Categories » ‘Debt Bubble’
June 25th, 2015 by olddog
Foundation of global government cemented with passage of secretive bill
June 24, 2015
One of the most devastating blows to US sovereignty since the country’s founding was dealt today as the Senate handed President Obama his Trans-Pacific Partnership victory.
Despite massive opposition from the American people, Tea Party Republicans and a majority of Democrats, Obama was granted fast-track authority by a 60-38 vote.
Sections of the TPP published by Wikileaks have revealed the treaty’s vast influence over multiple areas including individual rights, internet freedom and even the rule of law itself. Unelected corporate boards and the President can now wield unprecedented control over almost every aspect of human activity.
“If you read, write, publish, think, listen, dance, sing or invent; if you farm or consume food; if you’re ill now or might one day be ill, the TPP has you in its crosshairs,” Wikileaks’ Julian Assange wrote.
Secret TPP chapters regarding immigration also grant President Obama an even greater ability to erode the country’s Southern border.
“Obama will be able to finalize all three of the Obamatrade deals, without any Congressional input…” notes Breitbart.
The TPP, which covers 12 countries and more than 40% of the world’s economy, will place North America under the same global government structure as the European Union, where laws are increasingly crafted outside of public influence.
WAKE THE HELL UP AMERICA
The scumbags in congress/senate have just sold us out completely, and there is no possibility of recourse as there is no possibility of organizing a rebellion without secret communication. All of the brave men and women who have been warning you to take action will now be hunted down and disposed of. There is no active constitution or common law left, and the military has been sanitized of patriots. Even with my extraordinary vocabulary of foul verbal expressions I find myself unable to express how putrid this travesty of justice is. And the most horrible part of all this is the majority of Americans have not the courage to stand up and refuse to obey. America has just committed suicide with their complacency. They are just plain stupid, and congress/senate is full of the most degenerate sons of bitches on earth. I hope those bastards die of the most agonizing/painful disease known to humanity.
May 30th, 2015 by olddog
By James Holbrooks
On June 2 a federal judge will decide whether or not the 600-strong Mongols Motorcycle Club can continue to use their logo. Uncle Sam considers biker gangs to be criminal enterprises and wants to be able to go after them like they would any other. Patches are a big deal to clubs, and a win for the government would be a major blow to the Mongols. What’s more, a nasty precedent would be set. One the feds could use against other clubs in the future.
The Mongols are mounting a First Amendment defense, claiming a ruling against them would violate their right to free speech. They’re correct, of course, and in a world of absolute adherence to the Constitution the case would never go before a judge in the first place. But that’s not how the game is played. As we’ve seen time and time again, the nobility are more than willing to change the rules as they see fit.
If fact, in the realm of the government’s war on gangs, the tactic being employed against the Mongols isn’t even the most egregious, Constitutionally speaking. Take a look at what’s happening in Southeast Texas. Last week a Port Arthur teen—and alleged member of a street gang called Surenos 13—was sentenced to nearly a year in jail for violating something called a “gang injunction.” This is the first time the region has utilized this particular law enforcement tool and the teen is the first to be prosecuted under it.
Gang injunctions got their start in California in the 1980s. They were used to create so-called “safe zones” where gang members were forbidden from associating. The legal justification behind them is that gang activity constitutes a public nuisance and therefore violates the law. But these injunctions aren’t just about association. They can also prevent members from wearing certain colors or owning certain items or any number of other wholly arbitrary actions. Whatever law enforcement considers gang activity, essentially.
In the case of the Port Arthur teen, there was a grand total of 37 restrictions placed on him and eight other members of Surenos 13. Among them are bans on things such as staying out after 9:00 PM, possessing aerosol paint cans, and committing crimes. Yes, they actually made it illegal to commit crimes. The kid now in a cage was popped, in part, for the villainous offense of possessing a cell phone while operating a motor vehicle.
And therein lies the rub. Because it’s not illegal to have a phone in your pocket while driving down the road or to have a couple of cans of spray paint in your backpack or to do any of the other myriad activities these gang injunctions might happen to restrict. Well, crimes are illegal, I suppose. But that’s ridiculous on its face. Point is, under the Constitution we as free individuals are supposed to be left alone to do as we will, so long as we don’t harm others. Them’s the rules. Or so we were brought up to believe.
Actually, them’s more than the rules. The Constitution is supposed to tell us who we are. We’re supposed to tear up and grow warm with pride upon reading the words. We’re a great people, after all, born of a great yearning for freedom, and the words are the proof of it. And so on and so forth. Never mind the fact that no one alive today signed the thing and so the obligation to adhere to it doesn’t actually exist. If you choose to prescribe to the fabricated idea of what America is—and there are a great many of us who don’t—then everything, by necessity, hinges upon the Constitution.
So what does it say about us as a country when our political class continuously reinterprets its own founding document to suit the needs of the moment? More importantly, what does it say about us as a people who stand idly by as it happens? None of it…the wars of conquest abroad, the rising police state at home, the torture going on just about everywhere…technically, none of it is allowed to be happening. And yet here we find ourselves, caught between a Constitution-free zone and a free speech cage.
The First Amendment says we have the right to peacefully assemble. The Privileges and Immunities Clause of Article IV says we have the right to travel. They might as well tell us to go piss up a rope. Ask those nine members of Surenos 13 about it. Ask them about safe zones and curfews and restrictions on association. Or go ask the Mongols about patches and the meaning of symbols. While you’re at it, whip out the flag and see if you get any laughs. Because America as it stands today is a bad joke. And the Constitution is the punchline.
James Holbrooks is a professional writer and editor. You can find his work atHolbrooksWordsmithing.com where this article first appeared. Follow James on Twitter.
This article may be re-posted in full with attribution.
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May 28th, 2015 by olddog
By Martin Armstrong
I have been warning for some time that government was eyeing up pensions. The amount in private pension funds is about $19.4 trillion. The question that has been debated in secret behind the curtain is how to justify to the people taking that over. I have been warning that if this is seized by government, it will come after 2015 Just how that is to be accomplished was finally settled by the Supreme Court without any justification constitutionally.
The US Supreme Court ruled last week in the unanimous, 8-page decision in Tibble v. Edison holding that employers have a duty to protect workers in their 401(k) plans from mutual funds that are too expensive or perform poorly. That is simply astonishing since there is no constitutional requirement for even government to provide social benefits. The Supreme court held in HARRIS v. McRAE, 448 U.S. 297 (1980) it was explained that the constitution is negative not positive. There is no duty imposed upon the state to provide a program for that would convert the constitution from a negative restrain upon government to a positive obligation to provide for everyone.
If we take the fact that the constitution is NEGATIVE and was a restrain upon government, then this latest ruling is completely unfounded. Monday’s unanimous ruling sends a warning to employers that they now must improve their plans and it is now an obligation to project employees. This comes just in time for then the next step is government to seize private funds and prosecute employers who choose badly a fund manager. This fits perfectly just in time for the Obama administration’s next assault as they prepare a landmark change of its own by issuing rules requiring that financial advisers put the interest of customers ahead of their own. This creates a very gray area wide enough to justify public seizure of pension funds under management.
This ruling will have a dramatic impact upon investment management and we have already received calls asking about using our model for management purposes since it has one of the longest track records that can be verified in the industry. What this ruling imposes is a tremendous duty upon the plan fiduciary who must now back up his decision with proof. This may also have the impact of foreclosing new fund managers from entering the business since they will lack the track record.
Yet this decision is even deeper. It sets the stage to JUSTIFY government seizure of private pension funds to protect pensioners. When the economy turns down and things get messy, they are placing measures in place to eliminate money in and physical dimension, closing all tax loopholes, shutting down the world economy with FATCA, and preparing for the final straw of Economic Totalitarianism with the Supreme Court reversing its entire construction of the Constitution to impose a duty upon employers to ensure the 401K plans perform in a world where interest rates are going negative. You really cannot make up this level of insanity.
The message here is not that all 401(k)s are bad or too expensive. In fact, costs have fallen 30 percent over the past decade as more plan sponsors turn to low-cost passive investing options. But this can be highly dangerous for to lower costs they turn to government debt where there is no need for fund management decisions. Yes, when I did hedge fund management, the cost was 5% annually plus 20% performance. That cost went to staff around the world that had to monitor positions and the world economy on a 24 hours basis. You paid also NOT to trade for most losses took place when traders were bored are would trade to try to make money when there was nothing to be done. Our track record was the best ever in the industry with the lowest drawn down perhaps in fund management. But that risk reduction cost money.
Today, costs vary widely. Plans with more than $100 million in assets usually have total annual costs below 1% whereas the biggest plans usually are below 0.50%. In small plans, the costs can be as high as 2% today. The focus is now on cost – not performance.
Financial service companies can charge a range of management, administrative, marketing, distribution and record-keeping fees for 401(k) plans. Plan sponsors can assume the costs, but employees are paying at least 85% of all fees typically. It is true that most workers do not know they pay the bulk of the share of costs. A 2011 AARP survey found that 71% of retirement savers do not think they pay any investment fees at all. It is true that the fees make a huge difference in returns over time. However, this drive to lower costs has also lowered the quality of funds management.
The U.S. Department of Labor estimates that a 1% point difference on a current account balance of $25,000 will reduce total accumulations by 28% over 35 years, assuming average returns of 7% and no further contributions. The focus is all on these management fees without any consideration of the problem. Trying to manage money varies according to the size of the fund. The more you gather, often the lower the performance because the markets are not unlimited. You can pick up the phone and say “sell at the market” when you have a $100 million fund, you cannot do that with a $100 billion fund. So the management fee was also a means to reduce the number of clients and it was never a question of unlimited capacity to trade. The numbers on performance would decline with greater amounts of money under management for the manager lost flexibility.
The Supreme Court case clearly shows that lack of understanding of the industry yet the battle centered on the 401(k) plan’s use of retail-class mutual funds when less-expensive institutional shares were available. The difference between those classes typically is 25 basis points. This will now put pressure on large plans to cut costs further but will not have much impact on smaller plans. That is because big plans have the buying power to negotiate better deals but at the same time they are the easy target for lawyers making them much more attractive targets for litigation.
Cutting management fees to the bone may in fact set the stage for massive losses for many of the older better traders are now just resigning. The quality of the funds management is more likely than not going to decline noticeably.
Between the court ruling and the Obama administration’s push for stronger fiduciary rules send a strong message that government can much easier seize the pension fund management industry of course to “protect the consumer”.
Reprinted from Armstrong Economics.
May 1st, 2015 by olddog
How can there be any semblance of freedom when there are tanks in the streets, military encampments in cities, Blackhawk helicopters and armed drones patrolling overhead?
It was for this reason that those who established America vested control of the military in a civilian government, with a civilian commander-in-chief. They did not want a military government, ruled by force. Rather, they opted for a republic bound by the rule of law: the U.S. Constitution.
Unfortunately, with the Constitution under constant attack, the military’s power, influence and authority have grown dramatically. Even the Posse Comitatus Act of 1878, which makes it a crime for the government to use the military to carry out arrests, searches, seizure of evidence and other activities normally handled by a civilian police force, has been weakened by both Barack Obama and George W. Bush, who ushered in exemptions allowing troops to deploy domestically and arrest civilians in the wake of alleged terrorist acts.
Now we find ourselves struggling to retain some semblance of freedom in the face of police and law enforcement agencies that look and act like the military and have just as little regard for the Fourth Amendment, laws such as the NDAA that allow the military to arrest and indefinitely detain American citizens, and military drills that acclimate the American people to the sight of armored tanks in the streets, military encampments in cities, and combat aircraft patrolling overhead.
Making matters worse, we find out that the military plans to use southwestern states as staging grounds for guerilla warfare drills in which highly-trained military troops equipped with all manner of weapons turn American towns and cities in quasi-battlefields. Why? As they tell us, it’s so that special operations forces can get “realistic military training” in “hostile” territory.
They’ve even got a name for the exercise: Jade Helm 15.
Whether or not Americans have anything to fear from Jade Helm 15, a covert, multi-agency, multi-state, eight-week military training exercise set to take place this summer from July 15 through Sept. 15, remains to be seen.
Insisting that there’s nothing to be alarmed about, the Washington Post took great pains to point out that these military exercises on American soil are nothing new. For instance, there was Operation Bold Alligator, in which in which thousands of Marines and sailors carried out amphibious exercises against “insurgent” forces in Georgia and Florida. Operation Robin Sage had Green Beret soldiers engaging in guerrilla warfare in North Carolina. And Operation Derna Bridge sends Marine special forces into parts of South Carolina and the National Forest.
Yet if Americans are uneasy about this summer’s planned Jade Helm 15 military exercises, they have every right to be.
After all, haven’t we been urged time and time again to just “trust” the government to respect our rights and abide by the rule of law only to find that, in fact, our rights were being plundered and the Constitution disregarded at every turn?
Let’s assume, for the moment, that Jade Helm 15 is not a thinly veiled military plot to take over the country lifted straight out of director John Frankenheimer’s 1964 political thriller Seven Days in May, as some fear, but is merely a “routine” exercise for troops, albeit a blatantly intimidating flexing of the military’s muscles.
The problem arises when you start to add Jade Helm onto the list of other troubling developments that have taken place over the past 30 years or more: the expansion of the military industrial complex and its influence in Washington DC, the rampant surveillance, the corporate-funded elections and revolving door between lobbyists and elected officials, the militarized police, the loss of our freedoms, the injustice of the courts, the privatized prisons, the school lockdowns, the roadside strip searches, the military drills on domestic soil, the fusion centers and the simultaneous fusing of every branch of law enforcement (federal, state and local), the stockpiling of ammunition by various government agencies, the active shooter drills that are indistinguishable from actual crises, the economy flirting with near collapse, etc.
Suddenly, the overall picture seems that much more sinister. Clearly, as I point out in my new bookBattlefield America: The War on the American People, there’s a larger agenda at work here.
Seven years ago, the U.S. Army War College issued a report calling on the military to be prepared should they need to put down civil unrest within the country. Summarizing the report, investigative journalist Chris Hedges declared, “The military must be prepared, the document warned, for a ‘violent, strategic dislocation inside the United States,’ which could be provoked by ‘unforeseen economic collapse,’ ‘purposeful domestic resistance,’ ‘pervasive public health emergencies’ or ‘loss of functioning political and legal order.’ The ‘widespread civil violence,’ the document said, ‘would force the defense establishment to reorient priorities in extremis to defend basic domestic order and human security.’”
At what point will all of the government’s carefully drawn plans for dealing with civil unrest, “homegrown” terrorism and targeting pre-crime become a unified blueprint for locking down the nation?
For instance, what’s the rationale behind turning government agencies into military outposts? There has been a notable buildup in recent years of SWAT teams within non-security-related federal agencies such as Department of Agriculture, the Railroad Retirement Board, the Tennessee Valley Authority, the Office of Personnel Management, the Consumer Product Safety Commission, the U.S. Fish and Wildlife Service and the Education Department. As of 2008, “73 federal law enforcement agencies… [employ] approximately 120,000 armed full-time on-duty officers with arrest authority.” Four-fifths of those officers are under the command of either the Department of Homeland Security (DHS) or the Department of Justice.
What’s with all of the government agencies stockpiling hollow point bullets? For example, why does the Department of Agriculture need .40 caliber semiautomatic submachine guns and 320,000 rounds of hollow point bullets? For that matter, why do its agents need ballistic vests and body armor?
Why does the Postal Service need “assorted small arms ammunition”? Why did the DHS purchase “1.6 billion rounds of hollow-point ammunition, along with 7,000 fully-automatic 5.56x45mm NATO ‘personal defense weapons’ plus a huge stash of 30-round high-capacity magazines”? That’s in addition to the FBI’s request for 100 million hollow-point rounds. The Department of Education, IRS, the Social Security Administration, and the National Oceanic and Atmospheric Administration, which oversees the National Weather Service, are also among the federal agencies which have taken to purchasing ammunition and weaponry in bulk.
Why is the federal government distributing obscene amounts of military equipment, weapons and ammunition to police departments around the country? And why is DHS acquiring more than 2,500 Mine-Resistant Armored Protection (MRAP) vehicles, only to pass them around to local police departments across the country? According to the New York Times:
[A]s President Obama ushers in the end of what he called America’s “long season of war,” the former tools of combat — M-16 rifles, grenade launchers, silencers and more — are ending up in local police departments, often with little public notice. During the Obama administration, according to Pentagon data, police departments have received tens of thousands of machine guns; nearly 200,000 ammunition magazines; thousands of pieces of camouflage and night-vision equipment; and hundreds of silencers, armored cars and aircraft. The equipment has been added to the armories of police departments that already look and act like military units.
Why is the military partnering with local police to conduct training drills around the country? And what exactly are they training for? In Richland, South Carolina, for instance, U.S. army special forces participated in joint and secretive exercises and training with local deputies. The public was disallowed from obtaining any information about the purpose of the drills, other than being told that they might be loud and to not be alarmed. The Army and DHS also carried out similar drills and maneuvers involving Black Hawk helicopters in Texas, Florida, and other locations throughout the U.S., ostensibly in order to provide local police with “realistic” urban training.
What is being done to protect the American populace from the threat of military arms and forces, including unarmed drones, being used against them? Policy analysts point to Directive No. 3025.18, “DefenseSupport of Civil Authorities” (issued on Dec. 29, 2010), as justification for the government’s use of military force to put down civil unrest within the United States.
Why is FEMA stockpiling massive quantities of emergency supplies? On January 10, 2014, FEMA made a statement enlisting the service of contractors who could “supply medical biohazard disposal capabilities and 40 yard dumpsters to 1,000 tent hospitals across the United States; all required on 24-48 hour notice.” This coincides with other medical requests seeking massive amounts of supplies, such as “31,000,000 flu vaccinations,” “100,000 each of winter shirts and pants and the same for summer” and other goods and services requests as well like tarps, manufactured housing units, and beverages. And why does the TSA need $21,000 worth of potassium chlorate, a chemical compound often used in explosives?
Why is the Pentagon continuing to purchase mass amounts of ammunition while at the same time preparing to destroy more than $1 billion worth of bullets and missiles that are still viable?
Moreover, what is really being done to hold the Pentagon accountable for its doctored ledgers, fraud, wasteand mismanagement, which has cost the taxpayer trillions of dollars? According to Reuters, “The Pentagon is the only federal agency that has not complied with a law that requires annual audits of all government departments. That means that the $8.5 trillion in taxpayer money doled out by Congress to the Pentagon since 1996, the first year it was supposed to be audited, has never been accounted for. That sum exceeds the value of China’s economic output.”
Given the similarities between the government’s Live Active Shooter Drill training exercises, carried out at schools, in shopping malls, and on public transit, which can and do fool law enforcement officials, students, teachers and bystanders into thinking it’s a real crisis, how much of what is being passed off as real is, in fact, being staged by DHS for the “benefit” of training law enforcement, leaving us none the wiser? These training exercises come complete with their own set of professionally trained Crisis Actors playing the parts of shooters, bystanders and victims in order to help schools and first responders create realistic drills, full-scale exercises, high-fidelity simulations, and interactive 3D films.
Given that Americans are 110 times more likely to die of foodborne illness than in a terrorist attack, why is the government spending trillions of dollars on “national security”? How exactly is the $75 billion given to various intelligence agencies annually to keep us “safe” being spent? And why is the DHS giving away millions of dollars’ worth of federal security grants to states that federal intelligence agencies ruled have “no specific foreign or domestic terrorism threat”?
Why is the government amassing names and information on Americans considered to be threats to the nation, and what criteria is the government using for this database? Keep in mind that this personal information is being acquired and kept without warrant or court order. It’s been suggested that in the event of nuclear war, the destruction of the U.S. Government, and the declaration of martial law, this Main Core database, which as of 2008 contained some 8 million names of Americans, would be used by military officials to locate and round up Americans seen as threats to national security, a program to be carried about by the Army and FEMA.
Taken individually, these questions are alarming enough. But put them together and they add up to the kind of trouble that the American founding fathers not only warned against but from which they fought to free themselves.
Indeed, when viewed collectively, they leave one wondering what exactly the U.S. government is preparing for and whether American citizens shouldn’t be preparing, as well, for that eventuality when our so-called “government of the people, by the people, for the people” is no longer answerable to “we the people.”
April 17th, 2015 by olddog
By Michael Snyder
Did you know that the number of publicly traded companies declaring bankruptcy has reached a five year high? And did you know that Chinese exports are absolutely collapsing and that Chinese economic growth in 2014 was the weakest in over 20 years? Even though things may seem to be okay on the surface for the global economy at the moment, that does not mean that big trouble is not percolating just under the surface. On Wednesday, investors cheered as stocks soared to new highs, but almost all of the economic news coming in from around the planet has been bad. The credit rating on Greek debt has been slashed again, global economic trade is really slowing down, and many of the exact same financial patterns that we saw just before the crash of 2008 are repeating once again. All of this reminds me of the months leading up to the implosion of Lehman Brothers. Most people were feeling really good about things, but huge trouble was brewing just underneath the surface. Finally, one day we learned that Lehman Brothers had “suddenly” collapsed, and then all hell broke loose.
If the economy is actually “getting better” like we are being told by the establishment media, then why are so many big companies declaring bankruptcy? According to CNBC, the number of publicly traded companies declaring bankruptcy has hit a five year high…
The number of bankruptcies among publicly traded U.S. companies has climbed to the highest first-quarter level for five years, according to a Reuters analysis of data from research firm bankruptcompanynews.com.
Plunging prices of crude oil and other commodities is one of the major reasons for the increased filings, and bankruptcy experts said a more aggressive stance by lenders may also be hurting some companies.
It is interesting to note that the price of oil is being named as one of the primary reasons why this is happening.
In an article entitled “Anyone That Believes That Collapsing Oil Prices Are Good For The Economy Is Crazy“, I warned about this. If the price of oil does not bounce back in a huge way, we are going to see a lot more companies go bankrupt, a lot more people are going to lose their jobs, and a lot more corporate debt is going to go bad.
And of course this oil crash has not just hurt the United States. All over the world, economic activity is being curtailed because of what has happened to the price of oil…
In the heady days of the commodity boom, oil-rich nations accumulated billions of dollars in reserves they invested in U.S. debt and other securities. They also occasionally bought trophy assets, such as Manhattan skyscrapers, luxury homes in London or Paris Saint-Germain Football Club.
Now that oil prices have dropped by half to $50 a barrel, Saudi Arabia and other commodity-rich nations are fast drawing down those “petrodollar” reserves. Some nations, such as Angola, are burning through their savings at a record pace, removing a source of liquidity from global markets.
If oil and other commodity prices remain depressed, the trend will cut demand for everything from European government debt to U.S. real estate as producing nations seek to fill holes in their domestic budgets.
But it isn’t just oil. We appear to be moving into a time when things are slowing down all over the place.
In a recent article, Zero Hedge summarized some of the bad economic news that has come in just this week…
Mortgage Apps tumble, Empire Fed slumps, and now Industrial Production plunges… Against expectations of a 0.3% drop MoM, US Factory Output was twice as bad at -0.6% – the worst since August 2012 (and lamost worst since June 2009). This is the 4th miss in a row.
If we are indeed heading into another economic downturn, that is really bad news, because at the moment we are in far worse shape than we were just prior to the last recession.
To help illustrate this, I want to share with you a couple of charts.
This first chart comes from the Federal Reserve Bank of St. Louis, and it shows that after you adjust for inflation, median income for the middle class is the lowest that it has been in decades…
This next chart shows that median net worth for the middle class is also the lowest that it has been in decades after you adjust for inflation…
The middle class is being systematically destroyed. For much more on this, please see this recent article that I published. And now we are on the verge of another major economic slowdown. That is not what the middle class needs at all.
We are also getting some very disturbing economic news out of China.
In 2014, economic growth in China was the weakest in more than 20 years, and Chinese export numbers are absolutely collapsing…
China’s monthly trade data shows exports fell in March from a year ago by 14.6% in yuan terms, compared to expectations for a rise of more than 8%.
Imports meanwhile fell 12.3% in yuan terms compared to forecasts for a fall of more than 11%.
This is a clear sign that global economic activity is slowing down in a big way.
In addition, Chinese home prices are now falling at a faster pace then U.S. home prices fell during the subprime mortgage meltdown…
It appeared as though things went from bad to worse nearly overnight; China’s National Bureau of Statistics said that contrary to hopes that there would be a modest rebound, the average new home price in China fell at the fastest pace on record in February, from the previous year.
Reuters reported that average new home prices in China’s 70 major cities fell 5.7 percent, year to year, in February – marking the sixth consecutive drop after January’s decline of 5.1 percent.
Things continue to get worse in Europe as well.
This week we learned that the credit rating for Greek government debt has been slashed once again…
Standard & Poor’s has just cut Greece’s credit rating to “CCC+” from “B-” with a negative outlook.
S&P said it expected Greece’s debt to be “unsustainable.” It cited the potential for dissolving liquidity in the government, banks and economy.
And according to the Financial Times, we could actually be on the verge of witnessing a Greek debt default…
Greece is preparing to take the dramatic step of declaring a debt default unless it can reach a deal with its international creditors by the end of April, according to people briefed on the radical leftist government’s thinking.
The government, which is rapidly running out of funds to pay public sector salaries and state pensions, has decided to withhold €2.5bn of payments due to the International Monetary Fund in May and June if no agreement is struck, they said.
So I hope that those that are euphoric about the performance of their stock portfolios are taking their profits while they still can.
Huge trouble is percolating just under the surface of the global economy, and it won’t be too long before the financial markets start feeling the pain.
March 13th, 2015 by olddog
By Brandon Smith
Consumer spending in the U.S. accounts for approximately 70 percent of gross domestic product, though it is important to note that the manner in which “official” GDP is calculated is highly inaccurate. For example, all government money used within the Medicare coverage system to pay for “consumer health demands,” as well as the now flailing Obamacare socialized welfare program, are counted toward GDP, despite the fact that such capital is created from thin air by the Federal Reserve and also generates debt for the average taxpayer. Government debt creation does not beget successful domestic production. If that was a reality, then all socialist and communist countries (same thing) would be wildly enriched today. This is simply not the case.
That said, the swift decline in manufacturing jobs in the U.S. over the past two decades, including a considerable 33 percent overall decline in manufacturing jobs from 2001 to 2010, leaves only the consumer and service sectors as the primary areas of employment and “production.” The service sector provides about three out of every four jobs available in America, according to the Bureau of Labor Statistics.
The truth is that America actually produces very little that is tangible beyond Big Macs, pharmaceuticals and the occasional overpriced fighter jet that doesn’t function correctly and is filled with Chinese parts. All three will kill you at varying degrees of speed…
In the first part of this article series, I discussed the true state of global demand, along with the unstable situation within numerous indicators from exports to retail. Swiftly falling global demand for raw materials as well as consumer goods is an undeniable reality. This is a distinct problem in terms of the U.S., which has been, up until recently, the primary consumption driver for much of the world. As I plan to show, U.S. demand is about to fall even further into the abyss as real unemployment and personal debt take their toll.
Now, it is probably important to address the lies presented in the mainstream and by the BLS in terms of unemployment statistics because even after years of alternative analysts debunking establishment stats and how they are calculated, we STILL end up hearing the same arguments parroted by disinformation agents and unwitting useful idiots.
Such people continue to parade around boasting about the latest BLS reports on job creation claiming that “all is well” because the unemployment rate has dropped to 5.5% and all other talk to the contrary is “doom and gloom.” So, once again, I must relate the fact that the current BLS numbers are an utter sham.
Official unemployment stats are arrived at through disingenuous methods of calculation that were introduced in the 1990s, just before the bursting of the dot com bubble; the introduction of artificially low interest rates, which created the derivatives crisis; and the steady derailment of the U.S. financial system, which has occurred ever since.
So who is actually counted as employed and who is NOT counted as employed by the BLS?
Of the 102 million working-age Americans without work today, only 8.7 million are counted by the BLS as unemployed. Out of all working-age Americans, over 92 million are without jobs and are not counted by the BLS as unemployed. Why?
Well, if you ever read establishment-leaning propaganda websites like Factcheck or Poltifact, the argument is essentially that these 92 million Americans are not counted because they “refuse to participate,” not because they can’t find adequate employment and not because the government is misrepresenting the numbers. Yes, that’s right, 92 million Americans don’t count because they clearly must not want work.
So, first, I would ask how it is that the BLS comes to the conclusion that nearly one-third of the U.S. population does not want to work? Is it through its so called “household surveys?” Surveys, just like public polls, can be easily manipulated to affirm any particular bias merely by changing how questions are phrased. I would certainly love to see the raw data from such polls before the BLS adds its own spin.
Second, even if such claims were true and tens of millions of Americans did not want to work, why would this matter? Shouldn’t they still be counted as unemployed in order to draw the most accurate picture of our economic situation? Wouldn’t 92 million Americans apparently on a long-term labor and productivity strike have a severe negative effect on real GDP? And obviously, they must be surviving somehow. Wouldn’t 92 million people eventually require government assistance through food stamps and welfare? Does none of this matter to the BLS in terms of the overall economic picture?
Third, if the assertion is that 92 million people do not want jobs, then by extension the BLS would have to show that those millions of people could in fact get a job if they simply tried. Where are these tens of millions of jobs that Americans are refusing to apply for and what do they pay?
Fourth, a common misrepresentation attached to the claim of “refusal to participate” is that many of these Americans are teens in school (16 to 18) and possible “retirees” (55 or older). The BLS and the mainstream media simply assume these people do not want a job and should not be counted as unemployed. Of course, the BLS includes such people in its stats when they DO have jobs. So, according to the BLS, if you are 16 or 55 or 65 and you have a job, then you count. If you are 16 or 55 or 65 and don’t have a job, then you don’t count. See how that works?
Fifth, millions of Americans are losing long-term unemployment benefits every quarter and are being removed from BLS statistics. Many of them are not teens or retirees. These are average-working-age adults who now no longer have any real launch pad to progress in their career or life, and who should be fully motivated to obtain work if jobs are so readily available. Again, where are these jobs that said prime-working-age people refuse to accept?
The BLS also invariably discounts the number of working-age Americans who enter the market as well when boasting of jobs created to the public. Job growth numbers do not weigh the number of new participants each month with the number of supposed jobs made available, thus creating a misconception about how many new jobs are actually needed to keep the economy functional.
Another important factor to observe in government labor statistics is the issue of part-time work. When the BLS releases its monthly stats on unemployment, it does not widely promote or discuss the fact that 18 percent to 20 percent of those labeled “employed” are considered “part-time employed.” The BLS defines “part-time employed” as anyone who works 1 to 34 hours per week. Yes, if you work one hour per week, you have helped to bring down the overall unemployment rate of the U.S. to a fantastic 5.5 percent, even though you likely have zero ability to support yourself financially, let alone a family.
What does the 5.5 percent unemployment number actually represent on a fundamental level where the real world actually matters rather than the world of hypothetical calculations? Not a damn thing. The number is absolutely and unequivocally meaningless.
If one were to calculate unemployment using pre-1990s methods, as websites like Shadowstats.com do, counting U-6 measurements as well as the underemployed, you would come up with a U.S. jobless rate closer to 23 percent.
Many of those workers in the service sector on the higher end of the part-time and full-time spectrum still cannot support themselves adequately due to falling wages, rising prices and growing debt obligations, which brings me to the next problem at hand.
Beyond unemployment as a destroyer of consumer demand, there is also personal debt. Much of the focus within the mainstream and even alternative economics revolves around national debt (I will cover the many lies surrounding national debt in my next article). However, effects on fundamental demand are far clearer when one examines household liabilities. According to averages supplied through government stats (meaning the real numbers are likely far worse), the average American household suffers from between $10,000 to $15,000 in credit card debt, $155,000 in mortgage debt and $32,000 in student loan debt.
Americans owed nearly $12 trillion overall in 2014, an increase of 3.3 percent over 2013. Declines in some debts, including a decline in credit card debts since 2011, are attributed to numerous defaults, not repayments.
What we have here is a deadly fiscal combination; namely the combination of real unemployment at permanently high levels and real personal debt at unsustainable levels. This is the core reason behind the collapse in global demand that was discussed in the first installment of this series. With U.S. consumers no longer able to support their historical consumption habits and with the inflexible skeleton of the U.S. economy in particular dependent on past consumer dynamics, the system has little financial plasma left circulating.
This is not necessarily a new trend; but 10 years ago, Americans were able to offset their dwindling buying power by taking on massive debts through easy Federal Reserve fiat fueling questionable bank loans. They no longer have this option; thus, consumption is going to degrade (and is degrading) to the point that the current financial structure, stuck in its rigid and fragile dynamic, will collapse. There is no way around it.
As stated in my last article, the numbers given here are in most cases establishment-generated statistics. A common argument among state apologists and propagandists is that we in the alternative economic field should be labeled “hypocritical” if we debunk some mainstream stats while using others as reference points. I would make clear yet again that it is the contradictions within the government’s own numbers and claims that alternative analysts are most concerned with. My view is that when mainstream numbers actually reflect negative economic trends, they should be multiplied according to other prominent factors. That is to say, when the government bureaucrats and fantasy masters finally admit things are bad, they are actually much worse than indicated.
Some mainstream statistics are outright fraudulent; some are half true; others are factual yet hidden in plain site from the general public. In between the lines of all of this information, good and bad, alternative economists attempt to discern as much foundational truth as possible. As this series continues, I believe readers new to the Liberty Movement, as well as longtime activists, will come to view a wider and fuller picture of our fiscal situation and come to the same conclusion I have – That the manner in which we live today is about to drastically change, and that this coming change is being hidden from us deliberately by those who wish to use a tactic of financial shock and awe to their ultimate advantage.
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February 25th, 2015 by olddog
A Joint Initiative of GordonTLong.com and CliffKule.com
CURRENT FINANCIAL REPRESSION INITIATIVES
(MONEY MARKET FUND GATES (SEC REGULATIONS)
- **FRA POST: Central-Planners Herd Money Market Funds Into Government Financing
- **FRA POST: Fund managers now have the Legal Right to ‘suspend redemptions’ by the you on your Money Market Funds
- “Redemption Gates” for Money Market Funds Acting Man —“The adoption of ‘redemption gates’ effectively means that money market fund boards will be able to suspend the property rights of their customers. Once again, this creates a big disadvantage for the money market fund industry in favor of banks, since demand deposits will continue to lack such ‘redemption gates’, in spite of the fact that banks are de facto unable to actually pay out all demand deposits, or even a large portion of them, ‘on demand’. It is an interesting detail that retail customers are to be exempt from this regulation based on the idea that they are basically too addled to react to crisis conditions. Why are such regulations held to be required at all? Are regulators implying that the system has not been ‘made safe’ by adopting several telephone book-sized tomes of additional regulations?”
- SEC Votes Through Money Market Exit Gates Zero Hedge — the SEC has adopted the news rules designed to curb the risk of money market investor runs .. “Among the changes, funds will have to switch to a floating share price instead of the current $1/share (hence the term breaking the buck). But the key part: ‘The SEC’s rule will require prime money market funds to move from a stable $1 per share net asset value, to a floating NAV. It also will let fund boards lower redemption ‘gates’ and fees in times of market stress.” .. suggests this may send money market investor rushing out & into other asset classes – the SEC, the Federal Reserve & the U.S. Treasury hope that asset class is stocks to keep the stock market rising .. “Clearly, everyone understand that the only purpose behind implementing ‘gates’ is to redirect the herd. And with some $2.6 trillion in assets, money markets can serve as a convenient source of ‘forced buying’ now that QE is tapering if only for the time being. The only question is whether the herd will agree to this latest massive behavioral experiment by the Fed, and allocate their funds to a stock market which is now trading at a higher P/E multiple than during the last market peak.”
- ALERT: Pull Your Money From Money Markets Now! Economic Policy Journal
- U.S. SEC poised to adopt reforms for money market funds Reuters
- Fund managers on alert over money market shake-up FT –The SEC is looking to drive money market funds to only government securities, especially institutional money market funds – this means money market funds will be helping to pay for the government debt .. The SEC is also planning to allow fees and restrictions on redemptions in times of stress, but it is not clear how widely these will be applied across the money markets – FT: “Any restrictions on redemptions may not be severe at first, but the regulations will only become more restrictive over time. Don’t waste time thinking you are going to monitor the situation and get out later. Get out now, when the getting is easy.”
Do you know the difference between a money market fund and a money market account? CNBC Personal Finance Reporter Sharon Epperson explains the big difference
BAIL-IN (GLOBAL – G20 LEGISLATION)
- Australia: ‘Bail in’ Rules May Be Inevitable In Australia – August 22, 2014 Bail in’ rules may be inevitable, says David Murray of the Financial Systems Inquiry Chair in Australia .. “It appears there’s a wide consensus that bail-in would considerably expand the buffer, would further assist in the mechanisms for the protection of depositors, and importantly would create a system where it is less likely that the government would be dragged into a crisis.” .. Australia may have little choice but to adopt “bail-in” rules that expose bank creditors to losses, due to our dependence on foreign capital .. more financial repression.
- Canada: Department Of Finance Releases Proposal For Canadian Bail-In Regime Canada’s government is looking to implement a bail-in regime to limit exposure to a government bailout – the idea is for troubled banks to shaft bank depositors of their bank deposits first .. “The G-20, including Canada, endorsed the Financial Stability Board’s Key Attributes of Effective Resolution Regimes for Financial Institutions in 2011, a set of best practices for the resolution of financial institutions which contemplates the establishment of a bail-in regime.”
**FRA POST: Federal Reserve & Congress Talk “ENHANCED PRUDENTIAL STANDARDS”
CAPITAL CONTROLS (CASEY RESEARCH ON COMING CAPITAL CONTROLS)
**FRA POST: Indebted Governments Will Resort To Capital Controls
1: IMF Endorses Capital Controls
Bloomberg reported in December 2012 that the “IMF has endorsed the use of capital controls in certain circumstances.“ This is particularly important because the IMF, arguably an even more prominent institution since the global financial crisis started, has always had an official stance against capital controls. “In a reversal of its historic support for unrestricted flows of money across borders, the IMF said controls can be useful…” Will individual governments jump on this bandwagon? “It will be tacitly endorsed by a lot of central banks,”says Boston University professor Kevin Gallagher. If so, it could be more than just your home government that will clamp down on storing assets elsewhere.
2: There Is Academic Support for Capital Controls
Many mainstream economists support capital controls. For example, famed Harvard Economists Carmen Reinhart and Ken Rogoff wrote the following earlier this year:
Governments should consider taking a more eclectic range of economic measures than have been the norm over the past generation or two. The policies put in place so far, such as budgetary austerity, are little match for the size of the problem, and may make things worse. Instead, governments should take stronger action, much as rich economies did in past crises.
Aside from the dangerously foolish idea that reining in excessive government spending is a bad thing, Reinhart and Rogoff are saying that even more massive government intervention should be pursued. This opens the door to all kinds of dubious actions on the part of politicians, including—to my point today—capital controls.
“Ms. Reinhart and Mr. Rogoff suggest debt write-downs and ‘financial repression’, meaning the use of a combination of moderate inflation and constraints on the flow of capital to reduce debt burdens.” The Reinhart and Rogoff report basically signals to politicians that it’s not only acceptable but desirable to reduce their debts by restricting the flow of capital across borders. Such action would keep funds locked inside countries where said politicians can plunder them as they see fit.
3: Confiscation of Savings on the Rise
“So, what’s the big deal?” Some might think. “I live here, work here, shop here, spend here, and invest here. I don’t really need funds outside my country anyway!” Well, it’s self-evident that putting all of one’s eggs in any single basket, no matter how safe and sound that basket may seem, is risky—extremely risky in today’s financial climate. In addition, when it comes to capital controls, storing a little gold outside one’s home jurisdiction can help avoid one major calamity, a danger that is growing virtually everywhere in the world: the outright confiscation of people’s savings.
The IMF, in a report entitled “Taxing Times,” published in October of 2013, on page 49, states: “The sharp deterioration of the public finances in many countries has revived interest in a capital levy—a one-off tax on private wealth—as an exceptional measure to restore debt sustainability.”
The problem is debt. And now countries with higher debt levels are seeking to justify a tax on the wealth of private citizens. So, to skeptics regarding the value of international diversification, I would ask: Does the country you live in have a lot of debt? Is it unsustainable? If debt levels are dangerously high, the IMF says your politicians could repay it by taking some of your wealth.
The following quote sent shivers down my spine…
The appeal is that such a task, if implemented before avoidance is possible and there is a belief that is will never be repeated, does not distort behavior, and may be seen by some as fair. The conditions for success are strong, but also need to be weighed against the risks of the alternatives, which include repudiating public debt or inflating it away.
The IMF has made it clear that invoking a levy on your assets would have to be done before you have time to make other arrangements. There will be no advance notice. It will be fast, cold, and cruel. Notice also that one option is to simply inflate debt away. Given the amount of indebtedness in much of the world, inflation will certainly be part of the “solution,” with or without outright confiscation of your savings. (So make sure you own enough gold, and avoid government bonds like the plague.)
Further, the IMF has already studied how much the tax would have to be: The tax rates needed to bring down public debt to pre-crisis levels are sizable: reducing debt ratios to 2007 levels would require, for a sample of 15 euro area countries, a tax rate of about 10% on households with a positive net worth. Note that the criterion is not billionaire status, nor millionaire, nor even “comfortably well off.” The tax would apply to anyone with a positive net worth. And the 10% wealth-grab would, of course, be on top of regular income taxes, sales taxes, property taxes, etc.
4: We Like Pension Funds
Unfortunately, it’s not just savings. Carmen Reinhart (again) and M. Belén Sbrancia made the following suggestions in a 2011 paper:
Historically, periods of high indebtedness have been associated with a rising incidence of default or restructuring of public and private debts. A subtle type of debt restructuring takes the form of ‘financial repression.’ Financial repression includes directed lending to government by captive domestic audiences (such as pension funds), explicit or implicit caps on interest rates, regulation of cross-border capital movements, and (generally) a tighter connection between government and banks.
Yes, your retirement account is now a “captive domestic audience.” Are you ready to “lend” it to the government? “Directed” means “compulsory” in the above statement, and you may not have a choice if “regulation of cross-border capital movements”—capital controls—are instituted.
5: The Eurozone Sanctions Money-Grabs
Germany’s Bundesbank weighed in on this subject last January:
“Countries about to go bankrupt should draw on the private wealth of their citizens through a one-off capital levy before asking other states for help.”
The context here is that of Germans not wanting to have to pay for the mistakes of Italians, Greeks, Cypriots, or whatnot. Fair enough, but the “capital levy” prescription is still a confiscation of funds from individuals’ banks or brokerage accounts.
Here’s another statement that sent shivers down my spine:
A capital levy corresponds to the principle of national responsibility, according to which tax payers are responsible for their government’s obligations before solidarity of other states is required.
The central bank of the strongest economy in the European Union has explicitly stated that you are responsible for your country’s fiscal obligations—and would be even if you voted against them! No matter how financially reckless politicians have been, it is your duty to meet your country’s financial needs.
This view effectively nullifies all objections. It’s a clear warning.
And it’s not just the Germans. On February 12, 2014, Reuters reported on an EU commission document that states:
The savings of the European Union’s 500 million citizens could be used to fund long-term investments to boost the economy and help plug the gap left by banks since the financial crisis.
Reuters reported that the Commission plans to request a draft law, “to mobilize more personal pension savings for long-term financing.”
EU officials are explicitly telling us that the pensions and savings of its citizens are fair game to meet the union’s financial needs. If you live in Europe, the writing is on the wall.
Actually, it’s already under way… Reuters recently reported that Spain has
…introduced a blanket taxation rate of .03% on all bank account deposits, in a move aimed at… generating revenues for the country’s cash-strapped autonomous communities.
The regulation, which could bring around 400 million euros ($546 million) to the state coffers based on total deposits worth 1.4 trillion euros, had been tipped as a possible sweetener for the regions days after tough deficit limits for this year and next were set by the central government.
Some may counter that since Spain has relatively low tax rates and the bail-in rate is small, this development is no big deal. I disagree: it establishes the principle, sets the precedent, and opens the door for other countries to pursue similar policies.
6: Canada Jumps on the Confiscation Bandwagon
You may recall this text from last year’s budget in Canada:
“The Government proposes to implement a bail-in regime for systemically important banks.”
A bail-in is what they call it when a government takes depositors’ money to plug a bank’s financial holes—just as was done in Cyprus last year.
This regime will be designed to ensure that, in the unlikely event a systemically important bank depletes its capital, the bank can be recapitalized and returned to viability through the very rapid conversion of certain bank liabilities into regulatory capital.
What’s a “bank liability”? Your deposits. How quickly could they do such a thing? They just told us: fast enough that you won’t have time to react.
By the way, the Canadian bail-in was approved on a national level just one week after the final decision was made for the Cyprus bail-in.
Have you considered why the Foreign Account Tax Compliance Act was passed into law? It was supposed to crack down on tax evaders and collect unpaid tax revenue. However, it’s estimated that it will only generate $8.7 billion over 10 years, which equates to 0.18% of the current budget deficit. And that’s based on rosy government projections.
FATCA was snuck into the HIRE Act of 2010, with little notice or discussion. Since the law will raise negligible revenue, I think something else must be going on here. If you ask me, it’s about control.
In my opinion, the goal of FATCA is to keep US savers trapped in US banks and in the US dollar, in case the US wants to implement a Cyprus-like bail-in. Given the debt load in the US and given statements made by government officials, this seems like a reasonable conclusion to draw.
This is why I think that the institution of capital controls is a “when” question, not an “if” one. The momentum is clearly gaining steam for some form of capital controls being instituted in the near future. If you don’t internationalize, you must accept the risk that your assets will be confiscated, taxed, regulated, and/or inflated away.
What to Expect Going Forward
- First, any announcement will probably not use the words “capital controls.”It will be couched positively, for the “greater good,” and words like “patriotic duty” will likely feature prominently in mainstream press and government press releases. If you try to transfer assets outside your country, you could be branded as a traitor or an enemy of the state, even among some in your own social circles.
- Controls will likely occur suddenly and with no warning. When did Cyprus implement their bail-in scheme? On a Friday night after banks were closed. By the way, prior to the bail-in, citizens were told the Cypriot banks had “government guarantees” and were “well-regulated.” Those assurances were nothing but a cruel joke when lightning-fast confiscation was enacted.
- Restrictions could last a long time. While many capital controls have been lifted in Cyprus, money transfers outside the country still require approval from the Central Bank—over a year after the bail-in.
- They’ll probably be retroactive.Actually, remove the word “probably.” Plenty of laws in response to prior financial crises have been enacted retroactively. Any new fiscal or monetary emergency would provide easy justification to do so again. If capital controls or savings confiscations were instituted later this year, for example, they would likely be retroactive to January 1. For those who have not yet taken action, it could already be too late.
- Social environment will be chaotic.If capital controls are instituted, it will be because we’re in some kind of economic crisis, which implies the social atmosphere will be rocky and perhaps even dangerous. We shouldn’t be surprised to see riots, as there would be great uncertainty and fear. That’s dangerous in its own right, but it’s also not the kind of environment in which to begin making arrangements.
- Ban vs. levy. Imposing capital controls is a risky move for a government to make; even the most reckless politicians understand this. That won’t stop them, but it could make them act more subtly. For instance, they might not impose actual bans on moving money across borders, but instead place a levy on doing so. Say, a 50% levy? That would “encourage” funds to remain inside a given country. Why not 100%? You could be permitted to transfer $10,000 outside the country—but if the fee for doing so is $10,000, few will do it. Such verbal games allow politicians to claim they have not enacted capital controls and yet achieve the same effect. There are plenty of historical examples of countries doing this very thin
Keep in mind: Who will you complain to? If the government takes a portion of your assets, legally, who will you sue? You will have no recourse. And don’t expect anyone below your tax bracket to feel sorry for you.
POLICY CONTROLS (Monetary, Fiscal, Public & Tax Policy)
- January 2015 Financial Repression – New IMF Paper on The Liquidation of Government Debt New IMF paper by Carmen Reinhart & M. Belen Sbrancia .. presents how public debt is often reduced through the use of financial repression – a tax on bondholders & savers via negative or below market real interest rates .. from abstract:High public debt often produces the drama of default and restructuring. But debt is also reduced through financial repression, a tax on bondholders and savers via negative or below-market real interest rates. After WWII, capital controls and regulatory restrictions created a captive audience for government debt .. Financial repression is most successful in liquidating debt when accompanied by inflation. For the advanced economies, real interest rates were ne gative ½ of the time during 1945–1980. Average annual interest expense savings for a 12—country sample range from about 1 to 5% of GDP for the full 1945–1980 period. We suggest that, once again, financial repression may be part of the toolkit deployed to cope with the most recent surge in public debt in advanced economies.”
- October 2014 – Financial Repression is Very Low Interest Rates for a Very Long Time The 16th annual Geneva Report by the International Centre for Monetary and Banking Studies & written by senior economists including 3 former senior central bankers, predicts interest rates across the world will have to stay low for a “very, very long” time to enable households, companies, & governments to service their debts and avoid another crash .. The report’s authors expect interest rates to stay lower than market expectations because the rise in debt means that borrowers would be unable to withstand faster rate rises .. “Global debt-to-GDP is still growing, breaking new highs .. At the same time, in a poisonous combination, world growth and inflation are also lower than previously expected, also – though not only – as a legacy of the past crisis. Deleveraging and slower nominal growth are in many cases interacting in a vicious loop, with the latter making the deleveraging process harder and the former exacerbating the economic slowdown. Moreover, the global capacity to take on debt has been reduced through the combination of slower expansion in real output and lower inflation.”
- October 2014 – Financial Repression is the likely approach for Governments to pay down debt Great insightful article on financial repression by Daniel Amerman .. questions how the U.S. federal government can pay down its enormous debt .. sees 4 primary options that the government can take: 1) Decades of austerity with higher taxes and lower government spending. 2) Defaulting on government debts. 3) Inflating away the value of the debt through rapidly slashing the value of the currency. 4) Using “Financial Repression”, a process that is complex enough that the average voter never understands how it works, thus allowing governments to use this potent but subtle method of taking vast sums of private wealth, year after year, decade after decade, with almost no political consequences. The essay reminds readers the 4th option is the likely approach, points out the world took this approach in the 1940s through the 1970s to pay down government debt .. “Because of the sheer size of the problem – most of the population must be made to participate, year after year. Financial Repression therefore uses an assortment of carrots and sticks to ensure that investors have little choice but to participate – on a playing field that has been rigged against them as a matter of design – even if they are among the small minority who are aware of what is being done to them.”The essay covers 4 areas of financial repression: 1) Inflation (Shearing #1) 2) Negative Real Interest Rates (Shearing #2) 3) Funding By Financial Institutions (Fence #1). 4) Capital Controls (Fence #2).
- September 2014 – Governments Implementing Financial Repression International Man article on how western world indebted governments need money, how they will protect the big banks at the expense of the citizens with financial repression .. The International Monetary Fund (IMF) published a horrifying paper, called The Fund’s Lending Framework and Sovereign Debt. That paper in turn was based on one from December 2013, called Financial and Sovereign Debt Crises: Some Lessons Learned and Those Forgotten .. The December 2013 document, right at the start, says that financial repression is necessary: “The claim is that advanced countries do not need to resort to the standard toolkit of emerging markets, including debt restructurings and conversions, higher inflation, capital controls and other forms of financial repression .. As we document, this claim is at odds with the historical track record of most advanced economies, where debt restructuring or conversions, financial repression, and a tolerance for higher inflation, or a combination of these were an integral part of the resolution of significant past debt overhangs.” .. The IMF report goes on to say: “Governments can stuff debt into local pension funds and insurance companies, forcing them through regulation to accept far lower rates of return than they might otherwise demand .. Domestic defaults, restructurings, or conversions are particularly difficult to document and can sometimes be disguised as ‘voluntary’ .. The Fund would be able to provide exceptional access on the basis of a debt operation that involves an extension of maturities .. That means that 30-day notes can be instantly turned into 30-year bonds.” – this last sentence means the ability to change 30-day notes into 30-year bonds, effectively holding the money captive for a much longer period of time
- Monetary Policy & Financial Repression in Britain, 1951 – 59 New book coming out by William Allen on Monetary Policy and Financial Repression in Britain, 1951 – 59 .. this book explores the politics of formulating monetary policy in the 1950s, the tools implementing it & discusses the parallels between the present monetary policy & that of 1951 .. “Drawing on official archives, this study describes how monetary policy was decided on, implemented and communicated at a time when the government was struggling with massive post-war debts while maintaining welfare and military spending and cutting taxes. It discusses the roles of the Governor of the Bank of England, Cameron Cobbold, and of successive Chancellors R.A. Butler, Harold Macmillan, Peter Thorneycroft and Derick Heathcoat Amory, and Macmillan’s continued dominance of monetary policy after he became Prime Minister. It explains the intimate relationships between monetary policy, government debt management and fiscal policy, and the use of ‘financial repression’.”
- Low Interest Rates & Inflation To Address Financial Repression Article points out the worse things get on the European financial/economic crisis, the more pressure there is on the European Central Bank (ECB) to print money – stocks will likely go up as this happens on the anticipation that the ECB will given in & start money printing .. “The ECB would print money and use it to buy eurozone government bonds, in order to prop up the region’s banking sector, and to encourage more risk-taking by lenders and investors. Of course, any hint of more money-printing always cheers the market, and European stocks reacted well to the news.” .. the article points to how U.S. & UK stocks have similarly reacted positively on all the money printing .. whether all this money is good for the economy or whether it even benefits the economy in any positive way is another question .. the article emphasizes the approach of financial repression taken by the U.S. & UK in keeping interest rates down & allowing inflation to rise in order to pay off some government debt via inflation, rather than by defaulting or cutting back spending .. most western world governments are in this bind, so that “we could see interest rates staying lower than markets expect for some time. And in the longer run, we could see a lot more inflation than we’ve been used to as well” .. in terms of investing, the article suggests sticking with countries that are looking to do more money printing & that have relatively inexpensive stock markets, such as Europe or Japan.
- This Is Going To Destabilize The Entire World Financial System Ronald-Peter Stoferle, Incrementum AG “Bond prices in practically all industrialized nations are near all-time highs. Never before have interest rates been this low on a global basis. If one examines these events more closely, it becomes clear that the underlying problems cannot be solved by global zero interest rate policy, but that the natural selection process of the market is instead being undermined .. Interest rates are the heart, soul and life of the free enterprise system .. This truth is however veiled and distorted at the moment. Governments, financial institutions, entrepreneurs and consumers that are acting in an uneconomic manner are thus kept artificially afloat. As a result, instead of them being punished for their errors, these errors are perpetuated. Protraction of this process of selection leads to a structural weakening of the economy, and a concomitant increase in the system’s fragility .. Declining interest rate levels make a gradual increase in public indebtedness possible, while the interest burden (as a share of government spending) does not grow .. Without negative real interest rates, the steadily growing mountains of debt would long ago have ceased to be sustainable. Central banks are increasingly prisoners of the policy of over-indebtedness .. Central banks and governments are currently trying to create an increase in prosperity out of nothing. Such a monetary perpetuum mobile would be quite desirable for humankind, however, historically such attempts have at best led to a brief sugar high followed by a major hangover.
- Alasdair Macleod On The Markets: Keep Calm & Carry On “Investment is now all about the trend and little else. You never have to value anything properly any more: just measure confidence. This approach to investing resonates with post-Keynesian economics and government planning. The expectations of the crowd, or its animal spirits, are now there to be managed. No longer is there the seemingly irrational behaviour of unfettered markets dominated by independent thinkers. Forward guidance is just the latest manifestation of this policy. It represents the triumph of economic management over the markets .. Doubtless there is a growing band of central bankers who believe that with this control they have finally discovered Keynes’s Holy Grail: the euthanasia of the rentier and his replacement by the state as the primary source of business capital. This being the case, last month’s dip in the markets will turn out to be just that, because intervention will simply continue and if necessary be ramped up .. But in the process, all market risk is being transferred from bonds, equities and all other financial assets into currencies themselves; and it is the outcome of their purchasing power that will prove to be the final judgement in the debate of markets versus economic planning.”
- The Fed’s Financial Repression At Work: How Big Blue Was Turned Into A Wall Street Slush Fund David Stockman — “IBM is a poster child for the ill-effects of the Fed’s financial repression. In effect, the Fed’s zero interest rate policies are telling big companies to issue truckloads of debt and use the proceeds to buyback shares hand-over-fist. That way fast money speculators on Wall Street are appeased by the resulting share price lift, and top executives collect bigger winnings on their stock options.”
- Time For Regime Change At The Eccles Building: Interest Rate Pegging Is Destroying Capitalism 07-13-14 David Stockman
- BoJ To Engage In ‘Financial Repression'; We Stay Long USD/JPY – BNPP 07-11-14 eFX News “Japan now has one of the highest inflation rates in the G10. Our economists expect the BoJ to engage in ‘financial repression’ to restrain the rise in JGB yields that results from Japan’s fiscal dynamics,” BNPP says as a rationale behind this view. “A larger overshoot in Japan’s inflation rate would also see the yen weaken. If inflation gets out of hand, we could, our economists suggest, see an ‘operation twist’ policy in Japan – similar to that witnessed in the US. This would entail aggressive purchases of JGBs coupled with interest rate hikes to stave off inflation. The resultant inversion in the yield curve, along with the upside shock to inflation, is a risk scenario for Japan and the ensuing adverse growth-inflation paradigm would necessarily entail a weaker yen,” BNPP argues. “In addition, a re-allocation in the government pension investment fund (GPIF) and a likely pick-up in Japanese outflows will mean JPY weakens,” BNPP adds.
- Expropriation Is Back – Is Christine Lagarde The Most Dangerous Woman In The World? Zero Hedge
- Norway Sovereign Wealth Fund Unveils “New Strategy” – Buy 5% Of Every European Stock 06-24-14
- Boston Consulting Group Study September 2011
- Financial and Sovereign Debt Crises: Some Lessons Learned and Those Forgotten – December 2013 IMF
- Extending Maturities on Bonds – 05-22-14 IMF
MyRA – More About Getting Votes Than Helping Middle Class
The Three Stooges Debunk myRA – Zero Hedge
The MyRA Propaganda Begins A Start To A Secure Retirement Promises Treasury Secretary
Obama To Unveil Treasury IRAs, Or Planning For A Post-Monetization World
The Next Shoe To Drop On Your Retirement Account
Default, Deflation and Financial Repression
ECB Seriously Considering Negative Interest Rates; New Central Bank Mottos
First It Was Bail-Ins And Now EU Sees “Personal Pension Savings” As “Plug” For Banks
Furious Backlash Forces HSBC To Scrap Large Cash Withdrawal Limit
We Are From The Government And We Are Here To Offer You A No Risk, Guaranteed Return Investment Product
Theft Is Deflationary – Especially The Crony-CapitalistState Kind
When Saving Interest Rates Go Negative
REGULATORY CONTROLS & ENFORCEMENT
- U.S. Pushing Banks On Dodd-Frank Act To Make It Easier For Government To FREEZE YOUR MONEY – Financial Repression Via Regulations “The U.S. wants big banks to simplify their Dodd-Frank Act resolution plans so it’s easier for government to freeze your money.” .. Bloomberg reports on the progress made by Wall Street banks developing their “living wills” as part of the Dodd-Frank Act legislation attempting to minimize “too big to fail” banks .. Bloomberg: “The Federal Reserve and Federal Deposit Insurance Corp. told 11 of the largest U.S. and foreign banks, including JP Morgan Chase & Co. (JPM) and Goldman Sachs Group Inc. (GS), that they botched their so-called living wills. The agencies ordered the banks to simplify their legal structures and revise some practices to make sure they can collapse without damaging the wider financial system.” Jim Rickards:
- Fischer worries about macroprudential policy– 07-10-14 FT Mr Fischer’s most interesting remarks relate to his experience with macroprudential policy in Israel. Israel’s bank supervisor used a range of tools to restrict mortgage lending and try to avert a housing bubble. Mr Fischer draws three lessons:
- Prohibiting Banks From Paying Interest On Demand Deposits Regulation Q
- Basel Accord II and III – 05-16-14 Cliff Küle
PUBLIC & PRIVATE PRESSURES & PENALTIES
Charting The Death Of The Saver
Placing the Government Debt on the back off Savers & Pensioners
(ie the 75M Baby Boomers About to Retire)
February 12th, 2015 by olddog
Over the past decade, there has been only one other time when the value of the U.S. dollar has increased by so much in such a short period of time. That was in mid-2008 – just before the greatest financial crash since the Great Depression.
A surging U.S. dollar also greatly contributed to the Latin American debt crisis of the early 1980s and the Asian financial crisis of 1997. Today, the globe is more interconnected than ever. Most global trade is conducted in U.S. dollars, and much of the borrowing done by emerging markets all over the planet is denominated in U.S. dollars. When the U.S. dollar goes up dramatically, this can put a tremendous amount of financial stress on economies all around the world. It also has the potential to greatly threaten the stability of the 65 trillion dollars in derivatives that are directly tied to the value of the U.S. dollar.
The global financial system is more vulnerable to currency movements than ever before, and history tells us that when the U.S. dollar soars the global economy tends to experience a contraction. So the fact that the U.S. dollar has been skyrocketing lately is a very, very bad sign.
Most of the people that write about the coming economic collapse love to talk about the coming collapse of the U.S. dollar as well. But in the initial deflationary stage of the coming financial crisis, we are likely to see the U.S. dollar actually strengthen considerably.
As I have discussed so many times before, we are going to experience deflation first, and after that deflationary phase the desperate responses by the Federal Reserve and the U.S. government to that deflation will cause the inflationary panic that so many have written about.
Yes, someday the U.S. dollar will essentially be toilet paper. But that is not in our immediate future. What is in our immediate future is a “flight to safety” that will push the surging U.S. dollar even higher.
This is what we witnessed in 2008, and this is happening once again right now.
Just look at the chart that I have posted below. You can see the the U.S. dollar moved upward dramatically relative to other currencies starting in mid-2008. And toward the end of the chart you can see that the U.S. dollar is now experiencing a similar spike…
At the moment, almost every major currency in the world is falling relative to the U.S. dollar.
For example, this next chart shows what the euro is doing relative to the dollar. As you can see, the euro is in the midst of a stunning decline…
Unfortunately, most Americans have absolutely no idea how important all of this is. In recent years, growing economies all over the world have borrowed gigantic piles of very cheap U.S. dollars. But now they are faced with the prospect of repaying those debts and making interest payments using much more expensive U.S. dollars.
Investors are starting to get nervous. At one time, investors couldn’t wait to pour money into emerging markets, but now this process is beginning to reverse. If this turns into a panic, we are going to have one giant financial mess on our hands.
The truth is that the value of the U.S. dollar is of great importance to every nation on the face of the Earth. The following comes from U.S. News & World Report…
In the early ’80s, a bullish U.S. dollar contributed to the Latin American debt crisis, and also impacted the Asian Tiger crisis in the late ’90s. Emerging markets typically have higher growth, but carry much higher risk to investors. When the economies are doing well, foreign investors will lend money to emerging market countries by purchasing their bonds.
They also deposit money in foreign banks, which facilitates higher lending. The reason for this is simple: Bond payments and interest rates in emerging markets are much higher than in the U.S. Why deposit cash in the U.S. and earn 0.25 percent, when you could earn 6 percent in Indonesia? With the dollar strengthening, the interest payments on any bond denominated in U.S. dollars becomes more expensive.
Additionally, the deposit in the Indonesian bank may still be earning 6 percent, but that is on Indonesian rupiahs. After converting the rupiahs to U.S. dollars, the extra interest doesn’t offset the loss from the exchange. As investors get nervous, the higher interest on emerging market debt and deposits becomes less alluring, and they flee to safety. It may start slowly, but history tells us it can quickly spiral out of control.
Over the past few months, I have been repeatedly stressing that so many of the signs that we witnessed just prior to previous financial crashes are happening again.
Now you can add the skyrocketing U.S. dollar to that list.
If you have not seen my previous articles where I have discussed these things, here are some places to get started…
“Guess What Happened The Last Time The Price Of Oil Crashed Like This?…”
“Not Just Oil: Guess What Happened The Last Time Commodity Prices Crashed Like This?…”
“10 Key Events That Preceded The Last Financial Crisis That Are Happening Again RIGHT NOW”
The warnings signs are really starting to pile up.
When we look back at past financial crashes, there are recognizable patterns that can be identified.
Anyone with half a brain should be able to see that a large number of those patterns are unfolding once again right before our eyes.
Unfortunately, most people in this world end up believing exactly what they want to believe.
No matter how much evidence you show them, they will not accept the truth until it is too late.
This article first appeared here at the Economic Collapse Blog. Michael Snyder is a writer, speaker and activist who writes and edits his own blogs The American Dream and Economic Collapse Blog. Follow him on Twitter here.
AS I’VE SAID BEFORE
December 23rd, 2014 by olddog
Posted by arnierosner
Written By Anna von Reitz
At first base you learned that what you have been thinking of as “your government” is in fact a private, foreign, for-profit governmental services corporation called the UNITED STATES. This entity is owned and operated by the INTERNATIONAL MONETARY FUND, which is an agency of the UN. The UNITED STATES, INC. has fifty “STATE” franchises doing business as the “STATE OF OHIO” and the “STATE OF WISCONSIN” and so on, just as Burger King or Sears or Dairy Queen have local franchises.
An earlier private, for profit governmental services corporation known as the United States of America, Incorporated, functioned from 1868 to 1933 when it entered into bankruptcy reorganization and remained in Chapter 11 from 1933 to July 1, 2013. It had fifty “federal state” franchises operating as the “State of Ohio” and “State of Georgia” and so on, too—-all part of the “Federal Reserve System”. The Federal Reserve was organized under the auspices of a foreign nation calling itself the United States of America (Minor) composed of what are more normally thought of as the “federal territories and possessions”—-Guam, Puerto Rico, American Virgin Islands, American Samoa, et alia.
So at the same time during most of your life there have been two “federal governments”—that is, “federal” governmental services corporations— operating side by side in collusion to defraud you. When FDR bankrupted the United States of America, Inc. he and his “Governors”— the federal State franchise owners—pledged the “good faith and credit” of “their states and the citizenry thereof” as “sureties” backing the debts of the bankrupt corporation during its reorganization.
The UNITED STATES, INC. took up where the United States of America, Inc. left off, and simply passed through all its charges for services directly to the presumed sureties—- us. The problem is that we never consented under conditions of full disclosure to be “federal” states nor “federal” citizens. It was merely self-interested “policy” of these corporations and their creditors to “presume” that we were all “voluntary sureties” and to plunder our estates and “indebt” us for their spending.
They never told us all the lies and processes they employed to justify and accomplish this identity theft and fiduciary trust fraud used to usurp our natural position as beneficiaries of our own estates and to instead name their corporations as both the comptrollers and beneficiaries of our labor, our lives, our relationships, our businesses, our homes, and our land.
Now, you are going to learn and thoroughly understand that part of it.
Let’s use the name of the present “Secretary of the Treasury”—- “jacob joseph lew” as the name in our example, in hopes that he may get the point.
First, let’s look at Secretary Lew’s birth state: New York.
This is the original “State of New York” one of the original Thirteen (E)states that joined together as the united States of America. Notice that “united” is just an adjective describing a union or association or as they put it, a “perpetual confederation” of these landed “(E)states” The actual name of this country is the “States of America”. The actual and still very much in effect document binding the states together is The Articles of Confederation (1781).
Any idea that any “Constitution” dissolved or replaced the Articles of Confederation is a self-serving lie perpetuated by those who would defraud and enslave you. The “Constitution” —-the real Constitution— is an equity contract and public trust indenture that neither describes the states in terms of their geography nor binds them together in any way except as mutual subscribers to the governmental services to be provided by the “contract government”.
The 1824 Edition of the Webster’s Dictionary clearly states that the word “federal” was a synonym for “contract”, a usage and convention used repeatedly in relation to other documents of the time. It will help you to de-program if every time you see the words “federal government” you instead insert “contract government”—-for that is what it is. It is and has always been a foreign, maritime entity under contract to provide nineteen enumerated governmental services to the subscribing American states. The Constitution, like all Constitutions, is a debt agreement stipulating the services under contract, the limits of the authorities granted, and the payment terms.
This commercial contract is NOT what created your country and formed the Union of States. It merely helped to “perfect” the Union by providing common defense, common currency, and common administration of certain mutually agreed upon services. It also set common limits on the “federal government” in its administration of these mutual services to be provided to the subscribing states.
When we talk about a “state”, even a geographically defined “state” we must be aware that we are talking about a fictional entity. It doesn’t really exist, except via social agreement and convention. In truth there are no state borders established by God, no painted line etched by Heaven to separate New York from New Jersey, and when you go to Court and are accused or judged by anything calling itself the “State of New York” or “STATE OF NEW JERSEY” it is not the land and water of these states that levels the charges or claims to be injured or rises up to accuse you.
All such “States” are fictional in nature, including the original States of the Union bound together by The Articles of Confederation.
Little baby “jacob joseph lew” is born on the land of the American organic, geographically defined New York State. He is given his individual name— his “given name” which is “jacob joseph” by his parents and he inherits his family surname “lew” from his father. Properly, his name as a living baby must be either denoted in all small letters as shown here, or he must be described, as in “Joseph-Jacob of the House Lew”. These are the only proper and lawful ways to name a living freeborn child, and it has been that way since the days of ancient Rome. He is born as a civilian on the jurisdiction of the land, and as a natural –born American, he has complete civil authority. Even as a baby little jacob joseph lew possessed more civil authority on the land of New York State than the entire federal government, but he was blissfully unaware of that fact.
So we’ve already learned some important arcane information here: how to properly and lawfully name a living baby, how to name a land-based geographically defined “state”—-it’s “New York State”— versus a legal fiction political state—the “State of New York” created by social agreement and convention. Little jacob-joseph:lew was thus born on the land of New York State, and, at the same time, inthe State of New York.
We’ve already determined that he was born on the land as a civilian and with complete civil authority on the land, but what does this additional status of being born in the “State of New York” confer? We walk on the land and we swim in the water. This second, political status falls under maritime jurisdiction. Jacob-joseph is still a civilian, so the “State of New York” operates in civil maritime.
To denote this fundamental difference in jurisdiction between the land and the sea, jacob joseph lew’s name on the land is “restyled” as “Jacob Joseph Lew”.
So you now have one baby, two names, and two completely separate jurisdictions— jurisdictions that are as absolutely and endemically separate from each other as the land and the sea.
Civil maritime is the jurisdiction in which merchant mariners and commercial “vessels” trade and sail the seas, so perhaps it is not awfully surprising that Federal Title 7 considers “Jacob Joseph Lew” a “vessel” and the Internal Revenue Code describes him as a warrant officer in the Merchant Marine Service when he exercises his “office” as a “withholding agent” working for an offshore Puerto Rican trust operated under the name “JACOB JOSEPH LEW”.
This third version, “JACOB JOSEPH LEW” appears shortly after “Jacob Joseph Lew” is “registered” by agents under contract to the Federal Reserve System as a vessel belonging to the United States of America, Incorporated.
Say, what? Yes, those nice people at the New York Bureau of Vital Statistics aren’t working for the New York State. They are working for the State of New York. And the “State of New York” is a “federal state franchise” of the United States of America, Incorporated, which was owned and operated by the Federal Reserve System under the auspices of a foreign nation calling itself “the United States of America (Minor)”—–though they very rarely bother to include the word (Minor). This “other United States” is composed of a consortium of “American” “States” more often thought of as federal territories and possessions, including Guam, Puerto Rico, American Samoa, American Virgin Islands and “Other Insular States”. It’s a private corporation organized under the auspices of a foreign country operating “state” franchises in our midst.
All your life you have never used your real name or enjoyed your birthright or your God-given freedom, because these interlopers came to your Mother under conditions of non-disclosure and self-interested deceit by committing fiduciary trust fraud, they pushed your Mother to unknowingly donate you as chattel “entrusted” to their corporation— their “state” franchise” doing business as the “State of New York”, which allowed them to claim that you were “voluntarily” renouncing your birthright status as a civilian on the land of the New York State, and agreeing instead to be “enfranchised” and made “subject” to the “territorial jurisdiction” of the United States of America (Minor).
In one stroke, your misled and purposefully entrapped Mother gave this foreign, for-profit, private “State” franchise of the bankrupt United States of America, Incorporated (and their owners, the Federal Reserve Banks) legal title to you. Mrs. Lew was never told anything about the nature of the paperwork she was signing, but the “State of New York” became the trustee of little jacob joseph lew. And their very first act was to abuse the right of usufruct— the right of trustees to use the name of the beneficiary, so long as no harm is done to the beneficiary or their reputation.
You be the judge of the ultimate harm they have done to you and millions of others.
They immediately “redefined” jacob-joseph (and you) as a “US citizen” subject to the whims of the “United States Congress” acting as the government of the United States of America (Minor), a foreign, maritime, legislative democracy. This removed him— literally kidnapped him—from his natural jurisdiction on the land of New York State where he was born free and entitled to all his Natural and Unalienable rights—-and “subjected” him—as in “subject to a king” to the laws and jurisdiction of this foreign nation and its “territorial jurisdiction” and also made him a “surety” for the debts of the same “United States Congress” and the bankrupt “United States of America, Incorporated”. They enslaved him and you and millions of others.
Instead of acting as his Trustee, the “State of New York” acted as a predator and changed the baby’s name to “Jacob Joseph Lew”. This is the way he was taught to refer to himself and the way he was taught to sign his name and that allowed the legal presumption that he was knowingly and willingly and voluntarily operating in their foreign civil maritime “territorial jurisdiction” as a “vessel in commerce” belonging to the “State of New York” —a franchise of the bankrupt United States of America, Incorporated, organized under the auspices of the United States of America, (Minor).
This is a sophisticated form of identity theft carried out against unsuspecting women and babes in their cradles by international banking cartels operating governmental services corporations under conditions of gross self-interested fiduciary trust fraud and deceit.
Next, the operators of this fraud scheme issued bonds based on jacob-joseph’s estimated lifetime earnings, next, they had the baby born on the land declared “legally dead” and committed probate fraud against him, then, they acted as creditors against his earthly estate and filed maritime salvage liens against his “vessel” for his estimated “share” of the expenses of the United States of America, Incorporated—-known as the “National Debt”.
All this was done to jacob-joseph and to you and virtually every other child born on the land of the State of America before anyone left grade school. You were systematically entrapped, defrauded, kidnapped, transported to a foreign jurisdiction, suffered identity theft and mischaracterization, and were robbed of your natural rights and immunities by corporations in your employment and by individuals and institutions pretending to “represent” your lawful government and to act as your “trustees”.
This was done without your knowledge or consent on the basis of Third Party contracts (entered by the Franklin Delano Roosevelt Administration and your Mother) and under conditions of semantic and material deceit resulting in tainted, unilateral, undisclosed and grossly inequitable contracts serving to demean and enslave you.
After they killed off the baby born on the land via this legalized identity theft, the perpetrators settled in as parasites to feed off your labor and to “hypothecate” debt against your land, your homes, your businesses and everything else naturally belonging to you. The hired help— governmental services corporations merely under contract to provide stipulated services to the States—stole your identity, your credit cards, and your earthly estate—and proceeded to lord it over you, all without your knowledge or consent.
The facts of the fraud are revealed by “your” Birth Certificate, which is actually your fraudulent Death Certificate. Look at this document closely. It is issued by the Registrar, an Officer of the Probate Court— proof positive that your earthly estate has been probated. It is issued on bond paper, representing a debt and “promise to pay” bonds that have been issued based on the value of your earthly ESTATE, all numbered and securitized to benefit the United States of America, Incorporated and the very bankers and lawyers and politicians responsible for this deplorable criminality. It is issued to your given name styled in all capital letters, or in our example, to “JACOB JOSEPH LEW”.
This particular incorporated entity is an ESTATE trust created under Washington, DC Municipal Statute, Chapter 2, Vital Statistics, Section 7-201, paragraph 10. It is created under the auspices of the Washington, DC Municipality, a separate, independent, international city-state ruled as a plenary oligarchy by the members of the US CONGRESS, which acts as a Board of Directors for the UNITED STATES, INCORPORATED, which as you learned at First Base, owned and operated by the INTERNATIONAL MONETARY FUND, an agency of the UNITED NATIONS CORPORATION.
Right now, because the bankruptcy of the United States of America, Incorporated, finally settled on July 1, 2013, the parasites are setting up shop with new hosts—-the United Nations City State located in New York State. They are booting up a new “FEDERAL RESERVE” under UN auspices and launching a new UNITED STATES OF AMERICA, INCORPORATED, and attempting to roll over the old ESTATE trusts operated under names styled as in “JACOB JOSEPH LEW” and to “redefine” what is left of “you” as a transmitting utility operated as “JACOB J. LEW”.
If we don’t put a stop to this craziness ourselves every commercial corporation and petty despot on earth will be misusing our names and naming legal fiction entities after us and claiming to have contracts and relationships with “them” and us that don’t exist and accusing us of owing their debts or owing them for services we never ordered, and similar outrages.
We will have not only the New York State and the State of New York (old Federal Reserve version) and the STATE OF NEW YORK (IMF version) and NEW YORK (their latest outrage), but we will have The state of new York, and the State of new York, and the New State of York and the State of New york and the new state of york, and as many permutations of style and spelling and order of words you can imagine —–all of which are created for the sole purpose of semantic deceit, identity theft, and criminal fraud.
It’s time to bluntly accuse these false trustees of the crimes they have committed and continue to commit against the Americans, Australians, Canadians, most Europeans, Japanese, and others who have been victimized by the same or very similar “Systems” of fraud and enslavement perpetuated by these international banking cartels, the Bar Associations, and criminal politicians.
Right now, the push is on to “consolidate sovereign debt” and use it as leverage against all the nations and governments of the world and to give control of this leverage to the handful of evil geniuses running the UNITED NATIONS CORPORATION. The problem is that no such legitimate debts exist, and because of the fraud involved, no valid claims can be addressed to any of the people of any country. This mammoth faux pas and accounting nightmare has been caused by criminally corrupt governments, bankers, and lawyers—-and yes, by people who have been complacent and who have bought into the propaganda and the lies spun by these self-interested con artists for generations.
Now you know how the spiders spin their webs and you know how you wound up “removed” to Puerto Rican jurisdiction, paying debts you don’t owe, and so much more.
Tell your friends. Tell your neighbors. Set up your Grand Juries. Elect your Sheriffs and Judges to execute the Law of the Land against these hyenas. Boycott them and refuse service and refuse to pay any taxes for unwanted services. Serve your Notices to the members of Con- Gress that they do NOT “represent” you and do NOT represent your organic state. Do the same with the so-called Governors. Don’t let anyone or anything “represent” you. Show up and present yourself. Bring suit against the probate court for fraud perpetuated against you. File liens and commercial affidavits against these corporations, judges, clerks, lawyers, bankers, politicians—-the whole kit and caboodle. They aren’t “public officials”. None of them have taken a single proper oath of any public office. They are nothing but private corporate “officers” impersonating lawful public officials—-criminals, in other words. They are all con artists knowingly or unknowingly occupying vacated public offices and abusing the assumed “powers” of those offices for private gain.
Most of all, inform the sheriffs, police, provost marshals, militia members, and members of the military. Educate them so that they have no excuse for condoning, supporting, or enforcing the “acts” and “orders” of these charlatans.
December 1st, 2014 by olddog
There has only been one other time in history when the price of oil has crashed by more than 40 dollars in less than 6 months. The last time this happened was during the second half of 2008, and the beginning of that oil price crash preceded the great financial collapse that happened later that year by several months. Well, now it is happening again, but this time the stakes are even higher.
When the price of oil falls dramatically, that is a sign that economic activity is slowing down. It can also have a tremendously destabilizing effect on financial markets. As you will read about below, energy companies now account for approximately 20 percent of the junk bond market. And a junk bond implosion is usually a signal that a major stock market crash is on the way. So if you are looking for a “canary in the coal mine”, keep your eye on the performance of energy junk bonds. If they begin to collapse, that is a sign that all hell is about to break loose on Wall Street.
It would be difficult to overstate the importance of the shale oil boom to the U.S. economy. Thanks to this boom, the United States has become the largest oil producer on the entire planet.
Yes, the U.S. now actually produces more oil than either Saudi Arabia or Russia. This “revolution” has resulted in the creation of millions of jobs since the last recession, and it has been one of the key factors that has kept the percentage of Americans that are employed fairly stable.
Unfortunately, the shale oil boom is coming to an abrupt end. As a recent Vox article discussed, OPEC has essentially declared a price war on U.S. shale oil producers…
For all intents and purposes, OPEC is now engaged in a “price war” with the United States. What that means is that it’s very cheap to pump oil out of places like Saudi Arabia and Kuwait. But it’s more expensive to extract oil from shale formations in places like Texas and North Dakota. So as the price of oil keeps falling, some US producers may become unprofitable and go out of business. The result? Oil prices will stabilize and OPEC maintains its market share.
If the price of oil stays at this level or continues falling, we will see a significant number of U.S. shale oil companies go out of business and large numbers of jobs will be lost. The Saudis know how to play hardball, and they are absolutely ruthless. In fact, we have seen this kind of scenario happen before…
Robert McNally, a White House adviser to former President George W. Bush and president of the Rapidan Group energy consultancy, told Reuters that Saudi Arabia “will accept a price decline necessary to sweat whatever supply cuts are needed to balance the market out of the US shale oil sector.” Even legendary oil man T. Boone Pickens believes Saudi Arabia is in a stand-off with US drillers and frackers to “see how the shale boys are going to stand up to a cheaper price.” This has happened once before. By the mid-1980’s, as oil output from Alaska’s North Slope and the North Sea came on line (combined production of around 5-6 million barrels a day), OPEC set off a price war to compete for market share. As a result, the price of oil sank from around $40 to just under $10 a barrel by 1986.
But the energy sector has been one of the only bright spots for the U.S. economy in recent years. If this sector starts collapsing, it is going to have a dramatic negative impact on our economic outlook. For example, just consider the following numbers from a recent Business Insider article…
Specifically, if prices get too low, then energy companies won’t be able to cover the cost of production in the US. This spending by energy companies, also known as capital expenditures, is responsible for a lot of jobs.
“The Energy sector accounts for roughly one-third of S&P 500 capex and nearly 25% of combined capex and R&D spending,” Goldman Sachs’ Amanda Sneider writes.
Even more troubling is what this could mean for the financial markets.
As I mentioned above, energy companies now account for close to 20 percent of the entire junk bond market. As those companies start to fail and those bonds start to go bad, that is going to hit our major banks really hard…
Everyone could suffer if the collapse triggers a wave of defaults through the high-yield debt market, and in turn, hits stocks. The first to fall: the banks that were last hit by the housing crisis.
Why could that happen?
Well, energy companies make up anywhere from 15 to 20 percent of all U.S. junk debt, according to various sources.
It would be hard to overstate the seriousness of what the markets could potentially be facing.
One analyst summed it up to CNBC this way…
“This is the one thing I’ve seen over and over again,” said Larry McDonald, head of U.S strategy at Newedge USA’s macro group. “When high yield underperforms equity, a major credit event occurs. It’s the canary in the coal mine.“
The last time junk bonds collapsed, a major stock market crash followed fairly rapidly.
And those that were hardest hit were the big Wall Street banks…
During the last high-yield collapse, which centered around debt tied to the housing sector, Citigroup lost 63 percent of its value in the following 60 days, Kensho shows. Bank of America was cut in half.
I understand that some of this information is too technical for a lot of people, but the bottom line is this…
Watch junk bonds. When they start crashing it is a sign that a major stock market collapse is right at the door.
At this point, even the mainstream media is warning about this. Just consider the following excerpt from a recent CNN article…
That swing away from junk bonds often happens shortly before stock market downturns.
“High yield does provide useful sell signals to equity investors,” Barclays analysts concluded in a recent report.
Barclays combed through the past dozen years of data. The warning signal they found is a 30% or greater increase in the spread between Treasuries and junk bonds before a dip.
If you have been waiting for the next major financial collapse, what you have just read in this article indicates that it is now closer than it has ever been.
Over the coming weeks, keep your eye on the price of oil, keep your eye on the junk bond market and keep your eye on the big banks.
Trouble is brewing, and nobody is quite sure exactly what comes next.
This article first appeared here at the Economic Collapse Blog. Michael Snyder is a writer, speaker and activist who writes and edits his own blogs The American Dream and Economic Collapse Blog. Follow him on Twitter here.
September 23rd, 2014 by olddog
BY I M POWER / WEDNESDAY, 17 SEPTEMBER 2014 / PUBLISHED IN ABSOLUTE DATA
The Economist: Mainstream globalist propaganda reveals East/West conflict is a farce
published on redifinggod blog, on September 15, 2014
For anyone who might still believe that the US/NATO versus Russia/BRICS geopolitical confrontation is real…
…here is a little blast from the past…
…It is the cover from the January 9, 1988 issue of The Economist magazine. Note the phoenix rising from the ashes of burning national currencies, including the dollar.
The cover relates to an article on pages 9-10 titled Get ready for the phoenix, which foretold the financial drama we are now watching unfold in real time. Upon stumbling across them, I found the cover art and the article so striking that I thought they might be an online forgery, so I verified their authenticity with a research librarian at the Newspaper and Current Periodical Room of the Library of Congress. Both the cover and the article are quite real. Here are some excerpts (not necessarily in the order in which they appear in the article)…
>>> THIRTY years from now, Americans, Japanese, Europeans, and people in many other rich countries, and some relatively poor ones will probably be paying for their shopping with the same currency. Prices will be quoted not in dollars, yen or D-marks but in, let’s say, the phoenix. The phoenix will be favoured by companies and shoppers because it will be more convenient than today’s national currencies, which by then will seem a quaint cause of much disruption to economic life in the last twentieth century…
…The phoenix would probably start as a cocktail of national currencies, just as the Special Drawing Right is today. In time, though, its value against national currencies would cease to matter, because people would choose it for its convenience and the stability of its purchasing power…
…The phoenix zone would impose tight constraints on national governments. There would be no such thing, for instance, as a national monetary policy. The world phoenix supply would be fixed by a new central bank, descended perhaps from the IMF…
…Governments are far from ready to subordinate their domestic objectives to the goal of international stability. Several bigger exchange-rate upsets, a few more stock-market crashes and probably a slump or two will be needed before politicians are willing to face squarely up to that choice…
…Pencil in the phoenix for around 2018, and welcome it when it comes. <<<
It’s all there: the SDR “cocktail” (basket) of currencies, the IMF’s central role, and the need to create “exchange rate upsets, stock-market crashes, and economic slumps” to make the public accept it. Seeing such an accurate forecast/blueprint, one wonders who was behind its publishing. So if we look into The Economist magazine, we find it is headquartered just a few blocks from the City of London and is owned by The Economist Group, which itself is owned by some rather interesting characters…
“The Economist Group is 50% owned by Pearson PLC via The Financial Times Limited. The bulk of the remaining shares are held by individual shareholders including the Cadbury, Rothschild, Schroder, Agnelli and other family interests as well as a number of staff and former staff shareholders.”
Beyond the Rothschild and Agnelli families, who are widely rumored to be part of the Illuminati, the Schroder family is particularly worth noting. The Schroders (also spelled Schroeder) are an old German ruling class family from Hamburg. One of the Schroder brood, Johann Heinrich Schroder, settled in London and founded J. Henry Schroder & Co. (now known simply as “Schroders,” one of the UKs largest investment banks) back in 1818. Later, in 1923, the firm expanded into New York by establishing J. Henry Schroder Banking Corporation. It is here that they joined with the Rockefeller family through Avery Rockefeller.
According to Avery’s bio…
“In 1928, Rockefeller joined the storied J. Henry Schroder Banking Corporation and became Assistant Treasurer in 1931. On 8 July 1936, Rockefeller co-founded Schroder, Rockefeller & Co., Inc. Its purpose was to take over the underwriting and general securities business formerly carried out by the J. Henry Schroder Banking Corporation.”
Schroder, Rockefeller & Co. is widely viewed as having been an integral part of the globalist bankers’ financial support infrastructure for the Nazis. And another of the Schroders, Johann Heinrich’s great-grandson, Baron Kurt von Schroeder
(shown here in his Nuremberg picture)…
…played a pivotal role..
“Schroeder was an important member of the Freundeskreis der Wirtschaft, which provided Adolf Hitler and his party with enough financial support to survive through the early 1930s. He also hosted a critical meeting on 4 January 1933 between Papen and Hitler that eventually led to Hitler’s appointment as Chancellor of Germany.”
The Nazis had (and continue to have) deep ties to the Anglo-American banking establishment, and also to The Economist. So this article came from a publication connected to the supposed “Nazi/Zionist Cabal.” Keep this in mind as we take a look at what that Cabal’s supposed enemies, the Chinese, are saying about the currently-unfolding global financial drama.
The Blueprint Revealed
I recently ran across a China Daily article titled Bracing for next big financial crisis, written by Giles Chance (a former World Bank staffer who is a professor at the Guanghua School of Management at Peking University). I strongly recommend following the link and reading the entire article, because it succinctly lays out the globalist plans and talking points for the next economic crisis. Once you correct for the article’s spin, it tells you everything. Here are some select passages, with my commentary added in brackets…
>>> Above the central banks, including the PBOC [People’s Bank of China], stands the Bank of International Settlements in Basel, Switzerland, which oversees the activities of national banking and monetary systems. The integration of markets and economies in a globalized world has given the BIS an increasingly important role in providing global financial stability… <<<
[So here we have a Chinese propaganda organ telling us that the BIS is in charge of all the central banks, including China’s. This is in spite of the fact that the BIS was a joint creation of the London bankers and the Nazis (who are supposedly the bad guys the BRICS are fighting). I will share more about the BIS later in the article.]
>>> In 2007, the year before the financial crash, the BIS warned that the global financial system was becoming overstretched and that the banking systems in the developed world were coming under pressure. But although the BIS has great influence, it does not have the power to compel any central bank. It can advise and warn, but it cannot give orders, and it does not issue its own money. As we know, the Federal Reserve Bank of New York and the European Central Bank in Brussels did not act on the well-timed warning from the BIS. <<<
[This passage establishes the BIS’s wisdom and foresight, as opposed to the foolishness of the national central banks. It also carries the implication that the BIS should be given the power to compel the national central banks to follow its wise guidance. Not mentioned is the fact that the financial crash was deliberately triggered by the very bankers he’s writing about, and that the foolishness of the national central banks’ responses was quite calculated. It allowed the banksters to harvest enormous wealth from the public and set up the pretext for the global institutions to step in and “provide stability.”]
>>> Against that background, you would expect today that if the BIS issued another warning, the world would pay attention. At the end of June, BIS General Manager Jaime Caruana gave a speech at its headquarters that contained a strong note of caution: “A new policy compass is needed to help the global economy step out of the shadow of the global financial crisis…” <<<
[By “a new policy compass,” he means a transition from the current dollar-based global financial system to the new, more centralized SDR-based multipolar/multilateral financial system]
>>> In his speech, Caruana blamed the continued dependence by the advanced economies, led by the United States, on ultra-loose monetary policy in place of the necessary deep-seated structural changes. <<<
[Here, he’s setting up the Federal Reserve (and the EU and Japan) to take the blame.]
>>> Caruana’s warning was reinforced by William White, head of the Economic Review and Development Committee at the headquarters of the Organization for Economic Co-operation and Development in Paris. As one of the very few experts who accurately forecast the 2008 crash, while head of research at the BIS, White is listened to with respect around the world.
In a recent interview, he said: “Riskfree bond rates are at enormously low levels, spreads are very low … it all looks and feels like 2007. And frankly, I think it’s worse than 2007…” <<<
[Here, another “wise” person from the BIS is warning that we’re approaching another financial crisis (that he and his buddies are engineering). It’s pretty easy to be a forecaster when you’re in on the plan. So if this year looks and feels like 2007, will next year be the next 2008?]
>>> But the US Federal Reserve Bank, the controller of the dollar-based global economy, does not agree with the BIS or William White. Several days after Caruana’s speech, Fed Governor Janet Yellen made it clear that she does not think that extremely low interest rates were the main culprit in the 2008 financial crisis, nor constitute the main problem now. <<<
[This is a very instructive passage. Note how the author specifically mentions the “dollar-based global economy.” Also note how he again paints the Federal Reserve as the morons who won’t listen to the sage globalists at the BIS. In this, he is setting up Janet Yellen for her upcoming scapegoat role, and he is tying interest rates to what will bring her down. The author says all this while failing to disclose that Janet Yellen is a member of the Board of Directors of the BIS, as is PBOC governor Zhou Xiaochuan]
>>> The disagreement between these two powerful financial institutions, the BIS and the New York Federal Reserve, has increased the risk that markets will crash as interest rates rise. Can China’s stability withstand another financial crash? Or would China emerge stronger? <<<
[Bingo! Here we are shown the trigger for the next financial crisis: Yellen will raise interest rates either “too soon” or by “too much” and crash the markets. “If only the wise BIS had had the power to rein in the Fed’s foolishness sooner, we could have avoided this,” they’ll say. Now let’s read on and see if China will emerge stronger.]
>>> China certainly has economic problems… But the forward-looking, courageous determination of its government to grasp some important nettles in its economic reform program will make it a key part of any solution to another Western financial crisis. <<<
[Here, the author does the requisite ass-kissing to his Chinese hosts, then boldly states that China will be “a key part of any solution to another Western financial crisis.” Solution, as in problem – reaction – solution. And the article has already shown us who caused the problem part of the equation: the unruly Western central banks, especially the Fed.]
>>> With the BIS and the US Federal Reserve Bank on opposite sides of the fence about global financial stability, the likelihood of another global financial crisis grows. But next time would indeed be different, because Western taxpayers would refuse to pay for another huge bank bailout, as they did in 2008-09. <<<
[So again, in case you missed it: BIS = good = wise = solution and US Federal Reserve Bank = bad = problem = another global financial crisis.]
>>> The emerging world, led by China, is economically in a much stronger position relative to the advanced countries than six years ago. Although in 2009 China may not have expected its sudden promotion to world power status, the country’s emergence since the crash as a global pillar of growth has significantly increased its global influence. <<<
[China didn’t expect its promotion to world power status? Au contraire, they knew it was coming because the globalists promised it to them, just like they promised what comes next…]
>>> Another crash on Wall Street would reinforce the attraction of the renminbi as a store of value and anchor of stability for other regional currencies…
It would underpin China’s global appeal as a peaceful force for stability in a volatile and troubled world, and hasten the re-engineering of shareholding in the major organizations of global governance, particularly at the World Bank and the IMF. Prepared or not, in the event of another crash China would find itself in a position of even greater global leadership and responsibility than today. <<<
[So here we are told that the next crash will be China’s gateway to top dog status, and it will “hasten the re-engineering of shareholding in the major organizations of global governance, particularly at the World Bank and the IMF.” This is exactly what I’ve been warning about. When the next crash comes, watch them break out their gold and other commodities to underwrite the global financial system in exchange for the governance changes.]
Now that we are done de-spinning the article, there are two things it brings up that deserve to be examined: the BIS and the Fed’s raising of interest rates…
The Bank for International Settlements (BIS)
This is the cover art for the BIS Archive Guide…
…It proudly features Montagu Norman (the Bank of England Governor from 1920-1944, circled in pink) and Hjalmar Schacht (the President of the Reichsbank from 1923-31 and 1933-39, and Hitler’s Economics Minister from 1934 – 1937, circled in red). You’ll hear more about these two a little later in the article. But first, let’s have a look at a little piece of BIS history…
>>> Between 1933 and 1945 the BIS board of directors included Walther Funk, a prominent Nazi official, and Emil Puhl, who were both convicted of war crimes at the Nuremberg trials after World War II, as well as Hermann Schmitz, the director of IG Farben, and Baron [Kurt] von Schroeder, the owner of the J.H.Stein Bank, which held the deposits of the Gestapo. There were allegations that the BIS had helped the Germans loot assets from occupied countries during World War II.
As a result of these allegations, at the Bretton Woods Conference held in July 1944, Norway proposed the “liquidation of the Bank for International Settlements at the earliest possible moment”. This resulted in the BIS being the subject of a disagreement between the American and British delegations. The liquidation of the bank was supported by other European delegates, as well as the United States (including Harry Dexter White, Secretary of the Treasury, and Henry Morgenthau), but opposed by John Maynard Keynes, head of the British delegation.
Fearing that the BIS would be dissolved by President Franklin Delano Roosevelt, Keynes went to Morgenthau hoping to prevent the dissolution, or have it postponed, but the next day the dissolution of the BIS was approved. However, the liquidation of the bank was never actually undertaken. In April 1945, the new U.S. president Harry S. Truman and the British government suspended the dissolution, and the decision to liquidate the BIS was officially reversed in 1948. <<<
So why were the British bankers so opposed to shutting down a bank with strong Nazi ties, you ask? Well, have a look at this UK Telegraph article (use this Internet Archive link if the direct link isn’t working)…
I recommend reading the whole article, as it contains more juicy information than I can include in this post. Here are the most relevant excerpts for the topic at hand (with my comments in brackets)…
>>> The BIS was founded in 1930, in effect by Montagu Norman and his close friend Hjalmar Schacht, the former president of the Reichsbank, known as the father of the Nazi economic miracle. Schacht even referred to the BIS as “my” bank. The BIS is a unique hybrid: a commercial bank protected by international treaty. Its assets can never be seized, even in times of war. It pays no taxes on profits…
A key sentence in the Bank of England documents is found on page 1,295. It reads: “The general attitude of the Bank of England directors of the BIS during the war was governed by their anxiety to keep the BIS to play its part in the solution of post-war problems”… [the bankers created the problem (World War 2), and they used the BIS to institute their solution (more centralized control of the world’s financial systems)]
…And here the secret history of the BIS and its strong relationship with the Bank of England becomes ever more murky.
During the war the BIS proclaimed that it was neutral, a view supported by the Bank of England. In fact the BIS was so entwined with the Nazi economy that it helped keep the Third Reich in business. It carried out foreign exchange deals for the Reichsbank; it accepted looted Nazi gold; it recognized the puppet regimes installed in occupied countries, which, together with the Third Reich, soon controlled the majority of the bank’s shares.
Indeed, the BIS was so useful for the Nazis that Emil Puhl, the vice-president of the Reichsbank and BIS director, referred to the BIS as the Reichsbank’s only “foreign branch”…
Every other month it hosts the Global Economy Meetings, where 60 of the most powerful central bankers, including Mark Carney, Governor of the Bank of England, meet. No details of meetings are released, even though the attendees are public servants, charged with managing national economies.
The BIS also hosts the Basel Committee on Banking Supervision, which regulates commercial banks, and the new Financial Stability Board, which coordinates national regulatory authorities. The BIS has made itself the central pillar of the global financial system. <<<
Speaking of these Global Economy Meetings, guess who attends them? According to the BIS website…
“The GEM comprises the Governors of 30 BIS member central banks in major advanced and emerging market economies that account for about four fifths of global GDP. The members of the GEM are the central bank Governors from Argentina, Australia, Belgium, Brazil, Canada, China, France, Germany, Hong Kong SAR, India, Indonesia, Italy, Japan, Korea, Malaysia, Mexico, the Netherlands, Poland, Russia, Saudi Arabia, Singapore, South Africa, Spain, Sweden, Switzerland, Thailand, Turkey, the United Kingdom and the United States and also the President of the European Central Bank and the President of the Federal Reserve Bank of New York. Governors from several other central banks attend the GEM as observers.”
So as you can see, beyond the public theater offered in Ukraine and the Middle East, and beyond all the East versus West propaganda offered in the mainstream and alternative media, China and the BRICS are dancing to the tune of the BIS puppet-masters just like everyone else. There is NO CONFLICT between “Nazi/Zionist” transatlantic bankers and BRICS bankers. In fact, Chinese and Russian banks (along with everyone else) are in the process of implementing the Basel 3 bank reforms put out by the Basel Committee on Banking Supervision, which is hosted by the BIS.
According to this China Daily article…
“Under China’s implementation of Basel III guidelines, systemically important banks need a minimum Tier 1 capital ratio of 9.5 percent, with total buffers of 11.5 percent, before the end of 2018.”
…and according to this Russia Today article…
“Basel III – a new set of global banking standards scheduled to come into force in Russia this year – should become another stimulus for the country’s lenders to rely on its own funds rather than State support. One of the key Basel III requirements is tighter rules for a banks’ own capital.”
The whole East versus West propaganda campaign is aimed at giving the hypnotized public a fairytale storyline for all the changes they’re going through. It also offers them scapegoats on whom they can pin all their problems. The international bankers are going to crash the current system and blame it on the Federal Reserve, then they’re going to introduce the BRICS as the heroes who save the day.
In fact, part of the purpose for the recent creation of the BRICS Bank is to give the BRICS a lifeboat while the West founders from the crash. The BRICS Contingent Reserve Arrangement…
“is a framework for the provision of support through liquidity and precautionary instruments in response to actual or potential short-term balance of payments pressures.
The objective of this reserve is to provide protection against global liquidity pressures. This includes currency issues where members’ national currencies are being adversely affected by global financial pressures.
The Bank would also provide assistance to other countries suffering from the economic volatility in the wake of the United States’ exit from its expansionary monetary policy.“
All this being said, when will the crash begin, and how long will it last? Given that the last crash lasted from 2007-2009 and contained a shocking “Lehman Moment,” it stands to reason that the next crash would also be a slow-motion train wreck with an even more shocking Lehman Moment. If the propaganda setup for the collapse is any indicator, the train wreck and New Lehman Moment will involve the raising of the Fed interest rate by Janet Yellen and perhaps a black swan event like a false-flag cyberattack or terrorist attack.
Looking at the interest rate component, the Fed will be meeting this Tuesday and Wednesday (September 16-17), and that could give us an indication of when things might kick off. The general consensus of the Fed watchers seems to be that interest rates will go up starting in the summer of 2015, with some estimates saying as early as March 2015. Will this start the train wreck? And since the BRICS bank isn’t scheduled to start lending until 2016, the New Lehman might not happen till then. But then again, they can always surprise us.
August 2nd, 2014 by olddog
Over a year ago I published an essay entitled ‘The Linchpin Lie: How Global Collapse Will Be Sold To The Masses’. This essay addressed efforts by the ever malicious Rand Corporation to create a false narrative surrounding the possibility of global collapse. Linchpin Theory, as it was named by it’s originator and Rand Corp. employee, John Casti, is I believe the very future of propaganda.
Every engineered crisis needs a clever cover story, and in Linchpin Theory, we are told that all human catastrophe is a mere natural product of the “over complexity” within various systems. Yes, there is no accounting of false flag geopolitics or elitist conspiracy, no acknowledgment of deliberately initiated chaos; such things do not exist in the world of “linchpins”. Rather, the Rand Corporation would have us believe that the world is a massive game of Jenga, and the supporting pieces just remove themselves from the teetering structure by magical and coincidental causality.
Today, the linchpin lie is now being carefully inserted into the mainstream narrative. I can’t say I was shocked to hear Alan Greenspan use its basic premise when he recently stated that:
I have come to the conclusion that bubbles…are a function of human nature. We don’t have enough observations, but my tentative hypothesis to what we’re dealing with is that both a necessary and sufficient condition for the emergence of a bubble is a protracted period of stable economic activity at low inflation. So it is a very difficult policy problem. I do believe that central banks that believe they can quell bubbles are living in a state of unrealism.
It is important that we understand what Greenspan is actually doing here. The former Fed chairman is asserting that economic bubbles like the derivatives bubble of 2008 are a “natural function”, like the seasons, and are out of the control of central bankers. The truth is that central bankers have never tried to “quell” economic bubbles, they have been deliberately creating them in order to position the global economy into a crisis which they can then exploit. Greenspan is not only diverting blame for all the past and future economic crashes central banks have engineered, he is also setting the propaganda stage for a great change in the dynamic of the central banking concept – what the IMF’s Christine Lagarde calls the “global economic reset”.
The current central banking structure gives the illusion of separation and sovereignty. Most people who have not researched the nature of the international banking cartel believe that the Federal Reserve, for instance, is a separate national entity from the Central Bank of Russia, or the Central Bank of China. They believe that these institutions act of their own accord rather than in concert with each other. The reality is, there is no Federal Reserve. There is no Central Bank of Russia. There are no separate entities. There are no Western banks and there are no BRICS. All of these banking edifices are merely front organizations for global financiers, as Council on Foreign Relations insider (and friend to the Rockefellers) Carroll Quigley made clear in his book, Tragedy And Hope:
It must not be felt that the heads of the world’s chief central banks were themselves substantive powers in world finance. They were not. Rather they were the technicians and agents of the dominant investment bankers of their own countries, who had raised them up, and who were perfectly capable of throwing them down. The substantive financial powers of the world were in the hands of these investment bankers who remained largely behind the scenes in their own unincorporated private banks. These formed a system of international cooperation and national dominance which was more private, more powerful, and more secret than that of their agents in the central banks.
A “global economic reset”, I suspect, will consist of a grand shift away from covert cooperation between central banks to an OPENLY centralized one world banking system, predicated on the concepts put forward by the IMF and led by the Bank for International Settlements, which has always been behind the scenes handing down commandments to the seemingly separate central banks of nations.
In order for this “reset” to be achieved, however, the establishment needs a historically monumental distraction. A distraction so confounding and terrifying that by the time the public has a chance to examine the situation rationally, the elites have already tightened the noose.
I have been warning ever since the beginning of the derivatives/debt collapse of 2007/2008 that the international financiers and globalists who created the artificially low interest rates and fiat lending bonanza would one day be required to fashion a considerably dangerous event in order to trigger the final collapse of the dollar based monetary system and replace it with a new currency (or basket of currencies), along with a new centralized financial authority.
This distracting event would have to rely on three very important strategies in order to succeed –
1) The use of what I call the “scattershot effect”; a swarm of smaller crises growing exponentially until it blurs together to create one dynamic calamity.
2) The use of multiple false paradigms in order to confuse the masses and pit them against one another in an absurd fight over fake and meaningless causes.
3) The use of deceptive benevolence on the part of the financial elite as they tap dance in to act as global “mediators”, ready to save the public from itself.
The end result would be a new brand of “world war” rather unique to history.
When most people imagine WWIII, they immediately envision images of nuclear bombs and mushroom clouds; however, I believe that when world war erupts, it may progress far differently from our cinematic assumptions. Regional conflicts are very likely, there is no doubt, but if one places himself in the shoes of the elites, one realizes that all out mechanized nuclear Armageddon is not really necessary to achieve the desired result of global governance.
Economic warfare alone could be extremely effective in initiating full spectrum fiscal implosion as well as mass starvation, mass panic, and mass desperation. All the signs lead me to believe that financial combat and 4th generation warfare will be used in the place of large armies and missiles.
The Scattershot Effect
Consider the sheer scope and number of crisis situations that have reached explosive proportions just in the past six months.
Syria continues to destabilize due to ISIS insurgents supported by the U.S., Saudi Arabia, and Israel; it is a horrifying storm which is now bleeding into other nations such as Iraq.
Iraq is on the verge of complete disintegration as the same western organized ISIS moves towards the outskirts of Baghdad.
Libya has imploded, with the American embassy evacuated, as well as the French and British, as various militias battle for supremacy.
The Ukraine crisis is nearing mutation into another beast entirely after the attack on Malaysian flight MH17. In just the past week, the EU has instituted sanctions against Russia, fighting has become even more fierce around Donetsk, Russia has been accused of firing artillery into Ukraine, and the U.S. now claims that Russia has violated the terms of the Intermediate Range Nuclear Forces treaty.
In the meantime, the Federal Reserve continues to taper QE3 while ignoring the unprecedented equities bubble they have birthed in the stock market, as well as refusing to answer the question as to who will actually buy U.S. Treasury debt if they do not? Our secret friend from Belgium? And what if this secret friend is, as I suspect, actually the IMF/BIS global loan shark duo? What then? Do we become yet another third world African-style debtor owing our very infrastructure to a financial bureaucracy on the other side of the world?
And what about the Baltic Dry Index, one of the few measures of global shipping demand that cannot be manipulated by outside money interests? Well, the BDI is back down to historic lows, falling 65% since January, signaling that the so-called “economic recovery” is not at all what it is cracked up to be.
Add to this the deluge of illegal immigration on the southern border, aided by the Obama Administration, as well as possible presidential impeachment and lawsuit proceedings, and you have a recipe for total chaos of the fiscal variety.
If the first six to seven months of 2014 have been this frenetic, how bad will the next six months be?
We are all aware of the prevalence of the false Left/Right paradigm in American politics. Hopefully most people in the Liberty Movement understand, for example, that any impeachment or lawsuit proceedings against Barack Obama will be nothing more than a crafted circus designed to accomplish nothing – a con game to placate conservatives with useless top-down solutions while the country burns around their ears.
There are other false paradigms that are not so clear to some, though…
The false Israel/Hamas paradigm has certainly duped a particular subsection of Americans and even a few patriots, even though it is historical fact that the creation of Hamas itself was funded and supported by the Israeli government. Why do Israeli politicians put money and arms at the disposal of Muslim extremist groups like Hamas and ISIS, only to enter into brutal conflict with them later? Could it be that the Israeli government does not have the best interests of the Israeli people at heart? Could it be that Israel is being used by internationalists as a catalyst for chaos? It is vital that we question the intentions behind such contrary actions in the Middle East.
Why has the U.S. government (Democrats and Republicans), Saudi Arabia, and Israel put support behind the ISIS caliphate in Iraq after spending decades of time, billions in resources, and thousands of lives, attempting to overrun and dominate the region? Why are these governments creating enemies that will later try to harm us?
It is all about false paradigms; dividing the masses into numerous conflicting sides and pitting them against each other when they should be fighting against the elites.
The false East/West paradigm is perhaps the most dangerous lie facing free men today. It is a lie that may very well define our generation if not our century. I have outlined in multiple articles the substantial evidence that proves beyond a doubt that Russia and China are members of the globalist agenda, and that the tensions between our two hemispheres are completely fabricated.
The latest announcement of a BRICS bank to rival the IMF is yet another scheme to perpetuate the illusion that the elites of these nations are at odds. In fact, the BRICS conference mission statement makes it clear that developing nations have no intention of breaking from the IMF (and certainly not the BIS). Instead, the BRICS bank is meant to provide “leverage” to “force” the IMF to become more inclusive, and hand over more power and participation. Vladimir Putin had this to say at the latest summit:
In the BRICS case we see a whole set of coinciding strategic interests. First of all, this is the common intention to reform the international monetary and financial system. In the present form it is unjust to the BRICS countries and to new economies in general. We should take a more active part in the IMF and the World Bank’s decision-making system. The international monetary system itself depends a lot on the US dollar, or, to be precise, on the monetary and financial policy of the US authorities. The BRICS countries want to change this.
Brazilian President Dilma Rousseff insisted that the BRICS were not seeking to distance themselves from the Washington-based International Monetary Fund:
On the contrary, we wish to democratize it and make it as representative as possible…
Putin and the BRICS commonly rail against the “unipolar” financial system revolving around the U.S. dollar, but in the end they are only controlled opposition, and their solution is to place even more power into the hands of the IMF (a supposedly U.S. government controlled institution), creating a truly unipolar world order. If the U.S. loses its IMF veto status this year due to lack of allocated funds, and the BRICS dump the dollar as world reserve, this may very well happen.
As sanctions between Russia and the U.S. snowball, a perfect rationalization for a dollar decoupling will be created that very few people would have believed possible only a few years ago. It is only a matter of time before fiscal warfare escalates to destructive levels. Russia will inevitably cut off gas exports to the EU, and the BRICS will inevitably drop the U.S. dollar as a world reserve standard.
The U.S. relationship to the EU is also currently being presented as dubious, and this is not by accident. Failing relations between America and Germany are yet more theater for the masses to chew on. Western allies have been spying on each other for decades, but somehow the exposure of CIA activities in Germany is shocking news? The NY Fed suddenly attacks Deutsche Bank, seeking expanded monitoring and regulation? Germany’s business interests are highly damaged by U.S. sanctions against Russia? It would seem as though someone is trying to create an artificial divide between elements of the EU and the U.S.
I believe that the narrative is being prepared for a faked financial breakup between the U.S. and many of its former allies, isolating the U.S., and destroying the dollar, but to what end? To answer that question, we must ask WHO ultimately benefits from these actions?
The Rise Of The Hero Bankers
In June of last year, the Bank for International Settlements, the central bank of central banks whose history began with the financial support of the Third Reich, released a statement warning that “easy money” from central banks was creating a dangerous bubble in stock markets around the world.
The IMF, too, has been pushing warnings of stock bubble collapse into the mainstream.
In June of this year, the BIS, a normally obscure and secretive organization, released another statement pronouncing that government had been led into a “false sense of security” by easy monetary policy and low interest rates, making the world economy perpetually unstable.
For an organization so covert and occult, the BIS sure has become rather candid lately. Frankly, I agree with everything they have said. However, I do not agree with the hypocrisy of the BIS, which dominates the decisions of all of its member banks, publicly criticizing policies which it most likely scripted itself. Why would the BIS suddenly denounce fiscal methods it used to promote? Because the BIS is setting itself up as the great prognosticator of a collapse that IT HELPED ENGINEER.
After the great financial war has subsided, and the people are suitably poverty stricken and desperate, it will be institutions like the BIS and IMF that swoop in to “save the day”. Their offer will be to consolidate economic control into the hands of an elite group of bankers “not affiliated” with any particular nation state, thereby insulating them from “political concerns”. The argument will be that national sovereignty is a bane on the back of humanity. They will claim that the catastrophe will continue until we “simplify” and streamline our economic and political systems. They will present themselves as the heroes of the age; the ones who predicted the crisis would occur, and the ones who had a solution ready to save the day (after sufficient death and destruction, of course).
As long as people remain obsessed with false paradigms and faux enemies, the establishment’s goal of complete centralized dominance will be predictably attainable.
If we change our focus to the internationalists as the true danger instead of playing their game by their rules, then things will become far more interesting…
You can contact Brandon Smith at: email@example.com. Alt-Market, where this article first appeared, is an organization designed to help you find like-minded activists and preppers in your local area so that you can network and construct communities for mutual aid and defense. Join Alt-Market.com today and learn what it means to step away from the system and build something better.
If we change our focus to the internationalists as the true danger instead of playing their game by their rules, then things will become far more interesting… !!!!!! Well now, isn’t it strange that this old high school drop out has been saying the same thing for years.
ELIMINATE THE ELITE BANKERS BEFORE IT’S TOO LATE.
July 15th, 2014 by olddog
By Tony Cartalucci
When the special interests who created and direct the agenda of the European Union disagree with member states, the true nature of this supranational enterprise becomes painfully apparent – one of dictatorial special interests pursing regional policy that benefits none of its individual member states. No example of this can be clearer than the dispute that has emerged over the construction of Russia’s South Stream natural gas pipeline set to run through Bulgaria, Serbia, Hungary, and Italy.
The pipeline produces a large number of benefits for each of the nations it passes through, as well as for energy markets on either end of the pipeline. For the people and governments of these nations set to benefit most from the pipeline, the deal is an attractive, long-term investment. For the special interests that have created and currently direct the EU – on the other hand – it poses as a direct threat to their designs of continued expansion and corporate-financier hegemony beyond the collective borders of today’s EU.
For the hegemon, coexistence and collaboration are not options – thus the benefits of the South Stream pipeline escape them. Instead, these hegemonic special interests seek to control their own pipeline and energy markets on either side of it, and this can be seen developing along several fronts including the Southern Corridor Project, beginning in Azerbaijan along the Caspian Sea.
Energy and foreign policy expert Sinan Ulgen of the US government and corporate-financier funded Carnegie Europe think-tank complained about the disparity between the EU Commission’s stance, and that of individual EU member states in an Anadolu Agency (AA) article titled, “Russian South Stream gas pipeline divides EU,” stating:
“…the EU’s main concern about South Stream is that the project would increase its dependence on Russian gas. Last year a third of its consumed gas was supplied by Russia.
Additionally the AA article would state:
While the European Commission opposes Russia’s South Stream gas pipeline project, certain EU countries like Austria and Italy continue to openly support the world’s most expensive pipeline project, which aims to transport Russian gas by bypassing Ukraine.
For the last two years, Russia has signed bilateral agreements with Italy, Bulgaria, Serbia, Hungary, Greece, Slovenia, Austria and Croatia for the construction of the South Stream gas pipeline, which is estimated to cost nearly US$40 billion according to the Moscow Times. Gazprom recently announced however that it was abandoning construction of the Italian portion of the pipeline.
These agreements were deemed a breach of EU anti-trust law by the European Commission in December. And, in April, following the annexation of the Crimean peninsula by Russia, the European Parliament voted for the South Stream project to be stopped.
AA would also cite another corporate-financier funded think tank, Chatham House – also complaining about EU members pursuing their own interests in contradiction to the EU Commission’s dictates. The unelected EU Commission appears to be pursing its own extraterritorial geopolitical pursuits ahead of those of the individual member states and their respective populations. That corporate-financier funded “think tanks” are focused on this “divide” and championing the EU Commission’s agenda over that of the individual EU members it allegedly represents fully exposes the EU for what it truly is, a dysfunctional supranational dictatorship.
And what is done in the name of the EU by its institutions like the EU Commission, which admittedly does not represent the best interests or desires of those it claims to represent, unfortunately and perhaps unfairly reflects on the EU as a whole. For example, and as part of the energy debate, the current EU support of the regime occupying Kiev, Ukraine, taints all of Europe, even as many EU member states attempt to move cautiously or even in opposition to the greater agenda the EU Commission and others are pursuing.
While the EU promotes itself as a bastion of freedom, stability, and prosperity, it appears increasingly more like a hegemonic bloc, dictating to, rather than acting as a representative of, the European people. The slogan “Toward a Europe Whole and Free” rings hollow when the EU Commission begins dictating policy to individual states, and curtailing progress that benefits both individual nations and their people.
The EU, in this light, appears more of an autocratic oligarchical consolidation of regional power and resources, not a democratic collaboration between nations. A slogan like “Toward a Europe Whole and Free” appears then to represent Europe, but only from the perspective of special interests seeking to loot the region collectively, rather than nation-by-nation. The dysfunction and dictatorial nature of the EU Commission and other apparatuses within the supranational bloc serve as a cautionary example for other nations seeking to construct their own alliances – from Asia’s ASEAN-AEC (Asian Economic Community), to regional alliances between Russia, China and with nations along their peripheries.
Alliances that include obligations that usurp national sovereignty are not alliances at all, they are hegemonic infiltration by special interests who would rather see a village place their valuables in a single safe for them to crack and loot, rather than take the time and trouble to rob each individual home. Europe must decide whether it will continue along a path of internal conflict with its alleged EU representatives tainting their collective populations, cultures, and histories, or reform the EU into an institution that allows collaboration and national sovereignty to exist in tandem.
Tony Cartalucci, Bangkok-based geopolitical researcher and writer, especially for the online magazine “New Eastern Outlook”.
Copyright © 2014 Global Research
July 12th, 2014 by olddog
Thomas Jefferson, the author of America’s July 4, 1776 Declaration of Secession from the British empire, was a lifelong advocate of both the voluntary union of the free, independent, and sovereign states, and of the right of secession. “If there be any among us who would wish to dissolve this Union or to change its republican form,” he said in his first inaugural address in 1801, “let them stand undisturbed as monuments of the safety with which error of opinion may be tolerated where reason is left to combat it.”
In a January 29, 1804 letter to Dr. Joseph Priestley, who had asked Jefferson his opinion of the New England secession movement that was gaining momentum, he wrote: “Whether we remain in one confederacy, or form into Atlantic and Mississippi confederacies, I believe not very important to the happiness of either part. Those of the western confederacy will be as much our children & descendants as those of the eastern . . . and did I now foresee a separation at some future day, yet should feel the duty & the desire to promote the western interests as zealously as the eastern, doing all the good for both portions of our future family…” Jefferson offered the same opinion to John C. Breckinridge on August 12, 1803 when New Englanders were threatening secession after the Louisiana purchase. If there were a “separation,” he wrote, “God bless them both & keep them in the union if it be for their good, but separate them, if it be better.”
Everyone understood that the union of the states was voluntary and that, as Virginia, Rhode Island, and New York stated in their constitutional ratification documents, each state had a right to withdraw from the union at some future date if that union became harmful to its interests. So when New Englanders began plotting secession barely twenty years after the end of the American Revolution, their leader, Massachusetts Senator Timothy Pickering (who was also George Washington’s secretary of war and secretary of state) stated that “the principles of our Revolution point to the remedy – a separation. That this can be accomplished without spilling one drop of blood, I have little doubt” (In Henry Adams, editor, Documents Relating to New-England Federalism, 1800-1815, p. 338). The New England plot to secede from the union culminated in the Hartford Secession Convention of 1814, where they ultimately decided to remain in the union and to try to dominate it politically instead. (They of course succeeded beyond their wildest dreams, beginning in April of 1865 up to the present day.)
John Quincy Adams, the quintessential New England Yankee, echoed these Jeffersonian sentiments in an 1839 speech in which he said that if different states or groups of states came into irrepressible conflict, then that “will be the time for reverting to the precedents which occurred at the formation and adoption of the Constitution, to form again a more perfect union by dissolving that which could no longer bind, and to leave the separated parts to be reunited by the law of political gravitation…” (John Quincy Adams,>The Jubilee of the Constitution, 1939, pp. 66-69).
There is a long history of American newspapers endorsing the Jeffersonian secessionist tradition. The following are just a few examples.
The Bangor, Maine Daily Union once editorialized that the union of Maine with the other states “rests and depends for its continuance on the free consent and will of the sovereign people of each. When that consent and will is withdrawn on either part, their Union is gone, and no power exterior to the withdrawing [state] can ever restore it.” Moreover, a state can never be a true equal member of the American union if forced into it by military aggression, the Maine editors wrote.
“A war … is a thousand times worse evil than the loss of a State, or a dozen States” the Indianapolis Daily Journal once wrote. “The very freedom claimed by every individual citizen, precludes the idea of compulsory association, as individuals, as communities, or as States,” wrote the Kenosha, Wisconsin Democrat. “The very germ of liberty is the right of forming our own governments, enacting our own laws, and choosing or own political associates … The right of secession inheres to the people of every sovereign state.”
Using violence to force any state to remain in the union, once said the New York Journal of Commerce, would “change our government from a voluntary one, in which the people are sovereigns, to a despotism” where one part of the people are “slaves.” The Washington (D.C.) Constitution concurred, calling a coerced union held together at gunpoint (like the Soviet Union, for instance) “the extreme of wickedness and the acme of folly.”
“The great principle embodied by Jefferson in the Declaration of American Independence, that governments derive their just powers from the consent of the governed,” the New York Daily Tribune once wrote, “is sound and just,” so that if any state wanted to secede peacefully from the union, it has “a clear moral right to do so.”
A union maintained by military force, Soviet style, would be “mad and Quixotic” as well as “tyrannical and unjust” and “worse than a mockery,” editorialized the Trenton (N.J.) True American. Echoing Jefferson’s letter to John C. Breckinridge, the Cincinnati Daily Commercial once editorialized that “there is room for several flourishing nations on this continent; and the sun will shine brightly and the rivers run as clear” if one or more states were to peacefully secede.
All of these Northern state editorials were published in the first three months of 1861 and are published in Howard Cecil Perkins, editor, Northern Editorials on Secession (Gloucester, Mass.: 1964). They illustrate how the truths penned by Thomas Jefferson in the Declaration of Independence — that the states were considered to be free, independent, and sovereign in the same sense that England and France were; that the union was voluntary; that using invasion, bloodshed, and mass murder to force a state into the union would be an abomination and a universal moral outrage; and that a free society is required to revere freedom of association — were still alive and well until April of 1865 when the Lincoln regime invented and adopted the novel new theory that: 1) the states were never sovereign; 2) the union was not voluntary; and 3) the federal government had the “right” to prove that propositions 1 and 2 are right by means murdering hundreds of thousands of fellow citizens by waging total war on the entire civilian population of the Southern states, bombing and burning its cities and towns into a smoldering ruin, and calling it all “the glory of the coming of the Lord.”
[LewRockwell.com, July 4, 2014]
For those who have read this essay, does your heart not expand with the lust for freedom? Does the adrenalin of freedom not make you light headed? Can any one deny that this is what we need to enforce on the corporate scumbags that rule our country? Yes I agree there would be many problems to solve if America was not a slave state to the Banksters, but how little confidence would one have to not pursue it? Who care’s if the Vatican has title from the Dead King of England. We did not have a problem when we thought we were taking it by force. SO WHAT’S WRONG WITH DOING IT RIGHT THIS TIME? For those who have not been educated yet, here is the real history of America.
The King of England had seeded America, along with All the Kings holdings and power to the Pope to recover his soul for the sin of Divorce. The Banksters were hired by the Pope to control the Governments, and now we are sucking hind tit as slaves to the corporations that have managed to control the Government. America is run as a profit producing business as witnessed by all the laws they use to fine us. It’s all one huge extortion racket that has expanded globally. Pretty soon we will have to get a permit to take a crap. Hint, Never go through an air-port without some change in your pocket, just in case Nature Calls.
May 13th, 2014 by olddog
by Ryan McMaken on May 13, 2014
The Supreme Court’s recent decision on prayer at government meetings reminds me that Supreme Court “season” is upon us, and for the next two months or so, we can expect to see the court decide on a variety of cases that can have profound impacts on the lives of citizens and non-citizens alike. The court’s decision in Town of Greece vs. Galloway has produced a lot of commentary on both sides, with much discussion about the dynamics between justices, and how Justice Kennedy must have been in a pro-prayer mood that day, since his decisions appear to be made on a variety of unknowable whims.
Nearly all of this commentary contains the assumption that it is perfectly normal, and probably laudable, that the Supreme Court has the power to decide the legality of virtually everything under the sun, from the death penalty to where local governments can build strip malls.
If there was ever any doubt that public schooling has been an immense success when it comes to conditioning children to blindly accept even the most implausible myths of governance, we only need look to the high regard in which most Americans hold the Supreme Court. The fact that nine modern philosopher kings are empowered to sit in judgment of every American law and custom, right down to whether or not a city council meeting, in a town virtually no American could find on a map, can include some bland prayer time. It troubles no school child that he is taught that democracy is the source of legitimacy for all governments one minute, and then the next minute is told he should fully trust nine lawyers in robes in Washington, D.C. to have the final word on law for 300 million Americans.
The proposition that nine people should tell 300 million people what sorts of laws they should make is rather ludicrous on its surface, but the justification largely rests on the assertion that the judges are somehow above politics and make decisions based on nearly pure reason. Political scientists and most people with experience in the legal profession no doubt know this is nonsense, but the average American is far more likely to be accepting of the long-standing myth that the court is a sort of backstop that prevents “bad” American laws from being allowed to stand. “Sure,” they might say, “Congress and the president, which are infected by vulgar politics, can do many horrible things, but the Supreme Court will dispassionately evaluate them and decide laws strictly on their legal merits.”
This view of the court is of course hopelessly fanciful, and the truly political nature of the court is well documented. Its politics can take many forms. For an example of its role in political patronage, we need look no further than Earl Warren, a one-time candidate for president and governor of California, who was appointed to the court by Dwight Eisenhower. It is widely accepted that Warren’s appointment was payback for Warren’s non-opposition to Eisenhower’s nomination at the 1952 Republican convention. The proposition that Warren somehow transformed from politician to Deep Thinker after his appointment is unconvincing at best. Or we might point to the famous “switch in time that saved nine” in which Justice Owen Roberts completely reversed his legal position on the New Deal in response to political threats from the Franklin Roosevelt administration. Indeed, Supreme Court justices are politicians, who behave in the manner Public Choice theory tells us they should. They seek to preserve and expand their own power.
The court, jealous of its power, and reluctant to hand down decisions that might actually cause the court to lose prestige, is at times careful to reflect the majority opinion regardless of how atrocious it might be. To see this, we need look no further than Korematsu vs. The United States in which the court declared it perfectly legal to round up American citizens and throw them into concentration camps.
The court forever plays a careful balancing act with both the public and with other branches of the federal government in which if continually pushes the bounds of federal power without rocking the boat to the point of calling its legitimacy into question among the majority of the population. Naturally, Congress and the presidency, themselves committed to untrammeled federal power, have no problem with most of this on most occasions, except perhaps in the details.
Bizarrely, however, the court has even managed to cultivate a reputation as a limit on the power of government, and that justices will rein in the state because it is committed, however imperfectly, to the Constitution of the United States. This is wishful thinking in the extreme, however, since the Constitution is nothing more than what the Supreme Court says it is, and this has been well established since Justice Marshall first introduced judicial review into the court’s decisions. If the Constitution was designed to prevent rule by judges (which may or may not be the case), it has clearly failed in its mission. Moreover, the court acts to insert intellectual legitimacy into laws and policies that formed out of nothing more that interest group lobbying, political payoffs, and even outright corruption. Once these laws receive the imprimatur of the Supreme Court, they cease to be political acts, questionable in origin, and take on the life of perpetually established law and precedent.
The public’s deference to the court and its decisions is the key factor in the court’s immense power, and the myth of the court as the protector of what’s left of the Constitution is especially powerful. But, as Ludwig von Mises noted in Liberalism, as an agent of the Federal government, the idea of the court as a friend to limited government is an absurdity:
The tendency to impose oppressive restraints on private property, to abuse political power, and to refuse to respect or recognize any free sphere outside or beyond the dominion of the state is too deeply ingrained in the mentality of those who control the governmental apparatus of compulsion and coercion for them ever to be able to resist it voluntarily. A liberal government is a contradictio in adjecto. Governments must be forced into adopting liberalism by the power of the unanimous opinion of the people; that they could voluntarily become liberal is not to be expected.
Naturally, the court does not limit itself at all, but it knows it is nonetheless limited by public opinion at least as well as anyone else. The court’s strenuous efforts to maintain an aura of majesty and intellectual loftiness can be seen in its refusal to allow television cameras in its hallowed halls or any sort of direct observation by the public at large. The judges wear academic robes and sit on their high bench. They could just as easily do their jobs in business suits while sitting at the same height as everyone else. Of course, if that were the case, the justices would just look like the glorified county commissioners they are, and the court’s propaganda war against the public is essential in maintaining its near total immunity from any meaningful oversight from anyone at all.
Here we go again! Out of one of America’s most esteemed political commentary organizations comes the same old emission of the facts. By the above article any uninformed reader would conclude that this country really is a democracy, but run by self serving people. Absolutely nothing close to the truth was addressed. THE TRUTH concerning this situation in the Supreme Court is, they do not represent the people, they represent the United States Corporation and the oligarchy that owns it. AND THAT is why the organic Constitution is of no concern to them. AND THAT is why we now live in a slave state with brutal law enforcers assaulting the people for NON VICTIMS CRIMES. AND THAT is why we have been beguiled by a despicable education and meda industry to accept their theft of our freedom.
May 8th, 2014 by olddog
Despite popular belief, very few things in our world are exactly what they seem. That which is painted as righteous is often evil. That which is painted as kind is often malicious. That which is painted as simple is often complex. That which is painted as complex often ends up being disturbingly two dimensional. Regardless, if a person is willing to look only at the immediate surface of a thing, he will never understand the content of the thing.
This fact is nowhere more evident than in the growing “tensions” between the elites of the West and the elites of the East over the crisis in Ukraine.
I am continually astonished at the refusal of many otherwise intelligent people to consider the evidence or even the possibility that there is, in reality, no fundamental political or philosophical conflict between the power brokers of the East and the West. As I outlined in great detail in Russia Is Dominated By Global Banks, Too, the truth is they are both working toward the same goal; and both ultimately benefit from an engineered and theatrical display of international brinksmanship.
Russia, like the United States, is utterly beholden to globalist financiers through organizations like the International Monetary Fund and the Bank for International Settlements. Russia’s global economic adviser in matters ranging from investment image to privatization is none other thanGoldman Sachs.
Goldman Sachs has also worked closely with the Ukrainian government since 2011, and it started its advisory work with Ukraine for free. (Whenever Goldman Sachs does something for free, one should take special note.) Banking elites have been working both sides of the fence during the Russia versus Ukraine charade.
Russia has continued to borrow billions of dollars from Western banks, including Deutsche Bank and Credit Suisse, year after year, proving that they are not averse in the slightest to working closely with "evil Western robber barons".
Russian President Vladimir Putin meets with Mr. New-World-Order himself, Henry Kissinger, on a regular basis; and according to Putin’s press secretary, they are “old friends.” Putin’s meetings with Kissinger began almost immediately after he first took power in 2000.
Putin’s relationship with Kissinger has been so pronounced that the Russian Foreign Ministry gave Kissinger an honorary doctorate in diplomacy, and Putin placed Kissinger at the head of a bilateral “working group” — along with former KGB head and multilateralist (globalist) Gen. Yevgeny Primakov — dealing with foreign policy.
In more recent news, I would also remind pro-Putin cheerleaders that Putin and the Kremlin first pushed for the IMF to take control of the Ukrainian economy, and the IMF is now demanding that Ukraine fight Russia in exchange for financial support. This might seem like irony to more foolhardy observers; but to those who are aware of the false East/West paradigm, it is all the part of a greater plan for consolidation of power.
Clearly, Putin and Russia are just two more puppet pieces on the globalist chessboard, pitted against other puppets in the West in a grand theater designed to distract and divide the masses through chaos. As Kissinger points out, in crisis there is opportunity.
What is the goal? They’ve already told us, openly, on numerous occasions.
The first great prizes of the New World Order are a global currency and centralized economic control. The elites are not satisfied with quiet dominance of individual economies. They want complete political homogenization and the end of all sovereignty. Period. With a global currency in place, the steps towards global government become quick and small.
Heads of state from around the world, including Putin, as well as international bankers and IMF representatives have all publicly called for the IMF to take charge of the global economic system through its Special Drawing Rights currency program.
However, for the SDR to become a dominant currency, certain issues must be resolved. Here’s a short list.
The U.S. Dollar Must Fall
The dollar must lose its world reserve status, and most likely collapse in relative value, before the SDR can be elevated. This is where mainstream pundits lose track of the facts. For them, the dollar is an invincible monetary element, a currency product as infinite as time. Their normalcy bias prevents them from ever acknowledging the many weaknesses of the Federal Reserve note, including our country’s inability to ever service its more than $200 trillion debt. Others believe the dollar is the NWO currency, and that the globalists are somehow U.S.-centric. The evidence posted above suggests otherwise. Globalists have no loyalty to any nation or culture. Their only loyalty is to the progression of their own power. If sacrificing the dollar or the U.S. as a whole furthers that power, then they will have no problem cutting us loose like a rotting appendage.
A Liquidity Replacement Must Be Introduced
As my regular readers know, I have been covering China’s progression toward a decoupling from the U.S. economy for years. China, in my view, has always been the key to the elitist shift into a truly global currency mechanism. The primary argument in the mainstream against the idea of a dollar collapse is that there is no other currency with ample liquidity to take the dollar’s place. Well, in the past couple of years, this has changed.
China and the banks it controls have issued approximately $25 trillion in debt instruments and monetization. This is often referred to as a “debt bubble” created through panic and a weakness in China’s economy and a response to slowed quantitative easing in the United States. I would take a slightly different position. China began issuing Yuan denominated debt instruments in 2005, years before the mainstream had any inkling of the impending derivatives collapse. From then up to today, there has been no practical purpose for China to produce these Yuan denominated equities and securities, unless their target has always been to expand the Yuan market in a covert way.
I would say that China’s monetization has been carefully and deliberately engineered in order to lay the foundation for a massive liquidity spike in the Yuan. The argument that China’s incredible debt generation is a sign of impending collapse may be misguided. U.S. debt, including unfunded liabilities, absolutely dwarfs China’s $25 trillion. China's Yuan debt has barely had time to accrue concrete interest. The U.S., on the other hand, is caught in an endless cycle of interest payments that are slowly but surely eating away the skeleton of our fiscal structure. If any economy is on the verge of implosion, it is that of the United States, not of China.
The Chinese need exponential Yuan circulation. They do not want the Yuan to replace the dollar; instead, they are preparing it for induction into the IMF’s Special Drawing Rights basket. WithChina set to become the world largest economy this year according to World Bank, their inclusion is assured.
But, when might this occur?
The IMF holds an international conference and policy meeting on the SDR every five years. During these meetings, the IMF decides if it will absorb a new currency into the basket and if it will expand the creation or circulation of SDRs around the world. Interestingly, the next IMF conference on the SDR just happens to be scheduled for the end of 2014 to the beginning of 2015.
Another strange coincidence: The U.S. Congress was supposed to vote on legislation for further capital allocations to the IMF by April. The vote never came. The new allocations were to fund an expansion of IMF programs and help with the greater inclusion of BRIC nations in governing decisions. If the U.S. government does not pass this legislation, Russia and other nations have demanded that the IMF move forward without the United States on reforms. At the very least, the U.S. would lose its veto power over IMF decisions. I believe that the timing of this is deliberate, that the U.S. is meant to lose its veto power and that the simultaneous SDR conference will announce the inclusion of the Chinese Yuan, setting the stage for the replacement of the dollar as world reserve.
The SDR will not immediately be issued as a commonly traded currency itself. Rather, the IMF will take over management of included currencies and denominate those currencies using SDR valuations. For example, $1 U.S. is worth only .64 SDR today. In the near future, I expect that the dollar will plummet in relation to the SDR’s value. We will still have our greenbacks when the IMF begins administrating our currency system, but the international and domestic worth of those greenbacks will fall to pennies. In turn, other currencies with stronger economic positions will rise in worth relative to the SDR.
I believe one of the primary determinations in a currency’s value compared to the SDR will be a country’s stockpile of gold. This is why Russia and China in particular have been purchasing precious metals at an unheard-of rate (and why U.S. gold reserves have never been audited). The IMF itself is one of the world’s largest holders of physical gold, with nearly 3,000 metric tons (officially). With the crash of the dollar system and investors clamoring for a reliable hedge to protect whatever savings they have left, gold could conceivably skyrocket into the $5,000 to $10,000 per-ounce range. Governments holding the metal will be favorably placed during an implementation of the SDR as the new reserve standard.
A Cover Event Must Be Created
The centralization of power is best achieved during moments of bewildering calamity. The conjuring of crises is one of the oldest methods of elitist dominance. Not only can they confuse and frighten the masses into malleability, but they can also ride to the public’s rescue as heroes and saviors later on. The Hegelian dialectic is the mainstay of tyrants.
The destruction of the dollar and the institution of a global economic bureaucracy are not actions that can be executed openly by international financiers. These events will coincide with extreme catastrophe, likely worse than the Great Depression era, with millions upon millions of people losing the ability to financially support themselves and their families. Crime, death and public discontent will surely follow. People will be looking for someone to blame. This is where the false East/West paradigm comes in.
It is widely expected that as sanctions snowball between Russia and the U.S. that the dollar will end up on the chopping block. China has asserted its support for Russia in opposition to NATO interference in Ukraine. The stage has been set. I have warned for quite some time that the development of East/West tensions would be used as a cover for a collapse of the dollar system. I have warned that among the American media this collapse would be blamed on an Eastern dump of foreign exchange reserves and treasuries, resulting in a global domino-effect ending U.S. world reserve status. In turn, the international community would be conditioned to see this as the mere bumbling of a spoiled America gone power-mad, rather than the result of a covert program of economic destabilization. This might lead to all-out war or a fiscal firestorm that leaves much of the world crippled and desperate for aid.
In either case, the elitist plan is to use scapegoats and false enemies to draw our attention away from the real culprits: the international banks themselves. Make no mistake: This fight is not about President Barack Obama, it is not about Putin and it is not even about the Federal Reserve. These men are tools, errand boys, public mascots. Do not be fooled by the global stage play being perpetrated. Whatever happens in Ukraine and whatever happens between Russia, China and the West, there are only two real sides to this battle: the elitist establishment, and those who are smart enough to recognize their poison.
You can contact Brandon Smith at: firstname.lastname@example.org. Alt-Market is an organization designed to help you find like-minded activists and preppers in your local area so that you can network and construct communities for mutual aid and defense. Join Alt-Market.com today and learn what it means to step away from the system and build something better.
February 25th, 2014 by olddog
Stockman – $500 Trillion Derivative Bomb Threatens The World!
Today David Stockman warned King World News that a terrifying $500 trillion derivative bomb threatens the entire world. He also went on to caution about a second danger facing the world. KWN takes Stockman’s warnings very seriously because he is the man former President Reagan called on in 1981, during that crisis, to become Director of the Office of Management and Budget and help save the United States from collapse. Below is what Stockman had to say in part II of a series of powerful interviews that will be released today.
Stockman: “I think the great ticking time bomb is interest rate swaps. The last time I checked they were in the range of $500 trillion. Who knows what’s lurking underneath the surface there?….
Stockman: “The single greatest danger is that the game the central banks are playing today will come to an abrupt and destructive end. That’s the danger because the whole system is now running off the short-run maneuvers, liquidity, and guidance that the central banks are injecting into the market every day. The danger is that one of these days the whole system will fail because it is unnatural and artificial, and when that happens it’s going to be a pretty difficult (and chaotic) time.” read more!
Just think a moment, the International Investment Bankers have been sucking our country dry for more years than anyone on earth has lived. Does that make sense folks? when will the people understand they simply cannot have a life of total leisure, we must spend time learning what is going on in our government and discuss what to do about it. By now, the entire world could have financial security if it were not for these blood suckers. Please for the sake of your children and Grand children get off your ass and learn. If I can find and learn what is wrong with the world, there is no excuse for anyone to remain ignorant. There is a way to fix the world. KILL THE BANKERS, and confiscate their wealth! Does that offend you? You don’t seem to get upset when the bankers have millions killed in their wars, while you work in their war factories though, do you? Wake the hell up America!
February 13th, 2014 by olddog
This article was written by Koos Jansen and originally published at In Gold We Trust
These financial industry giants lived through all the wealth cycles of the past 100 years and more. What used to be long term wealth investments evolved to the day-trading, making money activities, with a top in the year 2000. Then the financial industry morphed rapidly into the absurd High Frequency Trading. All wealth is now a spooky derivative of what it once was. Debt rules!
The US was the biggest gold reserve holder in the entire world, with 28,000 metric tons of gold in its vaults (60% of the world's total gold reserves). Most, if not all, of that gold disappeared from the UST, whilst the financial industry and the debt driven economy, expanded. First there was the London Gold Pool selling central bank gold reserves, then in 1974 Louise Auchincloss Boyer discovered that N. Rockefeller was selling UST Fort Knox gold. Three days later she fell out of her window (July 3, 1974).
Immediately afterwards a Fort Knox propaganda tour was organized. All gold fever stopped in 1980. Stock markets started their rise to the moon. Fifteen years later, the European System of Central Banks started their gold sales. Stock markets reached for the stars and suddenly The Queen made a propaganda tour through the London gold vaults (Dec, 2012). Now, China, Russia and other pro gold states (BRICS Development Bank) are accumulating the scare residues of available physical gold. The debt driven Western economy is in stagnation and the global debt crisis remains unsolved.
Where has all the physical bullion gold gone? Where is it concentrated after 45 years of distribution and very low paper gold prices? Hard to say, but the main flow of physical gold went certainly from West to East. Simply because the Western financial (pseudo) wealth industry was rising since 1980 and that made physical gold obsolete, in particular for the average Western man on the street.
The MSCI emerging market index is declining and never reached the Dow/Nasdaq/S&P heights. Physical gold has flown to these Eastern emerging (mostly surplus producing) markets whilst Western deficits are still rising. An upside down world,…or not. European banks have a $ 3.4 trillion exposure to the weak emerging markets who are suffering from brutal $ withdrawals. China's shadow banking is enormous and dangerous. The entire world has multiple fundamental reasons to embrace physical gold as a wealth asset, but only an extremely small minority keeps accumulating physical gold. The bulk of physical gold is now in the very strong hands of Western and Eastern giant dynasties and a relative very small group of gold wealth connected individuals. They all continue to accumulate, whatever the paper price of gold may discourage. They all anticipate the same looming catastrophe: pseudo-wealth destruction!
The Far & Middle East stores its wealth in physical gold and the West keeps going for financial industry pseudo-wealth and paper gold for making more (debt)money. This gold imbalance will increase strongly the more the gold price declines! Declining gold prices must encourage the further accumulation of risk assets. The Western giants don't care that Joe sixpack has no gold. They must feed their financial industry pseudo-wealth (buy stocks and debt paper). The Western giants, with trainloads of physical gold, don't care that the scarce left-overs of available physical gold flows cheaply to the East. When the pseudo-wealth comes to an end and the East will say physical gold is the real store of wealth, the Western giants with gold in their vaults, remain wealthy. Then the whole (political) economic story restarts from scratch.
The giant dynasties *are* the financial industry. They produce and control the bulk of the debt-driven pseudo-wealth. The FED is even providing liquidity for Mario's ECB (swaps). That's why their balance sheet is diverging. Euro-land is in fact still $-land.
China's present gold policies are building a base to take over the paper gold pricing from the dollar's financial regime. The valuation of physical gold must be totally delinked from currency and risk assets. China wants an orderly and open Rimini gold market with satisfactory gold market laws as to protect all wealth assets. A gold market where all underground speculative activities are strictly forbidden. They invite all foreigners to gradually participate in this gold market with emphasis on the free floating valuation of physical gold. This is in 100% contrast with the de facto dollar's gold pricing and gold policies. The dollar system doesn't want your wealth assets to be protected with gold. One day, the masses will embrace China's gold policies and leave the international $-reserve for what it never was (hard currency). The Western giants, indeed anticipated this all along with stealth accumulation of physical gold in their private vaults. They know the day of reckoning comes near.
The time has come to s&%t or get off the pot. If you have any investments at all in paper instruments or currency, convert them to cash and buy gold and silver NOW! You will never see your savings mature if their in dollars and you expect to live another year. Who do you know personally that has lost their money in hard commodities? Gold has thousands of years of history supporting its value retention and appreciation. Likewise silver, which is a much better investment for the common man with less than a $million to invest. If you are living pay-check to pay-check sell everything you can do without and buy ammo, guns, shovels, heritage seeds, and various other necessities for when the SHTF. Your dollars will wither away just like your youth, only much faster now. It’s time to get off your backside and learn how to live in a post dollar America. Barter will be the common mans money system before you are five years older.
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!