Hello, De.Fier!<\/p>\n
This is the transcription of our full-length interview with Professor of Global Economics Daniel Lacalle. 19:20|Daniel Lacalle:<\/strong> 19:42|Michael<\/strong>: I mean the counter argument that gets brought quite a bit (I\u2019m about to hear from you on) is they\u2019ll say well you know there was huge QE and huge money printing in Japan.<\/p>\n Following 1990 obviously their debt to GDP levels way exceeds everything else in the world and yet they haven\u2019t seen inflation.<\/p>\n What kind of view do you have?<\/p>\n 20:07|Daniel Lacalle: <\/strong>Yeah, first everyone, that says that has never lived in Japan. If you ask any Japanese person about this inflation \u2014 they\u2019re very civilized people and they\u2019re very gentle \u2014<\/p>\n But they would hit you. They would hit you. What the hell are you talking about inflation? Have you ever lived in Japan? It\u2019s a joke?<\/p>\n That is the first.<\/p>\n Thing is again I come back to the official calculation. There has never been this inflationary pressure in Japan. However, massive money creation in Japan is regurgitated into government debt.<\/p>\n The JPY is a distant cousin of the dollar because households save a lot, and companies import a lot of US dollars.<\/p>\n In reality what you have is a system in which all the money creation goes to government debt, that government debt goes to pension funds. Real wages, and the value of those savings disappear.<\/p>\n You have inflation because real wages are coming down. Despite the fact that the prices are not rising dramatically. Because inflation is not just prices going up, it\u2019s purchasing power of the currency going down.<\/p>\n When real wages are down almost every year, as we have seen for a decade in Japan \u2014 then you have a huge problem as you do.<\/p>\n Because then what you have is that consumers basically just cannot spend more.<\/p>\n They cannot save it, it\u2019s much more complicated\u2026<\/p>\n 44:06|Daniel Lacalle:<\/strong> Think about this. You may have made a deficit. But tell me one single democrat or republican candidate, that could gone to elections successfully with the monster spending and deficit a program that (in this particular case the democrats but I don\u2019t care for) with the monster deficit program that Biden came or that Trump came.<\/p>\n There\u2019s something happening in civil society. That\u2019s interesting and the thing that is happening in civil society is that they actually are starting to believe, that money is free. But it\u2019s still society because if not even Reagan or Carter, or you name it\u2026 or, Obama, that came with a very strict fiscal program and then did something else none of the.<\/p>\n None of them could win an election saying \u201cI\u2019m going to drive the deficit to trillions\u201d.<\/p>\n 45:17|Michael<\/strong>: yeah you\u2019re saying, yeah..<\/p>\n 45:18|Daniel Lacalle:<\/strong> Now it\u2019s the first time in history in which in an election, I have heard from my friends in the United States \u201cah but money doesn\u2019t matter\u201d.<\/p>\n Well there you go it\u2019s your problem now.<\/p>\n 45:33|Michael<\/strong>: Do you think that this is partially true? When we can compare, (you know like you mentioned Ireland, Luxembourg, Germany \u2014 these are countries that don\u2019t have their own currency) they\u2019re under the EURO and so there\u2019s kind of some removal between them. And basically the faucet of being able to print money. Do you think that makes any difference?<\/p>\n 45:56|Daniel Lacalle: <\/strong>It does actually. It does because you have all those things in civil society that you perceive that something you know.<\/p>\n However, if you hear from people who are allegedly experts, that nothing matters, the deficits don\u2019t matter, that doesn\u2019t matter and that money creation is free.<\/p>\n Hey, you know. A Nobel prize winner told me. Well you know that the Nobel prize winner is not going to suffer the consequences.<\/p>\n But if you think about this in South Korea they went the opposite way of Japan precisely. Because of Japan\u2019s policies. In the Asian countries they went the opposite way of China precisely because of China\u2019s policies, in Chile, in Uruguay, in Colombia, in Costa Rica, in El Salvador \u2014 they went the opposite way of Argentina, Venezuela, Mexico and Brazil. Precisely because of that.<\/p>\n People are not that stupid and what we need – the US citizen is to be blunt, to start being more aware of the risk to the US dollar of what they\u2019re doing.<\/p>\n 47:39|Michael<\/strong>: What you\u2019re saying uh seems to imply to me almost, that you know, there\u2019s that expression you can either be a great example or a horrible warning. They need a horrible warning. This is great. I appreciate you sharing this particular thing about civil society. It is a really interesting insight.<\/p>\n What are your thoughts on digital currencies and everything that\u2019s going on in that respect?<\/p>\n 48:10|Daniel Lacalle:<\/strong> Well, again – digital currencies are in the same situation as bitcoin. BTC is obviously a response to this momentary insanity. But Central Bank digital currencies are another step towards even higher monetary insanity.<\/p>\n Digital currencies \u2014 they continue to be some kind of shelter from monetary insanity. They might become an alternative but right now they\u2019re startup currencies. They\u2019re not yet currencies, they\u2019re not units of measure reserve of value and widely accepted means of payment which is what you need to do.<\/p><\/blockquote>\n That is on its way \u2014 but it\u2019s not yet there. And I think that\u2019s what if central banks don\u2019t learn from the lesson the level of risk that is happening right now digital currencies and BTC, ETH, independent currencies will rise.<\/p>\n Thanks for reading! We\u2019re excited how this interview turned out \u2014 a lot of insights for the entire team:)<\/p>\n Check the full interview by this link \u2192<\/a><\/p>\n How DeFi works? \u2014 Explained by Industry Og\u2019s!<\/a> And join us on twitter <\/a>and telegram!<\/a><\/p>\n Good luck in farming!<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":" Takeaways from the interview with Daniel Lacalle, fund manager Hello, De.Fier! This is the transcription of our full-length interview with Professor of Global Economics Daniel Lacalle. Check the full interview by this link \u2192 Will We See Reduction Precisely Because of the Monetary Effect and Why Japan doesn\u2019t Face Inflation ? 19:20|Daniel Lacalle: Yes, it […]<\/p>\n","protected":false},"author":3,"featured_media":975,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9],"tags":[7],"class_list":["post-974","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-defi","tag-defi"],"acf":[],"yoast_head":"\n
\nCheck the full interview by this link \u2192<\/a><\/p>\nWill We See Reduction Precisely Because of the Monetary Effect and Why Japan doesn\u2019t Face Inflation ?<\/h2>\n
\nYes, it is a monetary effect, and we will see a reduction precisely <\/em>because of monetary effect. As well when there is some taper, but the vast majority of the increase of 2020 and 2001 doesn\u2019t round trip, it makes exactly the same.<\/p>\nNeither Republicans nor Democrats Would Win an Election with a Huge Spending on Deficit Program<\/h2>\n
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People are not economists, they don\u2019t need to be economists.<\/h1>\n<\/blockquote>\n
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