italy or whatever it is, foreign fashion, clothes made in Korea, you name it, all those things are going to get more expensive if the dollar gets cheaper. So this brings inflation into the US and that’s why it’s a losing game. It always ends badly.
It’s happened several times in the past as I point out in my book, but that initial kind of feel-good phase where you’re improving your exports a little bit is very hard to resist and that’s why the politicians do it. But it’s just leading to another disaster. [21:30]
JIM: There are a lot of academics out there, Jim, who are arguing that this rate of inflation or what they call financial repression — I’m thinking of Carmen Reinhart’s recent piece — where she said, if you run an inflation rate in that 4 percent range you’re talking about, over time, in nominal terms, US debt gets paid with cheaper dollars; [it] becomes a smaller percentage of nominal GDP.
And she points out this is what we did after World War II and there is almost a recommendation from a policy point of view; our debt is so large that it ought be prescribed as a solution to our current debt problem. But as you just pointed out, in the case of my doctor client, at a four percent inflation rate, given his current age of 65, by the time he ends his life his purchasing power is going to be cut in half. [22:28]
JIM RICKARDS: Well, that’s exactly right. And the problem with inflation — I mean you’re right in describing — I mean Carmen Reinhart is an excellent economist and analyst and she’s produced some excellent research. Whether she’s recommending this or not almost doesn’t matter; what’s important is that she’s correctly describing it and pointing it out. And it’s absolutely what the Fed is doing. There’s other evidence of this, but that’s exactly right.
Look, the debt is unpayable. There is too much debt. Around the world, sovereign debt, corporate debt, consumer debt, individual debt, student loans, car loans, the national debt, et cetera, there is just too much debt that can’t be paid. There is no combination of inflation and taxes — there’s not a combination of growth and taxes that’s going to get you there. So there are only a couple of ways out.
The first way out of this is to default and we’re seeing that in Greece and we’ll see it in other countries around the world. The US is not going to default; there’s no reason for the US to default. We can just print the money. So just say to China, hey, China, we owe you $2 trillion, here you go. You know, print up $2 trillion and hand it to them; and good luck buying a loaf of bread because it’s not going to be worth very much but you’re getting your money back.
So that’s what governments prefer to do: If you have your own currency, you don’t have to default, you can just inflate your way out of it. But inflation means you create a set of winners and losers. It doesn’t do you any good if you have 6 percent inflation but interest rates go up 10 percent. That’s actually a drag on the economy, those are very high real interest rates. So what you have to do is create negative interest rates where the inflation rate is higher than what the savers get.
So basically you punish the savers who live on what the banks can pay, either directly or indirectly, and get the inflation going so that inflation is higher than what you’re making and that means you are losing money in real terms.
Now, the problem with inflation is not everybody loses, but there are winners and losers. The losers are the savers and retirees, people on a pension, people like your doctor client who are going to see their wealth erode unless they invest in gold or do something to defend themselves.
The winners are banks, hedge funds, speculators, people who got into gold, people who understand what we’re talking about and do something to protect themselves. So it’s not as if inflation is spread evenly across the whole population; what you have is a bunch of winners and a bunch of losers. So the losers generally speaking are the savers. [24:46]
JIM: You know, something that’s rather interesting and what you’re describing here, earlier in our conversation you said that a lot of people are getting wise to what the Fed is doing. And I wonder, Jim, if this is why we are seeing for the twelfth consecutive year the price of gold go up. I mean the Fed was doing this in the 90s; Greenspan was inflating, but it was going into the stock market and the tech stocks, everybody was feeling good. People weren’t buying gold. You take a look, the tech bubble burst, the real estate bubble burst, so people have been burned twice now.
And I think, as you said earlier in the conversation, there are a lot more people who are getting wiser to this and saying, you know what, if you’re going to continue to do this, I’m going to take evasive action or at least something to protect my purchasing power because I don’t want to end up 10 years from now or 20 years from now with what I have in savings worth half what it’s worth today.
Do you think this is why we’re seeing gold go up? In other words, it’s becoming the ultimate currency? [25:49]
JIM RICKARDS: It is one of the reasons. Throughout the late 90s and even well into the 2000s, how many times did you hear the expression, buy and hold, buy and hold with regard to the stock market?
And Wall Street was preaching this to investors and saying, hey, there will be dips, there will be volatility, there will be business cycles, it’ll go down sometimes, but just buy and hold, hang in there; stocks for the long run, give it enough time and you’ll do well.
Well, that has turned out to be a complete lie. Stocks are just about where they were in 1999 — a little bit higher but not much. In 12 years, stocks have not gone up much at all. Now, they’ve been volatile, they go up and down, up and down; I’m not saying you can’t make or lose money along the way. But for the buy-and-hold investor, they’ve made nothing in the stock market in 12 years except possibly some dividends, whereas gold has gone up 700 percent — I’m sorry, 800 percent; from $200 an ounce to $1600 an ounce.
So I think that’s beginning to sink in. I think people are beginning to get it. Having said that, gold is nowhere near a bubble; people are so underinvested in gold. Institutional allocations are about one-and-a-half percent; they might be 60 percent in stocks and, you know, 30 percent in bonds and 10 percent in alternatives — hedge funds and so forth — and there’s only kind of a skinny little one percent in gold.
I mean if institutions just doubled their allocation from say one-and-a-half percent to say three percent, there’s not enough gold in the world at these prices to absorb that kind of inflow. And so this is nowhere near a bubble. And people see what happened last August, gold had a mini spike, a mini super-spike up to $1900 an ounce and came back down to the $1500 range. It’s a little bit higher since then, but that scared a lot people, and you know, spooked a lot of people to worry about gold.
But the fact is, gold is volatile. It’s not for the weak of heart, but it will be the only thing that kind of saves you in the long run because it will preserve wealth once this inflation kicks in, which I do see coming. So it’s not a bubble. It’s volatile. But you know, I wouldn’t apply buy and hold to the stock market, but I would apply it to the gold market: Buy some gold, put it away and ignore the daily fluctuations and sleep well at night and give yourself some comfort that you’re going to preserve your wealth. [27:57]
JIM: Jim, a final question. Let’s say I’m the next president of the United States. I appoint you as my Treasury secretary and I’m saying, Jim, we’re in a mess, we need to dig our way out. Very quickly, what would be the key steps that you would take to change the current course that the country is heading on? [28:15]
JIM RICKARDS: Well, the Treasury secretary has control of certain things, not everything, but he does have what’s called a “bully pulpit”, which is the ability to try to influence the debate. So as a set of policies, I would call upon the Fed to raise interest rates — not a lot but maybe 50 basis points, but some signal that rates are going to start to go up as a way to reward savers as we discussed earlier.
I would immediately get the experts and begin a massive reform of the income tax system, also, along the lines we discussed of eliminating corporate tax, capital gains tax, simplifying the personal income tax and cutting rates. And I believe we could actually raise revenues by getting rid of all the loopholes and the deductions and inefficiencies and lower the rates and just make it really simple and people would actually end up, you know, the total collections would be higher because you got rid of all the loopholes, but it would be a more fair system, you would have more popular support.
And I would also have a real strong-dollar policy. Today, the Treasury will talk about a strong dollar but they don’t mean it, they actually want a weak dollar. So I would say I’ll raise interest rates to reward savers, pursue a strong dollar policy and reform corporate income taxes and personal taxes. And those would be three things the Treasury secretary could do on day one to create a better business environment and help get the economy moving. [29:33]
JIM: All right. Well, listen, Jim, I want to thank you for joining us on the Financial Sense Newshour. Hopefully, some members of Congress will start listening to you because I think we’re currently on the wrong direction and if we go in this direction, I don’t know what’s going to happen, but it’s certainly not helping savers.
We’ve been speaking with Jim Rickards. He is a partner at Tangent Capital and also author of the bestselling book Currency Wars. Jim, I want to thank you for joining us on the program.
JIM RICKARDS: Thank you. Glad to be with you.