The Long Cold Winter

[can't sit still]

This page has some interesting graphs. They predict when various countries will reach a point that debt-service takes 10 % of the budget.
http://news.goldseek.com/MillenniumWave ... 812700.php
The charts are prepared by the BIS. The charts show that the US will need 100 % of GDP to service the debt VERY soon. If they cancel the so-called entitlements, that will stall the crash off by a bit. The Congressional budget Office agrees with the projections of the BIS.

Strange,,,,, I don't see any projections of our solvency predicated on canceling military expenditures.

If I owe money to the bank, they consider my note as an asset. They figuratively fill up their vault with these notes [bonds] They leverage these assets. Since Federal Reserve Notes are debt money, the banks are quite accustomed to shuffling debt notes all around the place.
So, the banks hold endless trillions of debt notes. The productive sector of the economy has to produce goods and services to vitiate these notes,,,, even though they get only a tiny share of the wealth. The productive sector is neither producing nor consuming. The banks are not getting enough to keep the credit bubble inflated. So, the banks / GOV is going to flog the money out of us.
Their flogging has a 3X negative multiplier on GDP. So, in the process of vitiating the parasite, the corporatocracy will severely diminish the GDP and employment.

All this shuffling around of debt-paper is backed with an ever-decreasing amount of wealth. Lots of BS and paper flying around. NO wealth.
Celente says that it's going to end badly http://www.lewrockwell.com/celente/celente32.1.html
Remember; all you need is your towel and a Pan Galactic Gargle Blaster. And maybe, some bacon.

[1durphul]

Looks like the panic has begun.

[Ugly Dougly]

We got a bonus. Head for the hills.

[Rabbi Dali Rick]

I'm way ahead of ya...




the rebbi

[Ugly Dougly]

It's a correction.
You didn't think 11,000 was overvalued?

[1durphul]

It's a correction.
You didn't think 11,000 was overvalued?

Worse than a correction, it was a glitch, which started a panic, the panic stopped, but the selling hasn't.

[can't sit still]

Well, it's time for an update. I started this thread when an economic crisis was a side issue. It's become a central issue.
The financial operating system that we use is unworkable. It's taken a few hundred years to get that way but,,, here we are.
The undying corporation is the chief antagonist.
The GOD of banking is surrounded by the celestial hierarchy of lesser corporations. The corporation is undying so there is never a "reset" of assets.
Driven by ever-increasing efficiency, the corporations slowly but surely, gained monopoly power. Men of vision, like Ford, Vanderbilt, Carnegie, Rockefeller, Morgan, Hughes and Gates built undying edifices to continue the gradual work of consolidation and monopoly. As monopoly was achieved, profit margins could be raised. "Whatever the market will bear" was the mantra of the new gods.
Until 1971, wages had slowly risen. Since then, productivity and profit have risen but, not wages. John Q Public has had to work harder. Then, John had to put Jame to work also. He still couldn't keep up so, John had to borrow against future wages to keep up.
http://www.financialsense.com/Market/pr ... /0507.html

Meanwhile, the gods obtained more and more control of GOV. Productivity went way up,, GDP went way up. Profits went way up,,, especially when the gods reduced taxes to nothing. So, where did the profits all go? They flowed to the GOD of banking.

Wages went nowhere. The minor god of GOV went broke and had to promise future earnings.
The gods of finance and industry took over the GOV. They then demanded more money glossed over as taxes. The gods were not only undying, they're insatiable too.
The gods had, bit by bit, leached out all the wealth from the economy. The money that would have gone to wages moved to GOD. The money that would have moved to GOV to support society went to GOD.

GOD noticed that we were broke. GOD said, "take on more debt" We were found "not worthy" GOD then instructed GOV to commit all of our future wages to GOD himself.


While GOD was tolerable when he took 10-20-30 %, there is a limit. The undying gods do not recognize a limit. Debt service will soon reach 100 % of our income. The system is broken. The gods continue to insist on new taxes.
The system will go off a cliff with the gods still standing there with a grasping hand held out for the last drop of blood.

[ygmir]

It's a correction.
You didn't think 11,000 was overvalued?

what's wrong with 11,000?

[can't sit still]

With our present system, all countries must depend on the financial industry to buy their bonds. After all, GOV is just a parasite. It has to get blood somewhere.
The financial system seems to have voted "NO" on the Euro bailout. The welfare states of the West are broke. The banks don't want to throw good money after bad.
The bad [worse] news is that it has become obvious that everything that looked like wealth is actually,,, debt.
In the last several years, the GDP has multiplied by about 4 times. The amount of paper currency in circulation has gone up about 300 times,,, depending on the country. The banks have gotten quite rich creating money and scooping it up into their vaults. They do not want to hear you telling them that it is only paper.
They are having a BIG party and are quite pleased with themselves.

They haven't yet noticed that all that debt paper is starting to evaporate. There isn't any possible way to convert / redeem it back into tangibles. The banks are doing what they have always done. The imbalances are different, the quantities are different, the awareness is different. They think that it is all the same... not even close;
http://towneforcongress.com/economy/the ... -dougherty

Our system is "organized" so that the greatest profits are to be found in "cannibalizing" productive industries and countries. What does that promise for the future?

For those of you who have a very good understanding on the gold and silver market, here's an article with no parallel;
http://fofoa.blogspot.com/2010/05/open- ... state.html

[Ugly Dougly]

It's a correction.
You didn't think 11,000 was overvalued?

what's wrong with 11,000?

Nuttin'. It'll be up to 13,000 again soon enough. You had your chance to buy low.

[can't sit still]

Well, it's going to take a couple of years but, things are guaranteed to crash VERY badly. Everyone is aware of the efforts to create a world GOV. The Banking PTB want to have worldwide control of all financial movements. GOV likes that idea because, they can tax the shit out of every moving object. Nothing can escape.
So, the PTB crash the currencies. In the minds of the Illuminists, this will result in the people of the world demanding a solid currency. The Illuminists will be very happy to supply this currency. The IMF is already lined up with it's own flavor. The "special drawing rights" will be the basis. This will have an offshoot that will become the worldwide currency on the street.

"it's being arranged at the International Monetary Fund, whose Special Drawing Rights are being prepared to replace the U.S. dollar as the international reserve currency"
http://www.gata.org/node/8641
All of this seems fairly logical. What the dumb shits don't realize is that; with a huge crash of unbacked currency, the public will never get behind another unbacked currency. GOV will push it like crazy but, people will have no faith. The Eurozone has certainly learned their lesson.
The IMF has visions of total control. I just don't see it happening in any kind of peaceful way.
The Western welfare state is collapsing all around. Even though GOV is working like crazy to create a command economy, to preserve the status quo, it won't stop the collapse. The Illuminaughty plan to unify the whole mess with one GOV [them] and one currency. They need a bad collapse to get rid of national interests. They'll get their collapse all right. They have their collective heads up their collective asses if they think that this will result in worldwide integration. I'm betting on complete fragmentation.

[ygmir]

I'd only suggest, though, you may be giving "the masses" to much credit for independent, clear thought.
If offered a "new money" and told it'll be good to pay for cable tv and new cars, I think they'll jump at it.....regardless if it's "backed" or not.....they have no concern with such things.....just their immediate comfort.

IMHO, that is........the cynical side of me........

[can't sit still]

ygmir, I'm sure that you're correct. We see that the IMF and the EMU just did a 750M euro [$ 1 trillion] stimulus for the Eurozone. The bond market was not at all impressed. GOV can probably impress the "little people" but, the big money managers will boycott worthless currencies.
If / when the GB pound crashes, this tells you that the mega-bankers of the City of London refuse to invest in fiat crap. The banking industry runs GOV. They won't accept shitty money that will steal all their profits through currency inflation.
The Federal Reserve board is a consortium of European bankers. The U.S. dollar has maintained it's value FAR better than all other currencies [not sure about the Swiss Franc]
Industry needs monetary stability to stay in business. Banks need monetary stability to make true profits.
If the banks are running the show, I doubt that they'll go for SDRs that have no accountability. The Euro is partially backed by gold and it's crashing. SDRs would be even worse.
It's looking like it's going to be a big shit fight over who gets to produce the reserve currency. Eventually, the winner will be the currency that is backed by the most collateral,,, tangibles like gold or commodities. In the meantime, things will fall apart.

[Trishntek]

Notice the other day the Canadian dollar is worth $1.03 U.S.

[can't sit still]

Canada is loaded with natural resources and produces 144 % of it's own food supply.... Backed by tangibles.

[can't sit still]

This is an interesting page. We all know that many companies were forcibly bought out with "junk bonds'. GOV is run by the banks. The banks have been allowed to create synthetic instruments that aren't money at all,,, in the usual sense. Banks don't need junk bonds now, they just create what they need to destroy a country out of thin air.
Soros made a cool $ billion several years ago. Many "investors" would like to emulate him.

http://home.comcast.net/~lcmgroupe/2010 ... onanza.htm
The Eurozone ponied up about 750 billion Euros to keep things going. Most of it seems to be loans,,, less seems to be printed. Not sure. The speculators can produce all the instruments that they want. GOV didn't seem to mind it when the speculators attacked companies but, they get pretty worried when they attack countries;
"German Chancellor Angela Merkel warned of a battle between governments and speculators" http://www.sirchartsalot.com/article.php?id=133
All this inflationary stuff with the Euro is helping the dollar,,, for now.
The eventual outcome is for bank insolvency to be replaced by government insolvency;
http://www.marketwatch.com/story/the-se ... 2010-05-14

Forgot a link. The European banks are now saying that the U.S. is worse off than Greece.
http://blogs.telegraph.co.uk/finance/ed ... f-england/
BUT, all the rating agencies are in the U.S. so, we keep out AAA rating.
We don't deserve it;
=http://trueslant.com/michaelpollaro/201 ... 9D-us-too/

[can't sit still]

While it's true that the banks and corporations have extracted too much money from the economy for it to operate, there is another big problem.


The Western world has gone headlong into socialism. Putin warned Obumer not to do it. Socialism has never worked. Our current earnings weren't enough to support the predations of the banks AND the drain of the "dole" So, we borrowed and pulled our earnings out of the future.
I couldn't tell you if Western socialism could / would function if the predatory banking industry didn't exist. The Eurozone is more socialist than America. The Eurozone is crashing first. The educated consensus is that the monetary authorities have bought a 3 year postponement of the crash.
http://mises.org/daily/4365
I doubt that this is true of GB. Hard to say because the FED is buying British debt.
Paul Volker said that the Euro is on the brink of extinction; http://finance.yahoo.com/tech-ticker/ar ... Extinction

Like an engine, the economy needs a certain amount of money [oil] to function. When there is no oil [money] in circulation, the engine seizes up. It's painfully obvious that our economy is seized up for lack of money. The extractive powers of the corporations are beyond our control. They took our wealth and offer to replace it with debt.

We didn't want that particular Koolaide so GOV took it on in our name. We knew / know that additional debt would have blow us way into insolvency. It seems certain that GOV will be blown into insolvency.
At the base of all of this, we have Keynesian economics that is a surefire failure. We have a slip into socialism that is a surefire failure.
We do have a temporary reprieve. Use the time wisely.

[can't sit still]

Did you ever get the feeling that GOV was lying to you? Here's some info from the Daily Reckoning.
"For the 19th consecutive month, the national budget fell disastrously short of anything close to balanced. According to the Treasury Department's own figures (itself a highly suspect data origin) April's $82.7 billion deficit was almost four times the shortfall registered in the same month last year."
OK, so that's the deficit. 4 times as bad as last year. That's the good part.
"That figure of $82.7 billion is merely the BS figure Treasury puts out there when it reports the deficit. The real tell is how much the national debt grew. And in April, that figure was twice the size of the 'official' monthly deficit - $175.6 billion.
I'm sure that GOV probably has some good explanation of how the national debt can grow twice as fast as the deficit. They probably also have an explanation of why the debt can grow this fast during the month when they collect income tax

The Daily Reckoning also had this to say concerning GOV;
"Contrary to popular belief, the achievement of the parasitic welfare state is not that it confers necessary services on the governed, or that it provides a magical safety net for the underprivileged and unwashed among its masses. Instead, like the wolf in Aesop's fable, its greatest accomplishment is one of cunning deception. To wit, the welfare state manages to convince - on a grand scale, no less - otherwise reasonable voters that it is not in the business of peddling unnecessary disservices at great taxpayer expense when that, in a nutshell, is its very essence of being"

[can't sit still]

After reading a ton of papers and graphs, it appears that the U.S. needs to make some big cuts. The U.S. could get it's financial house in order if it cut out both Social Security and the military.
http://blogs.telegraph.co.uk/finance/ed ... world-imf/
One of the main weaknesses is that U.S. debt has an extremely short maturity. GOV needs to borrow constantly from the bond market.
GOV may think that it has everything under control. Problem is, GOV doesn't have very much money. He who has the gold,,, makes the rules.
The bond market can overpower any moves that governments make.
http://www.marketwatch.com/story/sovere ... eid=YAHOOB
If the U.S. tries to inflate away the debt, the bond market will demand more interest.

Damn near everybody is projecting the death of the Euro. One group that has been very good at the predicting business is calling for the opposite;
http://www.leap2020.eu/GEAB-N-45-is-ava ... a4666.html
They are also calling for the total demise of the British pound,,, and economy.
When interest rates rise, the game will be over. There really isn't a solution. If GOV cuts way back on spending, the economy will severely diminish and reduce tax revenues that are needed to pay bond holders.
The bond market knows that sovereign debt is unpayable. If they pull out of the market, the crash will make it even more unpayable. The same will happen if they demand more interest.

[Trishntek]

Heaven forbid they even consider cutting taxes.

[Rabbi Dali Rick]

OK, so that's the deficit. 4 times as bad as last year. That's the good part. "That figure of $82.7 billion is merely the BS figure Treasury puts out there when it reports the deficit. The real tell is how much the national debt grew. And in April, that figure was twice the size of the 'official' monthly deficit - $175.6 billion.

that's an easy one. you add the two together, and that's the final number....




the rebbi

[can't sit still]

The bond service problem really doesn't have a solution. Everything crashes if changes come rapidly.
The main problem is the lack of tax revenues from the corporate sector. Corporations used to pay 30% of the tax load. Now, they pay less than 3%. The corporatocracy bought the GOV,,, and courts. The money that would have gone into taxes was removed from the economy and used to buy bonds. As all the money is sequestered from the economy and moves into instruments, the economy weakens. In the end, there is less money for the corporations.
By avoiding taxes, they have impoverished the economy and drastically cut their profits.
Part of the reason that Greece is ahead of the pack is because nobody paid their taxes.
Taxes aren't necessarily good. But, when corporations get monopoly power, they squeeze out every dollar they can. Corporate taxes are a means to grab part of their excess profits away from the limbo of the bond market and get it working in the economy.
In many ways, the bond market is analogous to gold. It's wealth that is no longer "working" in the economy. When taxes are collected and applied fairly, they keep more money in circulation.
When you add high taxes on top of the predations of paying monopoly pricing to the backs of the working man, he goes broke and the economy suffers.
When you lock up all the money outside of the productive economy, you get the same result. By extending monopolies and avoiding taxes, the corporatocracy has robbed the economy of it's working capital. No working capital,,, no jobs.
Burners !!! LMK if this makes sense OR if you think I'm delusional.
Thanks, Dan

[Trishntek]

There is no doubt more people worldwide are hoarding these days more than anytime in our generation. Why should Corporate America be any different?

[Sail Man]

Something I ran across today: More doom and gloom, how accurate I don't know but I plan and prep accordingly.


Default 24 Experts Warn of 2010 Meltdown

Now here's some serious doom and gloom.
Predictions For The Rest Of 2010


Bob Chapman
First 6 months of 2010, Americans will continue to live in the 'unreality'…the period between July and October is when the financial fireworks will begin. The Fed will act unilaterally for its own survival irrespective of any political implications …(source is from insider at FED meetings). In the last quarter of the year we could even see Martial law, which is more likely for the first 6 months of 2011. The FDIC will collapse in September 2010. Commercial real estate is set to implode in 2010. Wall Street believes there is a 100% chance of crash in bond market, especially municipals sometime during 2010. The dollar will be devalued by the end of 2010.

Gerald Celente
Terrorist attacks and the "Crash of 2010". 40% devaluation at first = the greatest depression, worse than the Great Depression.

Igor Panarin
In the summer of 1998, based on classified data about the state of the U.S. economy and society supplied to him by fellow FAPSI analysts, Panarin forecast the probable disintegration of the USA into six parts in 2010 (at the end of June – start of July 2010, as he specified on 10 December 2000

Neithercorps
Have projected that the third and final stage of the economic collapse will begin sometime in 2010. Barring some kind of financial miracle, or the complete dissolution of the Federal Reserve, a snowballing implosion should become visible by the end of this year. The behavior of the Fed, along with that of the IMF seems to suggest that they are preparing for a focused collapse, peaking within weeks or months instead of years, and the most certain fall of the dollar.

Webbots
July and onward things get very strange. Revolution. Dollar dead by November 2010.

LEAP 20/20
2010 Outlook from a group of 25 European Economists with a 90% accuracy rating- We anticipate a sudden intensification of the crisis in the second half of 2010, caused by a double effect of a catching up of events which were temporarily « frozen » in the second half of 2009 and the impossibility of maintaining the palliative remedies of past years. There is a perfect (economic) storm coming within the global financial markets and inevitable pressure on interest rates in the U.S. The injection of zero-cost money into the Western banking system has failed to restart the economy. Despite zero-cost money, the system has stalled. It is slowly rolling over into the next big down wave, which in Elliott Wave terminology will be Super Cycle Wave Three, or in common language, "THE BIG ONE, WHERE WE ALL GO OVER THE FALLS TOGETHER."

Joseph Meyer
Forecasts on the economy. He sees the real estate market continuing to decline, and advised people to invest in precious metals and commodities, as well as keeping cash at home in a safe place in case of bank closures. The stock market, after peaking in March or April (around 10,850), will fall all the way down to somewhere between 2450 and 4125 during the next leg down.

Harry Dent (investor)
A very likely second crash by late 2010. The coming depression (starts around the summer of 2010). Dent sees the stock market–currently benefiting from upward momentum and peppier economic activity–headed for a very brief and pleasant run that could lift the Dow to the 10,700-11,500 range from its current level of about 10.090. But then, he sees the market running into a stone wall, which will be followed by a nasty stock market decline (starting in early March to late April) that could drive down the Dow later this year to 3,000-5,000, with his best guess about 3,800.

Richard Russell (Market Expert)
(from 2/3/10) says the bear market rally is in the process of breaking up and panic is on the way. He sees a full correction of the entire rise from the 2002 low of 7,286 to the bull market high of 14,164.53 set on October 9, 2007. The halfway level of retracement was 10,725. The total retracement was to 6,547.05 on March 9, 2009. He now sees the Dow falling to 7,286 and if that level does not hold, “I see it sinking to its 1980-82 area low of Dow 1,000.â€

[can't sit still]

And even fewer of them are saying it's time to pull one's pants down whilst running around in circles and screaming that the sky is falling.

Well now, it looks like more people are starting to get the hang of running around dodging shit from out of the sky.
It was 3 years ago [minus 10 days] that I tried to get y'all to batten the hatches. Ygmir finished his bullet-proof shutters. What have you done? If/when all this shit does hit the fan, you're going to wish that you had started earlier.
I keep harping on the fact that you have to worry about the people who are NOT prepared. I've been around people who flipped out. Don't expect a shred of logic. If they have kids, run for the hills.
The number one thing that you have to worry about is a scarcity of diesel fuel. Imagine our economy run at the Amish level.
I started this thread to give you a "heads up" Now, that the "weakness" of the economy is center stage, YOU can pay attention to it,,, like your life depends on it.
If you're running a bit late, you can get up to speed faster with a like minded group;
http://www.ic.org/

[can't sit still]

A couple of 'heavies" expect the London Stock Exchange to get kicked out of the FTSE,,, next month;
http://blogs.telegraph.co.uk/finance/ia ... ect-storm/
Dunno if it will happen. It seems a bit extreme.
The hedge funds expect to take down the Euro;
http://www.telegraph.co.uk/finance/news ... -euro.html
The senate voted to approve a new bill to regulate banks. It remains to be sen if it has any teeth;
http://www.telegraph.co.uk/finance/news ... l-Act.html
Things are on the move. It's too early to know what the results will be.

[can't sit still]

Jim Willie has a great article that covers most of the worldwide financial problems;
http://news.goldseek.com/GoldenJackass/1273712400.php
I won't quote it but, it is WELL worth a good read.

[1durphul]

Heaven forbid they even consider cutting taxes.

Cutting taxes while we owe money? That's just stupid. They should be cutting spending, and maintaining the tax rate until they've paid off the HUGE debt that the boomers authorized through their representatives in congress and the senate.

Cutting taxes right now would be like running your credit card up to the max and then quitting your well paying office job to go work at McDonald's in order to pay your recurring monthly necessity bills (base gov't spending), while continuing to pay off your credit card.

[Rabbi Dali Rick]

heir rebbi

[Trishntek]

Heaven forbid they even consider cutting taxes.

Cutting taxes while we owe money? That's just stupid. They should be cutting spending, and maintaining the tax rate until they've paid off the HUGE debt that the boomers authorized through their representatives in congress and the senate.

Cutting taxes right now would be like running your credit card up to the max and then quitting your well paying office job to go work at McDonald's in order to pay your recurring monthly necessity bills (base gov't spending), while continuing to pay off your credit card.

Hate to break it to you, but when Reagan cut taxes in the 80's, tax revenue DOUBLED, inflation dropped out of DOUBLE DIGITS, and interest rates dropped out of DOUBLE DIGITS. People get back to work and investments rise and debts are paid,,,, novel idea, eh?

But then,,,, money is nothing but empty promises on pretty paper these days.