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The First Great Depression: Blow By Blow, From The BIS, And How It Mirrors Our Ongoing Second Great Depression

Tyler Durden's picture


(This is a repost from a year ago. As the events over the past 12 months have progressed very much as the ongoing second great depression would have predicted, we republish this critical history lesson for all readers and remind everyone that history always rhymes. Pay particular attention to the fate of hard assets as the confidence in the entire system evaporated)

After surviving the start of the Second Great Depression, and living
in its first great bear market bounce/short squeeze, where now all the
attention is focused on a collapsing Europe, many could be wondering
how, if at all, it would have been different to have lived through the
first Great Depression. Luckily, courtesy of the recent release of the
BIS's full annual reports, history buffs can now replay, year by year,
the events in world capital markets from 1931 onward. We have put
particular emphasis on the dark days of the 1930s. Below we present the
first several such years as seen from the perspective of the BIS. Note
the endless similarities - in fact one could say the only difference
between then and now is the lack of "liquidity providing" algos (soon,
there will be an iPad app for that) to front run slow and stupid
retail/pension/mutual fund money. Pay particular attention to the role
of gold in the crisis period, the amusing reference to FDR's
confiscation of gold in 1933, and how the mood of insecured optimism
shifts to one of endless gloom, and ends, as everyone knows, with World
War 2.


year under review has been one of dramatic occurrences in the whole
field of international finance, credit, monetary stability and capital
movements, both public and private. The record of this year of
unparalleled world-wide disturbance reflects itself in the progress,
resources and activities of the Bank, which have been intimately
affected by each succeeding episode, in all of which the Bank was
promptly called upon to play a rôle, as was but natural for an
international institution the statutory object of which is "to promote
the cooperation of central banks and to provide additional facilities
for international financial operations, and to act as trustee or agent
in regard to international financial settlements", whose "operations for
its own account shall only be carried out in currencies which satisfy
the practical requirements of the gold or gold exchange standard".

the second month of the fiscal year, the collapse of the
Oesterreichische Credit-Anstalt, with its ramifications throughout
Central Europe, called for immediate aid to the National Bank of
Austria. In the third month of the fiscal year, there was announced the
so-called "Hoover moratorium", which materially changed the scope of the
operationsof the Bank and the magnitude of the funds at its disposal in
its capacity as Trustee for international financial settlements between
Governments. In the same month the banking difficulties in Germany,
precipitated by wholesale withdrawals of short-term credit, and the
pressure upon the Hungarian exchange, necessitated the organization of
central bank aid to the Reichsbank and to the National Bank of Hungary.

the fourth month of the fiscal year, the London International
Conference declared that "excessive withdrawals of capital from Germany"
had "created an acute financial crisis", and invited the Bank for
International Settlements to set up a Committee to inquire into the
credit needs of Germany.
In the fifth month, this Committee
urged "most earnestly upon all Governments concerned that they lose no
time in taking the necessary measures for bringing about such conditions
as will allow financial operations to bring to Germany — and thereby to
the world — sorely-needed assistance".

In the sixth month
of the fiscal year, the world was shocked by the sudden fall of
sterling, which was almost immediately followed by the suspension of the
gold or gold exchange standard by six other nations.
occurrences still further shattered what was left of confidence and
forthwith caused a strain on the reserves of nearly all central banks of
the world, including the Federal Reserve System. The necessity for the
employment by central banks of their reserves in turn placed a strain
upon the Bank for International Settlements, in its capacity as the
depositary for a substantial portion of the reserves of many European
banks of issue, but the large withdrawals in September were met without
decreasing its high degree of liquidity.

In the ninth month of the
fiscal year, there gathered at Basle the Special Advisory Committee,
convoked by the Bank because of the declaration of the German Government
that it had "come to the conclusion in good faith that Germany's
exchange and economic life may be seriously endangered by the transfer
in part or in full of the postponable part of the annuities". In the
succeeding months of the fiscal year the world financial system
continued to undergo heavier and heavier pressure and the condition of
Central and Eastern Europe and of its central banks, members of the Bank
for International Settlements, failed to ameliorate despite a series of
"standstill" agreements, currency restrictions, rationing of imports
and foreign devisen, and other artificial expedients.


the whole, 1932 may be styled a year of adaptation to changed
conditions prevailing in the economic and monetary situation and one of
some definite constructive effort. The most important constructive
measures were taken or initiated at two periods — the first in February
and the second in the last half of June and beginning of July. It was in
February that the Bank of England, after the repayment of more than
half of the large currency credits taken up in the previous summer,
lowered its discount rate from 6 to 5 per cent, and thereby gave the
signal to the downward movement of interest rates which was continued
all through the year in most parts of the world. In the same month the
German Government put into effect a plan for the thorough reorganisation
of the large German banks, which involved a considerable writing off of
assets and the supply of new capital with the aid of the Treasury and,
indirectly, of the Reichsbank. This reorganisation permitted the
re-opening of the German Stock Exchange, which had been closed for seven
months. In the United States the Glass-Steagall Bill was adopted on
February 27, giving greater freedom to the Federal Reserve Banks and
enabling them to alleviate the pressure exerted by internal currency
hoarding and withdrawals of gold.

On the basis of the provisions
of this new act, the Reserve Banks purchased Government securities in
the open market to an amount which in June reached $ 1,100 million, a
sum then sufficient not only to counterbalance withdrawals and hoarding,
but also to provide member banks with substantial excess reserves. At
about the same time two further events of outstanding importance took
place. The first was the conversion of more than & 2,000 million of
the public debt of Great Britain from a 5 per cent on to a 3% per cent
basis, which was announced in the second half of June and met with
immediate response; such a measure was welcomed not only because it
helped to alleviate the British budget, but also for the downward
influence which it exercised on long-term interest rates. Further, the
successful outcome of the Lausanne Conference in July, the value of
which it is hard to overestimate, revealed willingness by the Reparation
creditors — in the first place France — to make very large concessions
and it meant the elimination of one of the most serious political
hindrances to economic recovery.

These are outstanding measures.
But attention must not be concentrated on them alone. A close
examination of developments would show that the large volume of
international credits was further reduced, that strenuous efforts were
made in many branches of public and private economy to balance revenue
and expenditure, to establish equilibrium between costs and prices, to
render assets more liquid, to reach agreed arrangements for postponing
or scaling down debt payments, to overcome the difficulties resulting
from the liquidity crisis and to maintain control of the currency
position, even when foreign exchange restrictions were, in the interests
of trade, gradually relaxed. One  marked feature of the period was the unparalleled volume of gold movements.

the international movement of goods registered an unprecedented decline
in 1932, gold movements reached proportions never before experienced.

the year the total gold production of the world attained the high
figure of $ 495 million, or 2,559 million Swiss francs, thereby
establishing a new record by surpassing the production of the previous
peak year, 1915, by 139 million Swiss francs, and that of 1931 by 184
million. While it is to be expected that gold production should rise in a
period of sharply falling prices and plentiful labour supply, the
increase has exceeded even the most optimistic forecasts. It has been
most marked in the Union of South Africa and Canada, by far the largest
percentage increase occurring in the latter country. Production in the
United States, after having declined fairly steadily from 1915 to 1929,
has risen again and at a progressively greater rate during each of the
past three years.

the gold producing countries the influence of the new gold was
particularly helpful in Canada. Since the departure of sterling from the
gold standard, and the simultaneous depreciation of the Canadian
dollar, the gold production of the Dominion has been bought by the
Government at the prevailing market rate. The large production of 1932, $
63 million at par, gave to the producing companies approximately $ 70
million in Canadian currency, and greatly aided the Government in
meeting its maturing obligations punctually and in supporting the
exchange. In the Union of South Africa the production of gold made
possible the maintenance of the gold standard until the last weekof 1932
when, however, the large outflow of funds caused by speculation
depleted the reserves and forced the country to suspend the gold
standard. Under an agreement with the mines the South African Reserve
Bank had up to that time purchased the newly produced gold at par, which
enabled the Bank within a short space of time to recover the losses it
incurred through the depreciation of sterling and to reconstitute its
capital and reserves.

Whereas production has increased, the demand
for gold by the arts has fallen to a very low level and, even more
important, India and China, instead of absorbing a substantial part of
the newly-mined gold, have continued to export gold previously hoarded.
In the three months of October, November and December 1931, gold to the
value of nearly 500 million Swiss francs was exported from India; during
1932, Indian gold exports amounted to a little more than 1,000 million
Swiss francs, a sum not greatly inferior to the value of South African
production, which was 1,238 million Swiss francs. The great volume of
"new" gold which became available during 1932 from the mines and from
India had its effect not only upon those countries in which it
originated but also upon those to which it passed. The entire Canadian
production was exported directly to the United States, but that of South
Africa was, as usual, sold in London. In addition, almost 78 per cent
of the gold exported from India was sold in London (approximately 19 per
cent being shipped directly to the United Statesand about 3 per cent
disposed of in the Netherlands and France). The bulk of the South
African and Indian gold offered in London was sold against gold
currencies, usually dollars or francs, depending on whichever was the
stronger. In the case of the South African sales a large part, and in
the case of the Indian sales practically all, of the proceeds received
in these gold currencies was thereafter sold for sterling.

In the
following table an attempt has been made to indicate for each quarter of
1932 the amount of gold derived from production and from India and
China, the amount of gold used by the arts, as well as the increase or
decrease of gold in the reserves of Central Banks and Governments, in
order to obtain a rough estimate of the amounts hoarded and de-hoarded
in the different periods:

total increase in the monetary gold reserves of Central Banks and
Governments for 1932 was 3,125 million Swiss francs. This means that, in
spite of the hoarding which took place, monetary reserves received new
gold during the year in an amount 22 per cent greater than the total
gold production of the record year in the history of the world. And
although European Central Banks during the first half of 1932 converted
more than $ 700 million of their dollar holdings into gold, the gold
reserves of the United States were only $ 6 million smaller at the end
of the year than they had been at the beginning.
But in the first
quarter of 1933 the anxiety caused by the banking crisis led to a
reduction in American gold reserves, later, however, to be replenished as a result of a series of anti-hoarding measures. [read: executive order 6102]


twelve months have been striking ones in the financial history of the
modern world. They have witnessed the dramatic episodes in the United
States of America, culminating first in the abandonment of the gold
standard, with its worldwide economic and monetary repercussions, and
then, after a series of novel currency experiments, and a profound
change in the banking and central banking structure, in the devaluation
of the dollar and a qualified return to the standard abandoned. They
have witnessed the high hopes aroused on every continent by the
convocation of the London Monetary and Economic Conference, which was to
find joint solutions for financial ills and economic
and to prepare the way for a reconstituted international monetary system
— hopes which were dashed to the ground when this vast assembly met and
promptly discovered that it was either in disaccord on fundamentals
(especially as regards early currency stabilisation) or, if in agreement
on some fundamentals (for example on the economic side), in disharmony
as to the ways and means of reaching the agreed objectives. They
have witnessed, as a consequence, the formation, in the monetary field,
of the "gold bloc", determined to preserve the status quo in their
monetary system based on the classic gold standard, and in the financial
and economic field, a retreat from the direction of internationalism
toward a self-reliant, self-contained but ominous nationalism.
international financial and monetary relations the twelve months have
seen a series of retrograde developments — more moratoria, more 
transfer impediments, more artificial clearings, more gold hoarding than
during any year on record, more conversion of foreign balances and
their repatriation into the home currency, or in gold, by private and
central banks, an almost complete cessation of new long-term lending
abroad and a further limitation or reduction of the volume of short-term


four years will have passed since the financial crisis broke out, and
still the world suffers without relief from the unrest and the
uncertainties caused by moving currencies.
The consequent
difficulty encountered by the world's trade is reflected everywhere in
the large percentage of unemployment in those branches of national
industry which are largely producing for foreign demand. In many
countries, national endeavor has given an impetus to domestic affairs,
with visible results, but this whole stimulated development threatens to
become top-heavy as long as an expansionist policy at home is limited
by restrictive policies, internationally. The daily conduct of
every business and of every financial transaction which touches more
than one currency area is rendered difficult or impossible by the
varying exchange values of so many of the world's currencies,
particularly of some of the leading ones.
An indication of the
surprising extent of these inhibiting variations is contained in Chapter
II. Tariff changes, quotas, clearings, exchange restrictions,
compensation agreements and the like, all of which tend to throttle the
international exchange of goods, of services and of capital, are the
inevitable concomitants of the chaotic monetary conditions which
prevail. During the past twelve months, the disorder has become
intensified through, among other factors, the further fall, measured in
gold, of sterling and the currencies responsive thereto, the devaluation
of the belga, the silver policy of the United States, and the
continuous abnormal attraction of gold to the American market.


years have passed since in the course of 1929 the great depression
began which still holds large parts of the world in its grip. It
might have been expected that in the period which has elapsed the
depressive forces would have spent themselves and general prosperity
would have returned. But the depression of these seven lean years has
not been merely a slump of the pre-war order.
Its background
was different — it supervened upon an economic and financial situation
still suffering from the dislocation caused by a world war; and, with
the volume of world unemployment above 30 millions, it has grown into
something vaster than any pre-war depression. In the succession of
events it is possible to recognize four major disturbances:

Firstly, there was the ordinary downward trend of business. Conforming
to type, this was characterized by reduced sales, accumulation of
stocks and decline in output, particularly in branches such as the iron
and steel industries which produce capital goods or, in general, provide
industrial, agricultural, trade and transport equipment.

Secondly, there was a widespread fall in prices of primary products —both foodstuffs and industrial raw materials. This
put a particularly heavy strain on the balances of payments of a number
of overseas countries and, within a short time, effectively arrested
the flow of capital in their direction, whether in the form of loans or
of new investments.

Thirdly, in the late spring and summer of 1931 there came the banking crisis in Austria and Germany. Massive
withdrawals of funds were followed by a series of organized attempts to
stem the tide through the granting of emergency credits and, when these
attempts proved unsuccessful, by the introduction of moratoria,
transfer provisions and exchange restrictions, with the result that, not
only did foreign credits remaining in the countries affected become
frozen but ordinary trade was hampered by new and formidable fetters.

in the autumn of the same year there followed the depreciation of
sterling and of a number of other currencies. New elements of
uncertainty were thus added to the economic and financial situation and
strong downward pressure was exerted on prices quoted on a gold basis in
the world markets. A period of monetary changes had begun which within
two years was also to involve the United States dollar.


In the year which has passed since the last General Meeting great monetary changes have occurred. In
France, a new economic and financial policy was adopted in the spring
of 1936, and in the early autumn a decision was taken to readjust the
value of the French currency. Ori 25th September 1936 simultaneous
declarations were issued by the French, British and United States
Governments in which the three governments declared their intention to
continue to use appropriate available resources so as to avoid as far as
possible any disturbance of the basis of international exchange
resulting from the proposed readjustment.
During the same
week-end a decision was taken in Berne to change the value of the Swiss
franc and at The Hague an embargo was placed on the export of gold ;
shortly afterwards the Italian authorities readjusted the lira to a new
gold basis, while the Chechoslovakian crown was further devalued in
relation to gold and the Latvian currency was devalued  and attached to

The technical measures taken in the various countries
and the arrangements agreed upon by the different monetary authorities
will be referred to later in this report. Here it may be noted that the
changes in the values of thé currencies concerned were carried out with a
minimum of disturbance to the foreign commodity and capital markets and
that no setback was caused to the upward trend of world affairs.

heavy burden of debts both domestic and foreign was also in other ways
an obstacle to economic recovery, especially as the debt structure
inherited from the war was augmented by extensive international
borrowing in the 'twenties both on long and short-term account. In some
countries the main difficulties were caused by an excessive volume of
private indebtedness, e. g. mortgage debts of farming communities, in
other countries by internal government- indebtedness weighing heavily on
the budgets, and again in others mainly by foreign liabilities which
were a charge on balances of payments and "on monetary reserves.

progress has been made during the depression in scaling down the debt
structure. In addition to the effects of currency depreciations, the
burden of domestic debts has been alleviated by conversions, and foreign
indebtedness by repayments, repatriations and arrangements of different
kinds. The volume of international short-term indebtedness has thus
been brought down by about one-third in terms of sterling (a currency in
itself depreciated by almost 40 per cent.) and by still more in terms
of gold. Long-term indebtedness has not been reduced to the same extent,
but there has been a very important movement in the repatriation and
redemption of foreign securities, especially from the United States and
Great Britain.


It is not difficult to indicate the reasons why business last year passed through periods of great anxiety. In
the opening months of 1938 repercussions of the abrupt decline in
American industrial activity that had begun in the previousautumn were
felt all over the world, particularly in the export trade.

This decline proved the more depressing as it came at a time when there
were high hopes of more sustained prosperity in the United States. The
general weakness in prices of primary products, a consequence of reduced
American demand, and the downward tendency of many other prices called
for reductions in costs and other adjustments, which generally met with
resistance from interested parties. In countries of the sterling area,
which had experienced almost uninterrupted expansion since the autumn of
1932, conditions were ripe for a slackening of internal activity.

this situation were added exceptional events of a political character,
which dealt rude shocks to business and left in their wake a level of
armaments and military preparation never before witnessed in times of
peace. Among the most striking signs of the political
uncertainty was the pressure on sterling caused by mass movements of
funds which, with other factors, added $1,500 million to the American
gold stocks in the five months from August to December 1938.
harmful effects were found in the restraints suffered by ordinary
business, as initiative was cramped and the will to make new investment
weakened. Filling the gap by government orders for armaments and other
purposes for the time being helped to sustain employment but necessarily
diverted productive power from the pursuit of normal trade and
especially tended to impair the export capacity of the countries most
deeply involved.

Under the strain of almost uninterrupted
political tension, bringing with it general uncertainty as to the
business outlook, continuous capital flight from Europe and growing
armament expenditure in all countries, the economic development of the
world does not, however, show the picture of colourless gloom that one
would expect.
It lacks, of course, stability and nowhere
inspires confidence in the strength of the more favourable tendencies
that are at work. The state of the world is feverish rather than healthy; and whatever recovery may be seen is anything but steadfast, since it is  dependent on the use of stimulants on the one hand and interrupted by grave disturbances on the other.


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Tue, 06/14/2011 - 17:04 | 1369009 hugovanderbubble
hugovanderbubble's picture

Anyone see a potential paralelism between those years and current ones...?

Back to hard major collateral

Good bye happy 20´s... (Lehman Crash 2008).....1929 wall of worries...




Tue, 06/14/2011 - 18:18 | 1369176 LongBalls
LongBalls's picture

Pass the Pepto please. Thanks.

Tue, 06/14/2011 - 21:52 | 1369563 BlackholeDivestment
BlackholeDivestment's picture

                          plot   plop






                      what a relief it is 

                         R O L A I D S  

                            Roll AIDS

          Mr Robinson neighborhood hit with QE2

                   What Japan going ta do?

     Bitchez! Don't drink the municipal TAP water

              Pepto don't workout TEPCO perks

                   Watchout for those Jerks 

                They up to something

Something big is timed to go ofF, it looks like 2012 Lucifer Rising.

Tue, 06/14/2011 - 23:29 | 1369890 markmotive
markmotive's picture

While we're creatively slamming the powers that be...


Here's a classic on 'how the financial system works':

Wed, 06/15/2011 - 05:27 | 1370238 Michael
Michael's picture

Dr Ron Paul completes me.

I'm sorry, I just had to say that.

Wed, 06/15/2011 - 05:52 | 1370256 Michael
Michael's picture

I hope Nichole is feeling OK today.

She had her bubble busted yesterday when she heard her puppy Facebook was losing users month over month to the tune of millions of users.

You'd think her puppied died a violent death while she was watching, while she heard the news for the first time.

Do your job Nichole!

I'm watching you.



Wed, 06/15/2011 - 06:12 | 1370267 Michael
Michael's picture
Michael says:

Your comment is awaiting moderation.

June 15, 2011 at 1:18 am

Boy, I thumped this issue hard during the early days of the Climategate scandal on this WUWT site.
I rode this subject like a, well here I should not say that word.
I posted may articles such as this one that gave me a heads up on the influence of our sun and what it was doing;
Solar Activity And Climate Change: New Sun-Watching Satellite To Monitor Sunlight Fluctuations
I prayed the caretakers of the universe would give us an extended solar minimum to teach those who needed it what is ultimately in charge of the Earth’s climate. I have not been disappointed. I monitor the sunspot activity every day. Very quiet indeed.

Wed, 06/15/2011 - 19:58 | 1373078 BlackholeDivestment
BlackholeDivestment's picture

...smells like roses in the room, but, they are still in the garden. ...must be an open window.

The Black Hole of Mr. Shadow's ''climate change'' offer is that of the accuser. The only way to keep the Sun calm is, for that fallen (Lucifer/all liars) angel's offer of temptation to be rejected. Fukushima blindness is in play, through the lukewarm waters of the Euphrates, now made bitter  by the fallen star.

It's all about ''the image'' of the bottomless pit and the claim of dominion. The people are fallen, as with the angels, but, the revelation of the risen Truth of our Father in Christ is the image that falls away first, as the line in the sand, the seal upon this last generation. Silence in Heaven, the Sun taking a lunch break, well, that will be ''changed'' by the beast rising as 2112 opens the star gate revelation in time with prophecy. The host, or the people, are the image of the angel of the whirlwind ''climate change'' but, that is just the evil twist portion of the parable standing as the accuser, whom has offered temptation, knowing you shall surely die. Deception claims all flesh, if it were possible, but, for the sake of the elect, this last generation is cut short. Watch.

Fear not, stand fast, do no harm, go with our Father in Christ.

Tue, 06/14/2011 - 19:15 | 1369294 BlackholeDivestment
BlackholeDivestment's picture

    QE3            Parabolic

     THE     ''Federal'' ''Reserve''

    MARK       Pair of LIESman



                    And            The   

                  RIDER         HORSE


Tue, 06/14/2011 - 22:02 | 1369685 Fedophile
Fedophile's picture



Yeah and just multiply all numbers by 1,500 (BIS) or more like 6,000 (SGS)

Wed, 06/15/2011 - 00:40 | 1369983 CompassionateFascist
CompassionateFascist's picture

Not at all. Then, the US had a solid industrial base to provide a floor to the Crash. All gone now, nothing out there but smoke, mirrors, and debt. USA = Universal Ponzi. This Collapse is going to be exponentially worse, leading to what Toynbee called a "Time of Troubles". Not one in ten people posting/commenting on this site are going to be among the living when it ends.  

Wed, 06/15/2011 - 02:03 | 1370099 Ben Fleeced
Ben Fleeced's picture



Fixeed it

Wed, 06/15/2011 - 04:09 | 1370194 BlackholeDivestment
BlackholeDivestment's picture

Interesting dates, to be sure. Looking at them it struck me, like a hand on a clock. There are many ''ironic''? images held within the market timing that remind me of the pyramid timing, connected to the same banker occult crowd that built the rise and fall of their own corrupt house of cards and set the Cornerstone(s) timed with the Fallen Stars, once above and now their measure has fallen below, now claiming dominion on Earth. They know their time is short, 2112 is designed inside the center of the Great Pyramid, which is buildt on the mark of the beast, the point within the circle. That stupid pyramid on the world reserve fiat currency of debt has a pyramid on it because it's new world order new age mark of the beast market corruption timed with the U.N.Sustainable Agenda.

just so many wild links

Wed, 06/15/2011 - 02:03 | 1370100 Ben Fleeced
Ben Fleeced's picture



Fixed it

Tue, 06/14/2011 - 17:05 | 1369015 redpill
redpill's picture

"Welcome to the Recovery"


--Timothy Franz Geithner


Tue, 06/14/2011 - 17:25 | 1369052 hugovanderbubble
hugovanderbubble's picture

Geithner is commiting fraud each day is his life, but who cares about ethics and laws...

What a fraud for the US to have a Guy like Timothy rolling and ruling the game...



Wed, 06/15/2011 - 00:34 | 1369976 JW n FL
JW n FL's picture

No Taxes Collected Jobs Shipped to China 50K a Month since 2000 and now Cuts to Real Working Americans


For a DECADE! We have shipped 50,000 Jobs a MONTH! To China! (alone)


For the majority of that time we have given Tax Breaks to Corporations to Move those Jobs.


For the better part of a DECADE! We have undermined our own Tax Base!


For Longer! Than a Decade we have allowed the Largest Money Makers, with the Largest Lobby’s to Pay almost NO! Fucking Taxes!


America is NOT! a Country that has no social safety net or that is supposed to be OK! With being a Police State.


If any Citizens want to live in an America with no Social Safety Nets!

If any Citizens want to live in an America that is a Police State!

Should get the fuck out and go live in one of the MANY! Shit Hole Countries that are already living under those conditions!


America is Supposed to be better than those 3rd World Countries!

But the top 1% of the 1% keep spending Lobby monies and Buying T.V. ad time to realize a 3 rd World America!


Most of you buy Gold and Silver to insulate yourselves from an uncomfortable life style! I buy Gold and Silver so that in the event of Social un-rest that I may be able to pay for / feed an army to Rout by the Almighty God! You Wanna Be Tight Fisted, Treasonist Scum from My Country! I pray for the chance to rid this once Great Country of the scum that is the real drag that keeps hungry children hungry! God have mercy on you because I will NOT!


All of you that support people / corporations NOT paying their fair share!

All of you that support a 3rd World Living Standard for any American for ANY REASON!

I want to see you Hanged on the White House Lawn!

      Top 10 corporations which paid no taxes

Here is Sen. Sanders’ list of the 10 worst corporate income tax avoiders:

1) Exxon Mobil made $19 billion in profits in 2009. Exxon not only paid no federal income taxes, it actually received a $156 million rebate from the IRS, according to its SEC filings. (Source: Exxon Mobil’s 2009 shareholder report filed with the SEC here.)

2) Bank of America received a $1.9 billion tax refund from the IRS last year, although it made $4.4 billion in profits and received a bailout from the Federal Reserve and the Treasury Department of nearly $1 trillion. (Source: here, ProPublica here and Treasury here.)

3) General Electric made $26 billion in profits in the United States over the past five years and, thanks to clever use of loopholes, paid no taxes.(Source: Citizens for Tax Justice here and The New York Times here. Note: despite rumors to the contrary, the Times has stood by its story.)

4) Chevron received a $19 million refund from the IRS last year after it made $10 billion in profits in 2009. (Source: See 2009 Chevron annual report here. Note 15 on page FS-46 of this report shows a U.S. federal income tax liability of $128 million, but that it was able to defer $147 million for a U.S. federal income tax liability of negative $19 million.)

5) Boeing, which received a $30 billion contract from the Pentagon to build 179 airborne tankers, got a $124 million refund from the IRS last year. (Source: Paul Buchheit, professor, DePaul University, here and Citizens for Tax Justice here.)

6) Valero Energy, the 25th largest company in America with $68 billion in sales last year, received a $157 million tax refund check from the IRS and, over the past three years, received a $134 million tax break from the oil and gas manufacturing tax deduction. (Source: the company’s 2009 annual report, pg. 112, here.)

7) Goldman Sachs in 2008 only paid 1.1 percent of its income in taxes even though it earned a profit of $2.3 billion and received an almost $800 billion from the Federal Reserve and U.S. Treasury Department. (Source: Bloomberg News here, ProPublica here, Treasury Department here.)

8) Citigroup last year made more than $4 billion in profits but paid no federal income taxes. It received a $2.5 trillion bailout from the Federal Reserve and U.S. Treasury. (Source: Paul Buchheit, professor, DePaul University, here, ProPublica here, Treasury Department here.)

9) ConocoPhillips, the fifth largest oil company in the United States, made $16 billion in profits from 2006 through 2009, but received $451 million in tax breaks through the oil and gas manufacturing deduction. (Sources: Profits can be found here. The deduction can be found on the company’s 2010 SEC 10-K report to shareholders on 2009 finances, pg. 127, here.)

10) Carnival Cruise Lines made more than $11 billion in profits over the past five years, but its federal income tax rate during those years was just 1.1 percent. (Source: The New York Times here.)




‘Dutch Sandwich’ saves Google billions in taxes Internet giant uses complex structure to keep its overseas tax rate at 2.4%





Microsoft’s purchase of Skype for $8.5 billion provides a perfect illustration of why adopting a true worldwide corporate income tax system is critical to our economic future.  

According to the Wall Street Journal, the cash for Microsoft’s purchase of Skype (a Luxembourg-based company) will come out of its $42 billion in liquid assets held in foreign subsidiaries.

Because it is purchasing a foreign company with its overseas assets, Microsoft can avoid paying any U.S. tax that would be due if it had repatriated foreign earnings in order to purchase a US company for the same amount. Based on the company's effective foreign income tax rate disclosed in their most recent SEC filings, a repatriation of $8.5 billion dollars would cost Microsoft somewhere in the neighborhood of $1.1 billion in U.S. tax.

As a Forbes commentator opines, the Microsoft-Skype deal demonstrates the harmful incentive created in our current system that encourages companies to invest in overseas companies rather than domestic ones. The fear is that this deal may just be “a harbinger of things to come.”


Republicans to roll out new tax-cut proposal: WSJ
25 May 2011, by Michael Kitchen - Los Angeles (MarketWatch)

Republicans in the U.S. House of Representatives are set to unveil a new economic proposal Thursday that will cut taxes for multinational corporations and lower other tax rates.

Wed, 06/15/2011 - 02:06 | 1370101 Ben Fleeced
Ben Fleeced's picture

Persistance = posting the same shit overandoverandoverandoverandoverbecuseyouaresooosuperioroverandoverandoverandoverandoverandover.

Wed, 06/15/2011 - 04:16 | 1370198 Gandalf6900
Gandalf6900's picture


Thats cause the Federal Income Tax is a fraud, not in the constitution my friend, not LEGAL my friend, and they know it, and the gov can't fool them, but it can fool you dummies...keep buying your SUV's guys, keep buying your flat screen tv's guys, keep hauling shit in your garages and feeding junk to your kids, I'm laughing but will you be laughing in the near future....

Wed, 06/15/2011 - 07:47 | 1370368 blindfaith
blindfaith's picture


We financed our own down fall, and continue to do so right this very minute with special treatment for the few.

The speaking of targeted 'entitlements' as the 'cause and cure' is selective labeling.  Conveniently left out of the ruckus is, special tax treatment to corporations, ultra rich, hedge fund and banker bonuses treated as long term cap gains, etc., etc., etc. 

All the tax breaks since 2000 has done nothing but put a knife in small businesses heart and choked the average American to his knees.

Tue, 06/14/2011 - 17:49 | 1369117 Hugh G Rection
Hugh G Rection's picture

I like the sequel better.

Tue, 06/14/2011 - 17:09 | 1369021 SilverDoctors
SilverDoctors's picture

Registered silver inventory on the COMEX drops below 28 million ounces.
Biggest deflation we have today is not in dollars, its in silver supply!

Tue, 06/14/2011 - 18:42 | 1369209 jdrose1985
jdrose1985's picture

Jason Hommel, is that you?

Tue, 06/14/2011 - 18:41 | 1369220 jomama
jomama's picture

where have we heard that one before...

Tue, 06/14/2011 - 17:12 | 1369028 Highrev
Highrev's picture

The news flow (the real news flow that is) is just too negative for where we are price wise.

This is news flow for panic bottoms.

The S&P is still at 1287 +.

The CBOE put/call hitting bearish sentiment extremes.

Man, if this is all the lower we get, the bears are in deep shit.


Tue, 06/14/2011 - 17:20 | 1369034 dwdollar
dwdollar's picture

Where was the volume today?

Tue, 06/14/2011 - 17:28 | 1369057 hugovanderbubble
hugovanderbubble's picture

who cares about Volume for the superalgos? markets completly uncorrelated, no real flows, we are trading lies.


"quién será el primero en apretar el botón de vender"?

whos gonna be the first to press the sell key?

Tue, 06/14/2011 - 17:40 | 1369088 mynhair
mynhair's picture

See T&S for the Roach Motel at 10:25am.  500 shares @ 129.98 followed by 100 @129.02, then 6000 @ 129.22.  It went nuts for a minute like that.

Wed, 06/15/2011 - 02:12 | 1370110 Ben Fleeced
Ben Fleeced's picture

I am gault. 6/14/2011.


Tue, 06/14/2011 - 19:09 | 1369284 Greeny
Greeny's picture

Market volumes are usually low during summertime

no need for conspiracy theories here.

Tue, 06/14/2011 - 20:18 | 1369412 JohnG
JohnG's picture

I find it disturbing that you have not been paying even a little bit of attention.

Or are just an idiot?

Mind bogglingly stupid "observation."

Tue, 06/14/2011 - 17:25 | 1369046 hugovanderbubble
hugovanderbubble's picture

Youre Right Highrev (this bounce has been pure oversold market and xtremly bearish news...but...)

The matter is not more Pomos after all the pump since september 2010 will be destroyed...:) and retraced....So lets go back to sp 1.100, first ok 1305-1310,,ok...its a "b" wave...the C or draupner wave will come like the hardest tsunami...

We are preparing the terrain for a big and huge drop, just that.

Tue, 06/14/2011 - 17:14 | 1369032 swissinv
swissinv's picture

very interesting - thnks

Tue, 06/14/2011 - 17:15 | 1369033 DNB-sore
DNB-sore's picture

welcome to the standard

Tue, 06/14/2011 - 17:21 | 1369036 buzzsaw99
buzzsaw99's picture

This will not be an easy mission, monkeys slow the expedition.

Tue, 06/14/2011 - 17:19 | 1369038 TruthInSunshine
TruthInSunshine's picture

Math doesn't lie, bitchez & bitches.

Do a "back of the cocktail napkin" simple mathematical equation plugging in CURRENT (you don't even have to use future) financial obligations, throw in total amount of current governmental, bank/financial, business, household/consumer debt, aggregate it...

Unless most developed nations are prepared to cut approximately 25% (in real and current terms) of their budgetary outlays, including the biggest PIIGS+UK+US, stagflation is coming that will make the 80s look mild, and it will devour the business cycle, wipe out trillions more in bad debts, lower consumption and investment, etc., which then cause massive deflation, ultimately resulting in intolerable inflation on the back end.

Krugman's hair of the dog that bit us will stagflate us into a long depression, while austerity of a serious method will put us into a sharp but much shorter lived depression, and allow for the rebuilding of a strong base from which to rebuild solid economic growth.

Austerity - Krugman HATES that word and concept, and he'll tell all his Walleye Vision friends to spread the gospel of anti-austerity, but a serious and controlled burn of the forest is the only thing that can save us from the much worse Krugmanite/Bernankean/Keynesian forest fire that will otherwise kill us all.

Oh - banks and Wall Street get to burn first.

Tue, 06/14/2011 - 17:22 | 1369045 Deepskyy
Deepskyy's picture

Agreed.  I've been calling for a "controlled burn" of the diseased growth since 2k8 when it became obvious that the whole damn system was rotten to the core. 

Tue, 06/14/2011 - 17:32 | 1369067 TruthInSunshine
TruthInSunshine's picture
Sudden Debt



Tue, 06/14/2011 - 17:36 | 1369072 Deepskyy
Deepskyy's picture

Thanks Truth.  I'll be adding that one to the bookmark list once I get home.


Tue, 06/14/2011 - 17:52 | 1369081 Deepskyy
Deepskyy's picture


Tue, 06/14/2011 - 17:34 | 1369058 Highrev
Highrev's picture

What's different from the 30's and 80's?

1) Technological Revolution

2) Global Village (in economic and trade terms)

3) Ever expanding democratization


I'm sure lots of us could add lots more to that list, but the point is to point out just 3 big reasons why growth and rising real standards of living (that's not necessarily the same as conspicuous consumption) is also a possibility (as contrasted with strict "cost cutting").

Tue, 06/14/2011 - 17:41 | 1369092 NotApplicable
NotApplicable's picture

Meanwhile what's the same?

Debt Fueled Capital Consumption

Until we stop eating the seed corn, there is no escape from the downward spiral that is destroying your first two points. As for your third one, well that's the reason all the capital is being consumed. Mob-rule is simply moral hazard personified.

Tue, 06/14/2011 - 17:52 | 1369126 TruthInSunshine
TruthInSunshine's picture

Krugman said that if we consume the seed now, not only will it satiate our hunger, but that crops will grow in our bellies, and spill forth from our mouths into the stalls of of the market, where others can purchase it from us (with Keynesian Bancors).

Tue, 06/14/2011 - 18:21 | 1369179 NotApplicable
NotApplicable's picture

Too bad he wasn't a better student of history, as I'd much rather hear tales of "roasted pigeons flying into the mouth's of the proletariat."

I'm told they're quite tasty!

Tue, 06/14/2011 - 17:52 | 1369114 hugovanderbubble
hugovanderbubble's picture

1)Technologial Rev..

Yes like Facebook,¡¡¡¡Bubble? no come´on¡¡¡ Yandex¡RenRen....

-Agree that that internet makes thing throttle or accelerate faster---Contagious Spread Effect -

Markets are much more intercorrelated so thats a risk too, different than in the 30´s (Globalization Risk)


2) Global Village

Global DebtHolders...) ----

3)Ever Expanding Democratization

Like in Mena Countries;Pakistan, Afganistan:) USE The guns and army power to install democratic development..¡¡¡ these changes will made world turn poorest, my humble view.

Spread the wealth without a scheme and patience is dangerous and the worst thing is comparing democracy in France with Pakistan , World Corruption inside politics sir

We need to use the best things of the protectionism to fight China uncontrolled Reserves, China is crashing the world , the opposite of what majority think.

No one in the world can compete in costs terms vs china and Emerging Countries.So massive delocation is not a good thing for real wealth in real countries , also offshore countries may have to be avoided and eliminated or at least minimized.



Still waiting for Chinese Real Banking Privatization, Chinese Unions,...Cuba Revolution, North Korea failure..., too idealistic maybe...

Tue, 06/14/2011 - 18:04 | 1369141 Highrev
Highrev's picture

Nothing like sharing ideas!

Diametrically opposing views (on this one anyway).

And somewhere in the middle lies the truth.

That's why I'm here.


I'm checking out for today, but before I go, I'd like to leave the following reflection: in Europe today, even the poorest of the poor live better than the kings and queens of Medieval Europe (yes I'm conscious that 3/4 of the world still has a long way to go to make it to this same level, but the implication is that not only is it attainable, it is, by historical example, actually probable).



Tue, 06/14/2011 - 20:29 | 1369431 centerline
centerline's picture

Ever seen the historical population growth charts?  Or thought about our dependancy on fixed resources?  Yikes dude.  Your smoking some serious shit over there (pass it around please).  A stable future is attainable, but only after we have managed to evolve past simple vices - animal instincts - and think/behave for the greater good.  The path will be two steps forward and one step back, two steps forward and one step back, maybe a leap, then a fall, etc.  And hopefully it is not the technology itself that is what wipes us out.  In fact, there is popular scientific theory about why we might not find the Universe just spilling over with intelligent life capable of reaching out to the stars... because most civilizations do not survive their adolesence.  I remain optimistic and am with you in the long-term.  We have already come so far.  But, in the short-term, retrograde baby.  Hold on to your bong.

Tue, 06/14/2011 - 18:44 | 1369212 francis_sawyer
francis_sawyer's picture

"The First Great Depression: Blow By Blow"


I'm basically guessing that there's more coke & hookers to go around this time around...

IOW - Lot's more "blow" for bankers any way you look at it...



Tue, 06/14/2011 - 21:08 | 1369529 Rusty Shorts
Rusty Shorts's picture

Coke was legal at the time, and plenty of it .. and you could wash that drain down with a Coca Cola ...



Tue, 06/14/2011 - 23:01 | 1369830 Yen Cross
Yen Cross's picture

 Hola. Will be in Maui week after next. Man Singapore is rocking. so clean. You would love it.  Buy Silver now and do smalls. Dollar cost average it in. No CFD's or ETF,s Buy miners or XAG.  Yen Cross.

Tue, 06/14/2011 - 19:22 | 1369302 masterinchancery
masterinchancery's picture

real growth was much better in the 20s, and didn't include a lot of government spending labeled as GDP.

Tue, 06/14/2011 - 21:35 | 1369585 fuu
fuu's picture

I could be way out in left field but I think the Great Depression was global in scale and was the result of huge technological leaps forward. Creative Destruction was running wild. The buggy whip infrastructure was no longer needed. Electricity and  telegraph had rolled out in a massive wave. Railroads had spanned America and most of Europe. Medical advances were already beginning to extend life expectancy and lower infant mortality.

Wed, 06/15/2011 - 00:52 | 1370004 AurorusBorealus
AurorusBorealus's picture

I am not impressed with your worship of democracy.  Little good has come from democracy and the more democratic the nation, the more totalitarian becomes the system.  Adolph Hitler was democratically elected as was Benito Mussolino and numerous other quasi-fascists in the central European states.  Democracy in America has not been a resounding success.  Dating from Women's suffrage, first with prohibition and later with all other many of nanny-state interventions, the role of government has expanded to totalitarian.

Democracies are incapable, as a rule, of thoughtfully managing crises.  See how the democracies fared in response to the Great Depression.  The Weimar Republic was the most liberal democracy man had ever created.  Democracies breed demagogues who encourage excessive feeding from the "public" trough and cronyism.  Democracies never manage to maintain a balanced budget and tax excessively.

Even the American founding fathers were wary of democracy and sought to curb the worst impulses of the mob with the Senate (which was not an elected body), the electoral college, and property requirements to vote in most states.  How much more will it take before we revisit Aristotle, who spoke of democracy as a deviant form of a republic.  The global crisis is not simply an economic crisis.  The fed and the banks did not grow so powerful in a political vacuum.  They did so in democracies, by bribing politicians and buying elections.  Whatever one wants to say of monarchy and aristocracy, never in history have those in power been so easily seduced.  One simply did not "buy" or "bribe" a king so cheaply.

The world must rethink more than its currency system.  The world must rethink democracy, but this will never happen, so brainwashed are the masses.  No one questions democracy.  And that is precisely the problem.

Wed, 06/15/2011 - 07:58 | 1370385 blindfaith
blindfaith's picture

America is NOT a IS a Republic and always has been until lately.

Wed, 06/15/2011 - 11:04 | 1371022 Urban Redneck
Urban Redneck's picture

You can debate whether the Republic died with Hamilton and the Bank, or Lincoln and the War, but I wouldn't characterize its death as occuring lately.


Republics decline into democracies and democracies degenerate into despotisms.

Tue, 06/14/2011 - 17:53 | 1369129 Hurdy Gurdy Man
Hurdy Gurdy Man's picture

re-... ? from a ... strong... wha...?


is that possible in the America perfectly innundated with zilcho political will? 


Tue, 06/14/2011 - 20:57 | 1369508 disabledvet
disabledvet's picture

trust me, "Syria's on the docket, too."  Just waiting on the gavel...

Tue, 06/14/2011 - 17:24 | 1369043 Oh regional Indian
Oh regional Indian's picture

China = Germany Russia = Japan Italy = ??? Ideas?

The parallels are striking. The US and UK have switched roles.

The rest is details.


Tue, 06/14/2011 - 19:23 | 1369304 masterinchancery
masterinchancery's picture

right on!

Tue, 06/14/2011 - 19:20 | 1369306 Greeny
Greeny's picture

"Russia = Japan"

In what terms? What are you talking about..

I would say Russia <> Japan, cause Russia has lot's of

land x 10 times (compare to Japan) (don't wanna dig for

exact number) lots of drunk people and GDP less than budget

of California state.

Tue, 06/14/2011 - 20:14 | 1369402 dark pools of soros
dark pools of soros's picture

have the Bolsheviks ditch their caviar for sushi?

Tue, 06/14/2011 - 19:48 | 1369350 tip e. canoe
tip e. canoe's picture

how bout this for a mindbender, ORI style?

US = Germany, UK = Japan, India/Isreal = Italy

China/Russia are the new US/UK.

this equation has no moral bias on either side, just a cold analysis of geopolitics.

x factor = some crazy Tesla type character releases the schematics for a cheap "new electric" devices and the rest of the world tell TPTB to go fuck off...

Tue, 06/14/2011 - 21:30 | 1369579 cramers_tears
cramers_tears's picture

Here's a Miracle-Energy device right here.  I'm amazed that Ross is still alive.  Hire that boy some XE. E-cat - small safe reactors.

Patent Office Forces E-Cat Self-Destruct Capability';

Tue, 06/14/2011 - 22:07 | 1369687 Mad Cow
Mad Cow's picture

Not sure about India and some new tech for the betterment of mankind, but sounds about right. Then, world gov will be easy.

Wed, 06/15/2011 - 09:12 | 1370576 tip e. canoe
tip e. canoe's picture

"some new tech for the betterment of mankind"

we all have our fantasies ;~)

Tue, 06/14/2011 - 17:33 | 1369073 That Peak Oil Guy
That Peak Oil Guy's picture

Of course, back then there were not also the problems of resource shortages, overpopulation, and global pollution.  Things are likely to be a bit more dicey this time.


Tue, 06/14/2011 - 17:47 | 1369108 tmosley
tmosley's picture

Yes, there were.  They were worse then than now.

Resources are always short when you look at the world through the eyes of a defeatist.  

Google "Green Revolution".

And global pollution is better, not worse than it was back then.  There are a few cities in China where it is as bad as it was during the Industrial Revolution.  Everywhere else has gotten cleaner, as new technologies have made us more efficient (ie we get complete burning from our power plants and other heavy polluters).


Tue, 06/14/2011 - 18:07 | 1369154 john39
john39's picture

in my humble opinion, the green revolution is largely a scam.  petrochemical fertilizers, GMO foods, petsticides and chemicals... sure, production went way up, but this is just another type of bubble that will crash...  and at what cost?  the environment getting wrecked, gmo's causing untold health and envirnomental damage....  and the quality of the foods is worse and worse.   foods devoid of mineral and vitamin content may look fine, but they do not provide the health promoting nutrients that bodies need.  in short, like everything else these days, the green revolution was just a fraud.

Tue, 06/14/2011 - 18:57 | 1369249 Noah Vail
Noah Vail's picture

Resources are infinite . . . until they're not.

Tue, 06/14/2011 - 21:42 | 1369601 bronzie
bronzie's picture

"petrochemical fertilizers, GMO foods, petsticides and chemicals"

read "Dirt: The Erosion of Civilizations" by David R. Montgomery

this book tells the tale of past civilizations that destroyed their fertile soil - note that these are past civilizations - it's hard to feed people without fertile soil

edit: I forgot to make my point: the chemicals we use to grow food are killing our soil, and once we kill our soil we are toast as a civilization

Wed, 06/15/2011 - 00:58 | 1370010 Oh regional Indian
Oh regional Indian's picture

Well said brinzie and truth be told, what you've said is in the rear view mirror.

Hydroponics...wait..... that needs plenty of clean water....hmmmm....fasting?


Tue, 06/14/2011 - 18:45 | 1369231 That Peak Oil Guy
That Peak Oil Guy's picture

Wow, dude, you seem to have relapsed back into delusion.  So many things wrong here I'm not even going to start.


Tue, 06/14/2011 - 18:52 | 1369245 jdrose1985
jdrose1985's picture

You want to talk about pollution?

Look at how polluted the populace is today compared to the early 30's.

I seem to be surrounded by slobs and blobs everywhere I go. Not to mention the nutjobs.

Tue, 06/14/2011 - 19:57 | 1369363 Vic Vinegar
Vic Vinegar's picture

Same shit different lifetime.

The world sux when you are a loser.  So let’s make some Bennie Bux off these slobs, blobs and nutjobs!

Tue, 06/14/2011 - 21:02 | 1369521 theMAXILOPEZpsycho
theMAXILOPEZpsycho's picture

you actually believe that?? laughable if true

Tue, 06/14/2011 - 17:51 | 1369112 Highrev
Highrev's picture

Agreed, and that’s exactly why I say the conspicuous consumption model of economic growth won't work. Our interconnected, technological world needs to focus its innovative efforts on a sustainable economic model. Growth CAN be compatible with conservation (in fact, they are not necessarily at odds to begin with), to a point, and there is plenty of time and plenty of natural resources to go around before reaching that steady stable state . . . if done correctly . . .

Okay, that's Utopia . . . I think our signal is breaking up . . .

Now back to our regularly scheduled programming.

Tue, 06/14/2011 - 18:04 | 1369149 NotApplicable
NotApplicable's picture

Wow, you just filled up my entire buzzword bingo card.

Tue, 06/14/2011 - 18:36 | 1369204 jomama
jomama's picture

where's the profit in that?!

Tue, 06/14/2011 - 19:01 | 1369267 Noah Vail
Noah Vail's picture

I'm particularly fascinated by the concept of the infinitely growing economy. At what point does it consume everything and have to move off the planet.


Growth, growth, thou shalt have growth or perish. Yeah, I know that's how you pay the interest but we seem to have a problem with teh principle at the moment.

Tue, 06/14/2011 - 19:11 | 1369286 swissinv
swissinv's picture

economics explain only one part of the civilisation cycle, after the second part it starts from beginning.

Tue, 06/14/2011 - 20:34 | 1369447 centerline
centerline's picture

Dont junk this one folks.  It is a happy thought.  And was ended perfectly!

Nicely done Highrev.

Tue, 06/14/2011 - 18:05 | 1369144 NotApplicable
NotApplicable's picture

No, those really were the good ole days, where there was a chicken in every pot, and scarcity itself had gone scarce.


Now, I'm not going to get into global pollution, but if you were in a populated area, it was likely locally polluted far worse than today. Also, depending on where you were in a rural environment, you might not have any trees left, or find that the land was turned into a dustbowl.

As for you promotion of Malthusian overpopulation theory, well that's just ignorance dressed up as intelligence. Life is nothing more than consumption of energy in an effort to put off entropy for another day. Given the amount of energy that exists within the planet alone, the idea that we reproduce faster than we can support ourselves is non-sensical, as it infers that living itself is suicidal. Another flaw in the theory is that one has to assume a certain standard of living in order to do the math. Thing is, there is no one single standard of living for all of us, so which one do you choose? We each decide how much to consume, how much to save, and how much to create, based on our abilities and desires. To try and throw all of these variables into a formula, well that's the ignorance I mentioned. Human action is not deterministic. We are not yeast. If we act like yeast however, well, that's because people are operating on false beliefs that prevent them from taking proper action. Like Malthusian doctrine, for example.

Tue, 06/14/2011 - 18:56 | 1369258 That Peak Oil Guy
That Peak Oil Guy's picture

Have you read Limits to Growth?  A forty-year old model holding up remarkably well to history.

If we only had 1 billion people you really think we would have the problems we face today?


Tue, 06/14/2011 - 20:07 | 1369387 NotApplicable
NotApplicable's picture

The problems wouldn't be the same, but there would still be problems.

I'm on my iTouch right now, so typing an adequate response is beyond my ability. Next time I see you when I have a real keyboard I'll get back to you.

Tue, 06/14/2011 - 20:08 | 1369395 OldTrooper
OldTrooper's picture

If we only had 1 billion people you really think we would have the problems we face today?

Probably not - we'd be too busy fighting over who gets to decide who is excess and what to do with them.

Wed, 06/15/2011 - 00:57 | 1370007 CompassionateFascist
CompassionateFascist's picture

The entire human race is a cancer on the biosphere. Fact, not analogy.

Tue, 06/14/2011 - 19:47 | 1369349 blunderdog
blunderdog's picture

the idea that we reproduce faster than we can support ourselves is non-sensical

Agree with your view overall, but this is a slightly different issue when you hear concerns from we neo-Malthusians.

It appears to me that we reproduce fast enough based on *current* resource availability and infrastructure development that we are very vulnerable to shocks and significant "corrections."

If something went wrong with the electrical grid in the Northeast and it was offline for a month, a LOT of people would die, even though they're perfectly sustained now.  If something went wrong with oil production for a year, multiply the scale of such a problem by a million.

Tue, 06/14/2011 - 19:55 | 1369362 NotApplicable
NotApplicable's picture

I don't deny any point you make, I just don't consider disruptions to the norm to be due to the carrying capacity of the planet. They will always exist, and are just part of life's risks that we all face.

Tue, 06/14/2011 - 20:24 | 1369428 blunderdog
blunderdog's picture

Oil's the potential issue I see.  Agriculture is a process of converting oil to food.  If oil supply is disrupted, or even better, actually depleted, I don't see any way to maintain our current food output. 

"Carrying capacity" for humans has become a function of technology, it's not just interlocked bio-systems. 

In principle, we could probably find a way to destroy enough plant life to deplete the oxygen supply.

Tue, 06/14/2011 - 21:48 | 1369629 bronzie
bronzie's picture

"we could probably find a way to destroy enough plant life"

you already answered this question in your post

"Agriculture is a process of converting oil to food"

and this process kills the soil which means plants can't live, which means ...

Tue, 06/14/2011 - 20:56 | 1369498 Manthong
Manthong's picture

Oh boy.

That explains a lot. Thanks.

Also the piece:

ALL of this crap is a government sponsored multi-level bucket shop.

Tue, 06/14/2011 - 17:48 | 1369110 Seasmoke
Seasmoke's picture

yes 2012 will be 1932 all over again

Tue, 06/14/2011 - 19:01 | 1369254 baby_BLYTHE
baby_BLYTHE's picture

the rest of this decade will be absolutely miserable. 

Eventually hyper-inflation will destroy the currency. It will be quick, sharp and extremely painful for the majority of Americans

soon after, the Federal Government will 'recall' the currency and issue a new one devalued at least 40% today's present value.

After that, you have a Deflationary Depression and then eventually we will bottom out and rebuild (not until at the very least end of this decade).

Through all this misery, the Federal Reserve will lose all remaining credibility.

Jim Rogers seems to be the only one out there in the financial media calling for an immediate end to the FED and Bernanke resignation

interview from today (6/14/11) :30 mark

Tue, 06/14/2011 - 19:17 | 1369298 Ese Pinche
Ese Pinche's picture

Ron Paul has been calling for an end to the Fed for years.

Tue, 06/14/2011 - 19:30 | 1369318 baby_BLYTHE
baby_BLYTHE's picture

I am a Ron Paul supporter.

I am talking about financial commentators on business media (not politicans). Jim Rogers seems to be the only one calling for an end to the FED 

Tue, 06/14/2011 - 19:37 | 1369337 disabledvet
disabledvet's picture

wanna campaign together?

Tue, 06/14/2011 - 21:05 | 1369518 disabledvet
disabledvet's picture

just an occasional scratch behind the ears is all i require. "throw me a bone and i'm there!"

Tue, 06/14/2011 - 21:17 | 1369550 francis_sawyer
francis_sawyer's picture

"Through all this misery, the Federal Reserve will lose all remaining credibility"

They ever had any credibility to begin with? Now THAT's news to me!

Tue, 06/14/2011 - 21:52 | 1369650 disabledvet
disabledvet's picture


Tue, 06/14/2011 - 17:52 | 1369115 jkruffin
jkruffin's picture

Read this and tell me Senator Kay Hagan is not as lost as the rest of the politicians:  ( or should I say paid off).....


June 14, 2011

Dear Friend,

Thank you for contacting me regarding an audit of the Federal Reserve. I appreciate hearing your thoughts on this important issue.

The Federal Reserve does currently undergo what would be considered a standard audit -- an examination of accounts and records. Furthermore, Congress already reviews semi-annual reports on monetary policy submitted by the Federal Reserve Board of Governors, as required under the Full Employment and Balanced Growth Act (PL 95-523). Under the Federal Banking Agency Audit Act (PL 95-320), the Government Accountability Office (GAO) has the authority to conduct financial and performance audits of the Board of Governors and the Federal Reserve banks and branches. However, such audits are limited, as the law stipulates that monetary policy operations, foreign transactions, and Federal Open Market Committee operations are excluded from the scope of the GAO audits.

An audit of the Federal Reserve System is an issue that has been debated several times since I began serving in the United States Senate, most recently during the 111th Congress when the U.S. Senate addressed financial regulatory reform. All Federal Reserve audit legislation proposed in the 111th Congress called for increased oversight by the Government Accountability Office (GAO) into business conducted by the Federal Reserve.

On January 26, 2011, the Federal Reserve Transparency Act of 2011 (S. 202/H.R. 459) was introduced in the Senate and referred to the Committee on Banking, Housing and Urban Affairs. The bill instructs the Comptroller General of the United States to conduct an audit of the Federal Reserve System's Board of Governors and also the Federal Reserve banks before 2013.

The formulation of monetary policy is a decision-making process that involves information gathering from a host of foreign governments and central banks. The information provided from those exchanges is critical and extremely sensitive. The immediate and broad disclosure that the Federal Reserve Transparency Act of 2011 requires could disrupt financial markets and jeopardize our country's international finance relationships. Ultimately, it would be taxpayers who would bear the brunt of any losses resulting from policies caused by untimely disclosure of sensitive information. Because of this, I do not believe the benefits of legislation like the Federal Reserve Transparency Act of 2011 outweigh the costs.

When Congress passed the Federal Banking Agency Audit Act in 1978, the legislation attempted to balance the need for public accountability of the Federal Reserve with the need to insulate the Fed's monetary policy function from political pressures. I believe this balance must be maintained going forward. For that reason, I twice supported amendments during the 111th Congress that would have required one-time audits of the Federal Reserve System's actions in response to the financial crisis. Both amendments struck a balance between accountability to the American taxpayer and the denial of political pressure and influence on the Federal Reserve System. The result would have been increased insight and reassurance for the American people that the Federal Reserve is working in the best interest of taxpayers to strengthen and protect our financial system.

Again, thank you for contacting my office. It is truly an honor to represent North Carolina in the United States Senate, and I hope you will not hesitate to contact me in the future should you have any further questions or concerns.


Kay R. Hagan

Tue, 06/14/2011 - 18:02 | 1369137 TruthInSunshine
TruthInSunshine's picture

Here is the abridged version:

Dear constituent,

I am deeply captured by the money masters, whom you do not know, but will kill me and my family (and those my cohorts) if I were to ever publicly admit that they own what you think of as your government and that the very notion that you live in a republic based on democratic representation is an illusion carefully crafted and maintained by them.

They own and control everything, and their power is derived from deceiving you into a circumstance whereby you and your children willingly further their interests at the expense of your own.

So please go screw yourselves & pester me no more. For I am but a powerless serf, despite the illusions created by what you perceive to be my position of 'authority' and the 'trappings' of my 'office.'




A Truly Lame & Lame Ass Duck

Tue, 06/14/2011 - 18:13 | 1369161 NotApplicable
NotApplicable's picture

Nah, here is the real abridged version:

Dear constituent,

Fuck you, and have a nice day. Your name has been added to our list.


Power Tripper.

p.s. Thanks for groveling at my feet. It really helps get me through the day.

Tue, 06/14/2011 - 21:05 | 1369526 disabledvet
disabledvet's picture

here's the real abridged version:

"dear Contestant ____________.  Thank you for application for our upcoming Jeopardy in Vegas episode.  Unfortunately due to the large volume of responses we are...actually incapable...of...truly a way that....

Tue, 06/14/2011 - 21:20 | 1369562 francis_sawyer
francis_sawyer's picture


Here's the DEFINITIVE abridged version...

"Sext me a foto of your junk, & I'll show you mine"


Tue, 06/14/2011 - 18:20 | 1369173 Deepskyy
Deepskyy's picture

Shit... why did you even bother trying to get that useless witch to turn on the banksters?  I'd not trust Kay Hagen to run a hot dog stand and yet the brilliant Keynesians and other liberal elites here in NC thought she was a good pick for Senate.


I do feel bad for the poor staffer who had to pen that joke of a response letter.  Not sure the office of Kay Hagen has too many "canned" responses for cries to audit the fed.  Some fool had to actually work to come up with that fluff peice. 

Tue, 06/14/2011 - 18:39 | 1369201 NotApplicable
NotApplicable's picture

Surely they've got a shared pool of those letters complete with fill-in-the-blank sections for the appropriate words. (probably with auto-suggest, even)

Tue, 06/14/2011 - 18:44 | 1369213 gwar5
gwar5's picture

It is also my great misfortune to have Kay Hagan as my senator, too. I sent her emails exorting her to cut spending and vote against Obamacare.

My mistake.

Now I regularly receive Pollyanna robo-spams telling me how wonderful things are going in Washington, DC.

Tue, 06/14/2011 - 19:21 | 1369299 mogul rider
mogul rider's picture



Wed, 06/15/2011 - 02:31 | 1370124 IQ 145
IQ 145's picture

 Tasmania is just barely far enough away.

Tue, 06/14/2011 - 18:09 | 1369152 Waterfallsparkles
Waterfallsparkles's picture

Very much like an underwater Homeowner.  Greece should Default.  Start fresh with their own Currency.

Tue, 06/14/2011 - 18:20 | 1369171 Cheesy Bastard
Cheesy Bastard's picture

Yup, they should go back to being a bunch of drachma queens.

Tue, 06/14/2011 - 18:20 | 1369174 NotApplicable
NotApplicable's picture

If only Greece was real, and capable of action, perhaps then it could do such a thing. Instead though, it's an abstraction which prevents the individuals who do take action, from being held accountable for it.

What I'm trying to say is, there is no mechanism for this to happen. Sure politicians  might like to be able to walk the streets amongst the public, but the public is not the only antagonist in this drama. Because you know, it would be a terrible if something were to happen to a politician's family. Or if word got out about their criminal activities.

Tue, 06/14/2011 - 20:11 | 1369390 hamurobby
hamurobby's picture

To use Celente's version of how it goes, they haven't lost it all, have nothing to loose, and then loose it...yet.

Tue, 06/14/2011 - 18:11 | 1369162 spear-x
spear-x's picture

I am fairly new to all this, so help me out here if I am on the wrong track.

My understanding is that the '30's Great Depression was a deflationary depression and that that type of depression was not as destructive as it would be today due to the gold reserves at that time and gold and silver did not hit the highs that some are predicting this time around. Is it true that today it would be preferable to enter into a hyperinflationary depression due to the absence of gold reserves, causing hard assets to soar?

What are the preconditions for each type situation? or could it go either way at any time?


Tue, 06/14/2011 - 18:41 | 1369217 NotApplicable
NotApplicable's picture

What's true today is that preferences are all subjective, and everybody's got a theory.

Of course, when one cannot get a firm consensus of the definition of money, many competing theories talk past each other in wholly separate universes.

All I know for sure is that no matter what, it's going to sting.


Tue, 06/14/2011 - 18:47 | 1369233 jdrose1985
jdrose1985's picture

Bottom line is that money is created by consumers signing on the authorized signature line.

It is a credit system, not a cash system. Huge difference. M2 is a fart in the whirlwind.

Funny how most everyone here swears Bernanke is a liar (he is) yet they believe his 2002 helicopter speech down the the last syllable.

Tue, 06/14/2011 - 20:07 | 1369391 gwar5
gwar5's picture

That's the $64,000 question. Depends on your personal situation, but generally they say inflationary depression is better, but we're all breaking new ground this time around because wages are not. 

Brief explanation, current situation, is that the housing and stock market bubbles popped leaving banks and consumers broke, which was a huge deflationary event. Derivatives spread the disease globally.

Inflation was the Fed's response to the deflation to try to out run the deflation by printing enough money to compensate for the lack of demand and to recapitalize the banks so they'd lend again. But not working so far, just causing commodity inflation.

The real kicker is the huge $600 Trillion layer of Ponzi called derivatives, created by the banks, piled on top of everything else in the system. Deflation will crash it, and it's too frightening for the Fed to contemplate, so it does not appear to be an option. 

All the derivative leverage was built on the assumption they were safe, but they're not. They depend on underlying things like sound mortgages, sound Treasury Bills, and sound Muni bonds which are very wobbly. So there's nothing for Benanke to do but smile and print faster to try to inflate his way out of it.

So far we've only got a taste of what bad housing and mortgage derivatives can do, and they're not even done crashing yet.

Generally, deflation is bad for debtors while it is good for debtors, like the former USA. 




Tue, 06/14/2011 - 21:53 | 1369653 bronzie
bronzie's picture

"we've only got a taste of what bad housing and mortgage derivatives can do, and they're not even done crashing yet"

OK, I agree that housing isn't done crashing yet but, according to Martin Armstrong's cycle work housing will bottom in 2032 so we only have 21 years to go ...

Tue, 06/14/2011 - 18:15 | 1369164 Gully Foyle
Gully Foyle's picture
"Brother, Can You Spare a Dime," lyrics by Yip Harburg, music by Jay Gorney (1931)


They used to tell me I was building a dream, and so I followed the mob,
When there was earth to plow, or guns to bear, I was always there right on the job.
They used to tell me I was building a dream, with peace and glory ahead,
Why should I be standing in line, just waiting for bread?


Once I built a railroad, I made it run, made it race against time.
Once I built a railroad; now it's done. Brother, can you spare a dime?
Once I built a tower, up to the sun, brick, and rivet, and lime;
Once I built a tower, now it's done. Brother, can you spare a dime?


Once in khaki suits, gee we looked swell,
Full of that Yankee Doodly Dum,
Half a million boots went slogging through Hell,
And I was the kid with the drum!


Say, don't you remember, they called me Al; it was Al all the time.
Why don't you remember, I'm your pal? Buddy, can you spare a dime?


Once in khaki suits, gee we looked swell,
Full of that Yankee Doodly Dum,
Half a million boots went slogging through Hell,
And I was the kid with the drum!


Say, don't you remember, they called me Al; it was Al all the time.
Say, don't you remember, I'm your pal? Buddy, can you spare a dime?
Tue, 06/14/2011 - 18:25 | 1369184 spinone
spinone's picture

dont forget the feeling of history. listen to the orld recordings, look at the art, and the pictures. It will serve you well.

Tue, 06/14/2011 - 18:32 | 1369189 spinone
spinone's picture

Listen to the broken pride and woe in the song

RIP Bing.

Tue, 06/14/2011 - 20:33 | 1369444 Gully Foyle
Gully Foyle's picture


Bing was a child abusing prick who's two sons wound up committing suicide.

That said he had a wonderful voice and soothing stage persona.

Funny how those old "heroes" were dicks in real life, Bing and the abuse, John Wayne draft dodger, Johnny Weismuller wife beater.

Life was more fun when I was less aware.

Wed, 06/15/2011 - 05:38 | 1370249 spinone
spinone's picture

Yeah, and Ghandi beat his kids. There are no heroes.

Tue, 06/14/2011 - 22:02 | 1369683 Monedas
Monedas's picture

Did you ever hear George Michael's version ? I was able to compartmentalize his gayness and really enjoyed his version ! If he would just limit his public restroom activities to begging for dimes ? Hahahaha ! Monedas 2011 If you're ever in Montevideo and you see a guy listening to Tangerine on the Juke'll be Monedas

Tue, 06/14/2011 - 18:38 | 1369199 geno-econ
geno-econ's picture

What is not the same?

$600 trillion in unregulated derivatives that passes risk to leveraged third parties

Uncertainty of China holding huge hoard of weakening US$s

Mind boggling deficits unable to be serviced if interest rates rise by 1%

Continuation of Glass-Stiegel

Scarcity of many resources due to global conditions--water, oil, forests, etc

Much larger world population

21/2 unproductive wars


Personal debt volumes-- credit card, college loans, mortgage, home equity, auto leases and loans,etc. 

Of coarse many things are the same such as high unemployment, asset destruction , income disparity and corrupt polititians. 


Tue, 06/14/2011 - 18:45 | 1369222 jdrose1985
jdrose1985's picture

And the entire global financial system has been operating on not a damn thing besides signatures since 1933.


Of course that signature is gold when you realize what the collateral is behind the full faith and credit of the American people.


Welcome to the plantation folks, simple as that.

Tue, 06/14/2011 - 18:47 | 1369224 bob_dabolina
bob_dabolina's picture

What's the name of that website where you can short/long on different issues?

Zerohedge has mentioned it on several occasions.

Tue, 06/14/2011 - 18:47 | 1369234 Fancy Bear
Fancy Bear's picture


Tue, 06/14/2011 - 19:04 | 1369281 bob_dabolina
bob_dabolina's picture


It's a fun website.

Tue, 06/14/2011 - 21:36 | 1369587 theMAXILOPEZpsycho
theMAXILOPEZpsycho's picture

Its ok but quite limited - ie to US electoral candidates

The trade that I'd just LOVE to make somewhere, if anyone can tell me, is to short bitcoins

Anyone!?? PLEASE!

Tue, 06/14/2011 - 18:53 | 1369248 gwar5
gwar5's picture

The BIS was pretty aware and concerned about gold alright.

The BIS was a side note in those days. Their role has changed and expanded. Now they're the central bankers to the central bankers, luxuriously bunkered in the tower of Basel. With tunnels! 

If anything happens, it will bust out in the Middle East with the new MB caliphate rushing Israel, who will vigorously defend.


Tue, 06/14/2011 - 19:07 | 1369279 Greeny
Greeny's picture

Gold somewhat good capital preservation, but the

key word here is "Capital" if you have like 50k or so it


matter at all. The problem is that most ppl here are

thinking that

they are smarter than top guns, like Bernanke..

In other words, if you praying for collapse, then you


be better off buying lead instead of Gold..


Anyways, till your doom and gloom scenarios actually

turn out to be true, your wealth will be transferred

to more positive guys.. Don't pee against the wind,

got it? :)))

Tue, 06/14/2011 - 21:34 | 1369591 theMAXILOPEZpsycho
theMAXILOPEZpsycho's picture

I'm with this guy! give me 5 subprime mortgages and Facebook stocks!

Wed, 06/15/2011 - 03:56 | 1370187 data_monkey
data_monkey's picture

Only thing I understood from this post is that I shouldn't pee into the wind. Very sound advice. I hope my inferior brain can remember that. Thanks Ogre, I think I got it.

Tue, 06/14/2011 - 19:16 | 1369291 Cheesy Bastard
Cheesy Bastard's picture

I'm dreaming of a blight christmas, just like the ones I used to know....

Tue, 06/14/2011 - 19:20 | 1369305 Caviar Emptor
Caviar Emptor's picture

The fundamentals of our economy are sound

Tue, 06/14/2011 - 19:31 | 1369322 spinone
spinone's picture

Subprime is contained

Tue, 06/14/2011 - 19:32 | 1369329 Cheesy Bastard
Cheesy Bastard's picture

Just a bump in the road to recovery.

Tue, 06/14/2011 - 20:30 | 1369446 cosmictrainwreck
cosmictrainwreck's picture

a veritable "soft patch", as it were.....

Wed, 06/15/2011 - 00:16 | 1369950 Hook Line and S...
Hook Line and Sphincter's picture

'Do i really look like i have a boner?'

heard by a bystander as Bernanke walked past, 2011, Jan 3rd

Tue, 06/14/2011 - 21:26 | 1369575 Confucious 222
Confucious 222's picture

We have always been at war with Eastasia

Tue, 06/14/2011 - 21:38 | 1369597 Selah
Selah's picture


We aren't at war with Eurasia?

Holy Crap! I've got some bumper stickers to remove...


Tue, 06/14/2011 - 22:08 | 1369698 Armando Javier ...
Armando Javier Finkeltein of the Boise Finkelsteins's picture

A chicken in every pot

Do NOT follow this link or you will be banned from the site!