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Visualizing An Austere Europe
With the euro collapsing, all of Europe is on the brink, and as a result, every European country has now instituted some form of austerity measures. Hereby, we summarize what these look like to date. Unfortunately, we are confident the current batch of austerity will be materially insufficient with many more rounds of cutbacks to come. Looking across the Atlantic, the US has yet to initiate any reductions in its gargantuan budget deficit or governmental spending. And as can be seen its metrics are just as bad if not worse than most of Europe. Use this chart to get a sense of what the initial round of US austerity, when it strikes, will look like.
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Nice voice. Quite a contrast to Areosmith ;-)
Well, you know me lilsis .. I usually make those close to me dig a little more and clear a few more hurdles. ;) Besides, I thought I had introduced you to Jack Johnson some months ago and if I recall that was in duet with Ben Harper. The deal is that I truly believe you have found the combination and given your expressed circumstance I wonder why you're not feeling the warm embrace of assurance. Always remember my dear friend that the five steps to to the grieving process doesn't end with acceptance that shit's flaky. Rather, this process is all about figuring out that with acceptance comes the beginning of real living, not its end.
I saw the trio one you left with Jack Johnson. I think I have a few illusions to fall through first to really stay situated where you are describing. I remember and forget and remember again.
At the time I had responded to your impressions of listening to a former SO's endless Johnny Cash. I think this might relate to your history in relation to the Fab Fab commentary and the situation involving his post doc gf... To refresh...
http://www.youtube.com/watch?v=03Z5Ai3J1ug
All of life is a process of bumbles & stumbles sis. This is among the primary reasons why we have special relationships with family, pals, SO's and all the rest and back check processes incorporated within these relationships. Fact is that I hear you wondering what is the big deal if your pictures are all parallel? after all, what does supposedly lining up pictures have to do with anything? Perhaps if you were the one observing rather than the one going trough the bumbles & stumbles you could appreciate this particular sentiment a bit more fully... peace pal
http://www.youtube.com/watch?v=NyNFyzldpIs
http://www.icelebz.com/lyrics/thievery_corporation/radio_retaliation/fem...
That would be a new or, more properly, a very old one: An Austere Europe.
Main Entry: aus·tere Pronunciation: \o?-?stir also -?ster\ Function: adjective Etymology: Middle English, from Anglo-French, from Latin austerus, from Greek aust?ros harsh, severe; akin to Greek hauos dry — more at sere Date: 14th century1 a : stern and cold in appearance or manner b : somber, grave <an austere critic>
synonyms see severe2 : morally strict : ascetic
3 : markedly simple or unadorned <an austere office> <an austere style of writing>
4 : giving little or no scope for pleasure <austere diets>
5 of a wine : having the flavor of acid or tannin predominant over fruit flavors usually indicating a capacity for aging
— aus·tere·ly adverb
— aus·tere·ness noun
Me thinks that Europe is way ahead of the world. Still.
They'll default before we do. Trade on it.
Well, we all seem to want austerity for others...
umm no..we want GDP to grow (people to earn and consume) enough so that debt/GDP goes down whilst corrupt banks and politicians can be satisfied with a lower share of GDP (but lots more of our money!)
Two ways you can reduce the deficit. Raise taxes or cut spending. Of course one can do both.
Common sense says that raising taxes and cutting spending can also have the opposite effect. Raising taxes can, if improperly focused, lower the very engines that fuel tax revenues.
Similarly, cutting spending can also reduce revenue, in as much as spending can produce the technologies that lead to efficiency. For example, imagine if the Internet had never emerged from DARPA, and rather we were living in a world of non-cooperating fiefdoms, like Compuserv/AOL/MSN ... that almost happened! TCP/IP lead to the Internet we know today. That was government spending for something the market had no intention to provide (Interoperability!) that has paid off HUGE in terms of efficiency and the World-as-we-know-it!
Also cutting spending can cause more spending, where the spending cuts cause problems down the line. If we suddenly had no defense budget, perhaps that would lead to greater costs in a few years, as we'd get attacked, need to get back up to speed etc.
So the prudent level and focus of tax raises and spending cuts has to take into account these feedback loops. THERE IS NO ONE SIZE FITS ALL "Cut all spending and cut all taxes" mythology that some people cling to. In all things there must be a prudent balance.
Now who sets that prudent balance? Government? Self regulation? BOTH HAVE FAILED. The government refuses to govern for the good of the people, and the self-regulated refuse to self-regulate for the good of the market. Not enough smart, wise people in Government who aren't owned by corporations. Not enough smart, wise people in corporations who have a sense of honor.
IN SUMMARY: Before we can begin to figure out how to reduce our deficit by prudently effecting tax and spending policy, we need decision makers who are (1) smart, and (2) not corrupt. Until then, we ain't geting shit done.
Hugs.
I agree. Right now these forums (e.g ZH) represent the only unemcumbered intellectual gathering I canthink of. Trouble is we have no experience of "goverment" (maybe that's not a bad thing. But there are three key aspects of Government, the executive, the administration of the executives wishes and finally politics.
Separately, the military does its own thing and is out of control. It needs to be made efficient. That is, use high tech to kill people (ugh, can't believe I even made the miltary relevant in this globalised economy) rather than boots on the ground.
I suggest that we need a framework that delivers solutions, then get our own "pet" politicians (that aren't motivated by self-interest or who have sold out) to run for government in much the same way that politics works now.
When we have the framework, we can take a year or two to work out the solutions and get the politicians (talking heads) to implement them.
Think of the military as a mega employment program. What would happen to the unemployment rate if even half were discharged?
+1000 cumulative. Folks can talk all they want about money, credit, gold and commodities, but in the end (I hope) the reality of human values is asserted.
This is an incredible time in human history, it seems to me. The internet allows cross-pollination and sharing of intellectual life between the math enabled and the math disabled. It's a shame, but that divide exists.
ZH facilitiates the overlap and bridges the divide.
Good shit.
That thought crossed my mind...war = profit minus able-bodied men and women. Trimming the herd makes it more manageable.
We have already found out. From 1991-1995 the size of the active army shrank from 780K to about 440K with similar reductions in the other services. This process changed the mix of forces between the active & reserve components, their responsibilities to achieving American strategic objectives assigned to them and their organization of personnel and equipment. This increased role of the Guard & Reserve has been seen recently not only in Iraq & Afghanistan, but in the ability of the separate states to respond to natural disasters. You might remember this whole restructuring process as the military protion of the "peace dividend".
So we should increase military spending to decrease the unemployment rate.
Should we? No.
Have we? Yes.
The idea that we couldn't have the Internet without DARPA is simply wrong. That was an expensive top-down solution. The first routers, modified Honeywell mini computers, cost about .5 $Million in 1969. Yet once inexpensive micro computers became common a decade later, amateurs working at home were able to replicate most of the work for a comparitively miniscule cost. At its height, the BBS scene offered a very good preview of what a large array of independently owned systems joined by a common protocol could offer.
What made the modern Internet possible was the advent of cheap computers for consumers, and then moving beyond the mentality of DoD procurement. Something that was never a goal of the government. Once a large number of people had access to the hardware, getting those diverse systems to talk to each other was a natural goal, especially from an entrepreneurial perspective of not wanting to be limited to any one platform. The elimination of the AT&T monopoly, a product of government control, was also very important to letting independent developers find news way to use and extend the network.
Government isn't without some value in such situations. Sponsoring the creation of standards for fulfilling the governments own needs can also done for fairly cheap, if the agencies don't over-reach and try to be tech pioneers rather than exploiters.
Self-regulation fails when there is no penalty for stupidity and/or corruption. The entity that makes that possible is government, by intervening in the market rather than let reality have its way. Bad government and bad companies are both awful things but the combination is truly deadly and a threat to us all.
How about a third way to reduce the deficit - lower taxes, and lower spending even more.
Rahm and the Bamster, together with Pelosi and Reid, are working by the FDR playbook: Use the crisis to permanently grow the reach and power of the central government.
Grow the reach and power? LOL - They are whistling past their own graveyard and the memo is still stuck to the bottom of their shoes. The only thing left for them to tax is the IOUs on mortgages, car loans, credit card debt. If nobody pays any of these things anymore they can only get their tax from increased oil prices - until Americans start using mopeds and bicycles to get around town - then oil will drop back to $50/bbl.
Deflation and deleveraging rules and nothing can stop that.
pelosi and reid have always been political versions of european PIIGS at the trough. (woops, pulls head in and reaches for a beer).
All they need to do is stop the wall street leach profit taking and the rest might take care of itself. Does it help the supplier or the buyer when arbitrage is maxed out with HFT? They are taking all of the profit out of Capitalism. They are starving our businesses.
I'm shopping for a sweet carbon-fiber rickshaw with ergonomic harness. All cash income.
Joking aside, do keep in mind that FDR's team drove the economy into the mud, and still he taxed and regulated ever more, growing the state remorselessly. We aren't even close to european levels of statism and generalised poverty yet(tiny cars, tiny living spaces, tiny disposable incomes) so there is still plenty of distance to fall just to arrive at that level.
These numbers can best be understood as a quantitative way of saying "We're just doing our jobs. Don't fire us, please."
By the way, budget cuts are going in stealthy. Most of the media runs off of government/corporate press releases or from television. The editors assign the stories - not the reporters. Bloggers have more freedom, but they can still be thwacked by editors and corporate.
I have some contacts in the public university system at NYC. They are being gutted. The softies without guns are always first. Swapping formerly public schools to charter is also a stealth way of shifting municipal obligations to the federal government.
They will do anything to provide plausible reasons to avoid downgrades and riots from the teacher's unions.
University administrations are in Cover Your Ass mode. They look at employment numbers from their graduating classes and piss themselves. They know that when students are allowed to go BK (or the Fed raises rates) they will have their little communist graduate students screaming for blood.
Speaking of government... someone needs to do the Secret Service's job for them. How in the fuck is Barry on a speaking tour now when NATO is falling apart? Hell, I want to make sure that guy is safe in Cheney's Fuhrerbunker. It appears he would rather put himself at risk (probably contrary to his advisors wishes) than do the smart thing and wait for the inevitable impeachment.
Keep that guy alive. While he's obviously a crook (like all politicians), if he gets whacked, it will make peace that much more difficult to achieve. Just let him perform a Gorbachev function. This is not something that he can photo-op his way out of.
You can tell, with the neocons and the liberals alike: When they compare someone to JFK and Lincoln, they want someone revolutionary enough to provoke assassins.
Privatize the Secret Service.
Impeach Obama? Oh man them's fightin' words. 97% of blacks voters checked his box. That would start some serious race riots.
I don't get it. Are you saying the SS decides when and where Barry gives speeches and not his advisors?
You're silly. You provide some interesting perspectives but I can't figure out what your agenda is.
Well, you think they still love Obama?
They're eliminating the housing projects. Cutting the social services. Many of these people have relied on it for generations. Merely because the guy knows how to pay some drunks $10 and get them in a bus to vote means nothing.
Look at Newark. Same kind of guy (Cory Booker). Wasteland. You turn on Black radio, they're calling for revolution. Black Power is making a resurgence. Through ridiculous budget cuts, they're setting the stage for creating little Chechnyas all over the country.
That's why I say that the guy is fucked. Even the Republicans are losing control, which is darkly amusing. You have to understand... these cities are held in check exactly as the Empire functions abroad. Through bribes, priests, special protections... as those drain away, the knives come out.
You're correct to be skeptical, though. Trust your own sleuthing over what you would expect from politics as usual.
Remember COINTELPRO. There's nothing more that the tax eaters (and their sympathizers) would like than to discredit Zero Hedge and sites like it. Imagine the comments being read out loud during a Senate hearing on censoring "dangerous political speech."
Am I clear? The stakes are high.
Very much enjoyed the response. I follow what you are saying - most of what you post is a fresh perspective.
+ e^x WW and Apostate. Great comments. Only at a ZeroHedge near you.
Apostate & Wings - No doubt. Just don't forget what it's all about...
http://www.youtube.com/watch?v=7xxgRUyzgs0
Not only has the US not instituted austerity measures, but I read somewhere that Pelosi, in her infinite wisdom, has said the Congress will forego the usual budget process and just write checks. That's right ... no more, "let's see, we will take in this much so we can spend this much ..." Instead, like my ex-wife, as long as there is a check in the checkbook there must be money in the bank. Write'm and they will clear. Completely unfettered and unrestricted spending on anything and everything they can think of and there will be no budget process at all.
I guess they figure with all those Euros turning into dollars and treasuries (they probably crashed the Euro on purpose and for this reason) there is no reason to hold back. The dollar won't fall and we won't have a failed treasury auction. Where else can people go to get ZIRP return on their short term money?
This is the same lunatic Pelosi who encourages those of an artistic bent to quit their jobs and become government-sponsored bums, so they can pursue their muse.
If only she would take up regular painting and quit her day job of redrawing the map as a portrait of despair.
Wow! Just....wow! Thank you for the chart. It clarifies everything. Some of the people in my life who only get the propaganda from MSM look at me like I'm nuts when I tell them that the "growth" they are seeing is an illusion and not sustainable, that everything is going to fall eventually. I am saving this chart for them.
Our idiot lawmakers gave overpaid federal workers a 2% raise this year as we are spending trillions we don't have... They should be getting a pay cut.
Some states are making large benefit/pay cutbacks unlike the feds who act as if nothing needs to change.
In the US, our states are in the middle of austerity, just ask a few teachers.
Federal debt is not separate from state debt in overall effect. If bailout costs are not offset by effective investment at the state level, the states will be gutted long before the FED's ability to confiscate state (tax payer) wealth through QE and bank handouts.
Unless the state's see more direct bailout funds, the states will not benefit from the costs incurred to bailout private corporations and banks. Central government mal-investment effects the overall system in use of capital. There is a finite amount of real capital and its initial effects.
We know about the concept; Velocity of Money, but we should put forth another concept;
The Velocity of Debt.
Because this momentum in debt is driven by the magnitude of mal-investment at the federal level, and it is the state's, and the tax payers within these states, which will pay the bill. More importantly, the velocity of paying this debt will also increase.
The central government has no real growth, no matter what the stimulus, without state real growth. Add to this the state's inability to cover increasing health care costs through QE, and the system will collapse from within.
The only way to quickly create parady between the state and the central government is to allow states access to money creation. Without this, the state's will be crushed under the weight of costs and taxation. But, this STATE BAILOUT, can only be seen as a last desparate act of the administration and FED. Meaning, upon such action, our credit rating should be junk, and capital will flee from the US.
Mark Beck
Astute points - always enjoy your posts.
I think Mark meant "parody". SLuGs (state and local govs) working with the Feds at this point. It's hilarious. Paying ransom to mass murderers.
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What's the big deal?
With the strongest currency in the world, and everyone clamoring for more of our bonds, we can virtually monetize everything:
- deficits
- public sector payrolls
- retirement pensions
- welfare, social services, etc.
UNLIMITED FIAT!!!
http://www.youtube.com/watch?v=YmgaqiKtiK4
Monetize this!! hahaha!
It would appear so. Although appearances can be deceptive...
AND NO TAXES! Everyone gets Columbus and MLK Day off too - not just public sector employees and bank tellers anymore!
I am amused that people fail to wrap their heads around inflation and deflation happening at the same time.
How will it crash? Too much debt, and the paper currentsea is unserviceable. What is REAL money? Gold and silver (platinum is the older sister that wonders why you wouldn't have her...she can do everything the little sisters can do and more!) is money. So the VALUE of REAL money skyrockets, because the VALUE of FIAT money collapses. Yes, because what is value? Value just is. No number is needed at first. You either value or you don't. Then, if you value a thing, THEN quantify it. "Yes I value this hard to find metal. Will I accept it for a house? A car? Which car? Which house? This silver for an ipad? This silver for a tab at my watering hole? And HOW MUCH!"
Also, when this happens, what will the price of everything else be. Well, sure a computer would now COST a lot to make, but its use may be nothing compared to its scrap value. Also, cars for example. Could you AFFORD a car, and then could you afford to SERVICE a car?....peak oil will be a hardship and yes, we are on the plateau, and yes we will move off of this plateau, when...tomorrow? A year? Two years? By 2013 I guarantee we have. Evidence we are on a plateau? Oil is $73, no wait it's $85, wait no it's $73. The volatility will increase until the back end of the hand...er, I mean curve. Once we hit the backside of oil production COSTS of EVERYTHING will increase, this while growth decreases. Oh, and this economic collapse has to do with peak oil. Either the banksters wanted to fully implement their police state before the House of Saud said, "You know what? We lied about our oil reserves, and we are going to sell oil at $1000 a barrel now." Or, like Webster Tarpley says, these oilgarchs are blundering idiots, and they wanted to punish the system through Masocistic derivatives in hope to....shit I have no idea what they hope to accomplish. I think they are playing Calvinball to be honest.
The terms inflation/deflation are debilitating the argument. Simply put, BS said to Barry, "Drive this (the US) through that brick wall." Barry's sorry ass said, "If it makes me popular/powerful!" He got in, put the pedal to the floor and BAM! The thing was that the car was strong. Yes America, your car was strong! So it made it through the wall. But on the other side of the wall? Nothing. A cliff. Now we are in free fall. It is a long way to the bottom. However, it is a long way to the top if you want to rock and roll. Think of PMs as Angie's guitar.
Ac/Dc - Its A Long Way To The Top(If You Wanna Rock 'N Roll):http://www.youtube.com/watch?v=_UaJ9UKM7kk
- couldn't have said it better.
Perfect! Here's another way to look at it. (I'll take Chloe (silver)):
http://www.samchapman.talktalk.net/Big%20Love%20slide_18.jpg
---The Velocity of Debt------------- Not sure what it means but it has an end of the world ring to it. Could it be that Increased income makes entities (individuals, business, governments) create more obligation/debt? Do Decreased incomes generate more debt to pay off existing expenses?
Having watched California since 1960, it seems that in the rock and roll good times, government wages and retirement kept growing. Government spending and individual spending were fueled by expanded population, agriculture, defense spending, aero-space, the computer revolution and associated manufacturing, and then the housing boom of rapid price and unit demand. Many who saw the retirement system payouts and increasing taxes, started to leave. In the late 1990s as the house of cards became apparent, money left with population. The homeowners of California are way upside down with huge unemployment. The State is broke. The velocity of debt may approach the velocity of light.
There are some lessons to be learned. When defense/aero-space spending was shut off, Americas best and brightest were selling used cars. When the computer revolution came, California decided it only wanted clean industry and drove out much manufacturing. The Fontana Steel plant was disassembled bolt by bolt and shipped to China. Then clean computer manufacturing later went to China. When the housing boom came, farm land became houses without adequate water supply and highways. Now they are empty and in foreclosure.
There was money to be made with the hardships of others. Small airplanes went real cheap after the aerospace/defense crash. Some went abroad, some to other states, but money was made on the thousands that left SoCal. Same with sport cars. The housing bust had all kinds of toys being dumped by mortgage and real estate people. Fortunately the Germans were buying container loads of used Porsches. I bought a lot of Porsches and heard some really sad stories.
Now, we hear that we can green grow our way out. I don’t think so. An educated population is necessary for productive growth. Most degrees now are of little value. If a kid has to borrow the money for college, it may be a bad decision.
The US must get back to broad base manufacturing. This is the only way we can create jobs for a diverse population of skills/no-skills and education/no-education. We do not have the after WW2 model to fall back on for any references cause it is a changed situation. I think we are in no mans land for reference points.
However, America has always been quick and bright with the ability to change quickly, unlike Europe and Japan. I think we will have a lost decade. The guys I know and knew that lived the 1929 to 1939 lost decade were damned good men. I am sure our girls and boys will improve the mess, but they do need a quality education. If there has to be a priority, this may be the one.
Ahem. "Jobs" are not something that the economy ought to care about.
We can manufacture here in the US. They were even manufacturing hummus in Queens until a little while ago (they headed South - lower taxes).
Look to Shenzen for a model for flexible manufacturing. Kevin Carson has written some great pieces on how to create decentralized, highly efficient manufacturing.
The issue is the demand side. Finding out what people want. Developing that demand. And delivering it to them.
Whether the manufacturing happens in the US or not matters little to me.
We can manufacture here in the US. With the (fluctuating) regulatory environment, it'll probably be easier. You can also get easy tax credits by starting up a carbon securities issuance firm and collecting your Al Gore buxx - if it's necessary.
Even in the aftermath of Shock and Awe in Baghdad, factories still operated, deals were still done, trade still continued... you may want to revise your beliefs about catastrophes.
I recommend Imperial Life in the Emerald City for reading on the money-pallet madness of Paul Bremer's pseudo-reconstruction. I mean, this bailout stuff is just more Bremerism. "Throw money at the problem, "wise" central planning, the rest will take care of itself.
You may also enjoy reading the back issues of the eXile, the paper that Matt Taibbi, Mark Ames, and John Dolan ran in Russia. That's a great primer on the half-mad Chicago School playbook.
Who's gonna be our Boris Yeltsin? Heh.
Blue collar workers in 50 states thank you for their consideration.
Isn't that the simple definition of a free market?
I'm starting to get an idea of your raison d'etre for posting around here.
I wonder what would have happened if we had just bombed them instead of occupying and infusing cash. Would that have been a catastrophe?
WTF?
I'm sympathetic to blue collar workers. Unfortunately, manufacturing has become more efficient than it used to be. There's no longer a need for massive factories that employ huge numbers of people for life. That kind of scale was only possible under government contractor regimes.
Now, the labor laws make it mostly too expensive to operate manufacturing plants here. Plus, there's a long case law of getting sued into oblivion for environmental pollution. Which is fine... corporations should be liable for the damages that they cause to communities... but the culture here is just all fucked up.
Would I love to help return blue collar jobs to the US?
ABSOLUTELY.
This is a complex issue. It's not like it's significantly better to run a factory overseas. There are huge hidden risks to operating in China and elsewhere. But there needs to be a full on revolution in the legal system for it to be feasible to do it. I'm a big believer in the vertically oriented firm (think Henry Ford minus the Nazism).
Sorry if this is unclear to you. There are certain states where it's marginally possible to open up a factory, but... I mean... are you aware of how much shit you have to go through to do it? We'll see in the coming years. There's a lot of possibility for innovation in manufacturing.
I'm crossing my fingers. Somehow the education system needs a reboot - geared for utility instead of philosophy. Give people some goddamn skills!
Jim Sinclair’s Commentary
There is no country or currency that can survive the wrath of an attack on their debt, the foundation of value, by credit default swaps. None.
Furthermore, all major currencies will all be attacked over the next 24 months.
A Period of Paucity
Ok. Let us clear something up right off the bat. America's projected Debt/GDP IS NOT between 74-96%, as per the graph above. I'm sure that this research is using publically released and accredited stats, BUT they are shite. Let us dispense with the FASB like cooked stats shall we? The real US Debt/GDP is well over 300%. THE REAL DEBT/GDP IS OVER 300%! This glaring fact dwarfs Depression era comparisons, and what was the outcome socially, economically, and politically of that period in history?
The real debt to gdp is really all anyone needs to know about this whole mess. All needs one must due is ponder this chart....
http://theinternationalperspective.files.wordpress.com/2010/02/debt-to-g...
Depression, or HyperInflation.
1930's on steroids, the world economy looking like the tulip mania chart.
OR
We get hyperinflationary hell. DOW 20k, $10 milk and gas.
Both of the above conditions, when experienced tend to lead to societal instabilities ranging from rebellion, social movements, wars, world wars, currency changes, periods of tyranny, famine....etc....
Austerity? The choices for the citizens, country by country, are nation crushing depression, or being scorched to well done by hyperinflation; if you have a printing press. Sir, would you prefer die or be a male sex slave eunuch? Well there is another choice, apparently, there is the option to freak out, revolt, burn stuff, hang people, start wars, and throw up new governments and dictatorships. Austerity is for the bottom 90%, like the laws, and people apparently don't like sacrificing while monied interests are being "stimulated" for the peoples' own good and against their will.
This is game over. The world we've known for at least a few generations is about to end, and most likely very badly by the looks the current lie and smile while it falls apart strategy. Prepare yourself, and your family, what's coming down the pike is going to make the History books, and maybe the religious texts. There are solutions, there are actions that could be taken, but at this point it's like a cheesy horror flick set up murder. I'm still holding out praying for societal evolution pre or post collapse, but if History is any guide we're going to have to go through hell to get to heaven. Millions, perhaps billions, will die. This is an old old story with but variations on the theme.
ZeroHedge does the details, a daily grind of pointing out hypocrisy, lies, fraud, booktalking, corruption, and inside finance. Realize what it is though, minutae. The US along with its banking cartel is insolvent, along with the rest of the world's economies. The debts will not be paid. There is only hyperinflation and super depression, or both. The devil's in the details. I want a stake in what's to come if I can survive, and doing that means staying informed with sites like ZeroHedge. The outcome of this game though, was never in doubt.
+1
You know it crab cake.Prepare for impact folks.
right-on
If the deflation argument is the correct outcome, it would seem to me that a: "SELL gold/BUY grains/sugar," would be the operative hedge. 6+ Billion people to feed can't be wrong. And, since agricultural exports make up a very large percentage of U.S. exports, could be the factor that keeps the US$ a more desirable currency. If the scenario painted is incorrect, and inflation persists, betting on agriculture would seem to be a good wager.
An easy way to buy (paper) grains and sugar is the ETF whose ticker is DBA. 25% wheat, 25% corn, 25% soybeans and 25% sugar. DBA is not (far as I know) leveraged.
Disclosure: I own DBA and gold. Covering more bases if you will.
Not necessarily. Remember, Gold is not purely an inflation hedge but instead a hedge against uncertainty and deflation brings more uncertainty than inflation. This explains, partly, why we have a rally in PM's, USD and Treasuries simultaneously. Under any other circumstances, when you combine these rallies with a stock market bull run, then it's safe to say that the US economy is strong and healthy......but of course we all know otherwise.
This is not a plug. Listen to Alex Jones. We are about to enter a world of Lords and Serfs. Keep your heads up and good luck..
Like I said. We have an hour...possibly two. Make no doubt about it...the ship will founder.
How about a wild card - the black death. It was Europe's economic renaissance last time. Roughly equivalent to a virulent 'flu epidemic, wouldn't you say? Now, where can we get one of those...
I thought, "surely you jest?", but alas they even have a vaccine for the plague nearly ready to administer to the lemmings upon outbreak: http://www.eurekalert.org/pub_releases/2008-07/uocf-upd073008.php
wash, rinse, spin...repeat
Guy you are seriously missing France in this, they may have not done much in austerity measures yet but check how much exposure they have (incl their banks) to Greece and then compare that to their own GDP.... France is the country that will send the chockwaves through the world when Greece defaults, yeah i still think Greece has no other option.
Regarding the U.S. deficit, I recommend this recent video, its a good summary for some of the things that are discussed on this website:
http://youtube.com/watch?v=eb1n1X0Oqdw
To add to what we know above, the Times has reported that the new UK government is accusing Labor of hiding billions of spending commitments in what it calls a scorced earth policy.
http://www.timesonline.co.uk/tol/news/politics/article7127819.ece
This reminds me of a similar condition in greece when the new government disclosed that the old one had hidden the true size of the deficit. We all know how that turned out...
I have a feeling we are going to be hearing about a lot more about austerity measures in Britain in the months to come.
A good article about comming austerity in developed world:
http://blogs.telegraph.co.uk/finance/edmundconway/100005702/us-faces-one...
My bullish USD warnings since 2009 on weekly and monthly charts have not changed and further USD strength and thus EURO weakness is still expected, so USD rally and EURO downtrend will continue.
http://stockmarket618.wordpress.com
http://www.zerohedge.com/forum/latest-market-outlook-1
You suck. I could say it more eloquently, but... I don't feel like it.
SPAM
At least Harry the Teeth has something to say, and communicates, but you haven't even got that going for you.
I wouldn't click on your link, which you've plastered on every thread, if you paid me.
He has dedication, yes he has. Hoping for eyeballs. If only we could get other Zhers to ignore the paperbug spammers in the same manner. Not even worth a response.
As I said to you in the other post, the charts are great and the information is appreciated, but your posting on every single page as opposed to pages where the information is relevant makes your posts seem like junk mail and detract from whatever good you are trying to accomplish. Can you help us out TD?
no doubt US ruling class austerity will commence immediately following implementation of the $23,000,000,000 'save the teachers' liquidity facility. It's "for the children" you know.
NY Times writer Tom Friedman was on Charlie Rose this week. He said “The tooth fairy died". His mindset seemed in line with what I see here on ZH and hear from my friends. I am not a huge fan of Tom, but he is connected and does travel with the purpose of knowledge gain.
Let me respond to the reply posts about domestic jobs. The concept of we have to “grow our way out of this” is oft times repeated. If jobs are a part of that solution, then jobs across the board have to be in the equation. The last 40 years have been a transition from rooms of women banging away on typewriters with a sheet of carbon paper between at least 2 sheets, hoards of workers in auto plants, steel plants, mining, aircraft factories, shoe factories and on and on. There was a demand for semi-skilled and skilled labor. A boy who got a c/b average in high school and served his draft requirement could support a family without the wife working. If the wife was a school teacher, nurse, or upper secretary, they had large money.
This last housing boom created jobs for those workers, and now the gloom spells the end of that time zone for America. We are at the time where most jobs are beyond the skill/education/IQ level of a too large percentage of Americans. The computer made too many Americans obsolete and the recovery time is in decades, which we do not have. The off shore economy has also failed and taken the USA with it. Off shore corporate headquarters in Ireland and the Islands need to be address so that the money can be kept in the US at a tax rate that will bring home our major corporations.
Washington is not able or willing to cope with the obvious. The situation is clear, the need obvious, and action is required.
You need to label the "debt due" row which I assume is in billions.
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