US dollar “backed by bananas”

Press TV interviewed Paris-based financial analyst Max Keiser on the US financial meltdown on September 20. What follows are his free-wheeling comments on the US government bailout of Wall Street and the potential consequences for America.

“We have a treasury secretary in America – Hank Paulson. I’m afraid he’s gone insane. He’s become like the Colonel Kurtz of Treasury Secretaries. He’s gone native. He’s co-opted trillions of dollars of American taxpayers’ money and he’s playing hedge fund like a rogue trader. We have got a rogue trader in the Treasury Secretary’s office. He’s being aided and abetted by Ben Bernanke who’s been discredited as the entire Federal Reserve Bank has been utterly discredited. We’re looking at a possible inflationary depression in America and the worse is yet to come, much worse is yet to come.”

“To pay for all this insanity from Hank Paulson, they have two options. They can either raise taxes or they can inflate the money supply. They can destroy these things US dollars [waves a dollar bill at the camera]. Dollars 30 years ago used to be backed by this stuff – gold [waves a gold coin at the camera]. Now thanks to Hank Paulson and Ben Bernanke US dollars are backed by these – bananas [waves a banana at the camera]. They’re absolutely worthless. Anyone buying US dollars today is going to lose money.”

“For the average American, this is what they will experience. The price of food and oil are going to skyrocket due to hyperinflation. The only way they can possibly pay for all these bailouts is to inflate the money supply. This means hyperinflation in America like you had in Germany in the 1920s. This is what the average American will experience: destitution, poverty, social unrest due to flagrant bank mismanagement – and it could have been avoided. But unfortunately the banks in the USA are run by greedy, insane private marketeers and this is the result.”

“It’s not really a doomsday scenario for the rest of the world. Take Iran for example, you’ve got a lot of oil and gas. Those prices are going to go up. China has huge savings. The Indian people have huge gold reserves. For the rest of the world this is actually a fantastic thing. Only the US and Britain are going to experience this horrible disconnection with the rest of the world economy. So it’s a doomsday for them but there’s a certain symmetry here. They spent 20 or 30 years with this neoliberal model hoisting trillions of dollars of debt onto themselves and now it’s gone belly up.”

“Well if you go back to the 1970’s when a similar inflationary spike hit the country you had Paul Volker who was an excellent Fed Chairman, probably the best of the past 100 years – much better than Alan Greenspan or Ben Bernanke who have really discredited the Federal Reserve Bank. Paul Volker at that time did what had to be done which was which was to raise interest rates. You’ve got to force the recession’s last depression onto the American economy but it’s necessary. This is what the next president is going to face – a choice which is not going to be tenable for the American people. They’re going to have to experience a severe economic contraction so that there is some balance restored to the economy.”

“Unfortunately the fear at this point is that is that the laws have been changed. Hank Paulson has done a power grab. When George Bush came into office he did a power grab. When 9-11 happened they did another power grab. They have dictatorial powers now. So now you’ve got this lunatic, Hank Paulson with a multi-trillion dollar hedge fund who’s basically running the economy like a rogue trader.”

“Hank Paulson has a multi-trillion dollar hedge fund and he doesn’t appear to be in control of his own mental faculties. He appears to have gone insane.”

“There wasn’t really ever a strong American economy. There was a lot of debt over the past 30 years and this debt has built up. Just look at the average American. They weigh 300 pounds, they waddle around the malls shopping all day. They’re not healthy. This is because there’s too much debt in the system, too much easy money. Cheap money is what created this problem and it’s been going on for 20 or 30 years. Unfortunately the labor movement in America has been decimated. They’ve been told for 20 or 30 years that it’s a trickle down economy and that everyone can get rich in America.”

“The problems are here but the people who created this nightmare are gone. Cheney has already got his Halliburton corporation headquartered in Dubai. He’s already out of the picture. All these crooks are going to be leaving this country. They’re not going to stay for all of the rioting there’s going to be in America.”

“Remember in Karachi a few weeks ago there was rioting at the Stock Exchange because of the very same thing that Paulson and Bernanke are doing today on the New York stock Exchange, imposing price-fixing and government intervention.”

WY/HAR

Source: http://www.presstv.ir/detail.aspx?id=70069&sectionid=3510302