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Do you think the economy is just in a "down" cycle and will turn around soon?

Robert Wiedemer

Aftershock Book

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Video Transcript

One thing we try to teach in "Aftershock", one thing we try to discuss, is the concept of an evolving economy. People think that we're going through business cycles, so at least they talk about it, but ask yourself, is the economy of the 1890's really like the economy of the 1990's, the economy like the 1950's like the 1850's, or the 1920's like the 70's?

The economies are changing fundamentally. A great example, thirty years ago was China very important in our economy? Today, it is. So there's no cycle there. Our economy is evolving and it's changing and that's part of the reason gold has evolved to the point where it's a really good investment right now. It may not have been earlier; it is now.

We're not really cycling; we're evolving. Each of those decades had certain driving forces behind it that moved our economy forward. That's a key concept to understanding what's going on. We don't naturally cycle back. Again, the economy of the 80's is not like the economy of the 40's. Everything had their individual drivers. We have a set of individual drivers now that are very different from what we had before. Like when we're in the depression, did the government have a 15 trillion dollar debt entering the depression? No, it was pretty much rock solid compared to today. That's a major difference between today and then. So these are the kinds of things we try to express in "Aftershock, we try to discuss in "Aftershock" to give people an idea of how the economy is evolving instead of cycling in and out on an endless wave line. It doesn't really make sense. We sort of know in our gut that's not the way it is.

Related quote from his book:

"...the US economy is in the middle of a long term fundamental change, it is evolving, not merely cycling back and forth between expansion and contraction. Therefore, the multi-bubble economy will not automatically turn around and go back up again in the next few years." (AFTERSHOCK, page 13)