Why It Really All Comes Down To The Death Of The Petrodollar

Tyler Durden's picture

Last week, in the global currency war’s latest escalation, Kazakhstan instituted a free float for the tenge. The currency immediately plunged by some 25%. 

The rationale behind the move was clear enough. The plunge in crude prices along with the relative weakness of the Russian ruble had severely strained Kazakhstan, which is central Asia’s largest crude exporter. As a quick look at a chart of the tenge’s effective exchange rate makes clear, the pressure had been mounting for quite a while and when China devalued the yuan earlier this month, the outlook for trade competitiveness worsened. 

What might not be as clear (on the surface anyway) is how recent events in developing economy FX markets following the devaluation of the yuan stem from a seismic shift we began discussing late last year - namely, the death of the petrodollar system which has served to underwrite decades of dollar dominance and was, until recently, a fixture of the post-war global economic order. 

In short, the world seems to have underestimated how structurally important collapsing crude prices are to global finance. For years, producers funnelled their dollar proceeds into USD assets providing a perpetual source of liquidity, boosting the financial strength of the reserve currency, leading to even higher asset prices and even more USD-denominated purchases, and so forth, in a virtuous (especially if one held US-denominated assets and printed US currency) loop. That all came to an abrupt, if quiet end last year when a confluence of economic (e.g. shale production) and geopolitical (e.g. squeeze the Russians) factors led the Saudis to, as we put it, Plaxico'd themselves and the US.

The ensuing plunge in crude meant that suddenly, the flow of petrodollars was set to dry up and FX reserves across commodity producing countries were poised to come under increased pressure. For the first time in decades, exported petrodollar capital turned negative. 

That set the stage for a prolonged downturn in emerging market currencies, and as worries about China’s economy - the engine of global growth and trade - grew, so did the pressure.

Thus when Beijing moved to devalue the yuan, it drove a stake through the heart of the EM world by simultaneously i) validating concerns about weak Chinese growth, thus guaranteeing further pressure on commodities, ii) delivering a staggering blow to the export competitiveness of multiple emerging economies, iii) depressing demand from the mainland by making imports more expensive. Thanks to the conditions that resulted from the death of the petrodollar (e.g. falling FX reserves and growing fiscal headwinds), the world’s emerging markets were in no position to defend themselves against the fallout from the yuan devaluation. Complicating matters is a looming Fed hike. Included below is a look at flows into (or, more appropriately, "out of") EM bonds. As Barclays notes, the $2.5 billion outflow in the week to August 21 is the highest level since February of last year. 

We are, to put it mildly, entering a not-so-brave new world and the shift was catalyzed by the dying petrodollar. Kazakhstan’s move to float the tenge is but the beginning and indeed Kazakh Prime Minister Karim Massimov told Bloomberg on Saturday that the world has entered "a new era" and that soon, any and all petro currency dollar pegs are set to fall like dominoes. Here’s more:

Currency pegs in crude-producing nations are set to topple as the world enters a “new era” of low oil prices, according to the prime minister of Kazakhstan, which rattled markets this week with a surprise decision to abandon control of its exchange rate.


"At the end of the day, most of the oil-producing countries will go into the free floating regime,” including Saudi Arabia and the United Arab Emirates, Karim Massimov said in an interview on Saturday in the capital, Astana. "I do not think that for the next three to five, maybe seven years, the price for commodities will come back to the level that it used to be at in 2014."


Central Asia’s biggest energy producer cut its currency loose on Thursday, triggering a 22 percent slide in the tenge to a record low versus the dollar. The move followed China’s shock devaluation of the yuan the week before, which drove down oil prices on concern global growth will stutter and nudged nations with managed exchange rates toward competitive devaluations of their own.


More than $3.3 trillion has been erased from the value of global equities after China’s decision spurred a wave of selling across emerging markets. Brent crude touched a six year-low of $45.07 per barrel on Friday, while the Dow Jones Industrial Average entered a correction.


“After I watched what is happening on the financial market and stock market in the U.S. on Friday night, I thought that we did it at the right time,” Massimov, 50, said in his office in the government’s headquarters. The decision avoided “big speculation and pressure this weekend in Kazakhstan,” he said.


The central bank spent $28 billion this and last year to support the tenge, including $10 billion in 2015, Kazakh President Nursultan Nazarbayev said this week. After its slump on Thursday, the currency rallied 7.4 percent to close at 234.99 against the dollar a day later. The country’s dollar bonds due July 2025 climbed after the announcement, lowering the yield nine basis points to 5.74 percent in the last two days of the week.


Before the currency shift, Kazakhstan was at a competitive disadvantage to Russia, its neighbor and top trading partner along with China. The tenge had fallen by only 7.6 percent against he dollar in the 12 months up to Aug. 20, compared with a 46 percent depreciation for the ruble, while crude had plummeted 55 percent in the period.

We discussed this in great detail on Friday (with quite a bit of color on the fiscal impact for Saudi Arabia) and we've included a chart from Deutsche Bank which should have some explanatory and predictive value below, but the big picture takeaway is that the world is now beginning to feel the impact of the petrodollar's quiet demise, and because this is only the beginning, we've included below the entire text of the petrodollar's obituary which we penned last November .

*  *  *

How The Petrodollar Quietly Died And Nobody Noticed

Two years ago, in hushed tones at first, then ever louder, the financial world began discussing that which shall never be discussed in polite company - the end of the system that according to many has framed and facilitated the US Dollar's reserve currency status: the Petrodollar, or the world in which oil export countries would recycle the dollars they received in exchange for their oil exports, by purchasing more USD-denominated assets, boosting the financial strength of the reserve currency, leading to even higher asset prices and even more USD-denominated purchases, and so forth, in a virtuous (especially if one held US-denominated assets and printed US currency) loop.

The main thrust for this shift away from the USD, if primarily in the non-mainstream media, was that with Russia and China, as well as the rest of the BRIC nations, increasingly seeking to distance themselves from the US-led, "developed world" status quo spearheaded by the IMF, global trade would increasingly take place through bilateral arrangements which bypass the (Petro)dollar entirely. And sure enough, this has certainly been taking place, as first Russia and China, together with Iran, and ever more developing nations, have transacted among each other, bypassing the USD entirely, instead engaging in bilateral trade arrangements, leading to, among other thing, such discussions as, in today's FT, why China's Renminbi offshore market has gone from nothing to billions in a short space of time.

And yet, few would have believed that the Petrodollar did indeed quietly die, although ironically, without much input from either Russia or China, and paradoxically, mostly as a result of the actions of none other than the Fed itself, with its strong dollar policy, and to a lesser extent Saudi Arabia too, which by glutting the world with crude, first intended to crush Putin, and subsequently, to take out the US crude cost-curve, may have Plaxico'ed both itself, and its closest Petrodollar trading partner, the US of A.

As Reuters reports, for the first time in almost two decades, energy-exporting countries are set to pull their "petrodollars" out of world markets this year, citing a study by BNP Paribas (more details below). Basically, the Petrodollar, long serving as the US leverage to encourage and facilitate USD recycling, and a steady reinvestment in US-denominated assets by the Oil exporting nations, and thus a means to steadily increase the nominal price of all USD-priced assets, just drove itself into irrelevance.

A consequence of this year's dramatic drop in oil prices, the shift is likely to cause global market liquidity to fall, the study showed.

This decline follows years of windfalls for oil exporters such as Russia, Angola, Saudi Arabia and Nigeria. Much of that money found its way into financial markets, helping to boost asset prices and keep the cost of borrowing down, through so-called petrodollar recycling.

But no more: "this year the oil producers will effectively import capital amounting to $7.6 billion. By comparison, they exported $60 billion in 2013 and $248 billion in 2012, according to the following graphic based on BNP Paribas calculations."

In short, the Petrodollar may not have died per se, at least not yet since the USD is still holding on to the reserve currency title if only for just a little longer, but it has managed to price itself into irrelevance, which from a USD-recycling standpoint, is essentially the same thing.

According to BNP, Petrodollar recycling peaked at $511 billion in 2006, or just about the time crude prices were preparing to go to $200, per Goldman Sachs. It is also the time when capital markets hit all time highs, only without the artificial crutches of every single central bank propping up the S&P ponzi house of cards on a daily basis. What happened after is known to all...

"At its peak, about $500 billion a year was being recycled back into financial markets. This will be the first year in a long time that energy exporters will be sucking capital out," said David Spegel, global head of emerging market sovereign and corporate Research at BNP.


Spegel acknowledged that the net withdrawal was small. But he added: "What is interesting is they are draining rather than providing capital that is moving global liquidity. If oil prices fall further in coming years, energy producers will need more capital even if just to repay bonds."

In other words, oil exporters are now pulling liquidity out of financial markets rather than putting money in. That could result in higher borrowing costs for governments, companies, and ultimately, consumers as money becomes scarcer.

Which is hardly great news: because in a world in which central banks are actively soaking up high-quality collateral, at a pace that is unprecedented in history, and led to the world's allegedly most liquid bond market to suffer a 10-sigma move on October 15, the last thing the market needs is even less liquidity, and even sharper moves on ever less volume, until finally the next big sell order crushes the entire market or at least force the [NYSE|Nasdaq|BATS|Sigma X] to shut down indefinitely until further notice. 

So what happens next, now that the primary USD-recycling mechanism of the past 2 decades is no longer applicable? Well, nothing good.

Here are the highlights of David Spegel's note Energy price shock scenarios: Impact on EM ratings, funding gaps, debt, inflation and fiscal risks.

Whatever the reason, whether a function of supply, demand or political risks, oil prices plummeted in Q3 2014 and remain volatile. Theories related to the price plunge vary widely: some argue it is an additional means for Western allies in the Middle East to punish Russia. Others state it is the result of a price war between Opec and new shale oil producers. In the end, it may just reflect the traditional inverted relationship between the international value of the dollar and the price of hard-currency-based commodities (Figure 6). In any event, the impact of the energy price drop will be wide-ranging (if sustained) and will have implications for debt service costs, inflation, fiscal accounts and GDP growth.

Have you noticed a reduction of financial markets liquidity?

Outside from the domestic economic impact within EMs due to the downward oil price shock, we believe that the implications for financial market liquidity via the reduced recycling of petrodollars should not be underestimated. Because energy exporters do not fully invest their export receipts and effectively ‘save’ a considerable portion of their income, these surplus funds find their way back into bank deposits (fuelling the loan market) as well as into financial markets and other assets. This capital has helped fund debt among importers, helping to boost overall growth as well as other financial markets liquidity conditions.

Last year, capital flows from energy exporting countries (see list in Figure 12) amounted to USD812bn (Figure 3), with USD109bn taking the form of financial portfolio capital and USD177bn in the form of direct equity investment and USD527bn of other capital over half of which we estimate made its way into bank deposits (ie and therefore mostly into loan markets).

The recycling of petro-dollars has benefited financial markets liquidity conditions. However, this year, we expect that incremental liquidity typically provided by such recycled flows will be markedly reduced, estimating that direct and other capital outflows from energy exporters will have declined by USD253bn YoY. Of course, these economies also receive inward capital, so on a net basis, the additional capital provided externally is much lower. This year, we expect that net capital flows will be negative for EM, representing the first net inflow of capital (USD8bn) for the first time in eighteen years. This compares with USD60bn last year, which itself was down from USD248bn in 2012. At its peak, recycled EM petro dollars amounted to USD511bn back in 2006. The declines seen since 2006 not only reflect the changed  global environment, but also the propensity of underlying exporters to begin investing the money domestically rather than save. The implications for financial markets liquidity - not to mention related downward pressure on US Treasury yields – is negative.

* * *

Even scarcer liquidity in US Capital markets aside, this is how BNP sees the inflation and growth for energy exporters:

Household consumption benefits: While we recognise that the relationship is not entirely linear, we use inflation basket weights for ‘transportation’ and ‘household & utilities’ (shown in the ‘Economic components’ section of Figure 27) as a means to address the differing demand elasticities prevalent across countries. These act as our proxy for consumption the consumption basket in order to determine the economic benefit that would result as lower energy prices improve household disposable income. This is weighted by the level of domestic consumption relative to the economy, which we also show in the ‘Economic components’ section of Figure 27.

Reduced industrial production costs: Outside the energy industry, manufacturers will benefit from falling operating costs. Agriculture will not benefit as much and services will benefit even less.

Trade gains and losses: Lost trade as a result of lower demand from oil-producing trade partners will impact both growth and the current account balance. On the other hand, better consumption from many energy-importing trade partners will provide some offset. The percentage of each country’s exports to energy producing partners represents relative to its total exports is used to determine potential lost growth and CAR due to lower demand from trade partners.

Domestic FX moves are beyond the scope of our analysis. These will be tied to the level of openness of the economy and the impact of changed demand conditions among trade partners as well as dollar effects. Neither do we address non-oil related political risks (eg sanctions) or any fiscal or monetary policy responses to oil shocks.

GDP growth

The least impacted oil producing country, from a GDP perspective, is Brazil followed by Mexico, Argentina, Tunisia and Trinidad & Tobago. The impact on fiscal accounts also appears lower for these than most other EMs.

Remarkably, the impact of lower oil for Russia’s economic growth is not as severe as might be expected. Sustained oil at USD80/bbl would see growth slow by 1.8pp to 0.6%. This compares with the worst hit economies of Angola (where growth is nearly 8pp lower at -2%), Iraq (GDP slows to -1.6% from 4.5% growth), Kazakhstan and Azerbaijan (growth falls to -0.9% from 5.8%).

For a drop to USD 80/bbl, it can be seen (in Figure 27) that, in some cases, such as the UAE, Qatar and Kuwait, the negative impact on GDP can be comfortably offset by fiscal stimulus. These economies will probably benefit from such a policy in which case our ‘model-based’ GDP growth estimate would represent the low end of the likely outcome (unless a fiscal policy response is not forthcoming).

Global growth in 2015? More like how great will the hit to GDP be if oil prices don't rebound immediately?

On the whole, we can say that the fall in oil prices will prove negative, shaving 0.4pp from 2015 EM GDP growth. The collective current account balance will fall 0.58pp to 0.6% of GDP, while the budget deficit will deteriorate by 0.61pp to -2.9%. This probably has the worst implications for EM as an asset class in the credit world.

Energy exporters will fare worst, with growth falling by 1.9pp and their current account balances suffering negative pressure to the tune of 2.69pp of GDP. Budget balances will suffer a 1.67pp of GDP fall, despite benefits from lower subsidy costs. The impact of oil falling USD 25/bbl will be likely to put push the current account balance into deficit, with our analysis indicating a 0.3% of GDP deficit from a 2.4% surplus before. Fortunately, the benefit to inflation will be the best in EM and could help offset some of the political risks from reduced growth.

As might be expected, energy importers will benefit by 0.4pp better growth in this scenario. Their collective current account will improve by 0.6pp to 1.1% of GDP.

The regions worst hit are the Middle East, with GDP growth slowing to 0.3%, which is 3.8pp lower than when oil was averaging USD105/bbl. The regions’ fiscal accounts will also suffer most in EM, moving from a 1.7% of GDP surplus to a 1.8% deficit. Meanwhile, the CAB will drop 5.3pp, although remain in surplus at 3.9%. The CIS is the next-worst hit, from a GDP perspective, with regional growth flat-lined versus 1.91% previously. The region’s fiscal deficit will worsen from 0.7% of GDP to -1.8% and CAB shrink to 0.7% from 3% of GDP. Africa’s growth will come in 1.4pp slower at 2.8% while Latam growth will be 0.4pp slower at 2.2%. For Africa, the CAB/GDP ratio will fall by 2.4pp pushing it deep into deficit (-2.9% of GDP).

Some regions benefit, however, with Asia ex-China growing 0.45bpp faster at 5.5% and EM Europe (ex-CIS) growing 0.55pp faster at 3.9%, with the region’s CAB/GDP improving 0.69pp, although remain in deficit to the tune of -2.4% of GDP.

And so on, but to summarize, here are the key points once more:

  • The stronger US dollar is having an inverse impact on dollar-denominated commodity prices, including oil. This will affect emerging market (EM) credit quality in various ways.
  • The implications of reduced recycled petrodollars has significant ramifications for financial markets, loan markets and Treasury yields. In fact, EM energy exporters will post their first net drain on global capital (USD8bn) in eighteen years.
  • Oil and gas exporting EMs account for 26% of total EM GDP and 21% of external bonds. For these economies, the impact will be on lost fiscal revenue, lost GDP growth and the contribution to reserves of oil and gas-related export receipts. Together, these will have a significant effect on sustainability and liquidity ratios and as a consequence are negative for dollar debt-servicing risks and credit ratings.

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Seasmoke's picture

Kissinger the Petrodollar goodbye.

realmoney2015's picture

Anyone else think that omitted, secret pages of the 9/11 report are linking the attacks to the Saudis?

A warning that if they want to end the petro dollar that our bankers/government can lead us to war against them at any time.

We need to end the federal reserve and adopt a non-intervnetion foreign policy. Not isolation, trading with other countries will help relations and make for a more prosperous country.

There is a candidate running that is for these principals. That's why I'm donating half of the sales of my candles with silver coins (now through the 7th) to Rand Paul's moneybomb on September 7th: https://www.etsy.com/shop/ScentSavers?ref=hdr_shop_menu

Again, I'm not profiting on this. Since I'm broke this is my way of supoporting the candidate that could help rebuild our country after it all comes crashing down.

Of course you can donate directly to his campaign here: https://www.randpaul.com/

jeff montanye's picture


i hope you are right about rand paul.  i like his daddy better but nobody's perfect (hat tip to Osgood Fielding III).

as for 9-11 and the saudis, their role, imo, was peripheral.  larry silverstein, george bush's brother (who was in charge of wtc security), the cia, and the mossad seem far more central.  oh and dick cheney.


realmoney2015's picture

He's the best shot we got. If you look at his actions and votes he is just as good as his dad. He is watering down the message to try to reach the masses that are afraid of true liberty and freedom. Ron tried with two runs and was 100% pure in his words, nit just his actions. He was not successful in winning the nomination (Rand's goal) but was successful in waking up and educating a generation (Ron's goal). Anyone that likes Ron should support Rand. It's the same liberty principals, just packaged differently so the sheeple don't get spooked of 100% liberty!

Oh regional Indian's picture

As much as it is the death of the petrodollar, its' also the death of the Petro...

And I'll help that Petrodeath along....


HowdyDoody's picture

Rand Paul, unlike his father, is Israel's biatch.

THE 4th Quadrant's picture

That apple fell far far from the tree. Fraudulent fucker.

spanish inquisition's picture

In the midwest, a lot of people are swinging to Deez Nuts. at this moment I am taking a hard look at his platform.

Headbanger's picture


"The recycling of petro-dollars has benefited financial markets liquidity conditions. However, this year, we expect that incremental liquidity typically provided by such recycled flows will be markedly reduced, estimating that direct and other capital outflows from energy exporters will have declined by USD253bn YoY. 

The declines seen since 2006 not only reflect the changed  global environment, but also the propensity of underlying exporters to begin investing the money domestically rather than save. The implications for financial markets liquidity - not to mention related downward pressure on US Treasury yields – is negative."


BTW: Deez Nuts is a 15 year old boy having some fun with our fucked up political system: http://deeznutsforpresident2016.yolasite.com/

surf0766's picture

Raising rates will cause hyperinflation

realmoney2015's picture


Rand will end all foreign aid including aid to Isreal. Hardly sounds like he is Isreals biatch.

And 4th quadrant, 

Ron endorsed Rand just a few days ago. He also says he and Rand agree on 99% of the time. If you were to compare the Ron and Rands voting record while in Congress it would be hard to tell who's was whos. 

The way the MSM is ignoring Rand and saying that his campaign is failing and will drop out soon is just what they did to Ron. Ron took it all the way to the convention. Rand will too. Hopefully this time, we are more prepared for all the cheating.

realmoney2015's picture

If I am wrong and Rand does drop out (not likely) I will vote deez nutz as well.

swmnguy's picture

I've been voting since 1984.  I've always voted for the candidate who will end the wars, close overseas bases, knock a zero off the military budget; get corporate finance out of control of government, and enforce the law for everyone equally, regardless of wealth and station.

In other words, I've always voted for DEEZ NUTZ.

realmoney2015's picture

And Ron Paul in '88, '08, and '12 as he meets that criteria

SickDollar's picture



JRobby's picture

As long as we can keep building weapons, who cares about hyper inflation?

overmedicatedundersexed's picture

if the time ever comes that I, and most white/black/insert race here, americans wake up and say: the time for turning the other cheek is over..much more than the FRN is over.

(the object of security alphabet agencies  & the MSM/sports/entertainment owned by them-is to see that never happens)..that is why Trump has hit a nerve, enough of this 50yrs of open borders, and NWO free trade BS,divate sex is just as normal as apple pie BS, and killing babies is really mothers health issue..

trump like rand and ron can go only so far, step beyond the line and welcome to a Dallas open air ride in the sun...Trump is a risk taker, a  player, perhaps he will step over the line..

razorthin's picture

But Heez Nuts (Trump) is a real person.  Well, sort of.

Unfortunately, one of Deez Nuts will win.

The Wizard's picture

Obviously you don't know how to read the political landscape. All is not what is appears to be. If he is Israel's bitch, as you claim, how is it that he is spearheading an anti-fed campaign and against US imperialism.

msmith9962's picture

Of course.  Now that water becomes scarce they figure out how to make energy out of it.

THE 4th Quadrant's picture

Yea Dr. Greer is a cool guy. He explained some things to me like when I enter REM I sometimes astrally project, and I didn't even know WTF was going on. I'd remember but I was like nah, that didn't happen. That couldn't have happened... etc.. I found out most need rosicrucian meditation to project but for me it just happens in early REM.

Or, once a few year ago, one Sunday, I was thinking of something totally unique and a couple of ZH'ers posted a comment with a link, and they were like: "come'on dude, click the fucking link already", so I did and the resulting webpage was exactly what I was thinking about. Lol. True story. That was fun.
Singular consciousness experiments.

SilverDoctors's picture

In January, Jim Willie forecast that the US Dollar would not survive 2015.  
Seemed like a crazy forecast at the time...starting to look plausible... 

neilhorn's picture

I would like him, too if it weren't for the fact that he is a freshman senator with no experience, much the same as the flop who currently occupies the Whitehouse. Because he does not have enough life experience, I'm concerned that he would find the responsibility placed on his shoulders to be too heavy. While I don't think he will shirk the duty and simply say, "fuck it" and run away to the golf course, as does our current POTUS, I fear that he may try to do something that is not too well thought out.

If he would make a sacred oath to sign legislation to make executive orders illegal, rescind all previous executive orders, refrain from making any executive orders himself, place the IRS and Justice Dept. at arms length from the Presidency, abolish NSA data collection on American citizens, audit and punish fiduciary malfeasance at the Fed, and reduce the number of federal cabinet positions by 1/4, then I would trust Rand enough to support him. Otherwise, unless he makes some serious proposals to dial back the power and scope of the Presidency and the federal government, I believe he is just another goose in the flock.

bbq on whitehouse lawn's picture

How old was Alexander when he took and army across asia?
Something to think about.

jcdenton's picture

Read it and learn..


Although is was Saudi Intelligence together with the CIA and Mossad, there were no "dancing Saudis" in Fort Lee, New Jersey ..

Socratic Dog's picture

Since the 9/11 report was total bullshit, it doesn't fundamentally matter whether it links it to the Saudis or not.  It's lies.

Clearly fingering the Saudis was one option built in to the bombings, thus the (imaginary, still alive after the event) Saudi hijackers.  But for some reason, fingering Al Qaida (also imaginary) won out on the day.

If Rand, or any other candidate, starts talking sense about 9/11,  he will be deserving of support, for the short period of time before he ihas a nail gun accident.  I really think 9/11 is the major story of our time, bigger than the Fed, because it ties everything together.  If you understand the zios did 9/11, you understand they are behind most everything.  Including the Fed, economic collapse, and tyranny in the USSA.

Incidentally, Trump apparently said tonight he's all the way with police state USSA.  What the fuck.  I hope that gives all you Trump fan boys here pause.  It bloody well should.

JRobby's picture


Diversions galore because they know the sheep ain't happy no more. They have a plan. We are seeing the execution. We don't have a plan.

We have families and real estate. Maybe a few $$$$ saved (laugh track deafening) We are short on Patriots.

detached.amusement's picture

right, I had to laugh, I never knew Plaxico shot himself ON PURPOSE...


ImGumbydmmt's picture

Patriot Here!

We are Legion. Truly.

Please do not mistake our inaction for cowardice.

For many of us it is only our love for our wives and children which has stayed our hand from action beyond keyboarding rants to our congressmen and speaking at town halls and state committee meetings.


I drove 8 hour round trip to my state capital with my wife and toddler to wait 7 hours to be allowed to speak for 2 minutes in protest to a gun control bill. Hundreds of partiots were with me including this gentleman


We were the only ones from our far flung county to attend and our local congressman spoke first form the committee to thank us and explain than we were the first ones from his country because of the distance, but he received 3,000 emails in opposition and 3 in favor.

Multiple county sheriffs appeared to voice opposition, and promise non enforcement, non compliance if the measure was passed including the sheriffs of the two counties adjacent to us.

Patriots are among us all.

Many are the Jack Hinson of our day.


A time is coming where a line will be crossed and the world will see American Patriots once again.

WE will not need a leader to emerge, we may not have a plan today, but we have our strength of character and the example Hinson, and a vast sea of Patriots to inspire us on that fateful day.

Even from abroad we, each of us here, can draw strength for the words and deeds of great men, who came before us.

Winston Churchill


Still, if you will not fight for the right when you can easily win without bloodshed; if you will not fight when your victory will be sure and not too costly; you may come to the moment when you will have to fight with all the odds against you and only a precarious chance of survival. There may even be a worse case. You may have to fight when there is no hope of victory, because it is better to perish than live as slaves.

We shall go on to the end, we shall fight in France,
we shall fight on the seas and oceans,
we shall fight with growing confidence and growing strength in the air, we shall defend our Island, whatever the cost may be,
we shall fight on the beaches,
we shall fight on the landing grounds,
we shall fight in the fields and in the streets,
we shall fight in the hills;
we shall never surrender, and even if, which I do not for a moment believe, this Island or a large part of it were subjugated and starving, then our Empire beyond the seas, armed and guarded by the British Fleet, would carry on the struggle, until, in God’s good time, the New World, with all its power and might, steps forth to the rescue and the liberation of the old.”

General Mattis, USMC (41 year career)

“Be polite, be professional, but have a plan to kill everybody you meet.”

“We’ve backed off in good faith to try and give you a chance to straighten this problem out. But I am going to beg with you for a minute. I’m going to plead with you, do not cross us. Because if you do, the survivors will write about what we do here for 10,000 years.”



Andrew Jackson

You must pay the price if you wish to secure the blessing.


Take time to deliberate; but when the time for action arrives, stop thinking and go in.



Americans are not a perfect people, but we are called to a perfect mission.



John Adams

Our Constitution was made only for a moral and religious people. It is wholly inadequate to the government of any other.

I must study politics and war that my sons may have liberty to study mathematics and philosophy.
Read more at http://www.brainyquote.com/quotes/authors/j/john_adams.html#MchBAZ6UmTK8...


Because power corrupts, society's demands for moral authority and character increase as the importance of the position increases.



There is danger from all men. The only maxim of a free government ought to be to trust no man living with power to endanger the public liberty.


Power always thinks... that it is doing God's service when it is violating all his laws.


Samuel Adams

Our contest is not only whether we ourselves shall be free, but whether there shall be left to mankind an asylum on earth for civil and religious liberty.


It does not take a majority to prevail... but rather an irate, tireless minority, keen on setting brushfires of freedom in the minds of men.

Among the natural rights of the colonists are these: First a right to life, secondly to liberty, and thirdly to property; together with the right to defend them in the best manner they can.


So Dear Readers,

Set the brush fires of Freedom among your kin and friends as best as you are able. Use every forum available to you in the society of men, whether at your trade, your home your church or your online doings let your speech and deed always proclaim what America was Meant For. Remind those of sound mind what we were created from and what our true birthright is upon this earth.

And Lord forbid, if/when your Jack Hinson Moment arises, do not despair and be led away like many in the Holocaust,  but to the take to the hills, leave your earthly goods behind except your bag and rifle and extol a retribution upon tyranny that the world will never forget.

Live is meant to be LIVED and lived well.

As much as I converse with sages and heroes, they have very little of my love and admiration. I long for rural and domestic scene, for the warbling of birds and the prattling of my children.

-          John Adams


When the prattling of our children is taken from Patriots, truly the time to act may be far, far too late we admit, but act we will, and the world will not forget it for 10,000 years.

JRobby's picture

Thank you for your post and your efforts.

We were the only ones from our far flung county to attend- clearly there were some KFC 2 for 1 flyers out where you live.

swmnguy's picture

Indeed.  Remember when the BBC found something like 14 of the 19 "hijackers" in the year after 9/11?  I remember the interview with Mohammed Atta, the Egyptian doctor, who rather obviously had not flown the first plane into the WTC.

And anybody who has been impressed by Trump is giving an object lesson in what happens when you see what you want to see.  Nobody who has followed the guy seriously for any length of time would have any dealings with him at all, much less support him in a political campaign.

Grumbleduke's picture

"If Trump wins, then it's tyranny. If Clinton, then it's war." - Gerald Celente -

JR's picture

All the Trump statements and issues seem to fly away except one: and the immigration issue signals the greatest cultural warning to Americans since Paul Revere’s ride. Americans, and they’re not only Republicans, are exploding with their support of Trump. If one spear carrier will try and save the European white culture embodied in the phenomenal progress of America they will follow.


If you think the white culture is not severely threatened, check out this comment by Clint Eastwood’s 29-year-old son, Scott, in an interview with Carmel (CA) magazine now appearing in its summer/fall issue.

Carmel Magazine: Just curious, since you were originally from California, was it hard to fit in with the locals in Hawaii?

Scott Eastwood: Yeah, it’s funny you bring that up,  because we were just talking about that the other day…there was a lot of anger and hatred to the white people in Hawaii by the locals. As a young guy, I was definitely called ‘haole boy’ and made fun of. But ultimately at the end of the day, I think it was good and manned me up a little. I enrolled in football and had to kind of grow up getting in fistfights at school. It’s amazing though, once you get a common ground with a team sport like that, you can sort of bridge that gap.

stopthejunk1's picture

Stop wasting your money on Rand Paul. He will never be elected.

Libertarians will never be anything but fringe unless and until they develop a coherent geopolitical worldview. Personally I doubt they ever will; they are too simplistic, on everything from foreign policy to economics. This explains their appeal to a certain tranche of the public that views life as a morality play and simply cannot tolerate the idea that global economic policy decisions are too complex and nuanced to fit on a bumper sticker.

Billy the Poet's picture

Liberty is bad because if you had it you couldn't be owned. So be happy.

dltff-ya's picture

I like Ron Paul but Rand is not an honest person, and I fear and distrust him.

He could fix that if he can explain this lie to me. I can't support such a

weasel that would lie like that about something this important. I guess I will write in somebody.  Maybe Pat Buchanan, the last politician I truly liked for any length of time.


This is personally sad for me. The end of hope within the US  media culture and political system.


But it was the lie that vanquished that hope.

In questioning Secretary of State John Kerry at a hearing on the Iran deal before the Senate Foreign Relations committee, Sen. Paul cited what he said were the Ayatollah Khamenei’s words:

“The Americans say they stopped Iran from acquiring a nuclear weapon. They know it’s not true.”

Claiming that this contradicts the administration’s contention that the deal “would prevent [the Iranians] from getting a nuclear weapon,” Paul averred that “the Ayatollah is saying the opposite.”

But what did Khamenei really say? Here’s the entire quote:

The Americans say they stopped Iran from acquiring a nuclear weapon. They know it’s not true. We had a fatwa, declaring nuclear weapons to be religiously forbidden. It had nothing to do with the nuclear talks.”

This was no mistake on Rand Paul’s part. It was a lie, and he repeated the lie to Fox News in an interview with the Lou Dobbs:

amarchhareinmay's picture

I don't understand all the down votes. I thought the Saudi connection was a foregone conclusion...

Rearden-Steel's picture

"In other words, oil exporters are now pulling liquidity out of financial markets rather than putting money in. "

So essentially they are selling oil (priced in USD) at a loss. Countries selling a tangible commodity (with a price manipulated) are losing wealth under the artificial Petrodollar system. This will not last.

At what point do they finally wake up to the ponzi and natural law takes over?

In our lifetimes. Prepare.

AE911Truth's picture

They know it is just a matter of time until the whole world knows their oil is worthless, so they are selling as much as they can as fast as they can at any price they can get. So, why is oil about to become worthless? See this:


fiftybagger's picture

I suppose one could argue they are suppressing the price of oil the same way they are suppressing the price of gold and silver.  Paper oil?  Not likely.  Cold fusion and energy from little green men?  I'll believe it when I see it.  Ongoing depression in the United States being joined now by the east?  Alex, I think we have a winner!

U.S. Total Gasoline Retail Sales by Refiners (Thousand Gallons per Day)


Silver For The People

amarchhareinmay's picture

Agreed. It's really just as simple as a collapse in demand.

KnuckleDragger-X's picture

Its not dead, its pining for the fjords.....

ILLILLILLI's picture

It's all good...until it's not.