Question: Can you comment on the impact of the enormous fiscal and monetary stimulus, created in response to the pandemic, especially in the United States, where trillions of dollars have been created out of thin air to support the financial system and the economy. Is this likely to cause hyperinflation? Is it bringing us closer to the point where a new monetary system will need to be adopted to replace the existing system?
Answer from the Ascended Master Saint Germain through Kim Michaels. This answer was given at the 2020 Webinar for the Liberation of Women.
Well, my beloved, I will comment in general because what I will say here applies to most nations, not just the United States. Many of the modern democracies, the more developed nations, have for decades been influenced by this particular economic philosophy called neo-liberalism, which basically is not neo, it is simply liberalism. The idea is that the government should restrict itself from interfering with the economy or the financial system, but let the system regulate itself.
Now, as I have said before, the 2008 financial crisis should have proven to anybody that liberalism or neo-liberalism is dead. It has no validity. It has no place in a golden age economy. Since that lesson was not learned, then as I have said before, if you will not learn from one crisis, you will precipitate a worse crisis and here you are.
Here you are in a greater economic crisis than in 2008 and again, you face the same issues. What will the government do? And many governments, including the United States government, are doing basically what they did in 2008. They are creating money out of nothing, which is not in itself a problem, but they are giving it to the financial system because they are still suffering under this illusion that this is the best way, or even the only way to stimulate the economy.
There are many economists, experienced, intelligent economists, who have pointed out, time and time again that when you give money to the financial elite, to the financial system, this will not stimulate the real economy because the banks and the financial institutions will not use it to lend to consumers or businesses. They will use it, first of all, to secure their own position and their own earnings and only about 8-10% of the money created by the government filters down to what you can call the real economy of people who are producing something, who are consuming, who are buying something and therefore, stimulating economic activity and economic growth.
You need to recognize here, I am saying this again into the collective consciousness, that there are two parallel economies running in the world today. There is the financial elite and their economy and then there is the real economy, which is the people who are producing products, providing services and who are consuming products. Now, the financial system, the financial elite, their economy, is as we have said about the fallen consciousness, a parasite on the real economy. It could not exist on its own. It is a parasite that takes advantage of and siphons the wealth out of the real economy. Then, it artificially inflates the value of its stocks, its financial instruments, to a completely unrealistic value that would collapse in a moment if it was not continually supported by the real economy. In other words, the financial elite, their economy has no chance whatsoever of sustaining itself on its own. It can only be a parasite that lives off the real economy.
It is the real economy of people and businesses producing products, giving service and people consuming and buying those products—that is what drives the economy. What needs to be recognized here is that if you want to stimulate the economy, then you do not create money out of nothing and give it to the financial elite, so that only 8-10% filters through to the real economy. You can create money out of nothing, but you give it to the real economy so that you get a direct economic stimulus, where you get almost 100% of the money created going into and stimulating the real economy. If you will not learn this lesson, the system must break down and this will, of course, make it necessary to create a new monetary system.
Now, I have said before, that the world has already created this huge mountain of debt that many nations either cannot pay back or they can only pay it back by enslaving their populations and where does the money go? Do they go to the nation? No, they go to this financial elite and the financial artificially-created economy.
There needs to come a recognition here, that at some point, we need to simply cancel out all debt, reset the economy and create an economy that is not based on creating money as debt, but where the government takes upon itself the responsibility to create what some economists have called sovereign money or sovereign currency, where the government creates the money instead of allowing banks to create the money in terms of loans and where the government then creates that money and gives it directly to the real economy, or at least gives it as loans. This, when it is done right with a computer technology and the knowledge you have today, will not lead to hyperinflation. In fact, it is the debt-based economy that leads to inflation, because inflation is a consequence of the interest that is paid on every dollar that the banks create out of nothing.
The unfortunate aspect of this current situation is that the fallen beings have a convenient excuse, they can say: “It was the COVID-19 pandemic that caused this economic crisis because government shut down normal economic activity. It was not our system that failed.” But I can assure you, my beloved, that had this situation not arisen, the economy would still have failed. The financial system would still have precipitated another crisis and you would have essentially the same dynamic.
Again, you can make the calls for this, if you want, that people and governments will wake up, and they will find a better, more efficient way to stimulate the economy and to create a money system that is not based on debt and that does not allow a small financial elite to be parasites that siphon off the real wealth created through the labor and the ingenuity of the people.
Copyright © 2020 Kim Michaels