This page has been archived and commenting is disabled.

Guest Post: Exiting The Eye Of The Storm

Tyler Durden's picture





 

Submitted by Doug Casey of Casey Research

Exiting the Eye of the Storm

L: So, Doug: London has suffered more damage from recent rioting than from anything else since the Blitzkrieg; the stock market had its most volatile week in years; gold shot well north of $1,800; and the U.S. government almost crashed into its debt ceiling. Smells like blood in the streets. What does a street fighting man like you make of all this?

Doug: Well, it was about 40 years ago in 1971 [laughs] when I read Harry Browne’s first book, How to Profit from the Coming Devaluation. In that book, Harry said that if gold went as high as $200, it would be a sign runaway inflation was coming, and readers might need their survivalist retreats, etc. He was actually right about everything he said in the book, and for the right reasons, but things didn’t get as bad as quickly as Harry thought they would.

That just goes to show that if you predict any particular number or outcome, you should not say when it will happen, or if you predict a time for important events, you should not say specifically what will happen.

Anyway, I’m very uncomfortable predicting serious gloom and doom for two reasons: One, most individuals intuitively look out for themselves by producing more than they consume and saving the difference – so the amount of net wealth in the world grows. Two, technology continues to improve – Moore’s Law and all that.

L: I’ve heard you say that before, but you’re the guru, so you don’t get off so lightly. What do you feel comfortable telling us?

Doug: My sense is that we are definitely exiting the eye of the storm at this point, and we’re heading back into the raging winds of financial, political, and social turmoil. The riots you see now are just an indicator of what’s ahead – an appetizer… hardly the main course.

L: That’s a pretty bold statement, Doug. We’ve been talking about the so-called recovery really being nothing more than the eye of the financial storm that hit in 2008. But the U.S. and other governments around the world have been able to animate the corpse of the 20th-century economy and keep an appearance of life in its zombie motions longer than we thought possible. To say we’re exiting the eye of the storm implies that zombie is going to stop moving and the smell of decay will soon overpower everything else. Are you ready to make that call?

Doug: You’re asking me to do what I just said was unwise: to say both what and when. But yes, it does look grim to me. With the markets fluctuating so wildly, the Dow going up and down hundreds of points per day, that’s very likely to spook the government, investors, business managers, and consumers even more than they already are. Normally I don’t pay much attention to consumer confidence; it’s an emotional state, and emotions can change in a New-York second. But at this point the economy rests on nothing more substantial than confidence. It’s a confidence game. And confidence can blow away like a pile of feathers in a hurricane.

L: So what we’re looking at is not just a bump in the road. It’s going to change priorities and marching orders for market participants – and for those who interfere in the markets in various ways.

Doug: Yes. It’s the kind of thing that accelerates a negative spiral, in good part because everybody wants the government to “do something,” in the idiotic belief that it can improve things by doing more. Actually it can only help by doing less.

L: So… the economy slows more. Why can’t the government reanimate the corpse one more time, turning up the juice on the stimulus heart-shock paddles?

Doug: They’ve already created trillions more currency units. Most of these are currently sitting in banks rather than circulating. That’s partly because people are afraid to borrow and banks are afraid to lend, but also because the Fed is paying banks interest to keep what are considered to be excess reserves locked up. So these trillions of dollars that were created to bail the banks out are sitting there, but they’re not going to sit there forever. Once those dollars start circulating in the economy, prices will rise rapidly.

The other way for prices to really explode would be for the foreigners holding some six or seven trillion hot-potato dollars to start dumping them. With the U.S. government clearly unable to deal with its debt and the consequent credit rating downgrade – which was both inadequate and long overdue – those foreigners are getting pretty nervous holding dollars. Almost any sort of financial calamity could spook some central bank into exiting its dollar position wholesale. And once one of them starts, the race will be on, because no one is going to want to be left holding the bag.

These are two time bombs that are ticking away right now – the trillions of dollars outside the U.S. that could come pouring back in, and the trillions of dollars inside the U.S. that were created to paper over the leading edge of the storm. Either of those things could bring on the end of the dollar as we knew it, and both may well happen at once.

L: Okay … But the state has been very good at convincing people to pay no attention to the man behind the curtain. If the markets settle down, why can’t people go back to imagining that everything’s fine?

Doug: I’m not sure that many people really ever believed there was a recovery under way. Wall Street acted like there was – but only somewhat, since banks never started lending again. But unemployment has remained high; it’d actually be about twice the official 9% level, if it was calculated the same way it was 30 years ago. And outside of the price collapse of certain asset classes – like real estate – the cost of living has increased greatly for most people; the calculation of the government’s CPI is as corrupt as its unemployment numbers. I think it’s a mistake to talk about a double dip in the economy; we entered the Greater depression in 2007 and are still in it. A “jobless recovery” is not a recovery. The only thing that’s recovered is the stock market, to some degree. Aside from government hocus-pocus, the mirage of corporate earnings, and foolish investors wanting to believe it was safe to get back in the water, things have not gotten better. And they are about to get much worse.

L: That may be so, but the government, the press, and corporate America have all been talking about a recovery. With the Fed promising easy money, if the markets calm down, couldn’t the illusion of recovery be reestablished?

Doug: I don’t think so. The economy isn’t going to stay in the eye of the storm for much longer. The stab of panic we saw last week gave lie to the emperor’s new recovery clothes. It’s not just the losses on the stock market, but gold hitting significant new all-time highs in nominal terms, and Bernanke saying that the Fed would hold interest rates close to zero for another two years. That’s huge – and a huge mistake. It tells me that Bernanke has truly panicked. The impact this will have on the dollar cannot be overstated; it’s a guaranteed disaster. It assures that people will do all sorts of things they would not do without that artificially easy money.

L: Okay, but if they go into debt to buy houses and cars, they’ll create jobs and there will be more appearance of recovery, won’t there?

Doug: That’d just be digging the hole deeper at this point. What needs to be done is to let the market raise interest rates, to encourage savings – the accumulation of the capital needed to start moving forward on a solid basis. Instead of encouraging people to work, spend less than they make, and save the difference, these low interest rates encourage profligacy. They encourage people to liquidate savings and live above their means. As usual, the government isn’t just doing the wrong thing, it’s doing the exact opposite of the right thing.

L: Because...

Doug: Because of the false belief that printing money stimulates the economy. The artificially depressed interest rates of today will result in very high inflation and very high interest rates in the near future. A healthy economy gets naturally low interest rates as a result of a lot of savings, a lot of capital creation. A healthy economy has stable interest rates that relate to the amount of new wealth being created, typically just above the natural rate of inflation that results from real money – gold – being mined out of the ground. Artificially low interest rates stimulate malinvestment.

The Fed is also keeping rates low because of the government’s massive debt problem. The U.S. is already running trillion-dollar deficits – if interest rates go up, say, to 12% like back in the ‘70s, that would add another trillion to the deficit right there. Financing a $16 trillion debt at 12%, rather than 2%, equals another $1.6 trillion of spending – just for interest.

This really means they have no choice. The situation is completely out of control – the U.S. financial house of cards is irredeemable at this point, even with interest rates at close to zero. The whole financial structure is close to collapse, and that’s why I think we’re exiting the eye of the storm.

L: The Titanic has been struck, but Captain Obama just doesn’t yet realize how badly?

Doug: Exactly. And – adding insult to injury – not only are they doing the opposite of the right thing, they are actively punishing people who did the right things, who worked hard and saved. Pensioners living on fixed incomes are being forced to reach for higher and higher yields, which means they are being forced to put their nest eggs into riskier and riskier investments. This guarantees that the pensioners and the savers will be wiped out.

L: Unless they put their savings into gold.

Doug: Sure, but nobody but crazy goldbugs even thinks about that. And it gets worse: The current course guarantees the total destruction of the U.S. dollar. Again, I cannot emphasize enough how serious this is. People all around the world save in dollars. If the dollar is destroyed, it won’t just be Americans who’re hurt, it will be all the hard-working people around the world who’ve struggled to scrimp and save and put money away for future needs. All these people who were wise and frugal, they are going to be wiped out. They are going to be left with absolutely nothing. This is criminal – it’s the stuff revolutions are made of. And that’s exactly what I expect we’ll see plenty of, all around the globe.

L: Seems so clear – what could they possibly be thinking?

Doug: Perhaps Bernanke’s making the same mistake people with maxed-out credit cards make, when they think hyperinflation will wipe out their debts. They forget how nasty, brutish, and short life can be in a society in a hyperinflationary collapse. And think about it: What happens if you wipe out these debts? Who are the debtors? They are the most profligate people in society. So these artificially low interest rates reward the most irresponsible and punish the most responsible people in society.

L: Absolutely perverse.

Doug: [Chuckles] Took the words right out of my mouth.

L: Easy enough to do in this case.

Doug: Well, there’s your answer. What’s going on now really is creating the foundation for revolution, and not just in the U.S. The riots in London and Chile, and other outbreaks of chaos around the world aren’t anomalies – they’re a warmup. An overture before the symphony starts. Things will be especially bad in British and European cities, where there are millions of people who’ve never worked. Ever. They’ve just lived off the state.

L: Maybe we’ll hear the music on November fifth.

Doug: “Remember, remember, the fifth of November…” That would be interesting indeed. Readers should rewatch V for Vendetta to put them in a proper frame of mind on how serious things are. I mean… it is going to be a time when Street Fighting Man will be a most appropriate theme song. Turn up your speakers.

L: I agree with you, Doug, but I have to say it makes me a bit nervous to come out and say we’re exiting the eye of the storm. The powers that be have proven far more adept at keeping the balls they are juggling in the air than I ever thought they could be. Every time I think it can’t get worse without things coming apart, it does get worse, and somehow things don’t come apart, they keep going.

Doug: Of course. As I started out saying, Harry Browne’s prediction 40 years ago was essentially the same that I’m making today. Harry was a bit early – and I was too, in 1980. But this time really is different, with so many unprecedented actions and reactions between the market and the state. I truly see no way out for the state this time, and it’s going to be much, much worse than it would have been had it collapsed back then. I can’t say for sure exactly when things will fall apart, but I’m more convinced than ever that they will, and that we are about to plunge deeper into the Greater Depression.

L: What if you’re wrong?

Doug: I honestly hope I am, because if I’m right, the global economic devastation is going to have a very real and significant death toll. The price in human suffering these fools in government are setting us up for is truly monstrous. As a human being, of course I’d rather see good times.

L: But as a speculator…

Doug: Yes, as a speculator, I know the crisis will create phenomenal opportunities. If we lived in a stable society, with a stable monetary order and a non-predatory government, it’d be impossible to be a reliably successful speculator, because there’d be few or no politically induced distortions in the economy to take advantage of. So, always looking on the bright side, we can look forward to many new bubbles to result from the state’s massive interventions today and in the future.

L: Such as?

Doug: There will be a huge bubble in gold ignited, and maybe soon. That seems pretty much baked in the cake at this point.

L: That’s interesting. A lot of people say gold is already in a bubble – that the recent surge up to $1,800 per ounce is a sure sign of that. But you’re saying it hasn’t even started yet?

Doug: Well, I hate encouraging people to buy gold at $1800 an ounce, because that level is already more than 700% above the bottom in 2001, and I’m a bottom fisher. I like bargains, and I can’t call gold a bargain today. But it’s plain as day that gold is going to go higher. There’s simply no other place for people to try to safeguard their wealth as the dollar, euro, and other currencies plummet toward their intrinsic values. What else could people buy as they get more and more afraid of paper currencies losing acceptance? What are corporations going to do with the billions of dollars in their treasuries when their management gets frightened? Where else can they go when they need to get rid of dollars, euro, yen, and yuan? Central banks, too – what will they do when they need to dump dollars in favor of something that will hold value?

This is why I see a bubble in gold still ahead. It has nothing to do with the supply and demand for gold in the jewelry trade, or whatever – it’s going to be a result of there being no viable alternatives when the paper-money con game is over. Gold is the ultimate cash, and that’s where people will go when there’s a global, total, panic to cash.

L: Agreed. Other investment implications?

Doug: Gold mining stocks. Most good ones aren’t bargains, even though they’ve been lagging gold in recent trading, maybe because of the fear in the marketplace. But they’re going higher.

L: Of the two major forces that drive markets, greed and fear, which do you think will predominate going forward? Because there are different buying patterns, depending on whether it’s greed or fear in the driver’s seat…

Doug: You’re quite right. I think it will be a market driven primarily by fear for some time, and that will favor profitable producers, emerging, high-margin production stories, and maybe the best of the best explorers advancing projects with obvious merit towards production. Nobody buys the risky junior exploration plays when fear is driving the market.

L: Except a bottom fisher.

Doug: Except a bottom fisher, yes. There will be some fantastic opportunities in earlier-stage exploration companies that will get smashed because of fear. But speculators looking for those have to be patient. Many junior explorers will dry up and blow away during the fear-induced drought. Eventually, the best will come roaring back when the bubble inflates and the real mania phase of this bull market kicks in. Then, everything with “gold” in its name will trade at ridiculous premiums, even the crappiest juniors whose only gold is in their name.

L: How long before greed kicks back in?

Doug: There you go asking for a time as well as a prediction again. I don’t know, but it could be a while: A lot of greed has been washed out of the system with the big panic of 2008, the real estate collapse, and the stock market really going nowhere for the last ten years. Plus, when the bond market collapses, as I think it will, that will be the final blow. That’s really The Big One on the horizon these days – the bond market is three times the size of the stock market, so a major reversal there will cause enormous damage.

L: So, stay away from the junior explorers?

Doug: Just the crappy ones – and as you well know, 95% of explorers have nothing and never will have anything. But there are some which actually have gold or silver in the ground – or clear drill indications that they are close to being able to report having such assets – the kind you specialize in finding for the International Speculator. Those stocks are going to benefit from the flood of money hitting the precious metals sector. Remember, the whole gold market is trivial in size. It’s only a tiny fraction of the oil patch, and not even a rounding error compared to the global market. When the average investor wakes up to the need to own gold for safety and the potential profit from owning gold stocks for leverage to gold, it’s going to be like trying to fit the contents of the Hoover Dam through a garden hose. Prices will go ballistic, and there will be plenty of money hitting even the smaller juniors that have good stories.

L: Good reminder about safety.

Doug: And that’s another factor that will be driving the price of gold: It won’t just be speculation, it will be prudence – the flip side of fear. Prudence will drive people into buying more physical gold. Greed will drive people into gold stocks. I own a lot of physical gold already, but I’m still buying, even at these levels. And I own a lot of gold stocks, but I’m still accumulating those too, when we dig up good opportunities.

I look forward to seeing the pictures I know you’ll take on your next rock-kicking expedition, trying to dig up one of those good opportunities. ‘Til next time.

L: All right then – ‘til next time.

[The dollar crisis Doug alludes to isn’t some far-fetched, distant possibility: It’s very real, and it’s in progress now. Join Casey Research in a free online event – September 14 at 2 p.m. Eastern time – to learn more about the American debt crisis and how to protect yourself from the coming storm.]

 


- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Tue, 08/23/2011 - 17:09 | Link to Comment reader2010
reader2010's picture

In a world of illusions, you want to hold the real thing. 

Tue, 08/23/2011 - 17:18 | Link to Comment AldousHuxley
AldousHuxley's picture

When there is no real thing anymore as a choice, you just have a choice between illusions.

Just take human relationships for example: internet just replaced TV as sheeple's illusion dispenser: "Friends" TV Show --> Facebook "friends"

 

 

Tue, 08/23/2011 - 17:23 | Link to Comment CosmicBuddha
CosmicBuddha's picture

Yes, but the internet also gave us ZH; at least now we can craft our own illusion!

Tue, 08/23/2011 - 17:32 | Link to Comment AldousHuxley
AldousHuxley's picture

ZH is giving us nothing new just a different format.

 

In the olden days, without ZH, people will gather in the city squares and talk in real person, then protest in the streets and hang a few necks.

 

To the elites, ZH lets the steam out without damaging their property. All talk, no action.

Tue, 08/23/2011 - 17:49 | Link to Comment theMAXILOPEZpsycho
theMAXILOPEZpsycho's picture

yes this explains tylers showing at the bilderberg group...

in the old days doom and gloomer freaks had no where to find instant day to day information and share it with like minded individuals

so lighten up!

and I'd rather save my own ass than have a revolution

Tue, 08/23/2011 - 18:02 | Link to Comment AldousHuxley
AldousHuxley's picture

The fact that you need information to discover the truth means your ass is all virtual and worthless and not part of the special elite.

 

 

 

 

Tue, 08/23/2011 - 18:04 | Link to Comment theMAXILOPEZpsycho
theMAXILOPEZpsycho's picture

laughable!

ah yes O you who have no need for information and recieve everything directly via your all seeing eye!

Tue, 08/23/2011 - 18:43 | Link to Comment AldousHuxley
AldousHuxley's picture

bloomberg can get you the details, but anecdots can tell you generally how bad it is out there sometimes faster and more truthfully than a trend analysis by a government/financial entity.

 

  • Inflation: your gocery shopping costs and decreasing size/weight of contents; gas station
  • Housing: sell signs everywhere in front of houses
  • Federal Government: last presidential candidates were  either black, women,  or now-or-never old
  • State Government: state parks closed, DMV open fewer days
  • Local Government: cancelled fireworks on Fourth of July
  • Small Business: Office Depot has one guy working in the whole warehouse every visit
  • Unemployment: Hotter women are serving food and beer
  • Construction: no more illegal Mexicans at home depot parking lot.
  • Auto: car part store parking lots are full (people aren't buying new cars)
  • Education: more and more calls from your alma mater asking for money
  • Entertainment: NFL players are on strike. There is nothing good on TV anymore. Recycled movie ideas.
  • Retail: tons of luxury vehicles at walmart/budget retailers
  • Youth: kids at home after college or got jobs overseas or working at same place their parents work

 

 

 

Tue, 08/23/2011 - 19:10 | Link to Comment smore
smore's picture

Please leave your droppings at http://www.socialistworker.co.uk, they will be appreciated there!

Tue, 08/23/2011 - 19:30 | Link to Comment Rockfish
Rockfish's picture

How can you spot a moron ass? By what they say, "

  • Federal Government: last presidential candidates were  either black, women,  or now-or-never old "
  • Tard.

    Tue, 08/23/2011 - 23:19 | Link to Comment AldousHuxley
    AldousHuxley's picture

    You didn't know? You tought American elites would just give it up so easily?.....they let a black guy take the fall (you know one of those once in a 100 year depressions), then blame him for all the society's ills and when economy recovers, become president and take credit.

     

    Forgot to add:

     

    Banking: Jews (Rubinites) give up control of banks and give it to some Indian (actually bribed him by overpaying his loss running hedge fund to the tune of $300M)

    Tue, 08/23/2011 - 19:37 | Link to Comment NumNutt
    NumNutt's picture

    You are 100% correct, the items you mention are the same things I take notice of when I am out and about. Today I noticed a retired couple driving a brandnew caddie shopping at the local dollar general store. I have been talking to  people that own houses, I am surprised to find out the majority are in the process of walking away from them. Not to mention at my place of employment we are slowly loosing people and they are not back filling the postions, we are running very short handed with no end in site. The only people I know that are not seeing the sad state of affairs are either employed by the government or are union workers. Everyone in the private sector are bent over holding onto their ankles at the present time.

    Tue, 08/23/2011 - 22:28 | Link to Comment Joseph Mother
    Joseph Mother's picture

    Aldous knocked it  out of the park. 

    Take a step back from 'reality' and look around you.  That's pretty much what you're going to see, at least in the US today.

    Tue, 08/23/2011 - 23:53 | Link to Comment AldousHuxley
    AldousHuxley's picture

    Here is a Euro zone version:

    • Inflation: Cold bottle of cola is 4 Euros ($6); gas is near $10/gallon;
    • Housing: don't know about personal homes, but hotels were all overrated. 5 star US hotel chain for $600Euros/night  ($1000pn) when even in Manhattan it would be max $500/nigiht
    • Federal Government: They are socialists but still charge capitalist prices for education in UK now.
    • State Government: Airport taxes are $100+pp
    • Local Government: tolls > than cost of rental car; public transit strikes
    • Small Business: Shop keepers and restaurant wait staff are in their late 50s & 60s doing the job young mexicans in US do. (economy didn't expand enough for owners to delegate work and hire)
    • Unemployment: In Germany, they already do what Obama is looking to do. Government subsidized "internship" while getting paid with unemployment benefits BUT you don't count in unemployment statistics to make politicians look good. Switzerland started to restrict German migration.
    • Construction: Havent' built much. Still living in buildings built 400 years ago. German architects now work in Poland.
    • Auto: Small, loud(diesel), and manual (for that extra 2 MPG efficiency)
    • Education: In Italy, Engineering graduate school students in school were in their late 20s (28, 29) for just masters (BS MS is combined there)
    • Entertainment: BBC showing middle east uprisings and saying Prince William cancelled his honeymoon to go hide out in some remote British Falkland Islands so no crazy arab will kill him. Or recycled American shows in British accents.
    • Retail: people in Paris luxury shopping were mostly Arabs or Chinese or Russian. VAT (sales tax) is 20%.
    • Youth: There are more white kids than blacks in recent riots.  Irish are getting the heck out, British are getting the heck out to Australia or America.
    Wed, 08/24/2011 - 04:02 | Link to Comment theMAXILOPEZpsycho
    theMAXILOPEZpsycho's picture

    OK, now tell me how that doesn't qualify as information...

    Wed, 08/24/2011 - 05:22 | Link to Comment OldPhart
    OldPhart's picture

    Link to 'anecdots' mentioned, my Google seems to gargle it.

    Wed, 08/24/2011 - 01:24 | Link to Comment GFKjunior
    GFKjunior's picture

    I'll be sure to revise my fund strategy from looking at technicals to obveserving the "hotter women serving food and beer" or the ever faithful trend indicator of "nothing good on tv anymore"

    Tue, 08/23/2011 - 19:06 | Link to Comment smore
    smore's picture

    This "you are not special" hogwash is only a comprehensible line of argument to you, Aldous.  It's glaringly obvious that you haven't felt the need to inform yourself on much.  You are a twit.

    Tue, 08/23/2011 - 18:02 | Link to Comment DaBernank
    DaBernank's picture

    How do you know I didn't kill a banker today?

    Wed, 08/24/2011 - 05:24 | Link to Comment OldPhart
    OldPhart's picture

    You'd be bragging.  And the rest of us would be cheering.

    Tue, 08/23/2011 - 18:03 | Link to Comment iDealMeat
    iDealMeat's picture

    Going to have to disagree with that... 7 years ago I bought a gold coin because my dad was into them and I thought it was pretty cool.

    Now, primarily because of ZH, I regularly follow PMs and BTFD whenever I can..  ZH and PMs have also fundamentally changed the way I look at all other investments..

    I've also cut my consumption in half and learned a some things about survival.. 

     

    no action ie. (no participation) in TFTB will devalue their properties..

    Tue, 08/23/2011 - 18:19 | Link to Comment New_Meat
    New_Meat's picture

    Hux, in my best Parisian accent, I say: "Au Contraire, Monsieur."

    "ZH is giving us nothing new just a different format."

    The difference is that there are folk (n'est ce pas?) who are from all backgrounds, all regions, all persuasions (but all engaged here) who would never have been able to get to the "city square".

    Vigilante justice?  Not here.  Not by the Tea Partiers.

    Why do you advocate violence?

    But, Monsieur, perhaps this is your album of desire:

    http://www.amazon.com/Agent-Provacateur-Foreigner/dp/B000002J5Z/ref=sr_1...

    might help u through the night.

    - Ned

    {If I were quoting ma grandmere, I would have said: "Au contraire, Meathead."}

    Tue, 08/23/2011 - 19:01 | Link to Comment AldousHuxley
    AldousHuxley's picture

    Why do you advocate violence?

     

    Simple. Wall st. owns US government. Government exists to maintain the status quo.  

     

    If you look at history, status quo continues until forced otherwise. Do you see north koreans protesting Kim Jong Il's dictatorship? Things can get very bad my friend.

     

    Your only other solution is to leave the system, but unlike political tyrants, banksters are already global so no, you can't leave the gang.

     


    Tue, 08/23/2011 - 20:05 | Link to Comment New_Meat
    New_Meat's picture

    Au contraire-Meathead - Ned

    Tue, 08/23/2011 - 17:33 | Link to Comment reader2010
    reader2010's picture

    Marc Faber famously puts it this way: to hold paper is to trust central bankers; owning (physical) gold is to be your own central bank.

    Tue, 08/23/2011 - 18:35 | Link to Comment unununium
    unununium's picture

    Get some bitcoin and you can also be your own Wells Fargo, and Western Union.

    Tue, 08/23/2011 - 19:10 | Link to Comment AldousHuxley
    AldousHuxley's picture

    Better put it somewhere safe. Bank safety deposits are no good..." During the 1930s over 3,000 banks failed and the contents of their safe deposit boxes were remanded to the custody of the Treasury. If no one claimed the box it remained in the possession of the Treasury."

     

    Interestingly, "As of October, 1981, there were 1605 cardboard cartons in the basement of the Treasury each containing the contents of an unclaimed safe deposit box[ of gold]"

    Tue, 08/23/2011 - 18:15 | Link to Comment PRO.223
    PRO.223's picture

    In a world of illusions, you want to hold the real thing.

     

    reader2010

    That's really funny - considering your avatar.

    Tue, 08/23/2011 - 21:14 | Link to Comment reader2010
    reader2010's picture

    My avatar is a condensed version of John Currin's painting titled 


    The Wizard 1994

    http://farm7.static.flickr.com/6070/6053603790_df1925f02f_z.jpg

    Tue, 08/23/2011 - 17:19 | Link to Comment CosmicBuddha
    CosmicBuddha's picture

    I am long on wheelbarrows and gold!

    Tue, 08/23/2011 - 17:41 | Link to Comment toady
    toady's picture

    Coke, its the real thing!

    Tue, 08/23/2011 - 17:45 | Link to Comment Lazlo Toth
    Lazlo Toth's picture

    Coke?

    Tue, 08/23/2011 - 18:15 | Link to Comment PRO.223
    PRO.223's picture

    .

    Tue, 08/23/2011 - 17:16 | Link to Comment bankrupt JPM bu...
    bankrupt JPM buy silver's picture

    CHECK OUT THE NEW ETF by the morgue.

     

    Ticker: ERQK

     

    All you have to do when there is an earthquake in Manhattan is hit it long, and its correlated to all the bank stocks that will rally, and you can hedge the downside in PM's as it buy PUTS on auto for you.  In fact, if you put your dick in the C drive of your computer, and continuously click enter on your keyboard it gives free happy endings all day long.

     

     

    Tue, 08/23/2011 - 17:13 | Link to Comment Praetorian Guard
    Praetorian Guard's picture

    There will be NO exit. Think about this for a second - As a society we have hit our apex, what more is there to derive? Cheap electronics or gadgets that make life easier? Society, in general, based on the advancements of man have created billions of parasites - this especially true in Western countries. The only way to have REAL growth is to A) cull the population WAY down, or B) society collapses and a rebuilding of both infrastructure and technology takes place. Look at past examples of massive death attributed to man made or natural causes. These events left room for growth. Even when Rome fell, and lost its luster, it took centuries for man to revisit the technology of old - thus growth was inevitable. Today, unless we can colonize some planet and mass ship people out into space, nothing really is left when you juxtapose population with resources. The shit is coming, bet your last dollar on it, and TPTB realize that to have a "bright" future many within the population fold will have to disappear. Scary times. Got Guns, Grub and Gold???

    https://www.gunsgrubandgold.com/forum

    Tue, 08/23/2011 - 17:42 | Link to Comment Kat
    Kat's picture

    Every generation thinks its hit its apex.  what more can we want than what we have now.  Yet, we keep reaching for and acheiving more.  This was the blindness of Karl Marx.  So, I can't agree with you on that.

    Resources too are not a problem.  The only natural resource is the human being.  Oil is useful only because human beings have made it useful.  If human beings discover some new fuel or ways to not use fuel at all, oil will just be sludge ensconced in underground rocks.

    As long as government does not force the most productive to subsidize people who are too lazy to lift a finger, as long as it is necessary to still work to live, we will innovate and life will improve.  Necessity is the mother of invention.  But, that requires a collapse of the welfare state - or a move to Asia.

    Travel to Singapore and see the enthusiasm and activity, the people starting businesses, creating things.  It's exhilirating. 

    Europe and now America have re-enserfed themselves.  We have all become serfs of the state.  Cut down the state and the welfare queens and watch prosperity return.

    Tue, 08/23/2011 - 18:01 | Link to Comment Crack-up Boom
    Crack-up Boom's picture

    +1

    Tue, 08/23/2011 - 18:36 | Link to Comment Praetorian Guard
    Praetorian Guard's picture

    Resources are a problem. The population could be considered unlimited (though in reality it is not), yet resources are not. Look at the turn of the century oil/population charts and see how they compliment each other. I agree about the welfare portion. However, if every Asian and Chinese were to live as a westerner would require several "Earths". There simply is NOT enough resources to go around. As a species we have hit the limit. We have been here before, but time takes its toll, and our "time" is no different.

    Tue, 08/23/2011 - 19:01 | Link to Comment rwe2late
    rwe2late's picture

    Your self-congratulatory philosophy is worse even than coarse Puritanism.

    You wrote "The only natural resource is the human being." That is patent nonsense.

    Your worship of work and advocacy of it as an ultimate moral yardstick is also nonsense. Leisure should not be held in such contempt. The goal of work should not be more work.

    Your whole notion about government is upside-down. Government does not hand out its largesse based on who is the laziest. It is given other criteria by its TBTF and MIC 'recipients'.

    Most government waste is also military related. 60% of federal civil servants work for the military, Homeland Defense, or the CIA).

    Do consider, much non-military government so-called 'extra' overhead has to do with maintaining records and reporting for public accountability ... which is a VITAL thing for democracy to work. The useful public sector also strives to provide service to everyone, without exclusion. Private businesses can and do typically conduct their business in secrecy, and aim to exclude services (education, food, water, medical care, etc.) whenever it is 'unprofitable' to provide.

    Actually, of course, what is implicitly meant by private sector ‘productivity or wealth creation’ is profit-making.

    Consider the idea of ‘profit’.

    Profit is a man-made concept. It is a limited concept. Profit does not and cannot measure the worth of every and all things, nor can it be the ultimate guide to human conduct. The concept nonetheless underpins the whole notion that the pursuit of micro self interests will result in the best of all possible worlds. And it is that mistaken notion which is often used to justify the worst of all outcomes, and pronounce that the solution to our miseries is to increase business profits.

    Never mind the profits made by ruining forests, rivers, and oceans. Never mind the profits from destroying the fisheries and polluting the air. Never mind financial parasitism. Never mind sweatshops, child labor, and poisoned foods. Micro profit, it seems, does not measure the environmental losses to society, nor the debilitation and destruction of human beings. But yet, it is to be the ultimate arbiter of human conduct. Or so we are told.

    A system based on maximizing work, maximizing production, maximizing consumption becomes outdated in a finite world. It values neither leisure nor the quality of life, human or other. The corporation is the apex profit-driven organization of a misnamed and impossible “free market”. It is elitist, with a narrow single-minded goal, and disdainful of all that stands in its way.

    Government, like corporations, has evolved around the pursuit of profit. Government has become to be like corporations, autocratic, secretive, and obsessively entangled in the furthering of corporate profit-making, to the detriment of all else.

    Wed, 08/24/2011 - 05:30 | Link to Comment OldPhart
    OldPhart's picture

    Which Post Office do you work at, specifically?

    Wed, 08/24/2011 - 06:50 | Link to Comment Seer
    Seer's picture

    Way to engage in the debate- NOT!

    Wed, 08/24/2011 - 03:18 | Link to Comment Seer
    Seer's picture

    Fucking FAIL!

    Finite planet means finite resources!  Further, it's about rates of consumption.  Yes, stuff is still here (the future is in mining garbage dumps),  but it'll require a LOT more energy to rearrange the atoms back into forms that we need to operate our societal constructs.  The sun outputs only so much energy on a per-day basis, there are limits! (the argument that we can harness more than nature has managed to do over the course of evolution's billions of years history is pure crap- what, that would place us on a plateau with "god?")

    Your position is indistinguishable from that of those following the head-in-the-clouds hopium delusion.

    Tue, 08/23/2011 - 17:52 | Link to Comment AldousHuxley
    AldousHuxley's picture

    Have you read my book Brave New World?

    • Churches turned into mass orgies (birth control + bars & clubs + casual multiple partners)
    • Government passing out drugs to keep poor happy (California is close with marijuana legalization, alcohol is already legal)
    • Workers conditioned to accept their role in society (celebration of ghetto culture)
    • Destruction of families (extended family --> core family --> every man for himself)
    • Government raising human resources (test tube babies raised not by mothers but by social workers)

     

    It only ends when one of the Alphas uncovers the truth about his aritificial life and ends solitude with a suicide.

     

    " people believe what they have been conditioned to believe"

     

    And this masterpiece was written back in 1931.

    Tue, 08/23/2011 - 18:00 | Link to Comment Kat
    Kat's picture

    Do you realize that Brave New World is a work of fiction?

     

    I am an immigrant from the Soviet Union.   I've seen what happens when society is edged close to the edge of the cliff and it's ugly.  But, for that, you need government.

    It is government that gets in the way of human innovation, peace and prosperity because government is a massive parasite. 

    Tue, 08/23/2011 - 18:16 | Link to Comment GoingLoonie
    GoingLoonie's picture

    Kat-

    Now that is reality.  The truth is that is what is happening now.  The government is getting ugly.

     

    Tue, 08/23/2011 - 19:15 | Link to Comment Lord Koos
    Lord Koos's picture

    Maybe you should try living in Somalia for awhile to see how much you like living with no government at all.

    Tue, 08/23/2011 - 19:25 | Link to Comment AldousHuxley
    AldousHuxley's picture

    Somalia = shithole = no government

    North Korea = shithole = all government

     

    It is not a quesiton of how much government you have because there always will be some body of governing power whether it be military thugs are ruling family supported by foreign banksters or corporations. It matters how corrupt and efficient government is with nation's natural and human resources. Level of government just amplifies the effect. In case of Japan, government got people out of war loser status into first world. In case of recent US, government is getting people into losing wars.

    Tue, 08/23/2011 - 19:39 | Link to Comment AldousHuxley
    AldousHuxley's picture

    Government can be good or bad but groups of people will power will always exist. People must hold government accountable to be of good for the people otherwise, power will corrupt and leaders will exploit their own populace.

     

    yes, USSR sucked, but becoming indentured servent to the tune of $120k in debt for shitty useless "education" from a "non-profit" hedge fund is no better like they do with youngsters in USA. At least KGB gave USSR space race ready education for free. Also illegal Mexicans working at dark chicken farms have with no healthcare have it no better than you in USSR. USA screws people in different ways. Now they are just screwing more of everyone except the top 0.1%. sounds familiar?

     

     

    Wed, 08/24/2011 - 03:34 | Link to Comment Seer
    Seer's picture

    That you're an immigrant from the former USSR does not mean that you grasp reality!

    The removal of govt (not that I'm opposed to it) isn't going to magically solve the overarching problems facing us.  As a matter of fact, it could actually make things WORSE, that is, if big corporations were to manage to transplant govt.  But... those who are used to my posts will know that my diagnosis of the problem simply comes down to this: BIG = FAIL.  BIG means TOO much.  And, we have a BIG consumption problem, one that the finite planet (you seem to fail to grasp this reality) cannot, no matter how many times you believe that we can click our free-from-govt heels together, support.

    Wars happen because of resource shortages.  The highly sophisticated market pushes us to consume MORE.  How do you reconcile this with your view?

    Tue, 08/23/2011 - 18:14 | Link to Comment GoingLoonie
    GoingLoonie's picture

    Dear Aldous-

    Anyone that has attended a good college knows the book.  It is obvious you are too young to be the writer and you should probably not claim to be the writer.  Suicide is never the answer.  Be tough, you can make a difference.

    Tue, 08/23/2011 - 19:30 | Link to Comment AldousHuxley
    AldousHuxley's picture

    Why would I claim to be a write of a book written in 1930s?

     

    Suicide is the only solution when you discover that your life is just all bullshit. Just like investors  commit equity suicide by getting out of the market when they realize it is all bull. We are getting close to a society full of shit, so I have my name named after the author of the aforementioned book to get today's youngsters to read it instead of sexting on facebook. Have you seen the reading list of today's schools? bunch of PC garbage while banning books that tells the truth.

    Wed, 08/24/2011 - 04:08 | Link to Comment theMAXILOPEZpsycho
    theMAXILOPEZpsycho's picture

    whats your method going to be?? gun in the mouth?

    Wed, 08/24/2011 - 04:10 | Link to Comment Seer
    Seer's picture

    "Suicide is the only solution when you discover that your life is just all bullshit."

    That would be the "flight" part of "fight or flight response," and you're welcome to it, but, it solves nothing.

    It's a matter of perception.  Life is a struggle (those that don't grasp this reality need to travel [and see what the majority of humans live like]).  You cannot fight that which is irrational, you can only divest yourself of it, remove yourself from being part of it.  Yes, suicide would make this disconnect, BUT, it wouldn't reduce the irrationalities.  Humans are, by nature, deceptive (that's nature!).  Irrationality will always be with us.  However, I believe that we can somewhat evolve by understanding that BIG=FAIL (did our ex-Soviet friend "Kat" not get this?) and that this is a finite planet.

    Why get all hung up about books and such?  Live the life (or work toward doing so) that you envision (assuming that it's not irrational, in which case you couldn't possibly expect any sort of rational projection/outcome).

    I had a sister who committed suicide.  I'd told her to shit or get off the pot.  While I still miss her, I don't harbor any regrets in my advice to her: all the hand-holding counseling was doing no good; sometimes people need a kick in the ass rather than their hand held.

    I doubt that you would take the quick exit.  You're a fighter (that you're here suggests this).

    Tue, 08/23/2011 - 19:02 | Link to Comment Lord Koos
    Lord Koos's picture

    Pot is not the problem... the legal mass dispensing of Valium, Xanax, Prozac, Ritalin, Wellbutrin etc is more on point as far as keeping the worker bees working without going crazy.

    Tue, 08/23/2011 - 19:17 | Link to Comment AldousHuxley
    AldousHuxley's picture

    Pot is not the problem. Government elites using your tax money to distribute pot to calm the masses while they continue to abuse power is the problem (modern day bread and circus) when they should abdicate from leadership and let someone else lead. It is like central banksters covering up banksters with inflation after making mistakes in risk assessment of the market place (bad debt).

     

    Government dispensed pot is welfare to keep the poor down without threatening their power.

    Wed, 08/24/2011 - 04:31 | Link to Comment Seer
    Seer's picture

    "Pot is not the problem. Government elites using your tax money to distribute pot to calm the masses while they continue to abuse power is the problem"

    But it would be OK if it were "government elites using your tax money to distribute pot to calm the masses while everyone shares power?"

    It's not about pot or other drugs.  It's not even so much about "tax money*," (I bet that if it was an inconsequential amount people wouldn't care, therefore on face it's not the Thing, it's the Quantity) and it's not even about calming people.  This leaves us with only one thing: abuse of power.

    * In every culture/society there are "tithings" (don't lots of religions refer to this as "collections?") or other expected contributions.  Look within individual churches and you'll see plenty of people who don't give (yeah, they don't get locked up for this), would people refer to them as parasites?

    And about power, I don't think anyone has any grievances with power vested in the individual.  Continuing along, then, that leaves us with the problem being BIG Power.  I don' think that BIG Govt is alone in abuses of power, that any other thing would be just as problematic.  If not govt  it'd be BIG corporations or BIG religion.

    Further BIGness has occurred through the collaboration of BIG govt and BIG business.  If it were SMALL govt and SMALL business do we think there would be a problem?  BIG govt, yes, and BIG business, yes.  It's an issue of BIGness of power!

    We can't, however, expect to tame power.  The only remaining course of action is to kill BIGness.  But... we mustn't kid ourselves that this would eliminate abuses of power, as surely power and control are manifest in human nature, oppression will STILL occur, though at smaller scales, scales that wouldn't threaten the entire human race (no global reach).

    Tue, 08/23/2011 - 20:07 | Link to Comment bid the soldier...
    bid the soldiers shoot's picture

    That's mankind's future, AH.

    After SHTF, the rich go to "Brave New World" and everybody else goes to "1984"

    Tue, 08/23/2011 - 23:03 | Link to Comment obelisks
    obelisks's picture

    equally scary is the effective disappearance of the imaginary line that used to exist before delineating activities that are inappropriate for commercial interests and in which only an honest government should participate.

    For example management of prisons to protect against false imprisonment through corrupt administrators, ensuring that integrity in organ transplant surgery in that it doesn't become totally corrupted as in China where the body parts of death-row prisoners can be sold in the open market, air traffic control because privatisation only leads to taking higher risks.

    But the recent record of the Obama government in collusion with the banksters shows there is nothing to be optimistic about in this regard because everything is now based on the  commercial values of theelite. Our slide down the slippery slope is already in progress.

    Wed, 08/24/2011 - 04:43 | Link to Comment Seer
    Seer's picture

    You were fine until you dribbled the part about this seemingly sprouting under Obama's tenure.  There's a whiff of party politics...

    But, really, step back and tell me that it's an issue of direction rather than speed.  The direction was cast a LONG time ago (even before The Fed).  The rush to concentrate capital meant accelerated levels of growth.  Anyone not understanding the end result of this needs to go to the back of the bus.

    The fuse was always lit.  Problem is, we invest our powers in human hucksters (either they're predisposed, or the process turns them into it) to intentionally tell us the dream that we want to hear (human nature, or mass programming [Edward Bernays?], though mass delusion has seemingly existed since the dawn of humans).  We find ourselves in Hotel California, we can check out anytime that we want (have control over the speed of the lit fuse), but we can never leave (we've wired in our entrapment [through perpetual growth on a finite planet]).

    Tue, 08/23/2011 - 18:16 | Link to Comment Terminus C
    Terminus C's picture

    When Rome fell...

    Tech did not disappear, indeed tech improved all through the 'dark ages'.  You look at history through very narrow blinders.  The Eastern Roman Empire/ Byzantine Empire lasted another thousand years from the fall of the west.  Arabia, India and China we all highly technically advanced for the time.  From the position of England and Germany your assertion is true (to a lesser extent France, Italy and Spain) but it is regional and misguided in outlook.  Societies rise and fall but rarely die or collapse completely.

    We are on the 'bear market' side of our current societal cycle and it won't be pleasant.

    Tue, 08/23/2011 - 18:44 | Link to Comment Praetorian Guard
    Praetorian Guard's picture

    Technology was lost and those that held the keys were spread to the four winds...

     

    http://www.rome.info/history/empire/fall/

     

    "The apparent period in which technological progress was fastest and greatest was during the 2nd century and 1st century BC, which was the period in which Roman power greatly increased. Innovation continued until the fall of the Empire, and it would take hundreds of years for all of its technological advancements to be rediscovered by other civilizations."

    http://en.wikipedia.org/wiki/Roman_technology

    Tue, 08/23/2011 - 18:54 | Link to Comment Terminus C
    Terminus C's picture

    These sites give you the simplified version of history.  I do not dispute that there was technological decline in Western Europe and that there were some lost technologies but there was no major regression out side of Western Europe.

    For the lost arch: Haggia Sophia

    Read history of the Byzantine Empire such as "Lost to the West" by Lars Brownworth and you will see that our general understanding of that era of history is simplistic and regional at best.

    God's Crucible is a good history of Islamic culture in that time as well.

    Tue, 08/23/2011 - 19:19 | Link to Comment smore
    smore's picture

    Hey Praetorian, have you listened to any of the History of Rome podcasts?  They are addictive!  I'm about halfway through the series.

    http://thehistoryofrome.typepad.com/

    Tue, 08/23/2011 - 19:35 | Link to Comment Praetorian Guard
    Praetorian Guard's picture

    No, but I will check it out! Thanks!

    Tue, 08/23/2011 - 19:41 | Link to Comment AldousHuxley
    AldousHuxley's picture

    Can you just cut to the chase and tell me the ending?

    Wed, 08/24/2011 - 04:48 | Link to Comment Seer
    Seer's picture

    We run out of resources ("technology" is NOT a resource, it's a method [application of physical resources]) necessary to maintain the paradigm of never-ending growth.  Wars and or plagues visit upon us: and then the current inter-glacial period ends and we're scrubbed from the planet; evolution cranks up another big cycle.

    We all die.  The End.

    (or, the alternate ending is that we're all* whisked away via rocket-ship or "god" up into the heavens; *But only for those who have served the elites [gatekeepers to "god" and or rocket-ships])

    Wed, 08/24/2011 - 06:01 | Link to Comment OldPhart
    OldPhart's picture

    You forgot the New Age.  We're going to be shook, pummeled, cooked, and rolled under the dust.

    <shit!! can't find the right link..maybe that will do!>

     

    Wed, 08/24/2011 - 07:00 | Link to Comment Seer
    Seer's picture

    Yes, but this will happen to only the non-belivers (in techo-shit or whatever "god").  And then Mother Nature comes to bat... there's a big need to till the soil...

    Wed, 08/24/2011 - 07:05 | Link to Comment Withdrawn Sanction
    Withdrawn Sanction's picture

    Actually, technology is the application of knowledge to the problem of survival. Your extrapolation of resource exhaustion is as incorrect as it is sad b/c it ignores the role of knowledge and self interest. In his interview, DC gave the 2 keys to growth:

    "...most individuals intuitively look out for themselves by producing more than they consume and saving the difference – so the amount of net wealth in the world grows. Two, technology continues to improve – Moore’s Law and all that...

    Without being impertinent or rude, with your (negative and linear) worldview, why are you still here? Again, I dont mean to be rude, Im really just curious.

    Wed, 08/24/2011 - 14:42 | Link to Comment bid the soldier...
    bid the soldiers shoot's picture

    "Actually, technology is the application of knowledge to the problem of survival."

    Aren't you conflating 'survival' with 'making a buck'?

    What did the Spinning Jenny have to do with survival?

    Wed, 08/24/2011 - 14:24 | Link to Comment bid the soldier...
    bid the soldiers shoot's picture

    Short, sweet and to the point.

    Well done. I like it.

    Tue, 08/23/2011 - 19:12 | Link to Comment bid the soldier...
    bid the soldiers shoot's picture

    When Rome fell there was as much oil in the ground as there was when Romulus and Remus suckled the she wolf's teat.

    When the second Rome falls, they'll be running the movie of the story of civilization in reverse.

    Wed, 08/24/2011 - 07:02 | Link to Comment Seer
    Seer's picture

    http://dieoff.org/page125.htm

    (esp see Figure 1)

    Tue, 08/23/2011 - 17:15 | Link to Comment Ruffcut
    Ruffcut's picture

    Well, if you are an old fuck, with a few bucks left in your account, you've had a hellava ride. If you are young, you are totally butt fucked by yesterdays luxury.

    If you are middled aged, you are having a helleva of ride, paying a lot of bucks, getting a luxury buttfucking, yesterday already, and charged on your account.

    Wed, 08/24/2011 - 04:53 | Link to Comment Seer
    Seer's picture

    That would be mostly applicable to the western world.  2/3 of the world's population (none of us here!) live on $3/day or less.

    That which isn't sustainable WILL end.

    Yes, time to come clean with the youth.

    Tue, 08/23/2011 - 17:18 | Link to Comment gwar5
    gwar5's picture

    Doug Casey is awesome.

     

    I never felt like there was a recovery. The numbers were faked and ginned up, and the MSM was going into overtime, but nothing was happening and people haven't stopped being depressed and looking for jobs.

    Casey is the ultimate sovereign man, with several homes abroad, and passports. It doesn't take much traveling abroad to understand the fragile nature of the USD.

    In many countries, people want your USD because their currencies have already been trashed. That's changing. Now it's our turn and it's easy to appreciate how sentiment against a currency can change, and how it can get kicked to the curb overnight. 

     

     

     

     

     

    Wed, 08/24/2011 - 04:59 | Link to Comment Seer
    Seer's picture

    "Casey is the ultimate sovereign man, with several homes abroad, and passports."

    Can you say TARGET?  As the majority of humans on this planet struggle further I'd hardly want to flaunt myself in such a manner.

    In terms of describing how fucked up the current economic situation is I'd say that Casey it correct.  But as to the REAL underlying reason, well, he's another member of the infinite-world club; and, well, his life(style) pretty much depends on this thinking (and the promotion of it).  Unicorns and Skittles can be had by all!

    Tue, 08/23/2011 - 17:21 | Link to Comment molecool
    molecool's picture

    Video wrap up of today's short squeeze: 

     

    Ghost In The Shell – 2011-08-23 -

     

    http://evilspeculator.com/?p=23383

    The future is now!

    Tue, 08/23/2011 - 17:26 | Link to Comment AldousHuxley
    AldousHuxley's picture

    There hasn't been a recovery since 2000!

    Boomers complain about 401k and declining home values and age discrimination after living large 30 years, but for real victims ask to see how their NINJA generation (No Income, No Job, No Assets) kids are doing. No job since most are offshored or outsourced to non-Americans,  no 401k instead 401k in student loan debt, no assets/home since they can't afford $500k squalor in the ghetto next to family of illegal Mexicans. Only top 1%'s kids with connections and family wealth got ahead in last 10 years.

     

    Greedy old American elites are creating young educated future rioters who have nothing to lose. Just wait until 20something vets come home to no job but with military training. Riot police or even SWAT is no match for sniper with combat experience. Any wonder  military pension is always the last one cut by the government?

    Tue, 08/23/2011 - 17:33 | Link to Comment centerline
    centerline's picture

    One of the factors in the fall in the Rome was failed/broken promises to soldiers by the state.  Maybe one reason why we haven't made better progress towards bringing our folks home.

    Tue, 08/23/2011 - 18:09 | Link to Comment toady
    toady's picture

    That is interesting... I haven't heard that angle before...

    So the financial world crumples and they leave GI's all around the globe. Go back a year later and the survivors will gladly become your own personal mercs for three squares and a cot...

    Smart bastards!

    Wed, 08/24/2011 - 00:10 | Link to Comment AldousHuxley
    AldousHuxley's picture

    sure why not? US is already using mercenaries (blackwater) or foreign citizens themselves.

    Rome failed because empire was stretched too thin so they hired colonized soldiers as empire soldiers. Later they became generals within ranks and fought against Rome for independent control.

     

    You can only outsource so much until you lose control.

    Tue, 08/23/2011 - 19:21 | Link to Comment joe.schmuck
    joe.schmuck's picture

    A similar incident occured in the US after WW1, where the Bonus Army tried to march on DC from Anacostia, but was stopped by tanks commanded by Patton and MacArthur commanding infantry

    http://en.wikipedia.org/wiki/Bonus_Army

    Tue, 08/23/2011 - 18:05 | Link to Comment GoingLoonie
    GoingLoonie's picture

    Dear Aldous:

    Now you know why we have so many wars going half way around the world.  Rome actually out lawed the return of their warriors.  We may do the same.  In case you haven't firgured this one out;  The people running this Country do not care about the Country and they are not nice people.

    Wed, 08/24/2011 - 00:14 | Link to Comment AldousHuxley
    AldousHuxley's picture

    It is all about money my friend.

     

    People will be nice to you if you give a big tip.

    Wed, 08/24/2011 - 05:59 | Link to Comment Seer
    Seer's picture

    It's about POWER.  Money represents power, but it's only a representation of it, and, as we can see, money itself can be an illusion (thereby being an illusion of power), such as when its value is (near) worthless.

    Tue, 08/23/2011 - 19:59 | Link to Comment Bicycle Repairman
    Bicycle Repairman's picture

    "Greedy old American elites are creating young educated future rioters who have nothing to lose. Just wait until 20something vets come home to no job but with military training. Riot police or even SWAT is no match for sniper with combat experience. Any wonder  military pension is always the last one cut by the government?"

    The young and educated have plenty to lose: their lives.  My prediction?  Sporatic violence followed by crushing repression followed by no violence. 

    Wed, 08/24/2011 - 02:08 | Link to Comment bid the soldier...
    bid the soldiers shoot's picture

    Don't forget 2 minutes Hate.

    It's funny how so few people want to die. At any age. I guess it's in our genes.

    Wed, 08/24/2011 - 06:05 | Link to Comment Seer
    Seer's picture

    Experience is fine, but without the means...

    How can people think to combat drones, LRADs (long-range-acoustic devices), satellite-controlled weaponry?

    Yes, one need only look at what the locals in the Afhgan and Iraq wars are/have been able to do, but... the ability of the EMPIRE to kill is becoming extremely capable (and indescrimination doesn't seem to be an issue- read "everthing is acceptable collateral damage [except, of course, to them and the result of the rulers]).

    Tue, 08/23/2011 - 17:27 | Link to Comment Pontificating B...
    Pontificating Buffoon's picture

    Oh dear God, if only the government would "do something" by absolutely doing "nothing."

    Wed, 08/24/2011 - 06:08 | Link to Comment Seer
    Seer's picture

    "The chief cause of problems is solutions." - Eric Sevareid

    I'd ask that the govt do ONE thing: implode- taking big corporations and big religion with it!

    Tue, 08/23/2011 - 17:27 | Link to Comment John Law Lives
    John Law Lives's picture

    There's nothing quite like a 300+ point rise in the DJIA on the heels of dismal economic news to instill confidence in the markets...

    100% FUBAR.

    Tue, 08/23/2011 - 17:46 | Link to Comment Kat
    Kat's picture

    It was pretty clear.  If we're in a recession (which is what those numbers implied when added to the other data), then the Fed has to put lipstick on the pig...I mean print money.

    The probability of the discredited monkeys at the Fed firing up the printing presses just rose tremendously as the market digested those numbers.

    Imagine the parabolic market we'll get when Bananking actually announces more worthless currency coming off the presses from Jackson Asshole on Friday.

    Tue, 08/23/2011 - 18:07 | Link to Comment John Law Lives
    John Law Lives's picture

    QE3 may be formally announced in some form soon, but large scale asset purchases (LSAP) may not be easy to initiate this time.  Bernanke may not be willing to stick his neck out quite so far knowing that 3 voting Fed members voted against him re. extending near-ZIRP through 2013.  Chairsatans want to be re-appointed to their positions just like anyone else.

    Tue, 08/23/2011 - 17:31 | Link to Comment vast-dom
    vast-dom's picture

    1. Hyperinflation;

    2. Gold Parabolic;

    3. Junior Gold Miners follow;

    4. Bond market collapses;

    (pretty obvious, just don't forget about:)

    5. SILVER PARABOLIC.

    Tue, 08/23/2011 - 18:26 | Link to Comment bill1102inf
    bill1102inf's picture

    Never happen, we already hyperinflated housing, now we deflate

    Tue, 08/23/2011 - 17:32 | Link to Comment Long-John-Silver
    Long-John-Silver's picture

    Rollover 1981 Movie. This reads like the script for that Movie. If you haven't seen the short version on Youtube, you really must watch it.

    Rollover-1981- Depiction of Global Worldwide Economic Collapse in 2011

    http://www.youtube.com/watch?v=6butfe1f9Hg

     

    Tue, 08/23/2011 - 17:39 | Link to Comment lindaamick
    lindaamick's picture

    I live in a small (1800 people) town.  I have been here 2 1/2 years.  There is really no economy here except for a few chicken processing plants.   Over the past two years I am noticing more "baa's" and crowing around.  My neighbor has a tractor and he says he has been harrowing small gardens all over the area.   Another guy is making money cutting down trees so that people can enlarge their garden areas.   I little local co-op got started up the street.

    Why does a collapse have to mean starvation, death and destruction?

    Isn't it possible for locals to become MORE of a community; helping one another out?   It is not hard to grow food if there is enough water and sun.  Most soils will do it.   Admittedly there is no "Salary" in it, but if times get rough it is subsistence. 

    I just hate the armaggedon perspective.  It denigrates the human spirit.

     

    Tue, 08/23/2011 - 17:52 | Link to Comment Kat
    Kat's picture

    Because, my dear Linda, subsistence farming is poverty.

    Because I'm sure that we humans will figure out a way to survive.  I have no doubt.  But, that doesn't mean that there's anything good in destroying that which we've already worked hard for all of our lives. 

    There is nothing to celbrate in the government destruction of the wealth we've managed to create.  It is like a war the government fights and the booty is your savings - everything you've ever worked and sacrificed for.  The people who will lose the most are the ones who were the most hardworking and prudent. 

    Destroying them teaches us that such sacrifices aren't worth it.  There's no point in being honest and prudent if it'll just be stolen from you. Eventually, your farming community will learn that too.  It's a terrible lesson.

    War is never a good thing.

     

     

     

    Tue, 08/23/2011 - 17:57 | Link to Comment Kat
    Kat's picture

    Linda,

    Here's another way to think about it.

    When you have a natural disaster, communities also pull together to help each other out.   People get creative.  That's great.

    But would you call the natural disaster or the destruction it wrought a good thing? A plus for the community?  Of course not. 

    Destroying that which is already created is never a good thing. 

    Wed, 08/24/2011 - 07:09 | Link to Comment Seer
    Seer's picture

    "Destroying that which is already created is never a good thing."

    Hm... perhaps Mother Nature feels the same way, and that's why entropic forces undo humankind's destruction of nature?

    Oh, but it's all about "us," about our god-like ability to rise above nature, to be outside of nature.

    Oh, and maybe we should un-destroy all the old USSR nukes?

    Be consistent.  Logic, FAIL!

    Tue, 08/23/2011 - 18:33 | Link to Comment Praetorian Guard
    Praetorian Guard's picture

    ...because the worthless eaters and "have nots" don't give a shit about you or I. Nor do they care about peace and working together to make a better life. All they care about is ME, MYSELF and I, and that is all!! They will steal, kill and loot to get their next fix - just look at NO, LA and other towns. This is what scares the shit out of me, though I have years of training countering such individuals. I can make a go at it, yet the general populace and the MEism that pervades is the unquantifiable factor...

    https://www.gunsgrubandgold.com/forum 

    Wed, 08/24/2011 - 07:11 | Link to Comment Seer
    Seer's picture

    Yeah, the politicos and their henchmen (police etc.) have been leaching off the people of NO for a LONG time.  Great call!

    Tue, 08/23/2011 - 19:00 | Link to Comment alien-IQ
    alien-IQ's picture

    it's harder to grow your own food in a 350 square foot 5th floor walk up on the lower East side than it is out in the country.

    Wed, 08/24/2011 - 07:14 | Link to Comment Seer
    Seer's picture

    As well as it would be, say, up in the hinterlands of Alaska...

    A nice example of why over-generalizing (painting with a big brush) is problematic.

    Oh, I tell vegan folks that I know that I'd sign up when they manage to get the eskimos to sign up.

    Wed, 08/24/2011 - 06:17 | Link to Comment Seer
    Seer's picture

    And there you have it, it all boils down to "subsistence."  Using more energy than you can replace fails.  It's a matter of what can be sustained, and, by mathematical fact, growth doesn't meet this criterion.

    Even much of the local trade will fail in the future as a lot of the existing infrastructure (such as roads) fails.  This isn't doomer stuff, it's reality: "doomer" would be to insist on a course that leads one into a corner or over a cliff (such as is our dominant paradigm).

    Tue, 08/23/2011 - 17:46 | Link to Comment Cdad
    Cdad's picture

    OT:

    Over at the BlowHorn[CNBC], on the Nanosecond Money show, they took a shot at your cred there, Tyler.  In association with the Blodgett piece and his reference to your research, some third rate scrub dipshit named Steven said about ZH, "Stories are planted there."

    LOL!  This coming from a guy who reads a script written by bankers.  Sweet!  Credibility War!  Let's go let's go.

    Maria "lost my curiosity years ago" Bartiromo

    Joe "the tape chaser" Teranova

    Bill "should have stayed on leave" Griffith

    Jim "the hedge fund shill" Cramer

    Joe "bumper music" Kernen

    Tyler "I have no redeeming qualities" Mathisen

    John "options book pushing junkie" Najarian

    Pete "we talkaboutit" Najarian [his slower brother]

    and Steven "no one invites me to cocktail parties" Weiss.

     

    Maybe if these people [and those I forgot to mention] worked a bit harder on their own credibility, they would not need to throw stones.  Maybe they should be reporting on the situation at Blight on America bank rather than calling to question others that have.  Novel idea?  Journalism anyone?

    As far as I am concerned, and considering COMCAST's failure to do anything to address the obvious malfunction within this network, I think the broadcast license should be pulled.

     

     

    Tue, 08/23/2011 - 18:07 | Link to Comment Crack-up Boom
    Crack-up Boom's picture

    Stories are "planted" on ZH, but they grow naturally on the MSM garbage dumps??  The fact that they're deriding ZH means ZH is getting the point across!  Congrats, ZH, on a job extremely well done!!

    Tue, 08/23/2011 - 18:50 | Link to Comment alien-IQ
    alien-IQ's picture

    Remember the last CNBC monkey to try to take on ZH? Dennis Kneale. His next assignment was the unemployment line. So too shall it be for these morons should they chose to go any further down that road.

    Let's hope they do.

    Another ZH vs. CNBC reality check anyone?

    Tue, 08/23/2011 - 19:47 | Link to Comment AldousHuxley
    AldousHuxley's picture

    CNBC...GE propaganda machine. They needed obama to bail out GE financials. Nothing good except Rick Santelli once in a while.

    NBC HQ is at GE building on 30 Rockefeller Center. Rockefellers have room 5600 of GE building as their HQ aka. Family Office.

    Wed, 08/24/2011 - 06:33 | Link to Comment Seer
    Seer's picture

    "Maybe if these people [and those I forgot to mention] worked a bit harder on their own credibility, they would not need to throw stones.  Maybe they should be reporting on the situation at Blight on America bank rather than calling to question others that have.  Novel idea?  Journalism anyone?"

    Isn't this like asking Satan to tell the truth?

    It's their JOB to lie!  They are the Praetorian Guard for the ruling elite.

    Expecting anything else is being irrational.

    I stopped watching TV years ago.  Walk away from the circus, withdraw your energy and money from it and it'll disappear like the vapor that it is...

    Tue, 08/23/2011 - 17:49 | Link to Comment lunaticfringe
    lunaticfringe's picture

    I don't know about you peeps...but I am getting sick of dying the slow death. C'mon Kervorkian let's kill this mutha now so we can get it over with.

    Tue, 08/23/2011 - 17:52 | Link to Comment Cult of Criminality
    Cult of Criminality's picture

    Cdad they have no credibility

    Tue, 08/23/2011 - 18:02 | Link to Comment Gimp
    Gimp's picture

    The makers will survive after disposing of the takers...

    Tue, 08/23/2011 - 18:23 | Link to Comment fyrebird
    fyrebird's picture

    But there sure are a lot of takers ...

    Oh and BTW ... what is a maker?

    Tue, 08/23/2011 - 19:25 | Link to Comment smore
    Tue, 08/23/2011 - 21:25 | Link to Comment Prometheus418
    Prometheus418's picture

    That's what the Fremen called the big sandworms on Dune.

    Tue, 08/23/2011 - 18:15 | Link to Comment buzzsaw99
    buzzsaw99's picture

    Even dumbass Perry can see that the bernank is a traitor.

    Tue, 08/23/2011 - 18:58 | Link to Comment cynicalskeptic
    cynicalskeptic's picture

     

    "But unemployment has remained high; it’d actually be about twice the official 9% level, if it was calculated the same way it was 30 years ago."

     

    Why is unemployment being UNDERSTATED - even by those who know the statistics are fudged.  

    Unemployment is now over 22% - as bad as it ever was during the Great Depression - it is far more than 'twice the official rate' - which would be only 18%

     

    http://www.shadowstats.com/alternate_data/unemployment-charts

    Wed, 08/24/2011 - 06:41 | Link to Comment Seer
    Seer's picture

    Because people would riot.

    It's a lot like stumbling on some horrific accident in which someone is severely injured.  You DON'T tell them how bad something is, as that might promote shock (and death).  However, unlike this scenario/analogy, the current tactics vis a vis the economic situation ISN'T going to result in anything other than the death of the system.  It's inevitable.  But, as they say, seeing is believing: kind of hard to accept a lying govt (which is ANY govt) actually telling the truth (the next to the throne, BIG business, will discount/distort any message that might be detrimental to them achieving more power- translation: people cannot believe anything they hear [just what they see]).

    Tue, 08/23/2011 - 19:10 | Link to Comment defencev
    defencev's picture

    People like Doug Casey just irritate me. He just tries to scare the sheep but says nothing profound. His arguments are primitive:

    there are trillions of paper dollars sitting in bank or central banks reserves. Some day they will fy out creating general collapse of Dollar. The interest rates are low and that is the mother of all problems. Therefore buy gold and gold stocks. It is difficult to disagree with that and perhaps almost everybody understands that. The thing is there is no way to exchange fiat paper on anything of value. Gold market too small to absorb it. Perhaps one day when Yuan will be ready to take place of the  dollar as a world reserve currency we can see collapse of the former but it is probably a decade from now.

     In my view Marc Faber who does advice old good diversfication: 20 percent PM, 20 percent corporate bonds, 20 percent in stocks, 20 percent cash and the rest in real estate is much closer to reality.

       Doug Casey makes no sense to me...

    Tue, 08/23/2011 - 19:59 | Link to Comment Pants McPants
    Pants McPants's picture

    If you are serious and not trying to bait people, I highly recommend you read more of Doug Casey's material.  He's one of the good guys - truly a self-made man who puts his money where is mouth is.

    Stick with it, Casey is worth it.

    Tue, 08/23/2011 - 20:20 | Link to Comment defencev
    defencev's picture

    He is may be a good guy but he is absolutely wrong in his recommendations. Besides, he provides paid service which makes recommendations regarding explorer companies. Thus, I see a clear conflict of interest when he tries to promote exactly that.

    I am not going to stick with him or anybody else for that matter and would not  recommend anybody to do that either. All these guys (good or bad) are after sheep's money...

    Wed, 08/24/2011 - 06:48 | Link to Comment Seer
    Seer's picture

    Nothing wrong with walking one's talk.

    I tend to agree with what you've stated here.  And, yes, all these talking-heads, are, for the most part, living off of talk and NOT action (not producing anything real).

    But, as I noted above (somewhere), I discount Casey's understanding of how the world works when he puts forth the technology-will-save-us and the world is infinite crap.  Again, and I hope that people get it, I give credit where credit is due and lambast that which cannot hold up against reason and logic (and despite any sembemblace of personal attacks, I'm really only trying to pummel bad logic).

    Tue, 08/23/2011 - 21:00 | Link to Comment SmoothCoolSmoke
    SmoothCoolSmoke's picture

    Regarding Kass....what am I missing here?!?!  He's on Fsat Money tonight:

    1.  Everyone is too bearish

    2.  No double dip

    3.  XLF up 50-100% in 6-9 months.

    That don't sound like "Exiting the Eye of the Storm" talk.

    What am I missing here?

     

     

    Tue, 08/23/2011 - 21:05 | Link to Comment Cdad
    Cdad's picture

    what am I missing here?

    Casey

    Wed, 08/24/2011 - 10:11 | Link to Comment windcatcher
    windcatcher's picture

    Mr. Casey’s insight is refreshing and illuminating although it is full of economic and social doom and gloom for Americans and the rest of the World in the immediate future; corporate/government fascism is always ugly.

     

    Casey alludes to “bad decisions” as the root cause of this world economic and social dilemma which is half right; what if the decisions were “well planned out decisions”?

     

    The criminal bankster mortgage fraud fiasco was a well planned debacle complete with an illegal Mortgage Electronic Registration System. The events: 9/11, weapons of mass destruction, QE 1&2, multinational corporate Oligarchy, loss of US sovereignty, 5 on going wars, NAFTA, NAU, globalization and “global Free Trade” (free to who?) were not by accident of a poor decision; they are all planned and executed with a fascist global intent. There is a clear criminal purpose and intent by the actors behind all of these actions.

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