Evidence of the credit boom in northern Chattanooga along Highway153: A retail development still seeking tenants. (Photo David Tulis)
Scott Hale of Dayton, busily talking on the phone, is developer of two neighboring retail complexes in Hixson, one containing an Advance Auto set to open month’s end. (Photo David Tulis)
A steel structural shell rises over space that will house an urgent care medical business, a vitamin shop and a restaurant. (Photo David Tulis)
Evidence of the free money boom is everywhere. In Hixson north of Northgate Mall are new developments. One of them is by Scott Hale of Anchor Commercial Development.
The Dayton, Tenn., entrepreneur is using a loan from First Bank of Dayton, he said, and is overseeing the raising and renting of two structures.
By David Tulis
One of them houses an Advance Auto that will open by the first days of June. It will be filled with four truckloads of shelving and 15 truckloads of merchandise before it is ready for customers, said job superintendent, Lee Smith.
Next door is a much larger building that is more than half rented out already, though it is far from complete.
On the Soddy-Daisy side of the building will be a Firehouse Subs sandwich shop. The next slot is still unrented, but could be divided into two. The next two slots are rented already — one for a vitamin shop and the last for an urgent care business that Mr. Hale declined to name.
On one side of the Hale development is a new Tire Discounter shop in a new building. Looking southward, another new retail building by Issa Development awaiting a second tenant.
The boom here and elsewhere in Chattanooga is the result of an artificial lending boom sparked by low rates of interest.
Kicking depression down road
At the headwater of the great river of credit is the Federal Reserve System, the issuer of the national currency and the top-down comptroller of the economy. It is a private for-profit bank with a U.S. government-appointed board, and has artificially suppressed the rate of interest for a decade to save its elite cronies from having to go bankrupt.
Recessions are depressions that are not allowed to happen. The U.S. economy frequently slumps into recession when it should be hit by a depression. But easy credit and a continuing debasement of the paper dollar avoids pain of widespread liquidation and bankruptcy.
The righting of the ship after an inflationary boom is bankruptcy, closing shop, selling assets at firesale prices and starting over. The benefit of a depression is that the overbuilding, the malinvestment, the underbrush is burned away and the economy stripped bare of falsity and mistake for new building and new investment.
But the masters of the universe at the Fed and in Washington, the “good people” as I call them on talk radio, don’t want that to happen because it creates instability and real losses.
Better their cartel capitalist crony friends keep buying up profitable assets on credit than turn off the spigot of adult beverage and force everyone at the party out into the parking lot and sidewalk.
New credit solves messes old bad credit created, they aver. And so debt builds up, like outdated statutes and programs out of the congress. Dysfunction layered over with dysfunction, misconception built upon the ridiculously optimistic, the fanciful laid like freshly painted tarmac over the purely fraudulent. The buildup in debt has persisted despite crashes such as in 2008.
Respected writers such as David Stockman, Gary North, Franklin Sanders, Charles Hugh Smith and others say the debt buildup has reached its acme worldwide. New issues of credit have almost no further benefit in stimulating new productive activity, and the use of credit anymore by central banks and their national banks produces little return.
The national economy system that brings boom and bust to Chattanooga and to your hometown is possible thanks to clear violations of God’s law and open violations of the federal constitution. God’s law requires honest weights and measures and prohibits fraud and dilution of goods. The U.S. constitution prohibits the states from allowing anything but gold and silver to be accepted in tender of payment of debt.
These structures effectively allow local economies to prosper and prohibit what we see all around us as nationalization of commerce and centralization.
Ban on fiat money
Behind the ban on fiat currency is the prohibition of lawless taking, whether by force or deceit. Inflation and fiat money create many friends, who borrow heavily and repay with debased bills. Inflation builds into an economy and into the hearts of the people a coveting and consumption-oriented nature, and encourages every member of the public to accept not just the violation of the eighth commandment against theft, but the ninth against false witness and the 10th against coveting.
Local economy is protected by God’s law, and its relative poverty is understandable in terms of God’s rule for mankind. Corruption of the medium of exchange violates the ban on diverse weights and measures. For example, “Diverse weights and diverse measures, They are both alike, an abomination to the Lord” (Prov. 20:10), “Diverse weights are an abomination to the Lord, And dishonest scales are not good” Prov. 20:23).
Nonreferential currency that gives the holder no claim on gold or silver is fraudulent, a “diverse weight.” God hates deceptive instruments, whether the scale or the banknote. “You shall not have in your bag differing weights, a heavy and a light. You shall not have in your house differing measures, a large and a small. You shall have a perfect and just weight, a perfect and just measure, that your days may be lengthened in the land which the Lord your God is giving you” (Deut. 25:13-15).
Not only is the rule of property offended by continually debasing the medium of exchange. So is the rule of integrity and honesty. No matter who is on the face of the F$20 bill, the bills follow a design favored by criminal counterfeiters. Private crooks bake currency in private printers and pass it off as officially approved currency. When the Federal Reserve and the U.S. congress altered the words on the face of the bill, it made the language nonreferential. No longer did the words say the bill lets the holder obtain 20 real silver dollars on demand. The words say, instead, that the note can be given in payment of any debt, public or private. That means that a contract for future payment in the paper dollar system today must accept weakened dollar bills of the same kind when time comes to receive repayment.
The borrower robs the lender who used the paper dollar for his contract.
Yet the new nonreferential F$20 bills look like the old bills, which were called silver certificates. The idea of the good people was to make the currency pure fiat without setting off too many alarm bells among members of the public. Make it an inflationary medium of exchange, but deceive the common man at the moment of the conversion — in violation of the 9th commandment, “You shall not bear false witness against your neighbor.”
What lies ahead
The most reliable observers of the American inflation engine say the system is not sustainable, and that the drunken party led by the Fed will, after an uproarious climax such as that in retail construction, tremble and shudder over the toilet seat in the last wrecked stall. The system is unsustainable on many counts, and promises to punish its intimates and let pass those who’ve abstained from its paper promises.
The argument for local economy favors steps consistent with divesting national and investing local. One element of that is getting out of regulated stock markets and mutual funds. It takes time to sell and to determine how to reinvest in local economy. As you meet more people and figure that out, park your buying power in physical precious metals to preserve your buying power. Gold and silver comprise a small market that will be swamped in any meltdown. So have your dealings in that market now.
The main thing is to reduce your dependency on the sclerotic financial and political system that violates God’s law and will meet the judgments of disaster built into its dishonest and thieving agenda. The closer you are to that system, the more you will be hurt when this part or that enters its crisis of confidence.
Does God judge thieves? Are the wicked trapped in their own devices? Do liars find their undoing in their own treachery? Does God confound the wise of this world? Are the great ones truly great and caring for the common man like you and me? Do they deserve destruction, seeing how the money interests have ruined the republic and converted a federation of states served by Washington into a unitary totalitarian national power? Are the slaughter of the unborn by the tens of millions and “gay marriage” not reason enough alone for a general ruin, brought about in the providence of God?
We don’t deserve new developments by Scott Hale and other enterprising people. His Dayton bank and people like him perhaps are confident with near zero interest rates into thinking our overbuilt retail sector needs more outlets. Easy money has made us hugely confident in the future, in the ability of other people to help us pay our debts by their renting and buying from us.
Mr. Hale may be an exception. But the rule is already set: A corrupted medium of exchange, deception at the core of the Fed system, and a provident God whose rules can be violated with impunity, but only for a spell.
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