"In Madoff We Trust"

Peter Schiff's Economic Commentary from Wednesday, December 17, takes aim at the giant Ponzi scheme that is Social Security and our nation's monetary policy.

As the multi-billion dollar Ponzi scheme orchestrated by Wall Street insider Bernard Madoff unravels in the media spotlight, the nation is being presented with a rare opportunity to understand the true nature of many of our most cherished financial structures. Hopefully we have the wisdom to connect the dots....

The United States Government runs its own balance sheet based on the Ponzi principal as well. Our national debt always grows and never shrinks. As existing debt matures, proceeds are repaid by issuing new debt. Interest payments on existing debt are also made by selling new debt to investors. The whole scheme depends on an ever growing supply of new lenders, or the willingness of existing lenders, to continue to roll over maturing notes. Of course, as was the case with Madoff, if enough of our creditors want their money back, the music stops playing....

The main difference is that while Madoff took elaborate steps to conceal his scheme, the U.S. government operates in broad daylight....

Read the rest here.

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