Guest Post: Another Consequence Of Economic Decline
Submitted by Simon Black of Sovereign Man
Another Consequence Of Economic Decline
Nearly 10-years ago to the day, the government of Argentina collapsed. Beset by weighty deficit spending and a completely unrealistic currency peg to the US dollar, Argentina became the poster child for the golden rule of economics: ‘that which is unsustainable will not be sustained.’ It’s reversion to the mean.
Within a matter of days, the country had burned through several presidents, the currency collapsed, inflation soared, unemployment shot up, crime rates spiked, and the government defaulted on its debt.
After limping along for most of the last decade with a socialist agenda, the government of Argentina is at it again. The economy is rapidly deteriorating, and street-inflation has surpassed 25%.
Naturally, the administration of President Cristina Fernandez insists that inflation is not a problem, despite the Argentine peso losing 25% of its value against the US dollar over the last three-years (and far more against gold).
Meanwhile, Fernandez has borrowed her plays from Atlas Shrugged. She’s imposed capital controls, raided pension funds, nationalized private property, and taken control of the media… all in a vain attempt to delay the endgame.
A few weeks ago, the government passed a package of new laws, essentially criminalizing public protest under the auspices of combating terrorism. The legislation, snuck in at a midnight session during the holiday period, provides severe punishment for various crimes under a very broad definition of terrorism.
Fernandez herself maintains that the law would -never- be invoked to restrict the legitimate rights of Argentines. This, from a woman who simultaneously passed legislation to seize control of the country’s newspaper industry.
In her latest move, Fernandez has stepped up her saber-rattling over the Falkland Islands, a nearby archipelago that has been a British territory since 1833 (it is now self-governing). You may remember that Argentina invaded the Falklands in 1982 and was subsequently defeated after a bloody conflict with Britain.
It’s a sore subject in Argentina; the government still claims sovereignty over the Falklands (known as Las Malvinas in Argentina), and Fernandez is waving the flag once again.
Last month Argentine naval forces were sent to frustrate commercial fishing around the disputed territory. And in the most recent development, Argentina, Brazil, and Uruguay announced that they were closing their seaports to any ship flying a Falklands flag (all 25 of them…)
Argentina has also mounted pressure on the British government to reopen negotiations over the Falklands’ sovereignty. Thus far, the Brits have refused.
Cristina Fernandez’s BFF Hugo Chavez recently added to tensions by saying, “The English are still threatening Argentina. Things have changed. We are no longer in 1982. If conflict breaks out, be certain Argentina will not be alone, as it was back then.”
At this point, it’s all just tough talk and petty annoyances. But here’s the thing– there are four billion barrels of oil estimated to be within the Falklands’ territorial waters.
Given the utter insanity with which Fernandez governs her country and the desperation in the Argentine economy, one cannot rule out the possibility of her trying to grab Las Malvinas by force. After all, military conflict is the ultimate social distraction.
I’ve often written that economics drives everything. A solid, vibrant, competitive economy lifts an entire nation into prosperity, while deteriorating fundamentals and a socialist agenda create inflation, unemployment, and social turmoil.
War is just another one of those consequences. And given the vast deterioration in the global economy coupled with deeply-seeded conflicts around the world, the Falklands is just one of many that we may have to look forward to in 2012.
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Gold Bitches!
Well, at least Argentina has hot chicks.
The United States federal government spends 25.3% of the GDP and collects 14.4% in taxes. We finance 10.9% of our economy through debt, at the federal level. This does not include state, local, and private debt. Sound like Argentina?
http://www.youtube.com/watch?v=Upez33EGiRA&sns=em
A good assesment of the US economy
If the asshole pos in the WH would get his dick out of Americas ass we might be able to work for a fucking living.
Unlike that third world place, our investments in MIC have paid off beyond calculation.
We went into debt, but leveraged it up enough to buy off most of the world.
at least for now.
For work, I have been back and forth to Argentina for over three years now. I am in Argentina for a year. The previous times I was here for 7 weeks a pop. I leave it to the readers of ZH to extrapolate what my experiences mean, but here they are:
1. The exchange rate has remained remarkably constant, hovering between 4 and 5. It has been 4.25 on two of the three occassions I have been here.
2. The cost of living here, in dollars (as I calculate my expenses when I get home) has gone up each time. Now, my apartment in a northern Argentine provincial captial costs about 60% as much in dollars as my aparment in the Philly metro area for the same number of bedrooms etc., but food is currently costing about 110% of what it did in the eastern US.
3. I have been here now for two months, and have not seen a significant change in the costs of food or essentials --specifically beef--the end all and be all of staples here.
Conclusion: Either this article is bunk/fairly ill-informed, or the US has a similar inflation rate right now. Or something else fishy. Probably the latter. Can someone analyze?
From a economic perspective the food going past 110% is a red flag. When inflation hits inelastic items, food (-.2%), energy (-0.06%), go up very rapidly. Housing (-0.6 to 1.2%) is inelastic but more elastic than food and energy and would climb in price at a slower pace, but not for long.
If I were you I would be watching the food items, get my money the hell out of there ASAP, and be ready for a rought ride. Get your lease extended ASAP if you plan on staying there and buy capital purchases NOW. Automobiles, anything durable.
The most important thing is to have your money out of there and all your capital purchases completed ASAP.
Argentina has a dark, dirty secret. They have repudiated Western bankers and their people have prospered. At all costs this truth must not filter through to the other debtor nations so consistent nonsense, "basket case" , "runaway inflation", government by edict" etc etc must be force fed by compliant media. Even the F'ing Economist magazine for Fs sake!
Exactly. The moneyed dicks will never forgive us argies for the default Greece should be doing right now.
Would this be the same Economist that, in 2011, described protectionism as "impoverishing developing nations"?
The Beano has more credibility.
have noted similar trends in other south american countries.
But they only give you a glance from under their sunglasses when you just about passed...
And if you do manage to get one, you will have to meet her friends and familiy and pretend
you`ve know each other for ages... comparable chicks of Italian descent are much more of a bargain in Aussi or the US..
They sure do, I lived there for close to 5 years. But I thank the poster in commenting about this, I totally forgot about Argentina. I remember Kirchner taking the Pensions but didn't consider that Argentina was going into a default like they had 10 years ago.
Orange juice bitchez - http://hedge.ly/xDZvFS
@ fightthepower,
Guns Bitches!!!
Interesting, that the Falklands are mentioned, as the Duke of Cambridge -- the future King, Prince William -- is being posted, long ith his RAF unit, to this disputed archipelago in February.
Sounds just like NDAA. Do they compare notes?
The Falklands diversion is also directly analogous to Iran/Pakistan. Create a false diversion and get everyone to get all wrapped up in the flag. Pathetic really, not that they do it but that the sheeple still fall for it every time. Argentina OR the US.
Fukushima was not an accident.
http://www.silvergoldsilver.com/index.php?option=com_content&task=view&id=346&Itemid=9
Man behind the story was arrested and held without charge.
http://truthfrequencynews.com/?p=15549
right on! check out how many reactors are built on fault lines! by the way, i used to love that show Columbo, with that dude, Peter Falkland!
I've always wanted a Guy Falklands Mask
http://en.wikipedia.org/wiki/File:Anonymous_at_Scientology_in_Los_Angele...
huh?? Japan is a faultline. Faults are everywhere.
Please don't tell me you believe they built it there knowing that a quake was inevitable within the next 50,000 years and would kill lots of people.
I'm willing to respect quite a few conspiracy theories, but that one is flat-out looney-toons. It wasn't an accident, alright -- but the cause was a design so crappy one of the engineers resigned, citing a failure mode identical to what happened. Yet the author of this theory dismisses out of hand that there were any engineering flaws as "The designers of the plant most certainly took all such cases into consideration." A designer did, recognized the design as flawed, and things progressed anyway.
Earthquake magnitues are easily verifiable by virtually any univerity seismology department on the planet, and the theory is arguing the the actual quake 10,000 weaker than stated.
Sorry, doesn't fly. Junk theory. There's a real conspiracy here, alright, but it's TEP and GE covering up a bad design and bad decisionmaking in the name of profit, not some whacked earthquake-didn't-happen, let's cause an intentional meltdown theory.
When you purposely build something that's accident-prone, and you put it in a place where accidents are likely to happen, and then an accident happens, and the thing breaks just as smart people expected it would (even though those smart people were "somehow ignored")... well, I guess it's either a really amazing coincidence, or its a conspiracy.
You wacky "Coincidence theorists" drive me nuts.
Little known fact: Chernobyl and Fukushima were actually built by closet anti-nuclear activists in a deliberate attempt to discredit nuclear power.
you seem unable to grasp "specific intent"
All conspiracy theories conveniently ignore the messiness factor of life: mistakes, bonehead stupid decisions, beyond-belief-dumb-as-turnips people, poor timing, poor choice of words, disorganization, fucked up things happening at the worst possible moment, Murphy's Law, bad weather, perfect storms, lousy mainteneance, blatant negligence, ignored warnings, running red lights, and the fact that some people go a little crazy some times
I have to ask: do any of you people have jobs where you have to interact with other people? Do you not DAILY see this phenomenon in play where groups of people, individually smart enough to do something not stupid, end up doing something VERY stupid while the whole entire group goes along with it?
should be bullish for conspiracy theory sales
Someone already beat you to it, and their making FRNs with it...
I wish I had a alt-energy powered commune in Chile so I didn't have to worry about this shit all the time.
Chile has some big faults...why not Honduras or Costa Rica?
HA!!! nice...............
OT but can someone please tell me, why is there VAT on Silver in Europe?
Any way to avoid it?
Thanks.
Move.
Move.
No way Im moving to Chile! I just invested my cash in the 4th Pillar!
if you,re not a US citizen buy ZSIL or JBSIUA at the SWX, it represents physical silver in the nominal amount of 1000 ounces. you only get charged VAT when you demand it physically. Hence you still have governmental risk in a feuderalistic democracy. else pay the 8% VAT and regard it as an insurance premium against the gov risk
Try goldmoney.com
I'll get junked for this but you could try an ETF, VAT free
ETFS Physical Silver Fund( PHSP-GB : LONDON STOCK EXCHANGE)Coins are for investing or saving and vat free. Bars are for industrial use, according to governments so with vat.
Avoid it? Coin bars from Andorra for example.
https://www.doijerkalff.nl/andorra-muntbaar-5000-gram-zilver.html
As well maybe buy directly from the Perth or Cnadian Mint? will that get around the Tax?
Nice little shop you posted as well. it is interesting (to me) to see what the rest of the World is looking at..
how about the 5 X 9's Maple? maybe a few for the novelty of it?
I tend to see the extra silver / cooper in my Liberty (U.S.) Crowns Coinage as free extra metal.
Once again! Thanks for sharing differnet and interesting!
nicht ganz. In Germany you pay a reduced 7% vat rate on silver coins and the full 19% rate on silver bars, while gold coins and bars are vat free. go figure.
One of the reasons I don't buy physical silver. Add the volatility, correlation with the stock market and bulk.
In the UK not only is gold VAT free, but "Sterling" coins (Sovereigns, Britannias) are also capital gains tax free.
buy it here at spot price and no vat www.bullionvault.com
The legislation, snuck in at a midnight session during the holiday period, provides severe punishment for various crimes under a very broad definition of terrorism.
Is he writing about the U.S.?
I wonder how many other countries did this recently?
My guess is that there are plenty of countries following our lead.
martial law?
They are setting us up for it.
I'm gonna do a little research to see if I can find out how many countries did this.
Any help would be appreciated.
Yes........appears we are well on our way.
Anyone ready for a shocker?
Go to Yahoo Finance under "World Indexes" and pull up a chart of the Merval since 2002.
One of the biggest index gains ever recorded for a Banana Republic.
Great! Now all we need is to invent a Time Machine to go back to 2002 and invest in that and we will all be millionaires!
Thanks for the tip!!!
robo is just so darned good at hindsight investment........
Wait til robo gets a look at the Harare index during the Zim dollar collapse. Apparently he can't get his head around the concept that stock prices inflate along with everything else.
+1 What would we do without the nuggets of wisdom comming from RearVewTrader? He truly is the Oracle of the Bygone.
Sorry, you lost me at "go to Yahoo Finance".
Well, that was the shocker!
"Praise the Lord and pass the bullets."
Inspirational poster coming real soon to an American street corner near you.
what's wrong with the current posters?
http://4.bp.blogspot.com/_NnjaXWUZo2s/TVFC5aKCzII/AAAAAAAABOM/i3Bd_oDBX3Q/s1600/070211top1.jpg
Something!
Ok, what's my prize?
She just had an operation..possible cancer....maybe they removed her brain...yes Socialists are winning...all over the world...are the schools teaching this....what a sucess.........
When do you think our Socialist will ask for his 1.2 trillion more in the debt limit....during the day...or late at night on some Holiday...and will the MSM report on it...after all its all Bush´s fault
"are the schools teaching this"
Yes.
The Secret History of Western Education & Scientific Destruction of Minds - https://www.youtube.com/watch?v=D3n_c8AfQm4
I actually meant are the schools teaching the failure of Socialism.......NOT....but yes you are right they are teaching that Socialism is great...just look at all the current examples.....oops..better not...its all Bush´s fault..
I'm assuming that stating that "socialism" is winning then that would mean what? "capitalism" is losing? If "capitalism" is losing then clearly it's not a better system, is it? For fuck's sake, BAD systems NEVER win in the end. Quit whining and get to work making YOUR pet/favorite system work!
BTW - I hold that it's fascism that's in command. At the very least, ALL systems have a penchant for totalitarianism, that's what happens when power consolidates (and, unless someone can show me how this is NOT the aim and underlying function of their pet/favorite system, well...).
If socialists were winning, the TBTF banks would be no more. What you're talking about is a plutocracy, or kleptocracy: socialism for the rich, capitalism for the poor. Obomba a socialist? Don't make my ass laugh...
BTW: The news today is that the cancer wasn't cancer at all and they removed her thyroids by accident? Something's really fishy there.
Thyroids, isn't that somewhere in front of yer Cerebellum?
Haha! Probably they did that to her long ago. In fact I believe most Argie presidents had a lobotomy before coming to power. But no, thyroids I meant these:
http://en.wikipedia.org/wiki/Thyroid_gland
http://www.youtube.com/watch?v=G9qZZVqSQdo&feature=g-all-c&context=G25748bdFAAAAAAAACAA
Uploaded by SenatorSanders on Dec 8, 2011
http://sanders.senate.gov/savingdemocracy/
Warning that "American democracy in endangered," Sen. Bernie Sanders on Thursday proposed a constitutional amendment to overturn a Supreme Court ruling that allowed unrestricted and secret campaign spending by corporations on U.S. elections. The first constitutional amendment ever proposed by Sanders during his two decades in Congress would reverse the narrow 5-to-4 ruling in Citizens United vs. the Federal Elections Commission.
Another Consequence Of The Economic Stimulas of the Lobby Whores in Washington DC!
JP Morgan has so Many Names to Lobby with http://bit.ly/fuRwmg They can give the legal limit in each name! JP Morgan DOES Lobby The MAX thru ALL their different Companies! Because all those different Corporations are People! And have 1st Amendment Rights!
here are some of the names.. not Hidden! from View!!
Affiliate of Heavy Hitter(7 results)
Maybe Bernie should learn a thing or two about the other amendments before suggesting more. Primarily the second amendment.
how about INSTEAD of bashin anyone or everyone for the things we dont like..
How about we support them.. when what they are pushing is GOOD for AMERICA!
I understand that since Obama is President.. that the Whole Country should suffer until some fucking repugnant gets elected..
it really is no wonder why 48+% of American's are recieving Government Assistance of some kind, American's.. Poor American's are busy trying to fuck each other over for any little thing they can.
Families were more dependent on government programs than ever last year.
Nearly half, 48.5%, of the population lived in a household that received some type of government benefit in the first quarter of 2010, according to Census data. Those numbers have risen since the middle of the recession when 44.4% lived households receiving benefits in the third quarter of 2008.
http://blogs.wsj.com/economics/2011/10/05/nearly-half-of-households-receive-some-government-benefit/
I am PRO Gun as anyone you have ever heard of.. let alone met.. but what the FUCK does that have to do with NOT! treating Corporations like people with 1st amendment rights?
You and everyone else better figure out a way to start fighting together.. becuase if not.. ALL of YOUR Rights will be sold off to the highest bidder.
It has everything to do with it. If Bernie can't respect the other amendments why would he respect his own? I can not and won't support a hypocrite that doesn't support the constitution as a whole.
Please explain how you see Bernie's amendment conflicting or underminding the constitution?
Because to a guy like Bernie the constitution gets in the way of things he would like to do , such as disarm the American populous etc. But it is a convienient tool for those things he would like to get done. If he wants to utilize the constitution he should accept those things he agrees with and those he doesn't . If he can blatantly disregard an amendment simply because it goes against his ideology then what is to hold him to defend any other amendment ?
it was paul and sanders that exposed the frb through the 2yr wait 'foia' --- if not for their heroic, and unyielding persistence,... we'd still be in the dark
The difference between Paul and Sanders is that Paul respects the constitution. It's not a convenient tool.
Bernie supports the second amendment, FWIW
Bullshit. His voting record speeds for itself. He scores an F according to his record. I prefere to judge people by their actions not their words.
"how about INSTEAD of bashin anyone or everyone for the things we dont like..
How about we just call them fucking repugnants"
Take your lithium and go back to bed.
"I see in the near future a crisis approaching that unnerves me and causes me to tremble for the safety of my country. . . . corporations have been enthroned and an era of corruption in high places will follow, and the money power of the country will endeavor to prolong its reign by working upon the prejudices of the people until all wealth is aggregated in a few hands and the Republic is destroyed."
-- U.S. President Abraham Lincoln, Nov. 21, 1864(letter to Col. William F. Elkins)
That made the hairs on my neck tingle
God Bless Abe and God Bless You Sir for posting Abe!
Read my post below. You'd damn Abe to hell if you knew the truth and had the power. Talk about historical rose colored glasses. If you read the history you'd wonder how he avoided assassination as long as he did.
Abe Lincoln was a tyrant of the worst kind and murderer. He only left conveniently pretty quotes behind to fool you. The myth of Lincoln is far greater than the man. He imprisoned northern civilians without trial, attacked the media and his political opponents, put into power a strong central government. He violently and eggregiously violated the constitution at every opportunity. "Honest" Abe supported the constitution by:
He didn't give a damn about civil rights, freedom or the people, least of all the constitution. Fuck Lincoln, let him rot.
http://www.amazon.com/Real-Lincoln-Abraham-Agenda-Unnecessary/dp/0761526...
Money is free speech, don't ya know... Maybe all those robe'd ones were singing "money talks and BS walks" in the back room?
Resources are getting scarce. Natives are getting restless. Something's in the air.
Fenandez was Bush's BFF as well, so the civil liberties eroding is not suprising.
This is what happens when a country is run by religious nuts. Which is about 99% of them.
Argentina is run by religious nuts? Put down the crack pipe, Mr. Head Cheese.