PETER SCHIFF ATTEMPTS TO EXPLAIN WHAT MAKES AN ECONOMY GROW

GT says: People SAVE...those savings are BORROWED by people/companies who use those savings to PURCHASE CAPITAL GOODS which are then used to PRODUCE other goods for sale. THIS IS CALLED PRODUCTIVITY. If SAVING is not rewarded, or those assests SAVED lose value due to the form in which they are saved (fiat money), then there is no INCENTIVE TO SAVE, and there will be NO SAVINGS from which those who want to PRODUCE GOODS can BORROW to PURCHASE CAPITAL GOODS (machines, etc.) to produce goods. Therefore, there will be NO PRODUCTION, ONLY CONSUMPTION of the remaining goods available. And the PRICES (in terms of the de-valued fiat money) WILL INCREASE to compensate for the SCARCITY OF THE REMAINING GOODS. NO PRODUCTION WILL OCCUR until the MEDIUM OF EXCHANGE is once again TRUSTED by the populace. This, of course, will NOT OCCUR until the OLD, WORTHLESS MEDIUM OF EXCHANGE (the over-produced fiat money $$$$) is REJECTED, or RE-VALUED, in terms of a REAL, NON-COUNTERFEITABLE MEDIUM OF EXCHANGE is used as the basis for its VALUE. THIS MEANS GOLD AND OTHER PRECIOUS METALS! Peter Schiff: Obamanomics = Food Lines Video Interview Click her to view http://informationclearinghouse.info/article21915.htm