someone with a positive analysis on the political economy, outside the relentless spin cycle, is Fitts 3.0 paradigm (albeit with a couple of startling beliefs - energy independence by 2035? Is she seriously drinking the BP Kool-aid . . .)


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After the interview: Catherine Austin Fitts says part of her brand is to be “positive.” She underscored the importance of seeing both the negative and positive aspects of the economy. She thinks this is really the only way people can navigate the dramatic changes coming.



Excerpts:

Investment advisor Catherine Austin Fitts knows the economy is bad, but not all bad. She says, “There are many aspects of the economy where the fundamentals are dreadful, and there are certainly parts of the economy collapsing in an evolving implosion.” Fitts contends capital has shifted out of the old system and into a new system that is high tech and rapidly evolving. Fitts explains, “One of the things that is keeping the slow burn going is that money flowing into the new system is being reinvested, and those parts of the economy are not only growing but growing strongly. . . . . You need to see the fact that we have a global 2.0, which is essentially bankrupt; and we have a global 3.0, which is rich with resources and growing dramatically. . . . The reinvestment in global 3.0 is now accelerating at rapid speeds, and I think it is going surprise everybody of how dramatic the changes are going to be.” Fitts saysyou can sum up what to do with a line from last year’s Brad Pitt movie about zombies. Fitts says, “Movement is life. It is unbelievable in importance that we all be prepared to shift. When you have this very deep and dramatic shift in technology and investment flows that ripple through all aspects of our lives. . . . So, the guys that are going to be the winners are the guys that can get the high learning speeds.”

What is one of the biggest changes coming? Fitts says, “In September of 2011, there were approximately 800 million people on smart phones or tablets or desktops around the world. . . . Since September 2011, another half a billion people have gotten onto smart phones and tablets. . . .That’s astonishing because we have 1.2 billion people on smart phones and tablets who are one market in theory. That’s new. Never in the history of the world have we had 1.2 billion people who shared membership in one consumer market.”

On Bitcoin, Fitts says, “I am not a fan of virtual currency, even though I think virtual currency is here to stay. I always say it’s the hardware that controls. So, whoever controls the cable, whoever controls the pipe can intercede and can come in and grab the server. Sovereign governments have physical control, and the most sophisticated intelligence agencies are going to have the ability to hack on in. The notion that this stuff is anonymous, you’re dreaming.”

On gold in 2014, Fitts predicts, “I think gold is in a primary trend up, but I think that primary trend has to be reproved. I doubt it will be reproved in 2014. It will probably take longer. I think there is tremendous pressure to keep the gold price down so the big central banks and big financial institutions can cover their shorts. In the long run, you have enormous global demand from the emerging markets.”

Some of the big risks to the global economy include China and its slowing growth story. Fitts warns, “If you think we have a problem keeping people employed with automation, China has got a much bigger problem.”

On all the money printing and market intervention, Fitts says, “When you have central banks and sovereign governments intervening in these extraordinary ways in the financial markets, what happens is the possibilities of scenarios get wider and wider. It’s like the economy stretched on a bungee rope. If it snaps, you can get very extreme scenarios.”

One extreme scenario includes war. Fitts says, “The most significant risk to the global economy is the risk of war. Fitts goes on to say, “There is enormous global incentive to avoid war.”

Rising interest rates are another possible problem in 2014. Fitts, who was a former Wall Street investment banker, says,

“I think there is going to be tremendous pressure to keep those rises managed. Now, let me underscore something. We have never ever in the history of civilization managed rising rates when we have had a huge book of interest rate swap derivatives. . . . If interest rates start to move up quickly, we have no idea what could happen to that interest rate book. . . . It’s literally like a nuclear bomb that could go off. . . . If they can’t prevent the rapid rise, I think we will have war because that is the only way you can force the intercession you need to keep a lid on things.”
Join Greg Hunter as he goes One-on-One with Catherine Austin Fitts from Solari.com.