Circling Le Drain

One possible reason why gold is setting new records in dollar terms is fear of default; i.e. a growing realization that some governments are on the verge of stiffing their creditors. Today, default is becoming a possibility not just for third world backwaters, but for large economies such as France. The reasons are simple enough, as this video explains. France is spending itself into oblivion thanks to pensions that pay out more in benefits than a working person earns.

17 Replies to “Circling Le Drain”

  1. Why was the economic impact of unchecked immigration since 2015 skipped?
    “The economic challenges extend beyond first-generation immigrants to their descendants. OECD data cited by the OID reveals that 24% of young people born in France to immigrant parents were not in employment, education, or training (NEET) during 2020–2021, the second-highest NEET rate in Europe and the Western world, behind only Belgium. This high rate of economic inactivity among second-generation immigrants suggests a failure of integration…”
    https://blog.alor.org/the-economic-cost-of-migrant-based-diversity-in-france-by-richard-miller-londonistan

  2. How much worse will it be for France when their African slaves demand emancipation from the CFA currency system?

  3. Europeans, including the presenter in the video, seem to ignore a basic idea in economics. They do not understand how wealth is created. They seem to view wealth as a static and eternal thing that needs to be divided up and distributed. They also see no problem with growing the size of government in the forlorn hope that government largess can create wealth, something that never happens in the real world. You can see this effect by comparing the GDP growth in the US vs the EU in the past couple of decades. The EU economy went from being comparable the the US to being about half the size in a relatively short period of time. Europeans seem to ignore the most important first step to increase the rate of wealth creation: the reduction of regulation.

      1. If you took out government spending, which in France accounts for over half of the economy, there wouldn’t be much growth at all.

        1. Are you kidding me. All money spent by the government was stolen from taxpayers who would have used that money to grow and enrich the economy as was done through many periods in the past.

          The Industrial Revolution, for example, wasn’t driven by government spending.

          Government spending can only come from sucking money out of the economy now or in the future via debt.

    1. That is the socialist mindset…..take the wealth created by the private sector and distribute it…..gee, that sounds a lot like communism.

  4. How does the “rise of populism = Democratic decline”? … and why is this man calling skepticism in global warming (implied ignorant) simplistic denialism?

    Sorry, I don’t put much stock in people who speak in these terms.

  5. Socialism, a form of government invented so that power hungry psychopaths could get elected by greedy and ignorant voters.

  6. France’s federal debt is 113% of annual GDP, but the US’s federal debt is 124%.

    Whether this is truly worse is debatable, given that the manner government debt is calculated vary from country to country. But it’s clearly bad. Even approaching a US default would be a catastrophe for the global economy.

    1. Both situations are bad, but the US has the advantage that theirs is the world reserve currency, at least for now. Add to that the fact that most of the world makes a living out of selling to the US and not to the EU, and you can see how that gives the US a bit more breathing room. Fortunately for us south of the border, we now have an administration that at least grasps these concepts and is willing to use political and economic leverage to begin growing the economy fast enough to (hopefully) avoid collapse. Canada and the EU have not got their heads around this idea.

    2. And that is why Trump is pushing the US economy. The U.S. has the potential in its economy while Canada under the Liberals and other leftist morons does not.

      1. The US government deficit for 2024 was $1.8 trillion. Stimulating the economy and adding massive taxes like tariffs will not address that in a serious manner. The solution must primarily come from the spending side.

        Trump has done some work to reduce spending, but it’s Congress that needs to address this in a serious way.

        1. Most of the Federal government spending is on autopilot (SS , Medicare, Medicaid). If you think Congress will tackle those in any serious way, I have a barely used bridge here to sell you. Growth, industry repatriation (tariffs), fully utilizing Federal land, energy royalties, federal labor force reduction, reducing regulations, reining in a rogue judiciary that delays just about anything, etc., are the tools Trump has. That’s our only hope.

          1. Those three make up 44% of the federal budget. Massive, yes, but not everything.

            The president does not have the power to rein in spending in a serious way. That’s not how the US government works. The real power lies with the House of Representatives, where all spending and taxation bills originate.

  7. A “centrist” decrying the welfare state as if the irresistible tendency to vote for spoils of the treasury are not responsible for the ending of all democracies. Alexander Tytler’s thesis stands. This Brit is a typical net-zero mystic. The next step is tyranny and war and the European illuminati (including Caliphate Carney) are going down both those roads.

  8. But, it buys votes, from ALL ages, and ALL diversities of people, born local, and imported.

    To a politician, that’s all that matters.

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