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ОглавлениеFirst printing: March 2009
Second printing: April 2009
Revised and expanded edition: July 2012
Revised edition fourth printing: May 2020
Copyright © 2009, 2012 by Jerry Robinson. All rights reserved. No part of this book may be used or reproduced in any manner whatsoever without written permission of the publisher, except in the case of brief quotations in articles and reviews. For information write:
New Leaf Press, P.O. Box 726, Green Forest, AR 72638
New Leaf Press is a division of the New Leaf Publishing Group, Inc.
ISBN: 978-0-89221-713-7
ISBN: 978-1-61458-260-1 (digital)
Library of Congress Number: 2009923747
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Unless otherwise noted, Scripture quotations are from the New King James Version of the Bible.
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Others are saying . . .
Jerry Robinson’s conclusions about the state of the American Empire are spot on in Bankruptcy of Our Nation. Not only is Jerry a modern-day Copernicus when it comes to economic issues, but he has the moral fortitude to tell the truth in these challenging times — which you will never get from the mainstream media.
Barry James Dyke
President of Castle Asset Management, LLC of Hampton, NH
Best-selling author, The Pirates of Manhattan I & II
Mr. Robinson has written a good history of the development of modern money systems with valuable specific practical recommendations based on the trajectory of that history. This is understandable history and practical investment advice in one volume. It will provide a valuable guide and positive investment returns to those who follow his well thought out advice.
Bud Conrad, chief economist, Casey Research
Author of Profiting from the World’s Political Crisis
In his book, Bankruptcy of Our Nation, Jerry Robinson does an excellent job of explaining the “Petrodollar” system, which is the 1971 agreement between OPEC and the United States that, in return for military protection by the U.S., Middle Eastern oil-producing countries would accept only U.S. dollars for their oil and invest their profits in U.S. bonds. The present unraveling of this agreement will have a profound impact on the destruction of the U.S. dollar as the world’s reserve currency and that, in turn, will put the U.S. into bankruptcy. This book explains exactly how this will come about, but equally important is the comprehensive section on what you can do to protect yourself.
G. Edward Griffin, author, researcher, and filmmaker
Bankruptcy of Our Nation is a must read for anyone with any money in the stock market. Whether it’s in a brokerage account, 401K, IRA, Roth, wherever it is . . . this is the one book that needs to be on your reading list! As a financial advisor for the past 17 years, I have come to trust Jerry Robinson’s timely advice and mission to educate the public about the hidden dangers in the U.S. and global economies.
Jerry, whom I have the honor and privilege of calling a friend, has put together a survival guide that will help steer you through what I believe will be a very tough road over the next several years. But in these hard times will come tremendous opportunity for those who are aware and ready to seize the moment. This is where Jerry delivers big time in Bankruptcy of Our Nation! He helps readers create an action plan to thrive in the days ahead. He covers ground that the mainstream media won’t touch and when they do it will be far too late. Now is the time to start planning ahead for a tumultuous fallout from the reckless actions of the Fed. Don’t waste another second, do yourself and your family a favor and read this book today.
Jay Peroni, CFP® Chief Investment Officer,
Faith-Based Investor, http://www.faithbasedinvestor.com
Author of The Faith-Based Millionaire and The Faith-Based Investor
A provocative and mind-opening analysis of what went wrong with our economy and a bold strategy for coping with the future.
John Perkins, New York Times best-selling author
Hoodwinked, Confessions of an Economic Hit Man, The Secret
History of the American Empire, Shapeshifting, The World Is As
You Dream It, Psychonavigation, The Stress-Free Habit
Spirit of the Shuar
I just finished reading Jerry Robinson’s excellent book Bankruptcy of Our Nation. Not only does he get the entire picture, he makes it all easy to understand!
Charles Goyette, New York Times best-selling author of
Red and Blue and Broke All Over and The Dollar Meltdown
Jerry Robinson puts forth a thorough yet digestible study on the economically unsustainable financial system Americans have been bound to and some sound methods and practices the individual can take to break the chains and truly be individual.
Gerald Celente
http://trendsresearch.com
Contents
1. What Is Money . . . Really?
2. A Short History of Fiat Currencies
3. The Rise and Fall of the Golden Permission Slip
4. The Petrodollar System: Same Game with a New Name
5. Petrodollar Wars: Protecting Dollar Demand through the Barrel of a Gun
6. The History of the Federal Reserve (or How America Lost the Revolutionary War)
7. Modern Money Mechanics: What the Banksters Do Not Want You to Know
8. America: The Greatest Debtor Nation in World History
10. The Coming American Hyperinflation and Dollar Collapse
11. Maxed Out: The New American Slavery
12. Breaking Free from the Consumption Trap
Strategies — Financial Wisdom for Uncertain Times
13. An Introduction to the P.A.C.E. Investing Philosophy
14. 21 Income Streams You Can Create Now...and in Retirement
15. Eight Key Strategies to Protect Your Finances
Appendix A — The DSL Savings: A Strategy to Combat Inflation
Appendix B — The Five Levels of Financial Freedom
Appendix C — Frequently Asked Questions from Our Readers
Glossary
Acknowledgments
To my sweet Jennifer Dyan, the love of my life and my business partner. I cannot imagine life without you.
Also, special thanks to Brenda and Cris for their many hours of proofreading and editing. Finally, a big thank you to our growing online community at FTMDaily.com. I thank each of you for your loyal readership and your continued support.
Introduction
According to the laws of physics, an apple thrown upward into the air will be pulled downward by the invisible force of gravity. And while history does not necessarily subscribe to a set of predictable laws, it can teach us great lessons. These lessons can even be forceful at times. It has been said that while history may never truly repeat, it does at least rhyme. And unfortunately, in the case of the inevitable American economic decline, we have a wide array of historical precedents, which we will examine throughout this book.
The Excesses of Empire
The painful truth expressed in these pages is that the end of the American experiment will, more than likely, come sooner rather than later. America’s ascendance into the heady realms of economic empire began in the post-World War II Bretton Woods era when it was the world’s greatest creditor nation. Today, around 70 years later, America stands as the greatest debtor nation in world history. Decades of financial excess, coupled with an entitlement mentality, have left America financially bankrupt.
America clearly represents a reluctant economic empire in decline. And like all empires that have gone before it, its days are numbered. The death of an empire can be quick and painless; however, that is rarely the case. Instead, empires tend to die slow, painful, and humiliating deaths, and their demise is usually accompanied by at least two themes: an overextension of the empire’s military and extreme economic overindulgence and depravity. America exhibits excesses in both of these categories.
Over the last few decades, several economic trends have pointed toward an eventual day of reckoning for the U.S. economy.
The Selling of America: Our nation’s overconsumption, coupled with U.S. military adventurism since the Vietnam War era, has been largely financed by foreign creditors. With massive trade deficits and an exploding national debt, America is now in a highly vulnerable position as we move into an uncertain future. America’s shameful lack of sound fiscal stewardship has created the largest national debt in human history: a colossal $23 trillion . . . and it is growing by the billions every single day with interest. Foreign countries own more pieces of America than ever before. Not only do foreigners own a large amount of America’s real wealth (real estate, corporations, etc.), they also hold vast amounts of our government bonds. The repercussions of this large foreign ownership of American interests will be discussed in upcoming chapters.
Low Personal Savings Rate: Since the 1930s, the savings rate for the average American household has stood at around 10 percent. (From 1943 to 1945, the average savings rate was well over 25 percent.) However, as our nation began consuming more than it produced, the personal savings rate dropped dramatically — even turning negative in 2005 for the first time in our history.1 More recently, and in the wake of the 2008 credit crisis, consumers have boosted their savings with the average rate now at about 5 percent, still well below the saving rate of previous generations.2
An Overreliance Upon Credit: U.S. consumer debt has reached all-time highs. This year, more Americans will declare bankruptcy than will divorce, graduate from college, or get cancer; 43 percent of American households spend more than they earn every month. Clearly, this lack of fiscal discipline must eventually end. Today, the U.S. credit industry has trumped the manufacturing industry in total revenues. This as the consumer-crazed nation purchases everything in sight through the use of high-interest credit in an effort to feed the hungry credit beast that they have created.
The Outsourcing of American Jobs: Over the last several years the United States has outsourced the majority of its domestic manufacturing to foreign countries, like China and India. Americans have opted instead to specialize in consumption.
The Breakdown of Social Security and Medicare: The federal government’s utter mismanagement of the money that has been entrusted to them through the Social Security and Medicare programs is an absolute disaster. Millions of hard-working Americans are rightly concerned that the money that they were promised by their government will not be there when they reach their golden years. In the upcoming chapters, I will confront this topic and even provide you with unique strategies for preparing for the potential breakdown of these government programs.
A Systematic Destruction of the U.S. Dollar: U.S. “prosperity” is denominated in a debt-based and debt-backed currency, the U.S. dollar. But this illusion of prosperity in America is hardly recognized or highlighted by the financial elite or the nation’s media. Since 1913, the Federal Reserve’s excessive printing of the nation’s currency has led to a 95 percent decrease in the dollar’s value. Thanks to the Federal Reserve’s noxious mix of quantitative easing programs (money-printing) and extended periods of artificially low interest rates, the financial markets have been completely distorted. These negative monetary policies have systematically devalued the U.S. dollar. In the upcoming chapters, I will provide creative financial solutions for preparing your family and finances for the inevitable hyperinflation that will arise from the Fed’s destructive monetary policies.
No Accountability Over the Federal Reserve Bank: Since it was established as America’s central bank in 1913, the Federal Reserve has operated without any meaningful congressional oversight. At the height of the 2008 economic crisis, the Fed has admitted that 90 percent of its emergency loans were issued to foreign banks. As long as the Fed is allowed to conduct its operations in secret, America’s economy will remain hostage to the elite foreign banking interests.
The Abolishment of the Gold Standard: In 1933, the U.S. dollar lost its national gold backing. And later, in 1971, President Richard M. Nixon closed the international gold window. Put simply, in 1971, the United States led the entire global economy into a 100 percent paper money environment for the first time in world history. Today, thanks to our nation’s paper currency system, it now takes one dollar to purchase what five cents could purchase in 1945.
America’s Debt-Based Monetary System: After the gold standard was abolished, America’s monetary system moved from being “gold-backed” to “debt-based.” This book will explain America’s current debt-based system in stark detail. You will learn how money itself is nothing more than debt. To understand this concept, we will examine the Federal Reserve System and the mind-blowing money creation process they employ.
U.S. Military Overextension: America’s military-industrial complex has been growing uncontrollably since the day that President Eisenhower warned U.S. citizens of its lust for power. Our country’s nation-building efforts have drained troop morale and drastically increased our debts. Presently, America has over 700 military bases in more than 120 nations — over half of the world’s nations! The American obsession with maintaining global hegemonic power through military force is justified in the name of protecting the important causes of freedom, democracy, and justice worldwide. Or as former President William McKinley put it, “The American flag has not been planted in foreign soil to acquire more territory but for humanity’s sake.”3 However, acting as the ever-vigilant and omnipresent global policeman requires an annual budget of over $550 billion.4
• That is five times larger than China’s $92 billion annual military budget5
• Nine times larger than Russia’s $63 billion6
• And 55 times larger than Iran’s $11 billion7
In fact, funding the American military machine costs almost as much as the rest of the world’s military expenses — combined. And while these exorbitant costs spent to maintain militaristic dominance are typical of an empire, they are clearly unsustainable.
Wars Conducted without Constitutional Authority: The U.S. Constitution requires a declaration of war to be made by Congress prior to a military action. However, the last war that was officially declared by Congress was World War II. This dereliction of duty by our national leaders is shameful and it demonstrates the clear disregard that both political parties have for our nation’s own guiding principles and ideals.
Wars Conducted Without an Appeal to National Sacrifice: America’s modern wars are fought without an appeal to national sacrifice. Instead, massive capital inflows from foreign creditors help fund America’s military machine. Put simply, America could not afford its current lifestyle of overconsumption and conquest without the kindness (and money) of strangers.
America’s Borders Are Not Secure: As U.S. taxpayers are forced to spend hundreds of billions of dollars to protect national borders halfway around the world, our own borders remain porous and insecure. Our national priorities are clearly backward.
Excessive Foreign Aid Dollars Extracted from America’s Middle Class: Every year, Washington takes money from the working poor and middle class in order to give it away to leaders of corrupt countries in the form of foreign aid. This practice enriches the ruling class at the expense of average working Americans.
The Coming Breakdown of the Petrodollar System: In this book, you will come face to face with the system that will lead to the collapse of the U.S. dollar. It is known as the petrodollar system. The shocking details of how this system works will be revealed in an upcoming chapter.
Dependence upon Foreign Oil Supplies: U.S. and global demand for energy resources are increasing at a rapid rate. Unfortunately, projected global energy production will not be able to keep pace with global demand. A growing depletion of cheap energy resources, coupled with a threatened petrodollar system, will more than likely force America into becoming militarily aggressive in future resource wars with other growing nations (i.e., China, India, etc.).
Lack of a Sound Energy Policy: No country can maintain its position in the global economy without developing a sustainable strategy for meeting its own energy needs. Sadly, instead of allowing the free markets to dictate our energy supplies, the federal government has intervened with massive subsidies, taxes, and burdensome regulations that create distortions in the market price of energy. Federal drilling restrictions serve as roadblocks to domestic energy exploration. Unless true leadership can emerge to give our nation a sound energy policy, we face increasing danger to our economy in the months and years ahead.
As the hard facts above demonstrate, the American economy represents nothing more than a feeble house of cards completely vulnerable to the inevitable external forces that await every declining empire.
The Life Cycle of Democracies
Consider how the Scottish historian Alexander Tyler documented the typical life cycle of a democracy:
A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves money from the public treasure. From that moment on the majority always votes for the candidates promising the most money from the public treasury, with the result that a democracy always collapses over loose fiscal policy followed by a dictatorship.
Tyler continues with this amazing statement:
The average age of the world’s great civilizations has been two hundred years. These nations have progressed through the following sequence: from bondage to spiritual faith, from spiritual faith to great courage, from courage to liberty, from liberty to abundance, from abundance to selfishness, from selfishness to complacency, from complacency to apathy, from apathy to dependency, from dependency back to bondage.8
Does this sequence sound familiar? In which stage of the life cycle do you believe America is currently?
In summary:
• The purchasing power of our U.S. dollar is declining in value.
• The U.S. government continues to print more money.
• We are engaged in an expensive and endless global war on terror.
• American jobs are being exported to foreign nations.
• Americans are spending too much and saving too little.
• We have requested little, if any, economic “sacrifice” on the part of our citizenry.
• Our trade deficit and budgetary deficits are at all-time highs.
• Our national debt is at an all-time high and growing exponentially.
• We are completely dependent upon foreign nations to fund our overconsumption through the sale of our debts.
As long as foreign countries continue to finance our way of life, perhaps we can extend this madness. But what happens if foreign countries begin to decrease their funding of our debts?
The truth is, the American public is living in massive monetary deception. The direction that the American economy is heading is extremely difficult to swallow. However, if our aim is truth, then we will willingly embrace the facts and take the necessary steps needed to shelter ourselves, our families, and our finances. While it may be hard to believe right now, the message of this book is one of great hope. Our hope is in knowing which direction the trends are taking us. It is in this knowledge that you will be able to protect and shelter whatever wealth you have already accumulated, and in addition profit from the greatest financial crisis that the world has ever witnessed. As you read the following chapters of this book, be of good cheer. Despite man’s best efforts, God is still in control. And with God, the end is only the beginning.
Warning: Spiritual Discernment Used in this Book
In the interest of full disclosure, I should tell you up front that I am a follower of Christ. However, allow me to quickly add that I have not reached the ranks of the “spiritually arrogant.” I view my faith as the most humbling aspect of my existence. And I can think of nothing that turns me off more than spiritual smugness and self-righteousness. The world would be a better place without the crusaders who become obsessed about the speck of dust in someone else’s eye while ignoring the enormous log in their own eye. So, expect no fiery pronouncements to be issued from my pen. I have made my share of mistakes and do not view my role to be as a judge of others and their shortcomings. The reason for my upfront candidness on this matter is because I believe that you, as the reader, have a right to know that your author’s worldview has been colored by his faith.
As a believer and follower of Jesus Christ, it is my earnest belief that hope is never completely lost, because God’s sovereign plan of the ages will forever prevail — no matter how desperate things may appear on the surface. But if my brief time on this earth, and my understanding of history, have taught me anything, it is that only fools place their trust in man’s ability to rule himself. In fact, if history is a guide to anything, it is a guide to the consistent knuckleheaded acts of mankind throughout the ages. From a spiritual perspective, I believe that mankind’s current predicament stems from the fact that man was not designed nor was he ever meant to rule himself. According to an orthodox view of the Christian faith, human suffering is rooted in man’s rejection of the omnipotent rule of his Creator. When given a choice, man opted for self-rule. This ancient act of rebellion, in the Garden of Eden, explains humanity’s pain and suffering over the last 6,000 years. And if we choose to believe the Bible when it explains that mankind’s rebellion will become worse with time, it would also explain why the 20th century has been noted as the “bloodiest century” on record.9 (Ironically, the 20th century has also been labeled the “American Century.”)
In many ways, America represents the culmination of all that man has ever aspired to: life, liberty, and the pursuit of happiness. And yet despite the amazing personal freedoms, rights, and liberties that the “American experiment” graced upon the Western hemisphere, man’s inability to lead himself has continually bubbled to the surface. Unable to personally rid himself of his true sin nature, man has attempted in vain to cloak his inherent deficiencies at self-rule. As a result, America is following the same path as every economic empire before it. And lest we confuse ourselves, American Christians must quickly grasp this point: America is not the light of the world. The sun shone before America was here, and it will continue to shine long after our nation’s self-inflicted demise. So let us not proceed in shock or surprise at the complex political and economic webs that have been woven in America. Despite what the Western-centric thinker may suggest, the ancient writings of the Bible are clear. They confirm that the biblical prophecies concerning the “last days” are Israel-centric and Middle Eastern-centric. They are anything but America-centric. In other words, I believe that the Bible clearly suggests that the global political and economic spotlight will be firmly transferred to this volatile region in the coming years.10
Put simply, America’s fall is historically identifiable, though unfortunate. And it is all but certain.
Endnotes
1. Laura Smitherman, “Personal Savings Rate Dips to Zero for First Time Since Great Depression,” The Baltimore Sun, January 31, 2006.
2. For the most up-to-date personal U.S. savings rate, see the report on Personal Income and Outlays from the Bureau of Economic Analysis, http://www.bea.gov/national/index.htm#personal.
3. From a 1900 campaign poster for the Republican party, July 12, 1900.
4. Paul Eckert, “Analysis: Pinched U.S. Seen Holding onto Big Pacific Presence,” Reuters, http://www.reuters.com/article/2011/08/12/us-usa-defense-asia-idUSTRE77B0K020110812, August 12, 2011.
5. Ibid.
6. Ibid.
7. “Russia confirms 2011 defense spending hike,” UPI, http://www.upi.com/Business_News/Security-Industry/2010/11/10/Russia-confirms-2011-defense-spending-hike/UPI-91241289393180/, November 10, 2010.
8. David L. Wood, Why Worry About the Gradual Loss of Our Liberties? (Oakland, OR: Elderberry Press, 2003), p. 36.
9. Numerous biblical references point to the increase of wickedness as mankind nears what the Apostle Paul called “the last days” (2 Timothy 3:1–5). See also Matthew 24:12. For documentation on the 20th century being termed the “bloodiest century,” see Niall Ferguson’s book, The War of the World: Twentieth-Century Conflict and the Descent of the West (New York: Penguin Press, 2006).
10. The writings of the biblical prophets Daniel, Ezekiel, Zechariah, and the Apostle John, envision a time when the Middle East, and Israel, in particular, play the dominant role in the fulfillment of biblical prophecy. See Daniel 2 and 7, Ezekiel 38 and 39, Zechariah 12, and the Book of Revelation. See also the Olivet discourse, which provides an overview of the “last days” as delivered by Jesus Christ himself in Matthew 24, Mark 13, and Luke 21.
