Thorsten Polleit

Thorsten Polleit

Dr. Thorsten Polleit, Chief Economist of Degussa and macro-economic advisor to the P&R REAL VALUE fund. He is Honorary Professor at the University of Bayreuth.

Articles by Thorsten Polleit

Rising Interest Rates and the “Great Reset” Bubble

While the “Great Reset” involves an unholy alliance between governments and big businesses, implementing its policies is impossible without central banks suppressing interest rates. Now that rates are rising, people are finding firsthand the real costs of the “Great Reset.”
Original Article: Rising Interest Rates and the "Great Reset" Bubble

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Rising Interest Rates and the “Great Reset” Bubble

Even though many deny it, the “Great Reset” exists, referring to a set of ideas that range from “stakeholder capitalism” to “wokeness” and “fourth industrial revolution” to “transhumanism.” It is effectively popularized especially through the World Economic Forum. The fight against viruses and epidemics and particularly the politically driven move away from fossil fuels to “save the global climate” are probably the most visible footprints of the Great Reset agenda.
In a nutshell, the Great Reset is a politically planned overthrow of the global economic and social system—a restructuring—and this most audacious endeavor has gained strong momentum in the wake of the central banks’ extremely low interest-rate policies in recent years. This finding is anything but surprising for those aware of

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The Economic Wisdom of Antony C. Sutton’s The War on Gold

I.
Antony C. Sutton (1925–2002) was a British economist and economic historian who taught at California State University, Los Angeles. Sutton was also a research fellow at the Hoover Institution at Stanford University.
His work focused primarily on the financial and commercial cooperation between major United States banks and corporates (call it “Wall Street interests”) and foreign states that were openly hostile to America.
In his book Wall Street and the Bolshevik Revolution (1974), Sutton used extensive data and documents to point out that, for instance, Wall Street interest groups financed and promoted Bolshevik Russia.
In Sutton’s book Wall Street and FDR: The True Story of How Franklin D. Roosevelt Colluded with Corporate America (1975), he paints a highly critical picture of the

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100 Years Ago Today: The End of German Hyperinflation

On 15 November 1923 decisive steps were taken to end the nightmare of hyperinflation in the Weimar Republic: The Reichsbank, the German central bank, stopped monetizing government debt, and a new means of exchange, the Rentenmark, was issued next to the Papermark (in German: Papiermark). These measures succeeded in halting hyperinflation, but the purchasing power of the Papermark was completely ruined. To understand how and why this could happen, one has to take a look at the time shortly before the outbreak of World War I.
Since 1871, the mark had been the official money in the Deutsches Reich. With the outbreak of World War I, the gold redeemability of the Reichsmark was suspended on 4 August 1914. The gold-backed Reichsmark (or “Goldmark,” as it was referred to from 1914) became the

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The Interest Rate Shock Will Blow Up the Government’s Ponzi Game

In the international fixed-income markets, interest rates are rising, and the decades-long trend of declining bond yields has undoubtedly been broken. On August 2, 2022, the ten-year United States Treasury yield was 0.5 percent; on October 9, 2023, it had risen to 4.8 percent. Long-term interest rates in Europe, Asia, and Latin America have also risen sharply. The key reason for the rise in capital market interest rates is the central banks’ interest rate hikes—a direct response to sky-high inflation (caused by the central banks themselves, following a huge increase in the quantity of money).
Figure 1: Ten-year US Treasury bond yield with constant maturity from January 1981 to October 11, 2023 (percent)

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Source: FRED. Data from the

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A Ticking Time Bomb: A Huge National Debt Plus Rising Interest Rates

Those who have been predicting a recession in the United States and an associated stock market crash seem to be having a hard time. At least, it appears so. US gross domestic product grew by 2.1 percent in Q2 2023, after growing 2.0 percent in Q1; the unemployment rate was rather low at 3.8 percent in August 2023; and the S&P 500 was at 4,460 points, around 10 percent below the index record of 4,818 points from January 2022. Yet, there are many variables that yield a point to the prophets of doom.
For instance, high inflation has reduced the real incomes of people and businesses, lowering their demand for goods and services. The increase in credit costs, which began in early 2022 with the Federal Reserve interest rate hike, should (at least) slow down consumption and investment—and lead to

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What the Central Bank Cartel has Planned for You

The Austrian(TA): What is the global currency plot, and who benefits most from the success of this effort?
Thorsten Polleit (TP): The global currency plot denotes a rather inconvenient truth: the existence of states (as we know them today) sets into motion a dynamic process toward creating a single world fiat money controlled by a world central bank, and most likely a central world government. The beneficiaries will be the very few—the “elite”—in charge of running the state and those few privileged by the state, such as big business, big banking, Big Pharma, and Big Tech. However, the great majority of the people will suffer a very great disadvantage. In fact, a single world fiat currency would most likely entail tyranny.
TA: The first half of the book is largely focused on economic theory

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What Will It Take for Cryptocurrencies to Become Full-Fledged Money?

Bitcoin is the beginning of something great: a currency without a government, something necessary and imperative.1– NASSIM TALEB
The crypto-unit bitcoin2 holds out the prospect of something revolutionary: money created in the free market, money the production and use of which the state has no access to. The transactions carried out with it are anonymous; outsiders do not know who paid and who received the payment. It would be money that cannot be multiplied at will, whose quantity is finite, that knows no national borders, and that can be used unhindered worldwide. This is possible because the bitcoin is based on a special form of electronic data processing and storage: blockchain technology (a “distributed ledger technology,” DLT), which can also be described as a decentralized account

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The BRICS Currency Project Picks Up Speed

On Friday, July 7, 2023, news broke in the financial market media that the “BRICS” (that is, Brazil, Russia, India, China, and South Africa) will implement their plan to create a new international currency for trading and financial transactions, and that this new currency will be “gold-backed”.
Most recently, on June 2, 2023, the foreign ministers of the BRICS – as well as representatives from more than 12 countries – met in Cape Town, South Africa (interestingly at the “Cape of Good Hope”). Among other things, it was emphasized that they wanted to create an international trading currency. Undoubtedly, this is an undertaking that could have consequences of epic proportions.
After all, the BRICS countries represent about 3.2 billion people, approximately 40 per cent of the world’s

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The Fed Is Overindebted, Isn’t It?

By any conventional measures of finance, the Federal Reserve has negative equity. In the long run, cooking the books only puts off the day of reckoning.

Original Article: "The Fed Is Overindebted, Isn’t It?"

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The Fed Is Overindebted, Isn’t It?

Behind closed doors, the report is already making the rounds in expert circles: if you follow the rules of sound commercial accounting, the United States Federal Reserve (Fed) has lost its equity and is, as common language would have it, bankrupt. What happened?
During spring 2020 (i.e., in a period of extremely low interest rates), the Fed purchased large amounts of government bonds and mortgage bonds to support the economy and financial markets during the covid crisis.
The Fed paid for the purchases by issuing vast amounts of new central bank money. This has created an enormous “money surplus” in the US interbank market, where banks lend money to one another. It is exactly in this market where the interest rates for all other credit markets are determined.
However, the excess money

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No, the Financial Crisis Is Not Over

As markets settle down after the last set of bank failures, political elites claim the crisis is behind us. But it is not over, not by a long shot.

Original Article: "No, the Financial Crisis Is Not Over"
This Audio Mises Wire is generously sponsored by Christopher Condon.

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The Road to a Single Fiat World Currency

What if the world’s states were to come together and create a single world currency? From a purely economic point of view, there would be significant advantages if every nation didn’t operate with its own money but with the same currency. Not only for an individual economy, but for the world economy as a whole, the optimal number of currencies is one. Let’s take a look.
The decisive factor is how this single world currency comes about, and who issues it. In a free market for money—in a natural process—a single world currency would emerge from the voluntary agreements of the market participants: the money demanders would decide which commodity they want to use as money. It is impossible to predict with certainty what the outcome of the free choice of currency would be; after all, it

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No, the Financial Crisis Is Not Over

The collapse of California-based Silicon Valley Bank (and Signature Bank in New York) on March 10, 2023, sent shock waves through the international financial system. It not only made bank stocks and bank bonds fall sharply but also finally brought ailing banking giant Credit Suisse to its knees. The Swiss bank had to be rescued and was bought by UBS on March 19, 2023. In another wave of market fear, Deutsche Bank, another global systemically important bank, came under pressure: its share price fell sharply, and credit default swap spreads on its liabilities skyrocketed.
In the meantime, however, market stress seems to have subsided. It is fair to say that the Federal Reserve (Fed) and the US Treasury have pulled it off. The Fed opened its funding spigots for banks, providing them with the

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Odds Are Rising That the Fed Will Trigger the Next Bust

From March 17, 2022, to the end of January 2023, the US Federal Reserve (Fed) increased its federal funds rate from practically zero to 4.50–4.75 percent. The rise in lending rates came in response to skyrocketing consumer goods price inflation: US inflation rose from 2.5 percent in January 2022 to 9.1 percent in June. Notwithstanding inflation falling to 6.4 percent in January 2023, the Fed continues to signal to markets that it will continue to hike rates to bring down consumer price inflation.
This is understandable. The Fed wants to maintain its inflation-fighting credentials; it wants people to believe it is really determined to bring inflation back to 2 percent. It is presumably well aware that the US dollar’s world reserve currency status needs to be protected more than ever, as it

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The Global Currency Plot

Democratic socialism—the ideology that dominates the world today—aspires to become a world state. The route toward it requires a single world currency to be created. That would undoubtedly create a dystopia. Might this become a reality? And if so, how can it be averted? This book aims to find answers to these questions.

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Objection, Professor Harari! Logic Proves the Existence of Free Will

Yuval Noah Harari, professor of history at Hebrew University in Jerusalem, is not only a best-selling author but also a top advisor to Klaus Schwab, founder and front man of the World Economic Forum (WEF).
In 2018, Harari wrote: “Unfortunately, ‘free will’ isn’t a scientific reality. It is a myth inherited from Christian theology.”
And, in a 2019 interview, Harari said:
Humans today are a hackable animal—an animal that can be hacked. . . . Hacking a person means understanding and seeing through them better than they can themselves. . . . The consequences are obvious: Anyone who knows people’s inner feelings can anticipate their actions. And, of course, manipulate their desires. Ultimately, these institutions (companies and states are meant here, TP) will make more and more decisions on our

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Can the Dollar Once Again Be Anchored by Gold? One Congressman Believes It Can

On October 7, 2022, US congressman Alex Mooney (a Republican from West Virginia) introduced a bill (the Gold Standard Restoration Act, H.R. 9157) that stipulates that the US dollar must be backed by physical gold owned by the US Treasury. The initiative clearly indicates that the increasingly inflationary US dollar is triggering efforts to get better money.

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Inflation, High Inflation, Hyperinflation

The word “inflation” is heard and read everywhere these days. However, since different people sometimes have very different understandings of inflation, here is a definition: Inflation is the sustained rise in the prices of goods across the board.

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Everything You Wanted to Know about Money, but Were Afraid to Ask

Introduction. With my talk, I would like to accomplish three goals:
First, I want to explain some sound and time-tested basics of monetary theory.
Second, I would like to point out why it is important to have a free market in money; that the battlefront of our time is not between, say, bitcoin, stable coins, gold, and silver, but between government-monopolized fiat monies and a free market in money.

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On the Digital Future of Markets and Money

Thank you very much for the invitation. I am delighted to have the opportunity to share some thoughts with you on a topic I am very much interested in and that I believe is of the utmost importance to people around the globe—and that is “the digital future of markets and money.”

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Freedom and Sound Money: Two Sides of a Coin

It is impossible to grasp the meaning of the idea of sound money if one does not realize that it was devised as an instrument for the protection of civil liberties against despotic inroads on the part of governments. Ideologically it belongs in the same class with political constitutions and bills of right.

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Staat und Krieg

Aus ökonomischer Sicht lässt sich argumentieren: Der Staat (wie wir ihn heute kennen) ist aggressiv. Kriegerische Auseinandersetzungen zwischen Staaten sind daher auch kein tragischer Zufallsfehler, sie sind vielmehr ein logisches Ergebnis.

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Berliners in 2021 Want to Expropriate Private Housing

On September 6, 2021, the city-state of Berlin, Germany’s capital, held a referendum: voters in Berlin had to decide whether thousands of housing units owned by “large real estate firms” should be nationalized. 56.4 percent voted yes, 39 percent no. 

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Fiat Money Economies Are Built on Lies

Now and then, it pays to take a step back to get a broader perspective on things, to look beyond the daily financial news, to see through the short-term ups and downs in the market to find out what is really at the heart of the matter. If we do that, we will not miss the fact that we are living in the age of fiat currencies, a world in which basically everything bears their fingerprints: the economic and financial system, politics—even people’s cultural norms, values, and morals will not escape the broader consequences of fiat currencies.

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Das staatliche Geldmonopol und der „Große Reset“

15. März 2021 – von Thorsten PolleitThorsten PolleitDas ungedeckte Papiergeldgeldsystem – man kann es auch als Fiat-Geldsystem bezeichnen – ist wirtschaftlich und sozial äußerst problematisch. Es verursacht Schäden, die vermutlich weit über die Vorstellungen der meisten Menschen hinausgehen.

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„Hayek und die Pandemie“: Das irreführende Narrativ des Neo-Keynesianismus in der F.A.Z.

Was sagt Hayeks Liberalismus dazu? Am 5. Februar 2021 hat der Ökonom Arash Molavi Vasséi den Aufsatz „Hayek und die Pandemie“ in der F.A.Z. veröffentlicht. Er will darin aufzeigen, wie seiner Meinung nach Friedrich August von Hayek (1899–1992) die Politiken, zu denen die Staaten in der Coronavirus-Pandemie greifen, vor dem Hintergrund „liberaler Prinzipien“ beurteilen würde.

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Absolute Eigentumsrechte als ökologischer Imperativ

In diesem Vortrag argumentiere ich, dass (1) Eigentum und Umwelt- beziehungsweise Ressourcenschutz keine Gegensätze sind; dass (2) man vielmehr auf das Eigentum setzen muss, wenn Umwelt und Ressourcen wirksam geschützt und ein tyrannischer Weltstaat verhindert werden sollen; und dass (3) der Staat (wie wir ihn heute kennen) der eigentliche Grund für Umwelt- und Ressourcenschäden ist.

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Inflation Breeds Even More Inflation

I. Warning against Fiduciary Media. Early in the 20th century, Ludwig von Mises warned against the consequences of granting the government control over the money supply. Such a regime inevitably creates money through bank credit that is not backed by real savings—a type of money that Mises termed "fiduciary media."

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Inflation as a Tool of the Radical Left

Rising money stock meets shrinking production, 2000-2020

“Lenin is said to have declared that the best way to destroy the Capitalist System was to debauch its currency….Lenin was certainly right. There is no subtler, no surer way of overturning the existing basis of society than to debauch the currency.

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New Opportunities for Marxists: Climate Change and Coronavirus

In The Communist Manifesto (1848) Karl Marx (1818–83) and Friedrich Engels (1820–95) predicted that capitalism would lead to the impoverishment of the laboring class. Why? Well, to raise profit on capital invested, Marx and Engels argued, entrepreneurs (the capitalists) would exploit the workers.

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Why This Bubble Economy Keeps Going and Going

The Fed's "bail out" package eases stress in the US credit Market, 2007-2020

Quite a few people may wonder why the global fiat money system has not yet collapsed. The fiat money system did not crash in the financial and economic crisis of 2008/2009, when a great many people feared the debt pyramid would come crashing down.

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The Era of Boom and Bust Isn’t Over

At the 2020 World Economic Forum in Davos, Bob Prince, co-chief investment officer at Bridgewater Associates, attracted attention when he suggested in a news interview that the boom and bust cycle as we have come to know it in the last decades may have ended. This viewpoint may well have been encouraged by the fact that the latest economic upswing (“boom”) has been going for around a decade and that an end is not in sight as suggested by incoming macro- and microeconomic data.

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Hyperinflation, Money Demand, and the Crack-up Boom

In the early 1920s, Ludwig von Mises became a witness to hyperinflation in Austria and Germany — monetary developments that caused irreparable and (in the German case) cataclysmic damage to civilization.
Mises’s policy advice was instrumental in helping to stop hyperinflation in Austria in 1922.

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Why this Boom Could Keep Going Well Beyond 2019

Interest rates down, stock prices up, 1990-2020

The Austrian business cycle theory offers a sound explanation of what happens with the economy if and when the central banks, in close cooperation with commercial banks, create new money balances through credit expansion. Said credit expansion causes the market interest rate to drop below its “natural level,” tempting people to save less and consume more.

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What Will Trump Do About The Central-Bank Cartel?

Euro Banks find it increasingly hard to obtain US dollar credit

The US is by far the biggest economy in the world. Its financial markets — be it equity, bonds or derivatives markets — are the largest and most liquid. The Greenback is the most important transaction currency. Many currencies in the world — be it the euro, the Chinese renminbi, the British pound or the Swiss franc — have actually been built upon the US dollar.

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