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484 of 504 people found the following review helpful
5.0 out of 5 stars Offers many fresh perspectives while covering familiar ground en route to commonly stated conclusions
The introduction suggests that this book is going to rehash some fairly common themes. Then, delightfully, the first chapters veers off on an unexpected tangent, followed by an equally astute, and unexpected second chapter.

The introduction suggests that we are in for a time of either inflation or deflation, and that they are both equally dangerous. The thesis...
Published 8 months ago by Graham H. Seibert

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202 of 230 people found the following review helpful
2.0 out of 5 stars A CIA-Centric Analysis
In interviews Jim Rickards frequently refers to his war games work with the CIA. He sure sounds like an insider and that's good right? It can be if your team has a good track record. So, who's on the team?

In the Death of Money Jim Rickards calls the fictional 911 Commission Report a "monumental and excellent summary". He scoffs at the suggestion of US...
Published 8 months ago by Tom G


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484 of 504 people found the following review helpful
5.0 out of 5 stars Offers many fresh perspectives while covering familiar ground en route to commonly stated conclusions, April 4, 2014
Verified Purchase(What's this?)
The introduction suggests that this book is going to rehash some fairly common themes. Then, delightfully, the first chapters veers off on an unexpected tangent, followed by an equally astute, and unexpected second chapter.

The introduction suggests that we are in for a time of either inflation or deflation, and that they are both equally dangerous. The thesis he repeats throughout the book is that central banks favor inflation for a number of reasons, but that they are having a hard time forcing inflation it to occur. There is simply too much slack in the economy in the form of unused labor, capital, and production capacity. Other authors argue that increases in productivity are inherently deflationary: if automation reduces the cost of manufacturing a car, competitive pressures will force manufacturers to sell them cheaper.

The federal government must have inflation for four reasons. Deflation causes an increase in the real value of the federal debt. It has an adverse impact on the debt to GDP ratio. Third, although banks may benefit initially by being repaid more than they lent, the risk of default increases dramatically in a deflationary environment. The fourth and final problem with deflation is that it reduces federal tax income. As nominal earnings decrease, the tax rate schedules, which are graduated, yield less revenue in real terms. Though asset value may rise in real terms, you cannot tax capital gains unless the nominal value rises.

Central banks throughout the world are fighting the tide as they work to promote inflation. The result of Quantitative Easing has been massive malinvestment by those to whom the newly coined money has been funneled.

Chapter One covers the financial signals that telegraphed the World Trade Center attack, had anybody been astute enough to parse the evidence. Rickards consulted with the CIA during the decade of the 2000s, looking for ways in which markets predicted attacks on American interests. In analyzing how the terrorists benefitted financially from their own act, he offers a broad discussion of financial forensics. He matter-of-factly documents overwhelming evidence of insider trading and market manipulation. These are not central to his theme, except insofar as obviously rigged markets make investors wary.

Chapter Two discusses financial warfare. The key insight is that state actors are often more interested in relative than absolute strength. Every war has costs, but if country A can destroy country B at an acceptable cost to itself, it may do so. Destroying the dollar would have a major impact on dollar holders such as China, but at the same time increase their relative strength in the world. His analysis of the way the US used finance to cripple Iran and Syria is quite insightful. As Russia and China free themselves from reliance on the dollar, they might do the same to us.

Chapter Three analyzes the increased involvement of central banks in the economies of their countries, and the general ill effects of central planning. It didn't work for the communists, and it doesn't work for Yellen. The Fed gets tangled up when it targets inflation and unemployment statistics, when its own actions influence those statistics, and the Federal Government has ample room to fudge the measurement of the statistics. Any policy can be justified.

Of the four causes of economic depression, Rickards claims that the greatest is regime uncertainty. People refuse to invest when the rules keep changing. Amity Shlaes and others have concluded that Roosevelt prolonged the Depression by constantly changing the rules for labor unions and other politically favored groups. And Obama is doing the same, with the same result. Entrepreneurs are reluctant to invest, leaving a lot of capital and labor idle.

Fed policy of low interest rates is forcing people to take unusual risks in pursuit of a return. Neither common people nor money managers find it easy to sit tight and accept a zero return on capital for any period of time. Instead, they have been stampeded into the only games in town - overinflated real estate (again) and a rigged stock market. Interest rates, and especially the price of gold, have been forced down in order to push money into these bubbles.

Chapter Four focuses on China, beginning with a sweeping historical overview of the world's longest lived civilization. He observes that it swings rather regularly back and forth between centralization and decentralization, each in turn cleaning out the excesses of the other. This is a time of great malinvestment. Whereas consumers account for 71% of US spending, the figure for China is only 35%. For investment, it is 13% vs. 48%. The latter is an absurd figure, including vast amounts of malinvestment: empty cities, trains to nowhere, and the like. As in the US, the middle class is the victim. As their savings receive negative rates of return, vast amounts of money go into mutual-fund type vehicles which in turn invest in the bubble. It will not end well.

Though China, with $3 trillion in assets, could put its financial house in order, it will not. The powers that be make their money from the malinvestment. The growing wealth disparity represents a major threat to the regime.

Chapter Five is on Germany and the Euro Zone. It is refreshingly different from the mostly negative analyses most authors offer. He gives good reasons why the Euro should survive as a currency and cites optimistic statistics about the progress that the PIIGS, especially Greece, have made in cleaning up their economies. In particular he notes that contrary to the Keynes/Krugman theory of "sticky wages," wage rates have been able to fall by a whopping 22% even without abandoning the Euro. Moreover, Greece is attracting new investment.

The Euro zone is continuing to expand, with the recent admission of Latvia and Croatia, and the potential membership of Serbia, Macedonia and Turkey.

On the other hand, the Euro zone does suffer from a lack of uniformity in banking standards and deposit insurance. A bigger problem is that few of the member states meet the requirements for keeping their finances in order. They are to run deficits of no more than 3% if their Debt/GDP ratio is less than 60 (very few of them) and no more than ˝ percent if debt is higher.

Chapter Six begins with a discussion of the BRICS, then goes on to the GIIPS (nice acronym for the PIIGS) and BELLS. The latter - Bulgaria, Estonia, Latvia and Lithuania - was new to me. His major point is that the BELLS swallowed their medicine after the crisis of 2008, accepting a plunge in the GDP and austerity, refusing to devalue, in order to retain investor confidence. The PIIGS did what the US has done - print money, in some cases devalue, and pretend the problem will go away. The BELLS have fared quite well - the PIIGS not so well.

He has a wonderful quote on Russia: "The Russian economy is best understood as a natural-resource-extraction racket run by oligarchs and politicians who skim enormous amounts off the top and reinvest just enough to keep the game going." That has been the game here in Ukraine as well, and the Maidan revolutions of 2004 and 2013 are attempts to wrench the country free of the oligarchs.

Chapter 7 - Debt, deficits and the dollar

What is the meaning of money? The classical definition is (1) a store of value, (2) a medium of exchange, and (3) a unit of account. These meanings are important, and Rickards has a great dissertation on the various points of view. This is a matter of practical import. Is gold money? Is Bitcoin money?

He offers an interesting view. We are already on the gold standard, in that anybody who wants to is free to buy gold and use it as a store of wealth. It is not in governments' interest that we do so, which is why they echo Keynes, calling it a "barbarous relic" and openly manipulate its price to make it unattractive. One reads so much about the manipulation that it is worth citing other sources. It is a major theme on zerohedge. Paul Craig Roberts did a good piece in January. The Gold Antitrust Committee covers it regularly, and I review Geheime Goldpolitik: Warum die Zentralbanken den Goldpreis steuern (German Edition).

Rickards says that government investment is justified if it satisfies three conditions: (1) only government could do it, (2) they can afford it, and (3) it has a positive return on investment. Two positive investments were the Interstate Highway System and the Internet. Most government investments, including just about everything Obama has done, do not qualify. They channel money the government cannot afford (has to print) to favored groups for investments (solar, education) which will never pay for themselves.

Chapter 8 is on the IMF, the banker to the world. At present the IMF's balance sheet is only about 600 billion, small compared to those of the central banks. His point is that the IMF is the ultimate backup when central banks fail. The IMF has recently, quietly gotten permission to act like a bank, lending in excess of the asset base formed by member-state quotas. The currently allowed ratio is a conservative (for banks) 3:1. But - the mechanism is in place to print vast amounts, if and when the world's central banks get in trouble.

The most interesting part of the chapter is a portrait of Dr. Min Zhu, the Chinese deputy to Christine Lagarde. He is a man who has seen both the Chinese and the Western systems, is smart enough to see the inherent contradictions within the IMF, and sometimes sufficiently candid to coyly reveal what he knows. A nice portrait. NB: Other illumination portraits in previous chapters include Andy Marshall of the Pentagon and Randy Tauss of the CIA. Rickards knows them not merely as a writer, but from having worked intimately with them.

One of the truths that is widely known in financial circles, but seldom admitted, is that today's economic problems are primarily structural rather than cyclical. Don't blame it on the business cycle. The changes in demography, technology and society are structural and will not reverse themselves. Neither Japan nor China will sprout a generation of new workers overnight. In the US, the number of people entitled to entitlements will not shrink; neither will the cost of "free" medicine.

His thesis is that the SDR, the IMF "currency" formed of a market basket of national currencies, could become a world currency. Moreover, it could, if his suggestions were followed, be pegged to gold as a deterrent to uncontrollable fiat currencies.

Chapter 9 - Gold

This is the meat of the matter. Gold is money. The purest money. It is not a commodity, despite where it may be traded, because unlike commodities it is rarely consumed, but used almost exclusively as a store of value.

Rickards writes openly and authoritatively about the ways in which central banks and government manipulate the price of gold.

Chapter 10 - Crossroads

Rickards writes as a throwaway that our governments are manipulating all the markets. It is so widely accepted as not to require amplification.

There is massive malinvestment, from Chinese ghost cities to US student loans. While the problems could be fixed, the structure of our political systems will almost certainly not allow it. The vested interests are too strong.

Chapter 11 - Maelstrom

Rickards has referred to complexity theory often throughout the book. Here he amplifies the discussion. Systems, especially those involving human beings, are simply too complex to be predicted. One never knows, by analogy, which snowflake will trigger the avalanche. All you can know is that an avalanche is likely.

He says that the crunch time is here for the Federal Reserve. There is a term used in complexity theory: a system about to fail goes wobbly, much as the top stars to wobble when it runs out of centrifugal force. He says that the Federal Reserve is already there, and it is unable to fill any of its roles other than to continue to monetize debt.

Conclusion

This is the pay dirt. Rather like a Biblical prophet, he lists seven signs of the end times. And most useful, he gives his assessment of how to brace for the storm. He would own gold, land, hedge funds invested in hard assets, fine art and cash.

Rickards cites a relative handful of sources repeatedly: Krugman, Reinhart and Rogoff, Bernanke, and Robert Rubin's acolytes. While he has an occasional good word for each of them, he is properly scathing when appropriate.

Rickards is more willing to accept official statistics on unemployment, inflation and the like than others. He does not express skepticism as to whether or not the gold is still in Fort Knox. The skeptics are well known - look at zerohedge - and I find it impressive that he can build such a strong case for the imminent "death of money" even taking government claims and statistics at face value.

The book could have been endlessly large. Subjects which Rickards chooses not to address are the declining quality of our human resources - poor education, and the skew of childbearing to the least capable members of society, the inexorable rise in entitlement spending, and the decline of the work ethic. See Coming Apart: The State of White America, 1960-2010 for this discussion.

All in all, a masterful job by a man who has lived with his subject for most of a lifetime, and yet writes with the clarity of a lifelong author. A rare treat.
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96 of 99 people found the following review helpful
4.0 out of 5 stars Plenty to chew on, April 11, 2014
This review is from: The Death of Money: The Coming Collapse of the International Monetary System (Hardcover)
I very much enjoyed Rickards' first book, "Currency Wars." This was a very good sequel, although in my opinion it doesn't rise to the same level.

The premise of the book is fairly straight forward: The current monetary system is unsustainable and it's bound to collapse. It all can be boiled down to a few reasons: debt, structural problems in the world economy, derivatives, and out-of-control increases in the money supply.

According to Rickards, it's only a question of time. Monetary collapse can sound quite alarmist to some. (The over-the-top title, probably selected by the editor, doesn't help). However, Rickards points out, rightfully so, that it is not as uncommon as people tend to think. In the past century alone, the international monetary system changed three times; the first after WWI, the second after WWII (Bretton Woods agreement), the third was in 1971 after Nixon closed the gold window.

Even though I tend think that a change, at least to some degree, of the monetary system is definitely in the cards, I was not fully convinced by Rickards' arguments. As well, I found the first few chapters on the financial wars entirely unrelated to the premise of the book. Having said that, some chapters were original and intriguing, such as the chapters on the IMF, which will take the lead rule in the new monetary system to come.

I suspect that a lot of readers will not agree with everything Rickards has to say, but I also suspect that a lot of readers will learn something new by reading this thought-provoking book.
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95 of 103 people found the following review helpful
5.0 out of 5 stars One of the authors which marked the economics scene in the last 5 years, April 10, 2014
This review is from: The Death of Money: The Coming Collapse of the International Monetary System (Hardcover)
‘The Death of Money’ written by James Rickards, although of somewhat apocalyptic name commonly referred to books that only manage to attract with their title, is actually an interesting book that approaches economic issues in a professional and informed manner, in same time being thought-provoking.

The author has succeeded in his book to develop its subject in less than four hundred pages, which is not so often, considering that the books which at the same time speak about economic theory and predictions of the future are usually very extensive, and often illegible except for a narrow academic circle.

I read Rickards previous book ‘Currency Wars’ and his economic forecasts, given that I share same profession with author, largely coincide with my own; consequently I really liked his book.

Exactly the same situation is with his latest book in which the author foreshadows an interesting (at least on paper) future of money and all that could start happening in the world economy in case of some scenarios already seen in the past would repeat.

And even after reading the book it seems that the end is near, the author gives recommendations on how to survive the uncertain times that lie ahead; he gives reasons why this is the right time to change money into objects whose value will certainly not decline in uncertain times that expect the world's currencies, things that have proven its value through the history, such as works of art, land or gold.

I would not go into the discussion chapter by chapter because my fellow reviewer has done it exceptionally-well and there is no need to repeat, but in any case I can recommend this book to all those who enjoy reading about the economics, and have more advanced knowledge or are at least willing to learn about it.

After reading the author’s two books, it can be certainly said that James Rickards is one of the authors that marked the economics scene in the last 5 years, so all the recommendations to this as well as his previous work.
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202 of 230 people found the following review helpful
2.0 out of 5 stars A CIA-Centric Analysis, April 22, 2014
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In interviews Jim Rickards frequently refers to his war games work with the CIA. He sure sounds like an insider and that's good right? It can be if your team has a good track record. So, who's on the team?

In the Death of Money Jim Rickards calls the fictional 911 Commission Report a "monumental and excellent summary". He scoffs at the suggestion of US government involvement and, as expected, won't discuss the free-fall of Building 7 or the coincidental direct hit on the Pentagon in the exact area where they were investigating the trillions in unaccounted defense dollars. These and many other facts contradict the commission report but Rickards is able to compartmentalize away these exceptions to his preferred conclusion.

He then discusses financial markets and the insider trading prior to 911. He says the trading was started by someone in the terrorists' social network (no proof supplied) and Wall Street traders piled onto the little trade to turn it into an innocent big trade. This was explained, Rickards says, by former CIA man Randy Tauss who likes to trade options as a sideline and figured it all out. Really! So, it was a foreign terrorist who did the insider trade and not someone in-the-know within the US? Not true. Max Keiser was one of Wall Street's biggest options traders at the time. He says the trades smell like CIA. "millions of dollars worth of profits from 9/11 insider trading still sit uncollected in an Alex Brown account in Baltimore, just down the road from the CIA's HQ at Langley." (rt.com/op-edge/158988-bankers-killing-suicide-fraud/)

What else did Tauss figure out? I'd ask you to google Randy Tauss and TWA Flight 800. Rickards says Tauss while employed by the CIA solved the mystery of the 1996 TWA Flight 800 crash that killed over 200 people. Not so fast, Jim. Tauss has been accused of putting together an inaccurate video narrative which took researchers on the wrong path. "On June 19, 2013, a documentary alleging that the investigation into the crash was a cover-up ... with statements from six members of the original investigation team, now retired, who also filed a petition to reopen the probe." (en.wikipedia.org/wiki/TWA_Flight_800_conspiracy_theories). Senior investigators say the NTSB final report is wrong and they were intimidated by the FBI to go along with the lie. Government claptrap and disinformation permeates the mainstream news. It wasn't a flash fire but a Navy missile mistake that brought down Flight 800. The facts support the dissenting investigators. [...]

Randy Tauss and Jim Rickards both are managing directors at Onmis, an information analytics firm.
(omnisinc.com/directors.php). Judging by the directors, this firm is loaded with CIA/Intelligence types. Another director, Charles Deulfler, "led the Iraq Survey Group (ISG) that conducted the investigation of the scope of Iraq's WMD". I get the feeling these guys are telling the intelligence community that their firm is available to spread preferred memes to the American public. Too harsh? Folks, look at the insane wars and now the activities of the NSA. In DC, influence and corruption are always for sale.

Rickard's book reads like a scenario planning white paper. The IMF with its SDRs is the desired outcome for the security state because the existing framework provides for an orderly financial reconstruction and the possibility for renewed American dominance. To me, the book starts with the desired CIA conclusion and works backwards. I think Rickards is sincere and confident and his book is a smart analysis. However, we know the CIA has made a mess of the Middle East and is implicated in assassinations, gun running, importing cocaine into American inner cities and much more. White papers preceded each of these disastrous outcomes.

I don't have a high confidence level in this kind of scenario planning but it's necessary to start somewhere. The Death of Money is a well written work by a keen mind and presents actionable advice. Mr. Rickards might be right but the actual end game could be much more chaotic. I agree with Rickards that American pensions and entitlements will be early victims of economic chaos. If nothing else the book should prod readers to take a defensive position immediately.

Readers should keep in mind that Rickards seems to have a strong national security state bias. These people have a wag the dog world view that can be self deluding. I'm especially concerned by his belief in the 911 propaganda and question his judgment when he calls Rumsfeld, Cheney and Wolfowitz "giants of national security policy". I guess this obsequiousness is a requirement though for splashing around in D.C.'s profitable national security cesspool. Rickard's advice to buy expensive art and vacant land is not something middle class people should do. Readers should carefully consider his ideas but not abandon critical thinking.
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95 of 110 people found the following review helpful
1.0 out of 5 stars Did Al Qaeda Cash in on the 9/11 Attacks?, July 27, 2014
By 
Mark H. Gaffney (Chiloquin, OR USA) - See all my reviews
(REAL NAME)   
This review is from: The Death of Money: The Coming Collapse of the International Monetary System (Hardcover)
So says James Rickards, author of the hot bestseller, The Death of Money, The Coming Collapse of the International Monetary System, which presents a persuasive argument that citizens of planet earth face an imminent global financial meltdown, one that will make 2008 look like a warm up.

Rickards' book includes insightful chapters about Germany and the Eurozone, the BRICS, China, the IMF, as well as a clear analysis about how the Federal Reserve has painted itself into a fiscal corner from which there is no exit and now faces insolvency.

Unfortunately, to get to all of this valuable material the reader must first wade through hip-deep hogwash in chapter one, in which the author reviews the evidence for insider trading in the days before the 9/11 attacks.

In chapter one Rickards' otherwise clear vision fails him.

The author is absolutely correct that pre-9/11 insider trading did occur. Rickards also correctly notes that "every transaction has two parties," meaning that every put and call option leaves a paper trail. But Rickards insults our intelligence when he tells us that associates of Osama bin Laden were responsible for the insider trading.

Rickards would have us believe, for example, that the terrorists were behind the 600% spike in call options for the military contractor Raytheon, whose stock surged 37% in the weeks after 9/11. Other big winners were L-3 Communications, Northrop Grumman, and Allied Techsystems.

According to Paul Zarembka, professor of econometrics at SUNY Buffalo, the put/call options were exercised, meaning that whoever purchased them later collected the profits, blood money. But is it believable that the very same terrorists who sought to destroy America got away with profiting from the subsequent vast expansion of the US war machine?

Catching those responsible certainly was the intent of the Securities and Exchange Commission, which led the probe into allegations of insider trading in the weeks after 9/11. At the time, SEC chairman Harvey Pitt told the press "We will do everything in our power to track those [guilty] people down and bring them to justice." Everyone took it for granted that the paper trail would lead to al Qaeda.

Yet, weeks later, the SEC quietly and inexplicably tabled its investigation. Why? Instead of issuing indictments, the SEC took the unprecedented step of deputizing everyone associated with its probe. This totaled hundreds, possibly thousands, of people. Why did the SEC do this? The answer was transparently obvious to former LAPD narcotics investigator Mike Ruppert, who pointed out that the SEC deputized its investigators to effectively gag them, no doubt, to prevent leakage of its actual findings. And what were those findings? Well, probably the inconvenient truth that the paper trail led not to bin Laden but back to Wall Street.

As we know, there was leakage despite the SEC's best efforts to keep a lid on things. The Independent (UK) reported that "to the embarrassment of investigators, it has emerged that the firm used to buy the put options on United Airlines was headed until 1998 by Alvin "Buzzy" Krongard, now executive director of the CIA." George Tenet had personally recruited Krongard, probably to serve as his liaison with Wall Street.

The firm in question was America's oldest investment bank, A.B. Brown, which merged with Bankers Trust in 1997. In 1999, when B.T. - Alex Brown pled guilty to criminal conspiracy charges, after it was revealed that top-level executives had created a $20 million slush fund out of unclaimed funds, B.T. - Alex Brown was on the verge of being closed down when Deutsche Bank scooped it up.

Krongard's former associate at Alex Brown, Mayo Shattuck III, who helped engineer the merger with Bankers Trust, went on to assume Krongard's former duties as private banker to the firm's wealthiest clients, personally arranging confidential transactions and transfers. According to the New York Times, in January 2001, Shattuck was named "co-head of investment banking....overseeing Deutsche Bank's 400 brokers who cater to wealthy clients."

Shattuck's sudden resignation on September 12, 2001 must therefor be viewed as highly suspicious. Shattuck retired without a word of explanation even though he reportedly had three years remaining on his contract.

All of the above is conspicuously absent from Rickards' discussion about insider trading. One may draw his/her own conclusions -- I have drawn mine. Even as we teeter on the brink of a financial meltdown of historic proportions, the insider-writer who would explain all of this cannot bring himself to acknowledge the true extent of Wall Street corruption and criminality, especially regarding 9/11, the fulcrum event that produced the world as we know it.

Mark H. Gaffney, author, Black 9/11 (2012)
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21 of 22 people found the following review helpful
5.0 out of 5 stars Crucial Roadmap For the Future of the Global Economic Landscape - This Book Deserves Ten Stars, April 13, 2014
By 
Nancy Berg (Mukilteo, WA United States) - See all my reviews
This review is from: The Death of Money: The Coming Collapse of the International Monetary System (Hardcover)
James Rickards once again delivers an outstanding book regarding the international monetary system and the weight it bears on not only the economy, but geopolitics as well. Rickards initially sets the tone by illuminating the historical paths of previous monetary collapse, inflation, deflation and economic complexity. He illuminates economic complexity as an exponential risk for catastrophe. Rickards then teaches and guides the reader regarding the implications of the collapse of the dollar and the ubiquitous global ramifications.

As was the case with his first book Currency Wars, The Death of Money is not only rich with analysis, conclusive evidence and prediction – Rickards weaves his vast and varied domestic and global dealings into a vivid tapestry that provides readers a glimpse into a world of intrigue, investigation and behind-closed-door planning at high levels. Unlike so many books addressing economics, The Death of Money is not just a book for market or econ-wonks, but *essential* reading for those interested in analyzing current and future geopolitical ramifications, with global markets as an important and unmistakable linchpin in asymmetric warfare. Rickards is masterful at addressing this vital interconnectivity like no other.

From 9-11 insider trading to China's financial warlords to U.S. monetary and fiscal policy; this book covers more territory than you might expect. It is an important resource not only for market and geopolitical professionals, but average investors and consumers as well. Rickards generously concludes the book with recommendations for investing to protect personal assets before the economic landscape shifts in a way most will not see coming.

Much like Currency Wars, I will be reading this several times over as monetary and economic history unfolds in real-time. Jim Rickards has the most uncanny ability to accurately analyze and predict what lies ahead, and important steps to protect personal assets. The Death of Money is a must-read.
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13 of 13 people found the following review helpful
4.0 out of 5 stars Slouching Towards A New Economic Order, September 28, 2014
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This review is from: The Death of Money: The Coming Collapse of the International Monetary System (Hardcover)
Despite its apocalyptic title, this is not really an end-of-days book. James Rickards is an astute analyst, and what he's writing about here is not really disappearance of the international monetary order so much as its transition into something radically new. What sets him apart from at least some of the other writers focusing nowadays on similar issues is that he has some fairly well-grounded ideas about what shape the new order may be trying to take. And while we're not talking quite Book of Revelation stuff here, the metamorphosis he envisions is inevitably a traumatic affair, particularly for the United States, whose currency enjoys a privileged status that cannot be expected to survive the approaching seismic shift.

So far as I can tell, Mr. Rickards is not an academically-trained economist. He is a fund manager who focuses on macro issues affecting his investments. However, he's well enough respected for his knowledge of the global monetary system that the U.S. Defense Department consults with him in war-scenario planning exercises, where hypothetical attacks against financial market targets are standard fare anymore. And he seems well-enough versed in conventional economic theory too. He just doesn't consider it much help in coming to grips with the real crisis affecting the global economy today.

For Rickards is a student of "Complexity Theory". And as such he does not offer any neatly-packaged prognostications of the type dear to the hearts of most academic economists. Complexity theorists, when applying their vision to economics, see financial markets as seas of mostly hidden variables, all of them playing off one another in ways that can never be predicted with any semblance of exactitude. Small movements morph into storms before much at all is apparent. And while the rough direction of things can sometimes be discerned, sudden events have a way of exploding out of nowhere and turning the picture upside-down. For economists and investors, according to Rickards, this is just the nature of the environment they inhabit, whether they know it or not.

Economic complexity is bad enough at a national level. It becomes orders of magnitude worse when we go global. In this book Rickards takes us on a quick guided tour of the world's economies, and he doesn't show us much to bring comfort to anyone hoping for a orderly resolution to our current problems. The United States is front-and-center to his critique, because the dollar remains the world's most important currency, and its precarious state threatens everybody. He flogs the dollar with the usual observation, i.e., that chronic trade and budget deficits and decades of increasingly easy money support a national consumption we've lost the ability to pay for. He says we get away with it only because of the reserve currency status, which forces other countries - most importantly China - in greater and lesser degrees to benchmark their currencies to the dollar, thereby exporting to them what should be domestic inflation in the U.S.

Interestingly, though, he is if anything even harder on China than he is on the U.S. He considers China ruled by what the calls a "parasitic elite" which manipulates a centralized state for its own benefit while distorting its economy with massive and wasteful infrastructure spending. He seems to regard China as a bubble economy and a huge crash site awaiting impact.

Making his way around the major economies, Rickards hammers Japan a well. He portrays it as a sort of microcosm for the rest of the developed world, calling it the "canary in a coal mine". Coping for many years with deflationary pressures, Japan is now, under Prime Minister Abe, attempting to break out with massive inflationary over-compensation that offers little hope of finding a stable equilibrium.

In what might strike some readers as incongruous, Rickards actually takes a moderately optimistic tone in his discussion of Europe. Dismissing the fears of "Euro-skeptics" , he argues that the economic power of Germany is sufficient to ensure the Euro's survival. Conceived as a kind of monetary glue for holding Europe together, the Euro is central to Germany's determination to ensure a permanent end to the continent's history of cataclysmic internecine wars. Survival, however, does not imply stability, and in the last analysis Rickards sees the Euro as one more in the global stew of fiat currencies headed towards a reckoning

He rounds out his monetary tour with brief discussions of the world's peripheral markets that Western bankers have, for marketing purposes, cobbled together under various cutesy acronyms: BRICS, BELLs, GIIPS, PIGS, and so forth. Rickards sees tiny rays of hope in certain of these places, but within the context of his Complexity Theory world view, any one of them is capable harboring the hidden spark poised to trigger a global contagion.

Which brings us around to Rickards' Idée Fixe, which is Gold. Insisting he is not a "Gold Bug", Rickards at one point even pokes gentle fun at theorists who see a return to a gold monetary standard as the only hope for heading off economic apocalypse. However, he then goes on to demonstrate that the pejorative term hardly has any meaning if it doesn't apply to him. For Rickards subscribes to the belief that gold itself is the only "true" money, and that its value is fixed. Apparent movements in its price should instead be viewed as fluctuations in the prices of the world's various fiat currencies, all of which revolve around it like so many planets orbiting the sun. This is, of course, a semantical point that is axiomatically true if we buy into his way of thinking. Most people, including myself, find it little hard to swallow today, in light of the fact that not one of the world's central banks recognizes any official relationship between gold and the value of its currency.

Rickards, however, works very hard to cover his base. He devotes quite a bit of text to the behavior of our central banks, who have since officially demonetizing gold in the 1970's, continued not only to hold it in large quantities but to actively trade it. Some banks, notably those of China and Russia, have even taken to accumulating new gold directly from their national mining industries. Those of us tending to see monetary gold as an anachronism generally have a hard time explaining this behavior. Rickards, for his part, explains it matter-of-factly. Far from seeing central bankers as out-of-touch bureaucrats, he writes about them as though they were about the only people in the world today really understanding what's going on, even if their true goals remain hidden behind their public agendas. He implies that, as a group, they fully understand that the fiat currency systems they manage are headed for collapse, and that they are all scrambling to pre-position themselves for the new monetary order. He doesn't portray them as wicked conspirators so much as institutions jockeying for position among themselves while struggling to salvage a degree of order out of the impending chaos.

Richards views the International Monetary Fund, far from being the obsolete institution some observers consider it to be, as standing front and center in the new international system. Its Special Drawing Right instrument, created in 1969 as a Reserve Currency supplement, has since its inception remained in the shadow of the U.S. dollar. Rickards, however, sees it or something akin to it emerging in the new order as the primary international reserve asset and a kind of global money, albeit in a radically redesigned form. The world's existing powers will negotiate the new design, with the power of their negotiating positions being determined, as it was at Bretton Woods in 1944, by their gold holdings and by the relative size of their economies. The existing SDR represents a basket of currencies - dollar, euro, yen, and pound - that is plainly obsolete and will be re-examined under the blazing light of crisis and replaced with something more representative of the world's economic balance. The dollar will still have power but one far diminished on a relative basis, particularly with regard to China's RMB.

What this means for Americans, if Rickards is right, is that our reserve currency subsidy will disappear and the purchasing power of our money will be sharply diminished. Living for us will become a lot more expensive.

I'm sure that many readers regard James Rickards as a crackpot, and this book does indeed at times verge on crankishness. However, he's too knowledgeable and writes in too measured a tone for his views to be dismissed quite so readily in my opinion. At the very least, Death of Money is informative and thought-provoking, and I recommend it.
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12 of 12 people found the following review helpful
5.0 out of 5 stars This is a great book..., May 23, 2014
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This review is from: The Death of Money: The Coming Collapse of the International Monetary System (Hardcover)
This is a great book, the second I have read by James Rickards. He's written the previous best selling book, "Currency Wars". Mr. Rickards has had a career in varied realms, he has degrees in Int'l. Economics (went to grad school with the likes of Timothy Geitner) and several legal disciplines. He's a regular on many MSM including CNBC where I first saw him about 8 years ago. He's an insider in more ways than one. Six years ago he pointed out that China was bent on accumulating gold to diversify their assets (boy was he right). Then 3 years ago he began talking about plans to revive an old 1960's era monetary maneuver which he called "Operation Twist", sure enogh a couple of months later the Fed announced Operation Twist which entailed buying long term US Treasury debt and selling short term. So when Mr. Rickards speaks I sit up and listen. In this book he talks about what is bound to happen with our present US$ based monetary system, how to recognize what is happening and the various ways this could play out. None of the three scenarios is good for us here in the USA, however, there are ways to prepare for these eventualities, woe to the unprepared. One likely way this could play out is by the IMF assuming the task of issuing world currency in the guise of the SDR which was first issued in the 1970's and has once again been undergoing much expansion on their balance sheet since the 2008 near meltdown.

“The next financial collapse will resemble nothing in history. . . . Deciding upon the best course to follow will require comprehending a minefield of risks, while poised at a crossroads, pondering the death of the dollar.”

"The international monetary system has collapsed three times in the past hundred years, in 1914, 1939, and 1971. Each collapse was followed by a period of tumult: war, civil unrest, or significant damage to the stability of the global economy".

Mr.Rickards shows why another collapse is rapidly approaching and this time it will be bigger than the Fed.

"The American dollar has been the global reserve currency since the end of the Second World War. If the dollar fails, the entire international monetary system will fail with it. No other currency has the deep, liquid pools of assets needed to do the job.

Optimists have always said, in essence, that there’s nothing to worry about—that confidence in the dollar will never truly be shaken, no matter how high our national debt or how dysfunctional our government. But in the last few years, the risks have become too big to ignore. While Washington is gridlocked and unable to make progress on our long-term problems, our biggest economic competitors—China, Russia, and the oilproducing nations of the Middle East—are doing everything possible to end U.S. monetary hegemony. The potential results: Financial warfare. Deflation. Hyperinflation. Market collapse. Chaos".
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57 of 69 people found the following review helpful
1.0 out of 5 stars Modified Limited Hangout, August 5, 2014
This review is from: The Death of Money: The Coming Collapse of the International Monetary System (Hardcover)
Foreword: After this review was written William Kaye, Managing Partner of the Greater Asian Hedge Fund discussed US Dezinformatzia in gold. See "Trip Down The Rabbit Hole Of US Lies & Disinformation Agents" at:

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2014/8/18_Trip_Down_The_Rabbit_Hole_Of_US_Lies_%26_Disinformation_Agents.html

Continuing with the original review:

Rickards is an investment banker, an insider and apparently a shill who brags about his relationship with the CIA. As John Ehrlichman might have said this book reads like "It's a modified limited hang out." To take an example, Rickards repeatedly and gratuitously insults 9/11 truthers -- quite irrelevant to his topic.

The current dire situation is minimized in vital ways. The massive fraud in economic statistics is not discussed.
BLS methodologies, for example, have been manipulated to minimize unemployment and inflation.
Minimizing inflation in turn exaggerates GDP and understates the critical Debt to GDP ratio.

This book, published in April, ignores the import of gigantic events like JP Morgan selling their NYC HQ to China for a knockdown price.
Listen to Dr. Jim Willie and you will learn that they defaulted on a huge gold contract. Also ignored is the systematic "suiciding" of mid-level bankers. Listen to "V" the Guerrilla Economist who predicted the "suicides" a month before it they began and you learn there is a hit team at work. Apparently the banks have also taken out "peasant insurance" to cash in on their clean up of those who know too much about the fraud.

Rickards finesses one of the most important economic story of the new century --
German's demand for repatriation of their gold. He doesn't discuss the NY fed's outright refusal to return 80% of the 1500 tons of German gold supposedly on deposit, their incredible seven year repatriation schedule and their complete failure to meet even that. Only five tons returned in the first year and the Germans had to give up because the gold is all gone. Act now while supplies last!

If you want to know what is really going on disconnect your TV and go to: www.zerohedge.com, www.kingworldnews.com, www.shadowstats.com, www.goldenjackass.com, www.silverdoctors.com, www.usawatchdog.com, www.roguemoney.net, www.infowars.com and Finance and Liberty on Youtube. I'm not affiliated with any of them.
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10 of 11 people found the following review helpful
5.0 out of 5 stars A tour de force of macroeconomic developments around the world., June 1, 2014
By 
GM (SF Bay Area, CA USA) - See all my reviews
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Don't get fooled by the cheesy title, this is a serious book written by a highly respected expert. If you've been following the macro environment just by reading the news, then you'll learn a lot from this book. It's speculative in places (as the title suggests), but I'd highly recommend it overall.

Want to share a passage which I found interesting:

"Another unintended consequence of Fed policy involves the impact on savers. The Federal Reserve's zero-interest-rate policy causes a $ 400 billion-per-year wealth transfer from everyday Americans to large banks. This is because a normalized interest-rate environment of 2 percent would pay $ 400 billion to savers who leave money in the bank. Instead, those savers get nothing,and the benefit goes to banks that can relend the free money on a leveraged basis and make significant profits. Part of the Fed's design is to penalize savers and discourage them from leaving money in the bank, and to encourage them to invest in risky assets, such as stocks and real estate, to prop up collateral values in those markets.

But many savers are inherently conservative and with good reason. An eighty-two-year-old retiree does not want to invest in stocks because she could easily lose 30 percent of her retirement savings when the next bubble bursts. A twenty-two-year-old professional saving for a down payment on his first condo may avoid stocks for the same reason. Both savers hope to get a reasonable return on their bank accounts, but the Fed uses rate policy to ensure that they receive nothing. ****As a result, many citizens are saving even more from retirement checks and paychecks to make up for the lack of a market interest rate****. So a Fed manipulation designed to discourage savings actually increases savings, on a precautionary basis, to make up for lost interest. This is a behavioral response not taught in textbooks or included in models used by the Fed." (Emphasis mine).

The author is spot on. CD rates? Zero. Treasury yields? 2.6%. S&P500 corporate-earnings yield? Around 4.5% as of June '14 (10 year averaged, corrected for lag). Fed repression at work. We all need to save more and pick our own devil. FED's policies are encouraging saving rather than consumption when asset valuations are so high.

I'd also recommend: Code Red: How to Protect Your Savings From the Coming Crisis by Mauldin et al; another excellent book on the current macroeconomic environment.
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