The Long Cold Winter

[Sail Man]

some of us listen........

Don't worry, we know you've stashed your nuts

[can't sit still]

Glad that your cheeks are warm. The general idea of a society is that we help each other out. The alternative is a Mad Max situation where only the strong survive.
If YOU can't help a few of the weaker members of society, who is going to help them?
If nobody will help them, what kind of a world do you expect to find when the dust settles?
I'm talking about the children. They didn't ask for this. They didn't abet it.

The Cloward-Piven strategy used in both NYC and Chicago calls for a crashing of the social-net. They expect a better system to arise out of the ashes. The health care bill seems to be a big move towards that end. What do you expect will happen when all the tethers of the social-net are cut loose?

There are 100 million children living on the streets worldwide. They machine-gun packs of them in Brazil. In Argentina, thousands subsist on trash. Asia is no bargain either.

Our system pays for our labor with currency-tokens. "They" can buy a LOT more labor for the same amount of tokens in other countries. American industry embraced this with open arms. Now, we have lost our job. WE aren't mentally prepared for a life of poverty.
Our aggregate national income is rapidly dropping at the same time that our debts come due.
The infusion of MORE credit is causing a reduction of available money. GOV is competing with private industry for the available money. NOBODY has any capital. GOV / GS is sucking out the last of the lifeblood.

50% of Americans rely on a check from GOV,, directly or indirectly. What would happen if those checks stopped arriving? Bernanke said to cut it off. GOV wants to print. Bernanke said that he wouldn't.

Those tokens that you hold only have value if the corporation of European bankers who printed them continue to support them. Even then, they are going to continuously lose value.

[Rabbi Dali Rick]

THIS THREAD HAS BEEN LABELED AS SEDITIOUS AND YOU ARE ALL BEING WATCHED, LOGGED, AND CATALOGED.





All Post Will Be Held Against You In A Court Of Law.







heir rebbi

[Sail Man]

I swear it, they will have to pry my nuts from my cold, dead paws

[can't sit still]

Sail Man, your nuts should be put in an out-of-the-way place. maybe in a sailboat out in the Windward islands.
Rabbi, in the final analysis, GOV has far bigger problems than my scribblings.
That doesn't mean that they won't hang me someday.

Well, there's no shortage of people with an opinion on the economy. James Grant says that the US GOV is slowly losing it's creditworthiness;

The Pragmatic Capitalist says that he's all wrong because GOV has "taxing authority"
http://beforeitsnews.com/news/29815/Jim ... ating.html
The P C seems to forget that all the wealth in America couldn't pay off the debt. Any revenue increases brought about by tax increases would be canceled out by the decreases in economic activity.

Gold is back in the news. The Commodity Futures Trading Commission held hearings about the manipulation of the precious metals market.
The bullion banks inadvertently admitted that there is 100 times as much paper gold as physical metal.
A whistle blower who testified was run over after he left the hearings;
"Maguire has taken some personal risks to tell all this in public. In fact, almost immediately after his initial statements, he was run over by a car while walking down the street."
http://www.huffingtonpost.com/nathan-le ... 19893.html

It also seems that the PTB did NOT like the testimony at the hearings.
"Would you be surprised to learn that the cameras had a "technical malfunction" during Bill Murphy's statement, which magically righted itself immediately after he finished?

After the hearing, according to Douglas, Murphy was contacted by several major media outlets for more interviews. Within 24 hours, all the interviews were canceled. All of them."


The London Bullion Market Association trades hundreds of tons of gold a day. It isn't actually moved generally. The gold is used as an "anchor" for fiat-money transactions. Both gold and oil are used as a reference point for fiat money transactions. That's why gold and oil have historically traded at a par.


Most of the foreign gold holders have removed their gold from London and New York. This has had the effect of removing most of the "chips" from the "poker game" http://fofoa.blogspot.com/2010/03/1001.html


Also, the Swiss have found one of the reputed tungsten-cored gold bars. Supposedly, there were 1.4 million of them manufactured. Everybody is repatriating their gold and re-melting it.


All currencies are essentially commodity backed. Oil and gold are the references. The US is not producing much in the way of commodities and our currency will weaken.

We live in the machine-age. Most of the productivity is from machines. The banks have sequestered away $ quadrillions. As the aggregate implementation of machines increase, the aggregate wages of people decrease. We could cover all of North America with machines that produce goods and food. Who could buy it?


The banks have $ trillions in bonds. The bonds only have value if they can be redeemed. As we have more and more machines producing more and more goods, we have fewer and fewer people able to purchase them.

As the overall percentage of employment goes down, the utilization of industrial capacity goes down commensurately. The value of worldwide aggregate wages is going down at the same time that worldwide production capacity goes up.


GOV [banks] is focused on getting people to borrow money to re-activate the industrial sector. The output of the industrial sector will always be related to the purchasing power of human buyers. The productivity may jump up during a credit bubble but, it will revert when the bubble subsides. In the final settlement, the earnings of the financial sector depend on activity of the productive sector.


This is a new game because now, market forces between buyers, sellers and labor are "equalized" in a VERY short time. With instant communication, there is very little "market advantage"to be found. With the exception of wages.

The MARKET is now dictating the connection between buyer's aggregate wages and industrial / financial capacity utilization. GOV has tried to artificially stimulate capacity utilization by spending tomorrow's wages. GOV / Banks know that bonds can't be redeemed unless people are working. The conundrum is that GOV spends about 1/3 $ million to create a new job.


There is NO WAY that aggregate global wages are going to increase. Global productive capacity is increasing. With our current wage / productivity structure, either effective wages have to increase or productivity has to decrease.


GOV can create demand by having a war and destroying goods. This also creates jobs for soldiers. But, because this is the Machine Age, it creates very few jobs,,, and on credit, at that.

In the final analysis, our system creates credit FAR faster than it creates jobs. Eventually, there has to be a reconciliation. Will credit instruments evaporate or will the sequestered money flow into wages?

Dan

[can't sit still]

This is an old but, interesting article. It argues that the big problem with the stimulus package is that the money can't be absorbed. Very interesting. It also has a great map showing where jobs have been lost and created.
http://www.leap2020.eu/Programmed-failu ... a3925.html

[can't sit still]

This is another article talking about absorption of stimulus money. http://www.kitco.com/ind/Turk/turk_apr052010.html
It's well worth trying to understand. The chart agrees with other charts and numbers for the same problem. For every $ 1 that GOV injects into the economy, the GDP SHRINKS by 45 cents. Some of this stuff that I post is difficult for me to understand and integrate into some kind of complete picture.
One of the VERY important facets of the chart is the RAPID decline; "In the third quarter of 2009 each dollar of debt added produced NEGATIVE 15 cents of productivity, and at the end of 2009, each dollar of new debt now SUBTRACTS 45 cents from GDP!â€

[can't sit still]

Well, as MSM contemplates the recovery,,, Bernanke pats himself on the back,,, Greenspan denies culpability,,, bank profit is up 63%,,,, what about John Q Public?
". March 2010 saw 158,000 bankruptcy filings" "up 35% from last month’s (February 2010) number" Foreclosures are expected to go up 7 fold.
http://www.marketoracle.co.uk/Article18600.html
A 35 % rise in bankruptcy filings. A huge rise in long-term unemployment. 39 million on food stamps. 4.5 million more foreclosures projected for this year. 8 million unemployed.
Keep in mind that ALL of this good news was accomplished for only about $ 15 trillion. We went off a cliff and bought a $ 15 trillion set of brakes. I read that there would have been 2 million more unemployed without the stimulus.
So much for the good news.
GDP is flat. Taxes are going to go way up. Everybody is agreed that increased taxes have a 3X negative multiplier for the GDP. Taxes are scheduled to go up equivalent to 2% of GDP. OK, cool. seems to be fine with our spender-in-chief. NOBODY is denying that this will reduce GDP by 6 %
So, at the moment we have a problem with insolvency and unemployment of John Q Public. WTF is John Q Public going to do when the GDP shrinks 6% ?

Keep in mind that our steadily diminishing productivity has to service our steadily increasing debt load. The congressional budget office says that debt service will take 100 % of the budget in a few years. It is projected to go "critical" about the third quarter of 2011. Bond auctions are already weakening. The sooner we have to pay higher interest rates to borrow, the sooner the debt load will go critical.

OK, so the spender-in-chief is crashing the GDP while the states are melting down and taking the safety net with them. What is John Q Public going to do?
REAL unemployment is stated to be 23 % ALREADY. Shadow Stats has very good numbers. So, GDP and the states are going into a continuing future crash but we already have unemployment that is only 2 % below the worst of the great depression.
Can John Q Public count on DC to fund the entire safety net? Even if food stamps and unemployment are funded, that won't pay for the house. Judging by the big cutoffs in unemployment extensions, I don't think that DC is going to pay for everything.

The banks seem to have first-call on the money. What shape are they in?
This is an excellent paper talking about how economists look at the wrong sector of finance when it came to looking for danger;
http://www.nakedcapitalism.com/2010/04/ ... apitalism) Dunno about the cutoff in the stupid URL

The paper seems to prove that flow of credit is more important than the actual amount. It has great graphs.


There is a lot of discussion of the popular revolutions in France and Russia. Some speculate that they will be the "pattern" for popular revolutions in other countries.
http://www.globalresearch.ca/index.php? ... leId=18529

Australia has a couple of great economists. This very-excellent paper shows why a ever-increasing GDP is need to service a non-increasing debt;
http://www.debtdeflation.com/blogs/2010 ... half-time/
Great paper. You can skip the first few paragraphs.

So, tell me,, what is John Q Public going to do for his family when his savings run out?
What are the states going to do when the budget collapses?
What is the spender-in-chief going to do when debt-service goes critical?

[can't sit still]

Well, GOV definitely has on their rose-colored glasses. They claim that retail sales have gone up 7.8 %. Yet, the states claim that sales tax is down 7.2 %
"we are experiencing the very best recovery that several trillion in freshly minted money and credit can buy. Frankly, I expected more. I am underwhelmed"
http://www.financialsense.com/Market/wrapup.htm
Most of the recently reported increase in employment can be attributed to census workers and massaged numbers from the birth-death model.
GOV is doing all that it can to keep bond buyers in the market. You can't blame them for trying. Things will get much worse when the bond market collapses. The bond market is supposed to go "critical" by about the third quarter of 2011;
http://home.comcast.net/~lcmgroupe/2010 ... y_Wall.htm
Reportedly, only 5 % of the wealth in the world is in tangibles;
http://news.goldseek.com/GoldSeek/1271264455.php
That puts ALL instruments into jeopardy should the holders of instruments decide to bail. The answer for this problem is to create even MORE instruments. Everybody is getting in on the act;
http://www.caseyresearch.com/displayGsd.php

The Japanese example seems to show that the effect of the stimulus will be fairly short lived;
http://www.caseyresearch.com/displayCdd.php?id=401
Since we have an election coming up, I suppose that we can expect more stimulus.
The banks and Keynesian economics in general require a constantly expanding credit bubble. Every institution in Christendom is blowing bubbles as fast as they can. History says that it will not end well.

[can't sit still]

I try to find info that is balanced. It may appear tilted towards gloom and doom. GOV and MSM is touting so much obvious BS that, I tend to lean in the opposite direction. The serial pessimists from 4,5,6 years ago have ALL professed that they weren't pessimistic enough
The Greek tragedy is not going to play out well. There are just TOO MANY other basket cases in line. In actuality, the Euro is direct competition for the dollar. The U.S. GOV won't cry at the demise of the Euro.
With $ trillions pumped in, the industrial economy here is still losing ground,,, graph;
http://www.caseyresearch.com/displayCdd.php?id=404
Gold is up 15 % every year. It's up 34 % in the last 12 months. In the long term, gold does not go up or down. It's the fiat currency that drops. So, the dollar has dropped 34 % in the last year. http://www.24hgold.com/english/news-gol ... er+Wiegand
Almost all countries are inflating their currency to gain market share of manufacturing,,, competitive devaluation. The world GDP is 4 times what it was many years ago. The amount of currency in circulation for the same period is about 300 times as much.

This currency inflation makes an exporter more competitive and increases business. The resulting value depreciation of a currency makes it LESS attractive to bond investors. That's why bond buyers desert a country that is devaluing it's currency. Most bond buyers have left the U.S. to go to countries that actually offer a return. Oz and India and some Asian countries are attracting bond investors. One of the proprietary Indian funds has returned a steady 18 % for the last several years.

This is from the Merck Fund,, an authority on currencies,, they don't like the dollar;
http://www.merkfunds.com/merk-perspecti ... 04-15.html

This is a PDF that sounds a bit pessimistic but, the pessimists have been generally right
http://www.alternativeinvestingfacts.co ... r14-10.pdf
" You have an economy that is literally bleeding from the femoral artery as the nation's left leg has been severed above the knee by a bunch of homicidal
maniacs on both Wall and K Streets. The patient is alive only because they are pumping in blood at a rate that exceeds that which is spraying all over the floor while you're calling the patient "healing"?â€

[can't sit still]

In 2002, Robert Precter forecast the whole shebang with details. He was right on all counts.
http://www.tradingstocks.net/html/infla ... t_bub.html
The raging argument at the moment is deflation vs inflation. Precter says DEFLATION. I'm going to take him at his word. One has to be sure to differentiate between price deflation and currency deflation.
Prices on a few things are going up. The amount of currency in circulation is going down.... both the quantity and the velocity of changeover. In some cases, the velocity of money is more important than the quantity. The FED can print money but, they can't get people to spend it. GOV is more than happy to spend it though. The problem comes in when people use the money to pay off debt rather than creating new debt. Debt needs to constantly grow to provide the money to pay off previous debt AND interest. If increasing debt isn't created, there are not enough funds to pay interest and principle.

Paying off private debt destroys a portion of money in circulation. Precter says that so many people are paying down debt that it is destroying money rapidly. The money supply is going down. The FED may print money but, it has no reality until some producer claims it as debt.
When a person defaults the amount of money that was created as debt by the loan is destroyed. That debt was a bank asset. Upon it's destruction, the assets of the bank diminish.
The FED printed new money for the bank but, that new money is not circulating in the economy. The new money is nothing until it is someone's debt.
The amount of money in circulation in the economy is decreasing at the same time that the amount of money in the financial system is increasing.
The circulating money is decreasing while the non-circulating money is increasing.
I'm starting to lose my grasp of the picture.
GOV debt is increasing. Bank money is increasing. Private money is decreasing.
I'm sorry but, my brain just short-circuited.

[FIGJAM]

Zietgiest addenduem made this simple for me to understand. Dont let your head explode. I value your views. I dont believe all i hear or read till i check other sorces, and then believe 10 percent may be true. Sometimes 10 percent fact is still scarry enough.

[can't sit still]

FIGJAM, thanks for the kudos. It was more of a short circuit than an explosion. I'm sure that you're correct about my need to see zeitgeist and the addendum. Any links
I'm feeling lazy at the moment.

India has just reported that 410 million people are living on $ 1.25 a day or less. Other reports say that 25 % of our jobs can still be outsourced. Pensions will soon be a thing of the past for most old folks.
The banks are making record profits,,, at the moment. This is all done without actually creating any wealth or productivity. Money has shifted out of the productive economy and into financial instruments.
The interest rates would have to go down to push money back into productivity. Interest rates are going up. The productive economy is starved for credit. The productive economy will continue to crash for lack of money,, lack of credit,,, lack of buyers.

[FIGJAM]

http://www.zeitgeistmovie.com/

[FIGJAM]

Addenduem has world wide percent of population at 50 percent at under 1 dollor a day. You may not agree with everything they say, but its like i said , if only 10 percent is true its bad enough.

[FIGJAM]

Oh, and my 10 percent truth theory is just to keep me from getting overwelmed or carried away.......lol..

[can't sit still]

I watched some of "addendum" It's quite correct. What they argue is that a corporation is inherently evil. Not necessarily be intent but, by design.
It's long been known that if an entity charges compound interest without stopping, it will eventually own everything. A corporation is just a pile of money trying to grow larger.

Keynesian economics demands an ever-increasing expansion of credit. It motivates this by stipulating and encouraging an ever-increasing growth in population.
Strictly speaking, a corporation is parasitic. It extracts from the many and passes it to the few. A "bricks and mortar" corporation takes a raw material and adds value by processing the material into a product. A bank is comparatively more parasitic because it does NOT add value.
A person who walks down the beach and pics up gold nuggets and fish is suppling material wealth to society. A bank extracts wealth from every party. Since a bank is a corporation, it needs to continue to grow. It must always stay ahead of the inflation curve. But, banks have overhead. They must, not only extract to stay ahead of inflation, they must pay their overhead.

The "Corporatocracy" being a monopoly can dictate wages and prices. Since they've gained so much power, they can also dictate taxes. The recent Supreme Court decision also allows them to buy elections.
Not surprisingly, they prefer to NOT pay taxes.

Yes, I know that the pic need to be bigger. The line creeping along the bottom is the taxes paid by corporations. The upward sloping line is the GDP. Corporations used to pay 30 % of the tax load. They paid to have the law changes. It was far cheaper than paying taxes. Now, they pay 3 %.
The "extra" money that would have gone into the treasury has gone into financial instruments. Many years ago, 43 % of the wealth was in financial instruments. Today, it's about 74 %.
So, the safety net is strung up on pure debt,, not wealth. The infrastructure is falling apart. Quality of life is shitty. 1 % of American adults is in the prison system.

A corporation has no soul,, no heart and Certainly no noblesse oblige. And it doesn't die. This extractive system has progressed nicely to the point where America has the poverty rate of a third world country.

Much to it's detriment, a corporation has no eyes. It takes advantage of "global wage arbitrage" to produce products in low wage countries. Then, it takes those products and tries to sell them to the newly-unemployed people who were formerly purchasers of these products.
So, the corporatocracy shoots itself in the foot.


After WW II, the US had all the manufacturing capacity. Since then, everybody went out and built factories. Now, the world has FAR too much manufacturing capacity. While it was building all this capacity it was consolidating and streamlining. The God of efficiency was slashing jobs right and left.
Our wonderful Keynesian GOV borrowed money to maintain employment. But, as the corporatocracy achieved even more efficiency, GOV had to grab even more money to support employment.


The corporatocracy signed trade agreements to try to preserve it's profit. People were a secondary problem. But then, the lack of jobs cut into the purchasing power of the masses. Greenspan blew all those bubbles in YOUR name to try to suck in enough wealth to keep YOU working.
The Indians and Chinese didn't have enough discretionary spending to keep the corporatocracy inflated.

The banks can only survive in a revved-up economy. They need a big margin to stay ahead of inflation and overhead. They got the Treasury [us] to lend at 1/4 of a percent to keep them solvent. [margin] That wasn't really doing the trick so, they printed lots of money.


This money is debt,,, NOT wealth. If Joe Producer works for $ 150 a day, he gets no work. There are 2.5 billion people who are willing to work for $ 5 a day. so, we drift towards a "global mean wage"
Discretionary spending and tax revenue are falling fast. Bankruptcy and foreclosure are rising fast. The corporatocracy has extracted so much wealth that there is insufficient wealth circulating.
The money circulating in the banking system is 100 % debt. It's actually 100 % paper and pixels. The corporatocracy has withdrawn the money and the credit.

You must consider what wealth is; to a person,,,, to a corporation.
A corporation strives to amass financial assets and tangibles. It strives to hold market-share. It strives to hold monopoly.
It does NOT strive to preserve the purchasing power of individuals. It does NOT strive to sell at the lowest margin unless forced by competition. It does not concern itself with the good of society and the family. In short, it does NOT work for the betterment OR solvency of society. It's strictly parasitic.

An individual is generally striving to survive,,, some happiness,,,some quality of living.
NONE of these are concerns of the Corporatocracy.

OK, so we invent GOV to promote the needs of society and individuals. The big problem comes in when GOV is taken over by the corporatocracy. There is NO ONE looking out for society.

WE've reached a point where the predations of the corporatocracy have reduced the ability to survive. The corporatocracy has noticed that it's wealth and power are diminishing as our fortunes diminish. It does NOT appear that the corporatocracy has any meaningful plan to augment our chances of survival.

Chavez has sent some heating oil to the poor here. The U.S. GOV is handing out food stamps. I don't see any other meaningful attempts from GOV or the corporatocracy to try to reanimate the destroyed nation.
The old economy that was built and sustained on debt is coming to an end. The corporatocracy in it's singleminded pursuit of profit has destroyed the viability of it's customers. It can produce endless goods but, it never tried to support a healthy economy.
As the aggregate purchasing power for non-survival goods falls even lower, many countries are locked in a struggle to see which country is going to keep it's citizens employed. The U.S. is far too corrupt at the upper levels of GOV and finance to ever be competitive. The jobs won't come back. The legitimate bond buyers left long ago. They know that the bonds are only promises made against future delivery of goods and services. Public and private revenues will never recover.

As the dollar loses value, gold will go up. Oil is tied to gold. Oil will go way up and strangle whats left of the producing economy. I suspect that we will have a mixed bag of price inflation and deflation.
The carbon tax and the VAT tax and the Health Tax will all contribute to a severe fall in the economy.
One of the founding fathers said that if we let a central bank get control of this country, our children would curse us in our graves. Sorry.

[can't sit still]

I forgot to put up the relevant links to the last post.
http://home.comcast.net/~lcmgroupe/2010 ... Crunch.htm

Here's a very good paper on the change to a multi-polar world. Too many Americans just don't see the changes;
"Already in 2008, China passed the U.S. as the world’s leading manufacturing nation—a title the United States had enjoyed for over a century"
"reserve currency ensures American preeminence, and if it loses that status, hegemony will be literally unaffordable. "
Conventional warfare is exorbitantly expensive. Because of budgetary restraints, the U.S. will have to increasingly rely on "weather warfare" to drag down it's economic and strategic competitors.
http://www.weatherwars.info/
http://www.globalresearch.ca/index.php? ... a&aid=1061
The ongoing presence of chemtrails seems to be an effort to make the atmosphere conductive so that these Scalar Tesla weapons won't be used against US.
http://vodpod.com/watch/2949997-chemtra ... bal-poison

There is much "debunking" of chemtrails. There are quite a few high-tech industries that need clean-room assembly. When they check their air filters, they find them loaded with aluminum and barium. There is NO possible source for atmospheric barium in all these filters.
The U.S. just can NOT afford these wars;
" According to the New York Times, when presented with an OMB projection that showed existing troop deployments and nation-building expenses combined with the cost of sending an additional 40,000 troops to Afghanistan for a decade would total $1 trillion, “the president seemed in sticker shock, watching his domestic agenda vanishing in front of him.â€

[Trishntek]

CSS: Thank you for all the shit your stir! You are truly one busy prophet of doom and confirm my comfort in possessing real precious metals rather than paper promises.

It was Thomas Jefferson who said:

"I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs."

Thomas Jefferson on coin and paper currency:

“Specie [gold and silver coin] is the most perfect medium because it will preserve its own level; because, having intrinsic and universal value, it can never die in our hands, and it is the surest resource of reliance in time of war.â€

[can't sit still]

Trish, you're very welcome. I'm stirring about as fast as I can. If we're going to claim that we believe in "community", then we should let others know what we see approaching. I never had any intention of making this thread my private soap box. I'm a bit surprised that there aren't more contributions. There is a pretty high number of visits but, not much posting.
The "survival " thread received more visits per month than 'Winter" Is this thread too boring,,technical,,,gloomy?
We're making history every day. Believe it or not, the FED has done a very good job of maintaining the value of the dollar. MANY other countries have had huge currency devaluations. Mexico and Brazil have regularly knocked off 3 zeros from the value of their currency. Same with France, israel, etc
The Federal reserve has actually been very reserved at money creation.
The banks ran with the bit in their teeth. They've created so much "money" that it can only be expressed as instruments, NOT tangibles. That is going to be a big problem.

WE've reached a juxtaposition where; wealth in instruments is going to the moon. Production capacity is beyond what can be utilized.,,, the "machine age" can bestow miracles with the touch of a button.
WHERE does man fit in to the picture? He's increasingly left out of the loop.
The whole point of production is CONSUMPTION. NOT by other machines. The Corporatocracy is so focused on production and competition that it has forgotten consumption.
Our non-credit economy shrinks down to where it is commensurate to the amount of wealth extant. This shrinking causes more unemployment,,, which lessens the wealth. Then, the economy has to adjust once again to reflect the diminished wealth.

The corporatocracy can't legislate consumption so, it gets GOV to consume in our name [debt]. This is supposed to be payed back eventually. If GOV raises taxes, it has a 3X negative multiplier for the economy. So, GOV will have to cut expenditures to the bone.
If the military / industrial / banking complex is unwilling to take huge cuts, the cuts will have to come from Domestic programs. The reported unfunded liabilities are $ 101 trillion. $ 17 trillion for SS,,, $8 trillion for Medicare. I believe that I read the the underfunding for public-sector pensions in America was $ 70 trillion. GOV has already said that returning military are potential terrorists. Just imagine the potential when 10 million G-men lose their pensions.
Social Security was projected to "go broke" in 2024,,, then 2020,,, then 2016,,, then 2012,,, then it was admitted,,, 2010. Not so much go broke as, need to redeem the $ 7 trillion in IOUs held by treasury.
State of Ca said that they were short by $ 3 million. Then, every few weeks they revised it upwards by a few million.
I think that it is safe to assume that GOV will reach a funding crisis sooner than they let on. Keep yer powder dry.

[can't sit still]

Well, if you look at Iceland, the private banks had a problem. The banks screwed the GOV into accepting the responsibility for the shortage of money. This happened in Greece, Argentina, and many other countries. The banks gamble and lose. Then they force the GOV to assume the debts in the name of the public.
Since GOV doesn't have enough money, they have to rely on banks. When banks have a problem, GOV has a problem. Since the whole shiteroo was based on debt, rather than wealth, the shortfall gets bounced back and forth between GOV and banks.
http://www.sprott.com/Docs/MarketsataGl ... akness.pdf
The U.S. banks have dumped their gambling losses into the lap of the public. The productive sector crashed and it's obvious that the notional value of the debts won't be paid. The banks may dump $ 20 trillion of debt into the the public's pocket but, what about the other $ 1 quadrillion that has to be unwound eventually?
The debt crash will take down both the banks and GOV. Neither has the wealth to pay off the debt.
If Huffington Post is correct about Goldman Sachs going bust soon, then their paper will have to be unwound rapidly. It can't possibly happen in an orderly fashion.

Most of the "wealth" of the world is shoved into paper assets because there isn't any way for it to be "expressed" in tangibles. Any kind of a panicked exit from G.S. could cause a panicked exit from paper assets.
If this happens, just load the last of your supplies into your sailboat and catch the next tide.

[Trishntek]

Just passing on something told me by my guy who sells tangibles (gold and silver). He told me straight up that by July 8 (end of 2nd quarter?) of this year shit is gonna hit the fan. He would not specify other than saying "banking" industry will be chaos by the end of the summer.

Sorry, that's probably more than I know but thought you who care would understand and appreciate.

Also, I've found a bank which has no relationship with the gubmint other than what is legally necessary. They made zero toxic loans, receive no public funds and have $3.5Billion in assets and they've been in business since 1847. I'm just saying they do exist and it is financial stewards like these who will weather a shit storm better than most.

[can't sit still]

As I mentioned a few pages back, the critical arena is the bond market. It appears that the contagion from Greece has pushed things over the edge;

"We have gone past the point of no return," said Jacques Cailloux, chief Europe economist at the Royal Bank of Scotland."There is a complete loss of confidence. The bond markets are in disintegration and it is getting worse every day."
In the age of instant communication,, instant money transfer and almost instant meltdown, things will move much faster than GOV can respond. The obvious strategy for GOV is to print money and give it to the banks. Banks run GOV so it isn't unlikely.
The bond buyers will try to exit from over-printed currencies. The Greeks already pulled their money out of Greek banks and deposited it in banks of stronger countries.
As the exodus continues, the weaker GOVs will be insolvent and unable to import.

The lights will go off and the water will stop. The resource-rich countries will create "letters of credit" based on exchange of resources. The weak countries will stop paying their employees. OPEC will catch a LOT of heat.
We shall see.

Just an update. Greece's deficit is 8.7 % and they've been downgraded. And, what is the deficit here;
Bill Bonner

"Greece's budget deficit is 8.7% of GDP.

Portugal's deficit is the same.

Spain's is higher - at 10.4%.

Where's the US deficit? Last time we looked it was projected to be as high as 12% of GDP."
So, our deficit is 50 % higher than Greece. A downgrade will cause the U.S. to hit the debt-maturity wall before next summer, as was originally expected.

http://commoditytradealert.com/blog/?p=6908

[can't sit still]

I found a couple of excellent articles. John Williams of Shadow Stats has been very helpful all along. He publicizes data using accounting methods that are not massaged by GOV
He claims that we won't be able to avoid hyperinflation. It's a very interesting paper;
http://www.theaureport.com/pub/na/6199

Eric Jantzen has also been right all along.

A couple of quotes;
"past behavior of the IMF in Latin America and Asia and everywhere else they’ve shown up to “rescueâ€

[Trishntek]

Well that confirms my overabundance of sex toys. Good barter material, I'm thinkin'.

[can't sit still]

Here's a good article talking about confidence in the system. Systemic confidence has ,over the years, resulted in systemic fraud.

http://uruknet.info/index.php?p=m65575&hd=&size=1&l=e

[Sail Man]

Well that confirms my overabundance of sex toys. Good barter material, I'm thinkin'.

Careful mentioning sex toys around Ygmir. The last time somebody did that he got so distracted that GrandPappy ended up "Rusting in Place"

[Trishntek]

Well that confirms my overabundance of sex toys. Good barter material, I'm thinkin'.

Careful mentioning sex toys around Ygmir. The last time somebody did that he got so distracted that GrandPappy ended up "Rusting in Place"

Oh he already made an appointment to be "punished for his sins" when we meet on the playa.

[1durphul]

Salon.com, for the first time in about 5 years, had an article on something other than feminism...

http://www.salon.com/news/bank_reform/i ... llar_fraud

Commercial banks, by law, have to hold a certain percentage of their deposits as cash at the Federal Reserve. From January 1959 until August 2008, the total of these reserves held by the commercial banks at the Fed grew from $11.1 billion to $46.2 billion. At no time during this almost 50-year period did the total bank reserves held at the Fed exceed the minimum required by law by more than $2 billion.

But since August 2008, these bank reserves held at the Fed have exploded to more than $1.2 trillion (as of March 2010), even though only $65.6 billion was required to be deposited by law.

This increase in excess reserves resulted directly from the Fed's policy of dramatically increasing the quantity (and lowering the quality threshold) of assets it bought in the marketplace. During the past 20 months, the Fed has tripled the size of its balance sheet by acquiring more than $1.5 trillion of new assets, more than $1 trillion of which are mortgage-backed securities.

What is going on here? Why would commercial banks hold $1 trillion more than they legally had to in reserves at the Fed, earning only 0.25 percent interest per year, and why would the Fed buy more than $1 trillion of mortgage securities of undisclosed quality in the marketplace?

Go to the link to read the rest.

[can't sit still]

That article appears to be misleading. The numbers are way too low. In '08, the banks were borrowing $ 437 billion a day.
http://www.reuters.com/article/idUSTRE49F97920081017
How long does it take to run up several $ trillion?
The other thing that doesn't look right in the article is the question about reserve funds. The banks were all insolvent. GOV loaned them untold $ trillions as a stopgap measure. But, the banks had to have earnings. So, the FED loaned money at .25 %. The banks were supposed to loan that money back into the economy to get things unfrozen.
The banks knew that the crash was temporarily put on hold. They knew / know that asset prices, RE prices and , eventually bond prices were going to collapse.
No way were they going to loan money to people in a crashing market. So, the banks put all the borrowed .25 % money into treasury notes at about 3.75 % . They made money on the spread. They didn't just sit on the money.
Of course, all those treasury notes have to be redeemed by you and me. There's no mystery where the excess reserves went.