Categories » ‘Debt Bubble’
December 2nd, 2013 by olddog
Watch this eleven minute video by FutureMoneyTrends.com
By Mac Slavo
Few economic analysts truly understand the underlying fundamentals of the global economy and their impact on the workings of the world. Fewer still are willing to share that knowledge withthe general public and advise others on how toshield themselves against a destabilization of the system as we have come to know it.
Bud Conrad of Casey Research is one of those who does, and in the interview below with Future Money Trends he discusses the end result of the manipulations currently being executed by our government, central banks, and financial institutions.
Despite what we’ve be told is the case, they have fixed absolutely nothing. Our national debt has grown, millions have already been impoverished and millions more will be soon. The next crisis is imminent.
The complex of potential future problems will be based on the same problems that caused the 2008 downturn… too much government debt, too much private debt and a collapse of that debt when it can’t be paid, creating a new economic crisis.
Look at the big long-term future of our economic situation… I have predicted, that in my lifetime, the US government issue of currency can’t be trusted.
It will implode and will issue a new currency to replace the dollar. That will destroy an awful lot of debts.
It will give the government a new leg, and if they can base it on something like gold it will, both, be very bullish for gold and create new confidence. If they create a new paper system like the old paper system it’ll die just like a Banana republic [like] Argentina about every ten years later.
With that… I am saying in my lifetime we’ll see the demise of the dollar and certainly before that we’ll see gold at $10,000 an ounce.
This critical information for those who want to understand what’s happening behind the scenes and how those schemes will affect the future of our economic and monetary systems:
What’s important to understand is that the manipulation is rampant, as Bud explains in the interview above, and it will soon be revealed in the form of widespread collapse of our economic and financial systems.
Consider the monetary calamity that must occur in order for gold to rise to $10,000 an ounce, and understand that whatever causes such a price spike will be an unprecedented event in human history. It won’t just be gold that’s rising, but any tangible asset essential to survival or the flow of commerce.
Acquire those assets now at a fair price – while you still can.
Any investment you presently have that does not payoff in a hard commodity is shortly going to amount to ZERO, nothing, nada! You may have millions of dollars in the bank, and their only worth a loaf of stale bread. Don’t be ignorant enough to keep your dollar denominated investments any faster than you can convert them to physical gold, silver, or most other physical commodities. If you’re in denial about the dollar crash, you’re a fool. Your financial survival, or death, is only a matter of time, but it’s coming sure as hell. I pity you fools who believe it is disloyal to dump your dollars. Dollars have been nothing but a tool to rob you of your wealth!
November 25th, 2013 by olddog
By Tyler Durden
The Fed's Catch 22 just got catchier. While most attention in the recently released FOMC minutes fell on the return of the taper as a possibility even as soon as December (making the November payrolls report the most important ever, ever, until the next one at least), a less discussed issue was the Fed's comment that it would consider lowering the Interest on Excess Reserves to zero as a means to offset the implied tightening that would result from the reduction in the monthly flow once QE entered its terminal phase (for however briefly before the plunge in the S&P led to the Un-taper). After all, the Fed's policy book goes, if IOER is raised to tighten conditions, easing it to zero, or negative, should offset "tightening financial conditions", right? Wrong. As the FT reports leading US banks have warned the Fed that should it lower IOER, they would be forced to start charging depositors.
In other words, just like Europe is already toying with the idea of NIRP (and has been for over a year, if still mostly in the rhetorical and market rumor phase), so the Fed's IOER cut would also result in a negative rate on deposits which the FT tongue-in-cheekly summarizes "depositors already have to cope with near-zero interest rates, but paying just to leave money in the bank would be highly unusual and unwelcome for companies and households."
If cutting IOER was as much of an easing move as the Fed believes, banks should be delighted – after all, according to the Fed's guidelines it would mean that the return on their investments (recall that all US banks slowly but surely became glorified, TBTF prop trading hedge funds since Glass Steagall was repealed, and why the Volcker Rule implementation is virtually guaranteed to never happen) would increase. And yet, they are not:
Executives at two of the top five US banks said a cut in the 0.25 per cent rate of interest on the $2.4tn in reserves they hold at the Fed would lead them to pass on the cost to depositors.
Banks say they may have to charge because taking in deposits is not free: they have to pay premiums of a few basis points to a US government insurance programme.
“Right now you can at least break even from a revenue perspective,” said one executive, adding that a rate cut by the Fed “would turn it into negative revenue – banks would be disincentivised to take deposits and potentially charge for them”.
Other bankers said that a move to negative rates would not only trim margins but could backfire for banks and the system as a whole, as it would incentivise treasury managers to find higher-yielding, riskier assets.
“It’s not as if we are suddenly going to start lending to [small and medium-sized enterprises],” said one. “There really isn’t the level of demand, so the danger is that banks are pushed into riskier assets to find yield.”
All of the above is BS: lending has never been a concern for the Fed because if it was, then one could scrap QE right now as an absolute faiure. Recall that as we showed recently, the total amount of loans and leases in commercial US banks has been unchanged since Lehman, with the only rise in deposits coming thanks to the fungible liquidity injected by the Fed.
TOTAL DEPOSITS 7.3 TRILLION – LOANS 7.3 TRILLION
TOTAL DEPOSITS 9.5 TRILLION – LOANS 7.3 TRILLION
TOTAL BANK RESERVES 2.2 TRILLION
Furthermore, contrary to what the hypocrite banker said that "the danger is that banks are pushed into riskier assets to find yield”, banks are already in the riskiest assets: just look at what JPM was doing with its hundreds of billions in excess deposits, which originated as Fed reserves on its books – we explained the process of how the Fed's reserves are used to push the market higher most recently in "What Shadow Banking Can Tell Us About The Fed's "Exit-Path" Dead End."
What the real danger is, is that once the Fed lowers IOER and there is a massive outflow of deposits, that banks which have used the excess deposits as initial margin and collateral on marginable securities to chase risk to record highs (as JPM's CIO explicitly and undisputedly did) that there would be an avalanche of selling once the negative rate deposit outflow tsunami hit.
Needless to say, the only offset would be if the proceeds from the deposits outflows were used to invest in stocks instead of staying inert in some mattress or, worse (if only from the Fed's point of view) purchase inert assets like gold or Bitcoin.
Which brings us back to the first sentence and the Fed's now massive Catch 22: on one hand, should the Fed taper, rates will surge and stocks will once again plunge, as they did, in early summer, just to teach the evil, non-appeasing Fed a lesson.
On the other hand, should the Fed cut IOER as a standalone move or concurrently to offset the tapering pain, banks will crush depositors by cutting rates, depositors will pull their money from banks en masse, and banks will have no choice but to close on a record levered $2.2 trillion in margined risk position.
When the banks start charging depositors, watch the Bankers start massive investments in Bitcions, which will be followed by many disgruntled depositors, resulting in a massive price increase in bitcoins. When it’s high enough the bankers will cash out leaving behind massive losses for the remaining bitcoins holders.
By Robert Wenzel
I just spent two hours today with Bitcoin expert Trace Mayer and Vitalik Buterin, head writer atBitcoinMagazine.com, who have been in San Francisco for a couple of days.
It's always a pleasure to talk to Trace, who I consider one of the foremost Bitcoin experts. He bought a ton of bitcoins at 25 cents (and lower). I asked him if he was a billionaire yet, and he just smiled.
During our meeting he outlined the fascinating supply and demand dynamics of Bitcoin. There are currently 12 million bitcoins outstanding but Trace makes the case that the actual number of bitcoins in the float is much smaller.
For example, he believes that most of the bitcoins that the FBI grabbed at the time of Ross Ulbricht's arrest were not bitcoins that belonged to Ulbricht, but were coins that belonged to active buyers and sellers on Silk Road. Thus, these active coins are now in the hands of the FBI and are out of the float.
But more intriguing, Trace tells me he believes that between 3 million to 6 million of bitcoins will never trade again, because they were purchased early on and those who purchased them have forgotten the passwords to gain access to them. Thus, the true Bitcoin float maybe only between 6 million and 9 million bitcoins.
Given the amount of hedge fund money that is now entering the Bitcoin arena (He told me that at a meeting he attended in NYC that a Goldman Sachs analyst was even in attendance studying how GS can get into the Bitcoin game.), Trace believes that Bitcoin is headed to $3,500. A trader friend of mine thinks it will head to $10,000, before it crashes to zero.
I continue to believe that Bitcoin has many of the aspects of a pump and dump scheme and agree with Peter Schiff that it is Tulipmania 2.0, but I don't think the last tulip has been sold.
It is a very risky trade, but there is probably more upside here.
In the EPJ Daily Alert, I will have more details about Bitcoin and what Trace told me about when he plans to start selling and why. It's great timing advice for Bitcoin traders. LET THE BUYER BEWARE!
September 20th, 2013 by olddog
By Dave Hodges
There is a conspiracy being perpetrated against the American people with regard to the true nature of America’s financial situation. To most people, America appears to be on her last economic legs and the future looks hopeless. On the other hand, America has never been wealthier. However, the wealth has been horded and hidden from the American people.
This article exposes why the central bankers and the corporate controlled media are attempting to make it appear as America is dead broke with no hope of recovery. The central bankers, through the government, have indeed hijacked and are hording and hiding substantial assets as they are planning to take the surface economy down as early as this fall/winter. The globalist strategy consists of convincing the people, in advance of the collapse, that there is no hope of economic recovery. Under this scenario, the perpetrators of the collapse will meet with less direct resistance, both in the collapse phase and in the recovery phase in which we will all witness the establishment of a world government and a one world economic system.
Which side is correct? Are we broke or do we have substantial hidden assets? Both sides are correct. The visible economy, which is obvious to all (e.g. the health of the fiat currency, the unemployment rate, national GDP relative to the planet’s GDP), clearly indicates that a collapse is imminent. However, there is also substantial wealth that is being horded on behalf of the banks and corporations by their governmental partners, which could make a significant difference in the health of our economy. The wealth is substantial and has successfully been hidden from most Americans
The Case for a Looming Economic Collapse
The undoing of the America currency has been a century in the making. In 1913, the most evil organization on the earth was created by an unconscionable act of Congress with the creation of the Federal Reserve. The United States national debt is more than 5000 times larger than it was when the Federal Reserve was first created, and this fact has served to turn nearly all of us into debt slaves with each of us vulnerable to the manipulation of the global elite.
The bankers who helped to create the Federal Reserve intended to permanently enslave the U.S. government to a perpetually expanding spiral of debt, and their plan has worked and their final victory is nearly at hand.
Boston University economist Laurence Kotlikoff, stated that the U.S. government is facing a “present value difference between projected future spending and revenue” of 222 trillion dollars in the years ahead. Where are we going to come up with 222 trillion dollars? The short answer is that we won’t under the existing set of economic rules that we are forced to live under.
In 2001, the United States represented 31.8 percent of the world’s economic activity. By the end of 2011, that share had dropped to 21.6% in 2011, which means that America’s portion of the world’s economy is 32% smaller than it was a decade ago and it is declining more with each passing day. With economic indicators such as these, there is no way to climb out of the economic hole we have entered courtesy of the globalist inspired free-trade agreements (i.e. NAFTA, CAFTA and now the MEFTA, AFTA and the TPP). With these kinds of economic indicators, more Americans will be competing for a smaller number of jobs which are significantly declining in pay.
Over one hundred million unemployed Americans are no longer even looking for work. The next time you go into the Department of Motor Vehicles, please realize that you are subsidizing a drivers license for about a third of the people in that building. You are also paying for their health care, food stamps and shelter. And many of these lower class, poverty-stricken “Americans” are living a higher standard of living than you are and this is by design courtesy of Chairman Obama.
It Does Not Pay to Go to Work
Wayne Emmerich found that the family breadwinner who works only one week a month at minimum wage makes 92% as much as the breadwinner grossing $60,000 a year. Emmerich’s stats demonstrate that by working only one week a month one can save a lot of money in child care expense. But topping the list is Medicaid, which is accessible to minimum wage earners and the program has very low deductibles and co-pays. In short, by working only one week a month at a minimum wage job, a minimum wage earner is able to get total medical coverage for next to nothing courtesy of you and me.
The middle class is not as lucky as the $60,000 breadwinner pays out approximately $12,000 per year in health insurance costs with an addition $4,500 in co-pays. And if anyone in the part-time minimum wage earning family is disabled, SSI pays out an additional $8,088 per year. When one begins to calculate the expenses incurred by a typical breadwinner making $60,000 per year, compared to the part time minimum wage worker, coupled with minimum wage earners tax supported federal bailouts for these freeloaders, the poor have more discretionary income than those who pay the taxes that run the country. And if the part time minimum wage worker is willing to cheat and participate in the underground economy, they will have significantly more discretionary income than their hard-working $60,000 per year counterpart who actually works for a living. In short, if you are a full-time employee making above minimum wage, you are paying for your own economic demise. The numbers here suggest that we’d be better off staying home and living off of the labors of what’s left of the middle class and of course this would help to collapse the economy.
Unbearable Taxes Are Leading to Record Expatriation Rates
Overwhelmingly, the number one reason that Americans are fleeing the country is because of high taxes. The income tax rate rose this year to 39.6% from 35% for individuals earning more than $400,000 a year and married couples earning more than $450,000. As of this year, 77% of Americans will pay higher federal tax rates because the cuts in Social Security payroll taxes expired when Congress passed its tax package on New Year’s Day. The Tax Policy Center estimates that those who earn more than $1 million would pay an average of $170,341 more in taxes. The tax burden is adding crushing weight to a beleaguered upper and middle class America.
Hiding and Hording Massive Assets That Could Rescue the Country’s Economy
Americans are lamenting the fact that our budget deficit is now over $17 trillion dollars. Our national debt and deficit is a drop in the bucket compared to the assets that our government controls. However, far beneath the ground, the federal government owns the rights to mineral and energy leases, from which they receive royalties, rents, and bonus payment, states the Institute for Energy Research, an industry group. According to their estimates, government states that the assets are worth $128 trillion. That’s almost eight times the national debt. This is a hard asset which could be collateralized and matched against the deficit.
“These resources could be leased to third parties and could subsequently earn the state and national government huge royalties, rents, and bonus payments that it is estimated could total almost $150 billion over 10 years, just for the oil and gas leases alone.” Then why isn’t this being done? Simple, ask yourself who would lose money if these idle assets were to brought to fruition? The oil companies would lose money, that’s who! The same oil companies that block oil drilling on the North Shore of Alaska. The same oil companies who preserve the existing relationship with Middle Eastern nations, which someday, will pull us into a devastating world war with Syria and Iran.
Further, the unleashing of these assets would reduce the costs of energy for consumers and businesses. Now, the owners of the utilities, the same people who are the owners of the oil companies, could not permit that. The utilities have invested billions toward the installation of smart meters and a new infrastructure smart grid, in which they control all energy pricing.
Another factor that comes into play on why these assets are not being unleashed is because plentiful, reliable and cheap energy supplies would greatly accelerate economic growth and jump start the economy out of the doldrums. But when the globalists’ goal is the creation of a one world economic system, based upon keeping nations in debt, controlled by a tyrannical one world government, the old government and economy must be brought down and this economic boon to the economy cannot be allowed to transpire. Therefore, the government acts as a procurement agent for the globalists, who will eventually unleash these assets to themselves, after the collapse of the dollar.
CAFR’S the Source of Untold Wealth
For over a decade, accountant Walter Burien, has been trying to raise public consciousness over what he says is a massive conspiracy, totaling trillions of dollars. The conspiracy, Burien says, is one in which governments at all levels have hidden away funds in a practice commonly called CAFR’s. Burien’s numbers may be questioned, but there can be no doubt that significant hidden funds clearly exist. The existence of CAFR’s are evidenced by the existence of the Comprehensive Annual Financial Reports (CAFRs). CAFR’s are a required aspect of every government agency accounting practices. Therefore, the existence of this underground slush fund is a matter of public record.
The subject of CAFR’s first came to light when Colonel Gerald Klatt alerted Burien to their existence. Coincidentally, Klatt died under very mysterious circumstances, in 2004, which lent credence to the claim that there was a conspiracy to cover up the scope and true nature of CAFR’s. Just what is a CAFR and how does it explain how the American are being lied to about how much money truly exists within the control of the government?
To help you understand the nature and process of CAFR’s, let’s pretend that you were to have a checking account with $100 and a savings account with $1,000 in two different banks. Let’s further imagine that you only reported to the IRS, that you only had $100 dollars as your net worth because you don’t want to use your savings account to pay bills (i.e. taxpayer obligations). Subsequently, you’d be audited and put in a federal prison for failure to report the larger amount. However, the government grants itself permission to play by its own rules and to make up the CAFR rules as they go along. The government, as described in the above example, simply designates that it has two accounts (i.e. the $100 account and the $1,000 (CAFR) savings account). However, the larger CAFR account is designated as “non-governmental” or “non-taxpayer” income and this allows the government to hide all of this wealth from the people as reported in the government’s Budget Report. In this economic scenario, only the smaller account is the one that gets declared. And the reason that governments continue to engage in this shady practice, is that they want to be able to justify the taking of a greater portion of your income through increased taxation. I call this highway robbery. As an aside, have you noticed that many counties are building monumental justice centers which defy description of where the funds came from given the present state of economic affairs. These centers are being built with CAFR’s which are monetized in a variety of ways.
The subject of CAFR’s is something that has come into my life with an explosion. In Maricopa County (greater Phoenix area), former county attorney, Andrew Thomas, was disbarred eighteen months ago. A three-member panel found that former County Attorney Andrew Thomas violated the professional rules of conduct for lawyers in bringing criminal charges against two county officials and a judge in December 2009. What gets lost in the media reporting of Thomas sudden departure from office and his disbarment is why Thomas was prosecuting two county officials, County Supervisors Dan Stapely and Mary Rose Wilcox as well as Superior Court Judge Gary Donahoe. Thomas initiated the investigation with allegations of financial wrong doing on the part of the three individuals. The second phase of his investigation was to attack the use of off the books funds (i.e. CAFR’s).Thomas was gone from office before phase two of his legal action could be commenced and Arpaio was neutralized.
A few years ago, Maricopa County just completed the building of an expensive justice center worth more than 500 million dollars. Where did the money come from as it has repeatedly been reported in the Phoenix media that the County is broke? Who benefitted? Thomas found evidence of money being kept off of the books and was attempting to expose it and the forces of the establishment had him expelled from office and disbarred within months of the first accusations. Simultaneously, Sheriff Joe Arpaio was complicit in the ill-fated Thomas investigation by carrying out the investigation and participating in the arrests of the three officials. Shortly thereafter, Arpaio was the source of a massive Eric Holder led justice probe into his department’s alleged racial profiling of illegal immigrants in Maricopa County. Arpaio brilliantly retaliated with an investigation into the authenticity of Obama’s long form birth certificate. Obama was declared, by Arpaio, to be ineligible to appear on Arizona’s ballot for President in 2012. Then the controversy went dark and the back and forth between the Feds and Arpaio disappeared from the front page of the newspapers. Obama eventually appeared on the ballot and Arpaio received a mere slap on the wrist from the Department of Justice. Can anyone say “a deal was struck?” Apraio survived because he had leverage against Obama and Andrew Thomas did not and subsequently, Thomas’ license to practice law was revoked by a three judge panel, which operated in the spirit of the worst of any kind of Kangaroo court.
If the Thomas case had been fully exposed to the media, the subject of CAFR’s would have been irrevocably exposed. The obfuscation of public funds issue appeared to be dead. However, I had an inside source come forward and his name is Doug Rhoads. Doug is a former Maricopa County prosecutor. He approached me in early June of 2013 after reading a multipart series that I had published on my website regarding the privatization of for profit prisons and the fact that many states were promising private corporations a 90% prison occupancy rate, thus driving up zealousness of criminal prosecutions aimed at keeping the prisons full and profits high.
Doug Rhoads informed me that everyone of these criminal cases were being monetized as a traded commodity on the market and that the earned money went off of the books. Doug subsequently appeared on my talk show for two hours and exposed the fact that this was indeed taking place and we also discussed the Andrew Thomas affair. Since the airing of this interview with Rhoads, I have been personally threatened on two occasions that if I continued to report on prison privatization and the Rhoads revelations of hidden public assets, there would be “grave consequences.” Also, since the Rhoads interview, I have been contacted by several people, each with a different angle on this situation. However, all of them are afraid for their careers and their lives if their whistle-blowing were to ever be exposed.
The issue and existence of CAFR’s is being zealously guarded. The release of CAFR’s, alone, could erase our national debt and return financial affluence to America. For example, California Governor Brown, claims that the California’s state budget deficit of $16 billion requires austerity actions. However the state’s CAFR funds revealed $600 billion in undeclared assets. When all the CAFR surplus accounts are totaled, Californians have been overtaxed by $8 trillion dollars in a sampled study. This is being done at every level of government, two sets of books and two sets of figures. You do not have to be living in California and Arizona to be the victim of this deception, it is in every state. This makes the national debt appear to be meaningless.
And whatever happened to Col. Klatt, the man who first revealed the existence of the CAFR’s? He suffered a worse fate than Andrew Thomas, he was likely murdered as Klatt served for a long time as an Air Force auditor and federal accountant, and it’s likely that he got too close to some military CAFR’s being used for “off the books” operations and he died under very mysterious circumstances. Google “Walter Burien” and be prepared to get really upset about how much money is being withheld by government in this unholy accounting practice.
What Does It All Mean?
Through CAFR’s, the government is clearly hording money. Where does the money go? Nobody can be certain except that it makes the lion’s share of money collected eligible to be used as off the books spending.
This is where the plot thickens and things get very interesting. If the economy is collapsed due to the well-publicized debt listed in the first part of this article, it is not known what would happen to the CAFR’s, the underground mineral resources, etc. Since these assets are technically off the books and under the control of local governments and many of their corporate NGO’s, they would presumably be unaffected in an economic collapse scenario. And wouldn’t that be the goal of banking interests who would want to collapse the economy in that they would want to procure as many hard assets as possible before the collapse. Since government at all levels has repeatedly proven itself to be agents of the megabanks and the corporations, these institutions would survive an economic collapse with a great deal of hard assets.
I have concluded that the powers that be are hording hard assets as a means to maintain power following the economic reorganization which would follow a collapse. Further, this theory is further bolstered by the fact that Federal Reserve continues to buy $40 billion of mortgage backed securities every month and MERS is continuing their theft of home mortgages at record rates. This scenario looks like the globalists are following a massive wealth transfer scenario and the pace of this wealth transfer is accelerating. What is the rush? Could it be that what I wrote about two weeks ago is indeed coming into play?
The GRID EX II drill in which the power grid is being “taken down in a simulation,” is something that cannot be easily dismissed as the next false flag event. However, this is eerily similar to what happened in 9/11 and the 7/7 bombings as well as the Boston Marathon bombing in which a drill culminated in a false flag attack. If the grid is taken down, and as I have stated before, a false flag within a false flag can be executed and the banks can be collapsed and the country will barely notice. Who would notice the missing digits in their bank accounts when the grid is down and the people are starving by the third day following the blackout? Meanwhile, government as well as their banking and corporate partners would hold most of the hard assets in the country following an economic collapse and would stand to be in a position of extreme power when the smoke eventually clears.
In this scenario, the largest remaining asset that the banks would not totally control would be the privately owned homes and businesses. But after a collapse, how would people pay their mortgage? The short answer is that they could not. And who would the deeds revert to? They would revert to the banks.
Although I think this scenario is likely, this is only a theory regarding the tie in with GRID EX II, hidden wealth and collusion to collapse the economy in order to transfer wealth and to consolidate holdings. However, what is not a theory is the fact that our hidden assets outnumbers the sum total of our debt as a nation and the debt and the deficit could be paid off overnight should the people wake up and force the government to release the true wealth of the country.
September 20th, 2013 by olddog
By Ron Holland
This may directly impact how you invest or rebalance your portfolio, view or engage in politics, and how you will attempt to secure your wealth in the future.
I believe this will dramatically impact the dollar, gold and bonds. In addition, it may well create the biggest bull market in decades for several equity sectors while the rest of the market stagnates and withers away into oblivion.
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You also know that The Daily Bell abruptly ceased publication without notice or warning on July 16, 2013 (see Anthony Wile's "Hasta La Vista").
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July 31st, 2013 by olddog
By Matt Winkeljohn
What was once a great country has turned in to a maggot infested, unrecognizable carcass of its former self.
There was once a number of people who seceded and revolted against a tyrannical British government. Those same people had a great vision of what would become The United States of America.
Those great founders made it explicitly clear to all people and future governments as to how America is supposed to be. They even drafted documents to explain that the government is intended to be small and that the people have basic human rights that shall not be infringed upon.
Unfortunately, it has taken only a little less than 250 years to completely destroy that vision and the country.
“A private central bank issuing the public currency is a greater menace to the liberties of the people than a standing army.” We must not let our rulers load us with perpetual debt.”
The Federal Reserve, which is not federal at all, is a privately owned banking cartel that has been given power from the United States federal government, to print our paper money and divvy it out, with no oversight, as they deem necessary.
That is not the only thing the Federal Reserve does…They also create debt.
The debt is created by printing money without any backing by gold or silver and then placing debt on to each dollar printed. This debt, that is impossible to be payed back, is then passed on to the people of America. Through the use of banks, that debt is then held over Americans heads in order to force them to pay unlawful taxes and to work for “the system.”
The Federal Reserve is one of the largest contributing factors to most economic declines in the United States.
One would think, with a national debt that is nearing $17 trillion, people would start to wake up. I am positive that our founders wouldn’t have put up with this sort of madness. They did, however, try to warn us.
“They who can give up essential liberty to obtain a little temporary safety, deserve neither liberty nor safety.”
In 2010, there were 40,627 new laws put on the books across the United States. In 2012, 40,000. These are all laws telling We The People what we can and can not do. There are over 30,000 pages of just federal laws currently on the books. Most of which are victimless crimes put in to law for the sole purpose of revenue and control.
Who are hired to enforce these laws?
There are a number of agencies that have been established to enforce these laws, most of which do not have the interest of the people in mind, but the interest of the government and corporations.
Of these agencies, the city police, Sheriffs department and State Highway Patrol are the most commonly seen. The city police and State Patrol have essentially become no more than common street thugs. Their job is nothing more than revenue enforcement through the use of bully tactics and fear. While the Sheriffs departments are not without flaws, they are the only “police” in the entire country that is actually voted in by the people.
There has also been a recent trend of militarizing police forces. Parents can no longer teach their children that if they are in trouble, to go find the nearest person in uniform. If a screaming child is charging at today’s police, they are more likely to get shot than they are to get help. The police of today have become the judge, jury and many times, the executioner. People are 8 times more likely to get killed by a cop than they are by any terrorist.
The Transportation Security Administration (TSA) and the Department of Homeland Security (DHS) are two more agencies that have been created to keep Americans in check.
The duty of these two agencies are not so much about revenue as they are about keeping Americans compliant. The Obama and Bush administrations have used these agencies as their own personal gestapo against Americans, all in the name of fake terror threats. We are told that there are evil terrorists that could strike at any time, so the majority of Americans are now willing to give up most of their basic human rights for the illusion of protection.
The reality of these two agencies is that they are here to keep the people afraid, compliant and unwilling to stand up against the government. It is their sole purpose to detain and execute if necessary, any American that is not willing to obey the fake authority of them or the government.
“The two enemies of the people are criminals and government, so let us tie the second down with the chains of the Constitution so the second will not become the legalized.”
~ Thomas Jefferson
“The policy of the American government is to leave their citizens free, neither restraining nor aiding them in their pursuits”
~ Thomas Jefferson
Who is at the top of the heap when it comes to the destruction of this once great country? Well, that has a dual answer.
First.. government. This over reaching and illegal federal government that we have are the ones who put all of the tyranny in motion. It was/is a greedy government that protects the Federal Reserve, it is the federal government that illegally justifies unwarranted NSA spying on all Americans and it is the federal government that has left you for dead.
It is the federal government (Democrats and Republicans alike) that allow the Patriot act, which unlike the name, isn’t very patriotic. The Patriot act is designed to allow the federal government to keep tabs on every American alive today. It is the basis for the National Security Agency’s (NSA) spying, wiretapping and listening to every phone call, text and email. This has destroyed the entire 4th amendment to the constitution.
“The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.”
It is the federal government that has been pushing to completely disarm the American people in order to be able to better control us. Much of this has been done through laws and legislation that We The People never had a say in. This goes directly against the 2nd amendment to the constitution.
A well regulated Militia, being necessary to the security of a free State, the right of the people to keep and bear Arms, shall not be infringed.
It is the federal government that not only allowed, but demanded that We The People not be allowed to protest. HR 347 essentially allows the government to take away your 1st amendment right, anywhere they choose that is shouldn’t apply. In fact, this and every other right that we have is not up for negotiation. It is not the right or the duty of the federal government to put ANY infringements on ANY of our rights, or to legislate when and where they apply.
“Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.”
Every part of this amendment has been destroyed!
The last three examples that I have given also goes directly against the 5th and 10th amendments.
“No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a Grand Jury, except in cases arising in the land or naval forces, or in the Militia, when in actual service in time of War or public danger; nor shall any person be subject for the same offence to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.”
“The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.”
I did say that this was a dual answer, didn’t I? Here is part two of the answer.
Who else is at the top of the heap to blame for the destruction of this once great country?
If you want to know who really let all of this happen, look no further than the nearest mirror. The founders of this country were very specific in saying that it is the people’s duty to keep government in check.
“What country can preserve its liberties if its rulers are not warned from time to time that their people preserve the spirit of resistance?”
~ Thomas Jefferson
You have become weak and compliant to tyranny! You have let down the founders who once had a great vision for this country!
The Declaration of Independence states – “That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.”
You have not done that! You have set idly by while government divides us and destroys something that was once beautiful, majestic, rich and great! It is your job to make sure that government doesn’t get too big, that America didn’t create their own enemies and that the constitution would always be followed..but you failed!
“The strongest reason for the people to retain the right to keep and bear arms is, as a last resort, to protect themselves against tyranny in government.”
~ Thomas Jefferson
“When the people fear their government, there is tyranny; when the government fears the people, there is liberty.”
~ Thomas Jefferson
Now is the time to wake up! Now is the time to protect ourselves against the government and all of its agencies!
NOW IS THE TIME TO MAKE THEM AFRAID OF US!!!!
July 11th, 2013 by olddog
More and more people and organizations are becoming adept at identifying the evil injustices which have invaded every facet of our lives. Of all the identified enemies of humanity, there is one enemy which stands out among all others.
Pogo is correct. It is we the people who have become adept at mastering the craft of perpetuating our own enslavement. We provide the labor and the capital which enslaves us. This article illustrates one small example of how we are being enslaved and more importantly, what we can do about it.
Whether it is banking, healthcare or even public education, the globalists have virtual control over the entire system. They also control the dialogue through their domination of the mainstream media and they do so to their advantage and to our extreme detriment.
This article will take a very brief look at banking, and then propose solutions based upon common sense and from the field of psychology which could be used to mitigate the effectiveness of the globalists on a broad front in this arena.
Stop Feeding the Beast
The globalists have a definitive infrastructure and when we decide enough is enough and withdraw from this system, their house of cards will begin to crumble and could eventually collapse. The moment humanity realizes that we are contributing to our own enslavement and demise by our complicit participation in the globalists' rigged game, we can choose to alter our course by making different decisions. Our continuing decision to fully participate in the banking system is mind boggling because this system is sowing the seeds of humanity’s destruction.
First, it incomprehensible that people do not take the time to investigate with whom they are entrusting their money. The money changers represent the group most despised by Jesus; and if that is not enough, let us consider the fact these banksters contribute to the starting of every war in order to loan out the money for the arms build-up. And then the banksters loan out the money to clean up the mess and we repeat this scenario over and over and over again. To survive, the system needs your children’s involuntary servitude in the military. In other words, when you deposit money in the bank, you are participating in the future death of many of today’s children as they grow into young adulthood. Why would any reasonable person entrust their money to such a system of evil?
Second, the banksters take your money into their hallowed institutions and then multiply it by a factor of nine (i.e. fractional reserve banking) and then loan out this imaginary money at your expense by the inflationary practice that this culminates in. Then the banksters have the intestinal fortitude to loan us back the money at 15, 20, 25% interest on money created out of thin air. When you put money into the bank, you are committing financial suicide.
Third, when the banksters print their money out of thin air and then charge the government and the people for the right to use “their” money, we in effect are paying for the right to be their debt slaves. And all of this occurs despite the fact that the Constitution says that Congress shall coin money. Of course, a dumbed down populace cannot appreciate or be cognizant of the principles of the Constitution. Why? Because the globalists also control education which is another story for another time.
Fourth, the international banksters are hands down the most corrupt and evil influence on the planet. They perpetrated the Arab Spring in which many have died, and there is no end in sight.
The banksters, through the Bilderberg control over NATO, overthrew Libya because that country would not join the Bank of International Settlement’s central banking system and enslave their people into generations of crushing debt. Immediately prior to the time of Libya’s occupation, the Libyan people paid 14 cents for a gallon of gas, provided free education to their citizens as well as free health care. Young Libyan couples getting married were given a home. The banksters could not have that kind of wealth wasted on common people, because unless someone is a debt slave, they cannot be readily controlled.
Today, every one of the five megabanks are stealing the homes of their customers through the MERS fraud. The banks also launder money for the drug cartels (e.g. HSBC Bank and Wachovia Wells Fargo). They profit from child sex rings and they are using your bank deposits as a force multiplier to accomplish these evil deeds. Whether we want to face these facts or not, everyone who keeps their money in these institutions is an accomplice to these crimes.
We need to collectively come to realize that we the people are playing in a rigged game and we desperately need to cash out and find a new game to play. And it is just not banking that we need to be worrying about. The globalists control the very foundations of civilization. However, at the heart of this control is banking and that is where our attack needs to begin. Yet, I know that it seems impossible for most of us to not play in the globalist game of domination because so much of our lives are wrapped up in these evil institutions. So what is a victim to do?
The answer to the above question may have its roots in the field of psychology. Through institutions such Royal Institute of International Affairs and the Tavistock Institute, which controls over 30 research and polling sites in America. Tavistock is well known for the science of creating phony polls to influence and alter the public’s perception of an event based upon group think principles. More importantly, Tavistock has been at the forefront of psychological research on the manipulation of the masses. The psychological research of Tavistock helps us to understand how so few on this planet can so completely control so many. The effectiveness of their developed psychological controls are so complete, that the masses have largely been reduced to a herd of mindless sheep in which the many are conditioned to embrace and rejoice in their slavery.
What is good for the goose is also good for the gander. We, as a people, have the same opportunity to use the same psychological principles against the banksters. There are literally dozens of psychological strategies which we as the common people could employ. In the remaining part of the article, two strategies will be discussed and if they were employed by the masses, we would see an immediate impact on the control level of the globalists.
The Hawthorne Effect
Since the discovery of the Hawthorne Effect by the Harvard School of Business, it was discovered that research subjects change their behavior when they realize that they are being watched. Today, this is a well-known principle in the arena of effective research in which researchers are trained to minimize their level of intrusiveness in their naturalistic field research.
Based upon this principle, and if I were a globalist, I would welcome the public revelations of the NSA spy scandal for all the apparent reasons listed above. How many of us will be prevented from speaking out as things continue to decline for fear of future retribution? Fortunately, we live in a universe of duality and, therefore, this same principle can be also be used against the globalists as well.
What happens when you shine a light on rats? Everybody knows that the rats run for cover. This knowledge should be an empowering motivator for the alternative media. This knowledge should also encourage all of us to become a citizen journalist. Being a citizen journalist whistleblower needs to become our national pastime in which we report every act of wrongdoing on the part of every corporation and every government official, whether their rank is high or low.
To be effective and to create our own cultural norms, the alternative media needs to exalt people like Ed Snowden and immortalize the memories of Michael Hastings and Andrew Breitbart. There needs to become so many of us, that the globalists need to feel that there is nowhere to hide.
An Army of Citizen Journalists
America, if you want to preserve what little freedom you have left, you have a duty to become a participant in the resistance against global tyranny. Our collective efforts could someday be sufficient in numbers to shift the consciousness of this planet and create counter-critical mass in which a tsunami of opposition beliefs to the prevailing status quo sweeps across the planet and removes much of the control the banksters enjoy today.
In a person’s role as a citizen journalist, the coverage can seem minuscule on the surface. Perhaps the event one can cover may be as mundane as children cited for drawing with chalk on the sidewalk or a 10-year-old girl ticketed for operating a lemonade stand without a license. Together, we can create a debris field which can impede and eventually turn back the progress of the globalists. No, I do not think we can eliminate the influence the money changers, but we can invoke change by utilizing the principle of the Hawthorne Effect. And if there was one thing that I could have personal influence over, I would encourage all of you to educate your neighbors and friends about fractional reserve banking. I know of nobody, who understands this principle, who agrees with it. Fractional reserve banking could be the beginning point for any discussion about the unwarranted globalist control over humanity (i.e. “Do you know what happens to your money when you deposit it in the bank?”).
What To Do About the Banks?
You work at your job, your employer sends your check to your bank and you make automated payments for your bills from your bank account and you do not have to lift a finger to make all of this happen once your sign the banks paperwork. If you are like me, you can go months without having to withdraw any cash from the bank because the bank, on our behalf, controls most of our financial obligations if we so permit. Our lives are so intertwined in these corrupt financial institutions, it is not practical to totally extricate ourselves from the banks in one decisive action. However, we can systematically starve the banks to death through the gradual withdrawal of our support and our money.
Is it possible for you to withdraw enough of your money to equal over 90% of your total holdings in the bank? On the surface, this would appear to be an impractical solution. The concept of fractional reserve banking has built in a very effective firewall to real globalist profits through the multiplication of your deposits by 900%. For even if we were to collectively withdraw 80% of our money from the banks, the globalists would still double their profits based upon this concept. If Ron Paul in his former role on the House Banking Committee could not even audit the Federal Reserve, it is safe to say that, for now, the tinkering of this system is nearly impossible. However, this is where the idea of financial guerrilla warfare comes into play.
Attacking the Banksters On Our Terms
The most important decision we make is whether we believe we live in a friendly or hostile universe. — Albert Einstein
Is your glass half empty or half full? We make the choice to become optimistic or pessimistic. Voluminous amounts of psychological research is replete with the established fact that optimists live longer, make more money, have happier marriages and enjoy many more social advantages than do pessimists. Our happiness, our success and our well-being largely boils down to our own choices. Freedom is the space between the prison bars of life. When we realize that even in the most dire of situations, we have some measure of freedom, we can initiate change. And when many people realize this fact, we can initiate change on a global scale.
If we come to view the evil monolithic organizations such as the IRS and the Federal Reserve as insurmountable foes with no weaknesses to exploit on our end, then our pessimism will rule the day and we will capitulate to this criminal system just the like a herd of sheep.
When you change the way that you look at things, the things you look at change.
The alternative media is excellent at identifying and exposing problems. However, if all we do talk, then our revelations begin to become irrelevant. When all we do is to call attention to the negativity, then we invite more negativity into our paradigm. Our glass will always be half empty. And now it is time to discuss the second psychological principle that we can employ against the globalists.
Some psychologists call the following attractor energy in that we invite into our lives the things that we pay the most attention to. And what we invite into our lives attracts more of what it is that we are paying attention to. If we only focus on the problems, then we will invite more problems. Therefore, it is incumbent upon all of us to focus mostly on changes that are needed. Thus, significant action must follow our observations and words. You will eventually become what you think
As a man thinks in his heart, so is he. — Proverbs 3:27
First, we must visualize being out of the corporate dominated system of the globalists. Ask yourself, what would that look like and then work to make it happen.
With regard to beginning to withdraw from the central banking system, people should not use direct deposit from their employer to the bank. Keep a minimal amount of cash in the bank so that you may cash your checks. Pay your mortgages with a money order. Do the same for your car loans. Better yet, do not make purchases that you cannot afford to pay cash for. Debt makes you a slave to the banksters.
Pay cash for as much as you can and limit the amount of cash that you let go into the bank. Remember, for every dollar that goes into the bank, the globalists multiply it times nine, and much of that money goes toward programs designed to maximize their control over us.
Shop at your local merchants. Avoid corporate chain stores, owned by the megabanks, like the plague. Regularly, hold and/or attend garage sales, swap meets and farmers' markets to find what you need. Learn to grow your own food and subsist on that food supply as much as possible. You get the idea, get out of their money system as much as possible and we will significantly weaken the money changers system. We are not going to be able to invade Wall Street, so we have attack it from the inside. This is financial guerrilla warfare.
There is also a side benefit to these withdrawal strategies. When the collapse of the dollar finally arrives, you will be better prepared to survive. It is time to roll up our sleeves and work towards getting out of this corrupt system.
Do not conform to the pattern of this world… — Romans 12:2
Dave is an award winning psychology, statistics and research professor, a college basketball coach, a mental health counselor, a political activist and writer who has published dozens of editorials and articles in several publications such as Freedoms Phoenix, News With Views and The Arizona Republic.
The Common Sense Show features a wide variety of important topics that range from the loss of constitutional liberties, to the subsequent implementation of a police state under world governance, to exploring the limits of human potential. The primary purpose of The Common Sense Show is to provide Americans with the tools necessary to reclaim both our individual and national sovereignty.
June 28th, 2013 by olddog
How can anyone not see that the U.S. economy is collapsing all around us? It just astounds me when people try to tell me that "everything is just fine" and that "things are getting better" in America. Are there people out there that are really that blind? If you want to see the economic collapse, just open up your eyes and look around you. By almost every economic and financial measure, the U.S. economy has been steadily declining for many years. But most Americans are so tied into "the matrix" that they can only understand the cheerful propaganda that is endlessly being spoon-fed to them by the mainstream media. As I have said so many times, the economic collapse is not a single event. The economic collapse has been happening, it is is happening right now, and it will continue to happen. Yes, there will be times when our decline will be punctuated by moments of great crisis, but that will be the exception rather than the rule. A lot of people that write about "the economic collapse" hype it up as if it will be some huge "event" that will happen very rapidly and then once it is all over we will rebuild. Unfortunately, that is not how the real world works. We are living in the greatest debt bubble in the history of the world, and once it completely bursts there will be no going back to how things were before. Right now, we are living in a "credit card economy". As long as we can keep borrowing more money, most people think that things are just fine. But anyone that has lived on credit cards knows that eventually there comes a point when the game is over, and we are rapidly approaching that point as a nation.
Have you ever been there? Have you ever desperately hoped that you could just get one more credit card or one more loan so that you could keep things going?
At first, living on credit can be a lot of fun. You can live a much higher standard of living than you otherwise would be able to.
But inevitably a day of reckoning comes.
If the federal government and the American people were forced at this moment to live within their means, the U.S. economy would immediately plunge into a depression.
That is a 100% rock solid guarantee.
But our politicians and the mainstream media continue to perpetuate the fiction that we can live in this credit card economic fantasy land indefinitely.
And most Americans could not care less about the future. As long as "things are good" today, they don't really think much about what the future will hold.
As a result of our very foolish short-term thinking, we have now run up a national debt of 16.4 trillion dollars. It is the largest debt in the history of the world, and it has gottenmore than 23 times larger since Jimmy Carter first entered the White House.
The chart that you see below is a recipe for national financial suicide…
Of course things have accelerated over the past four years. Since Barack Obama entered the White House, the U.S. government has run a budget deficit of well over a trillion dollarsevery single year, and we have stolen more than 100 million dollars from our children and our grandchildren every single hour of every single day.
It is the biggest theft of all time. What we are doing to our children and our grandchildren is beyond criminal.
And now our debt is at a level that most economists would consider terminal. When Barack Obama first entered the White House, the U.S. debt to GDP ratio was under 70 percent. Today, it is up to 103 percent.
We are officially in "the danger zone".
If things really were "getting better" in America, we would not need to borrow so much money.
Our politicians are stealing from the future in order to make the present look better. During Obama's first term, the federal government accumulated more debt than it did under the first 42 U.S presidents combined.
That is utter insanity!
If you started paying off just the new debtthat the U.S. has accumulated during the Obama administration at the rate of one dollar per second, it would take more than 184,000 years to pay it off.
So what is the solution?
Get ready to laugh.
The most prominent economic journalist in the entire country, Paul Krugman of the New York Times, recently suggested the following in an article that he wrote entitled "Kick That Can"…
Realistically, we’re not going to resolve our long-run fiscal issues any time soon, which is O.K. — not ideal, but nothing terrible will happen if we don’t fix everything this year. Meanwhile, we face the imminent threat of severe economic damage from short-term spending cuts.
So we should avoid that damage by kicking the can down the road. It’s the responsible thing to do.
You mean that we might actually do damage to the debt-fueled economic fantasy world that we are living in if we stopped stealing so much money from future generations?
Oh the humanity!
It is horrifying to think that all that one of the "top economic minds" in America can come up with is to "kick the can" down the road some more.
Unfortunately, neither Paul Krugman nor most of the American people understand that our financial system is actually designed to create government debt.
The bankers that helped create the Federal Reserve intended to permanently enslave the U.S. government to a perpetually expanding spiral of debt, and their plans worked.
At this point, the U.S. national debt is more than 5000 times larger than it was when theFederal Reserve was first created.
So why don't the American people understand what the Federal Reserve system is doing to us?
It is because most of them are still plugged into the matrix. A Zero Hedge article that I came across today put it beautifully…
US society in a nutshell: Chris Dorner has been around for a week and has 222 million results on Google; the Federal Reserve has been around for one hundred years and has 187 million results.
If nothing is done about our exploding debt, it is only a matter of time before we reach financial oblivion.
According to Boston University economist Laurence Kotlikoff, the U.S. government is facing a "present value difference between projected future spending and revenue" of222 trillion dollars in the years ahead.
So how in the world are we going to come up with an extra 222 trillion dollars?
But it is not just the U.S. government that is drowning in debt.
Just check out this chart which shows the astounding growth of state and local government debt in recent years…
All over the United States there are state and local governments that are on the verge of bankruptcy. Just check out what is going on inDetroit. The only way that most of our state and local governments can keep going at this point is to also "kick the can" down the road some more.
And of course most of the rest of us are drowning in debt as well.
40 years ago, the total amount of debt in the U.S. economic system (government + business + consumer) was less than 2 trillion dollars.
Today, the total amount of debt in the U.S. economic system has grown to more than 55 trillion dollars.
Can anyone say bubble?
The good news is that U.S. GDP is now more than 12 times larger than it was 40 years ago.
The bad news is that the total amount of debt in our financial system is now more than 30 times larger than it was 40 years ago…
At the same time that we are going into so much debt, our ability to produce wealth continues to decline.
According to the World Bank, U.S. GDP accounted for 31.8 percent of all global economic activity in 2001. That number dropped to 21.6 percent in 2011. That is not just a decline – that is a nightmarish freefall. Just check out the chart in this article.
We are becoming less competitive as a nation with each passing year. In fact, the U.S. has fallen in the global economic competitiveness rankings compiled by the World Economic Forum for four years in a row.
Most Americans don't understand this, but the United States buys far more from the rest of the world than they buy from us each year. In 2012, we had a trade deficit of more than 500 billion dollars with the rest of the world.
That means that more than 500 billion dollars that could have gone to U.S. workers and U.S. businesses went out of the country instead.
So how does our country survive if hundreds of billions of dollars more is flowing out of the country than is flowing into it?
Well, to make up the shortfall we go to the countries that we sent our money to and we beg them to lend it back to us. If that doesn't work, we just print and borrow even more money.
Overall, the United States has run a trade deficit of more than 8 trillion dollars with the rest of the world since 1975.
That is 8 trillion dollars that could have saved U.S. businesses, paid the salaries of U.S. workers and that would have helped fund government.
But instead, our foolish policies have greatly enriched China and the oil barons of the Middle East.
Sadly, politicians from both political partiescontinue to boldly support the one world economic agenda of the global elite.
Just consider how destructive many of these "free trade" deals have been to our economy…
When NAFTA was pushed through Congress in 1993, the United States had a trade surpluswith Mexico of 1.6 billion dollars.
By 2010, we had a trade deficit with Mexico of 61.6 billion dollars.
Back in 1985, our trade deficit with China was approximately 6 million dollars (million with a little "m") for the entire year.
In 2012, our trade deficit with China was 315billion dollars. That was the largest trade deficit that one nation has had with another nation in the history of the world.
In particular, our trade with China is extremely unbalanced. Today, U.S. consumers spendapproximately 4 dollars on goods and services from China for every one dollar that Chinese consumers spend on goods and services from the United States.
But isn't getting cheap stuff from China good?
No, because it costs us good paying jobs.
According to the Economic Policy Institute, the United States is losing half a million jobs to China every single year.
Overall, more than 56,000 manufacturing facilities in the United States have been shut down since 2001. During 2010, manufacturing facilities in the United States were shutting down at a rate of 23 per day. How can anyone say that "things are getting better" when our economic infrastructure is beingabsolutely gutted?
The truth is that there are never going to be enough jobs in America ever again, because millions of our jobs are being sent overseas and millions of our jobs are being lost to technology.
You won't hear this on the news, but the percentage of the civilian labor force in the United States that is employed has been steadily declining every single year since 2006.
Younger workers have been hit particularly hard. In 2007, the unemployment rate for the 20 to 29 age bracket was about 6.5 percent. Today, the unemployment rate for that same age group is about 13 percent.
If you are under the age of 30 and you aren't living with your parents, there is a really good chance that you are living in poverty. If you can believe it, U.S. families that have a head of household that is under the age of 30 have a poverty rate of 37 percent.
Our economy has been steadily bleeding huge numbers of middle class jobs, and many of those jobs have been replaced by low paying jobs in recent years.
According to one study, 60 percent of the jobs lost during the last recession were mid-wage jobs, but 58 percent of the jobs created since then have been low wage jobs.
And at this point, an astounding 53 percentof all American workers make less than $30,000 a year.
Oh, but "things are getting better", right?
Maybe if you live on Wall Street or if you arean employee of the federal government.
But for most families this economic decline has been a total nightmare. Median household income in America has fallen forfour consecutive years. Overall, it has declined by over $4000 during that time span.
Sometimes people forget how good things were about a decade ago. About three times as many new homes were sold in the United States in 2005 as were sold in 2012.
But we like to live in denial.
In fact, a lot of families are trying to keep up their standards of living by going into tremendous amounts of debt.
Back in 1983, the bottom 95 percent of all income earners in the United States had 62 cents of debt for every dollar that they earned. By 2007, that figure had soared to $1.48.
Fake it until you make it, right?
But how much debt can our system possibly handle?
Total home mortgage debt in the United States is now about 5 times larger than it was just 20 years ago.
Total credit card debt in the United States is now more than 8 times larger than it was just 30 years ago.
We are a nation that is completely addicted to debt, but as the financial crisis of 2008 demonstrated, all of that debt can have horrific consequences.
As the economy has slowed in recent years, the Federal Reserve has decided that "the solution" is to recklessly print money in an attempt to get the debt spiral cranked up again.
Have they gone overboard? You be the judge…
And of course this won't have any affect on the value of the money that you have been saving up all these years right?
Every single dollar that you own is continually losing value…
Overall, the value of the U.S. dollar has declined by more than 96 percent since the Federal Reserve was first created.
As the cost of living continues to go up and wages continue to go down, millions of American families have fallen out of the middle class and into poverty.
If you can believe it, the number of Americans on food stamps has grown from about 17 million in the year 2000 to more than 47 million today.
But "things are getting better", right?
Incredibly, more than a million public school students in the United States are homeless. This is the first time that has ever happened in our history.
But "things are getting better", right?
There are now 20.2 million Americans that spend more than half of their incomes on housing. That represents a 46 percent increase from 2001.
But "things are getting better", right?
In 1999, 64.1 percent of all Americans were covered by employment-based health insurance. Today, only 55.1 percent are covered by employment-based health insurance.
But "things are getting better", right?
Today, more Americans than ever have found themselves forced to turn to the federal government for help.
Overall, the federal government runs nearly 80 different "means-tested welfare programs", and at this point more than 100 million Americans are enrolled in at least one of them.
According to the U.S. Census Bureau, 49 percent of all Americans live in a home that receives direct monetary benefits from the federal government. Back in 1983, less than a third of all Americans lived in a home that received direct monetary benefits from the federal government.
So is it a good sign or a bad sign that the percentage of Americans that are financially dependent on the federal government is at an all-time high?
And in future years the number of Americans that are receiving benefits from the federal government is projected to absolutely skyrocket.
Back in 1965, only one out of every 50 Americans was on Medicaid. Today, one out of every 6 Americans is on Medicaid, and things are about to get a whole lot worse. It is being projected that Obamacare will add 16 million more Americans to the Medicaid rolls.
If you take a look at Medicare, things are very more sobering.
As I wrote recently, it is being projected that the number of Americans on Medicare will grow from 50.7 million in 2012 to 73.2 million in 2025.
At this point, Medicare is facing unfunded liabilities of more than 38 trillion dollars over the next 75 years. That comes to approximately $328,404 for every single household in the United States.
Are you ready to contribute your share?
Social Security is a complete and total nightmare as well.
Right now, there are approximately 56 million Americans collecting Social Security benefits.
By 2035, that number is projected to soar to an astounding 91 million.
Overall, the Social Security system is facing a134 trillion dollar shortfall over the next 75 years.
Oh, but don't worry because "things are getting better", right?
I honestly do not know how anyone can look at the numbers above and come to the conclusion that the economy is in good shape.
We have accumulated the largest mountain of debt in the history of the world, our economic infrastructure is being gutted, we are bleeding good jobs, government dependence is at an all-time high and we are getting poorer as a nation with each passing day.
But other than that, everything is rainbows and lollipops, right?
If you want to see the economic collapse, just open up your eyes.
And if dramatic changes are not made quickly, things are going to get much, much worse from here.
Please share this article with as many people as possible. Time is quickly running out and there are a whole lot of people out there that we need to wake up while we still can.
One thing I have learned is the incredible confidence people have in our economy, and the near total lack of credible evidence that they are wrong. It’s kind of like loving one’s government instead of their country, it simply makes no sense. Perhaps they don’t want to face the challenge of learning how to acquire protection from the collapse of our Nation. Try this http://harrydentpredictions.com/P209-PPC-Harry-Dent-Predictions-2013-TY.html
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June 25th, 2013 by olddog
Did you know that Barack Obama has been secretly negotiating the most important trade agreement since the formation of the World Trade Organization? Did you know that this agreement will impose very strict Internet copyright rules, ban all "Buy American" laws, give Wall Street banks much more freedom to trade risky derivatives and force even more domestic manufacturing offshore? If you have not heard about this treaty, don't feel bad. Obama has refused to even give Congress a copy of the draft agreement and he has banned members of Congress from attending the negotiations. The plan is to keep this treaty secret until the very last minute and then to railroad it through Congress and have it signed into law by October. The treaty is known as "the Trans-Pacific Partnership", and the nations that are reported to be involved in the development of this treaty include the United States, Canada, Japan, South Korea, Australia, New Zealand, Chile, Peru, Brunei, Singapore, Vietnam and Malaysia. Opponents of this treaty refer to it as "the NAFTA of the Pacific", and if it is enacted it will push the deindustrialization of America into overdrive.
The "one world" economic agenda that Barack Obama has been pushing is absolutely killing the U.S. economy. As you will see later in this article, we are losing jobs and businesses at an astounding pace. And each new "free trade" agreement makes things even worse.
For example, just check out the impact that the recent free trade agreement that Obama negotiated with South Korea is having on us…
A 10 percent decline of U.S. exports to Korea
The U.S. trade deficit with Korea has climbed 37 percent
U.S. auto industry has been crippled
Loss of U.S. control where international trade, banking and finance is concerned
A projected 159,000 jobs will be lost
Wait a second – I though that "free trade" agreements were actually supposed toincrease exports.
So why have they declined by 10 percent?
Did someone make a really bad deal?
And of course we have all seen the economic devastation that NAFTA has wrought.
When NAFTA was pushed through Congress in 1993, the United States actually had a tradesurplus with Mexico of 1.6 billion dollars. By 2010, we had a trade deficit with Mexico of61.6 billion dollars.
And "free trade" with China has turned out to be a complete and total nightmare as well.
Back in 1985, our trade deficit with China was approximately 6 million dollars (million with a little "m") for the entire year.
In 2012, our trade deficit with China was 315billion dollars. That was the largest trade deficit that one nation has had with another nation in the history of the world.
But instead of learning from the mistakes of the past, Barack Obama is pressing for more "free trade" agreements.
The New York Times is calling the Trans-Pacific Partnership "the most significant international commercial agreement since the creation of the World Trade Organization in 1995". It is reportedly going to include a whole host of provisions which would never be able to get through Congress on their own. Even though this treaty will affect all of our daily lives, the Obama administration is keeping this treaty a total secret. In fact, Obama won't even show it to Congress even though members of Congress have asked repeatedly to see it…
The agreement, under negotiation since 2008, would set new rules for everything from food safety and financial markets to medicine prices and Internet freedom. It would include at least 12 of the countries bordering the Pacific and be open for more to join. President Obama has said he wants to sign it by October.
Although Congress has exclusive constitutional authority to set the terms of trade, so far the executive branch has managed to resist repeated requests by members of Congress to see the text of the draft agreement and has denied requests from members to attend negotiations as observers — reversing past practice.
While the agreement could rewrite broad sections of nontrade policies affecting Americans’ daily lives, the administration also has rejected demands by outside groups that the nearly complete text be publicly released.
So exactly who in the world does this guy think that he is? Why won't Obama let us know exactly what is in this treaty?
Fortunately, there have been a few leaks. One thing that we have discovered is that this new treaty would reportedly ban all "Buy American laws".
That certainly would not be popular if it got out.
And do you remember SOPA?
The American people wanted nothing to do with the very strict Internet copyright provisions of SOPA and loudly expressed their displeasure to members of Congress.
Unfortunately, now the provisions of SOPA are back. It is being reported that most of the provisions of SOPA have been quietly inserted into this treaty. If this treaty is enacted, those provisions will become law and the American people will not be able to do anything about it.
And according to the New York Times, there are all sorts of other disturbing things that have been slipped into the treaty…
And yet another leak revealed that the deal would include even more expansive incentives to relocate domestic manufacturing offshore than were included in Nafta — a deal that drained millions of manufacturing jobs from the American economy.
The agreement would also be a boon for Wall Street and its campaign to water down regulations put in place after the 2008 financial crisis. Among other things, it would practically forbid bans on risky financial products, including the toxic derivatives that helped cause the crisis in the first place.
Are you starting to understand why the Obama administration is keeping this treaty such a secret?
If the details of this treaty were revealed to the American people right now, it would create such an uproar that Congress would never approve this treaty.
So please share this article with as many people as you can. We have got to get the American people educated about this.
Enough damage has already been done to the U.S. economy by "free trade" agreements. Just consider the following statistics…
-The United States has lost more than 56,000 manufacturing facilities since 2001.
-Back in the year 2000, there were more than 17 million Americans working in manufacturing. Now there are less than 12 million.
-There are less Americans working in manufacturing today than there was in 1950 even though the population of the country has more than doubled since then.
-According to the Economic Policy Institute, America is losing half a million jobs to China every single year.
-According to Professor Alan Blinder of Princeton University, 40 million more U.S. jobs could be sent offshore over the next two decades if current trends continue.
-Today, corporate profits as a percentage of U.S. GDP are at an all-time high, but wages as a percentage of U.S. GDP are near an all-time low.
-Without enough good jobs, more Americans are becoming dependent on the government. If you can believe it, the number of Americans on food stamps has gone from about 17 million in the year 2000 to more than 47 million today.
-Overall, the United States has run a trade deficit of more than 8 trillion dollars with the rest of the world since 1975.
And things continue to get even worse. The Institute for Supply Management manufacturing index declined to 49.0 in May. Any reading below 50 indicates contraction.
That was the lowest reading that we have seen since June 2009. Just like most of the rest of the world, we are rapidly heading toward another major economic downturn.
And if you want a perfect visual example of what deindustrialization is doing to America, just look at the city of Detroit.
It was once one of the greatest manufacturing cities in the history of the world, but now it is a rotting, decaying, festering hellhole.
According to the New York Times, there are now approximately 70,000 abandoned buildings in Detroit, and at this point the city is so broke that there is talk that the female giraffe at the Detroit Zoo could be sold offto help pay the bills.
For much more on how deindustrialization is ripping the guts out of the U.S. economy, please see the following articles…
1) "55 Reasons Why You Should Buy Products That Are Made In America"
2) "40 Ways That China Is Beating America"
3) "Show This To Anyone That Believes That 'Things Are Getting Better' In America"
4) "10 Amazing Charts That Demonstrate The Slow, Agonizing Death Of The American Worker"
5) "22 Stats That Show How The Emerging One World Economy Is Absolutely Killing American Workers"
What Barack Obama is trying to do is a mind blowing mistake.
The "one world" economic agenda that he is pursuing is destroying the American worker and the American middle class.
U.S. workers are being thrown into a global labor pool with workers on the other side of the planet that live in countries where it is legal to pay slave labor wages.
Do you want to directly compete with a worker on the other side of the globe that is doing your job for a dollar an hour with no benefits?
If not, you need to stand up and make your voice be heard.
There is no way in the world that American workers should have to compete for jobs with workers making slave labor wages in communist China.
What we desperately need are some red-blooded economic patriots to arise and to tell both political parties that we do not want this "one world" economic agenda.
So what do you think?
Will the American people wake up, or will our economy continue to lose thousands of businesses and millions of jobs?
Please feel free to post a comment with your thoughts below…
If Michael Snyder can find this information, and it is true, don’t you think most of Congress and the Senate knows what Obuma is doing?
Do you think they are all out chasing some sex obsession, drinking their self to death, or shooting up with some kind of dope? I’m asking this because it seems absurd that it isn’t common knowledge, and unless Michael has some crystal ball, or genie in a bottle, everyone in DC has known what OBUMA has been doing from the get go. SO, what do you think of our government now????? Make sure everyone you know has a copy of this article!
June 21st, 2013 by olddog
After the massive crash that rocked global markets in 2008, as Congress, central bankers and major financial institutions met in secret to mitigate the crisis, billionaires like Warren Buffet were buying up shares of some of the hardest hit companies.
At the time, the world was literally on the brink of an unprecedented economic collapse. It was so serious, in fact, thatmembers of Congress were told that should they fail to come to an agreement the fallout would leave the United States in such a state of disarray that martial law would be declared and tanks would be deployed to major American cities.
In the midst of it all, as if they had a private pipeline into the bailout meetings, the big boys were positioning themselves to profit. And profit they did, as the stock market rose from 6500 points in late 2008 to record highs as recently as last month. They made billions of dollars on the backs of bailouts funded by taxpayers who were themselves struggling to pay their mortgages and put food on the table.
They knew then what their friends at the Federal Reserve, Treasury and investment banks were planning to do. And they took the opportunity to make a killing.
Now, with the stock market indicating to the masses that the promised recovery has taken hold, and with mainstream analysts arguing that happy days are here again, those same moguls of finance who were undoubtedly tipped off in 2008, are making some very big moves yet again.
But these particular moves are exactly the opposite of what you might expect given that we’re at the beginning of a supposed recovery:
Despite the 6.5% stock market rally over the last three months, a handful of billionaires are quietly dumping their American stocks . . . and fast.
Warren Buffett, who has been a cheerleader for U.S. stocks for quite some time, is dumping shares at an alarming rate. He recently complained of “disappointing performance” in dyed-in-the-wool American companies like Johnson & Johnson, Procter & Gamble, and Kraft Foods.
In the latest filing for Buffett’s holding company Berkshire Hathaway, Buffett has been drastically reducing his exposure to stocks that depend on consumer purchasing habits. Berkshire sold roughly 19 million shares of Johnson & Johnson, and reduced his overall stake in “consumer product stocks” by 21%. Berkshire Hathaway also sold its entire stake in California-based computer parts supplier Intel.
With 70% of the U.S. economy dependent on consumer spending, Buffett’s apparent lack of faith in these companies’ future prospects is worrisome.
Unfortunately Buffett isn’t alone.
Fellow billionaire John Paulson, who made a fortune betting on the subprime mortgage meltdown, is clearing out of U.S. stocks too. During the second quarter of the year, Paulson’s hedge fund, Paulson & Co., dumped 14 million shares of JPMorgan Chase. The fund also dumped its entire position in discount retailer Family Dollar and consumer-goods maker Sara Lee.
Finally, billionaire George Soros recently sold nearly all of his bank stocks, including shares of JPMorgan Chase, Citigroup, and Goldman Sachs. Between the three banks, Soros sold more than a million shares.
So why are these billionaires dumping their shares of U.S. companies?
From Money News via StanDeyo.com
The simple answer is… they know.
They know that this market has beenpropped up by trillion dollar infusionsfrom the Federal Reserve.
They know that Americans have lost 55% of their wealth since this crisis started.
They know nearly 25% of Americans are out of work (as opposed to the official 7.5% figures from the BLS) and that no meaningful jobs are being created.
They know that half of American households require government assistance, 100 million people are on welfare and nearly a quarter of them need nutritional assistanceto put food on the table..
They know that the economic growth rates being disseminated to the people are completely bogus because they fail to account for the inflationary impact of the Fed’s monetary expansion.
They know this is wholly unsustainable, and they are getting out of Dodge before the next phase of this crisis takes hold and hammers the world yet again.
Ben Bernanke’s magic show will soon come to an end, and all of his tricks will be exposed for the statistical illusions they really are.
Billionaires know this and they are preparing for the inevitable. The government, likewise, is preparing for financial collapse and the potential for widespread violence that will follow.
You should be doing the same.
You can read more of Mac Slavo's work at SHTFplan.com, where this article first appeared.
June 20th, 2013 by olddog
Excerpt from THE GREAT DEFORMATION: The Corruption of Capitalism in America
By David A. Stockman.
The stage was thus set for the final “run” on the dollar and for a spectacular default by the designated “reserve currency” provider under the gold exchange standard’s second outing. And as it happened, the American people saw fit to install in the White House in January 1969 just the man to crush what remained of gold-based money and the financial discipline that it enabled.
Richard M. Nixon, as we know, possessed numerous and notable flaws. Foremost was his capacity to carry a grudge against anyone whom he believed had caused him to lose an election, especially any economist, policy maker, or bystander who could be pinned with accountability for the mild 1960 recession that he believed responsible for his loss to John F. Kennedy.
Nixon’s vendetta on the matter of the 1960 election literally knew no limits. For example, he insisted that a midlevel career bureaucrat named Jack Goldstein, who headed the Bureau of Labor Statistics (BLS), had deliberately spun the monthly unemployment report issued on the eve of the 1960 election so as to damage his campaign. Eight years later, Nixon informed the White House staff that job one was to determine if Goldstein was still at the BLS, and to get him fired if he was.
It is not surprising, therefore, that Nixon rolled into the Oval Office obsessed with replacing Chairman Martin and bringing the Fed to heel. To be sure, his only real interest in monetary policy consisted of ensuring that the one great threat to Republican success, a rising unemployment rate, did not happen in the vicinity of an election.
Yet it was that very cynicism which made him prey to Milton Friedman’s alluring doctrine of floating paper money. As has been seen, Nixon wanted absolute freedom to cause the domestic economy to boom during his 1972 reelection campaign. Friedman’s disciples at Camp David served up exactly that gift, and wrapped it in the monetary doctrine of the nation’s leading conservative intellectual.
Friedman’s Rule of Fixed Money Supply Growth Was Academic Poppycock
Those adhering to traditional monetary doctrine always and properly feared the inflationary threat of state-issued fiat money. So when the CPI reached the unheard of peacetime level of 6.3 percent by January 1969, it was a warning that the tottering structure of Bretton Woods was reaching a dangerous turning point and that the monetary foundation of the postwar world was in peril.
But not according to Professor Milton Friedman. As was typical of the Chicago school conservatives, he simply brushed off the gathering inflationary crisis as the product of dimwits at the Fed. Martin’s “mistake” in succumbing to pressure to open up the monetary spigot to fund LBJ’s deficits, Friedman insisted, could be easily fixed. Literally, with the flick of a switch.
According to Professor Friedman’s vast archive of historic data, inflation would be rapidly extinguished if money supply was harnessed to a fixed and unwavering rate of growth, such as 3 percent per annum. If that discipline was adhered to consistently, nothing more was needed to unleash capitalist prosperity—not gold convertibility, fixed exchange rates, currency swap lines, or any of the other accoutrements of central banking which had grown up around the Bretton Woods system.
Indeed, once the central bank got the money supply growth rate into a fixed and reliable groove, the free market would take care of everything else, including determination of the correct exchange rate between the dollar and every other currency on the planet. Under Friedman’s monetary deus ex machina, for example, the unseen hand would silently and efficiently mete out rewards for success and punishments for failure in the banking and securities markets. The need for clumsy and inefficient regulation of financial institutions would be eliminated.
Friedman’s “fixed rule” monetary theory was fundamentally flawed, however, for reasons Martin had long ago discovered down in the trenches of the financial markets. The killer was that the Federal Reserve couldn’t control Friedman’s single variable, which is to say, the “money supply” as measured by the sum of demand deposits and currency (M1).
During nearly two decades at the helm, Martin learned that the only thing the Fed could roughly gauge was the level of bank reserves in the system. Beyond that there simply weren’t any fixed arithmetic ratios, starting with the “money multiplier.”
The latter measured the ratio between bank reserves, which are potential money, and bank deposits, which are actual money. As previously indicated, however, commercial banks don’t create actual money (checking account deposits) directly; they make loans and then credit the proceeds to customer accounts. So the transmission process between bank reserves and money supply wends through bank lending departments and the credit creation process.
Needless to say, the Fed couldn’t control the animal spirits of either lenders or borrowers; that was the job of free market interest rates. Accordingly, banks would utilize their reserves aggressively during periods of robust loan demand until borrower exuberance was choked off by high interest rates. By contrast, bank reserves would lie fallow during times of slumping loan demand and low free market rates. The “money multiplier” therefore varied enormously, depending upon economic and financial conditions.
Furthermore, even if the resulting “money supply” could be accurately measured and controlled, which was not the case, it did not have a fixed “velocity” or relationship to economic activity or GDP, either. In fact, during deflationary times of weak credit expansion, velocity tended to fall, meaning less new GDP for each new dollar of M1. On the other hand, during inflationary times of rapid bank credit expansion it would tend to rise, resulting in higher GDP gains per dollar of M1 growth.
So the chain of causation was long and opaque. The linkages from open market operations (adding to bank reserves) to commercial bank credit creation (adding to the money supply) to credit-fueled additional spending (adding to GDP) resembled nothing so much as the loose steering gear on an old jalopy: turning the steering wheel did not necessarily mean the ditch would be avoided.
Most certainly there was no possible reason to believe that M1 could be managed to an unerring 3 percent growth rate, and that, in any event, keeping M1 growth on the straight and narrow would lead to any predictable rate of economic activity or mix of real growth and inflation. In short, Friedman’s single variable–fixed money supply growth rule was basically academic poppycock.
The monetarists, of course, had a ready answer to all of these disabilities; namely, that there were “leads and lags” in the transmission of monetary policy, and that given sufficient time the money multipliers and velocity would regress to a standard rate. Yet that “sufficient time” caveat had two insurmountable flaws: it meant that Friedman’s fixed rule could not be implemented in the real day-to-day world of fast-moving financial markets; and more importantly, it betrayed the deep, hopeless political naïveté of the monetarists and Professor Friedman especially.
The Monetarist Cone: Silly Putty on the White House Graphs
As to practicality, I had a real-time encounter with it during the Reagan years when the Treasury’s monetary policy post was held by a religious disciple of Friedman: Beryl Sprinkel. Week after week at White House economic briefings he presented a graph based on the patented “monetarist cone.” The graph consisted of two upward-sloping dotted lines from a common starting date which showed where the money supply would be if it had been growing at an upper boundary of, say, 4 percent and a lower boundary of, say, 2 percent.
The implication was that if the Fed were following Professor Friedman’s rule, the path of the actual money supply would fall snugly inside the “cone” as it extended out over months and quarters, thereby indicating that all was well on the monetary front, the only thing which mattered. Except the solid line on the graph tracking the actual week-to-week growth of money supply gyrated wildly and was almost always outside the cone, sometimes on the high side and other times on the low.
In other words, the greatest central banker of modern times, Paul Volcker, was flunking the monetarists’ test week after week, causing Sprinkel to engage in alternating bouts of table pounding because the Fed was either dangerously too tight or too loose. Fortunately, Sprinkel’s graphs didn’t lead to much: President Reagan would look puzzled, Jim Baker, the chief of staff, would yawn, and domestic policy advisor Ed Meese would suggest moving on to the next topic.
More importantly, Volcker could easily explain the manifold complexities and anomalies in the short-term movement of the reported money supply numbers, and that on an “adjusted” basis he was actually inside the cone. Besides that, credit growth was slowing sharply, from a rate of 12 percent in 1979 to 7 percent in 1981 and 3 percent in 1982. That caused the economy to temporarily buckle and inflation to plunge from double digits to under 4 percent in less than twenty-four months. Volcker was getting the job done, in compliance with the monetarist cone or not.
In fact, the monetarist cone was just a Silly Putty numbers exercise, representing annualized rates of change from an arbitrary starting date that kept getting reset owing to one alleged anomaly or another. The far more relevant imperative was to slow the perilous expansion of the Fed’s balance sheet. It had doubled from $60 billion to $125 billion in the nine years before Volcker’s arrival at the Eccles Building, thereby saturating the banking system with newly minted reserves and the wherewithal for inflationary credit growth.
Volcker accomplished this true anti-inflation objective with alacrity. By curtailing the Fed’s balance sheet growth rate to less than 5 percent by 1982, Volcker convinced the markets that the Fed would not continue to passively validate inflation, as Burns and Miller had done, and that speculating on rising prices was no longer a one-way bet. Volcker thus cracked the inflation spiral through a display of central bank resolve, not through a single-variable focus on a rubbery monetary statistic called M1.
Volcker also demonstrated that the short-run growth rate of M1 was largely irrelevant and impossible to manage, but that the Fed could nevertheless contain the inflationary furies by tough-minded discipline of its own balance sheet. Yet that very success went straight to an even more fatal flaw in the monetarist fixed money growth rule: Friedman never explained how the Fed, once liberated from the external discipline of the Bretton Woods gold standard, would be continuously populated with iron-willed statesmen like Volcker, and how they would even remain in office when push came to shove like it did during the monetary crunch of 1982.
In fact, Volcker’s reappointment the next year was a close call because most of the White House staff and the Senate Republican leadership wanted to take him down, owing to the considerable political inconvenience of the recessionary trauma his policies had induced. Senate leader Howard Baker, for example, angrily demanded that Volcker “get his foot off the neck of American business now.”
Volcker survived only because of Ronald Reagan’s stubborn (and correct) belief that the Fed’s long bout of profligacy had caused inflation and that only a period of painful monetary parsimony could cure it. The next several decades would prove decisively, however, that the process of American governance produces few Reagans and even fewer Volckers.
So Friedman unleashed the demon of floating-rate money based on the naïve view that the inhabitants of the Eccles Building could and would follow his monetary rules. That was a surprising posture because Friedman’s splendid scholarship on the free market, going all the way back to his pioneering critique of New York City rent controls in the late 1940s, was infused with an abiding skepticism of politicians and all of their mischievous works.
Yet by unshackling the Fed from the constraints of fixed exchange rates and the redemption of dollar liabilities for gold, Friedman’s monetary doctrine actually handed politicians a stupendous new prize. It rendered trivial by comparison the ills owing to garden variety insults to the free market, such as rent control or the regulation of interstate trucking.
Implicit Rule by Monetary Eunuchs
The Friedman monetary theory actually placed the nation’s stock of bank reserves, money, and credit under the unfettered sway of what amounted to a twelve-member monetary politburo. Once relieved of the gold standard’s external discipline, the central banking branch of the state thus had unlimited scope to extend its mission to plenary management of the nation’s entire GDP and for deep, persistent, and ultimately suffocating intervention in the money and capital markets.
It goes without saying, of course, that the libertarian professor was not peddling a statist scheme. So the implication was that the Fed would be run by self-abnegating monetary eunuchs who would never be tempted to deviate from the fixed money growth rule or by any other manifestation of mission creep. Needless to say, Friedman never sought a franchise to train and appoint such governors, nor did he propose any significant reforms with respect to the Fed’s selection process or of the manner in which its normal operations were conducted.
This glaring omission, however, is what made Friedman’s monetarism all the more dangerous. His monetary opus, A Monetary History of the United States, was published only four years before his disciples, led by George Shultz, filled the ranks of the Nixon White House in 1969.
Possessed with the zeal of recent converts, they soon caused a realworld experiment in Friedman’s grand theory. In so doing, they were also implicitly betting on an improbable proposition: that monetarism would work because the run-of-the-mill political appointees—bankers, economists, businessmen, and ex-politicians who then sat on the Federal Open Market Committee (FOMC), along with their successors—would be forever smitten with the logic of 3 percent annual money supply growth.
Friedman’s Great Gift to Wall Street
The very idea that the FOMC would function as faithful monetary eunuchs, keeping their eyes on the M1 gauge and deftly adjusting the dial in either direction upon any deviation from the 3 percent target, was sheer fantasy. And not only because of its political naïveté, something Nixon’s brutalization of the hapless Arthur Burns aptly conveyed.
Friedman’s austere, rule-bound version of discretionary central banking also completely ignored the Fed’s susceptibility to capture by the Wall Street bond dealers and the vast network of member banks, large and small, which maintained their cash reserves on deposit there. Yet once the Fed no longer had to worry about protecting the dollar’s foreign exchange value and the US gold reserve, it had a much wider scope to pursue financial repression policies, such as low interest rates and a steep yield curve, that inherently fuel Wall Street prosperity.
As it happened, the Fed’s drift into these Wall Street–pleasing policies was temporarily stalled by Volcker’s epic campaign against the Great Inflation. Dousing inflation the hard way, through brutal tightening of money market conditions, Volcker had produced the singular nightmare that Wall Street and the banking system loathe; namely, a violent and unprecedented inversion of the yield curve.
With short-term interest rates at 20 percent or more and way above long-term bond yields (12–15 percent), it meant that speculators and banks could not make money on the carry trade and that the value of dealer stock and bond inventories got clobbered: high and rising interest rates mean low and falling financial asset values. Accordingly, the Volcker Fed did not even dream of levitating the economy through the “wealth effects” or by coddling Wall Street speculators.
Yet once Volcker scored an initial success and was unceremoniously dumped by the Baker Treasury Department (in 1987), the anti-inflation brief passed on to a more congenial mechanism; that is, Mr. Deng’s industrial army and the “China price” deflation that rolled across the US economy in the 1990s and after. With inflation-fighting stringency no longer having such immediate urgency, it did not take long for the Greenspan Fed to adopt a prosperity promotion agenda.
First, however, it had to rid itself of any vestigial restraints owing to the Friedman fixed money growth rule. The latter was dispatched easily by a regulatory change in the early 1990s which allowed banks to offer “sweep” accounts; that is, checking accounts by day which turned into savings accounts overnight. Accordingly, Professor Friedman’s M1 could no longer be measured accurately.
Out of sight was apparently out of mind: for the last two decades, the central bank that Friedman caused to be liberated from the alleged tyranny of Bretton Woods so that it could swear an oath of fixed money supply growth has not even bothered to review or mention money supply. Indeed, the Greenspan and Bernanke Fed have been wholly preoccupied with manipulation of the price of money, that is, interest rates, and have relegated Friedman’s entire quantity theory of money to the dustbin of history. And Bernanke claims to have been a disciple!
Constrained neither by gold nor a fixed money growth rule, the Fed in due course declared itself to be the open market committee for the management and planning of the nation’s entire GDP. In this Brobdingnagian endeavor, of course, the Wall Street bond dealers were the vital transmission belt which brought credit-fueled prosperity to Main Street and delivered the elixir of asset inflation to the speculative classes. Consequently, when it came to Wall Street, the Fed became solicitous at first, and craven in the end.
Apologists might claim that Milton Friedman could not have foreseen that the great experiment in discretionary central banking unleashed by his disciples in the Nixon White House would result in the abject capitulation to Wall Street which emerged during the Greenspan era and became a noxious, unyielding reality under Bernanke. But financial statesmen of an earlier era had embraced the gold standard for good reason: it was the ultimate bulwark against the pretensions and follies of central bankers.
Copyright © 2013 David Stockman. Used with the author's permission.
David Stockman was director of the Office of Management and Budget under President Ronald Reagan, serving from 1981 until August 1985. He was the youngest cabinet member in the 20th century. See David Stockman's article archives.
May 31st, 2013 by olddog
Our government is broke, in fact they are beyond broke!
Treasury Secretary Jack Lew
broke since the 2008-09 decisionwas made to cover the derivative debt losses of the criminal banksters. As a result of theirfinancial desperation, the government, on behalf of Wall Street, has become increasingly desperate, aggressive and criminal.
There can be no doubt that most of the aware among us are cognizant of the ongoing government discussions being held about their intentions of requiring every U.S. citizen to put at least a portion of their retirement savings into a government-controlled retirement accounts regardless of whether they have your approval or not.
As I have reported before, Treasury Secretary, Jack Lew, has announced that he is “borrowing” from federal pension funds this summer in order to help the federal government meet its debt obligations. Since the national deficit is $17 trillion dollars and the unfunded federal mandated liabilities will exceed $200 trillion dollars in one year, these victimized federal workers will never see their fullretirement. And if you find yourself breathing a sigh of relief because you do not work for the federal government, you have sadly deluded yourself because the government mafia is coming after all forms ofretirement accounts, both pension funds and invested retirements (e.g. 401k’s).
Why Would the Feds Start Their Crime Spree With Federal Retirement Accounts?
If the federal government is planning to steal retirements, would they be wise to steal them incrementally, or all at once? Of course, incremental theft is always preferable because it avoids an initial widespread confrontation with the public. And who better for the federal government to steal from than federal employees because who are they going to complain to?
Federal Employees Are Just the First Wave of Victims.
Our criminal-in-chief has suggested totally new and extremely onerous taxes to pay for Obamacare (e.g. a 5% tax on all home sales). He also has announced that he is expanding welfare program, including a new national sales tax as well as a national transaction tax.
The Treasury department is even discussing a new wealth tax coming to America. It is already in place in countries like France, Spain, and England. For some in France, the tax will reach 100% of earned income. Blue blood money is presently fleeing these countries.
Let’s say you are a small businessman, who despite Obama’s best efforts to destroy your business, becomes successful and begin to gross over $200,000 dollars per year. Your success will be short lived as you will hand over MOST of your income to the Sheriff of Nottingham (i.e. The Federal Government Mafia).
What Is A Citizen to Do?
First, we need to realize that there are morons among us who think it is somehow our duty to bail out the government and Wall Street. After all, the government and its parent companies, the Wall Street corporations, are too big to fail.
Second, you need to realize that it is YOU that must take action to preserve what little the government lets you keep. It is your money and therefore, your responsibility.
Third, you need to be aware of the fact that the government can never pay down the debt that they have acquired. Could the federal mafia pay down the $17 trillion dollar deficit? Yes, but they would need 2-3 generations of responsible fiscal policies to do so. Could the federal mafia ever meet its $200 trillion dollar unfunded liabilities such as Social Security and Medicare? The short and best answer is, NEVER. Even if by some miracle we could pay off the unfunded liabilities, totalling almost a quarter of a quadrillion debt, there is even a bigger reason why we can NEVER financially recover. America is doomed to absolute economic failure and there is nothing that can be done. When you understand that we can never pay the debt, and the collapse is evitable, then perhaps you will move to protect what you can.
The Final Nail
America, while you slept, your country was stolen from you. Your country was absconded by all the political misfits and corporate criminals that the disenfranchised former Republicans and Democrats have been trying to warn you about over the last several years.
Laws, originating out of New Deal legislation, written in response tothe Great Depression, provided some measure of protection for the American financial system from the unsavory forces which led to its initial demise in 1929. In 2008, corporate greed, governmental corruption and a populace who is asleep at the wheel, has succeeded in achieving what historians will someday label the “Greatest Depression of 2009.” I say The Greatest Depression of 2009, because that is when this irreversible action called the bailouts commenced. Most of the loyalists in this country objected to the bailouts strictly on philosophical grounds. Very few of us understood how catastrophic the bail outs would prove to be.
When Congress was intimidated into approving a series of bailouts,America signed her own death warrant. The remainder of this article will explain exactly why there is absolutely no way that America can financially survive. History, will clearly demonstrate that destruction of the late, great American economy was entirely self-inflicted.
What You Don’t Know Can Hurt You
If Americans knew their history, then we would be cognizant of the fact that one of the prime causes of the Great Depression was due tostock investors buying shares on margin (i.e., loans). The passage of the Glass Steagall Act protected Americans from this shady practice by separating commercial banking from this investment practice of stockbrokers. However, with one stroke of his New World Order pen, Bill Clinton’s repeal of the Glass-Steagall act opened the flood gates for the domestic AND foreign infusion of bad credit into both our stock market and banking system. Consequently, both industries stand upon the precipice of collapse in what is quickly becoming the most massive wealth transfer in world history. .
On September 30, 1999 , Fannie Mae and Freddie Mac sought governmental permission to “relax” (i.e., break) the prudent governmental regulations on sound lending practices and begin to make loansto individuals who were not credit worthy. This spelled the death of the mortgage industry as we once knew it.
The Uptick Rule once prevented companies from crashing due to large scale shorting of company stock. Do you remember it was Goldman Sachs that was fined for shorting mortgages just preceding the bursting of the mortgage bubble?
A company’s stock could not be sold short as long as it was in continuous decline. The short sellers had to wait for an uptick in the stock before engaging in shorting. At the urging of Goldman Sachs and Hank Paulson, the Uptick Rule was retired in 2007 and the rest, as they say, is history.
The elimination of the Uptick Rule is like going to a basketball game and not being able to see the scoreboard. Who’s ahead, who’s behind? Nobody knows but “Ladies and Gentlemen, place your bets!” What is your stock portfolio worth? Who knows? Who cares? Somebody wealthy is getting wealthier at your expense and you and your middle class investors are none the wiser. Let me be crystal clear here, the worst parts of today’s financial crisis was orchestrated by Goldman Sachs and Hank Paulson.
The derivative market is the main impetus for the breakdown of the American economy. The rapid increase in the price of fuel during the last several years is a good example of the destructive nature of the derivative market and it is this market which fueled the greatest debt load every visited upon the planet. Most of the price gouging which resulted in unprecedented increases in gas prices, and record oil company profits, was due to speculation in futures and this, again, was led by Goldman Sachs which just happens to be Treasury Secretary’s Henry Paulson’s old company. The derivatives market subsequently collapsed because the rampant speculative nature of futures drove prices, including homes and real estate through the roof. However, the real damage done by the collapse in derivatives is the fact that almost all other forms of financial instruments are tied to this market because they banks pledged their collateral assets to back this market.
A Quick Financial Lesson
In trying to write for the layman, I endeavor to make this as simple as possible. It is not an overstatement to proclaim that if you do not understand the principles discussed in the following paragraphs, you will have little chance in surviving the impending collapse and you will never know what has hit you when the inevitable comes.
Derivatives are not stocks or bonds or anything of tangible value. This is the ultimate money game in which paper derived from other paper, such as futures and options, has served to bolster the balance sheets on Wall Street. Futures and options are exchange and traded derivatives, but the largest group of derivatives is not even traded on the exchanges. These are called “counterparty derivatives” and consist of such financial entities as mortgage backed securities (MBS) and credit default swaps. After assimilating this material it will become obvious why the Federal Reserve is purchasing MBS’ to the tune of $40 billion per month, every month. This process began in September 2013. Of course, you should know that the Federal Reserve is just printing the money out of thin air, thus, making your existing cash supply worth a lot less.
It is estimated that total derivative exposure of the financial system is between one quadrillion and one and a half quadrillion. A quadrillion is 1,000 trillion dollars and the derivative market has largely collapsed.
The entire Gross Domestic Product (GDP) of all the world’s countries in 2009 was approximately 60 trillion dollars. GDP is an economic terms for everything that is produced for sale. The American middle class is being asked to bear the burden of the entire derivatives market which totals over 16 times the net value of the entire planet. The “Bail Out Monies” cannot not come close to covering the shortfall.
Where do you think the bail out money will go? Ask yourself why so many corporate heads are building homes overseas? Why did George Bush build a 100,000 acre ranch in Paraguay? Why is NORTHCOM, a combat organization, engaging in urban riot control training in terms of suppressing civil unrest? And again, we know that DHS has purchased 2.2 billion rounds of ammunition to go with their acquisition of 2700 armored personnel carriers. Are we to believe that all of these factors are unrelated? It is looking more and more like the bailout is actually doing what the name implies. Are we being asked to fund the getaway gifts for those that have stolen so much from the American people?
At one point, America spoke with one voice: “NO BAILOUT FOR THE CROOKS.” “Let Rome burn” was the prevailing feeling. We cheered as the House of Representatives voted down the attempt at further fleecing the American middle class. If the middle class is going down, then so should the Wall Street crooks who put “Mainstreet America” in this predicament. Despite this victory for the people, most Americans were disappointed that the crooks and the corrupt politicians, who put America in this dilemma, were not going to prison.
The no-bail-out-victory of the people was indeed short lived. Eventually, the House, bent to pressure applied by then Treasury Secretary, former Goldman Sachs official, Hank Paulson, in which he said if we did not bail out his former firm and the majority of Wall Street, we would have martial law in the streets. Well, four years later, we are more broke than ever and martial law is imminent.
“Meet the new boss, the same as the old boss” in which our corporate masters are determined to have their way with the assets of American people.
The banksters have us where they want us. We are in an endless, unpayable stream of debt with no hope of escaping unless we repudiate the debt. However, the people who could do that work for the banksters.
The Punch Line
As I will detail in Part Four of this series, there are things that you may do to lessen the impact of the coming collapse. However, I believe with a few common sense actions, it is possible to have a relatively soft landing in the face of the coming collapse. Of course, that assumes that you can protect what you have.
April 9th, 2013 by olddog
By DAVID A. STOCKMAN
The Dow Jones and Standard & Poor’s 500 indexes reached record highs on Thursday, having completely erased the losses since the stock market’s last peak, in 2007. But instead of cheering, we should be very afraid.
Over the last 13 years, the stock market has twice crashed and touched off a recession: American households lost $5 trillion in the 2000 dot-com bust and more than $7 trillion in the 2007 housing crash. Sooner or later — within a few years, I predict — this latest Wall Street bubble, inflated by an egregious flood of phony money from the Federal Reserve rather than real economic gains, will explode, too.
Since the S.&P. 500 first reached its current level, in March 2000, the mad money printers at the Federal Reserve have expanded their balance sheet sixfold (to $3.2 trillion from $500 billion). Yet during that stretch, economic output has grown by an average of 1.7 percent a year (the slowest since the Civil War); real business investment has crawled forward at only 0.8 percent per year; and the payroll job count has crept up at a negligible 0.1 percent annually. Real median family income growth has dropped 8 percent, and the number of full-time middle class jobs, 6 percent. The real net worth of the “bottom” 90 percent has dropped by one-fourth. The number of food stamp and disability aid recipients has more than doubled, to 59 million, about one in five Americans.
So the Main Street economy is failing while Washington is piling a soaring debt burden on our descendants, unable to rein in either the warfare state or the welfare state or raise the taxes needed to pay the nation’s bills. By default, the Fed has resorted to a radical, uncharted spree of money printing. But the flood of liquidity, instead of spurring banks to lend and corporations to spend, has stayed trapped in the canyons of Wall Street, where it is inflating yet another unsustainable bubble.
When it bursts, there will be no new round of bailouts like the ones the banks got in 2008. Instead, America will descend into an era of zero-sum austerity and virulent political conflict, extinguishing even today’s feeble remnants of economic growth.
THIS dyspeptic prospect results from the fact that we are now state-wrecked. With only brief interruptions, we’ve had eight decades of increasingly frenetic fiscal and monetary policy activism intended to counter the cyclical bumps and grinds of the free market and its purported tendency to underproduce jobs and economic output. The toll has been heavy.
As the federal government and its central-bank sidekick, the Fed, have groped for one goal after another — smoothing out the business cycle, minimizing inflation and unemployment at the same time, rolling out a giant social insurance blanket, promoting homeownership, subsidizing medical care, propping up old industries (agriculture, automobiles) and fostering new ones (“clean” energy, biotechnology) and, above all, bailing out Wall Street — they have now succumbed to overload, overreach and outside capture by powerful interests. The modern Keynesian state is broke, paralyzed and mired in empty ritual incantations about stimulating “demand,” even as it fosters a mutant crony capitalism that periodically lavishes the top 1 percent with speculative windfalls.
The culprits are bipartisan, though you’d never guess that from the blather that passes for political discourse these days. The state-wreck originated in 1933, when Franklin D. Roosevelt opted for fiat money (currency not fundamentally backed by gold), economic nationalism and capitalist cartels in agriculture and industry.
Under the exigencies of World War II (which did far more to end the Depression than the New Deal did), the state got hugely bloated, but remarkably, the bloat was put into brief remission during a midcentury golden era of sound money and fiscal rectitude with Dwight D. Eisenhower in the White House and William McChesney Martin Jr. at the Fed.
Then came Lyndon B. Johnson’s “guns and butter” excesses, which were intensified over one perfidious weekend at Camp David, Md., in 1971, when Richard M. Nixon essentially defaulted on the nation’s debt obligations by finally ending the convertibility of gold to the dollar. That one act — arguably a sin graver than Watergate — meant the end of national financial discipline and the start of a four-decade spree during which we have lived high on the hog, running a cumulative $8 trillion current-account deficit. In effect, America underwent an internal leveraged buyout, raising our ratio of total debt (public and private) to economic output to about 3.6 from its historic level of about 1.6. Hence the $30 trillion in excess debt (more than half the total debt, $56 trillion) that hangs over the American economy today.
This explosion of borrowing was the stepchild of the floating-money contraption deposited in the Nixon White House by Milton Friedman, the supposed hero of free-market economics who in fact sowed the seed for a never-ending expansion of the money supply. The Fed, which celebrates its centenary this year, fueled a roaring inflation in goods and commodities during the 1970s that was brought under control only by the iron resolve of Paul A. Volcker, its chairman from 1979 to 1987.
Under his successor, the lapsed hero Alan Greenspan, the Fed dropped Friedman’s penurious rules for monetary expansion, keeping interest rates too low for too long and flooding Wall Street with freshly minted cash. What became known as the “Greenspan put” — the implicit assumption that the Fed would step in if asset prices dropped, as they did after the 1987 stock-market crash — was reinforced by the Fed’s unforgivable 1998 bailout of the hedge fund Long-Term Capital Management.
That Mr. Greenspan’s loose monetary policies didn’t set off inflation was only because domestic prices for goods and labor were crushed by the huge flow of imports from the factories of Asia. By offshoring America’s tradable-goods sector, the Fed kept the Consumer Price Index contained, but also permitted the excess liquidity to foster a roaring inflation in financial assets. Mr. Greenspan’s pandering incited the greatest equity boom in history, with the stock market rising fivefold between the 1987 crash and the 2000 dot-com bust.
Soon Americans stopped saving and consumed everything they earned and all they could borrow. The Asians, burned by their own 1997 financial crisis, were happy to oblige us. They — China and Japan above all — accumulated huge dollar reserves, transforming their central banks into a string of monetary roach motels where sovereign debt goes in but never comes out. We’ve been living on borrowed time — and spending Asians’ borrowed dimes.
This dynamic reinforced the Reaganite shibboleth that “deficits don’t matter” and the fact that nearly $5 trillion of the nation’s $12 trillion in “publicly held” debt is actually sequestered in the vaults of central banks. The destruction of fiscal rectitude under Ronald Reagan — one reason I resigned as his budget chief in 1985 — was the greatest of his many dramatic acts. It created a template for the Republicans’ utter abandonment of the balanced-budget policies of Calvin Coolidge and allowed George W. Bush to dive into the deep end, bankrupting the nation through two misbegotten and unfinanced wars, a giant expansion of Medicare and a tax-cutting spree for the wealthy that turned K Street lobbyists into the de facto office of national tax policy. In effect, the G.O.P. embraced Keynesianism — for the wealthy.
The explosion of the housing market, abetted by phony credit ratings, securitization shenanigans and willful malpractice by mortgage lenders, originators and brokers, has been well documented. Less known is the balance-sheet explosion among the top 10 Wall Street banks during the eight years ending in 2008. Though their tiny sliver of equity capital hardly grew, their dependence on unstable “hot money” soared as the regulatory harness the Glass-Steagall Act had wisely imposed during the Depression was totally dismantled.
Within weeks of the Lehman Brothers bankruptcy in September 2008, Washington, with Wall Street’s gun to its head, propped up the remnants of this financial mess in a panic-stricken melee of bailouts and money-printing that is the single most shameful chapter in American financial history.
There was never a remote threat of a Great Depression 2.0 or of a financial nuclear winter, contrary to the dire warnings of Ben S. Bernanke, the Fed chairman since 2006. The Great Fear — manifested by the stock market plunge when the House voted down the TARP bailout before caving and passing it — was purely another Wall Street concoction. Had President Bush and his Goldman Sachs adviser (a k a Treasury Secretary) Henry M. Paulson Jr. stood firm, the crisis would have burned out on its own and meted out to speculators the losses they so richly deserved. The Main Street banking system was never in serious jeopardy, ATMs were not going dark and the money market industry was not imploding.
Instead, the White House, Congress and the Fed, under Mr. Bush and then President Obama, made a series of desperate, reckless maneuvers that were not only unnecessary but ruinous. The auto bailouts, for example, simply shifted jobs around — particularly to the aging, electorally vital Rust Belt — rather than saving them. The “green energy” component of Mr. Obama’s stimulus was mainly a nearly $1 billion giveaway to crony capitalists, like the venture capitalist John Doerr and the self-proclaimed outer-space visionary Elon Musk, to make new toys for the affluent.
Less than 5 percent of the $800 billion Obama stimulus went to the truly needy for food stamps, earned-income tax credits and other forms of poverty relief. The preponderant share ended up in money dumps to state and local governments, pork-barrel infrastructure projects, business tax loopholes and indiscriminate middle-class tax cuts. The Democratic Keynesians, as intellectually bankrupt as their Republican counterparts (though less hypocritical), had no solution beyond handing out borrowed money to consumers, hoping they would buy a lawn mower, a flat-screen TV or, at least, dinner at Red Lobster.
But even Mr. Obama’s hopelessly glib policies could not match the audacity of the Fed, which dropped interest rates to zero and then digitally printed new money at the astounding rate of $600 million per hour. Fast-money speculators have been “purchasing” giant piles of Treasury debt and mortgage-backed securities, almost entirely by using short-term overnight money borrowed at essentially zero cost, thanks to the Fed. Uncle Ben has lined their pockets.
If and when the Fed — which now promises to get unemployment below 6.5 percent as long as inflation doesn’t exceed 2.5 percent — even hints at shrinking its balance sheet, it will elicit a tidal wave of sell orders, because even a modest drop in bond prices would destroy the arbitrageurs’ profits. Notwithstanding Mr. Bernanke’s assurances about eventually, gradually making a smooth exit, the Fed is domiciled in a monetary prison of its own making.
While the Fed fiddles, Congress burns. Self-titled fiscal hawks like Paul D. Ryan, the chairman of the House Budget Committee, are terrified of telling the truth: that the 10-year deficit is actually $15 trillion to $20 trillion, far larger than the Congressional Budget Office’s estimate of $7 trillion. Its latest forecast, which imagines 16.4 million new jobs in the next decade, compared with only 2.5 million in the last 10 years, is only one of the more extreme examples of Washington’s delusions.
Even a supposedly “bold” measure — linking the cost-of-living adjustment for Social Security payments to a different kind of inflation index — would save just $200 billion over a decade, amounting to hardly 1 percent of the problem. Mr. Ryan’s latest budget shamelessly gives Social Security and Medicare a 10-year pass, notwithstanding that a fair portion of their nearly $19 trillion cost over that decade would go to the affluent elderly. At the same time, his proposal for draconian 30 percent cuts over a decade on the $7 trillion safety net — Medicaid, food stamps and the earned-income tax credit — is another front in the G.O.P.’s war against the 99 percent.
Without any changes, over the next decade or so, the gross federal debt, now nearly $17 trillion, will hurtle toward $30 trillion and soar to 150 percent of gross domestic product from around 105 percent today. Since our constitutional stasis rules out any prospect of a “grand bargain,” the nation’s fiscal collapse will play out incrementally, like a Greek/Cypriot tragedy, in carefully choreographed crises over debt ceilings, continuing resolutions and temporary budgetary patches.
The future is bleak. The greatest construction boom in recorded history — China’s money dump on infrastructure over the last 15 years — is slowing. Brazil, India, Russia, Turkey, South Africa and all the other growing middle-income nations cannot make up for the shortfall in demand. The American machinery of monetary and fiscal stimulus has reached its limits. Japan is sinking into old-age bankruptcy and Europe into welfare-state senescence. The new rulers enthroned in Beijing last year know that after two decades of wild lending, speculation and building, even they will face a day of reckoning, too.
Indebtedness Dwarfs the Economy
MULTIMEDIA FEATURE: A Gallery of Economic Villains and Heroes
A gallery of “heroes” who championed sound money and fiscal rectitude and “villains” who led the United States down the path of insolvency.
THE state-wreck ahead is a far cry from the “Great Moderation” proclaimed in 2004 by Mr. Bernanke, who predicted that prosperity would be everlasting because the Fed had tamed the business cycle and, as late as March 2007, testified that the impact of the subprime meltdown “seems likely to be contained.” Instead of moderation, what’s at hand is a Great Deformation, arising from a rogue central bank that has abetted the Wall Street casino, crucified savers on a cross of zero interest rates and fueled a global commodity bubble that erodes Main Street living standards through rising food and energy prices — a form of inflation that the Fed fecklessly disregards in calculating inflation.
These policies have brought America to an end-stage metastasis. The way out would be so radical it can’t happen. It would necessitate a sweeping divorce of the state and the market economy. It would require a renunciation of crony capitalism and its first cousin: Keynesian economics in all its forms. The state would need to get out of the business of imperial hubris, economic uplift and social insurance and shift its focus to managing and financing an effective, affordable, means-tested safety net.
All this would require drastic deflation of the realm of politics and the abolition of incumbency itself, because the machinery of the state and the machinery of re-election have become conterminous. Prying them apart would entail sweeping constitutional surgery: amendments to give the president and members of Congress a single six-year term, with no re-election; providing 100 percent public financing for candidates; strictly limiting the duration of campaigns (say, to eight weeks); and prohibiting, for life, lobbying by anyone who has been on a legislative or executive payroll. It would also require overturning Citizens United and mandating that Congress pass a balanced budget, or face an automatic sequester of spending.
It would also require purging the corrosive financialization that has turned the economy into a giant casino since the 1970s. This would mean putting the great Wall Street banks out in the cold to compete as at-risk free enterprises, without access to cheap Fed loans or deposit insurance. Banks would be able to take deposits and make commercial loans, but be banned from trading, underwriting and money management in all its forms.
It would require, finally, benching the Fed’s central planners, and restoring the central bank’s original mission: to provide liquidity in times of crisis but never to buy government debt or try to micromanage the economy. Getting the Fed out of the financial markets is the only way to put free markets and genuine wealth creation back into capitalism.
That, of course, will never happen because there are trillions of dollars of assets, from Shanghai skyscrapers to Fortune 1000 stocks to the latest housing market “recovery,” artificially propped up by the Fed’s interest-rate repression. The United States is broke — fiscally, morally, intellectually — and the Fed has incited a global currency war (Japan just signed up, the Brazilians and Chinese are angry, and the German-dominated euro zone is crumbling) that will soon overwhelm it. When the latest bubble pops, there will be nothing to stop the collapse. If this sounds like advice to get out of the markets and hide out in cash, it is.
David A. Stockman is a former Republican congressman from Michigan, President Ronald Reagan’s budget director from 1981to 1985 and the author, most recently, of “The Great Deformation: The Corruption of Capitalism in America.”
February 25th, 2013 by olddog
By Anthony Wile
"Fiscal trouble ahead for most future retirees." Or so the Washington Post tells us in a recent column explaining why future retirees (Baby Boomers) are headed for considerable trouble. Grim reading, actually.
For the first time since the New Deal, a majority of Americans are headed toward a retirement in which they will be financially worse off than their parents, jeopardizing a long era of improved living standards for the nation's elderly, according to a growing consensus of new research.
This is worth commenting on because it only illustrates a larger point we've made a number of times: The system is broken and if you listen to mainstream financial advice you're going to end up homeless on a soup line hoping for dinner.
What is pernicious about articles like this one, in my humble view, is that they purport to be telling the truth but don't provide either context or historical accuracy. Here's more from the Post article:
The Great Recession and the weak recovery darkened the retirement picture for significant numbers of Americans. And the full extent of the damage is only now being grasped by experts and policymakers. There was already mounting concern for the long-term security of the country's rapidly graying population. Then the downturn destroyed 40 percent of Americans' personal wealth, while creating a long period of high unemployment and an environment in which savings accounts pay almost no interest. Although the surging stock market is approaching record highs, most of these gains are flowing to well-off Americans who already are in relatively good shape for retirement.
Liberal and conservative economists worry that the decline in retirement prospects marks a historic shift in a country that previously has fostered generations of improvement in the lives of the elderly. It is likely to have far-reaching implications, as an increasing number of retirees may be forced to double up with younger relatives or turn to social-service programs for support. "This is the first time that Americans are going to be relatively worse off than their parents or grandparents in old age," said Teresa Ghilarducci, director of the Schwartz Center for Economic Policy Analysis at the New School for Social Research.
Advocates for older Americans are calling on the federal government to bolster Social Security benefits or to create a new layer of retirement help for future retirees. Others want employers and the government to do more to encourage retirement savings and to discourage workers from using the money for non-retirement purposes.
But those calls have been overwhelmed by concern about the nation's fast-growing long-term debt, which has left many policy-makers focused on ways to trim Social Security and other retirement benefits rather than increase them. The economic downturn exacerbated long-term factors that were already eroding the financial standing of aging Americans: an inexorable rise in health-care costs, growing debt among older Americans and a shift in responsibility from employers to workers to plan for retirement.
The article never explains the "Great Recession" but merely asserts it – like a fact of life. We are supposed to accept that these things occur without searching for the cause. But those who don't understand history are doomed to repeat it.
There were, of course, those who understood quite clearly what was about to happen. They did their best to warn us but the powers-that-be (and general population) remained complacent. Late in 2007, things took a turn for the worse. The economy began to crash and by 2008 the devastation had spread to the rest of the world and the "sovereign" debt crisis had begun to afflict Europe.
In Greece, Spain, Portugal – most of Southern and Eastern Europe – retirements have been reduced or have evaporated entirely as a result of the "Great Recession." In the US, tens of millions lost 50 percent of their life savings or more in the ongoing crashes of 2007 and 2008. And today, tens of millions more don't have anything else to lose.
While once children could have supported their aged parents, the current crisis has reduced the employment prospects for young people in much of Europe to nearly nil. None of this was expected by those involved but a lot of it was predicted by those who understood monetary history and were aware of its goals.
One can argue, of course, that this was part of a larger Money Power strategy to create a fiat dollar – and shove the world toward a single currency. If so, then the rest of the West's (especially the US's) monetary history makes a lot of sense. Sovereign overspending was utilized to generate the justification for a deal with Japan. Japan would buy US treasuries and US consumers would purchase Japanese products.
This elevated some Japanese companies to world class status and also made Japan a more consumerist and Westernized society. The same sort of thing happened in China in the later 1990s and 2000s. Africa is apparently next on the list to be consolidated. In each instance, a case is made for the transformative effects of capitalism but unfortunately, it is not capitalism that is being created but a kind corporatist mercantilism.
The Washington Post article seems to yearn for the past, when government programs were seen as helpful and effective. Here's the important graf:
The precarious situation comes after a long period of change that improved life for the nation's seniors starting with the enactment of Social Security in 1935. By the 1960s, retirees also benefitted from universal health insurance through Medicare and Medicaid, sharp increases in Social Security benefits and new protections enacted by the federal government for workers who received traditional pensions, which for decades were a standard employee benefit. The changes rescued millions of retirees from poverty, while lifting millions of others to prosperous retirements symbolized by vacation cruises, recreational vehicles and second homes. But now problems for future retirees seem to be closing in from all sides.
You see? This is a sentiment that is beyond simplistic. It is dangerous. The more that people put their trust – and financial health – into the proverbial hands of the state, the more apt they are to end up without the security they've counted on. We can see this today. It is not a hypothesis but a reality.
Historically speaking, modern corporatist states are not run for citizens' benefit. The concern that is expressed, the dialogue that is being presented every day, are merely distractions. Think of how many billions of words have been written about Western retirements, how to save for the future and how to invest in a profitable way. Despite all that has been talked about, written and otherwise presented, the current system is wrecked and people's prospects are getting worse not better.
Lately, I've noticed an uptick in people's positive emotional response to the markets and the economy. But the same misinformation and economic manipulation that occurred before is occurring now. Central banks have dumped tens of trillions into the larger marketplace and when that money begins to circulate rates will have to be raised and recoveries, such as they are, will be cut short. The dollar reserve system itself must be seen as in a kind of terminal decline as well. Sorry, folks.
Let price inflation move up even a little, and the carrying costs of US debt will likely become insupportable. These trends simply aren't being explained on a regular basis. Instead, we get alarmed articles about how a US "savings deficit" has to yield to targeted, government oriented financial programs. Alternatively, we get widely publicized policy battles about deficit reduction and continued and expanded "austerity." But neither government programs nor austerity will help salvage the larger economy, in my opinion.
Here's the good news, though: You don't have to worry about it.
There are practical steps you can take to help yourself. Some of them you'll find right within the pages of this website, TheDailyBell.com. Don't wait for government. Don't keep hoping that bureaucratic "wonkery" will come to the rescue. Recognize you have to do it yourself.
There are, of course, certain kinds of equity opportunities that you can invest in – if you can find a trusted advisor. And there are – or should be – steps you can take to move some of your holdings offshore and into precious metals or even real estate. There are plenty of other positive steps you can take on your own and within your community to ensure your and your family's safety.
We are still being taught to look toward government for the solution to our private retirement dilemmas and general prosperity. The last century should have taught us that this is a chimera – what we like to call a dominant social theme – that government and public spending are a substitute for individual responsibility.
Unfortunately, no matter how many articles are written, or how much is broadcast, reality doesn't change. The person responsible for you is … you. And if you are to have a good and hopefully prosperous life, you will have to take action to make it so.
What can I say when I cannot convince my children, or my wife, that every dollar you can spare must go into silver. Either bars and coins or coins only depending on the amount of your funds. Gold is a good place for savvy investors but the average blue collar worker with three or four hundred thousand saved and invested, is at a disadvantage over how and when to buy and sell. Also, every middle class investor has been brain washed into looking for return on investment. In good times that is the way to go, but this is a time for preserving your assets, not increasing them. The powers that be, are manipulating both metals as much as they can, but silver has always been the commodity that carried through to the end. Gold, by its very nature is more attractive to the powers that be, and will continue to fluctuate violently before the bankers lose control of it. Silver by contrast is the poor investor’s salvation, as it has always been the most stable in the long run of any commodity. Don’t take my word for it, as there are hundreds of knowledgeable advisers on the net. Sort them out according to common sense and put your money in silver before you lose it all. Paper investments are going to be toilet paper investments before this is over.
Right now, anyone who has stocked up on ammunition is making a killing, but the days of buying it cheap and in quantity are long gone. Ditto for most other necessities of life. Those who have waited have lost the chance to survive and prosper. If you take any of this advise to heart, make this your highest concern, If you don’t have it, you don’t own it. Take possession of your silver and protect it with your life. Stay away from paper instruments. They are paper dollars in disguise.
January 28th, 2013 by olddog
By Dr. Edwin Vieira, Jr., Ph.D., J.D.
December 17, 2012
Well, Ladies and Gentlemen in the ethereal realm, once again another natural disaster—Hurricane Sandy in this case—has exposed the insouciance, ineptitude, and incompetence of America’s incestuously inbred political class. Not only have these worthies and their minions in all of the self-aggrandizing “homeland-security agencies” proven quite unprepared to protect Americans from the effects of the storm in an adequate and timely manner; but also over the years they have even actively discouraged common Americans from taking the steps to protect themselves that should have been obvious to anyone with an IQ higher than his age. And if a mere hurricane—a type of natural disaster with which Americans have long had experience—striking just one part of this country overtaxes the skills of these “homeland-security experts”, what will transpire when the monetary and banking systems collapse throughout the land?
The answer to this question is, of course, that unmitigated chaos will reign supreme, particularly in urban areas.
The way to deal with that problem is, however, not to blabber about how supposedly “this country is finished” (as all too many disconsolate patriots do)—or to propose such desperate expedients as “secession”, which will not by itself guarantee preparedness, and the possible success of which depends in the first instance upon the most heightened form of preparedness. Rather, the correct recourse is to start revitalizing “the Militia of the several States”, State by State, immediately if not sooner. In which event, this country will be preserved, and appeals to “secession” (and other pie-in-the-sky political panaceas) will be recognized as unnecessary.
As readers of my columns are well aware, I have been urging revitalization of the Militia for many years—and, each and every year, some new catastrophes wrought by Nature or outrages perpetrated by rogue public officials have proven the wisdom of, and the increasingly urgent need for taking, that course of action.
The American people, however, cannot be expected to do what they are not equipped to do. How can Americans revitalize their Militia, when they know next to nothing about the Militia? Well, everyone is familiar with the old saying: “Give a man a fish, and you feed him for that one day. Teach a man to fish, and he can feed himself every day thereafter.” In the spirit of that homespun advice, I have completed a definitive study, entitled The Sword and Sovereignty: The Constitutional Principles of “the Militia of the several States”, which should provide every reader with all of the information requisite to understand the origin of the Militia, their special place under the Declaration of Independence and within the Constitution’s federal system, and why (as the Second Amendment declares) they are “necessary to the security of a free State”. Not optional, but necessary.
Among other topics covered in its 1,944 pages of text, The Sword and Sovereignty explains:
• how the Militia would serve as the ultimate embodiments and instruments of WE THE PEOPLE’S authority under the Declaration of Independence and the Constitution;
• how the Militia would enable to States to enforce federalism through constitutional interposition against rogue agents of the General Government;
• how the Militia would enable a patriotic President of the United States to fulfill his constitutional duty to “take Care that the Laws be faithfully executed” against those combinations that now threaten this country’s independence and well-being, but are too powerful to be suppressed through the normal course of honest judicial proceedings;
• how the Militia would expose and punish usurpations of power and mal-administration by rogue and incompetent public officials at every level of the federal system;
• how the Militia would provide the indispensable “checks and balances” against a rogue “standing army” and “military-industrial complex”;
• how the Militia would eliminate all “gun control” that did not specifically promote “the right of the people to keep and bear Arms”;
• how the Militia would put a stop to the present-day rampages of police brutality once and for all, in the most swift, sure, and severe manner possible;
• how the Militia would guarantee the conduct of honest elections; and, last but not least,
• how the Militia would establish in the most expeditious fashion an economically sound and constitutional alternative currency and structure of new free-market prices in anticipation of the inevitable collapse of the Federal Reserve System’s fascistic banking cartel.
Time being of the essence, and the costs of printing a first-quality book of this size being what they are, I have arranged for an electronic version of The Sword and Sovereignty to be produced on a CD. The disk contains the full 2,304 pages of introductory material, text, authorities cited in the footnotes, and endnotes in PDF format accessible with Adobe Reader 6.0 (or some later version). This presentation allows for use of the standard PDF search feature, which many people have suggested would be desirable.
The Sword and Sovereignty is now available exclusively through amazon.com.
© 2012 Edwin Vieira, Jr. – All Rights Reserved
Edwin Vieira, Jr., holds four degrees from Harvard: A.B. (Harvard College), A.M. and Ph.D. (Harvard Graduate School of Arts and Sciences), and J.D. (Harvard Law School).
For more than thirty years he has practiced law, with emphasis on constitutional issues. In the Supreme Court of the United States he successfully argued or briefed the cases leading to the landmark decisions Abood v. Detroit Board of Education, Chicago Teachers Union v. Hudson, and Communications Workers of America v. Beck, which established constitutional and statutory limitations on the uses to which labor unions, in both the private and the public sectors, may apply fees extracted from nonunion workers as a condition of their employment.
He has written numerous monographs and articles in scholarly journals, and lectured throughout the county. His most recent work on money and banking is the two-volumePieces of Eight: The Monetary Powers and Disabilities of the United States Constitution (2002), the most comprehensive study in existence of American monetary law and history viewed from a constitutional perspective.www.piecesofeight.us
He is also the co-author (under a nom de plume) of the political novel CRA$HMAKER: A Federal Affaire (2000), a not-so-fictional story of an engineered crash of the Federal Reserve System, and the political upheaval it causes.www.crashmaker.com
His latest book is: "How To Dethrone the Imperial Judiciary" … and Constitutional "Homeland Security," Volume One, The Nation in Arms…
He can be reached at his new address:
52 Stonegate Court
Front Royal, VA 22630.
Buy a copy or two of this PDF book, study it and give a copy to your local sheriff. It will be the smartest thing you can do to help save our country.
January 25th, 2013 by olddog
Written by Lawrence Sellin
The US federal government has strayed so far from the Constitution and the rule of law that it can now be considered rogue and illegitimate.
The thoroughly irresponsible rate of government spending projected over the next twenty-five years will drive federal debt to unsustainable levels. The country is heading for a financial meltdown and economic ruin.
The Republican Party is inept and impotent and cannot provide the necessary political opposition to the crimes and unconstitutional policies of the Obama regime or stand against the rampant voter fraud which is now polluting the electoral process. There is a report claiming that the Republican Party signed a legal agreement with the Democrat Party in 1982 not to pursue suspected vote fraud. If there is no guarantee of election integrity, then elections become only window dressing for tyranny.
Barack Obama is an illegal President and unindicted felon. Congress, the American media and the courts are engaged in a criminal conspiracy to conceal their complicity in perpetrating the Obama fraud on the American people. Law enforcement and our elected officials have chosen to risk the survival of the country rather than risk the truth.
According to recent reports, Obama continues to use a Social Security Number (SSN) not issued to him, in the process, committing numerous counts of social security fraud. The SSN Obama uses, issued in Connecticut, a state where he never lived, does not pass a check with E-Verify, the electronic system the U.S. Citizenship and Immigrations Services of the U.S. Department of Homeland Security has created to verify whether or not prospective employees have the required authorization to work legally in the United States. It appears that the SSN Obama uses, was actually issued to a Harrison J. Bounel, born in 1890. Once issued, a SSN is never reissued to another individual. Why isn’t any of that evidence investigated? It is because Barack Obama is protected by a dishonest media and criminally complicit federal officials and, unlike ordinary Americans, he is above the law.
The US no longer has representative government. Members of Congress seek election not to uphold the Constitution and serve the American people, but to obtain power and to use that power to accrue professional and financial benefits for themselves and their major supporters. All the traditional means for the American people to seek the redress of grievances have now been blocked by a corrupt government composed of a self-absorbed permanent political elite unaccountable to the people.
The status quo is no longer defensible. Unless there is a significant reversal soon, it is only a matter of time that a catastrophe will be upon us, which will inevitably lead to national collapse and fragmentation.
All unconstitutional and unlawful policies of the Obama regime must be opposed, obstructed and undermined. The Democrat Party and their radical left-wing supporters must be aggressively and continuously confronted. The Republican Party must be defunded and its leadership replaced. The purveyors of disinformation and propaganda represented by most of the mainstream media must be professionally destroyed.
A county by county battle is the means by which the American people can restore the Constitution, establish responsible fiscal policies and take back control of the political process and the government. Patriots need to organize locally outside of the party apparatus to exert political pressure and prepare for armed defense, if necessary. No county officials, in particular the Sheriff, should be elected or maintained in office, who do not fully honor their oath to support and defend the Constitution.
Fundamental to this effort are the rights guaranteed under the Second Amendment. Each county should establish elements of an organized and disciplined Constitutional Army with sufficient arms and ammunition to maintain a status of independence and individual liberty from anyone who might attempt to abuse them.
It is indeed ironic that the Mexican border made maximally porous by the Obama regime may become the route of choice for weapon and ammunition resupply, a Fast and Furious in reverse, capable of making gun control about as successful as the national prohibition of alcohol (1920-33), another failed “noble experiment” undertaken to reduce crime and solve social problems.
Efforts should be directed towards decreasing the influence of the federal government in county affairs, cooperating with federal officials and agencies only when it benefits local citizens. Counties should maximize the consumption of federal resources and overburdening federal agencies administratively while at the same time reducing or delaying taxes paid to the federal government. County residents should forcefully shun, oppose or drive out of business, individuals or media outlets, which support the criminal Obama regime.
“Power concedes nothing without a demand. It never did, and it never will. Find out just what people will submit to, and you have found out the exact amount of injustice and wrong which will be imposed upon them; and these will continue until they are resisted with either words or blows, or with both. The limits of tyrants are prescribed by the endurance of those whom they oppress.” — Frederick Douglass, August 4, 1857.
Lawrence Sellin, Ph.D. is a retired colonel with 29 years of service in the US Army Reserve and a veteran of Afghanistan and Iraq. Colonel Sellin is the author of “Afghanistan and the Culture of Military Leadership“. He receives email at email@example.com.
HOORAY FOR SELLIN!
NOW WE KNOW THERE IS AT LEAST ONE COURAGEOUS MAN LEFT IN AMERICA.
January 22nd, 2013 by olddog
Recently by Robert Anderson: What Will the Doctors Do?
by Robert Anderson
Silence rarely conveys knowledge, especially when it’s the result of intimidation. There are moments when it’s prudent to remain silent, but hardly when you’re in the midst of a gun ownership debate. The political classes, and its anti-gun proponents, are today engaged in a massive legal assault on citizen gun ownership through regulation and/or abolition. Their arguments are well known and much has been written on the subject, both in favor and in opposition to the idea.
Unfortunately, silence due to "political correctness" is hampering a frank and honest discussion of the fundamental issue of citizen gun ownership. While gun ownership for personal protection or sporting uses are being heatedly defended, these are only secondary considerations to the more critical concern over citizen ownership of guns. The preeminent and fundamental case for gun ownership by citizens is to secure and preserve the means for individuals to safeguard their lives and property from a potentially threatening oppressive government.
Of course this tends to sound paranoid, for after all, most citizens today view our government as a responsive political institution, primarily engaged in helping its citizens to secure a better quality of life. Such common sentiments about one’s government are not new. Even the Germans shared such a view of their own government at the beginning of the 20th century. So, to express concerns today that our politicians and bureaucrats could someday turn against their own citizens and inflict violent harm upon them is harshly condemned by many as being ludicrous.
After all, many politicians and anti-gun proponents today are convinced no democratic government could ever become so oppressive and dictatorial, certainly not our own. But what we believe and what may prove true are not always the same. We know the face of the future is forever veiled by the hand of God and none of us can ever know with certainty where we’re headed. But acquiring an understanding of the past is another matter, and we’d all be wise to heed it. Too often the past is prologue to the future so it’s always prudent to remind ourselves of Edmund Burke’s famous line, "Those who cannot remember the past are condemned to repeat it." And it’s equally important to remind ourselves that the essence of government is a sovereign power with a monopoly over initiating force upon others, a coercive power which has become deadly and violent many times throughout the ages.
For anti-gun proponents to ignore the ravages of 20th century history and believe today’s citizens should be denied the means to protect themselves from the risk of future oppressive tyranny is both dangerous and foolhardy. Have we forgotten how Germany, Russia, and China disarmed their citizens in the 20th century, and shortly thereafter their governments slaughtered tens of millions of their own citizens? Have we forgotten the "killing fields" of Cambodia where disarmed citizens were slaughtered close to annihilation in the 1970’s by their own government? Those slaughtered were the helpless victims of their well-intentioned citizen ancestors who acquiesced to government mandated gun control.
Of course, today’s anti-gun proponents and their political allies will argue, those places were all different and such horrors could never happen in our country, so why do our citizens need to own guns? Indeed, citizens may not need guns to secure their lives and property from our government today, but can anyone argue with certainty that future citizens will never need guns for that purpose? After all, today’s anti-gun proponents are essentially betting on the lives of future citizens, and while making such a costless bet among themselves, do so by placing a deadly bet on the lives of future citizens, should their bet today prove horribly wrong tomorrow!
Every decision imposes costs in our imperfect world, and the issue of citizens owning guns is no exception. We all know gun ownership will surely bring some harm as long as evil and ignorance remain a part of the human condition. Without question, guns will continue to be used in many gruesome and horrible murders by deranged and evil people. But peaceful citizens must have the means to protect themselves from not only the isolated acts of criminals but also from an oppressive government tomorrow with the capacity for evil mass murder. These threats far outweigh any perceived "benefit" from permitting an intrusive government to disarm its citizens today. Such a threatened act, at the very least, would transform future citizens into helpless victims, should an evil authoritarian government someday try to subdue them.
Citizen gun ownership is ultimately a form of "insurance" for a future, unknowable risk. Switzerland, as well as our own country, has acknowledged and practiced this form of "insurance" for a long time. We all know gun ownership by citizens can impose heavy costs, but they are costs dwarfed by the greater horror of millions of future citizens being denied any means to defend themselves against an evil government slaughtering them with impunity.
We would like to believe such a future scenario unimaginable, but we know it’s not, as our violent 20th century history has tragically reminded us. Governments murdering millions of their own citizens have inflicted monstrous horrors in our lifetimes, and there is nothing in the history of the human experience to give absolute assurance it will not happen again. The drafters of our Constitution understood this, and hopefully today’s citizens will remember it, even though mentioning such a horror makes people uncomfortable, a reaction usually encountered when discussing unpleasant truths.
Finally, there are few instances in a citizen’s relationship with government where non-intervention in their personal affairs is more vital than with gun ownership. The Second Amendment was established as a safeguard for citizens, should the government they created ever become evil and oppressive, to have an effective means to defend themselves against that government. With that thought in mind, what would be more devastating than for a future evil government to possess individual records on every citizen who owns a gun, what kind of guns they own, and where he lives? Draw your own conclusions: Is it either prudent or wise to surrender individual gun ownership information to any government today which could become your evil oppressor tomorrow? Can’t happen? Tell it to the Germans and Russians a century ago!
January 14, 2013
IF YOU’RE NOT
OF OUR FEDERAL
Obama only wants military leaders
who will fire on U.S. citizens
Examiner – by Dave Gibson
On Monday, renowned author and humanitarian Dr. Jim Garrow made a shocking claim about what we can expect to see in Obama’s second term.
Garrow made the following Facebook post:
I have just been informed by a former senior military leader that Obama is using a new “litmus test” in determining who will stay and who must go in his military leaders. Get ready to explode folks. “The new litmus test of leadership in the military is if they will fire on US citizens or not.” Those who will not are being removed.
So, who is the source?
Garrow replied: “The man who told me this is one of America’s foremost military heroes.”
Understand, this is not coming from Alex Jones or Jesse Ventura, or from anyone else the left often dismisses with great ease.
Garrow is a well-respected activist and has spent much of his life rescuing infant girls from China, babies who would be killed under that country’s one-child policy. He was also nominated for Nobel Peace Prize for his work.
His bio on Amazon.com reads:
Dr. James Garrow is the author of The Pink Pagoda: One Man’s Quest to End Gendercide in China. He has spent over $25 million over the past sixteen years rescuing an estimated 40,000 baby Chinese girls from near-certain death under China’s one-child-per-couple policy by facilitating international adoptions. He is the founder and executive director of the Bethune Institute’s Pink Pagoda schools, private English-immersion schools for Chinese children. Today he runs 168 schools with nearly 6,300 employees.
This comes on the heels of Sunday’s report in the Washington Free Beacon (WFB) that the head of Central Command, Marine Corps Gen. James Mattis is being dismissed by Obama and will leave his post in March.
The WFB article states:
“Word on the national security street is that General James Mattis is being given the bum’s rush out of his job as commander of Central Command, and is being told to vacate his office several months earlier than planned.”
Did Gen. Mattis refuse to “fire on U.S. citizens?”
Thanks to TransAm for this article.
January 4th, 2013 by olddog
When in the course of human events, it becomes necessary for one people to dissolve the political bands which have connected them with another, and to assume among the powers of the earth, the separate and equal station to which the laws of nature and/or of nature’s God(s) entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation.
The federal government headquartered in Washington, DC, having promised to the several states that, “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances,” hath reneged on this vow. Several religions are banned, (1) multiple channels of the press eradicated, (2) and protest rights have been trampled upon. (3)
That federal government, having promised, “A well regulated Militia, being necessary to the security of a free State, the right of the people to keep and bear Arms, shall not be infringed,” hath infringed on the right of the people to keep and bear arms. (4) In this manner, that federal government not only infringes on the regulations set forth by the second constitutional amendment, it secures that its militia feels little need to be regulated by the other amendments.
That federal government, having promised, “The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no warrants shall issue, but upon probable cause, supported by Oath or Affirmation, and particularly describing the place to be searched, and the persons or things to be seized,” hath, unwarranted, infringed on the security of our papers. (5)
That federal government, having promised, “No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a Grand Jury, except in cases arising in the land or naval forces, or in the Militia, when in actual service in time of War or public danger; nor shall any person be subject for the same offense to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation,” hath compelled those suspected of crimes to bear witness against themselves (6) (7). It hath deprived the citizens of these several states of lives, liberty, and property without the due process of law. (8) (9) It hath taken private property for public use without just compensation. (10)
That federal government, having promised, “In all criminal prosecutions, the accused shall enjoy the right to a speedy and public trial, by an impartial jury of the State and district wherein the crime shall have been committed, which district shall have been previously ascertained by law, and to be informed of the nature and cause of the accusation; to be confronted with the witnesses against him; to have compulsory process for obtaining witnesses in his favor, and to have the Assistance of Counsel for his defence,” hath denied the right to trial by an impartial jury of the State and district wherein the crime shall have been committed in matters concerning income taxation. (11)
That federal government, having promised, “In Suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved, and no fact tried by a jury, shall be otherwise re-examined in any Court of the United States, than according to the rules of the common law,” hath denied this due process. (12)
That federal government, having promised, “Excessive bail shall not be required, nor excessive fines imposed, nor cruel and unusual punishments inflicted,” hath imposed excessive fines (13) and cruel and unusual punishments. (14)
We, therefore, the representatives of [insert your state here], in general congress, assembled, appealing to the rule of natural law for the rectitude of our intentions, do, in the name, and by authority of the good people of [insert your state here], solemnly publish and declare, that [insert your state here] of right ought to be a free and independent state; that it is absolved from all allegiance to the federal government in Washington, DC, and that all political connection between them and the federal government in Washington, DC, is and ought to be totally dissolved; and that as a free and independent state, it has the full power to levy war, conclude peace, contract alliances, establish commerce, and to do all other acts and things which independent states may of right do.
I pray that it does not need be said, this document needs to be forwarded to your State Representatives for them to complete, sign, and present to the Federal Government, as the Constitution is a contract with the States and not with the general population of America. The results will surely convince you that a revolution is our only choice, and State Secession the outcome.
January 1st, 2013 by olddog
01 01 13 A TERRIFYING VISION OF AMERICA
The Coming Terror and A Power to Change the World
The year 2013 is going to bring unprecedented social anarchy, riots, food shortages, more mass shootings, political upheaval, economic crisis and a radical transformation of our nation. As the late Dr. Francis Schaeffer said, about thirty years ago, “An authoritarian government either from the right or left will rise to manage the chaos.”
Most of what we are seeing now fits the precise historical patterns of what happen in places like Nazi Germany, where Adolph Hitler murdered over seven million people in concentration camps. The German Jews, as well as the Christians were in such a state of psychological denial, that they repeatedly said, “It can’t happen here.” When they walking into the gas chambers, they insisted they were just getting a shower.
What is it that prevents people from seeing the obvious either on a personal level or a national level? There are a number of factors in this psychological process. First, self-deception and cognitive dissonance. A mother cannot bear the thought of her little daughter being molested by her husband, so she pretends not to notice the evidence. Finally she disassociates from the reality.
On a national level, many times the people, especially the youth, have been deliberately dumbed down through social engineering. They simply do not understand the historical patterns and how they repeat themselves. In addition, through social engineering they have been brainwashed into accepting a system of reality, rather than reality itself.
Finally, the science of mass mind control is used to program the people, through the media, entertainment, legal drugs, pornography, education and entertainment. Aldous Huxley, H.G.Wells and Thomas Pynchon and others wrote about this in their books like, The Shape of Things to Come, Brave New World, and Gravity’s Rainbow. The science of mass mind control came from Nimrod and the ancient occult religions of Babylon. They operated both spiritually and scientifically. Today scientific and spiritual mind control are so advanced that the average person does not know that they exist, let alone how advanced they have become. In America today the vast percentage of the population is under scientific mind control, where they have been programmed and live in a trance state. This is one of the primary reasons that they cannot see the obvious; they have been scientifically brainwashed. In addition to that, they live in denial and cognitive dissonance.
A key element in the science of occult-based mind control (all mind control is occult-based) is trauma-based programming. The mind is controlled through a series of traumatic shocks viewed on television or the Internet, experienced in the sociological environment, or through highly advanced technologies like EMF waves, subliminal programming, silent sound, microchip implants, drugs and mass occult rituals along with occult symbolism. Recent examples of this would be the Olympic Ceremony in Great Britain, which enacted a Satanic ritual, disguised as entertainment, with blatant Luciferian symbols that go back to Babylon. A large percentage of rock’n’roll concerts and performers perform occult rituals along with mind control. The Illuminati symbolism is blatant if you understand the meaning of the symbols.
Modern rock’n’roll concerts are simply mass occult worship. The ancient occult worship of occult gods like Molech consisted of the use of mind-altering drugs, hypnotic rhythms in the music, and sexual immorality, which were designed to summon their gods or various entities. Everything we just discussed not only programs people through occult-based programming, but acts as a powerful mechanism for mass mind control. Since the fundamental consciousness of people has been altered, they live in hypnotic and trance states, doing what they have been conditioned to do.
In addition, all of this produces spiritual deception through false messiahs and false teachers, which the Apostle Paul warned about when he referred to the Great Delusion and the Apostasy in the last days. According to the Biblical view, the world is quickly heading towards a one world government, a one world economic system, and a one world religion that is headed up by two beasts, the Antichrist and the False Prophet.
It is not an accident that Sir Francis Bacon, a Rosicrucian, planned for America to be the center of a new world order and a “New Atlantis” before America was settled. The Rosicrucian occult movement has its roots in the occult religions of ancient Babylon. The Rosicrucians became the Illuminati and it is the Illuminati who are the Satanic elite who rule the world. As I have said in numerous articles, the Illuminati pyramid on the back of the U.S. dollar is a template or occult blueprint for what is coming soon. The eagle which is really the occult bird, the Phoenix, is a symbol of the new world order rising from the ashes of chaos. The Illuminati slogan is, “Order Out of Chaos.” The rock’n’roll band, Led Zepellin, sang their famous lyrics, “Is the new world rising, from the shambles of the old?”
All of the chaos we see in our society is essentially manufactured. It is designed to lead us into the new world order. The dollar is deliberately being devalued in order to bring in a new world currency called the “Phoenix.” The occult-based elite hope to do this by 2018.
So the question is after reading this, “What can you do about it?” The person under mind control automatically says, “nothing.” But the spirit that God placed in man and the Spirit of God itself says “All things are possible.” God knew before the beginning of time about the chaos that is happening now. He downloaded into the human consciousness everything that is needed to overcome the spiritual darkness. God knew before the beginning of time that you would be here for such a time as this.
That means you came into this world to fulfill a purpose and that purpose is not to be a slave in the occult-pyramid system. In addition you must know that He has given you the opportunity to use Hispower to overcome evil. When that power is accessed by belief you then become a carrier of an energy force that is more powerful than anything in the Universe. What is called the First Great Awakening, tapped into that power and transformed America at its birth.
A Third Great Awakening is a release of cosmic energy from another dimension where the Personal God rules. Through belief and turning to Him as the Source, men and women can call down supernaturalpower from this dimension or invisible realm. In our nation today, it is scientifically possible to release what is called the dunamis, from which we get our word dynamite. When this all-powerful explosive force is released in the invisible realm, it sends a shockwave of power so strong, that entities called thekosmokratos are overwhelmed. Therefore it is possible to enter 2013, not as a victim, but as a conqueror. The choice is yours.
December 29th, 2012 by olddog
Jim Willie is always at the top of my list of important reads. This one is exceptionally good and discusses what appears to be the new flow of the tides of fortune. I believe the U.S. dollar is being isolated – and I believe it’s one thing the egos of the high and mighty just can’t bring themselves to perceive and, thus, prepare for it. This is one of Willie’s best columns, in my opinion. Marilyn Barnewall
Jim Willie: The Coming Isolation of the USDollar
December 27, 2012 By The Doc
By Jim Willie, GoldenJackass.com
The typical human reaction to any infection, vermin, danger, or toxicity is to stand back, to isolate the agent, to trap it, to prevent its further spread or release, then to remove it in a safe secure way if possible using trained professionals. Eventually decisions must be made on the level of acceptable risk on the removal, like what is willing to be lost or damaged or killed in the process. Risk analysis, cost trade-offs, and minimization decisions must be evaluated and executed. The toxic agent in global trade, global banking, and global bond market is the USDollar. In 2009, the Jackass began making a certain firm point. Those nations that depart from the entire USDollar system early will be the leading nations in the next chapter, with stronger foundations, richer solvency, emerging economies, healthier financial markets, efficient credit engines, growing wealth, stronger political helm activity, and better functioning systems generally. Imagine a contaminated blood system that infects, corrupts, and destroys all interior organs from the spread of the toxin. Those nations that stick with the crumbling USDollar system stubbornly will find a horrible fate with devastating effects, rampant economic damage, broken financial markets, sputtering credit engines, tremendous loss of wealth, wrecked supply lines, poverty spreading like wildfire, ruined political structures, social disorder, isolation from the rest of the world, and a fast ticket to the Third World. That is EXACTLY what is happening in the last several months. A division has begun, as the East has been busily installing the next generation platforms, as related to trade, banking, and commercial integration.
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NEW ASIAN TRADE ZONE
The division between East and West actually accelerated when the extremely ill-advised decision for Iran sanctions was made by an increasingly desperate United States Govt and its handler on the Southern Med. The division continues, matures, and develops with each passing month. It has become a story, as the Eurasia trade zone concept has been born. It has a long way to go, but Asia however has made great strides lately in unifying commerce. The climax event of the Asian trade zone conference held in Vietnam could not have been more important, as they rejected the US-led plan. The Asians partners and players even rejected the United States from the entire Asian trade zone, but did include Australia and New Zealand. The incredibly stupid naive US-led plan, the Trans-Pacific Partnership, attempted to create a trade zone with Asia which would have blocked China. Imagine the incredibly obtuse blockheaded maneuver of trying to have all of Asia not conduct facilitated trade with China, its leading trade partner. Talk about shooting both legs and genital region with a double barreled shotgun! This is the signal flare of US political stupidity that has turned highly destructive for the USEconomy and its people. Such failed leadership and counter-productive initiatives will push the US into the Third World even faster than previously thought possible. The isolation is firming quickly. Most of Asia does not wish for strong trade ties with the United States, most likely since they do not see mutual benefit. They see a ravaging appetite to grab capital.
A Paradigm Shift is taking place, and the ASEAN-China summit gave proof positive in a seminal event of the vast changes in progress. The United States just suffered its worst humiliation ever as a nation on the Eastern global stage. It was exceeded only by the humiliation for a US president personally. The story went uncovered by the lapdog inept US press. The late November Asian summit meeting held in Phnom Penh included 15 Asian nations, which represent half the world’s population. They decided to form a Regional Comprehensive Economic Partnership that excludes the United States. The Asians are pushing to isolate the United States. Regard it as punishment for hegemony, or a reaction to prevent further capital drainage, or to protect from central bank abuse, or to wall off continued bond fraud export, or to defend against military aggression. Regard it as confirmation that China is the regional leader in Asia, even for military security. Regard it as a response to banker criminality, or simply for being totally full to the brim of American corruption and arrogance and abuse of position, led by creation of the USDollar as an elaborate weapon and credit card whose balance is never to be repaid. Abuse of power and sponsored financial corruption will have extreme consequences in the reshaping of global commerce and banking. The US will be isolated, so as to protect the rest of the world from its fascist exhibitions and deep manifestations.
The shift is in progress, and the American people have no idea what is happening. They are too pre-occupied by the agency torture of the population, urgently needed to remove guns and to create the police state. Current events are heinous and genocide on large scale and small scale. Any comments will be limited on the orchestrated travesty, travails, and tragedy. They all have one traceable element, which connects to a certain Virginia suburb where an intelligent pillbox operates in the shadows with puppet strings to the press networks and maybe Hollywood. The security agencies turned to the dark side years ago, with full devotion to narcotics, money laundering, and collusion with the castle dwellers. When the Praetorian Guard plots to bring about a police state, the only words that come to mind are disaster, disorder, mayhem, betrayal, degradation, death. Their tools are psychotropic drugs, violent training, weather altering devices, and basic sabotage. Treason is the calling card unfortunately for much of the US leadership class, whether banking, politics, economics, pharmaceuticals, or news networks. Think Syndicate, as my work has described for several years. The United States with its harsh new visa policies, molestation at airports, heavily defended borders, sponsored gun running, has shown a vicious visible visceral fascist streak that has begun to bring memories of the national socialists of Central Europe 70 and 80 years ago. They are back, stronger than ever, not having been eliminated. They were instead assimilated within the banking and security organizations, able to plant seeds which germinated with the sons in offspring. Two sons became presidents.
DEUTSCHE MARK GONE
In the 1960 and 1970 and even 1980 decades, the favorite currencies off the standardized tables of commerce were the USDollar and DeutscheMark. At one time in the Soviet Union and the Soviet Bloc of Eastern Europe, more USDollars and DMarks were in circulation than official Russian Rubles or Polish Zlotys or Hungarian Forints or whatever. Those years are long gone, as in long gone, all paper alternatives lousy. Under a strange bizarre compromise arranged to assimilate East Germany and to conceal the French sovereign debt, the Euro Monetary Union and the common Euro currency was born. It is now in the process of disintegrating. So the powerfully strong and stable German DMark went away. Back in those decades, only limited travel was done by the Jackass, confined to a honeymoon in France and Switzerland with a cold woman no longer inflicting her plague-like touch in my life. The Jackass deals exclusively in Latin currency of paper and human variety. No exposure to alternative currency held under the table was discovered in beach locations to the south or modest hotels in the green hills to the north. But friends reported stories. My older brother spent two months in Germany and Czechoslavakia, with ample stories of hoarded USDollars and DMarks. Store owners and wise families were eager to obtain USD and DM currency, even young kids. He and some ambitious friends heard stories of vast black market activity in Russia, where the US$100 bill was a favorite. In that era, Gold was not an item of pursuit or stored wealth. Times have changed radically, and Gold is the new store of value.
Times have changed with the sunset of the DMark and the toxicity of the USDollar. The people, the shop keepers, the business men, the small financial firms, they all have been turned upside down in recent years as they struggle to find a safe place to store wealth. Money has been corrupted. The purveyors of money have lost control by accelerating its supply by central banks, lost control of bank solvency, lost control of anything remotely acting like an honest tether to money itself. As a result, all those people, the shop keepers, the business men, the small financial firms, have been discovering Gold & Silver bars and coins. Their combined actions have resulted in an implicit isolation of the USDollar, even an isolation of the Southern European sovereign debt. Swiss havens have grown, in parallel with Gold havens. The toxic monetary plague has been identified, and its toxic sources too. They are the US Federal Reserve and the Euro Central Bank. They are ruining money, undermining wealth, and destabilizing the entire world related to wealth, banking, commerce, and economies. The armies of people, the shop keepers, the business men, the small financial firms, are working to isolate the USDollar as toxic agent in a demonstration of survival.
FREEDOM FROM DELUSION
Many bright people within the gold community cling to hope, harbor delusions, and maintain expectations, none of which have much value in the fast changing world of fascist entanglement and full integration. The Jackass has operated without delusions, firmly in belief that the corrupt systems would flourish. That viewpoint and operating principle has proved to be correct since 2004 when the Hat Trick Letter began to spout deeply disturbing forecasts. One after the other, most of the forecasts have indeed occurred, to the detriment of the nation and its systems and its society at large. No pleasure has come from forecasting a wrecked housing market (burdened by lax underwriting and bond fraud) or a broken insolvent banking system (from bond losses and dependent upon money laundering) or a desperate chronically USGovt budget (dragged down by adopted socialism and sacred war costs) or a spreading Southern European bond crisis (addressed only by higher subordinated toxic paper).
No pleasure is taken from seeing vast legions of struggling Americans, including a few close friends, who have lost jobs, lost homes, lost savings, lost pensions, and lost a valuable sense of security, as they continue to hang on. Many might actually find the warmth of the official camps, only to disappear later on. Argentina and Chile had their desaparecidos, and so will the United States. My ugly expectation is that before their bodies are incinerated, vital organs will be extracted for black market gains. Inoculations upon entry will assure them of good health and fully functioning organs. Later, vaccines will infect them, just like with the swine flu vaccine. By the way, in Costa Rica a brief story to enlighten on vaccines. In early 2008, the Jackass advised a couple families with numerous children and cousins in school to reject the swine flu vaccine that was promoted by the school authorities at the urging of US officials. They took my advice after their confidence was won on several other matters. Only one of about 20 children took the vaccine. She has been sick with a mysterious cerebral disease for over two years. My mention of searching for Guillain Barre symptoms has not helped. The mothers are grateful, as they did not understand at first my emotional outburst to discourage following the school advice. The official US camps will involve forced vaccines. Later on, false stories will be promulgated that the dead bodies were the result of already sick people entering the camps for quarantine purposes. In reality, the people would only have suffered from hunger and exposure and despair.
Hope is not part of my forecasts, but rather the reality of the corrupt human power game mindset. The US banking, economic, and political leaders can easily be expected to continue their corrupt games, with easy forward calls. No expectation of USGovt regulatory agencies is part of my forecasts, but rather the reality of their nearly perfect track record of big bank loyalty and fraud protection. The US regulators can easily be expected to continue their corrupt games, with easy forward calls. Clinging to precious metals mining stocks is not part of my forecasts, a decision made back in early 2008. They are bound in paper wealth, subject to inflation in share dilution just like the USDollar, vulnerable to jurisdictional confiscations, and at the mercy of labor unions whose production is increasingly halted. Unfortunately, too many fine people within the gold community, including GATA, hold firm on hope, regulators, and mining stocks. Not here! The major financial networks rely upon advertisement revenue from Wall Street, fund managers, an market exchanges. GATA has a business model that has one key vulnerability, with strong links to the mining firms. It has tainted their viewpoint sadly. My support of GATA is firm on challenge of USDollar legitimacy before the Supreme Court, on challenge of US regulators to enforce the law, on challenge of the big banks to prove their solvency, on challenge of the central bank to reveal their activity. But the Jackass does not expect the Supreme Court to ever rule the USDollar as illegal, nor the US regulators to ever enforce the law, nor the big banks to ever remove themselves from corruption, nor the central bank to ever conduct business in opposition to the biggest banks under supranational orders.
My personal background has taught me well that a corrupt system never corrects itself. Instead, it spins out of control with broken platforms, layered mechanisms to impose its servitude and influence, complete with side projects to illicitly support itself. See the theft of Iraq gold and theft of Libyan gold. Their people will never again see that wealth. The US system will remain broken until it collapses, never to be corrected until after its collapse.
The Jackass does not align with the expectation of mining stock rise. The stocks are paper wealth in a new era of paper wealth implosion, during which inflation of shares through dilution is rampant. My full expectation is for physical metal prices for Gold & Silver to rise, while mining stocks continue to fall in value from dilution and reduced metal output. The leverage is a mirage when large deposits are seized by desperate foreign governments in need of income. What on earth is complicated about understanding this point?? The leverage is a mirage when workers are the focal breakdown point for a higher cost of living. If workers cannot afford to feed their families and survive, mine output will suffer. What on earth is complicated about understanding this point?? The leverage is a mirage when rising mine operation costs must be handled, by the simple practice of share dilution. Combine with regular executive stock options, and the dilution on stock shares is huge. What on earth is complicated about understanding this point??
POWERFUL CORRUPTION INERTIA
Corruption Inertia is a principle firmly believed in when Jackass forecasts must be made. The corruption will continue with firm immutable momentum, without an external force acting as agent of change. At times, this is simple science. When colleagues introduce hope and what must be, the OFF button is engaged quickly here in my office. Their views are out of touch with reality. Corruption will persist as long as the Syndicate continues to hold power. It will remain the constant while the USDept Justice remains, while the USDept Treasury remains, while the US Regulators remain, even while the US debt rating agencies remain. They all support the current system. They are all subject to momentum pressures. Only an external force will result in change. When the USDollar is further isolated, that change will come. To expect change from the inside due to internal forces is lunatic, kind of like expecting an alcoholic to change on his own from an awakening. Al Capone was removed not from inside the Chicago crime boss conference of dons. He was brought down by external forces related to income tax. The world will similarly reject the USDollar for its tax on the system, unwanted, discarded as a toxic agent.
PROTECTION FROM THREAT TO WEALTH
Again, delusion works well when fashioning a creepy little shell of existence to protect oneself from the psychological damage of a predatory government syndicate or security agency apparatus. The Jackass mocks such defense mechanisms, since a guarantee for poverty and misery. The vast legions of Americans will soon awaken to find their jobs are hanging by threads, their wealth either vanished or converted to USTreasury Bonds by force, their liberties long gone, and their ability to seek out foreign lands for residence curtailed. In fact, one nation after another is actually banning acceptance of Americans for bank accounts. See Switzerland, Panama, and Hong Kong. The US subjects are seen as persona non grata not for their own characteristics, but for the passport they hold from the United States. The USGovt as lord acts like syndicate bullies, agents to abuse embassy privileges, with imposed extra legal paperwork like an extra burden. The isolation is not only of the United States, but of its citizens, whose business is not desired. Hence the Americans will increasingly be trapped in the US along with their money. The Jackass response to threat is not to embrace delusion, and not to seek a blanket to cover my head in the basement quarters. Instead, the response has been to head for the hills with pockets filled.
People, both clients and colleague, inquire when the Gold price will rise with vigor, when the mining stocks will rise with gusto. They remind that with all the central bank debasement of currency from Zero Interest Rate Policy and Quantitative Easing, the ultra-cheap, artificially cheap, desperate cheap money to finance USGovt debt should make the Gold price zoom upwards with each QE official announcement. My answer is quite simple. Each new QE program gives the dark forces more motivation to slam the gold price with naked shorts in sale of paper gold and paper silver. To be sure, the true value of Gold and the true value of Silver is higher, but it is not reflected in the COMEX price. That market is the epitome of corruption. If they were in charge of measuring fevers, they would place the thermometers on ice. Instead, a vast divergence comes between the paper Gold price and metal Gold price. Unless and until the Gold market is freed from corruption and freed from the shackles of Wall Street and London and Swiss influence, it will continue to be suppressed. My full expectation is not for the system to correct itself from within. Instead, the COMEX seeks out new sources of supply, like the GLD Exchange Traded Fund. It is probably far more gutted than publicly stated. It has been converted into a bullion bank central repository for easy raided inventory. The Gold price will not rise from internal forces to push up value, in response to central bank monetary policy or shortage of COMEX inventory. The Gold price will rise from external forces in USDollar isolation, along with isolation of the big banks in the US and London. Their gold inventory will be removed, returned, and drained. In time, the USDollar will widely be rejected in trade.
THE NEW ISOLATION HAS BEGUN
The process of isolation is not just now beginning. It is a process well along. In fact, it has been told that immediately following the Lehman Brothers death (a deliberate exploited execution) and the adoption of toxic vats by the USGovt in the form of Fannie Mae and AIG, the major foreign players located primarily in the East began to feverishly prepare for new platforms on trade and banking. They sought to develop an alternative. For the last 20 to 25 years, a backwards principal has been at work. It dictated that the USDollar would prevail in reserves management, actually the USTBond as vehicle. The rules for trade surplus recycle were constructed to lean toward usage of the USTBonds. Therefore, the global trade would be dominated by USDollars. In other words, banking would dictate trade settlement. That is backwards, and keenly exhibits the brute force of the USDollar hegemony. Also the crude oil payments have been standardized in USDollars, ever since the Saudis cut a major deal with the USGovt and UKGovt in the mid-1970 decade after the famous embargo. Protection came to the Saudi regime and Persian Gulf emirates, in return for exclusive USDollar payment on trade for oil. The Petro-Dollar defacto standard is the primary plank behind the USDollar global trade patterns shown for over three decades. It is coming to an end, a sunset.
IRAN SEMINAL EVENT
The Iranian sanctions put forth by the USGovt and adopted by the EuroZone nations have contributed more to unwinding the USDollar trade system than any event in decades. It sounded the death knell for the USDollar. It hastened numerous nations to seek a US$ alternative. It provided a fertile environment to fashion new trade settlement mechanisms. It pushed Turkey into acting as a gold bullion intermediary role in the provision of gold for usage in trade settlement. See their role with India and Iran, fully described in the December Hat Trick Letter. When an independent highly reliable gold trader source was asked to confirm the role of Turkey as a test case in developing gold based trade settlement, he gave a tacit confirmation. He has mentioned Turkey in past conversations over the last couple years frequently. Just as Turkey was a swing nation in the NATO alliance against the Soviet Union, Turkey will serve in my view as a critical swing nation in the movement to create a non-US$ trade settlement system. The new system will be decentralized, meaning not funneled through the major banks, not passing through the USFed as clearing house. Turkey will be essential in the formation of the Eurasia trade zone. First comes the Asian trade zone (the US excluded), and next comes the hand shake between the Asians and Europeans to create Eurasia. Some folks have expressed doubt toward the arrival of a vast trans-continental trade region. They seem painfully unaware of an incredible network of railway lines connecting Russia to Germany and China, and of a incredible network of liquified natural gas lines connecting Russia with all of Europe and Central Asia. Across the new trade zone and its diverse commerce, the USDollar will not be at the center. It is in fact being isolated, since it is a toxic agent. Everything US$-based is crumbling, from currencies to bonds to banks to credit lines to economies.
CHINESE YUAN BILATERAL CURRENCY SWAPS
The advent of barter has come. It has not been noticed by the incredibly distracted, misled, deceived, poorly trained, mentally challenged, and myopic American public. They read about a currency swap accord, give it no emphasis or importance, and then turn to the fund manager opinions on rotating stocks from one sector to the next. They read about a workaround to the Iran sanctions, express some puppet-like response of anger or disgust, and then turn to IPOs and stories on Google, Apple, and Facebook shares. They do not even read about the failed Trans Pacific Partnership, since it did not make it onto the financial pages. Sadly, the Jackass is slowly adopting a cold view that vast swaths of the US populace will suffer from a Darwinian event. Their home equity has vanished. Their job security has vanished, unless they work for defense contractors. Their pension funds have been damaged. Their wealth has been over 90% dedicated to paper securities in very obedient fashion. The great majority has dismissed the arguments for sound money or gold investments. Some have a pitifully small portion devoted to hard assets like perhaps some energy companies. Only those who adopt a Gold strategy will survive the powerful storm underway, as it intensifies. Great wealth is being destroyed, and only Gold & Silver will enable that survival by the construction of lifeboats. Paper wealth is being blown away, as only hard metal assets will prevail. Add energy and farmlands.
When people ask about the best allocation, my standard response is at least 90% precious metals, the rest to energy deposits, but not actually stocks, perhaps farmland if possible. The best diversification in my view is for laddering of silver purchases, starting at $10/oz and moving to $15/oz then $20/oz and finally to $25/oz with continued accumulation at $30/oz and above. Gold will win the monetary war, but Silver will take the greatest gains. Gold is fine for a more stable long-term protection against toxic paper wealth, but my ongoing objection is that the New York, London, and Swiss syndicate centers play too many games. Silver is subject to global shortages, vast industrial demand, non-replaceable usage, and a much more dangerous situation that the powerful dark forces cannot manage. Silver coins will be widely used in commerce, while Gold bars will thrive in banking transactions. Besides, killing werewolves is the zinger factor with silver bullets.
China has made numerous bilateral swap accords with other nations. As the label indicates, they are deals cut between China and another nation to freely use Chinese Yuan from a credited account that will retain equilibrium. So far many nations have signed up and even renewed deals. The list of nations includes Brazil, Russia, Japan, and India. One might be correct to include all of Asia on the list, as nations like South Korea and Taiwan and Vietnam freely trade in Yuan transactions. The first major signal that the bilateral swaps have taken hold sufficiently to undermine the USDollar through a new trade foundation will be the complete arena of Asian trade being conducted in Yuan transactions. They have no need for USDollars in trade. They see their USTBonds held in reserves under management as vulnerable to serious loss. They see their USTBonds held as subject to grand debasement from USFed central bank monetary policy itself. They see their USTBonds held as supported by Weimar machinery in hyper-drive. They see their USTBonds held as part of a corrupted Wall Street arena and its vast trappings. They see their USTBonds held as prisoner to the USGovt debt battles and a potential crush victim on a fall from the fiscal cliff.
The Chinese bilateral swap accords are actually barter deals. They often represent rather balanced trade, unlike with what the nations have set up with the United States. Unless nations purchase enormous lots of military hardware, they have little need for US products. Hence the end result is a bigger batch of toxic USTBonds to purchase in order to balance the accounts and to avoid the local foreign currency exchange rate from rising enough to damage their export trade. The bilateral swap accords work to create numerous two-way ties as part of a latticework that eventually will form a transnational fabric without the USDollar as nuclear cores in each connection weld. The bilateral swaps are barter without the name in a direct confrontation against the USDollar and its catbird seat. That seat, once a throne, is being dismantled. The latticework of bilateral swaps has created the critical mass of a global blanket with no centralized control room, no choke points with bank transactions, no SWIFT code ticket taker. The bilateral swap accords work to build a critical mass that isolates the USDollar from an entirely new foundation for trade. The USDollar is being isolated.
COMEX PRESSURE POINT
The COMEX is under constant unrelenting pressure. They must shift around ill-gotten precious metal inventory in order to avoid a default. That would be embarrassing. The main device for maintaining order at the COMEX continues to be naked shorting of futures contracts, a blatantly corrupt practice. The naked short ambushes occur with greater frequency in recent months. The arrival of Scotia Mocatta as a provider of gold supply and naked short commitments will kill them eventually, as they have made a deal with the devils. The overnight dispatch of silver from the US to London has grown enormous. One can only suspect that the raids of GLD gold inventory and SLV silver inventory is much greater than is estimated even by its most ardent critics. The illicit sources for COMEX precious metal are fast drying up.
The new wrinkle to render damage to the COMEX is the arrival of the Shanghai Gold Exchange. The graphic displays the differential, a basis for potential arbitrage. Complex arrangements can be constructed that take advantage of the differential, basically buying the gold metal in New York, finding a way to make it available in Shanghai, where it is sold at a $20 to $30 higher price. The end result of the arbitrage is high volume drainage of gold in New York. The snapshot below is taken from December 7th. Several other snapshots are available, with similar price spreads. Finally COMEX based in New York, a major nucleus of corrupt financial markets, has some competition. Expect the spread to widen, the opportunity for arbitrage to grow, and pressure to build for a breakdown.
Sadly for the evil camp, they are fast running out of sources. They stole the entire MF Global private accounts, denied the clients their legal right to receive silver in delivery, and received legal protection by the USGovt and Appellate courts, after changing the law applied to financial firm liquidation instead of brokerage firm liquidation. It was a blatant maneuver that has depleted the COMEX of a major slice of legitimate business. The subsequent similar raid on PFG-Best had an echo effect, adding to the removal of COMEX clientele. The end result is that the risk hedge trade is finding ways to conduct their business without use of the indescribably corrupt COMEX. So the COMEX is being isolated in risk hedging just like the USDollar in global trade.
The upcoming Petro-Dollar sunset has very uncertain timing indications. The assassination of Prince Bandar in Saudi Arabia, followed by the potential incapacitation of King Abdullah could work to weaken the foundation of the Petro-Dollar itself. Back in April 2010, the Saudis and other main Persian Gulf nations struck a deal with Russia and China for protection in the gulf region. That accord was not given much emphasis anywhere, nor publicity. But to the Jackass, who had a source at the meeting, the event signaled the sunset of the Petro-Dollar defacto standard. The Saudis would turn to Asia for protection and security, at a time when their crude oil trade was growing with Eastern nations, and when the North American production was made more available for the US demand in markets. The day is nigh where the Saudis accept non-US$ payments for crude oil. They might first accept Chinese Yuan, then Japanese Yen, then Korean won, then Gold itself through big Turkish bazaars. The Petro-Dollar is being isolated for sunset, and will be a key event is the removal of the USDollar as center for global trade settlement. Also, the Saudi regime in my view does not have much longer to survive. Numerous companies and financial firms and export facilitators have exited from the United Arab Emirates in preparation for the fall of the House of Saud. The Saudi Arabian royals have unstable neighbors in every border, especially Bahrain, Iraq, and Yemen.
WILD CARD FACTORS
Numerous wild cards float on the global trade table. Bank strictures head the list, with imposed rules on account reporting abroad, with tax information requirements, and with capital controls. It is harder each month to move large amounts of funds. The forms to complete have become onerous and imposing, acting like implicit restrictions. It is harder each month to use simple bank cards at ATM machines. With a simple rule change, the banks cannot complete these transactions. The organized and patterned restrictions work to trap USDollars within the local US borders. Consider it an internal mechanism to assist the global isolation of the USDollar.
LOST GLOBAL RESERVE STATUS
The described isolation on numerous fronts, whether trade or COMEX or banks, all work toward the elimination of the toxic agent in the USDollar. The world wants a more just, more functional, more efficient, more equitable global trade system. The United States has abused its global reserve custodian position too long. The world is fighting vigorously to remove it. The usage of the USDollar as a credit card to finance its consumption binge without ability to pay will come to an end. The usage of the USDollar as a device to enable powerful aggression in war to advance syndicate interests like vertically integrated narcotics will come to an end. The usage of the USDollar as a banking monopoly device will come to an end. The usage of the USDollar as an instrument for bond fraud will come to an end. The usage of the USDollar as a free lunch device to finance the USGovt deficit will come to an end. When the USDollar is no longer the global reserve currency, the door to the Third World will be opened wide. When the USDollar is no longer the global reserve currency, the supply lines will be interrupted to the USEconomy, giving off a prominent Third World stench. When the USDollar is no longer the global reserve currency, the price inflation effect will become a national topic of grand debate and extreme anger. When the USDollar is no longer the global reserve currency, the United States as a nation will experience tremendous additional isolation and hardship, as most Third World nations do. The level of corruption within the USGovt and US banking corner offices is already far more entrenched than any Third World nation. The vote fraud for US national elections is equally prevalent, but more sophisticated.
When the USDollar is no longer the global reserve currency, the Gold Standard will be right around the corner, if not already in the implementation stage. The Gold price will react quickly to the removal of the USDollar from its prized perch of abuse. The center of the new trade settlement system will be GOLD, which is not even being discussed by the enlightened denizens of the gold community. It will be the basis of the Letters of Credit, in the form of gold trade notes. The short-term credit that facilitates trade will have a truly magnificent grand Gold core. The common agreement will be to make the Gold price at least $5000 per ounce, probably closer to $7000 per ounce. They will in the process dismiss, overrun, and put into oblivion the COMEX and the LBMA, rendering them to the scrap heap of irrelevance.
THE HAT TRICK LETTER PROFITS IN THE CURRENT CRISIS.
From subscribers and readers:
At least 30 recently on correct forecasts regarding the bailout parade, numerous nationalization deals such as for Fannie Mae and the grand Mortgage Rescue.
“A Paradigm change is occurring for sure. Your reports and analysis are historic documents, allowing future generations to have an accurate account of what and why things went wrong so badly. There is no other written account that strings things along on the timeline, as your writings do. I share them with a handful of incredibly influential people whose decisions are greatly impacted by having the information in the Jackass format. The system is coming apart on such a mega scale that it is difficult to wrap one’s head around where all this will end. But then, the universe strives for equilibrium and all will eventually balance out.”
(The Voice, a European gold trader source)
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Jim Willie CB is a statistical analyst in marketing research and retail forecasting. He holds a PhD in Statistics. His career has stretched over 25 years. He aspires to thrive in the financial editor world, unencumbered by the limitations of economic credentials.
December 26th, 2012 by olddog
TRUTHER DECEMBER 26, 2012 1
Will this be the last normal holiday season that Americans ever experience? To many Americans, such a notion would be absolutely inconceivable. After all, in the affluent areas of the country restaurants and malls are absolutely packed. Beautiful holiday decorations are seemingly everywhere this time of the year and children all over the United States are breathlessly awaiting the arrival of Santa Claus. Even though poverty is exploding to unprecedented levels, most families will still have mountains of presents under their Christmas trees. Of course a whole lot of those presents were purchased with credit cards, but people don’t like to talk about that. It kind of spoils the illusion. Sadly, the truth is that our entire economy is a giant illusion. The extreme prosperity that we have been enjoying has been fueled by debt, and any future prosperity that we will experience is completely dependent on our ability to go into even more debt. The total amount of debt in our economy is almost 10 times larger than it was just 30 years ago, but we don’t like to think about that too much. Most Americans are way too busy living the good life to be bothered with “doom and gloom”. Well, get ready to say goodbye to normal. As history has shown us, no financial bubble lasts forever, and time is rapidly running out for us.
You know that the hour is late when even mainstream news sources start publishing articles with titles such as this: “Will 2013 Mark the Beginning of American Decline?“
That article appeared on Bloomberg.com the other day, and it was written by Simon Johnson, a former chief economist at the International Monetary Fund. He is convinced that a day of reckoning is coming for U.S. government finances, and he seems resigned to the fact that we will not be ready when that day arrives…
“Sooner or later, it will be America’s turn to fall out of favor with investors and to see its own interest rates rise. It is hard to know when that day will come, or precisely what pressures the country will face.
Let me only venture one forecast: We will not be ready.”
Other analysts are far more pessimistic. For example, the following is what Gerald Celente said about the “bond bubble” during a recent interview with King World News…
Eric King: “Gerald, I wanted to take a look at this upcoming issue you have coming out. (In here it says,) ‘Bonds Away! The bond bomb is ready to explode … threatening to make the real estate and dot-com bubbles, and even the Great Recession, look like market corrections.’ Can you talk about that?”
Celente: “Yes. This piece is being penned by Dr. Paul Craig Roberts, the former Assistant Treasury Secretary under Ronald Reagan. And he is convinced that the bond bubble is about to burst. This cannot continue to go on the way it is. Everyone knows that the whole game is rigged, and so is this….”
“The whole game is rigged. It’s ready to go down, and Dr. Paul Craig Roberts believes it’s ‘Bonds Away’ in 2013 as the bond bubble explodes and brings about a financial disaster even worse than the Great Depression.”
Eric King: “He’s saying here it’s a road to financial collapse that we are going to head down when this thing bursts.”
Celente: “It is. Because the whole world is being propped up by these phony bonds and it’s going to collapse. It has to happen. Interest rates are going to start going up, and when they do the bond bubble explodes. You cannot keep interest rates at zero for this amount of time and expect anything other than disaster to follow.”
For much more on all this, you can listen to another excellent interview with Gerald Celente right here.
Our politicians just assume that we will be able to borrow trillions upon trillions of dollars far into the future at super low interest rates, but that is a very dangerous assumption.
As I noted the other day, the average rate of interest on U.S. government debt was 2.534 percent at the end of November. If that number just rose to where it was about a decade earlier we would be in a massive amount of trouble.
Back in the year 2000, the average rate of interest on U.S. government debt was 6.638 percent. If we were at that level today, the U.S. government would be paying out more than a trillion dollars a year just in interest on the national debt.
But our politicians just keep borrowing and spending as if we could do this forever.
From the time that George Washington was inaugurated (1789) to the time that George W. Bush was inaugurated (2001), the U.S. government accumulated about 5.7 trillion dollars of debt.
During the first four years of the Obama administration, the U.S. government accumulated about 5.7 trillion dollars of debt.
How can anyone support this kind of insanity?
You can see an excellent video demonstrating the vastness of our national debt right here. In the end, all of this debt will absolutely destroy the U.S. dollar, our economic system and the bright futures that our children and our grandchildren were supposed to have.
As if all of that was not enough to be concerned about, there is also the threat that Wall Street could implode at any time. Most Americans have no idea that Wall Street has been transformed into the largest casino in the history of the world. The “too big to fail” banks are the ringleaders, and the derivatives bubble hangs over our financial system like a “sword of Damocles” that could fall at virtually any moment.
Everything will remain fine as long as the spiral of derivatives that our bankers have constructed remains perfectly balanced. But if something happens and it becomes unbalanced and starts to collapse, the consequences could be unlike anything we have ever seen before.
A recent Zero Hedge article entitled “1000x Systemic Leverage: $600 Trillion In Gross Derivatives ‘Backed’ By $600 Billion In Collateral” detailed how there is barely any collateral backing up the hundreds of trillions of dollars of derivatives that are out there…
But a bigger question is what is the actual collateral backing this gargantuan market which is about 10 times greater than the world’s combined GDP, because as the “derivative” name implies all this exposure is backed on some dedicated, real assets, somewhere. Luckily, the IMF recently released a discussion note titled “Shadow Banking: Economics and Policy” where quietly hidden in one of the appendices it answers precisely this critical question. The bottom line: $600 trillion in gross notional derivatives backed by a tiny $600 billion in real assets: a whopping 0.1% margin requirement! Surely nothing can possibly go wrong with this amount of unprecedented 1000x systemic leverage.
Our entire economy has become a giant pyramid of debt, risk and leverage. At some point there is going to be a giant crash. When that happens, people are going to become very desperate.
When people become very desperate, they often accept “solutions” that they were not willing to consider previously.
We need to learn some lessons from history. This is exactly the kind of thing that happened back in the 1930s.
For example, an elderly woman named Kitty Werthmann is telling audiences what life was like in Austria back in the late 1930s…
“In 1938, Austria was in deep Depression. Nearly one-third of our workforce was unemployed. We had 25 percent inflation and 25 percent bank loan interest rates.”
“Farmers and business people were declaring bankruptcy daily. Young people were going from house to house begging for food. Not that they didn’t want to work; there simply weren’t any jobs.”
The Austrian people were really hurting and they were desperate for answers. When Hitler came to them with “solutions”, they were ready to embrace him with open arms…
“We looked to our neighbor on the north, Germany, where Hitler had been in power since 1933.” she recalls. “We had been told that they didn’t have unemployment or crime, and they had a high standard of living.”
“Nothing was ever said about persecution of any group – Jewish or otherwise. We were led to believe that everyone in Germany was happy. We wanted the same way of life in Austria. We were promised that a vote for Hitler would mean the end of unemployment and help for the family. Hitler also said that businesses would be assisted, and farmers would get their farms back.” "Ninety-eight percent of the population voted to annex Austria to Germany and have Hitler for our ruler.”
“We were overjoyed,” remembers Kitty, “and for three days we danced in the streets and had candlelight parades. The new government opened up big field kitchens and everyone was fed.”
Sadly, America is already starting to go down the same path in many ways. If you doubt this, you can read the rest of her account right here.
Right now, things are still relatively good in America. Yes, there are a whole host of economic numbers that look really bad, but what we are experiencing right now is nothing compared to the horrific economic pain that is coming.
When our economy finally crashes, nobody is going to be able to press a button and restore things to how they were previously. We will be told that we have to “adjust” and consider “new solutions” to our “new challenges”. Someday we will look back on the good life that we were enjoying in 2010, 2011 and 2012 and wish that we could go back to those days.
So enjoy the relative peacefulness and prosperity of these times while you still can. A horrific economic collapse is on the way, and once it strikes none of our lives will ever be the same.
Michael Snyder’s post first appeared on his blog, The Economic Collapse.