Identifying Sure Signs Of The Final Economic Plunge

Giordano Bruno

Neithercorp Press - 01/12/10


Many researchers, including those here at Neithercorp, 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. Data indicates that the dollar and the Dow are running on nothing but false promises and fiat bailouts, and that this game is slowly winding down. The Fed cannot sustain its current rate of liquidity injections without raising the ire of foreign nations heavily invested in U.S. debt, especially when banks have refused to loosen their lending practices as promised, thereby hoarding all bailout funds made available to them and stifling any chance of a credit market recovery.

Understandably, an important question has arisen among those people who are trying to prepare for the event; When EXACTLY will the collapse occur?

Of course, we aren’t psychic, and narrowing down the final trigger to the exact day, or even the exact month, would be extremely difficult. However, what we can do is explain what signs to look for, how to look for them, and what dangers they foretell. Economics gives the appearance of a complex and confusing science, but most economic indicators taught in business schools are really hollow background noise, designed to do nothing more than make television investment analysts seem more intelligent than they really are. All we need to know are the fundamentals, the unchangeable concrete factors that all economies operate on, and how to tell when they are beginning to falter. The following list is composed of signs anyone with a little work and a little vigilance can keep track of, giving them an even greater edge in knowing when the house of cards is really about to topple…

Gold And Dollar Decoupling

Although U.S. Treasury markets and the dollar are currently being manipulated by the Federal Reserve’s fiat purchasing of T-bonds, watching the Dollar index in comparison with gold can give a good indication of when the final drop will occur. Over the past decade, the dollar has lost around 40% of its value, while gold has increased 400% in value. Gold’s increase is due in very large part to the devaluation of the Greenback, but it also indicates a surging international interest in precious metals, especially in Asia. Traditionally, when the dollar decreases in value, gold moves up, and when the dollar increases in value, gold falls. However, over the past four months, there have been sporadic incidences in which gold’s price has increased even though the dollar gained in value. These incidences have lasted only a day or two at a time, but they show that gold is starting to move on its own accord, slowly decoupling from the dollar and even being used as a competing form of currency in some places.

The Vietnamese Government, for instance, recently threatened to shut down all gold bullion trade in the country by the end of March, because Vietnamese merchants and consumers are abandoning their own inflated currency and using gold instead. The Vietnamese have also stopped using American dollars, once considered a safe store of value:

http://www.google.com/hostednews/afp/article/ALeqM5i2CFXWwN6o8w7nn9GqYjOZ2dHNwA

Banking elites in Western nations have been short selling gold for decades in order to keep the price down, and obstruct gold from becoming a competing alternative to the Dollar. Now, we are beginning to see gold move despite banker manipulation. Just before the onset of a dollar implosion, one should watch for gold to begin jumping steeply higher regardless of the behavior of currency markets. Any reports that blocs of foreign nations are increasing the exchange of U.S. Treasuries (beyond what they have done already) and buying large stores of gold would also signal a dollar collapse. In the event that average Americans begin considering the use of gold and silver in place of the dollar, as in Vietnam, you know the final downturn has begun.

Price Inflation Of Oil

For a long time, oil has been traded on the world markets exclusively in U.S. Dollars. Oil and the dollar are therefore intimately connected. Oil will be the first commodity to reveal any inflation (or hyperinflation) in the dollar during a breakdown. Currently, oil is steadily gaining, now hovering around $80 a barrel, or nearly $3 a gallon. Some in the MSM claim this is due to harsh winter conditions around the world, while others say it is due to the weakness and distrust in the Greenback. Not too long ago, oil prices were manipulated upwards by speculators to the tune of $150 a barrel:

http://money.cnn.com/2008/07/24/markets/cftc/index.htm

I suspect that this manipulation was not just an act of greed, but part of a larger strategy by the financial elite to acclimate Americans to the idea of gas price inflation, so that when it occurs again Americans will not be as quick to react, once again blaming speculators, instead of the real cause; a dollar implosion.

Another oil price increase anywhere near the $150 mark is an implicit warning that the economy is about to falter, especially if that increase continues on through summer months.

Dollar Loses World Reserve Currency Status

An announcement by any foreign nation, especially those that hold large stores of U.S. debt, that they will be dropping the dollar and trading in a different currency is a tremendous warning. The dollar is a very weak currency. It’s only saving grace, the thread it hangs by, is the fact that it still has world reserve status, meaning, it is a trade currency accepted by all nations. If BRIC nations, or OPEC oil producers, were to announce that they will no longer trade goods using dollars, expect an immediate tanking of our currency, along with treasury markets. Those that catch this news as it starts will probably have a month or maybe two to get all their preparations in order and distance themselves from any potential danger areas. Hyperinflation has the distinct ability to bring out the worst in a society. People can handle a Dow collapse, or even deflation, but when a currency is destroyed, all possible means of self support are lost unless one was prepared. Those who are not will lose the whole of their life savings in one fell swoop.

U.S. Treasury Dump

This is a little more difficult to track, simply because most foreign creditors do not want to announce openly that they are dumping their U.S. Treasuries. Such incidences can cause war, among other things. What can be tracked easily is the amount of treasuries being sold to other countries. Currently, other nations have nearly frozen their investment in our debt:

http://market-ticker.denninger.net/archives/1730-TIC-Data-Confirms-Foreign-Appetite-Gone.html

The U.S. deficit for the fiscal year 2009 came in at a record $1.42 trillion, more than triple the record set in 2008. The total national debt (according to the government) is now at a whopping $12 trillion and climbing! This debt cannot be sustained without a constant flow of money from other countries. If these countries stop purchasing our debt, then our Treasury will become insolvent. The country will be bankrupt. The Federal Reserve is currently trying to stave off this event by purchasing U.S. debt; basically legalized currency manipulation, much like paying off one credit card bill with yet another credit card. According to reports, the Fed now accounts for 91% of all U.S. debt purchases. This is a very bad sign:

http://www.zerohedge.com/article/ultimate-shell-game-federal-reserve-funds-us-deficit

Eventually, we will hear reports that foreign holders of treasury debt have not only stopped buying new treasuries, but are also dumping the treasuries they already have because of the Fed’s extreme devaluation policies. If this happens on a large scale, a collapse is about to take place.

Simultaneous Dow / Dollar Drop

Normally, when the Dow loses value and investors pull their savings out of stocks, they tend to put those savings into dollar backed securities or treasuries as a “safe haven”. This causes the value of the dollar to increase whenever the Dow falls, but the balancing act is beginning to change. One clear indication of a collapse would be the simultaneous fall of the Dow and the Dollar over a moderate period. This would denote a loss of safe haven status in the dollar as well as uncertainty among investors in stocks. A double whammy like this could prove to be an alert of impending disintegration.

A good time to watch for this signal would be around June or July, when it is rumored the Fed will begin raising interest rates from near zero.

Jobs And Housing

As we predicted recently, job loss which was hidden by the Labor Department in November is now beginning to show in December. We expect that job loss numbers will begin to grow more aggressive from this point on, as companies that hired temporary workers for the Christmas season proceed with layoffs in February and March.

Real unemployment, counting the U-6 measurement, is around 20%. When this measurement reaches between 25% and 30% (Great Depression levels), the country may be on the edge of final collapse.

Also, watching the small and medium sized business sector will help in discovering when job markets will completely tank. Small and medium businesses support around two thirds of all U.S. jobs, but these companies are now in dire straights:

http://www.cnbc.com/id/34825943

http://finance.yahoo.com/news/Job-o...l?x=0&sec=topStories&pos=8&asset=&ccode=

Most of these firms say they will be cutting even more jobs in 2010, not hiring.

Another important factor is the housing market and what are called “Option ARM Mortgages.” ARM mortgages are basically what created the housing bubble in the first place, by offering loans at artificially low interest rates which then increase after a set time period. Millions of people have home payments based on ARM mortgages, and many of these contracts are about to expire, meaning their payments will mushroom, and they will go bankrupt. California alone has hundreds of thousands of homes with ARM mortgages ready to expire in the next year:

http://www.cnbc.com/id/34729005

Watch closely for announcements of mass ARM mortgage resets, which could herald even greater losses in housing, as well as an increase in the homeless population.

Grocery Store Peculiarities

Wholesale prices of goods have recently been increasing far beyond what mainstream economists had predicted, hinting at the first steps towards inflation:

http://finance.yahoo.com/news/Spike-in-wholesale-inflation-apf-2682030532.html?x=0

Grocery store chains tend to “absorb” the extra cost of their stock in the hope that wholesale prices will soon drop again, and in order to keep from losing customers due to high prices, but this has the added effect of hiding true inflation from the public. Eventually, stores and manufacturers can no longer absorb the inflation, and either raise their prices, or diminish their volume. Keep careful note of your local grocery stores. Are items being “repackaged” by manufacturers to hold less for the same price? Is your $4, twenty ounce box of cereal now $4.50 and only fifteen ounces? Are items beginning to disappear entirely from the stores stock, especially foreign made goods? Are base goods such as rice or bread increasing in price weekly or bi-weekly? This may be due to an explosion in wholesale inflation, as well as financial weakness in the general economy.

Bank Holiday

A bank holiday is essentially the government closure of all banks and financial instruments dealing with banks for a set period of time. This means you will not be able to pull money from your account, you will not be able to make deposits, and you will not be able to use checks or debit cards, or even use an ATM. If you have no cash (or other valuables) on hand, you are in big trouble. A bank holiday is often announced in response to out of control bank closures, and is supposed to give banks time to shore up funds, as well as keep you from pulling all your money out at once. A bank holiday could also occur in the event that the FDIC is about to crumble, which is very likely. The FDIC is already broke, and is drawing on fiat currency from the Fed and the Treasury in order to continue covering the accounts of shut down banks. Over 140 banks closed last year. If this rate continues, or expands this year, then the FDIC will no longer be able to operate. If a bank holiday is announced, an announcement of Treasury insolvency is also likely.

Terror Attack / New War

The world is on the brink as it is. If a terrorist attack (false flag attack), or a new war arises, it is time to collect your gear, your family, your friends, and make for the hills (if that’s where you plan to go). Any new and extended threat of conflict in 2010 will be used as an excuse to institute martial law and subjugation of civil liberties, not to mention trigger a financial meltdown. Is the morning news reporting an attack on Iran, or the bombing of a New York subway? It’s time.

These events and triggers represent a “litmus test” for the economy that anyone can apply without spending every day in front of a computer screen tracking stock yields, hedge funds, or Federal Reserve press releases. Many people have already made extensive preparations, knowing that a breakdown is imminent, but with a little extra knowledge and effort, their edge on the collapse can be made ever sharper. No amount of preparation will stave off the psychological shock of sudden economic implosion if one does not keep alert to the prerequisite signs. Watching the simple indicators listed above can help in affording you every opportunity, giving you the ability to see the wreck before it even happens.

I read zerohedge.com most every day, Tyler Durden has been pretty spot on in his assessment of the market, and has been warning of the financial bubble/ponzi scheme set in place by the FED, and in particular Bernancke's mismanaged fiscal policies. Of course I would say he is nothing more than a puppet for big Banking/financing anyway.

The city walls of Dodge are crumbling as we speak, and we urge you to get out before they flatten you.

http://theautomaticearth.blogspot.com/2010/06/june-24-2010-magic-yellow-brick-wall.html


Ilargi: It makes no difference whether the stock markets go up or down or sideways anymore, except for those actively playing them. The demise of the American economy continues unabated regardless. Here's the real economy for you:

Unemployment: Outlook Grim For Jobs Bill Ahead Of Vote

Democratic leaders in the Senate have apparently failed to win enough support to overcome a Republican filibuster of a bill to help the poor, the old and the jobless, despite making a series of cuts to the measure over the past several weeks to appease deficit hawks [..]

The legislation, known as the "tax extenders" bill, would reauthorize extended unemployment benefits for people out of work for six months or longer, would protect doctors from a 21% pay cut for seeing Medicare patients, and would provide billions in aid to state Medicaid programs. Come Friday, 1.2 million people will lose access to the extended unemployment benefits, a number that will grow by several hundred thousand every week after that. Fifty million Medicare claims from June are currently in process at the reduced rate, which the AARP says has already caused some of its members to have trouble finding a doctor.[..]

That is the most accurate portrait of the real America you will find. The country is deliberately creating un underclass below its underclass. And that will have severe consequences.

Initial jobless claims fall 19,000 to 457,000, total beneficiaries rise 155,000 to 9.7 million

First-time applications for state unemployment benefits fell by 19,000 last week to a seasonally adjusted 457,000, the lowest in six weeks, the Labor Department reported Thursday, confirming that U.S. labor markets remain weak. [..]... the total number of people collecting unemployment benefits of any kind rose by 155,000 to 9.66 million in the week ending June 5 from 9.51 million.

In other words, all the White House job-creating plans continue to fail, initial claims go up or down a few thousand margin-of-error jobs each time we look, but if this were a recovery, they'd be nowhere near 450,000. Moreover, total benefits paid out keep rising, while the total number of people falling off the back of train, who no longer get a penny, rises more than we care to look at. Hundreds of thousands of additional Americans will be added to that category every single week from now on in. This is a recipe for disaster, not just for them, but for society as a whole. You can't have a successful society where people are starving by the side of the road.

The link between unemployment and real estate is undoubtedly clear for all of you who are regulars at this joint. You should therefore not be surprised to see numbers like these:

New-home sales plunge 33% to record low in May

Sales of new single-family homes plunged 33% in May to a record-low level after a federal subsidy for home buyers expired, according to data released Wednesday by the Commerce Department. Sales dropped to a seasonally adjusted annual rate of 300,000, the lowest since records began in 1963. April's sales pace was revised down to 446,000 compared with the 504,000 originally reported. March's sales were also revised lower.

Still, new homes are a tiny part of the market. Existing homes are what counts. Well, they are down too:

Existing-home sales dip 2.2% in May

Resales of U.S. homes and condominiums fell 2.2% to a seasonally adjusted annual rate of 5.66 million in May despite the boost from a federal tax credit for home buyers, according to National Association of Realtors data released Tuesday.

Please note that these sales are falling while there's still a tax credit in place. Which is about to run out.

And sure, it may be extended another time. Or it may not. The same goes for the extended emergency unemployment benefits mentioned earlier. But so what? It’ll have to stop sometime, and as long as the real economy keeps sinking the way it does, there’ll neither be anywhere near enough jobs to either satisfy the demand for them, nor to keep desperate owners in their homes. Which will in turn further depress home prices, which in turn will cost more jobs. There is no way out anymore.

And while this is going on, the logical outcome is that state governments are pathetic participants in the squeeze and be squeezed game. TIME Magazine of all sources has this:

Inside the Dire Financial State of the States

Twenty-two states have instituted unpaid furloughs. At least 28 states have ordered across-the-board budget cuts, with many of them adding deeper cuts in targeted agencies. And massive shortfalls in public pension plans loom as well. Almost no one — and no place — is exempt. Nearly everywhere, tax revenue plummeted as property values tanked, incomes dwindled and consumers stopped shopping. Falling prices for stocks and real estate have made mincemeat of often underfunded public pension plans. Unemployed workers have swelled the demand for welfare and Medicaid services. Governments that were frugal in the past are just squeaking by. Governments that were lavish in the good times, building their budgets on optimism and best-case scenarios, now risk being wrecked like a shantytown in an earthquake.[..]

Many taxpayers might say that it's about time spending dropped. But then they start hearing the specifics. Government budgets contain a lot of fixed costs and herds of sacred cows. K-12 education absorbs nearly a third of all spending from state general funds. Add medical expenses, primarily Medicaid, and it's over half. Prisons must be maintained, colleges and universities kept open, interest on bonds and other loans paid. Real cuts provoke loud howls, and you can hear them rising in every corner of the country. College students have marched in California, firefighters have protested in Florida, and on June 10, Minnesota saw the largest one-day strike of nurses — some 12,000 — in U.S. history.

And don't count on the shaky economic recovery for relief. After plunging in 2009, tax receipts are stabilizing in many places — but the next big shoe is fixing to drop. Having poured billions of dollars into state coffers through the stimulus act of 2009, the federal government is poised to close the tap. President Obama made an unusual Saturday night request to Congress last week for $50 billion in emergency aid to the states to stave off layoffs of teachers, firefighters and police. [..]

On the grand scale, this fiscal fiasco is playing out in California and New York. Both states boast economies far larger than that of Greece, which so disturbed the world economy this spring. And both are paralyzed by structural deficits far larger than their politicians seem able to grasp. The impasse in California between Republican governor Arnold Schwarzenegger and the Democrats controlling the legislature appears set in concrete. Last year, the Golden State was reduced to issuing IOUs; this year's budget, some $19 billion in the hole, is once again a shambles. In New York, Democrats control all the levers, but they can't find a cost-cutting deal acceptable to the public-employee unions that helped elect them. The deficit in Albany is $9.2 billion.

[..] .... a majority of states will have reserves well below safe levels recommended by the National Association of State Budget Officers. Leery of broad tax hikes in a bad economy, governments have instead chosen to shake the sofa cushions and punish the naughty, closing loopholes, cracking down on tax evaders and raising levies on tobacco, alcohol, gambling, soda pop and candy — even bottled water in Washington State. Nearly half the states have hiked fees for higher education, court services, park access, business licenses — or all of the above.

These are the tried-and-true responses to dips in the business cycle, but as the woes drag on from year to year, the job of closing budget gaps grows more difficult. Now larger issues and harder choices are being laid bare, beginning with the sprawling mess that is Medicaid. Created by Congress, administered by the states and paid for by a patchwork of federal, state and local governments, the health care system for America's poor is a jumble in the best of times. With enrollments growing rapidly, that jumble is becoming a train wreck.

What's going to give? Prepare for a free-for-all. The states are pressing Washington to maintain the emergency Medicaid supplement that was part of the stimulus package. So far, congressional moderates are blanching at the price tag. If the Beltway budget hawks win that battle, states plan to squeeze the patients, who are currently protected by strings attached to the stimulus money. No federal supplement means no more strings. Already various states are contemplating tighter eligibility rules, lower benefits, higher co-pays and other restrictions. And then there's the ongoing fight between the states and the medical system. Governments are wringing money from doctors and hospitals coming and going: first they are cutting payments for Medicaid services, and then they are raising fees on Medicaid providers.

Really, do you need it any clearer than that? Do you now still think you and yours will be spared? There is no magical way out. Your federal, state and municipal governments will start taxing you ever more, trying to save their own jobs and asses, at the very moment that your incomes will begin to decline.

Paul Krugman and his Keynesian "Spend, spend, spend" ideas and followers, like Obama and his buddies Larry Summers and Tim Geithner and the rest of Washington base their notions and measures on one grand idea: that the economy will start growing again, and strong, and soon.

But the economy isn't growing, and if they wouldn't have thrown your grandchildren's tax revenues at the magic yellow brick wall, this would be evident to everyone today. All they have achieved, apart from a prolongation of their own careers in power, is that it will be even more, and far more brutally, evident in the future.

It’s about to blow up in your face, guys, literally, the whole thing, your entire lives. And it really doesn’t matter whether it does so in two weeks or two months or two years, does it? If it would take two years, you'd just get sucked even deeper into the hologram.

What matters is that everyone begins to understand that this thing is inevitable, and that the consequences will be beyond anything you've ever known.

The city walls of Dodge are crumbling as we speak, and we urge you to get out before they flatten you.

No Jobs


The Economic Collapse
June 6, 2010

Everyone knows that the United States is bleeding jobs. According to one new study, the private sector in the United States has lost 10.5 million jobs since 2007. The U.S. economy lost 125,000 more jobs during the month of June. Approximately a million frustrated American workers have simply dropped out of the employment market altogether over the past two months. But the question not enough people are asking is why so many jobs are being lost. Yes, the large global corporations have been sending millions of jobs overseas where labor is far, far cheaper. And yes, the U.S. government has accumulated so much debt that it is absolutely suffocating the U.S. economy. But there is another very important factor that has been largely overlooked. Traditionally, about 75 percent of all new jobs are created by small businesses. But today, hundreds of thousands of small businesses are being strangled out of existence by all of the oppressive taxes, fees, rules, regulations, paperwork and demands that government keeps imposing on them. In such a repressive environment, it is getting close to impossible for small businesses to thrive, and if our small businesses can’t succeed, then we simply are not going to see a lot of jobs being created.

You see, the truth is that over the past several decades the game has become dramatically stacked in favor of large businesses. Big corporations have the money to lobby Congress and other governmental institutions, they get almost all the tax breaks and they are the only ones who get bailouts. They even “help” write legislation on the federal level.

Many times large corporations will even lobby for more regulations for their own industry because they know that they can handle all of the rules and paperwork far easier than their smaller competitors can. After all, a large corporation with an accounting department can easily handle filling out a few thousand more forms, but for a small business with only a handful of employees that kind of paperwork is a major logistical nightmare.

When it comes to hiring new employees, the federal government has made the process so complicated and so expensive for small businesses that it is hardly worth it anymore. Things have gotten so bad that more small businesses than ever are only hiring part-time workers or independent contractors.

So what we actually have now is a situation where small businesses have lots of incentives not to hire more workers, and if they really do need some extra help the rules make it much more profitable to do whatever you can to keep from bringing people on as full-time employees.

In a recent article for the Las Vegas Review-Journal, Wayne Allyn Root described what he is hearing from his friends who are small business owners….

I’ve polled all my friends who own small businesses — many of them in the Internet and high-tech fields. They all agree that in this new Obama world of high business taxes, income taxes, payroll taxes, capital gains taxes, and workers compensation taxes, the key to success is to avoid employees. The only way to survive as a business owner today is by keeping the payroll very low and by hiring only independent contractors or part-time employees provided by temp agencies.

Can the U.S. economy thrive in such an environment?

Of course not.

Small businesses are slowly being strangled out of existence.

Unless something changes quickly, small businesses are going to continue looking for ways to shed employees rather than hire them.

In the article referenced above, Wayne Allyn Root explained why this is true….

My small business-owning friends aren’t creating one job. Not one. They are shedding jobs. They are learning to do more with fewer employees. They are creating high-tech businesses that don’t need employees. And many business owners are making plans to leave the country. In a high-tech world where businesses can be run from anywhere, Obama has a problem. His one-trick pony — raise taxes, raise taxes, raising taxes — is chasing away the business owners he desperately needs to pay his bills.

The U.S. government has become like the 500 pound fat guy who jumps on a horse and then gets angry when it won’t move.

Passing even more ridiculous regulations and raising taxes even higher is not going to fix business in America.

The burdens we have placed on our small businesses have gotten worse under every single presidential administration of the past several decades. Now our great economic machine has become so overburdened and so tired that it is simply refusing to move.

And this is not a short-term problem either. Yes, we have lost a ton of jobs since the beginning of the “Great Recession”, but our problems go back a lot farther than that. The reality is that the U.S. population has grown by about 25 million people since they year 2000, and we needed to create millions upon millions of new jobs to support that increased population. Instead, we have lost a total of 3 million jobs since 2000.

Needless to say, that is not a good trend.

There are simply not enough jobs for everyone.

Today, there are more than 5 unemployed Americans for every single job opening.

It is becoming harder and harder to find a job, and the number of Americans who are chronically unemployed is absolutely exploding.

In America today, the average time needed to find a job has risen to a record 35.2 weeks.

There are millions of Americans out there tonight who feel like punching the walls or drinking themselves under the table out of frustration because they can’t find a job.

And many of those who are “chronically unemployed” are about to experience even more pain.

So far, the U.S. Senate has refused to extend long-term unemployment benefits for about 1.3 million Americans. Without this assistance, these Americans and their families will be forced to survive on food stamps and whatever else they can scrape together.

The tent cities that are popping up all over the United States are about to get a lot more crowded.

So is there much hope that this is going to turn around any time soon?

Unfortunately, no.

Big corporations are not going to pay U.S. workers ten times more money than what they are paying employees in Malaysia, China or the Philippines just because they feel sorry for them.

Small businesses are not going to hire a lot more workers as long as things stay the way that they are. In fact, many small businesses are going to continue to look for ways to cut employees.

The public sector is the one place that had been hiring more workers, but due to growing concern about exploding budget deficits, there isn’t going to be a lot of additional hiring in the public sector either.

The truth is that there is not a lot of reason for optimism right now. The U.S. economy is being battered by a host of economic problems, and with each passing week even more economists warn that we are likely headed for the second half of a double-dip recession.

So if you still have a job, be thankful. If you don’t have a job, you are probably going to have to get really creative.

Times are tough and they are going to get even tougher. But it is in the midst of challenging times that we find out who we really are.

Empty Store Shelves Coming to America


National Inflation Association
July 14, 2010

The National Inflation Association today issued a warning to all Americans that empty store shelves will likely be coming to America as a result of government price controls during the upcoming hyperinflationary crisis. This morning, NIA released a video preview of what hyperinflation will look like in the U.S. This extremely important must see video is now available on NIA’s video page.

NIA’s six-minute video released today goes into detail about an event that took place just outside of Boston, Massachusetts in May of this year. This story was widely ignored by the nationwide mainstream media, but NIA believes it was one of the most important news events of the first half of 2010. Although this particular crisis in Boston was due to decaying infrastructure, NIA believes a currency crisis will lead to the same type of panic on a nationwide basis.

NIA hopes that this video serves as a wake-up call for Americans to take the necessary steps to prepare for hyperinflation and become educated about the U.S. economy. In Zimbabwe during hyperinflation, Zimbabweans were forced to transact in gold and silver. It’s only a matter of time before the U.S. dollar becomes worthless and the only Americans with wealth will be those who own gold and silver.


Citizens of Boston were able to survive their recent crisis with the help of the National Guard, but the National Guard won’t be there for Americans during hyperinflation. 40.2 million Americans are currently living off of food stamps, but food stamps won’t have any purchasing power during hyperinflation. The United States’ day of reckoning is ahead. We cannot go on living with record budget deficits and accelerating national debt growth forever.

Just yesterday it was announced that for the first time ever, a major credit ratings agency has given China a higher credit rating than the U.S. While most credit ratings agencies including Moody’s, Standard & Poor’s and Fitch Ratings still rate U.S. debt as AAA, NIA believes the real credit rating of the U.S. should be junk. The only way one could possibly justify a U.S. credit rating of AAA is by taking into account the Federal Reserve’s ability to monetize our debt through inflation. However, printing money to pay off debt is a lot worse than defaulting on it. Inflation is very deceptive, it destroys the value of savings while transferring wealth from the poor and middle class to the rich.

The U.S. has a budget deficit just from Social Security, Medicare and Medicaid alone. NIA urges President Obama to implement dramatic cuts to these entitlement programs immediately, while simultaneously reducing the size of government across the board. Time is growing short for Obama to rein in government spending. The longer Obama waits to reverse course, the harder it will be for the U.S. to recover from the calamity that is about to unfold.

Please forward this message to everybody you know. It is essential to the well-being of all your family members and friends that they watch our new video entitled “Empty Store Shelves Coming to America” by going to: http://inflation.us/videos.html

Here's the direct link to the "Empty Store Shelves" video: http://www.youtube.com/watch?v=BIVVL43qPXY

I am going out on a limb with this one, although history will back me up:

For the last ten years, I have heard threats of hyperinflation from those I respect, including Ron Paul. True, Helicopter Ben Bernanke is also pro-inflation, but why has it not occurred yet?

Three reasons:

First, the ability to control the markets has improved exponentially since electronic transactions are the order of the day. This level of micro-control permits the banking oligarchy to literally produce money in real-time, and thus creates the illusion of stability. "Money" can be instantly shifted and allocated before any repercussions.

Second, even with all the hype, silver and gold have been sufficiently marginalized to the point that they are not valid currencies, combined with the fact that upwards of 90% of all financial transactions are conducted electronically, which is steadily eliminating cash. The full transition to an electronic currency will come long before any price inflation is realized. To those outside the FRN system, inflation is the least of our concerns. This is survival mode.

Thirdly, instead of printing more money for the masses, electrons will instead be transferred to the military contractors and .gov operatives who will greatly benefit from the impending World War.
Historically, war serves as the best distraction from economic calamity, while at the same time physically removing the strongest and bravest men to a foreign battlefield. "Over There," is not just a song from WW1, it is the tyrants' perennial solution for dealing with the threat of domestic unrest.

Don't worry about hyper-inflation. Just focus on survival preps.

Even so, come Lord Jesus.

The Case for Hoarding from (where else?) the Mises Institute.

Onward and upward,
airforce

Economic Meltdown: The Final Phase


By Giordano Bruno

Neithercorp Press - 07/18/2010


In the financial life of every culture built upon faulty monetary policy, there are points at which the thin thread of economic faith; the thread that ties the entire failing system together, the thread made tangible by the hopes (and sometimes ignorance) of the general populace, finally snaps. From Ancient Rome, to Weimar Germany, to Argentina, to modern day America, no society fueled by unsustainable debt and fiat inflation can duck the ‘Fiscal Reaper’ for very long. The U.S. alone has survived since the early 1970’s (after Nixon removed the last vestiges of the gold standard) on nothing but questionable credit practices and baseless optimism, but there is a limit to the power of fantasy. This is a fact that most mainstream financial analysts and some in the American public refuse to grasp. Mere belief in the enduring nature of the marketplace is not enough; the fundamentals must also support that belief.

Today, we face an atmosphere in which the fundamentals are fiercely opposed to the publicly promoted perception of the economy, and it is moments in history like this that present a clear primer for total collapse. Financial disaster is bad enough when it is at least partially anticipated. When the masses are caught completely unaware and unprepared in the midst of misguided conviction, this leads to the worst kind of tragedy: the ironic and Shakespearian kind. To avoid this brand of tragedy is one of the primary reasons why we in the Liberty Movement do what we do. We may not be able to stop the current crisis from developing, but we can create awareness, and through this we can lessen the cultural shock, and thereby lessen the impact.

Mainstream economists crowed about the “invincible” rise of globalism and the unstoppable U.S. financial juggernaut for years while more level headed and intelligent men tried to warn the public of danger. The initial derivatives collapse in 2007 / 2008 should have put all of these pathetic establishment cheerleaders to shame, not to mention out of work. Yet three years later, amazingly, we are asked, even expected, to continue to look to such sad and useless people for predictions on market stability that always turn out absolutely inaccurate, and advice on savings and investment that they are not equipped to give.

I suppose we should not be surprised by the continued lifespan of MSM parrots and puppets. They may not be helpful to the average American, but they are very helpful to international banks and the globalist companies that pay their salaries. They distract and confuse us. They comfort when they should caution, and contradict when they should pay heed. Our financial house is burning from the bottom floor up, and they assure us that the warm orange glow is just the dawning of a new and beautiful day. We are told to “look to the future”, a return to normalcy is “just around the corner”. Never would they dare to weigh the cold hard factors of the present, or the ruse would be up. Whether they are aware of it or not the lies media pundits perpetuate set the stage for even greater upheaval, to the detriment of most, and the benefit of only a handful.

In this article, as we have in so many others, we will examine those lies, as well as the truths they are meant to hide. The most important truth of all being, that not only are we not in the middle of a recovery, but that the final phase of the economic meltdown is about to commence…

Distractions, Half-Truths, And Outright Lies

“We will not have any more crashes in our time.”
- John Maynard Keynes in 1927

“I see nothing in the present situation that is either menacing or warrants pessimism… I have every confidence that there will be a revival of activity in the spring, and that during this coming year the country will make steady progress.”
- Andrew W. Mellon, U.S. Secretary of the Treasury December 31, 1929

“[1930 will be] a splendid employment year.”
- U.S. Dept. of Labor, New Year’s Forecast, December 1929

“While the crash only took place six months ago, I am convinced we have now passed through the worst — and with continued unity of effort we shall rapidly recover. There has been no significant bank or industrial failure. That danger, too, is safely behind us.”
- Herbert Hoover, President of the United States, May 1, 1930


Most of us were not alive to witness the throws of the Great Depression, but for many, the quotes above sound strangely familiar. Pundits and government officials of our fateful era have taken to spewing the same kind of nonsense on a daily basis, and one begins to wonder if they are TRYING to top the ridiculous statements of their forebears in an attempt of ultimate mockery. Today, not only are we told that “green shoots” abound, but that if those green shoots fail, it will only be because we did not “believe” hard enough in their existence!

http://www.telegraph.co.uk/finance/...n-Only-if-we-talk-ourselves-into-it.html

It is this kind of idiocy that led us to the state of affairs we are in now, and it is the same idiocy that will leave millions of Americans in extended financial ruin in the near future. The absurd idea that prosperity is driven merely by blind optimism must be put to rest if we are ever to rebuild. Transparency, the pure and unadulterated truth, must be present in every aspect of government and finance without question for a culture to succeed. No longer can we operate in a system built upon the premise that the American people must be kept in the dark “for their own good”.

The essence of the recovery argument lay in unsubstantiated rhetoric, skewed statistics, and the over-promotion of news items that in reality are very minor economic indicators. Wall street reform has been heralded as a fix-all, yet the language of the legislation does little to nothing in reigning in the toxic derivatives trading practices that fomented the housing bubble, nor does it take any measures against the root cause of the mortgage crisis; the private Federal Reserve Bank, which artificially lowered interest rates and lending standards during the 1990’s knowing full well that this would amass pockets of poisonous debt securities throughout the economy. International banks have not been truly punished for their practices of market rigging and faulty accounting, nor will they be. The recent and laughable lawsuit settlements of AIG and Goldman Sachs prove that no bankers will be held accountable, only penalized with fines that amount to little more than pocket change to these monstrous global corporations:

http://www.sec.gov/news/press/2010/2010-123.htm

http://www.cbsnews.com/stories/2010/07/16/ap/business/main6685538.shtml

This means that the conditions which triggered the initial collapse have not been mended in any way. Absolutely nothing has changed since 2007. Americans have only been temporarily shielded from the effects and the particulars of continuing financial corruption. For instance, it has been revealed that the SEC itself has known since at least April that Citigroup has been hiding assets and debts on its books by counting Repurchase Agreements as actual sales. For those of you not familiar with such slight-of-hand, this is the same kind of accounting trick that led to the fall of Lehman Brothers:

http://www.reuters.com/article/idUSTRE66F0NV20100716

Citigroup claims, of course, that these Repurchase Agreements are only a small part of their operation and will not affect their ability to function. The problem is that like Lehman Brothers and Citigroup, it is probable that most global banks have used false accounting procedures to hide the true measure of their leveraged capital. It certainly is not in their best interest to reveal the whole truth, so why would they? Due to the continuing dilemma of hidden and unreported bank debts, it is only a matter of time before we witness yet another credit implosion, followed by even more taxpayer funded bailouts, and even greater stress on the stability of the U.S. Dollar.

While empty promises of reform and the hidden accounting practices of banks have kept markets malleable for the moment, it is really the exaggeration of consumer spending and retail gains, along with rigged unemployment reports from the Labor Department, that have kept the false recovery wheel spinning for over a year. Any profit or production increase by almost any company has been held up as a rallying cry for a bull market, even though in most cases these companies increased profits by cutting their labor force, and increased production by forcing their remaining employees to work harder for the same amount of money. They did not expand profits because the U.S. consumer is spending once again with wild abandon as has been suggested every time new quarterly profit reports are released. After a year of this misrepresentation of the facts, finally, the truth is starting to come out.

Retail stocks are beginning to shed value as they take hits from decreasing sales and profits, meaning, the cost cutting strategy has run its course and retailers are still losing money:

http://www.bloomberg.com/news/2010-07-14/sales-at-u-s-retailers-fell-for-a-second-month-in-june.html

http://finance.yahoo.com/news/Dim-r...l?x=0&sec=topStories&pos=9&asset=&ccode=

Service sector employment has remained stagnant. The excitable talk that started at the beginning of this year of a hiring resurgence has now faded:

http://www.reuters.com/article/idUSTRE65M2WK20100706

The bottom line; the TRUE unemployment rate of around 20% has become perpetual, and some economists are even suggesting that we accept it as a standard. The American public is now coming to realize that healthy job creation is a very distant goal, one that the government alone has no ability to achieve, bailout or no bailout:

http://www.bloomberg.com/news/2010-...employment-as-budget-deficit-widens.html

On the international scene, news from Europe has gone abruptly quiet. After months of blaring reports on the Greek sovereign debt crisis, and the imploding Euro, suddenly, we are told that the situation is stabilized? But how? What measures were taken and how did they affect a balancing of the EU economy? The fact is, no measures have been taken. No effective adjustments have been made. The MSM has only muted the reports, and for many Americans, out-of-sight truly is out-of-mind.

Greece is still right where it was six months ago, and the debt to GDP ratios of EU member countries continue to rise.

The mere mention that Spain’s Aaa credit rating was coming under review for a possible downgrade jolted stocks at the beginning of July. The review is not set to conclude for three months, but the market reaction shows that some of the larger investment firms are keenly aware of the weakness in Spain, and the chance that it will become the next in a long line of Greek style implosions:

http://www.businessweek.com/news/20...eview-at-moody-s-as-note-sale-nears.html

Portugal’s credit rating was downgraded by Fitch in March, and now it has been downgraded by Moody’s as well:

http://www.huffingtonpost.com/2010/07/13/portugals-credit-rating-d_n_644093.html

And, the IMF and the EU have suspended a review of Hungary’s funding program while the country is in the midst of meltdown. This means Hungary will no longer have access to the $25.1 billion loan package made available by the IMF to see them through the crisis. Frankly, I think all countries are much better off not taking money from the demon spawn over at the IMF, but many of the citizens of Hungary may not see it that way. The suspension of the loan package almost ensures a national default:

http://www.reuters.com/article/idUSTRE66G0RT20100717

Most European countries are in the same predicament as Greece to varying degrees, Greece just happened to be the first to fall. The combined weight of sovereign debts in all EU countries is now threatening the very framework of the European Central Bank itself. The ECB is now facing higher interest rates, which means increased funding costs that they cannot afford without inflating the Euro:

http://www.bloomberg.com/news/2010-...-rates-as-debt-crisis-hurts-economy.html

What is this leading to? A situation we have been warning about for years; either the default of numerous EU member nations, or the inflationary collapse of the Euro. In each case, the EU will eventually be forced to turn towards the only avenue left available to them; the IMF and full austerity measures. This, of course, was the plan all along….

We have just covered the broader problems in the world economy that have been obscured by the establishment media in order to perpetuate a false sense of security in the masses. However, these are simply ongoing problems that some may dismiss as “par for the course”, troubles that could go on for years without causing immediate damage to America itself. Other recent events, though, now show that the likelihood of a final phase meltdown of the U.S. economy may begin before the end of this year.

The Signs Of Final Phase Collapse

It is difficult to write about economic indicators of collapse for many reasons, but the primary issue is one of relativity. Most Americans alive today have never suffered through an extended depression and few if any have ever witnessed a full fledged meltdown of a country’s finance and infrastructure. Therefore, many people in this country have no point of reference with which to compare and contrast the events of the new millennium. The unfortunate reality is, when a society enjoys an extended period of affluence, they often become conditioned to take prosperity for granted. They become unable or unwilling to interpret warning signs of a collapse until the event is already near its end, and they have lost everything.

The signals listed below I believe are truly the last straw, the final alarm before the global financial system spirals completely out of control. It is impossible to say exactly when this larger secondary breakdown will occur, however, when one studies the economic disasters of the past, these same primers tend to appear preceding very fast moving financial decay.

Secondary Real Estate Bubble: If you think you’ve seen a catastrophe in the real estate market so far, just wait another six months. Now that the government home buyer tax credit has ended, we are starting to see how much the real estate market really was being propped up by taxpayer dollars. Mortgage bond yields have plummeted to their lowest level on record while bond sales have slumped, all in anticipation of another massive round of mortgage defaults:

http://www.bloomberg.com/news/2010-...home-loan-rates-approach-record-low.html

http://www.bloomberg.com/news/2010-...h-09-on-default-risk-credit-markets.html

Sales of new U.S. homes have plunged to the lowest level on record:

http://www.bloomberg.com/news/2010-...es-plunge-to-lowest-level-on-record.html

And, nearly 1 in 3 homes sales in the first quarter of 2010 were foreclosures at rock bottom prices:

http://news.yahoo.com/s/nm/20100630/us_nm/us_usa_housing_foreclosures

Home foreclosures are on track to reach 1 Million or more by the end of 2010, and home seizures have risen 38% as banks process a backlog of mortgage defaults. This is despite efforts by banks to reduce foreclosure numbers by modifying loans and attempting short sales of properties:

http://news.yahoo.com/s/ap/20100715/ap_on_bi_ge/us_foreclosure_rates

http://www.bloomberg.com/news/2010-...as-banks-process-forclosure-backlog.html

This is nothing compared to the nightmare that is brewing in the commercial real estate market. Commercial real estate transactions have collapsed by 90% as many people are aware:

http://www.mybudget360.com/commeric...lout-4-times-size-of-credit-card-market/

However, most analysts tend to overlook retail land occupancy rates. Commercial property vacancies have hit a ten year high:

http://www.reuters.com/article/idUSN0610302020100707

In the past, owners of commercial real estate have enjoyed extra credit and loan extensions from banks because financiers hope that by supporting the commercial market through the downturn they might retrieve profits once the economic uncertainty has ended and businesses start making money again. But what happens when the downturn does not end? Banks are only going to extend loans for so long before they pull the plug, even on commercial borrowers. It would seem that the time has come for the commercial real estate bubble to finally burst.

Why are these recent problems in the real estate market an indicator of a final phase collapse in the near term? The issue is one of prolonged instability. The recession / depression that we face today should have transpired sometime in the early 1990’s, but the engineered low interest rates supplied by the private Federal Reserve during that decade created the property value boom. Any American could buy a home regardless of whether or not they could actually afford it, and anyone with a home could then use it as collateral for enormous credit lines. This new artificial debt bubble prolonged the collapse for around fifteen years. As of the second quarter of 2010, though, this credit source has been exhausted completely. There is officially nothing left to support the general economy (except, of course, fiat inflation). The effects of this lack of national capital should become very visible by the end of this year.

Unemployment Visibility: It did not come as a surprise to this researcher that the jobs market began to crumble once again in June and July, but it did come as a surprise to some. We’ve talked on numerous occasions about how the Labor Department hides the true level of unemployment from the public, and I won’t beat that poor dead horse any further. Suffice to say, real unemployment counting the U6 measurement is around 20%. The length of the average American’s unemployment has reached incredible levels. Many millions have remained jobless for 6 to 12 months. In response, the Federal Government has extended unemployment benefits several times over the past year. While this has been painted as a necessary action to save the livelihood of jobless citizens, it is less about “compassion” from the government and more about obscuring the effects of unemployment until they are ready to let the cradle fall. That time has come.

Congress has not renewed extensions of benefits as of this month, and it looks as though they do not plan to do so again. Barack Obama (or his handlers) have tried to turn this issue into another false left / right paradigm argument, claiming that it is the Republicans that are to blame for the loss of unemployment benefits. This is a distraction from the real matter at hand. The truth is, the ENTIRE government is responsible for the disruption of benefits due to the unchecked and insane deficit spending BOTH parties have enacted over the years. Extending benefits again would add billions if not trillions to the already unsustainable U.S. debt and cannot be continued indefinitely.

Unemployment benefits hide the visible scars of national job loss. Now that millions of Americans have run out, expect to see those scars in all their terrible glory. Expect homeless numbers to skyrocket. Expect crime to skyrocket. Expect suicides to skyrocket. Expect all the problems that were once muted and hidden to now parade across the street where you live. Expect things to deteriorate from the comparably nice, polite, and civil situation we have currently. Expect things to get ugly.

Municipal Debt Implosion: As we have been warning about for the past couple years, municipal bonds are in dire straights. Cities and some states are ready to implode and they are ready to implode now. Look for city defaults to rise to record levels in the next year.

California and Illinois are broke, make no mistake. When Arnold calls for state employee pay to be reduced to minimum wage and Illinois lets $5 Billion in bills go unpaid, there is no turning back:

http://www.bloomberg.com/news/2010-...inois-holds-bills-to-bar-downgrades.html

Municipal Bond Defaults now continue at triple the typical rate:

http://www.bloomberg.com/news/2010-...riple-the-typical-rate-lehmann-says.html

This not only sets the stage for statewide bankruptcies, it also threatens to bring down large holders of municipal securities, such as Citigroup and U.S. Bancorp:

http://www.bloomberg.com/news/2010-...muni-holdings-climb-to-25-year-high.html

Usually, muni-bonds are used by investors as a tax haven and hedge to weather credit storms like that which we are seeing now, yet, investors in the past few months have begun dumping their municipals like a bad date. I believe we will begin hearing about state defaults before the end of the year.

The Dollar? Stick A Fork In It, It’s Done: As we recently predicted, the dollar has broken its traditional relationship with the stock market. Usually, when investors pull their money out of stocks, they then place it in dollar based securities as a safe haven. This causes the dollar to increase in value. In the past few weeks, though, the dollar has plummeted at the same time as stocks! This means investors no longer trust the dollar as a safe haven investment during a market crisis. As we have said for years, when this signal happens, the dollar is ripe for meltdown.

Central banks across the world are beginning to abandon the U.S. dollar:

http://wallstreet.blogs.fortune.cnn.com/2010/07/09/central-banks-start-to-abandon-the-u-s-dollar/

Despite the uncertainty in Europe, the dollar has still sunk against the Euro faster than it has in the past year:

http://www.bloomberg.com/news/2010-...-euro-on-signs-of-economic-slowdown.html

In 2008, I predicted that China would radically re-engineer its economy, changing it from an export based hub to a self sustaining consumer hub. I predicted that they would depeg the Yuan from the Dollar after this move was done, and following that, they would dump their vast holdings of U.S. treasuries, causing the dollar to lose its world reserve status, destroying its value, and creating hyperinflation in prices here in the U.S. So far, the first two events have already occurred. China has depegged its currency from the dollar and is allowing it to begin appreciating. They have also almost finished converting their economy into a consumer system while continuing exports through the ASEAN trading bloc:

http://www.nytimes.com/2010/06/25/world/asia/25china.html?_r=1&ref=global-home

The Yuan is now being globalized by the Chinese in an effort to strengthen its base and make it viable as a reserve currency:

http://www.reuters.com/article/idUSTRE66427920100705

Some analysts have suggested that the globalization of the Yuan could take years, however, this is not necessarily so. If the U.S. dollar were to collapse, or the Euro, or both, the Yuan suddenly would look extremely viable as a reserve currency. I believe this is exactly what will happen, and, I believe China will begin depleting its U.S. Treasury holdings in the next 6 months.

Interestingly, some in China have gone out of their way to deny that such plans are in the wings, and the MSM has helped to facilitate this fallacy:

http://www.reuters.com/article/idUSTRE6660VC20100707

Set aside the fact that others in China are calling for the government to dump U.S. Treasuries:

http://www.reuters.com/article/idUSTRE66I05U20100719

Now would be the perfect time considering the dollar’s recent rise due to the problems in the EU. A bond dump at this time would mean China could reap maximum profits before a final monetary breakdown. China is reverting to a consumer hub and is no longer relying on exports to the U.S., so the idea that they have any reason whatsoever to continue holding onto U.S. Treasuries is absurd.

The final key to the coming Chinese treasury dump, I feel, is in the relationship between China and Germany. Germany is really the primary pillar of the EU, without it, the EU could not exist. A barely publicized visit by German Chancellor Angela Merkel on July 15th may be the final piece of a long escalating financial relationship between China and the stronger countries of the EU:

http://news.xinhuanet.com/english2010/china/2010-07/14/c_111953600.htm

A Chinese / German financial alliance could create a core economic “shell” which might withstand an anticipated disintegration in the U.S. and some of the more indebted European nations. I do not expect the dollar as we know it to survive past 2011.

The Line Has Been Crossed

I have never seen so many indicators of total meltdown, when compared to past economic collapses throughout history, as I see today. Not to sound melodramatic, but I’m really not certain if I will be writing these financial analysis articles for much longer. I suspect that before the year is out there will be no more need, being that every facet I have laid out over the years will become glaringly obvious to everyone.

As I have stated so many times, we may not be able to stop these events from unfolding, but we can determine their final outcome. Prepare for the worst, because I have no doubt you are liable to see it before the next few years are done. Stand by your principles. Never compromise your conscience. And above all else, survive. No ending culminates without the graces of a new life, one full of possibility. It is up to you, the staunch and independent American individual, to see that that possibility is realized regardless of any obstacle or enemy. A fiscal catastrophe will not stop us, it will not break our spirits, it will not enslave us. It will only strengthen our resolve to remain forever defiant, and forever free.


Special Note To Neithercorp.us Readers: For the past four weeks or more, our website neithercorp.us has come under heavy attack by hackers or agencies employing hackers. Due to the sophistication of these attacks, we are unable to properly secure the site at this time. In order to protect you, our readers, I will be posting my articles to this page until the problem can be resolved. I hope you will continue to follow our efforts here at blogspot while neithercorp.us is on hiatus. Thank you for your continued patronage. It will take more than web attacks to shut me up...

Good article, and well worth the read.

However, I still say that we will not see hyper-inflation in the U.S. any time soon.

In fact, now is a great time to stock up on commodities and foodstocks at rock bottom prices.

I tend to agree with you Imagrunt, maybe not "Hyperinflation", but as you suggest, many other Americans will start to heed your advise and begin to stock-up on commodities and foodstocks. This will bring about a form of hyperinflation, as a secondary effect. As the very exaustable supplies of commodities and foodstocks begin to run to short supplies, the prices will most certainly go up quickly, right to the point that people stop selling anything that is necessary to survival at any price.

Let's face it, this is the very "Trap" that government and corporate controlers has set for all Americans, this whole Nation. There is no other way to get Americans to drop the faith and hope in our Constitution and Bill of Rights,(Our American Freedoms), and embrace a most oppressive form of world communism while our Freedom still looks remotely workable.

The only defence to loosing our Freedom,(and the America that we have all known from history), and being thrust into this NWO is for Americans to "UnSelfishly" help other Americans by growing food, making those commodities, and trading on a "Survival-System" that simply keeps as many Americans alive and able to help in the same ways as was/is done for them.

It's crashing around us, slowly, as I write this. Far, far too many Americans are in a pure denile that it is happening at all.
But all it will take for absolutely every American,(and the rest of the world's population), to realize that it is truely crashing beyond any point known in American history, is for what I have described above to run short and not be sold at any price.

No American can Sell Survival for any Price, but for the Love of God, every American can Help others to survive and Teach it to their Fellow Americans... once they finally come looking for it, and are willing to learn how to actually "Survive in Freedom".


IMHO

Michael

A year ago I would have bet that we would be seeing at least some signs of inflation now. We aren't simply because there isn't a demand for anything right now (except for gold and ammunition, of course).

One way or another, that's going to change. The financial markets are, somehow, going to have to absorb $4 trillion in debt in just the next six months--while at the same time dealing with the crisis over the euro, and the continuing mess over Fannie Mae and Freddie Mac. It's not at all certain they can do it.

And Bernanke's options at the Fed are pretty limited. If he could lower interest rates below zero, I have little doubt he would have done so already. He has to keep the printing presses running. It's really the only option he has.

I'm buying a little silver, which is cheap in relation to the price of gold, but ammo is still my primary investment. I just don't see how bullets are going to get any cheaper.

Onward and upward,
airforce

When Will Financial Armageddon Begin?


By Greg Hunter

USAWatchdog.com

A little more than two years ago, economist John Williams of shadowstats.com predicted a “severe recession” was coming and soon. At the time, I was working as an investigative correspondent for CNN. I interviewed Williams for a story about the coming financial crisis. Most so-called experts, at the time, did not see the financial meltdown coming, let alone that all the banks were in trouble. Williams’ assessment of the economy was spot on in 2008. I don’t see how you can characterize what we have now as anything but a “severe recession.” Accurate information is the first and foremost reason to use someone as a source when you are a journalist. In my experience, what I have gotten from Williams has been stellar. (Click here for the 2008 CNN story featuring Williams and his predictions for the President in 2012.) (Click here for shadowstats.com)

Williams also predicted 2 years ago we would have a “hyperinflationary depression” within 10 years. Then, about a year ago, he revised his prediction and narrowed the window to “five years.” The day before last Friday’s dismal jobs report, Williams said, “. . . the timing of the looming U.S. financial Armageddon is coming into better focus, with increasingly high risk of it breaking within the next six months to a year.”

“Financial Armageddon . . . within the next six months to a year.” I called Williams to see why the odds of calamity have accelerated. He told me on the phone last night, “What is happening now to bring the timing into focus is the economy IS turning down. It is no longer the perspective the economy is going to turn down. That, in turn, will eventually trigger all the problems with the dollar, the debt and the deficit.”

For confirmation the economy is rolling over, look no further than the awful jobs report from the government last Friday. The Bureau of Labor Statistics (BLS) reported July payrolls fell 131,000. To add insult to injury, the June jobs number was revised downward. The economy lost 221,000 jobs which is considerably more than the 125,000 the government reported last month.

You want more confirmation the economy is in the tank? Also, last week, the government revealed a record 40.8 million Americans are now on food stamps. More budget woes can be seen at the state level. Congress just passed an emergency aid package worth $26 billion to save teachers’ jobs around the country. States are facing $200 billion in shortfalls in the coming months. California is one of the worst, with a $19 billion budget hole to fill and a $500 billion in underfunded pensions . Commercial and residential real estate is still losing value, and set to take another plunge.

So, what’s the government doing about the economy? The Fed has set interest rates at near 0% for more than a year and a half. The economy is not taking off. According to a recent article from financial writer Jim Willie, who has a PhD in Statistics, “Never in US history has a recession struck after several extended months of emergency ultra-low interest rates. This will be the first such occurrence. The policy response from the USFed must therefore be limited. They cannot reduce the official interest rate, unless below 0% (which did happen briefly in Japan). The nation stands on the doorstep of hyper-inflation. The only available tool within the USFed tool bag is Printing Pre$$ activity, pure monetization of both USTreasurys and USAgency Mortgage Bonds.” (For the complete Willie article click here.)

How much of a chance is there the Fed will just print money to pay bills? When asked how the Fed was going to stop the slide in the economy on CNBC, St. Louis Fed President James Bullard said, “Quantitative Easing is our best bet.” For us regular folks, QE means printing money out of thin air. I talked about this in a recent post called “Money Printing Is Our Best Bet.”

How fast could things go downhill when real trouble starts? Mallory Factor at Forbes laid it out nicely in an article last week called “Collapse In Internet Time.” Factor writes, “In an age when billions of dollars in securities are traded in nanoseconds, when a 24-hour news cycle seems long, why should national decline be exempt from what the Germans call Zeitgeist, the spirit of the age? The Book of Revelation, speaking allegorically of ancient Rome, states, “Alas! Alas! You great city, you mighty city, Babylon! For in a single hour your judgment has come.” Ancient Rome surely did not expect its sudden fall any more than the Soviet Union did in 1991, or than America does now.” (Click here for the complete Forbes article.)

Ultimately, the immense debt and deficits of the United States will crush the dollar. In his most recent report, Williams says, “The unfolding renewed decline in economic activity now is likely to be one of the proximal triggers for an even greater systemic solvency crisis, one that will pummel the U.S. dollar, threaten the solvency of the U.S. government and set the stage for a hyperinflation in the United States. In turn, such a crisis would exacerbate the intensifying downturn into a hyperinflationary great depression.”

No one knows exactly when the buck will buckle, but it looks like the dollar will take a short walk off a tall building a lot sooner than later.
__________________


"Staring Into the Abyss" by Martin Armstrong

Martin Armstrong is probably the top economist in the world. Even Jim Sinclair bows to his prognostications and we all know how smart Sinclair is. Armstrong is presently in jail for refusing to give the government the software he created that was able to uncover the formula for what makes the world markets work and thus predict future market action with accuracy. He writes letters from Jail....when he can. This latest letter needs to be read and understood by all. He tells us what we all mostly know and that is that we are on the verge of the end of western civilization...

***************
Please click on the link for the entire letter.

http://www.martinarmstrong.org/files/Staring-into-the-Abyss-7-31-2010.pdf

The purpose of these reports is to broaden the understanding that is so vital to our personal survival. Government cannot save us, and will only assist the very economic disaster we face. This is a Sovereign Debt Crisis that threatens our core survival.

There is no plan to ever pay off debts. The majority of debt increase- is paying interest perpetually to roll over without any long-term plan. What you see in Greece and in the States is that we have run out of other people's money.

The Socialists keep pointing to the rich. But to fund the deficits, we need to borrow now from foreign lands. We ran out of money domestically and to support the current system, like Greece, we need foreign capital. But all governments are facing the same crisis and we are on the verge of another widespread government default. Adam Smith Warned in his Wealth of Nations that in 1776, no government ever paid off their debt and had always defaulted. We will have no choice either.

There is no hope that politicians will save us, for they only form committees to investigate after the shtf. They will NOT risk their career for a future problem that may hit on someone else's watch. There was a politician and a average man standing on top of the Sears‘ Tower when a gust of wind blew them off.The average man being a realistic pessimist, immediately sees he is about to die and begins praying. The politicians, the ultimate optimist, can-be heard saying -"Well so far so good!" as he passes the 4th floor.

At Princeton Economics, our mission was simply to gather global data and to bring that together to create the world's largest and most comprehensive computer system and model that would monitor the world capital flows. By creating that model, all the fallacies of market and economic theories were revealed. The world is far more dynamic and every change even in a distant land can alter the course of the global economy.

Just as has been shown with the turmoil in Greece, a CONTAGION takes place and now capital begins to look around at all countries. We can no more comprehend the future by looking only at domestic issues today than we can do so in every other area, such as disease and the spread of flu.

We live in a NEW DYNAMIC GLOBAL ECONOMY where capital rushes around fleeing political changes and taxes just as it is attracted by prosperity. All the people who migrated to the United States in the 19th and 20th Centuries, came for the same reasons as those still coming from Mexico - jobs and prosperity. In the 19th Century, America was said to have so much wealth, its streets were paved in gold. We must now look to both the past and the entire world to understand where we now are today.

When all is said and done, no matter how we spin the story, we are in the final stages of the collapse of Western Society as we know it. By that I do not mean the sky will fall and people will be running through the streets naked fighting over 2 week old bread. That did not even happen with the fall of Rome, nor with Communism in China and Russia. It is possible that our political ruling class become so desperate that they take the tyranny path to extort every dime from the people hoping to hold on to the fleeting moments of past glories.

When it is all said and done, we will ask how was this citadel of the earthly powers of man fallen, and laying motionless and prostrate on the ground before all the great empires that have expired before it. The answer will be the same, DEBT and FISCAL MISMANAGEMENT. Our greatest problem has been our arrogance and presumption that we have conquered history and the laws of PRACTICAL ECONOMICS do not apply.

When empires die, the clash between private and public assets swings into the hyperactive mode. Those who see only the Dow crumble and fall to 1400 because that is what happened in 1929, fail to ever understand that such an event took place because of DEFLATION that was created by the fact that the dollar rose to extreme levels when everyone else was defaulting in 1931. This is WHY Roosevelt confiscated gold and devalued the dollar by raising gold from $20 to $35. Money was still something tangible. Today, we are looking at a massive sovereign debt default on a worldwide level.

Under a situation from the European view in 1931, the ONLY thing to survive was tangible assets. That is not merely gold, but shares in corporations with tangible value.

VELOCITY is always the key for as it declines due to people hoarding money you get DEFLATION. When people are afraid the money will become worthless (paper or debased coinage), they spend it faster before it depreciates and that creates HYPERINFLATION at the other extreme. It all depends on where the CONFIDENCE resides - with government or within the private sector. We are headed into the latter.

I have been working at full speed to get this book complete. I have passed the 300 page mark and I am deeply in debt to those assisting me on the outside to get me the reference material I need to ensure this is more than just an opinion, but also authoritative. Adam Smith in his Wealth of Nations wrote in his final volume about PublicDebt and what he asked was why people had ever considered lending money to government quality. I have been working on this issue in great detail.

Smith stated that never had any government EVER paid off its debt and that was in 1776. He was correct. I am assembling all the defaults that are.a subject that no one seems to want to talk about..Yet, there are stark and monumental conclusions that emerge from such a longlist of defaults.

Society does NOT end as the doomsday crowd portray. This seems to be just their desire or opinion. Many seem to wish disaster upon the world for they feel cheated and did not become rich with the crowd. But those sorts of claims are truly the exception. The fall of Rome ended in disaster as people fled cities and the population of Rome itself fell from 1 million to just 30,000. That was what the Romans called suburbium and why we still today call moving out of the city to the suburbs. That flight took place because of the collapse in the Rule of Law and unprecedented taxation that set in motion a migration that eventually led to feudalism.

Today, we have no place to go. We have run out of room. It is possible that government becomes so hostile that they will call the troops out against our own people. But that does NOT always succeed.The troops in China and Russia hesitated.to slaughter the people. In the famous Nika Revolt in Constantinople of January 532 ("Nika" means conquer), the Emperor Justinian feared for his life because the troops would not defend him. He was lucky that there were foreign mercenaries that were nearby and they came to his aid and slaughtered about 30,000 citizens who had gathered in the Hippodrome (local stadium where the chariot races took place).

In most cases, there is no civil war. Typically, the government collapses. In ancient times they may assassinate the head of state, but that tended to be more in the line of monarchs who ruled for life. The Puritans cut off the head of Charles I in England, but that was just when "the slave" becomes king, he becomes even more ruthless than the person he overthrows. Oliver Cromwell put his own portrait on the coinage as if he was king. Napoleon crowned himself Emperor, and Stalin murdered over 20 million people after claiming injustice of the monarch Nicholas Romanov, murdering him and his whole family in July 1918.

Clearly, sometimes revolution produces far worse alternatives.Yet the unifying trend firm ties all of these events together is FISCAL MISMANAGEMENTand a DEBT CRISIS. This is far more serious than a mere 1929 correction.

When governments collapse, it can get very, very nasty. This is when tangible items of value, gold, art, and MOVABLE objects has a basic barter worth. Land typically declines to its basic value NON—LEVERAGED cash value. Even during the Great Depression, land that was valued at $1.20 in the mid 1800s per acre fell to 30 cents. This is caused by the LACK of any credit to allow borrowing that is LEVERAGE in the real estate market.

A 30 year mortgage brings forward 30 years of future income today. It is not money yet earned. Even when we look at Spain and France,one must ask WHY these two European nations have failed to climb to the level of being the Financial Capitol of Europe? Both nations adopted the Economic Conquest Model. In plain words, this was the Roman model of plunder.

They sought to advance by conquest gathering all the money they could from foreign lands.They FAILED to look at their people as any sort of a worthwhile resource. They did not seek to develop industry. They did to some extent support merchantilism. However, in the case of Spain, they were so busy just extorting gold and silver from America, in fact they spent it long before the ships ever arrived. They did not use that money -to develop the economy. They imported the menial labor from France, and spent the money on fatal conquest attempts like the conquest of Netherlands and the Spanish Armada against England.

Charles I (1516-1556) of Spain was also the Holy Roman Emperor Charles V(1519-1556). He exploited Spain-to further his glorified interests as Emperor and sent the nation into bankruptcy. Spain defaulted on its debt in 1557, 1570 in Antwerp, 1575, 1596, 1607, 1647, 1662,1695,and 1697 just for starters.

Both France and Spain were serial defaulters. Why would anyone lend them money cannot be rationally explained. This is why after wiping out both the German and Italian bankers, the Financial Capitol unwed to Amsterdam. When a (Dutch) king took over England in 1689, and William of Orange brought Dutch ideas with him the Financial Capital moved to London.

During the Panic of 1896 when the US was bankrupt, J.P. Morgan convinced his British banking friends to lend to the US Treasury. After World War I, London gave up the Financial Capitol to New York.

In 2000, New York had 60% of the world IPO market. Because of the outrageous decline in the Rule of Law in the United States, that has fallen to less than 5% and now foreign companies no longer feel it is prestigious to be listed in New York.

The US is losing that status rapidly and the limp ending DEBT CRISIS will be the final straw.
We have a front—row seat to what will prove to be the most economic interesting times in the history of man. Will we turn to internal war or international war over a DEBT CRISIS our public officials refuse to discuss at all? Or can we save society and preserve our CULTURE for our children? These are the most important questions that need to be answered authoritatively.

Meanwhile, the markets are performing according to script. The one thing about the market and FREE MARKET THEORY, which the socialists hate, is that the markets are NEVER wrong. It our job to interpret what they are trying to tell us for they collectively see all truth and cut through all the crap. The socialists hate this theory because they want to manipulate society and the finances to achieve their Marxist goals that are unsupportable.

The problem is the markets are making a critical staging decision at this time. They are sorting out the whole idea of a DOUBLE DIP, how far, and how will this effect the future in terms of months, years,decades, and centuries.

The markets are deciding the extent of a FAKE—OUT MOVE that means there is typically a move in the OPPOSITE direction- from the true direction the market will adopt. we look into August, there still to be that this upcoming month will the decision point.The main vital support during August lies at 9295 with the major support at the 8050 level.

U.S. Is Bankrupt and We Don’t Even Know It: Laurence Kotlikoff


Commentary by Laurence Kotlikoff

Aug. 11 (Bloomberg) -- Let’s get real. The U.S. is bankrupt. Neither spending more nor taxing less will help the country pay its bills.

What it can and must do is radically simplify its tax, health-care, retirement and financial systems, each of which is a complete mess. But this is the good news. It means they can each be redesigned to achieve their legitimate purposes at much lower cost and, in the process, revitalize the economy.

Last month, the International Monetary Fund released its annual review of U.S. economic policy. Its summary contained these bland words about U.S. fiscal policy: “Directors welcomed the authorities’ commitment to fiscal stabilization, but noted that a larger than budgeted adjustment would be required to stabilize debt-to-GDP.”

But delve deeper, and you will find that the IMF has effectively pronounced the U.S. bankrupt. Section 6 of the July 2010 Selected Issues Paper says: “The U.S. fiscal gap associated with today’s federal fiscal policy is huge for plausible discount rates.” It adds that “closing the fiscal gap requires a permanent annual fiscal adjustment equal to about 14 percent of U.S. GDP.”

The fiscal gap is the value today (the present value) of the difference between projected spending (including servicing official debt) and projected revenue in all future years.

Double Our Taxes

To put 14 percent of gross domestic product in perspective, current federal revenue totals 14.9 percent of GDP. So the IMF is saying that closing the U.S. fiscal gap, from the revenue side, requires, roughly speaking, an immediate and permanent doubling of our personal-income, corporate and federal taxes as well as the payroll levy set down in the Federal Insurance Contribution Act.

Such a tax hike would leave the U.S. running a surplus equal to 5 percent of GDP this year, rather than a 9 percent deficit. So the IMF is really saying the U.S. needs to run a huge surplus now and for many years to come to pay for the spending that is scheduled. It’s also saying the longer the country waits to make tough fiscal adjustments, the more painful they will be.

Is the IMF bonkers?

No. It has done its homework. So has the Congressional Budget Office whose Long-Term Budget Outlook, released in June, shows an even larger problem.

‘Unofficial’ Liabilities

Based on the CBO’s data, I calculate a fiscal gap of $202 trillion, which is more than 15 times the official debt. This gargantuan discrepancy between our “official” debt and our actual net indebtedness isn’t surprising. It reflects what economists call the labeling problem. Congress has been very careful over the years to label most of its liabilities “unofficial” to keep them off the books and far in the future.

For example, our Social Security FICA contributions are called taxes and our future Social Security benefits are called transfer payments. The government could equally well have labeled our contributions “loans” and called our future benefits “repayment of these loans less an old age tax,” with the old age tax making up for any difference between the benefits promised and principal plus interest on the contributions.

The fiscal gap isn’t affected by fiscal labeling. It’s the only theoretically correct measure of our long-run fiscal condition because it considers all spending, no matter how labeled, and incorporates long-term and short-term policy.

$4 Trillion Bill

How can the fiscal gap be so enormous?

Simple. We have 78 million baby boomers who, when fully retired, will collect benefits from Social Security, Medicare, and Medicaid that, on average, exceed per-capita GDP. The annual costs of these entitlements will total about $4 trillion in today’s dollars. Yes, our economy will be bigger in 20 years, but not big enough to handle this size load year after year.

This is what happens when you run a massive Ponzi scheme for six decades straight, taking ever larger resources from the young and giving them to the old while promising the young their eventual turn at passing the generational buck.

Herb Stein, chairman of the Council of Economic Advisers under U.S. President Richard Nixon, coined an oft-repeated phrase: “Something that can’t go on, will stop.” True enough. Uncle Sam’s Ponzi scheme will stop. But it will stop too late.

And it will stop in a very nasty manner. The first possibility is massive benefit cuts visited on the baby boomers in retirement. The second is astronomical tax increases that leave the young with little incentive to work and save. And the third is the government simply printing vast quantities of money to cover its bills.

Worse Than Greece

Most likely we will see a combination of all three responses with dramatic increases in poverty, tax, interest rates and consumer prices. This is an awful, downhill road to follow, but it’s the one we are on. And bond traders will kick us miles down our road once they wake up and realize the U.S. is in worse fiscal shape than Greece.

Some doctrinaire Keynesian economists would say any stimulus over the next few years won’t affect our ability to deal with deficits in the long run.

This is wrong as a simple matter of arithmetic. The fiscal gap is the government’s credit-card bill and each year’s 14 percent of GDP is the interest on that bill. If it doesn’t pay this year’s interest, it will be added to the balance.

Demand-siders say forgoing this year’s 14 percent fiscal tightening, and spending even more, will pay for itself, in present value, by expanding the economy and tax revenue.

My reaction? Get real, or go hang out with equally deluded supply-siders. Our country is broke and can no longer afford no- pain, all-gain “solutions.”

(Laurence J. Kotlikoff is a professor of economics at Boston University and author of “Jimmy Stewart Is Dead: Ending the World’s Ongoing Financial Plague with Limited Purpose Banking.” The opinions expressed are his own.)

To contact the writer of this column: Laurence Kotlikoff at kotlikoff@bu.edu
Last Updated: August 10, 2010 21:00 EDT

My only question is this-can it, when it, or will it get to the point of riots, fighting, mass looting, etc.?

Ask and you shall receive:

30,000 line up for housing vouchers, some get rowdy

This appears to be the shape of riots to come...

Remember this, if people do not eat they die, when people face death from starvation they are a lot more afraid of a slow death than a man with a gun, America is a net importer of food, America has X numbers of people requiring X numbers of...... calories, when China and other foreign nations quit taking the dollar for their exported food, Americans will starve and all those military and police will be the least of their problems, being that a swift death is preferred to slow one. As surely as the sun rises and sets judgement is coming upon the apostate !

Yes sir that is so very true.

Also those who have the Guns will be the last to starve.

And who is it that have the guns, it is people like the members of this board, and the other Conservative Gun Owners, it is not the Liberal Sheep from the Suburbs and it is not the Liberal Welfare Dependent denizens of the Inner City.

It will be extremely hard if not almost impossible for the Government to keep millions of hungry, angry gun owners from getting the food that they and their families need.

isn't there supposed to be a Chinese Curse, May You Live In Interesting Times, Well I believe the future is going to be very, very, very interesting indeed.

In my experience, those who are properly prepped will have plenty of food, as well as the means to protect it from the rampaging, ill-prepared, zombie hoards.

According to an NBC News/Wall Street Journal poll, nearly two-thirds of all Americans believe the economy hasn\'t yet hit the bottom . So much for that "Recovery Summer" Tim Geithner keeps talking about.

Onward and upward,
airforce

"Are You Ready for the Next Crisis?"

By Paul Craig Roberts

Evidence that the US is a failed state is piling up faster than I can record it.

One conclusive hallmark of a failed state is that the crooks are inside the government, using government to protect and to advance their private interests.

Another conclusive hallmark is rising income inequality as the insiders manipulate economic policy for their enrichment at the expense of everyone else.

Income inequality in the US is now the most extreme of all countries. The 2008 OECD report, “Income Distribution and Poverty in OECD Countries,” concludes that the US is the country with the highest inequality and poverty rate across the OECD and that since 2000 nowhere has there been such a stark rise in income inequality as in the US. The OECD finds that in the US the distribution of wealth is even more unequal than the distribution of income.

On October 21, 2009, Business Week highlighted a new report from the United Nations Development Program concluded that the US ranked third among states with the worst income inequality. As number one and number two, Hong Kong and Singapore, are both essentially city states, not countries, the US actually has the shame of being the country with the most inequality in the distribution of income.

The stark increase in US income inequality in the 21st century coincides with the offshoring of US jobs, which enriched executives with “performance bonuses” while impoverishing the middle class, and with the rapid rise of unregulated OTC derivatives, which enriched Wall Street and the financial sector at the expense of everyone else.

Millions of Americans have lost their homes and half of their retirement savings while being loaded up with government debt to bail out the banksters who created the derivative crisis.

Frontline’s October 21 broadcast, “The Warning,” documents how Federal Reserve Chairman Alan Greenspan, Treasury Secretary Robert Rubin, Deputy Treasury Secretary Larry Summers, and Securities and Exchange Commission Chairman Arthur Levitt blocked Brooksley Born, head of the Commodity Futures Trading Commission, from performing her statutory duties and regulating OTC derivatives.

After the worst crisis in US financial history struck, just as Brooksley Born said it would, a disgraced Alan Greenspan was summoned out of retirement to explain to Congress his unequivocal assurances that no regulation of derivatives was necessary. Greenspan had even told Congress that regulation of derivatives would be harmful. A pathetic Greenspan had to admit that the free market ideology on which he had relied turned out to have a flaw.

Greenspan may have bet our country on his free market ideology, but does anyone believe that Rubin and Summers were doing anything other than protecting the enormous fraud-based profits that derivatives were bringing Wall Street? As Brooksley Born stressed, OTC derivatives are a “dark market.” There is no transparency. Regulators have no information on them and neither do purchasers.

Even after Long Term Capital Management blew up in 1998 and had to be bailed out, Greenspan, Rubin, and Summers stuck to their guns. Greenspan, Rubin and Summers, and a roped-in gullible Arthur Levitt who now regrets that he was the banksters’ dupe, succeeded in manipulating a totally ignorant Congress into blocking the CFTC from doing its mandated job. Brooksley Born, prevented by the public’s elected representatives from protecting the public, resigned. Wall Street money simply shoved facts and honest regulators aside, guaranteeing government inaction and the financial crisis that hit in 2008 and continues to plague our economy today.

The financial insiders running the Treasury, White House, and Federal Reserve shifted to taxpayers the cost of the catastrophe that they had created. When the crisis hit, Henry Paulson, appointed by President Bush as Rubin’s replacement as the Goldman Sachs representative running the US Treasury, hyped fear to obtain from “our” representatives in Congress with no questions asked hundreds of billions of taxpayers’ dollars (TARP money) to bail out Goldman Sachs and the other malefactors of unregulated derivatives.

When Goldman Sachs recently announced that it was paying massive six and seven figure bonuses to every employee, public outrage erupted. In defense of banksters, saved with the public’s money, paying themselves bonuses in excess of most people’s life-time earnings, Lord Griffiths, Vice Chairman of Goldman Sachs International, said that the public must learn to “tolerate the inequality as a way to achieve greater prosperity for all.”

In other words, “Let them eat cake.”

According to the UN report cited above, Great Britain has the 7th most unequal income distribution in the world. After the Goldman Sachs bonuses, the British will move up in distinction, perhaps rivaling Israel for the fourth spot in the hierarchy.

Despite the total insanity of unregulated derivatives, the high level of public anger, and Greenspan’s confession to Congress, still nothing has been done to regulate derivatives. One of Rubin’s Assistant Treasury Secretaries, Gary Gensler, has replaced Brooksley Born as head of the CFTC. Larry Summers is the head of President Obama’s National Economic Council. Former Federal Reserve official Timothy Geithner, a Paulson protege, runs the Obama Treasury. A Goldman Sachs vice president, Adam Storch, has been appointed the chief operating officer of the Securities and Exchange Commission. The Banksters are still in charge.

Is there another country in which in full public view so few so blatantly use government for the enrichment of private interests, with a coterie of “free market” economists available to justify plunder on the grounds that “the market knows best”? A narco-state is bad enough. The US surpasses this horror with its financo-state.

As Brooksley Born says, if nothing is done “it’ll happen again.”

But nothing can be done. The crooks have the government.

Note: The OECD report shows that despite the Reagan tax rate reduction, the rate of increase in US income inequality declined during the Reagan years. During the mid-1990s the Gini coefficient (the measure of income inequality) actually fell. Beginning in 2000 with the New Economy (essentially financial fraud and offshoring of US jobs), the Gini coefficient shot up sharply.

Paul Craig Roberts was Assistant Secretary of the Treasury in the Reagan administration. He can be reached at: PaulCraigRoberts@yahoo.com

"Do you have enough food and supplies on hand?"

Will Quantitative Easing By The Federal Reserve Unleash Economic Hell?

The Economic Collapse
Aug 13, 2010

Prior to the financial crisis of 2007 and 2008, the Federal Reserve could always count on being able to stimulate the U.S. economy with a quick cut to interest rates. But now with interest rates just barely above zero, the Federal Reserve is searching for other ways to pump life into a U.S. economy that is staggering about like a drunken college student. One of the ways that the Federal Reserve can do this is through something called “quantitative easing”. In essence, what happens is that the Federal Reserve creates money out of thin air and starts buying things like U.S. Treasuries, mortgage-backed securities and corporate debt. But many economic analysts are now warning that further rounds of quantitative easing by the Federal Reserve could end up setting off a series of events that could ultimately unleash economic hell. In fact, there are quite a few high profile commentators who now believe that hyperinflation in the United States is absolutely inevitable.

For those not familiar with quantitative easing, Wikipedia has a pretty good definition….

The term quantitative easing (QE) describes a form of monetary policy used by central banks to increase the supply of money in an economy when the bank interest rate, discount rate and/or interbank interest rate are either at, or close to, zero.[citation needed] A central bank does this by first crediting its own account with money it has created ex nihilo (“out of nothing”).[1] It then purchases financial assets, including government bonds, mortgage-backed securities and corporate bonds, from banks and other financial institutions in a process referred to as open market operations.

But is it really a good idea for a privately-owned central bank to have the power to create money out of nothing and to do whatever it wants with it outside of U.S. government control?

Of course not, but we dealt with those issues in another article.

What we will concern ourselves with in this article are the negative effects that could be unleashed as the Federal Reserve further abuses this power.

Now keep in mind that disasters don’t usually happen overnight. They usually build over time. When the Federal Reserve begins new rounds of quantitative easing, it will take time for the effects to be felt.

And so far, the new quantitative easing measures that the Federal Reserve has implemented have been relatively mild….

*The Federal Reserve has announced that it will “continue to roll over the Federal Reserve’s holdings of Treasury securities as they mature”.

*The Federal Reserve has also announced that it has decided to reinvest principal payments on mortgage holdings into U.S. Treasury securities.

*The Federal Reserve Bank of New York announced on Wednesday that it will purchase $18 billion in U.S. Treasury securities between now and mid-September.

But most analysts are expecting quantitative easing by the Fed to accelerate – especially if the U.S. economy continues to flounder.

So is there a reason we should be concerned about all of this?

Well, yes there is.

Marc Faber, the author of “The Gloom, Boom and Doom Report”, recently warned CNBC that all of this intervention by the Federal Reserve is going to create a “final crisis” that will destroy the U.S. financial system….

“Investors should have listened to me already six months ago when I wrote that the Fed will continue to monetize … they will print and print and print until the final crisis wipes out the whole system.”

In a recent article, Bob Chapman of the International Forecaster described some of the financial gymnastics that our “financial authorities” go through just to keep the current shell game going….

But first, we ignore things like monthly hundred billion plus mathematical discrepancies between the amount of the government’s deficits and the amount of treasury bonds being sold. Then we give the proceeds from the bogus excess treasury sales to foreign countries, foreign central banks and sovereign wealth funds as well as Cayman Island hedge funds so they can do what with it? Why, so they can buy US treasury paper and agency paper, among other things. Yep, we set up the straw men, fund them with counterfeit money illegally created out of thin air beyond what is needed to fund the ever-increasing deficit being created by the drunken sailors running the US government, and we then magically create categories of new mega-buyers in our financial reports to show everyone how our treasury paper is just as “beloved” as in the old days. Why, even the totally bankrupt UK has magically created $180 billion for the express purpose of buying up those treasuries to keep the whole rip-off party going.

What a mess they have created.

Things have gotten so bad that even CNN is publishing articles that openly acknowledge the crisis. In a recent article on CNN entitled “Is This Finally The Economic Collapse?”, Keith R. McCullough warned that the Federal Reserve openly buying large amounts of U.S. government debt is a very dangerous threshold to cross….

Now that the US can’t cut interest rates any lower, the only option left on the table is what the Fed just announced it would start doing — buying Treasury debt. And that could lead the country to the brink of collapse: According to economists Carmen Reinhart & Ken Rogoff, whose views we share, crossing the 90% debt/GDP threshold is the equivalent of crossing the proverbial Rubicon of economic growth. It’s a point from which it’s almost impossible to return.

And that is the crux of the problem – the U.S. government has a debt that is absolutely spiralling out of control. This is a problem that has been building for decades and there simply is no quick fix for it.

But the truth is that it was seen as far back as 1835. In his article for CNN, Keith R. McCullough included a very appropriate quote by Alexis De Tocqueville, the author of Democracy in America….

“The American Republic will endure until the day Congress discovers that it can bribe the public with the public’s money.”

Today, approximately 57% of the U.S. government budget is spent on direct payments to American citizens or is money that is spent on behalf of individual American citizens.

For decades, the “Congress critters” have been bribing the American people (and each other) with massive payouts and have been getting away with it.

But now we are starting to pay the price.

The truth is that the U.S. government has become an expert on wasting money. Most of the folks populating Congress are so incompetent that they should not even be hired to mop the floors of a Dairy Queen, and yet they control how trillions of our tax dollars are spent.

The end result is that we have a financial mess that is absolutely unprecedented.

The U.S. financial system is doomed. The U.S. government and the Federal Reserve will probably end up trying to save it with a massive flood of paper money, and in the end that will likely result in the collapse of the U.S. dollar and hyperinflation.

But hopefully all of that is still a while away yet. For now, the Obama administration and the Federal Reserve are trying to play a very delicate balancing act and are trying to keep this giant house of cards from collapsing.

As incompetent as they are, let’s hope that they can keep things together for at least a while longer, because when things really fall apart we are all going to be feeling the pain.

A revolution is coming. It won't come from the militia groups or the "right wing". It will come from the uneducated, the poor, minorities and those dependant on government programs. When people find out that their currency is worthless,food stamp access cards will no longer pay for their food. And medicare, medicaid and social security will fail people will panic and I'm afraid will lead to riots that will make the LA riots look trivial. The social structure will collapse. People will realize that the idiots at MSNBC and CNN have duped them. The only saving graces for FOX are Stossel and Napolitano. (God bless them. Stock up on food and ammunition. It's going to get ugly.

U.S. Dollar Now Ripe For Catastrophic Devaluation

By Giordano Bruno

Neithercorp Press – 08/09/2010

Normally when I cover subjects in the economy, I try to take a “macro” approach, giving an overall view of various financial elements around the world and how they are clearly connected to one another in a greater synchronous social force. That is to say, in Chinese domestic consumption, or European debt obligations, or Russian gold reserves, and in many other factors, is encoded the very future of our own American economy. Showing others how to decipher that code is my primary mission.

In this instance, however, I would like to focus chiefly on the U.S. Dollar, the private Federal Reserve currency which is now the basis for our entire financial system, not to mention a substantial basis for trade around the globe. For decades, the dollar (and by extension U.S. Treasury bonds) has been the standard by which foreign nations safeguard capital reserves, denominate debt, and in some cases have even pegged their own currency to maintain advantageous trade deficits. In the past, the Greenback has been treated as good as gold. Though many see this as a windfall for Americans, it is actually a very unfortunate circumstance.

The “world reserve” status of our currency created a demand for dollars, but through this, it also created a glut of Treasury bond holdings in foreign central banks, and an unserviceable national debt here at home. The combination of removing the dollar from the gold standard in tandem with gaining world reserve advantage allowed our government along with central bankers to create the most precarious illusory fiat currency in history. Could this process continue indefinitely? Its possible, but only if the demand for dollars continues to rise annually. As long as people want dollars in greater and greater amounts, we could continue to expand our debt into infinity. But what happens if demand for the dollar falls, or disappears entirely? The massive liabilities we have already accrued will no longer have the crutch of perpetual Treasury investment. We no longer would receive the busloads of foreign capital we need to continue functioning. The system we have staked the future of our culture on would disintegrate.

Anyone who uses common sense would easily conclude that it is highly unreasonable if not outlandish to expect that other countries will continue to pump more and more money every year into our very unstable system. Even if Treasury bond investment simply plateaued, remaining steady for years, we would still be crushed under the weight of our debt obligations. As our government expands, and our wars expand, so do our costs, and our interest payments. Eventually, every undisciplined debtor hits a state of critical mass; a point at which he runs out of options in extending his ability to outrun bankruptcy. We are seeing this right now in the U.S., most prominently in municipal debt in states such as California and Illinois. These are not just “local problems”. The growing insolvency in states is a direct reflection of the growing insolvency in the Federal Government.

Many people have at one time or another been caught up in their own debt race, trying to dodge bills and pay off one credit card with another credit card. They understand well that this terrible circle ends in ruin. This is the situation we are in as a nation.

Strangely though, some mainstream economists and analysts still contend that America will never face consequences for its fiscal debauchery. Why do they believe this despite all the evidence to the contrary? Because of a magical machine called a “printing press”.

“If foreign investment in our debt ceases”, they say, “The Federal Reserve can just PRINT the money our government needs to function out of thin air.” That is to say, these economists (which include men like Ben Bernanke) either truly believe that capital can be created out of nothing with no sacrifice attached, or, they KNOW there is a serious sacrifice attached, but intend to keep this fact from the American public. Regardless, the end result is the same; massive liquidity injections which continually monetize debt as it defaults, and Federal Reserve purchases of our own T-bonds. We are buying stock in our own dollar just to prop up its value and keep our country afloat!

The inflation vs. deflation debate has been raging for nearly three years, but I suspect that when all is said and done, we will find that both sides in a sense were correct. The people who consistently miss the mark on what is truly going on in the economy are those who blindly insist that this is an either/or situation. The fact is, we are seeing symptoms of BOTH deflation and inflation simultaneously. Deflation in jobs, stocks, real estate, and wages. Inflation in energy, food, and commodities. At bottom, we are seeing the worst of both worlds colliding to make a financial mutation, an aberration of the natural processes of supply and demand. Our economy has become a frothing rampaging Frankenstein’s monster bent on the destruction of its former benefactors; the American citizenry. Anyone who alleges otherwise is either a liar, or a fool.

At the very heart of this nightmare, we find the U.S. Greenback; perhaps the number one reason the economic meltdown was engineered by global banks in the first place (yes, I said ‘engineered’). The sovereign ideology of the U.S. is the only thing left standing in the way of complete centralized economic control, and by extension, political control, by the top 2% wealthiest people in the world, who now hold around 50% of all the world’s assets. The dollar, though a fraudulent fiat currency, is still a representation of that sovereign drive, at least in terms of finance. Its position as the foremost traded currency on the planet affords us great leeway in our ability to spend without fear. It is the glue holding absolutely everything together. With most of our industry shipped overseas, and our communities completely reliant on a 70% service based system, the Dollar is the only homemade “product” America has left to lean on.

Unfortunately, the strength of our currency is waning, and nearing outright collapse. It is something we have been talking about for the past two years at least, which has drawn some into a false sense of security. The signs have been muddled in the MSM fog, but now the picture is becoming clear. Will the dollar crash tomorrow? That’s hard to say. What I do know, is that all the elements necessary for a catastrophic dollar devaluation have moved into place, especially in the past month. That is to say, there is now nothing preventing a steady and precipitous fall in the Greenback over the next six months or more. Below are many signals which indicate such an event is near:

Dollar Index Plummeting: Interestingly, there has been very little coverage in the mainstream news of the dollar’s continuous 9 week decline, the longest straight weekly decline since 2004. One would think this is something that might concern the general public, and not just investors:

http://www.marketwatch.com/story/dollar-consolidates-as-markets-await-payrolls-2010-08-06

http://www.bloomberg.com/news/2010-...est-since-2004-as-fed-meeting-looms.html

The dollar is also nearing a 15 year low versus the Japanese Yen:

http://www.reuters.com/article/idUSTRE6713HB20100806

Only in the past few days have some MSM analysts ventured a response to this issue. So far, their primary excuse is that the dollar decline is due to the coming Federal Reserve meeting on August 10th, in which many suspect that the Fed will announce further stimulus measures and further inflation of the dollar. Of course, most Fed stimulus has remained undisclosed to the public, so there is really no way of knowing if they ever actually stopped their injections at all. Also, this excuse does not explain the 9 week duration of the dollar slide, especially since two months ago very few people even considered the possibility that the Fed would openly announce more liquidity measures.

Some economists might argue that the dollar has declined severely in the past, but has always come back. That is true, however, in those instances the dollar was not falling at the same time as stocks! Yes, the traditional inverse relationship between the DOW and the dollar seems to be ending, and this is a dour sign for the Greenback. In the past, the dollar has benefited as a safe haven investment. When stocks went south, investors would throw their money into dollar backed securities like Treasuries in order to protect their savings. This caused the dollar to go up in value. In the past few months, though, the dollar has begun to fall in tandem with stocks, meaning, people no longer trust the dollar as a safe haven investment as they used to. If this trend continues over the next few months, it may be a sign of nearing dollar collapse.

For those who want to keep tabs on the dollar index, go here:

http://www.bloomberg.com/apps/quote?ticker=DXY:IND

China In Position: We have been warning at Neithercorp Press for years that China was positioning itself to dump its vast holdings of U.S. Treasury bonds and allow its currency, the Yuan or RMB, to appreciate in value. China has aspirations of world reserve status, and they have openly stated their goal of replacing the dollar as the premier internationally traded currency. I received a lot of ridicule back in 2008 and 2009 for suggesting that China was morphing its financial system away from exports and becoming a consumer based hub for the East in preparation to dump the dollar. Needless to say, China has indeed done this, all while MSM talking heads and their parroting followers continued to deny it was occurring. Now, members of China’s financial community, including former central bank advisers, are openly calling for the Chinese government to end its investment in American debt:

http://www.bloomberg.com/news/2010-...iquidity-for-china-yu-yongding-says.html

This news is compounded by an announcement from the Chinese Central Bank which set the gold investment community ablaze; China’s government is now fully opening markets to support gold investment and is even helping its banks to begin diversifying into gold:

http://www.reuters.com/article/idUSTRE6743ZF20100805

In China’s strictly controlled economy, such a change of policy is tremendous news with serious implications. China is the largest gold producer in the world, yet, the demand for precious metals is so high (especially by their central bank) that they are increasing shipments from overseas sources. This is good news for gold investors, but bad news for the dollar. China suddenly opens the gold floodgates (gold is the primary hedge against dollar collapse) while at the same time openly discussing the liquidation of their U.S. Treasury reserves? This is not a coincidence.

Another factor of some weight is the issue of weak spending power within China. Some argue that China’s low interest rates are creating a savings shortfall for Chinese consumers, making their move towards a consumption based economy difficult. What they don’t realize though is that this is yet another reason for the Chinese government to dump T-bonds and create a surge in the Yuan’s value. This would be an ideal method for increasing the buying power of the Chinese consumer:

http://www.bloomberg.com/news/2010-...o-help-banks-as-5-growth-risk-looms.html

Whether or not China’s goal is to help global banks deliberately destroy the dollar, they have the perfect alibi: The U.S. government demanded that China let the Yuan rise in value, China’s new consumer based economy needs a stronger Yuan if they are to survive, and the U.S. dollar is no longer a safe investment anyway. I’ll say it again; China is now ready to dump the dollar at anytime.

Housing Market Threatens Dollar: Remember Fannie Mae and Freddie Mac? You know, the mortgage agencies which hold $5 Trillion in sinking real estate securities? The companies that our Treasury has promised a never-ending bailout to? Well, they are back again. Fannie Mae has asked for yet another bailout after continued shortfalls. I have lost track of how many bailouts this makes:

http://www.marketwatch.com/story/fannie-taps-treasury-again-after-quarterly-loss-2010-08-05

These bailouts drag directly on our national debt, and are costing the American taxpayer billions. Why do Freddie and Fannie still need money? Because the housing market is still falling apart! The Treasury and Barack Obama recently admitted that they had “underestimated” the number of homeowners who were still behind on their mortgage payments by two months or more even after receiving government help through the HAMP program:

http://www.reuters.com/article/idUSTRE67553520100807?type=politicsNews

Nearly 20% of homeowners who received government aid are re-defaulting on their mortgages or are near re-default. The government originally reported that the number was only 7.7%. I remember well when the skewed numbers were released and the stock market rallied in jubilee at the success of the HAMP measures. It seemed to me that the government numbers did not jive at all with the rising rate of foreclosures. According to the Obama Administration and Treasury officials, it was an “error” on the fault of Fannie Mae. I suspect it was not error at all, but a deliberate effort to artificially pump up the so called recovery, just as the Labor Department has done in the past with unemployment statistics.

What does housing have to do with the Dollar? First, the Treasury’s commitment to Fannie and Freddie has placed the U.S. taxpayer at the edge of an endless debt vacuum. As long as real estate continues to crumble, as long as people continue to lose their jobs and default on their mortgages, we will have to continue bailing out Fannie and Freddie. This creates the potential for trillions of dollars of debt that will be monetized by the Federal Reserve, putting even more strain on the dollar. Second, the further into debt our country goes, the more tempted other countries will be to back out of U.S. Treasury investment. Currently, the vast majority of Treasury purchases by foreign buyers are short term, maturing in a matter of weeks. The U.S. cannot sustain itself on short term investment. I believe that our nation’s debt issues including the endless fallout from the mortgage crisis will cause a detrimental loss of faith in the dollar and I believe this will occur soon.

States Will Ask For Their Own Bailouts: States have accumulated over $2.4 Trillion in municipal debt (official number) over the past two years alone:

http://www.newsmax.com/Headline/deb...-states-poor-states/2010/08/01/id/366260

Local bond debts now take up at least 22% of our country’s GDP. These figures do not include the states’ $3 Trillion in pension obligations, which means we are looking more along the lines of 50% of our national GDP tied up in state debt. This has caused some Federal programs to be implemented while others are diminished. For instance, $14 billion has been taken from ‘future’ 2013 food stamp programs to help pay for teachers and school lunch programs now:

http://www.cleveland.com/open/index.ssf/2010/08/food_stamps_or_teachers_congre.html

How this works, I’m not really sure. It sounds very similar to the government method of “borrowing” from future Social Security accounts to pay for other programs today. It’s not surprising that Social Security is now (officially) in the red, and it is guaranteed that my generation will not see a penny of it when we retire (Retire?! Ha! I crack myself up!):

http://www.washingtontimes.com/news/2010/aug/5/social-security-red-first-time-ever/

The point is, not only California and Illinois, but many other states as well, are on the verge of municipal default. Some agencies still rate municipal debt very high, but they also rated subprime mortgages very high, and look what happened! No one in their right mind wants to touch municipal bonds today, and this will invariably lead to insolvency in cities and states, I believe we will see this begin before the year is out.

The response will be predictable; states will ask for Federal assistance to the tune of billions, leading eventually to trillions. States did receive some bailout funds up until December of last year, but it was nowhere near the capital they needed to survive. States are also rapidly losing revenues due to lower property taxes, lower consumer activity, etc. They have nowhere else to turn except a new Federal bailout specifically designated for municipal debt (unless the states want to actually grow some courage and assert 10th Amendment rights, taking back full control of their economies).

Again, the issue is and always has been DEBT. No government in the world has the ability to truly solve debt problems with more debt. There is always a price in making the attempt, and the price is usually steep. In our case, the price is the destruction of our currency. State debts will translate to Federal debts, which will translate to fiat creation and monetization, which will translate to loss of dollar faith, which will translate to loss of the dollar, period.

Turning Point For The Dollar, And For Us…

If you feel like you are looking out over the ocean at the towering black anvil cloud of an approaching tempest, that’s because you are. There are always indicators. The air electrifies, the waters whip and swell, the atmosphere grows heavy. Economics is the same way. After a time, you begin to feel the intensity of the financial stratum. The imbalances of the markets crackle, and thunderous roar of the typhoon grows near.

I and many other researchers hear this sound in terms of the U.S. dollar. The potential for a monetary breakdown has arrived.

I find there is persistent confusion amongst analysts as to what constitutes inflation. In my humble opinion, any event which causes the dollar to devalue and prices to rise is inflation. This does not necessarily require “overprinting” of physical money to take place, though I do believe overprinting is happening behind closed doors. The dollar can be compromised in many ways, not just through runaway fiat creation. Any loss of our world reserve status will result in a major devaluation. Any extended dumping of U.S. T-bonds by other countries will result in major devaluation. The endless accumulation of national debt without the backing of foreign capital will result in major devaluation. All of these problems are active in our economy right now. The end result; simultaneous inflation and deflation, and they don’t cancel each other out!

Some people regard this kind of information as “fear mongering”, or “doom and gloom”. Fear mongering suggests an exaggeration or even fabrication of facts in order to frighten the reader towards some particular end. It’s supposed to somehow benefit the fear monger. Nothing written above is an exaggeration, only a relay of the cold hard reality we face as a society, and frankly, I gain nothing by frightening anyone with these facts, not even notoriety, since I report under a pen-name. At bottom, if someone is terrified by the truth, that is their problem, not mine. The accusation does make me grin sometimes…

I have even come across a few people in the survivor and preparation field who seem strangely bothered by our efforts. The behavior is puzzling, but I suspect that some see the realm of collapse information as their own personal domain, one they would like to keep to themselves. And some, perhaps, feel that we are dwelling too much on the activators of collapse, when we should just make a few preparations and then go on with our day.

I and other researchers do what we do because we want others to be aware and organized. We give you the difficult data because we want you to stay informed and up to date on the latest developments, developments we feel you have a right to know about and the strength to take. Our goal is to fill the void of information that the MSM has left in its wake. There is a difference between paranoia, and vigilance. The paranoid only see threats in truth, threats they feel they can do nothing about. The vigilant see opportunities, ways of using the truth to deal with the dangers ahead. By keeping track of economic developments, the vigilant are far more mentally prepared than any survivalist who chooses to ignore them.

The gravity of the coming currency crisis is a crucial issue. According to the data, it is no longer a question of ‘if’ but ‘when’ it will reveal itself completely. We aren’t dealing with hypotheticals here, we are dealing with eventualities. The sooner the American public accepts this, the sooner we can confront the trouble head on.

Attention readers! Neithercorp.us is back! Well…sort of…
After a month of malicious hacking attempts on our site, 24 hours a day, seven days a week, we believe we have fixed the problem in the neitherpress section of the site and are ready to roll. Special thanks to Agentogden for all his hard work. Articles posted to our backup page neithercorp.blogspot.com, will be transferred here shortly. In the event that we are attacked again, our newest articles will be posted to this backup site. Thanks for sticking with us through this rough time, and make sure to come back soon. More in-depth analysis is on the way…

The Purpose Behind Engineered Economic Collapse

By Giordano Bruno

Neithercorp Press – 08/17/2010

“From now on, depressions will be scientifically created.” — Congressman Charles A. Lindbergh Sr. , 1913

Everyone loves money. Even people like myself who abhor the abuse of money and commerce, who understand the fraudulent nature of the system we live in, still work hard and save so that we might attain a sense of stability within that system. Many people see money as a focal point to their existence. But is it really money that they are after, or is it something else entirely? In truth, money represents ‘security’ in the minds of the masses. Money affords us the ability to survive, and the more of it we have, the safer we all feel. Because we subconsciously associate the extension of our very life with the variable health of the economic structure in which we live, we tend to become unwitting devotees to its continued existence, even if it is corrupt and condemned to failure. We gullibly deny the system or the currency that supports it is doomed to the contrary of all evidence because, even though it has beaten us bloody, we have never known anything else.

In light of this entrenched way of perceiving things, especially in the U.S., it is difficult enough to convince some people that the economy is in fact not providing the security they desire, but is actually destroying their future completely. To explain to them that this is deliberate, that the economy is designed to self-destruct, that is another prospect altogether.

Many people hit a proverbial wall on this issue because they simply cannot fathom that certain groups of men (globalists and central bankers) view money and economy in completely different terms than they do. The average American lives within a tiny box when it comes to the mechanics and motivations of finance. They think that their monetary desires and drives are exactly the same as a globalist’s. But, what they don’t realize is that the box they think in was BUILT by globalists. This is why the actions of big banks and the decisions of our mostly corporate establishment run government seem so insane in the face of common sense. We try to rationalize their behavior as “idiocy”, but the reality is that their goals are highly deliberate and so far outside what we have been taught to expect that some of us lack a point of reference. If you cannot see the endgame, you will not understand the steps taken to reach it until it is too late.

In the past we have covered numerous instances in which global bankers have admitted to fraud on a massive scale, fraud which is now crushing our already fragile economy. We have covered the private Federal Reserve and how it knowingly facilitated the creation of the housing bubble, as well as how it is now inflating a Treasury bubble which is soon to implode. We have covered Goldman Sachs and its efforts to promote and sell toxic derivatives all over the world while at the same time betting against those derivatives on the open market. We have covered the manipulation of gold and silver markets by companies like JP Morgan, which have recently been exposed by whistleblowers and GATA investigations. And, most importantly, we have executed in-depth analysis on the growing weakness of the U.S. dollar in preparation for severe currency devaluation. These revelations raise questions, which is natural, but they also illicit misconceptions and reckless knee-jerk reactions, especially when broaching the fact that the illegal strategies of international banks are part of a greater agenda.

Below, we will examine some of the most common narrow minded responses to the issue of engineered economic collapse, as well as why people think the way they do when the “semi-sacred” subject of money is involved…

1. The economy is too complex to be controlled by just a handful of people…

This response often comes from people who make presumptions on economics, rather than actually educating themselves on how the system works. From the outside looking in, the world of finance appears chaotic; a mixture of mathematical and legal standards swirling in a void of mass psychology. Many Americans are either frightened off by the seemingly complicated field of study, or they find it rather boring and not worth their time. This, however, does not stop them from assuming that they know how money works.

The problem is that just because a person participates in his economy daily, it does not mean he has any understanding of how it operates. Many watch television on a daily basis, but few have any idea how the picture actually gets onto the screen, or how to fix a television once it is broken. Sadly, our egocentric culture has led a substantial portion of the public to imagine that they are experts on EVERYTHING, and thus, true researchers in the fields of economics and globalism get reactions like the one above constantly.

At bottom, once all the quasi-technical biz-babble used by mainstream talking heads is removed from the equation, economics is rather simple. Supply and Demand will always be at the center of any and every economy, regardless of the political atmosphere it exists in. These two fundamental factors can be manipulated to a point, by the creation of artificial supply, or the conjuring of false demand. This is achieved in many ways by global bankers, but primarily through domination of the issuance of currency, the ability to change interest rates at will, as well as the ability to inject or remove incredible sums of money from any market.

A perfect example is the suppression of silver prices by JP Morgan:

http://www.zerohedge.com/article/whistleblower-exposes-jp-morgans-silver-manipulation-scheme

Gold and silver represent competing currencies to the fiat dollars created by the Federal Reserve, and suppressing the value of these commodities helps to ensure that the public will never see them as a viable alternative to paper assets. JP Morgan, who along with other international banks has the ability to throw around massive quantities of capital wherever they please, suppresses the value of physical silver by issuing paper securities for silver that doesn’t actually exist (creating an artificially high supply), and naked short selling silver markets to drive them lower (creating the false impression of low demand).

Another good example of economic manipulation is the private Federal Reserve’s strategy during the 90’s under Alan Greenspan to artificially lower interest rates, allowing banks to issue credit at historical levels for over a decade. Linked below is an article from Ron Paul’s ‘Texas Straight Talk’ dated March, 2007, before the housing market even began its full swan-dive. In it, he discusses the Federal Reserve’s direct role in the creation of the housing bubble:

http://www.house.gov/paul/tst/tst2007/tst031907.htm

Men like Ron Paul, Peter Schiff, Gerald Celente, Jim Rogers, and many others were able to predict long before hand that the Federal Reserve’s actions were creating an explosive mortgage and credit bubble, yet, we are supposed to believe that the Federal Reserve had “no idea” that their actions would result in a debt implosion?

Catherine Austin Fitts, former Assistant Secretary of Housing and Commissioner of the U.S. Department of Housing and Urban Development under the first Bush Administration stated conversely that the mortgage bubble was absolutely not an accident, and that she had witnessed outright and deliberate fraud on the part of the U.S. government and the Federal Reserve Bank in creating the bubble. The fact that disturbed her most, however, was her discovery that only a small handful of international banks were responsible for the perpetuation of toxic mortgage debt, not just in America, but around the world:

http://solari.com/blog/?p=2058

Goldman Sachs (one of the primary globalist banks involved in the igniting of the debt crisis) was caught red-handed selling toxic derivatives to investors and governments all over the planet while at the same time betting against those derivatives on the market. Goldman even bet against mortgage securities the bank itself created!

http://www.businessweek.com/news/20...t-its-own-deals-senate-s-levin-says.html

This is sort of similar to a car maker selling vehicles without brake lines, then placing bets that their clients will crash and burn. Essentially, it is blatant and sociopathic fraud! Goldman’s actions directly contributed to credit collapses in numerous countries, including Greece, and here in the U.S.

The idea that global banks can turn the economy on and off like a light switch may be a stretch, but the vast majority of evidence shows that they do have the ability to shift the direction of markets to a point, as well as the ability to spur the growth of bubbles that eventually lead to recessions, depressions, and beyond. In fact, if one examines the U.S. economy from the inception of the Federal Reserve in 1913, they would find that the past century has been nothing but a series of engineered equity bubbles designed to slowly hobble, but not completely cripple, our financial system and our currency, at least, until recently. Like a steam locomotive on a collision course with a bottomless canyon, globalist banks can slow or speed up the pace of our descent, but the final destination never changes.

Now that we have established that market collapses can be created by a small handful of bankers and done knowingly, lets move on to the next most common sheeple-like talking point.

2. Yes, international banks triggered the meltdown, but the “greed of Capitalism” is truly to blame (i.e. Its all the Republican Party’s fault)…

First off, if you’re parroting the fiscal debate points of two dimensional socialist gatekeepers like Michael Moore, then you’re already hopelessly lost in the mind warping hedge maze of the false left/right paradigm. You should stay as far away as possible from adult conversions on economics, especially if you plan on associating the “greed” of capitalism and corporatism with the Republican Party alone.

News Flash! Barack Obama received far more in corporate campaign donations (including donations from BP and Exxon) than McCain did. Both Bush Jr. and Obama increased government spending to record levels meaning Neo-Conservatives are in no way “conservative” (as a true Republican is supposed to be). Obama has consistently surrounded himself with banksters and corporate lobbyists, including various hobgoblins from the bowels of Goldman Sachs. BOTH major parties are owned and operated by global banks. This is a cold hard undeniable truth of our political system. There is no way around it. Learn it, accept it as reality, and stop trying to blame one side or the other for problems that both sides created! If you cannot do this, your view of our cultural state of affairs will always be horribly skewed and your insights on our social problems will be utterly worthless.

While wannabe socialists desperately clamor to point fingers at the free market ideology as the cause of all our ills, the fact is that none of us have ever lived in a truly free market system. Since the inception of the Federal Reserve in 1913, all markets and even our own currency have become more and more vulnerable to manipulation by the banking elite. We have lived our entire lives in a rigged market, not a free market. To blame the very concept of Capitalism for our current dire circumstances is not only naïve, it is dangerous. Globalists would like nothing better than to promote the illusion that “too much freedom” led us to this disaster, and that severe controls must be put into place to ensure that it “never happens again”.

3. Global banks would never engineer the collapse of the U.S. economy or the Dollar. It makes them too much money…

This often heard song and dance ties in with the number two comment above. Again, the assumption is that the globalists only do what they do out of an “uncontrollable greed for money”. This perpetuates a couple fallacies. First, it encourages the false belief that the end concern for the Elite is the accumulation of riches. Central bankers have the ability to PRINT all the money they want from thin air! Remember, the Federal Reserve has never been subjected to a full audit, meaning they could easily create billions if not trillions without any oversight whatsoever. Greed for money, to them, is surely an absurd notion. What they do want, more than anything else, is social power. They want control over every living human being without question. All other concerns are secondary.

The next fallacy underlying the above argument is the conjecture that the U.S. economy is somehow indispensable to global banks. This is simply not so. Where we see the economy as an extension of our culture and ourselves, the Elites see financial systems as mere tools in the pursuit of a greater goal: World Government. Imagine you are building a house. Once your saw has fulfilled its intended role of cutting the wood, do you cling to it, or do you throw it aside and pick up a hammer? This is how globalists look at financial systems. They are perfectly willing to cast off the U.S. economy like a snake shedding skin if it brings them closer to attaining their ultimate aim.

The same goes for the Dollar. The Greenback may be the premier world reserve currency now, but that can and likely will change very quickly over the next couple years. The Dollar is a device that has outlived its usefulness as far as global bankers are concerned. The IMF has on several occasions made it clear that they eventually intend for the SDR (Special Drawing Rights) to replace the Dollar as the world reserve currency, and they have openly admitted that it will one day be established as a global currency. IMF press releases make this development sound far off and away, but SDR accumulations by countries around the world have risen dramatically in the past year. This along with other factors we will cover (namely China’s preparations to dump their U.S. T-bond holdings) show that IMF actions indicate they are preparing for a collapse of the Dollar now!

4. China would never dump U.S. Treasuries because it would hurt them as much as it hurts us…

The theory that China is somehow fused to the U.S. in a kind of symbiotic seesaw relationship that can never be broken is so ingrained among mainstream American financial analysts it simply will not die, regardless of how much contradictory evidence you show them. It really is like a mental disease which causes MSM pundits to go into involuntary Tourettic convulsions every time you mention the words “Treasury bond dump”. America and China are not conjoined twins, and one can survive without the other. We have covered the China issue over and over again, and I will not rehash all that evidence here. To lay it out simply: China has re-engineered its economy towards consumption and importation rather than relying on exports. The IMF has talked about this on many occasions with apparent excitement:

http://www.imf.org/external/np/tr/2010/tr072910c.htm

China has also finalized the ASEAN trading bloc which has combined export markets at least equal to that of the U.S. Meaning, China already has another place to send its exports besides America.

Most importantly, China must increase their currency’s value if their new consumer based system is to survive. Allowing the Yuan to rise sharply in value will revitalize the buying power of the Chinese populace making greater consumption possible. Indeed, China MUST dump their Treasury holdings and pump up the Yuan if they are to hold their economy together. And, the Federal Reserve has given China every reason to turn its back on Treasuries through never ending liquidity injections. This is not to say that a U.S. collapse will not affect them, it would negatively affect the entire world. However, China has positioned itself to survive, and perhaps even thrive with their economic expansions into Africa, and their new financial agreements with Germany.

Finally, the Chinese have been very forthcoming over the past week about plans to drop Treasuries. China has dumped over 7.7% of their U.S. T-Bond holdings since January, including the biggest T-bond dump on record this month. They have openly admitted to a plan to diversify away from the Dollar:

http://www.bloomberg.com/news/2010-...-by-most-ever-as-u-s-yields-decline.html

I’m always fascinated by those economists who vehemently deny China will ever turn away from the U.S. Dollar while they are doing so right in plain view. Are MSM analysts simply crazy? I don’t know, but it would explain a lot…

5. Sure, bankers took advantage, but it’s really the American people’s fault for getting suckered…

Yes, a sizable portion of the American public can be gut wrenchingly stupid. It hurts my head and my feelings to see people act so idiotic, it really does. The problem with this argument though is that when it is taken too far it becomes an attempt to divert blame away from the criminals and place it on the victims. If you knowingly leave your front door unlocked in a bad neighborhood and you find your home ransacked the next day, then you are partly responsible. But, we cannot forget that the neighborhood is “bad” in the first place because of the criminals, not the people who don’t lock their doors.

Just because global banks can sucker the public doesn’t mean they should, or that they cannot be judged for it. The crime ultimately rests on those men who made the conscious effort to destroy this country, and the blame rests with them as well. I see the attempt to parlay the economic collapse into the lap of the American people very often lately, especially from bankers who now claim that it’s the American public’s fault entirely. Why? Because they will not spend more, they will not take on more debt, they will not take on more risk, and they will not believe hard enough in the recovery that never was. Imagine a serial rapist behind a podium admonishing women for carrying pepper spray. It’s eerily similar…

6. Ok, maybe the banks are causing a collapse, but to say the government is helping them is just crazy conspiracy theory…

Why is it that the Federal Reserve has never been fully audited? Why is it that when Ron Paul tried to pass HR 1207 Federal Reserve Transparency Bill, it was muddled in committees and then eventually derailed? Why is it that banks like Goldman Sachs have been caught, yes caught, setting the stage for an economic implosion in this country, yet no government indictments have been formed to criminally prosecute them? Why are these men still roaming free like locusts to continue pillaging at will? Are we supposed to feel lucky that we get table scraps like Bernie Madoff behind bars while the Federal Reserve commits Ponzi fraud on a scale that dwarfs his?

Our government, both major parties, is owned lock stock and barrel. This is why there are no satisfactory answers for the questions posed above. Elements of the U.S. Government including almost every president since 1912 have not only turned a blind eye to Globalist activities, they have offered their full support to the bankers.

Nixon removed the Dollar from the gold standard in 1971 giving the Fed free reign to print as much fiat as they wished without limitations. In 1980 the Depository Institutions Deregulation and Monetary Control Act was passed placing all banks essentially under the rules of the Federal Reserve. The Glass-Steagall Act which kept investment banks and depository banks separate was repealed under a Republican majority in the Senate, and then finalized by Democratic President Bill Clinton in 1999. 30 years ago, banks that held your home mortgage were for the most part required to keep that mortgage until it was finally paid. But, a series of government decisions spanning that period and influenced by global banks allowed for the “securitization” of mortgages, leading to the creation of “derivatives”, which were then used by corporate mobsters like Goldman Sachs to destroy our financial system. Last, but certainly not least, both the Bush and Obama Administrations pressured Congress into passing highly unpopular bailout legislation which basically rewarded the same banks that created the credit crisis with trillions in taxpayer dollars (yes, the bailouts are now actually in the trillions, not billions). This led to the coining of the term “too big to fail” (or “too big to jail”). Our Government has been nothing but complicit in the banker takeover of this country. To debate otherwise is to invite embarrassment.

I haven’t even scratched the surface of government involvement in the collapse of our economy. Cases like the Savings and Loan crisis of the 1980’s led to serious prosecutions and jail time for more than 1100 criminal bankers, but this only caused the government to respond by changing investigation rules to make it even more difficult to catch the high level fraudsters in the act! Linked below is an interview between Max Keiser and bank regulator Prof. William K Black who outlines our government’s complicity in the breakdown of the country it is mandated to protect:

http://www.youtube.com/watch?v=5Bf5Frx1lZk

Elites destroy cultures to make way for new philosophies; their philosophies. Its not so much “conspiracy theory” as it is a widely admitted methodology. Corporate globalists believe in global government on their terms and they barely try to hide it. If someone thinks this sounds “fantastical” then they haven’t been paying the slightest attention. When one understands how Elites view economy, and realizes their primary motivations, the fact that they purposely triggered a collapse is perfectly logical. Nothing besides all out war inspires more fear and desperation in a society than a financial upheaval. Such elements on a mass scale allow changes in our collective psychology that were never possible before. Most people tend to falter under such an overwhelming threat and turn towards any authority (or fake authority) to save them from harm. Some people scoff at this idea, but it is likely they have never actually been in the wake of a real national catastrophe before. Men, especially those who know little of themselves, can change quickly in the face of calamity. The Elites recognize this, engineer tragedy, then waltz into the aftermath to merrily lord over the rubble.

Will their plan work? I think not, but I’m an optimist (no, really). The pursuit of total control and total power seems rather infantile to me, be it on an impressively psychotic level. Although, if we are made to forget who the real enemy is, then I think they do have a chance at success. That is how they have remained successful to this point. Only now does the average man have such immense knowledge at his fingertips, the knowledge to bring down a line despots and tyrants that have reigned for centuries. If only the average man was not so easily deterred by WMD’s (Weapons of Mass Distraction). The Elites will likely ignite some wars, tempt us into in-fighting, and fabricate enemies like Al Qaeda out of the ether. As the slogan goes, “Order Out Of Chaos”. Whatever happens, our eyes must remain fixed on the root of the problem; the bankers, and nothing else.

Globalists are not invincible, they are not untouchable, they are not even all that brilliant. They are human, and they have made many mistakes. The engineering of an economic meltdown really changes nothing. Hired thugs, useful idiots, corrupt officials, even hyperinflation, all tiny obstacles when considering the world we could have if the Elites were finally made to face the reckoning they deserve. Americans once took on the greatest empire on Earth. We once took a feared king to task. Are a bunch of frothing corporate bankers really so daunting? All that is needed is a principled movement with the will to see justice done, and I believe we have that already.

You can contact Giordano Bruno at: giordano@neithercorp.us

Woof. Reach out. Reach out and touch someone. I like that part. Your right. There just people, and yes they too can and do make mistakes. They made one big mistake when they decided to mess with America.

That felt good just saying it. Now what? I dont care what anyone says. You cant vote these scum bags out. Thats not how this is going to work. Not what I want mind you. Just the way it is!!!

The U.S. Economy is NOT Getting “Better” – It’s Dying!

August 28, 2010 by Editor

The numbers don’t lie, and statistic after statistic shows that the economic fundamentals continue to get progressively worse… and anyone who claims that things are getting “better” is either ignorant, completely deluded or is purposely lying. The U.S. economy is not getting “better”. The U.S. economy is dying. Words: 1020

So says an article* at http://theeconomiccollapseblog.com entitled “15 Economic Statistics That Keep on Getting Worse.” Below Lorimer Wilson, editor of www.FinancialArticleSummariesToday.com, presents further reformatted and edited [..] excerpts from the article for the sake of clarity and brevity to ensure a fast and easy read. (Please note that this paragraph must be included in any article reposting to avoid copyright infringement.) The article goes on to say:

The U.S. government can continue to try to pump up with economy with more debt, but the reality is that there is not going to be a legitimate “recovery” until consumer spending rebounds. Consumer spending makes up the vast majority of U.S. GDP. Without good jobs, however, consumers are not going to be able to spend money and, unfortunately, our jobs base continues to be erode as millions upon millions of middle class jobs are shipped over to China, India and dozens of third world nations by the global predator corporations that now dominate the world economy. So where does that leave middle class American “consumers”? Well, it leaves us in a world of hurt.

15 Key Economic Statistics That Just Keep Getting Worse

1. The number of Americans who are receiving food stamps rose to a new all-time record of 40.8 million in May and has set a new all-time record for 18 months in a row. There is every indication that things are going to get even worse. The U.S. Department of Agriculture projects that the number of Americans on food stamps will increase to 43 million in 2011.

2. The U.S. economy lost 131,000 more jobs during the month of July… and has lost 10.5 million jobs since 2007. Meanwhile, immigrants (both legal and illegal) continue to pour into this nation in unprecedented numbers.

3. Americans who are out of work are finding it incredibly difficult to get back into the workforce with the average time needed to find a job having risen to an all-time record of 35.2 weeks.

4. The U.S. government keeps trying to pump up the economy with debt, and in the process things are getting wildly out of control. According to a U.S. Treasury Department report to Congress, the U.S. national debt will top $13.6 trillion this year and climb to an estimated $19.6 trillion by 2015.

5. The interest on all of this debt is becoming increasingly oppressive. As of July 1st, the U.S. government had spent $355 billion so far in 2010 on interest payments to the holders of the national debt. The total for 2010 should be somewhere in the neighborhood of $700 billion… and $2 trillion… by 2020. Keep in mind that the entire U.S. government budget is less than $4 trillion for the entire year of 2010.

6. If the U.S. government was forced to use GAAP accounting principles (like all publicly-traded corporations must), the annual U.S. government budget deficit would be somewhere in the neighborhood of $4 trillion to $5 trillion.

7. Social Security will pay out more in benefits in 2010 than it receives in payroll taxes. This was not supposed to happen until at least 2015. In the years ahead, these new “Social Security deficits” are projected to be absolutely catastrophic.

8. There are simply far too many retirees and not nearly enough workers to support them. Back in 1950 each retiree’s Social Security benefit was paid for by 16 workers. Today, each retiree’s Social Security benefit is paid for by approximately 3.3 workers. By 2025 it is projected that there will be approximately two workers for each retiree.

9. Wealth continues to become highly concentrated at the top. Since 1973, the average CEO’s salary has increased from 26 times the median income to over 300 times the median income.

10. According to a poll taken in 2009, 61 percent of Americans “always or usually” live paycheck to paycheck. That was up significantly from 49 percent in 2008 and 43 percent in 2007.

11. The Mortgage Bankers Association recently announced that more than 10% of all U.S. homeowners with a mortgage had missed at least one mortgage payment during the January to March time period. That was a new all-time record and represented an increase from 9.1 percent a year ago.

12. A recent survey of last year’s college graduates found that 80 percent moved right back home with their parents after graduation. That was up substantially from 63 percent in 2006.

13. During the first quarter of 2010, the total number of loans that are at least three months past due in the United States increased for the 16th consecutive quarter.

14. The total number of U.S. bank failures passed the 100 mark in July of this year. In 2009, the total number of U.S. bank failures did not pass the century barrier until October.

15. The U.S. dollar continues to rapidly decline in value. An item that cost $20.00 in 1970 would cost you $112.35 today. An item that cost $20.00 in 1913 would cost you $440.33 today.

Any rational observer… can see that the foundations of the U.S. economy are coming apart. The rapidly accumulating mountain of debt that has fueled our “prosperity” is impossible to repay and is going to progressively choke the life out of our economic system. The good jobs that we have allowed to be shipped out of our country are never coming back. Every single day, more wealth flows out of this country than flows into it.

Anyone who claims that things are getting “better” is either ignorant, completely deluded or is purposely lying. The U.S. economy is not getting “better”. The U.S. economy is dying. Adjust your plans accordingly.

*http://theeconomiccollapseblog.com/archives/15-economic-statistics-that-just-keep-getting-worse

Editor’s Note:
- The above article consists of reformatted edited excerpts from the original for the sake of brevity, clarity and to ensure a fast and easy read. The author’s views and conclusions are unaltered.

It wont be long now. Whew, when the American people realize they've been bamboozled. Look out. Wintertime is right around the corner, which always seems to slow things down to a crawl. Even it we don't live in the snow belt.

I have had to pick up an additional job just to attempt to hold on myself. My point is. I have observed that people are power shopping now more than ever. Looking for the cheapest price in all directions. Just an observation, which to me is an indicator of financial problems. Things are tight, duh. People do not have extra decressionary money to spend. Which will affect the economy. Unfortunately our economy is based on spending. If people cant or wont spend. Guess what happens to the economy. Exactly whats happening right now. This is only the beginning. Looks like a bumpy road ahead.

A few years back I went up to "THE" big city mall with a friend of mine. I remember wandering around the monstrosity and thinking to myself,"Who wants all this crap, who buys all this crap and HOW can they afford it?" I guess I'm getting the answer to that now. They can't! lol

McGrath: ‘Austerity Will Hit America Like An Eight Pound Sledgehammer’

Author: Mac Slavo - October 27th, 2010


Charlie McGrath of Wide Awake News warns that things are going to change after the election - for the worse. While the movement across America to stop an out of control Congress in its tracks will likely lead to Republican victories and control of at least the House, the idea that this will somehow change the economic outlook for the better is conjecture. While our regular readers already understand we’re in a depression, most Americans have no clue of the severity of the problem. According to McGrath, they will know very very soon.

Look at what’s going on around the world. We have riots in Greece, riots in France, we have massive job cuts in England [which are] probably going to lead to social unrest there. It is our time to have austerity flung upon us. That’s what this election is going to be used for.

A week from now when Republicans control the house, maybe the Senate, it really doesn’t matter. Everything’s going to come to a grinding halt. Every talk of extending unemployment benefits is going to come to a grinding halt and austerity is going to be implemented on the American people. Like it or not, it’s coming.

…

This is the plan. We’re going to know that we are in a great depression, very very soon.

…

There’s going to be a lot of people in your life, maybe even yourself, who are facing these difficult, tough decisions when it comes to how to make ends meet…

…The fact is, economic hard times [are] coming your way - like it or not. You have to change your mindset. You have to wrap your head around the fact that it might be your only option to strategically default on your house. It might be your only option to go ahead and file bankruptcy.

…When austerity becomes vogue in this country, it’s going to hit like an eight pound sledgehammer and a lot of people are not going to be able to take it.

…They would have no problem whatsoever walking away from you and letting you wither and die on the vine. You can not have a heart for these people. You need to have a heart for your family. You need to make strategic decisions that benefit yourself and your family. The crime of shifting their debt on to you is complete. It’s time for you to look out for you and your own.

A lot of personal economic decisions in the very near future will be made out of desperation. Congress, be it democrat or republican, cannot stop the coming wave. Whether we print more money a la Paul Krugman and Keynesian economics, or cut spending through austerity measures, the shit is about to hit the fan.

Watch Charlie McGrath:

http://www.youtube.com/watch?v=yL0y5CXyITk&feature=player_embedded

Author: Mac Slavo
Date: October 27th, 2010
Visit the Author's Website: http://www.SHTFplan.com/

It's going to hit like a wrecking ball.

I don't work; I do odd jobs and hustle. And I've been feeling this engineered depression since it started. Y'know what? It's hurting. Too many people out of work-and you look for a niche(s) to fill but most people don't have money.

Now add in all the millions of fat, happy asshole sports fans, fat asshole neocon wannabes, douchebag granola and cum eating lefties... it will get hella ugly!

The only employer might be the government-if we don't go into total collapse, which would actually help because that would at least take down the beast. The worst case scenario is if the government can survive to totally communize this country. God knows we're about there cept for some entrepeneurs and outlaws-guess whose been targeted?

Preps, tools, training and alliances. And a long memory. Make your lists.

Have as many ways of making a living as you can. One sure way of battling hyperinflation or a lack of money is to use another form of currency-no reason why people who know and can rely on one another can't come up with their own script generated by work.

You will of course need a political shield for your free market activities so you might as well get going on taking over a small town politically like the returning GI's from Athens TN did in 1946.

http://www.businessweek.com/ap/financialnews/D9J66Q700.htm

It seems It's spreading.

A lady I have been friends with for along time asked her financial advisor what she put her money in. He told her canned food and ammunition.

When this time comes, the sheeple all around you will bleat in unison for full scale socialism. For more govt power across the board.

Regardless that it is this very same govt's abuse of power that got us here.

They will gladly turn on you in order to gain favor with tyranny.

We are not the same people we were during the last Great Depression. The inner strength, self-reliance and spirit that they possessed is now merely a shadow of what it was then.

That is not only what you can expect, it is what you can count on.

41 Facts About The History Of Central Banks In The United States That Our Children Are No Longer Taught In School
Link to article

Today, most American students don’t even understand what a central bank is, much less that the battle over central banks is one of the most important themes in U.S. history. The truth is that our nation was birthed in the midst of a conflict over taxation and the control of our money. Central banking has played a key role in nearly all of the wars that America has fought. Presidents that resisted the central bankers were shot, while others shamefully caved in to their demands. Our current central bank is called the Federal Reserve and it is about as “federal” as Federal Express is. The truth is that it is a privately-owned financial institution that is designed to ensnare the U.S. government in an endlessly expanding spiral of debt from which there is no escape. The Federal Reserve caused the Great Depression and the Federal Reserve is at the core of our current economic crisis. None of these things is taught to students in America’s schools today.

In 2010, young Americans are taught a sanitized version of American history that doesn’t even make any sense. As with so many things, if you want to know what really happened just follow the money.

The following are 41 facts about the history of central banks in the United States that every American should know….

#1 As a result of the Seven Years War with France, King George III of England was deeply in debt to the central bankers of England.

#2 In an attempt to raise revenue, King George tried to heavily tax the colonies in America.

#3 In 1763, Benjamin Franklin was asked by the Bank of England why the colonies were so prosperous, and this was his response….

“That is simple. In the colonies we issue our own money. It is called Colonial Script. We issue it in proper proportion to the demands of trade and industry to make the products pass easily from the producers to the consumers.

In this manner, creating for ourselves our own paper money, we control its purchasing power, and we have no interest to pay to no one.”

#4 The Currency Act of 1764 ordered the American Colonists to stop printing their own money. Colonial script (the money the colonists were using at the time) was to be exchanged at a two-to-one ratio for “notes” from the Bank of England.

#5 Later, in his autobiography, Benjamin Franklin explained the impact that this currency change had on the colonies….

“In one year, the conditions were so reversed that the era of prosperity ended, and a depression set in, to such an extent that the streets of the Colonies were filled with unemployed.”

#6 In fact, Benjamin Franklin stated unequivocally in his autobiography that the power to issue currency was the primary reason for the Revolutionary War….

“The colonies would gladly have borne the little tax on tea and other matters had it not been that England took away from the colonies their money, which created unemployment and dissatisfaction. The inability of the colonists to get power to issue their own money permanently out of the hands of George III and the international bankers was the prime reason for the Revolutionary War.”

#7 Gouverneur Morris, one of the authors of the U.S. Constitution, solemnly warned us in 1787 that we must not allow the bankers to enslave us….

“The rich will strive to establish their dominion and enslave the rest. They always did. They always will… They will have the same effect here as elsewhere, if we do not, by (the power of) government, keep them in their proper spheres.”

#8 Unfortunately, those warning us about the dangers of a central bank did not prevail. After an aborted attempt to establish a central bank in the 1780s, the First Bank of the United States was established in 1791. Alexander Hamilton (who had close ties to the Rothschild banking family) cut a deal under which he would support the move of the nation’s capital to Washington D.C. in exchange for southern support for the establishment of a central bank.

#9 George Washington signed the bill creating the First Bank of the United States on April 25, 1791. It was given a 20 year charter.

#10 In the first five years of the First Bank of the United States, the U.S. government borrowed 8.2 million dollars and prices rose by 72 percent.




#11 The opponents of central banking were not pleased. In 1798, Thomas Jefferson said the following….



“I wish it were possible to obtain a single amendment to our Constitution – taking from the federal government their power of borrowing.”

#12 In 1811, the charter of the First Bank of the United States was not renewed.

#13 One year later, the War of 1812 erupted. The British and the Americans were at war once again.

#14 In 1814, the British captured and burned Washington D.C., but the Americans subsequently experienced key victories at New York and at New Orleans.

#15 The Treaty of Ghent, officially ending the war, was ratified by the U.S. Senate on February 16th, 1815 and was ratified by the British on February 18th, 1815.

#16 In 1816, another central bank was created. The Second Bank of the United States was established and was given a 20 year charter.

#17 Andrew Jackson, who became president in 1828, was determined to end the power of the central bankers over the United States.

#18 In fact, in 1832, Andrew Jackson’s re-election slogan was “JACKSON and NO BANK!”

#19 On July 10th, 1832 President Jackson said the following about the danger of a central bank….

“It is not our own citizens only who are to receive the bounty of our government. More than eight millions of the stock of this bank are held by foreigners… is there no danger to our liberty and independence in a bank that in its nature has so little to bind it to our country? … Controlling our currency, receiving our public moneys, and holding thousands of our citizens in dependence… would be more formidable and dangerous than a military power of the enemy.”

#20 In 1835, President Jackson completely paid off the U.S. national debt. He is the only U.S. president that has ever been able to accomplish this.

#21 President Jackson vetoed the attempt to renew the charter of the Second Bank of the United States in 1836.

#22 Richard Lawrence attempted to shoot Andrew Jackson, but he survived. It is alleged that Lawrence said that “wealthy people in Europe” had put him up to it.

#23 The Civil War was another opportunity for the central bankers of Europe to get their hooks into America. In fact, it is claimed that Abraham Lincoln actually contacted Rothschild banking interests in Europe in an attempt to finance the war effort. Reportedly, the Rothschilds were demanding very high interest rates and Lincoln balked at paying them.

#24 Instead, Lincoln pushed through the Legal Tender Act of 1862. Under that act, the U.S. government issued $449,338,902 of debt-free money.

#25 This debt-free money was known as “Greenbacks” because of the green ink that was used.

#26 The central bankers of Europe were not pleased. The following quote appeared in the London Times in 1865….

“If this mischievous financial policy, which has its origin in North America, shall become endurated down to a fixture, then that Government will furnish its own money without cost. It will pay off debts and be without debt. It will have all the money necessary to carry on its commerce. It will become prosperous without precedent in the history of the world. The brains, and wealth of all countries will go to North America. That country must be destroyed or it will destroy every monarchy on the globe.”

#27 Abraham Lincoln was shot dead by John Wilkes Booth on April 14th, 1865.

#28 After the Civil War, all money in the United States was created by bankers buying U.S. government bonds in exchange for bank notes.

#29 James A. Garfield became president in 1881, and he was a staunch opponent of the banking powers. In 1881 he said the following….

“Whoever controls the volume of money in our country is absolute master of all industry and commerce…and when you realize that the entire system is very easily controlled, one way or another, by a few powerful men at the top, you will not have to be told how periods of inflation and depression originate.”

#30 President Garfield was shot about two weeks later by Charles J. Guiteau on July 2nd, 1881. He died from medical complications on September 19th, 1881.

#31 In 1906, the U.S. stock market was setting all kinds of records. However, in March 1907 the U.S. stock market absolutely crashed. It is alleged that elite New York bankers were responsible.

#32 In addition, in 1907 J.P. Morgan circulated rumors that a major New York bank had gone bankrupt. This caused a massive run on the banks. In turn, the banks started recalling all of their loans. The panic of 1907 resulted in a congressional investigation that ended up concluding that a central bank was “necessary” so that these kinds of panics would never happen again.

#33 It took a few years, but the international bankers finally got their central bank in 1913.

#34 Congress voted on the Federal Reserve Act on December 22nd, 1913 between the hours of 1:30 AM and 4:30 AM.

#35 A significant portion of Congress was either sleeping at the time or was already at home with their families celebrating the holidays.

#36 The president that signed the law that created the Federal Reserve, Woodrow Wilson, later sounded like he very much regretted the decision when he wrote the following….

“A great industrial nation is controlled by its system of credit. Our system of credit is privately concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men … [W]e have come to be one of the worst ruled, one of the most completely controlled and dominated, governments in the civilized world–no longer a government by free opinion, no longer a government by conviction and the vote of the majority, but a government by the opinion and the duress of small groups of dominant men.”

#37 Between 1921 and 1929 the Federal Reserve increased the U.S. money supply by 62 percent. This was the time known as “The Roaring 20s”.

#38 In addition, highly leveraged “margin loans” became very common during this time period.

#39 In October 1929, the New York bankers started calling in these margin loans on a massive scale. This created the initial crash that launched the Great Depression.

#40 Rather than expand the money supply in response to this crisis, the Federal Reserve really tightened it up.

#41 In fact, it was reported the the U.S. money supply contracted by eight billion dollars between 1929 and 1933. That was an extraordinary amount of money in those days. Over one-third of all U.S. banks went bankrupt. The New York bankers were able to buy up other banks and all kinds of other assets for pennies on the dollar.

But are American students being taught any of this today?

Of course not.

In fact, it is a rare student that can even adequately explain what a central bank is.

We have lost so much of what is important about our history.

And you know what they say – those who forget history are doomed to repeat it.

It is absolutely critical that we educate as many Americans as possible about what is really going on in our financial system and about why we need to make some truly fundamental changes.

So what is your opinion about central banks? Feel free to leave your thoughts in the comments section below….

In the main first page of this thread, it clearly states that our economy was supposed to collapse in late 2010. That passed long ago, and this thread has been dead for quite a while. Is the threat of a total collapse still legitimate? Will it be so bad as a total collapse of society? Because this seems like we're pointing a prediction to one point in time, then it doesn't come true, so we point to another. And another. And so on.

Gold, Silver And Oil Are All Skyrocketing And That Is Bad News For The U.S. Economy


The Economic Collapse
April 7, 2011

The following is one statement that you should get used to seeing: “The price of gold set another record today.” Today, spot gold reached a new all-time record of $1461.91 an ounce before settling back a little bit. Silver is also skyrocketing. At one point today silver hit $39.75 an ounce. It seems inevitable that at some point we are going to be talking about $50 silver. The price of oil is also continuing to relentlessly march upwards. At last check U.S. oil was at about $108 a barrel. All of this is great news for those that are investing in gold, silver and oil, but all of this is also really bad news for the U.S. economy. Why? Well, because when these commodities go up in price it is a sign that the U.S. dollar is dying and that our country is getting closer to economic collapse.

Traditionally, there has been an inverse correlation between the price of gold and the value of the U.S. dollar. Usually when the U.S. dollar goes down, the price of gold goes up.

One of the main reasons why gold has been so strong over the past year is because the U.S. dollar has been rapidly losing value.

So why is the U.S. dollar declining?

Most economists point to all of the quantitative easing that the Federal Reserve has been doing.

So exactly what is quantitative easing?

Well, it is basically like playing Monopoly with someone that reaches under the table and pulls out a bunch of extra money when they are almost broke.

The Federal Reserve has been creating huge amounts of money out of thin air and has been pumping it into the financial system. It is essentially cheating, and it is highly inflationary. The rest of the world has not been amused.

But quantitative easing is not the only issue.

The truth is that whenever the U.S. government goes into more debt, more money is created. The U.S. has been running trillion dollar deficits for several years now, and this has created a lot of new money.

This is another reason why it is so important to get the U.S. government debt situation under control. The Obama administration is projecting that the budget deficit for this fiscal year will be about 1.6 trillion dollars. This is highly inflationary and it will continue to destroy the value of the dollar.

In addition, the rest of the world is beginning to have serious doubts about the sustainability of U.S. government debt. They are starting to lose faith in the U.S. dollar and in U.S. Treasuries.

In fact, investors are losing faith in paper currencies all over the globe. The euro is on the verge of a massive crisis. On Tuesday, Moody’s downgraded Portuguese government debt for the second time in a month. Portugal needs a bailout, but they are far from alone. A half dozen European nations are experiencing a financial meltdown and the European debt crisis could spiral out of control at any moment.

Because of all of this financial instability, investors have been seeking some place safe to put their money.

For many investors, precious metals and commodities have been the answer.

In fact, silver has been doing even better than gold lately. On Wednesday, silver set a new 31-year high for the third day in a row.

People are even starting to talk about the possibility of $50 silver. Most analysts would have considered such talk complete nonsense a year ago.

But now nobody is laughing.

The price of oil is also soaring. Some of that is due to inflation, but not all of it. The truth is that when it comes to oil there are other factors at play.

Unfortunately, a high price for oil is far more damaging to the U.S. economy than a high price for gold is.

The U.S. economy has been designed to use massive amounts of cheap oil to transport massive quantities of goods over vast distances. When the price of oil goes to $100 or $150 a barrel, it fundamentally changes the dynamics of our economic system.

Nobody has ever been able to prove that the U.S. economy can successfully handle a price for oil over $100 for an extended period of time.

Do you remember what happened back in 2008? The price of oil hit a record high in June and then the entire financial system came unglued just a few months later.

The price of oil affects the price of almost everything else. Almost all forms of economic activity use energy. Almost all goods have to be transported a significant distance.

When the price of oil goes too high, some types of economic activity simply become unprofitable. If the price of oil stays this high from now on, there are many businesses across America that will be forced to close.

A high price for oil is also going to hit U.S. consumers really hard. According to AAA, the average price of a gallon of gasoline in the United States is now $3.70.

Many are convinced that the average price of gasoline is going to shatter the all-time record of $4.11 that was set back in July 2008.

So how much did a gallon of gas cost a year ago?

One year ago the average price of a gallon of gasoline was just $2.83.

Over the past 12 months the average price of gasoline has gone up about 30%.

So has your paycheck gone up by 30% over that time?

The truth is that wages have been very stagnant in the United States for a long, long time.

That means that U.S. household budgets are being increasingly stretched. People have to fill up their cars so that they can get to work or to school. Americans can cut back on pleasure driving to save money, but most of the driving that all of us do is to get to places that we have to be.

So if gas costs more that means that consumers are going to have less to spend other places. Consumer spending accounts for approximately 70 percent of the U.S. economy, so any slowdown in U.S. consumer spending would be extremely significant.

Already a substantial percentage of the American people are feeling quite stressed about gas prices.

According to a recent Associated Press-GfK poll, approximately two-thirds of the American people believe that rising gasoline prices will cause significant hardship for their families over the next six months.

We are heading for some really difficult economic times. As I wrote about recently, this economy has millions of Americans feeling depressed, but that is not the appropriate response.

Rather, once we understand how bad our economic problems are we should feel empowered because then we can start focusing on real solutions.

And somebody really needs to start focusing on solutions because panic is starting to abound. Many top corporate insiders are selling off stock like there is no tomorrow. The biggest bond fund in the world, PIMCO, has been getting rid of all of their U.S. Treasuries. When Wall Street big shots start freaking out you know that the hour is late.

It certainly doesn’t help that the Middle East is in a state of chaos and that theJapanese economy is falling apart as a result of the recent disasters.

In these uncertain times investors are seeking something safe. They are turning to real “global currencies” such as gold, silver and oil. Paper currencies are rapidly losing favor and rampant inflation is on the horizon.

So where do all of you think that gold, silver and oil are going? Feel free to leave a comment with your opinion below…

Here is what was said... Economic collapse is not necessarily some sudden event that plunges the world into a literal stone age over night. It's a process that occurs over a period of time and that process has been ongoing for several years. It will progressively get worse until your money becomes so worthless that you can't afford anything.


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Ron Paul: ‘New World Order’ Using Financial Crisis, Wars To Enhance Globalism


Congressman adamant “one worlders” will fall

Steve Watson
Prisonplanet.com
April 6, 2011

Congressman Ron Paul, icon to liberty lovers the world over, sent a stark message this week to ruling elite “internationalists” attempting to expand globalism via the Western military industrial complex – you will fail.

Speaking on the nationally syndicated Alex Jones Show, Paul expressed his concern that a deeply malign form of globalism is being promoted and expanded on the back of international crises, namely the political upheaval in the middle east and north Africa, coupled with ongoing financial meltdown.

“The new world order people see it as an opportunity to move one step forward.” Paul stated, alluding to an infamous description of the current US led international coalition of powers.

“Bush senior bragged about that, remember he didn’t want to go to Congress, he came and got a token approval in 1990/91 for the Persian Gulf war, but he got his orders from the UN, he didn’t need to go to Congress… That was the first time I heard a president use the words ‘new world order’, anyone who used that had to be a conspiracy nut, but Bush was saying this is what we need to do for the ‘new world order’.” Paul explained.

“They go to war under NATO and the UN, not by the Congress,” Paul added. “But ultimately the big one is to control the money, so they are making their plans to have a world wide fiat currency through the IMF/World Bank operations.”

As reported in the Financial Times and elsewhere recently, the IMF strongly advocates the eventual introduction of a global currency, called the “bancor”, based on its own synthetic paper currency special drawing rights (SDRs), claiming it would “stabilise” the international monetary system.

“The new world order is certainly looking at this monetary crisis, we want the Constitution, sound money, gold and silver, but at the same time the internationalists are planning for their international fiat currency.” Congressman Paul stated.

Paul, also a member of the Joint Economic Committee, the Committee on Financial Services and the Chairman of the House Financial Services Subcommittee on Domestic Monetary Policy, believes that sound monetary policy will eventually be recognized as the solution to the financial crisis, rather than a system of global regulation and global currency being pushed by such unaccountable global bodies as the IMF and World Bank.

“They have a long way to go because what they advocate is still fake money and they have to defy the market place.” Paul said. “They may make the attempt and they may be able to cause a lot of harm in the meantime, but ultimately sound money wins out. Hopefully we do our job and liberty wins out over the tyrants.”

“The bankruptcy will bring us to our knees, but lets just hope we can put it back together in a lot better shape than we have it now.” the Congressman added.

Paul, who is also a serving member on the House Foreign Affairs Committee, is adamant too that despite the recent military activity in Libya and elsewhere, ultimately, the move to expand the ‘new world order’ brand of globalism by force is destined to fail.

“It’s not going to work for them, no matter how hard they try and how many temporary military victories they have, it’s going to be a failed system.” he said.

“It will serve its purpose in many ways by bringing us to our knees and some of them like the opportunity, they don’t let emergencies go to waste, they take advantage of it and that’s why they think they can advance a new world order and one world government under these conditions.” the Congressman added.

“I think our message is spreading and I hope we are going to be very good competitors with these one worlders.” Paul concluded.

During the interview Paul also gave the strongest indication yet that he will announce a presidential run for 2012 within the next few weeks.

“We’re getting awfully close,” Paul explained, “and there are just a few other things I have to iron out personally to make my final decision.”

Ok. Thank you for the explanation ConSigCor.