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How Bad Can This Get, And How Fast?
Submitted by Raul Ilargi Meijer via The Automatic Earth,
There’s so much negative real bad economic and financial news out there that it’s hard to choose a ‘favorite’, but I guess I’m going to have to go with what underlies and ‘structures’ it all, the IIF stating that for the first time since 1988 and the Reagan presidency, there’s more money flowing out of emerging markets than there’s flowing in. That is for sure a watershed moment.
And no, that trend is not going to be reversed either anytime soon. Emerging economies, even if they wouldn’t include China -but they do-, have relied exclusively on selling ‘stuff’ to the rich world which combined cheap commodities with cheap labor, and now they see their customer base shrink rapidly just as they were preparing to harvest the big loot.
Now, I hope I can be forgiven for thinking from the get-go that this was always a really dumb model. That emerging nations would provide the cheap labor, and the west would kill of its manufacturing base and turn into a service economy.
This goes very predictably wrong if and when we figure out that A) economies that don’t manufacture anything can’t buy much of anything, and B) that we can sell those services our economies are ‘producing’ only to ourselves, as long as the emerging nations maintain a low enough pay model to make their products worth our while to import.
It makes one wonder how many 6 year-olds would NOT be able to figure this out. In the same vein, how many of them would be hard put to understand that our economies, overwhelmed by, and drowning in, debt, cannot be rescued by more debt? Here’s thinking the sole reason so many of us don’t get it is that we’ve been told it’s terribly hard to grasp, and you need a 10-year university course to ‘get it’.
I see a bad US jobs report coming in as we speak, and that’s not really saying much of anything. The damage not only runs far deeper than those massaged reports, it’s also already been done ages ago. Non-farm employment reports are Brooklyn Bridge-for-sale territory.
We’d all be much better off looking at the $11-13 trillion in ‘value’ lost from global equity markets in Q3. Or, for that matter, at Goldman’s statement that, and I’m only slightly paraphrasing here, only companies buying up their own stocks could save the S&P 500 for 2015.
Think about it: we don’t make much of anything anymore, and what we do make hardly anybody wants to buy, so we issue debt and buy it up ourselves. This may well be presented as a clever ‘investment’ model, but I aks of you: how much closer to eating our own excrements are we comfortable getting?
Stock buybacks can have strategic advantages in specific circumstances in healthy economies, but massive buybacks on the back of too-cheap credit/debt is not one of those circumstances. It’s desperation writ very large.
One other article that stuck out, because it brings into the bright shining limelight the longtime Automatic Earth assertion that we are headed for a disastrous “multiple claims to underlying real wealth”, is Paul Brodsky’s piece served by Tyler Durden. It has far more value than any alleged jobs article, because it describes the real world, not some distorted fantasy:
There Are Five Times More Claims On Dollars As Dollars In Existence
[..] the data show plainly there are five times as many claims for US dollars as US dollars in existence. Does this matter to investors? Well, yes, it matters a lot. Not only is there not enough money to repay outstanding debt; the widening gap between credit and money is making it more difficult to service the debt and more difficult for nominal US GDP to grow through further credit extension and debt assumption.
Remember, only a dollar can service and repay dollar-denominated debt. Principal and interest payments cannot be made with widgets or labor, only dollars. This means that future demand and output growth generated through more credit issuance and debt assumption is self-defeating. In fact, it adds to the problem.
[..] the value of dollar-denominated assets is not supported by the money with which it is ostensibly valued. This has not been a problem historically because the proportion of un-reserved credit has been low relative to asset values and cash flow. As we are seeing today, however, it is becoming a significant problem because balance sheets are already highly levered and zero-bound interest rates chokes off the incentive to refinance asset prices higher.
If the total value of US denominated assets is, say, $100 trillion, and the US dollar money stock is somewhere around $12 trillion, then the inescapable implication is that the market’s expects either: a) $88 trillion more US dollars will be created in the future to fund the purchase of the gross asset pool at current valuations; b) there has to be a decline in the nominal value of aggregate assets, or; c) both.
The US is not going to ‘create’ $88 trillion. More debt cannot solve this. And so the only option available is a huge decline in asset ‘values’. ‘Values’ that have been grossly distorted for years now, and which we all could have known can’t be kept from falling back to earth indefinitely.
Just Friday morning, we saw 3 other key indicators all point way down. That’s not in itself peculiar or anything, what’s peculiar is that it’s taken so long for people to figure out which way the wind blows. And I betcha, most still won’t get it. Because they’re all exclusively looking for signs of a recovery.
They’ve been looking for 8 years or so now, and there’s always some piece of data that can be found to feed the blinders, but it’s all been nonsense for 8 years running. Your economy, my economy, and the global economy, can and will not recover, and certainly not as long as more debt is injected in our already insanely overindebted financial systems.
You can’t fight historically unequaled amounts of debt with even more debt. But yeah, well, that’s the only trick our pony can think of. Those 3 key indicators -and there’s more where they came from- are the Guardian Gauge: ‘Destruction Of Wealth’ Warning Looms Over Stocks, the Global Dow: Key Global Equity Index Has Fallen Off The Precipice and the IIF’s take on net capital flows for global emerging markets I started out with, Is This The Mother Of All Warnings On Emerging Markets?
I don’t want to make this another of those endless articles, but do click the links, and do read up on each of them. And then shiver. Have a stiff drink. Unless you’re still looking for a recovery. And let’s not forget, yes, it’s true that massive stock buybacks in the US, Europe, perhaps even China, as well as more QE to infinity and beyond, may save a bunch of numbers and you might be sitting pretty yet under the yuletide tree.
But the simplest of principles stands no matter what: there’s no way out of this that doesn’t lead through the exact kind of massive debt deleveraging that all governments and central banks are ostensibly trying desperately to prevent. And which will make the debt deflation, certainly after 8 years of trying to push the 180º opposite way, epic and monumental.
On the bright side: at least if you would have read the Automatic Earth through those past 8 years, you would have known and hopefully been prepared for that debt deflation. It’s not as if it’s something new or unexpected, not around here.
$13 trillion in market losses in just one quarter would be very hard to make up for even in very favorable circumstances. We have no such circumstances. We’ve built our very lives on squeezing China et al for 27 years, and issuing more debt as if there’s no tomorrow - sort of a self-fulfilling prophecy -, and now we’ve belatedly realized that there’s a time limit on that model.
But hey, by all means, it’s your money, and it’s your life, so do keep on betting on that recovery, and the return to ‘normal’, whatever that once was. Put it all on red. Go crazy! You do risk becoming a lonely crowd though. Meanwhile, those of us down here with our feet planted in the real earth have just this one question: “How bad can this get, and how fast?”.
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Very. Buckle up!
Not until they've taken your guns away. Then it's on like Kong...
How bad can it get?
Bad enough to make your life a misery, but not so bad as to make you choose to get out and change it.
"But hey, by all means, it’s your money, and it’s your life, so do keep on betting on that recovery, and the return to ‘normal’, whatever that once was. "
Normal seems to be defined as the time prior to the 2001 meltdown, only that was far from normal. Things like the Internet and Y2K don't come along every day and everyone seems to think we can get back to that time period. Bubble after bubble have been blown trying to get back to an anomaly, which lead to it's own bubble and bust.
This guy does not understand the fundamental concept of money velocity. They don't have to create 88 Trillion dollars to balance the 100 trillion dollars of assets with dollars in existence. To allow that to come into balance they only have increase the money velocity by a few dozen percent, unfortunately that can occur over night, and not just a few dozen percent but several hundred percent.
An increase in money velocity makes it appear as if there are more dollars in existence, and in a scenario of rapidly increasing money velocity, depending on the severity, real assets such as equities, real-estate, gold, silver, food and toilet paper would increase in nominal value so rapidly that the 100 trillion total asset pie would balloon even with the devaluation of the debt portion of that pie. This phenomenon is high or hyperinflation. It is not the amount of dollars that causes very high or hyperinflation, though it doesn't hurt and is often the catalyst, it is the rapid increase in money velocity that sends the monetary system into an inverted tailspin.
The lions share of money wizzing around is borrowed money. Reduce borrowing and you hammer velocity big time.
We don't have a debt problem (if you accept/support the debt based system) we have a borrower problem.
Not enough borrowers borrowing, and not enough lenders lending.
Banks borrowing does very little for velocity and Gov borrowing also doesn't cut the mustard.
What we need is a new law on the books that demands that every living breathing person on the planet borrow on a daily basis...yeah that will do it.
Money velocity has sucked for several years now since the Fed targets their money gun at a few special players instead the actual economy. 500 billion targeted at the ground level economy in the forms of new business and investment along with repealing all the screwed up laws that are killing small business would actually give us the things that the Fed are claiming as their objective......
To many codes, rules, and other tosh that keeps anyone from starting a business, much less a successful one. These are moats that keep competition out inflating prices. Subsidies are another way of inflating asset prices.
But mostly its just having laws and rule set built on and around gold that is now being used without that key metric.
Removing gold from the political and legal system broke it. The rest is just fallout.
It's all by design...
There was a time it was likely believed the System couldn't "create" a billion dollars. Then a trillion. Certainly, given enough time, these apparatchiks can conjure up a cool quadrillion or two?
Even little ol' Zimbabwe could do that. And Venezuela is on that road, with Brazil bringing up the rear.
Velocity will do it, as soon as some folks perceive that it is all pulling away from them.
The technological revolution has done one key thing:
It has made a lot of stupid ass idiotic fools whose lives are used up staring into a handheld screen to see what someone somewhere they never met, and never will meet ate for breakfast. Useless lives, useless tech, useless society.
I hope you have a LOT of popcorn this show will be interesting, and you can sell the popcorn to those who put it all on red...or black... or zerozero for that matter. NOBODY wins when the end result is your phone melting in your hand...even those who caused said melting.
Then again, if your life is spent staring into a stupid electronic box, you probably don't care anyway. I wouldn't if that were what my life consisted of day after day.
Does happiness require being slightly miserable? Are humans most capable when they are in a miserable state?
https://www.youtube.com/watch?v=GLQ2TIul8pI
It is articles like these on ZH that encourage readers to take massive short positions which the CBs and IBs will squeeze to death before EOY in an attempt to maintain the illusion that "all is ok." See you at ES 2100, when you have 3 or 4 surplus assholes ripped into you, suckers.
Massive short positions? LOL! What percentage of ZH readers do you imagine are playing in the rigged casino?
Spot on Tinky.
Who in their RIGHT Mind would be in this market in the first place. Very soon a printing press will own everything.
Keep STACKING EVERYTHING but paper and electronic so called wealth.
Go over to the "Yeehaw" Finance pages where they run the Crammer and CNBS and Reuters sock puppet bullshit artcles. There's thousands of those Mensa's over there. One reader this morning said that at 25 PE these markets are undervalued and that if you don't get onboard now you will be missing the move of a lifetime. The sheep really do think like that. PT Barnum was right, he just underestimated their stupidity, so I consider it part of my due diligence to understand what those dimwits are thinking.
Inflation, its all they know to the point that economics cannot exist without it.
That's not economics. It's theft. We need to call things what they are. For example, The State is religion. It's Economists are hight priests. I am an asshole.
Feel free to try it amongst yourselves.
Speaking the truth doesn't make you an asshole. Well, not to those who can think. Oh wait! I am an asshole too, to the vast majority! Here i thought i was such a nice guy, or girl, or both, or neither... my sausage!!! I guess i am a guy, after all.
I am an asshole as well, apparently, that much is certain and remained constant.
Massive short positions? For how long?
That assumes there is a functioning market (laugh track deafening) and a payment system when you want "some of your money" out of "it"
Saturday , in Maryland. All the radio stations host investment advice shows. I believe the hosts pay for theh time. It's like a talk show infomercial .
And they host phone calls. " call, if you're lucky enough to have a pension". This is the buying opportunity of a lifetime. Let's assume a 7% return.
Now I ask, other than a contingent of 70 yo longshoremen, who the fuck gets a pension anymore? Well, there is ONLY one group. They are special. Privileged. And that's who calls. And while I don't forsake them, it's enough to make us plebes sick.
And the part that pisses you off. After years of destroying our industrial base, which has decimated the unions and middle class, our Government ends up being the only entity with growing unions and defined benefit pensions. And the fucked middle class is screwed to pay them.
25 years ago, instead of working my ass off to start a small bidness, get licences, learn skiIls, I would have been better off to get a county yob mowing the median strips. That's fucked up. And yes, I'm pissed.
It's amazing how generous people (government) can be when they give away someone else's money, and they are building their own bureaucratic empire.
The taxpayers let them take no questions asked. How smart is the taxpayer?
Take heart, Sir or Madame:
I think you're going to find those skills you've acquired will keep you eating, while those without them will be in trouble, pension or not.
Like everything else, a pension is an IOU, nothing more. All's good as long as the checks are mailed in the full amount...AND...the presumed dollars they're converted to still buy something.
Skills--with tools and experience--can continue to provide sustenance for a long time.
Finally, it is a big mistake to assume that government won't be forced to change considerably, including massive layoffs. During the first Great Depression, the government wasn't already deeply indebted, and therefore, it had options with respect to employing the jobless. That won't be true this time, and as the article points out, creating even more debt to do so is out of the question. I mean, this is a truly-fucked checkmate, and I believe the TPTB full well know it.
We're only waiting for the event at this point.
Oh, and one other thing. Forget the war play; ain't gonna happen either--at least not by government decree, nor government propaganda.
For decades, we've been lied to so many times about geopolitical issues and alluring quagmires (Korea, Vietnam, and forward to Iraq, and all the rest), that no one is going to jump at the call to come running. Americans are fed up with the bullshit, and realize the best way to avoid more of the same is not to play the game. Most folks are gaining the wisdom to know when we need to fight...and when we don't. So, that dog won't hunt this time either...
m
Once the empire cant pay all those promises to their loyal slaves and the slaves wake up to the lies they have been fed then the SHTF. Hopefully The revolution will start from within?
Oh, I think so.
First, as above, the "war" card is mostly a dead letter. Americans, I think, are finally taking our Revolutionary instructions: 'wait 'till you see the whites of their eyes' seriously. That means, actual invasion or factual evidence of a real assault from without--not merely accepting, on "honor", government claims about them from without or within.
Second, we can't afford it without severely increasing the debt burden. That simply can't happen anymore. The credit card will HAVE to be cut in half, or the bond racket will explode.
There are also human consequences too, as we see in the current invasion of Europe. Think that happen here? Think again. Think Mexican border for several thousand miles, mostly unsecured. All the world has to do is get here, and in they go.
Lastly, the economic hardship upon us is happening to a very, very weak people. We ain't the lean, hardworking poor agrarian peasants we were prior to the last Depression. Those folks wouldn't have liked us much, and wouldn't have wanted much to do with our lazy, free spending ways either.
They especially didn't like credit. Most people then hated to owe anyone for anything.
So, yes, when it gets going, a lot of us are going to start whining for our mommy, and that's government. Expect the same response Hoover gave--not much. He saw handouts as deleterious to industry and pride, and therefore, didn't provide it.
Today, we have little of either, and government doesn't have it to provide.
m
Hell hath no fury like a gov burecrat that has been told NO!!!
If it's broken, I can fix it. If it needs to be built, I can build it. Autos, electric, plumbing, Hvac, welding, bricklaying, etc.
And while I can find work, my skill set has been undermined by the illegals. And I'm getting older. Most of the value is in the knowing, not so much the doing, anymore. Try to get paid for that!
And people, right now, just throw things away, instead of fixing.
Meanwhile, I know idiots. Full blown fucking morons, who could not make change, making high five and six figures working for government. And I include peeps I know that work for Lockheed of doing work for the government, for example. And police. Firefighters. Nice fat pay and bennies. Valuable work, I agree, but damn.
I will probably die before the shitshow unwinds and my skills will be valued again.
"...This brings to mind a second, more ominous question which is: How far could that downward spiral go? If state intervention keeps making problems worse and people in turn keep demanding more, at what point will they realize their error and stop? Will they? As anarchists, we realize that each step away from individual liberty will make people in the society meaner in every sense of the word (materially, spiritually, physically etc). As people become more impoverished, and life becomes harsher and more brutal, learning and respect for truth and rational thought will decline proportionately. In such conditions, it is difficult to imagine a resurgence of belief in the importance of individual liberty. This is particularly true if you consider how difficult it is to get people to adopt our ideas even now, in our relatively wealthy society, one where people are awash in leisure and disposable income.
Considering these givens, what could possibly turn the tide? What could stop the cycle of decline? As frightening as it is to admit, we must come to the conclusion that nothing appears likely to do so. Certain exceptional individuals will, of course, recognize what is happening, but they will be unable to stop it. Our civilization therefore seems to me at least to be on the road to tyranny. This is not to say it will happen overnight. There is a great tradition of individual liberty in the west. But gradually, generation by generation, that history will be forgotten or ignored. Traditions will fade, and our great civilization will revert back to the historical mean, and our descendants will live lives similar to the lives most humans have lived throughout human history. One where the great majority struggle in subsistence, ignorance, and desperation and the very few live equally ignorant lives of crass, brutish luxury and exploitation..."
http://anarchiststandard.com/2015/09/an-anarchists-guide-to-the-future/
Once the Federal government (i.e., Congress) understood that there appeared to be no adverse consequences to piling up debt (and, I understand, at SOME point the interest cost will become unsustainable -- but that could be YEARS away), our representatives realized they had no vested interest in reducing the size of the government that fill the troughs they feed from. The Federal government may well be broke, but that has not stopped us from spending like there is no tomorrow, and all the predictions of collapse and doom-and-gloom have proven to be inaccurate. Government pensions will continue ad infinitem as long as someone is willing to buy our debt, and there appears to be no shortage of buyers.
Shortage of buyers? you gotta be kidding me. Could never happen hahahah lolol
When you are out and about during the day (right after reading that property tax and sales tax increases are badly needed after 8 years of just holding on) You see the city and county workers in brand new trucks working 8 to 5 with benefits and pensions doing very little.
The best is the little "fee cop" who rides around looking for someone who is putting in a new water heater or porch, so he can jump on the "home owner" and collect some asinine permit fee "or we will lien your house"
http://transparentcalifornia.com/pensions/all/
Maryland has the highest Fed Gummint pension payout zipcodes in the country. I am sure state and local pensions try hard to keep up. That "rain tax" O'Malley fellow knows what I am talking about.
In Portland....the KXL News station does the same thing. It is just an infomercial. I was listening to the guy talk about flipping houses. It was hilarious. Portland, Oregon housing market is so out of whack...prices are sky high..people are fighting over shit hole homes...and this guy says it is time to start flipping houses. Wow...good luck with that. He talks about how to pull all of you equity out of your home so you can start doing this. Here we go again...
I went to my credit union the other day to make a deposit, and all over the place were big, colorful banners designed to look like the covers of Home & Garden magazines.
One of them showed a lavish new kitchen with Sub-Zero and Wolf appliances and granite everything.
Another showed a fabulously landscaped backyard with a 'sparkling' pool and barbecue/patio area.
The title on these banners?:
"Make your own Home Improvements,"
"Loans up to 133% of Value."
[We are so doomed...]
redacted
We know for a fact that both government and media lies constantly. Therefore nothing said by government or printed in the media, even alternative media, that can be trusted to be the truth. It is ALL propaganda for the purpose of manipulating us (we are so important to them that they want to manipulate us). They cannot do anything without us.
So, they play and try to control all sides of every dialectic.
Unfortunately we then need to actually observe their actions and project their future actions from their past actions... and then act accordingly.
Right now, their past actions pretty much indicate that they lie and cannot be trusted... ever. And, they are constantly trying to get us to do things in their best interest that are not in our best interest.
Ha ha 2100 drop a zero lol
Well, why stop at ES 2100? Why not, say, ES 5108932? That's a number too, correct? Why stop at ES 2100? Just curious why you pulled that number out of your ass? Did Cramer tell you that was the right-sized number? Just wondering, that's all.
Gold up this week.
Gold down.
I voted down, though in all honesty I think it will be both up and down.
Exactly.
< Gold stable as money
< Gold unstable as money
Gold priced in terms of what?
In many currencies, Gold is at or near record highs...
http://www.kitco.com/gold_currency/index.html?currency=brl&timePeriod=10y&flag=gold&otherChart=no
"Gold priced in terms of what?"
You don't have to think of it in terms of ANYTHING except a vehicle for holding wealth and transporting that wealth through the cusps of insane transitional fiat "world reserve currency" cycles. An ounce of gold buys today approximately the same amount of comparable goods as it did in Roman times. That's pretty stable.
Demand
Intervention
A manipulated market will go up and down.
Who cares. Try paying for food at the grocery store with gold. Even if they would take it, what will they give you in change?
It might be useful after a collapse in society, but someone has to take your gold in exchange for something you need. They have all of the power in the gold value assigned for the thing you need.
I believe that the whole goldbug propaganda is a scam ... that makes sense now, but not under future likely circumstances.
If somebody wants to pay me in Gold/Silver or Beaver pelts...that is fine by me.
Gold is useful as a bridge to a new monetary system.
Gold and silver are money.
More stupid analogys from the clueless... Try paying for your food with bonds or stocks.
Just ignore him, he's a PaperBug.
"You can't eat Gold."
Oh yeah?
You can't eat Twitter stock or real estate either...
Hey Grandad - any number of gold buyers are about (not just pawn shops) and often within walking distance of a market.
Actually your vote is like voting for: "insurance": up or down. Do you think THAT would be a valid "vote"? Just curious.
I always wondering how much S&P stock the govt holds?
It is simply unreal to see pension funds so underfunded when the market is just off an all time high. I understand pensions are composed of various asset types; however, talk about a losing proposition. I think the govt is all in now. Proping up the stock market like China, and we call them rookies?
There will be a demand that no budget will be done unless gun control is in place. Watch.
The attempts to extend central banking beyond its well demarcated boundaries and limits(essentially 20th century technology) is what will lead to bloodshed.
Those running the show are the persistence of a 19th-20th century cartel mindset. They are proving themselves incapable of adapting and transforming into the expectations and demands of the 21st century. Their mindset-that of hierarchical control structures-has long since past them by. The debt those structures created is a testament to their obsolescence.
That kind of thinking -which liberated man from the agricultural world-is a liability in the way of men benefiting from the information age.
This is why I put my checking account into gold. I can even spend it like normal. Kinda.
upma.org
This IS the (new) normal!
Get used to it.
Can we?
What bothers me most is the threat of abolishing cash.
The more likely scenario is that cash will abolish itself. That is, of course until the same oligarchs who controlled the system before figure out how to impose a NEW system of slavery on the people because of their never ending generosity.
The problem is that money/cash was originally created to make it easier to trade goods and services, but now its used to make more money through the stock markets and interest (Usury)
Cash was originally created so that brokers could set themselves up to:
- steal your gold
- issue you little strips of confetti to transact with
- print more little strips of confetti than they actually had gold holdings
- squirrel away the actual gold (no one knows where)
- skip town when the ruse came into the light of the public
It's still that way today.
Because when it falls aprt they are the ones that dictate the new system,which is the same as the old system. Who caused the crash in 2008, who causes all the crashes since 1913? Same fuckers, well at least their spawn.
Because when it falls aprt they are the ones that dictate the new system,which is the same as the old system. Who caused the crash in 2008, who causes all the crashes since 1913? Same fuckers, well at least their spawn.
I don't think they'll be able to abolish cash, it goes too deep in people's psyche and that would really trigger a panic. Impossible in China, nearly impossible in Germany. And the NIRP is actually easy to circumvent. "Just" need to open a bank that just keeps deposit without lending. No need for central bank refund. Pretty sure this kind of shop would get market shares from the BofA or BNP of the world
If you abolish cash then the underground economy dies. Yard work, baby sitting and hot Puerto Rican maids are feeding a lot of low income families. You end that and what’s left of the system rolls over. Much like the last days of the Soviet Union, the only viable economy is off the books.
And drug dealing.
There are some powerful peeps making fortunes off that.
Of course, give it a few years, the Government will take that over. Can't let a profit center go untapped.
Just like gambling. Forever, they told us how BAD it was, and policed the shit out it. Then, the Lottery, for the children. Now, it's full blown Casinos everywhere, screaming for your bidness. For the children, though.
But, you can't smoke in a Casino. That's bad for you. Gamble the rent away, and get piss ass drunk. But don't light up.
What's next? Government Herion or Prostitutes? Want a Starbucks? No, I don't have time for a blowjob. Mike Judge has obviously transversed the space time continuum, came here from the future, and warned us. It is fucking freaky how fast and accurate we are becoming Idiocracy.
I would settle for one that just accepts deposits and lends. You know, like in the old days, A BANK.
with sound money of course instead of debt scrip for the company store
Or even better, slap down a silver dollar on the bar and tell them to bring the whole damn bottle.
You pretend there is not enough gold? Use Silver, You say not enough Silver for your bubbles. BS there is plenty or you use copper too all the way down to aluminum coin denominations for the peasants.
But a scream will be heard unto the heavens as a million Jewish men cry out in terror at the thought of actually having to do some work.
Actually you are quite right, slick. If every bank had to maintain just $1 of capital, all this financialization shit would cease over night.
Well I tell you who was slick and allowed the banks who are supposed to be limited to banking and deposits FDIC insured to become nothing more than Investment Gaming Houses with your money,. Ole Slick Willie. H. Clinton
I dont know what the tribe and money changers are scared of. They could return to their more traditional jobs of counting the money in the back room and putting every hundreth coin in their pocket and shaving slivers off the sides of the shiny yellow ones.
With some help from Reagan's "financial brain", Phil Gramm. Let us also not forget his wife Wendy, one time head of the CFTC, who helped turned our commodities into 3 card monte.
It was a bipartisan scam.
That sorta thing is now called a credit union.
You are a share holder.
http://www.fool.com/Money/Banking/Banking06.htm
And unlike the big boys, generally they are not out to conquer the world.
All you folks are ignoring the elephant in the room.
They abolished cash in 1913 and 1971.
People are fooled that the pretty printed paper they trade is money. It hasn't been money for a century.
As long as people feel that slip of paper is money it is. I'm not sure people are ready to accept that the numbers in their smart phone are money just yet. They need something tangible.
""Just" need to open a bank that just keeps deposit without lending."
UPMA isn't a bank and they don't make loans. They convert your physical gold/silver to and from fiat cash as needed for a small monthly fee.
If they tried it right now I think it could be what sparks a civil war, thats my opinion. The thought our system is so bad they have to ban cash says our leadership SUCKS! It represents the loss of freedom from government. We will not be having that in this country.
"By 2020, the US Government will be spending more annually on debt interest than the total combined military budgets of China, Britain, France, Russia, Japan, Germany, Saudi Arabia, India, Italy, South Korea, Brazil, Canada, Australia, Spain, Turkey, and Israel."
"Through government spending the indulgence of one is the burden of another; through government borrowing, the excess of one generation becomes the yoke of the next; through international bailouts, one nation's extravagance becomes another nation's debt"
"Everyone takes, nobody makes, work doesn't pay, indulgence doesn't cost, money is free, and money is worthless."
Mr. Pierre Poilievre MP of Canada
FORWARD SOVIET!
The average EBT user, illegal immigrant (but I repeat myself) and rich fat cat will disprove your theory.
Don't lose worrisome sleep over that scenario. We will just recoin outside of Federal Reserve Note.
It's clearly stated in the Constitution. Gun control is about protecting them. Once a few snipper rounds go through the windows of Federal Reserve, fear will be instilled. Threats will mount, recoin US currency. They no long have the counterfeit money printing cartel monopoly.
All of these mass murders stories are to execute a firewall of protection to institute cashless society. No guns, no resistance.
The thing to ponder is to try and imagine what sort of "Samson Option" the puppeteers (who have owned & developed this debt based counterfeit money printing machine lock, stock, & barrel), will decide to unleash in a last gasp effort to preserve their 250 year old franchise.
lacks substance
Needs more cow bell.
I gave you a "down arrow". Are you saying the article lacks "substance"? If so, have you actually been alive, for the last 8 years?
"[..] the data show plainly there are five times as many claims for US dollars as US dollars in existence"
And x200 times claims on 1oz gold ! Hopefully no one requests for their barbarous relic anytime ever...
What difference when the dollars in existence are basically all credit slips in the first place?
And 200x gold! Anyone notice JPM isn't accumulating gold but instead vast amounts of physical silver? Gold will be confiscated before long and silver will be to the moon and the big banks will rule, or I shall say, continue to rule.... the setup is in place, the cards are dealt and we are all impatiently waiting for everyone to show their hands
FOFOA wept
This is the mechanism used to remove all the worlds QE.
Now we will experience epic deflation.
It's more complicated than that. Yes, epic deflation for the stuff bought with borrowed counterfeit money that appeared out of nowhere, without any relationship to labor or conversion of goods using real capital to add value. When the failth in, and credit of, the evil empire USSA collapses, the real dollars that remain will be coming home to buy stuff in the only place where they still can. With too much money chasing too few real goods that people need to live, those things will hyperinflate. Hang on for a wild ride...
An, I mostly agree with you but I don't think we will see the hyperinflation.
The dollars were created out of thin air and back to the air they will go.
Inflation would save our asses, so we won't be seeing it.
The goal is middle class destruction.
This "system" is designed to make a few people at the top very rich, while the rest of the people at the bottom fight over the kitchen scraps. The only problem is that when it finally grinds to a halt (cant service the debt) its made much worse through austerity measures. But when things become so bad that people can no longer feed their families that's when the trouble starts (unrest/revolution).
The worlds resources need to shared and distributed in a more equal way otherwise we will always end up with the very same problems we have now. We need to build things to last (rather than having planned obsolescence) and people need to be progressively taxed based on luxury/wealth (waste of resources). Only then will we truely reduce pollution and have a safer more productive planet.
Wasn't there someone who once recommended eating the rich?
Yes, but, only if they are fat enough. They need to be fattened up first.
I thought there would be cake. Where is the cake!
The US is not going to ‘create’ $88 trillion. More debt cannot solve this.
Whatever made you believe that? We haven't done anything but that for the last 30 years now!
Printing has always been the solutions and will be untill the end. And devaluations of the currency has been the sollution for every country in any crisis. I don't even know a country that didn't turn to that when they had a problem.
Just look to europe as the last example!!!they has laws preventing moneyprinting as a sollution !!!
Now they're printing 86 billion a month untill it's "fixed"
And the door is open so they'll eventually increase that also.
And for the dollar? It's devalued over 99% in 100 years, that's not a sign that moneyprinting isn't a option anymore.
And all our politicians lack a backbone!!! If that's not a hint I don't know!!
Its called "debt slavery" the inevitable consequence of a human rights violation-that of using humans as collateral.
Its basically the reason the world by the end of the 19th century had outlawed slavery. Slaves can't consume.
Problem is the Western Anglo-American Bankers and the MIC have painted themselves into a similar corner Joe Stalin and his buddies found themselves at the end of WWII.
Stalin and his henchmen could see what was going on at Nuremberg-and they looked around the room at one another-and promptly dropped the iron curtain-until they themselves had all died of old age. They assumed-quite correctly-that an open door policy would lead them to the same courtrooms.
The current pack of crooks and theives know that in a just and open world-they too would be in a courtroom but for the electronic Iron Curtain they have assembled. The freedoms compromised by that electronic iron curtain assembly have choked off business worldwide and created monopolies behind legislative, judicial and electronic firewalls that are virtually impenetrable-except eventually by the impoverishment of those outside.
.
Cash is obsolete, it annoys me, so I use smartcards that are 'paywave, paypass, tap and go' - RFID chip cards. They rock. Can't wait for the implant version so I buy shit without a wallet or phone. Won't be any collapse while there is a cash-->electronic transition...
You'll be the first crying to us about how your bank account was frozen over a unpaid parking ticket.
Why don't we RFID chip you? This way, we can watch your everyday moves on a phone APP and rob you, then open new CC chip cards under the three credit score agencies.
It just happened under T-mobile. It wasn't t-mobile, the credit services were breached... who t-mobile pays to validate FICO scores.
Careful, they'll turn off your chip maaan
When people fear death, they chirp like a nightingale bird. Collectively, they rat each other out.
/winks
I've not followed A.E. Does anyone know what they recommend portfolio wize?
1. No debt, lots of debt?
2. Cash in the mattress?
3. Gold/Silver?
Obviously stocks are going down, House prices are going down. Just wondering how they think someone should be positioned in their mind?
60/20/20 (gold/canned sardines/Lindt 70% dark chocolate)
Excellent! I'm perfectly positioned!
Fuck! I knew I should have leaned on the Lindt.
10/10/10/10/10/10/10/10/10/10
Lead
Brass
forged steel
silver and gold
canned sardines
dark chocolate
rural property in a gardening climate zone
independent source of water and electricity
treat your family with love and respect
friends who got your back
Fixed it for ya.
Corrupt murderous government sons of bitches.
There is no such thing as "market losses."
Participants in markets gain or lose.
The presumption is, what, that $13 trillion mysteriously vanishes?
Think about where it came from... NOWHERE!! Digits miraculously appeared on an electronic ledger, either through fraudulent reserve lending, or Fed counterfeit market operations. Why is it so hard to believe that $13 Trillion couldn't go back where it came from??!
Because of the reason for the cause of it to be?
Ask Elizabeth Coleman
9 TRILLION Dollars Missing from Federal Reserve! - YouTube
So, Media-opoly does not yet control YouTube?
I would also remind you that the day before 9/11, Rummy was testifying about a missing 2.3T from the Pentagon.
No, it doesn't "mysteriously vanish", it gets concentrated into the hands of a smaller and smaller group of people. I seriously doubt that you are part of that group.
With much of it 0 s and 1 s now my old laptop is a potential fortune in hiding.
Why store it in the Bitcoin Cloud?
It gets bad when people believe it is getting bad and then they act as if it will be bad... and then it becomes a self-fulfilling cycle. You cannot create that with an scare tactic article or rwo.
Right now, people do not believe it will be bad. A drop in commodities positively affects people. It negatively affects companies that use commodities as collateral, but that is not "people". The stock market has not dropped nearly enough to concern people.
In the view of most of he people, nothing has changed and no one cares about 1%, 2%, 3% drops especially after so many years of gains in the stock market of 10% to 30%. Maybe if thee banks were selling with both fists and it was known, then people would react differently. However, the banks can never sell. There are no buyers big enough to buy the shares held by the banks.
... and honestly our business is good. The factory is running 10 hours a day, when normally we run 8.
Glad you're doing well. Let's hope your line of credit doesn't get shrunk. Cash flow will be tight and rely on Net commercial payment terms.
No problem there currently thanks. Yes, if the banks tighten credit on others, then it will slow payments and slow the economy... and then it would be clear that the banks are forcing a recession AS THEY HAVE DONE IN THE PAST.
But, it will not be the people who cause it, or some Chinese Bogeyman, or phantom controlled markets. It will be a clearly planned action of the banks. There are no black swans.
After seeing the start of the commodity downward force a year ago August, coming from those who control commodity market prices, not the market itself, we adjusted accordingly.
major credit card co's and robbing you blind: Am express card sent to me (not asked for, by the way ,by me)..
12.99% int rate, cash advance 24.99%,, one missed payment for any reason, get this: 29.99% for six months after payment....29.99%
and on my savings accounts I get 0.01%..kill the banks.
the american public is sleeping while the banks and cc co's rob us ...this form of legal crime fits in with the total lawlessness of the money centers - 29.99% on credit card debt..somebody just needs killin.
I don't have a credit card anywhere near 30%. If your credit sucks then they will totally rape you. The other option is not to use credit cards.
Grumps, just curious. Do you " sell " a product to the government? I'm working on a theory, so far spot on, that anyone doing well now, is because they sell to Uncle Sugar.
As the late George Carlan said.
'You ain't in the club"
Can't see the ban on cash working because people will resort to other forms of trading. You purchase an item the payment is only one half of the trade, the other half of the trade is what you get for the money. So trading chickens for pigs it is then and like to see a banker get a cut on that.
As for the size of the debt, if it was all cancelled out there would be a black debt hole in space where earth had been sucking in the rest of the universe. Don't think people realise the level of global paper debt out there wether it is in China, USA, Japan, Russia or anywhere else.
How fast can it crash? As fast as people can get rid of it and some clever people might realise it is a quantum crash where every piece of connected debt all goes up at the same time. Imagine gold ETFs at 250x or so and if any call is made on a level of the physical anybody holding ETF's gets nothing.
So I would love to see a big player like China buy a large number of gold ETF's then make the call watch the whole lot burn. That is a WMD! Anybody holding 1/250 th of all gold ETF's can make the call baby ... :-) So who is holding what?
Yes I see your point.
I can monetarise my walk in closet on the 35th floor in Manhattan through Airbnb with the caveat that they pick up from the deli two blocks away three times a week.
Can be settled in cash.
Read the fine print. A Gold ETF is the same as betting a position on a horse at the track. You buy the win, place or show position, not the horse because they don't have to deliver.
At least a casino has to be legit although those free drinks ain't really free as the Dutch Courage kicks in.
We are the greatest country on the earth. We have so much abundance of life and paper and scissors; so much! We do not have to work like other countries. I see more of the same in the years to come. Heck, our way of life is the best.
All of these articles of doom and gloom are followed by 2-3 weeks of stock market gains. let us see if I am correct. Mark this post and let's examine on 10/21/2015.
NOTICE: This post is not a recommendation to buy or sell stocks/commodities. It's the opinion of this poster only. Everyone is responsible for their own investing and should seek advice of trained professionals when making financial decisions.
You really need to check your Normalcy Bias and Recency Bias.
'C'mon' ain't nobody gonna be 'picking up the pieces' when this thing goes down. 'You'd better think twice' about how things really work.
I guess it's just a 'child's claim to fame'.
'We'll make believe that's all you know'
Sad to see a great band as an avatar of such a clueless poster.
LOL. Let these fools ban cash and watch their ponzi implode in a heartbeat.
Cash? What is this cash u speak of? I have a 1000 lbs of nickels and a 100 lbs of silver and gold but no FRN's!!
I guess I have already gone cashless, now let me go check the chickens, it is breakfast time!
After opening my eyes just a few short years back, and reading about everything I can that's happening, I'm starting to get my arms around it all. The history, the legislation, the policy choices, all that crap. It seems a lot of ZH readers agree that the US troubles started around early 1980's, when, after 200 years or so, the spending compared to GDP started to take off. Throwing all common sense out the door, the government then let the bankers "go to town" on the system by pulling Glass Steagall off the books and yanking the gold out from behind the currency. It seems that greed and human nature have always won out throughout history, and now we see the destruction of emplre taking place for the same reasons. My comment here is the model of our economy would not hold up in the long run anyway, as a technological economy consumes irreplaceable resources. The only lasting economic model must be built on totally renewable resources, i.e., one that nature can sustain. Many such models were and even still are in existence, based mostly on more primitive methods of existence: the hunter/gatherer model, and the agri-economy, similar to what is practiced by the forest tribes or here in the US, by the Amish. I'm sure most Americans enjoy their standard of living, and would not willingly jump into those systems. But the present system is not sustainable in the long run. Sadly, I also believe that if the US government were very prudent and not wasteful, this event we now face could have been postponed for even decades longer. However, the majority have unfortunately elected basic incompetents to make important decisions, and it will now come back to land on our heads. Ancient Roman empire = about 2000 years. US empire =about 250 years. So far, the ancient Romans win.
Outside of going off the gold standard under Nixon in 1971 - there is another thing that gets underplayed IMO.
And that is that the so-called investment houses went from private partnerships to public companies through IPOs. And oddly enough, Goldman Sachs in 1999 was the last if memory serves.
88 T ? BAHAHAHAHA... Unfunded liabilities alone are north of ++100 T, and then there is still the whole derivatives casino of the TBTFs which weighs in at ++ 1000 T. The resolution to the current "system"-imbalances are indeed going to be one for the history books - I just hope someone will still be around to read about it afterward.
Is this the same Meijer that called for lettign a horde of middle east and african scum into europa unchecked?
No, it's the Ilargi who told Europe that they caused the mess, so deal with the fruit of your of your efforts.
He does have a heart and compassion if that is what you meant.
Or did you mean " ya we fucked up your countries with bombs, so I Guess it sucks to be you"
(Some) reasons why this country is screwed :
- Incredibly, most Americans even today think that the Federal Reserve is a federal agency. This even after all the massive amount of attention paid to the FED concerning QE, ZIRP, and all the vestiges of the financial crisis, etc. People have just a passing knowledge of what these terms even mean and do not wish to educate themselves.
- The typical household carries ~ $15k in credit card debt. The average cc interest rate is 15% or more. It does not occur to the average cc debtor that the financial institution gets its funds for 0-3.25% (fed funds rate through current prime rate). It does not occur to Americans that banks, while paying almost 0% interest on deposits - the other main source of funds for credit cards, leverages this by approx 10X to issue debt for any number of things and rapes them on the difference. {{{ Those with an excellent credit rating actually believe they are getting a good deal at around 9.9 - 10% on credit cards }}}. And the true 1% and mega-corps actually get their money almost free.
- People focus on the monthly payments for new or used vehicles instead of the length, playing right into the hands of the banksters. (going back to CCs for a sec - they are also readily duped by 2% cash-back rewards, etc thinking they are actually profiting from their use in some way).
- Many people capable of exercising common sense at any level at all think that rising stock prices as a result of ZIRP and QE must be good for pension funds. Although this might make intuitive sense - THE OPPOSITE IS TRUE.
- Typical Americans are functional retards when it comes to any degree of understanding about the financial system or FED monetary Policy. The first time they hear a complicated sounding financial term they are completely intimidated and tune out. Actually, if an INQUISITIVE PERSON actually made an attempt to visit the FEDERAL RESERVE website to research any area of interest at all - they would be met by the most purposely fucked-up use of the english language imaginable by an outfit combining words together in passages that end up totally convoluted with no meaning even when the topic could be readily explained. AGAIN, THIS IS PURPOSEFUL to avoid successful inquiry by a normal person.
- In discussing the financial crisis, I have heard intelligent people say that "they paid it back" as far as the TBTFs and other recipients of emergency lending programs go. They have no clue whatsoever how easily such a thing could be accomplished under FED policies. Particularly through QE-like programs, along with ZIRP. {{ if they truly paid it back at all }}.
- But the very most alarming thing to me is = Everyone seems to have some basis of realization about the existence of income inequality and the .01-1%. BUT THEY HAVE NO WISH OR DESIRE TO EXPLORE OR LEARN THE REASONS THIS HAS COME ABOUT. To me, this is the most non-sensical thing about America today. Because, obviously - the one should naturally lead to the other. It has not. So we as a nation are FUCKED.
................................................................................................
I could go on and on but I've taken up enough thread space.
Not if but when,
Good Post. One very important matter related to your item #1 (Credit Cards and how that fraud works for the TBTJ WS Banksters). Our US Supreme Court passed legislation in a Credit Card case that said that the state of SD - where ALL TBTF WS BANKSTERS INCORPORATE THEIR CREDIT CARD DIVISIONS - was superior to the Federal Govt who was attempting to protect the "INDIVIDUAL" in the suit.
While this statement and ruling is literally factual under our Constitution, the REALITY is that if one takes that case to where it was, ie, the actual parties involved instead of the red herring the US SC made their ruling out to be, one will quickly realize that US SC used a parlor trick to rule against the people and Constitution of the US. The ruling should have been:
The Individual is Sovereign, therefore, the State of SD, who chooses to protect TBTJ WS Banksters over citizens of the US by protecting TBTJ's Usury Laws clear violations with State Guns and Laws adn LEO, should have prevailed. The CC Industry Usury Frauds, which are maintained as a "Federal" set of Laws, should have been destroyed by applying the Sovereign principles of the US CONstitution.
Fuck You South Dakota and US Supreme Court. Roll the Guillotines already!!!!!!
Any guess how much money has actually been printed versus what they tell us has been printed?
"...This brings to mind a second, more ominous question which is: How far could that downward spiral go? If state intervention keeps making problems worse and people in turn keep demanding more, at what point will they realize their error and stop? Will they? As anarchists, we realize that each step away from individual liberty will make people in the society meaner in every sense of the word (materially, spiritually, physically etc). As people become more impoverished, and life becomes harsher and more brutal, learning and respect for truth and rational thought will decline proportionately. In such conditions, it is difficult to imagine a resurgence of belief in the importance of individual liberty. This is particularly true if you consider how difficult it is to get people to adopt our ideas even now, in our relatively wealthy society, one where people are awash in leisure and disposable income.
Considering these givens, what could possibly turn the tide? What could stop the cycle of decline? As frightening as it is to admit, we must come to the conclusion that nothing appears likely to do so. Certain exceptional individuals will, of course, recognize what is happening, but they will be unable to stop it. Our civilization therefore seems to me at least to be on the road to tyranny. This is not to say it will happen overnight. There is a great tradition of individual liberty in the west. But gradually, generation by generation, that history will be forgotten or ignored. Traditions will fade, and our great civilization will revert back to the historical mean, and our descendants will live lives similar to the lives most humans have lived throughout human history. One where the great majority struggle in subsistence, ignorance, and desperation and the very few live equally ignorant lives of crass, brutish luxury and exploitation..."
http://anarchiststandard.com/2015/09/an-anarchists-guide-to-the-future/
Now you know what Obummer meant when he spoke of "fundamental transformation".
The article the guy links to that keeps referring to the dollar (Federal Reserve Note - FRN) as "money" couldn't be more off-base. The FRN is a currency - it is IS NOT MONEY, as it has been proven to not be a long term store of value, which is one of the fundamental requirements for something to serve as "money".
The FRN has LOST approximately 97% of its value since it was created in 1913 (or 1917 depending on who you ask). Conversely, real money, which really includes only silver and gold, will essentially buy the exact same amount of goods or services that they would have per unit at the time the FRN was created. What most people don't realize is that the inflation related to the use of the FRN over the past 100 years was just another tax on everyone but the really rich, albeit it was a hidden tax. People need to wake up to this issue before it's too late . . . .
you don't need dollars if you default
You are right. No rational person, now or in the future, would use gold at a grocery store. Nice paper dollars or electronic digits, created in their billions or trillions by a bankrupt government will suffice--as long as you have any.
No, gold will be far too valuable. Holders of gold will reserve it's use to high-value capital transactions; real estate, vehicles, equipment, investments, perhaps even establishing residence in foreign countries.
You will not be in a position to observe this. You will not know who has it or how it is used. I suspect, however, that you will regret not having any.
That's why you need silver in your pocket: For everyday transactions. Silver will be, in effect, fractional gold.
Buckle up your sphincters.
Hmmm if cash gets banned, how will the millions upon millions of illegal Latinos get paid? Can you imagine what happen what happens when they get hungry and despate? The US is addicted to cheep labour, politicians don't have to backbone to deport anyone! Oh there is one option, give the. Welfare tooooooo.
Sigh
I wish to be ignorant of it all. I have no means of figuring out how to survive an apocylpse or what I would do after a year withot income. My friends at work have no idea there is even a problem. I can't go around telling people to get out of the 2025 targeted fund in their 401k because we are about to go into deflation. What happens if the market goes up til 2018 or 2022' can you gaurantee it won't. Just watching people run around talking about houses and cars and trips to Florida and kids plans to go to college makes me sad.
BTW. Look for compression sacks.... They are essential to put your extra clothing such as socks underwear and t shirts etc. In while packing. I use them in cold weather for the down items in winter Backpacking the best weight to warmth is down. It packs incredibly small if you compress it. But do not leave it compressed in storage or it will lose some loft. Maintain down in dry conditions as much S possible. A compression sack of 7. Litres for a few items is good a down vest over a fleece hoody with a baselayer of wool and rain jacket will see you through down to 5-10 degrees. Don't forget baselayer pants. Wool or polyester. Like the military uses are fine. Terramar or wickers are good low price. Choices. The grid fleece items available are warm and efficient. Avoid cotton completely for cold weather it will kill you.
Cotton = death cloth
"Avoid cotton completely for cold weather it will kill you."
Maybe better to just avoid cold weather?