In a vise between government crack-downs and reluctant students
Shining a little reality light on the otherwise pollyanna-like dearth of pragmatism that is the mainstream media's guest-list, Ron Paul provided Bloomberg TV's Trish Regan a little more than we suspect she bargained for when asked if he had any hope that we avoid the fiscal cliff. The constant "delaying-of-the-inevitable" enables our politicians to avoid facing up to the serious consequences of our reality and as Representative Paul notes the chances of a grand bargain are "probably zero... that's why I think we're over the cliff [already]." Just like the handling of the debt ceiling debacle, Paul notes they will "pretend they are going to do it" until we get a total crash of the dollar and the entire financial system (which he notes is what will occur if we continue the status quo). "We are at a point of no return" unless certain things change, since "we are not the productive nation we used to be."
America is over $16 trillion in debt. The “official” unemployment rate still hovers around 8%. Our federal government claims the right to spy on American citizens, indefinitely detain them, and even assassinate them without trial. Domestic drones fly over the country for civilian surveillance. Twelve million fewer Americans voted in 2012 than in 2008, yet political pundits scratch their heads. It’s not hard to see why, though.
From an outright libertarian, the headline seems contrary; but Ron Paul's affirmation that "pure democracy is dangerous" critically confirms what Romney accidentally admitted: that enabling the majority to dictate the minority is a problem when the majority are receiving a [government] check. Bloomberg TV's Betty Liu looks a little shocked when the thoughtful Paul confirms bluntly that the reelection of Obama is driven simply by 'the people' being on the 'receiving end' of government benefits and that the US is "so far gone; we're over the cliff already." From the lack of credibility in Washington to GOP's 'acceptance' of higher taxes and why he quit Congress, Ron Paul succinctly reminds many of the true state of the union in which we live... "As long as you think we have to please the world and run this welfare state, all we will argue about is who will get the loot."
We are programed to cheer and act out our sheep-like roles in partisan politics when, like the game, unless we have money bet on the outcome the actual winner will have absolutely no impact on our lives. The bottom line is that voting percentages generate credibility for the failed American political system. "There's not a dime's worth of difference between the Democrat and Republican parties." George Wallace, 1966 Alabama governor and presidential candidate. Romney lost for two main reasons: First, as he correctly noted during the campaign, 47 percent of American families are dependent on government handouts and they voted for what was in their own best interests; and second, the GOP leadership antagonized the 10 percent of the Republican Party electorate who supported Ron Paul for President. And so over the next four years the people will be provoked and buy more guns they will never have the courage to use to defend themselves against an all-powerful government. The game will go on until the time is up for our nation. It is time we as a generation man up for liberty to redeem ourselves in the tear-filled eyes of future generations. The American people must work peacefully to restore the Articles of Confederation now or else suffer the permanent consequences of the fall of America.
Investors should prepare for rising prices and more expansionary monetary policy now that President Barack Obama has won re-election, investor Jim Rogers told CNBC on news of the election. The co-founder with George Soros of the Quantum Fund said he expected Obama’s policies to drive up commodities and drive down the U.S. dollar. As the Federal Reserve moves to ‘stimulate’ a stalled economy through debt purchases, Rogers says markets should expect the status quo to remain the same. “If Obama wins, it’s going to be more inflation, more money printing, more debt, more spending.” Rogers told CNBC, saying he expected to sell U.S. government debt and buy precious metals, such as silver and gold. “It’s not going to be good for you me or anybody else.”
Rampant Evidence of Electronic Vote Tampering
Liberals and Conservatives Agree: Vote Third Party ... Plus Why Many Ron Paul Supporters (Like Me) Are Voting for Gary Johnson
Government programs created in the 1960s created a culture of dependency, government control, relentlessly higher debt, materialism, and willful ignorance. The incompetence, arrogance, ineptitude and insanity of government officials at the Federal, State, and Local level are stunning to behold. We need to ask ourselves whether we the people are getting better government service and efficiency today; with government spending at 35% to 40% of GDP, than we did in the 1950’s and early 1960’s when government spending was 20% to 25% of GDP. We doubt that most people are getting 60% more value from our benevolent government today than they did in the 1950’s. By encouraging dependency and reliance upon the all-powerful government, the motivation to educate yourself, get married before having children, work hard, and pull yourself out of poverty is diminished. Can a small minority of critical thinking citizens lead a revolution that topples the existing social order and restores the Republic to its founding principles of liberty, self-responsibility, civic duty, and mutual obligation to future generations?
In what follows, we will examine the adjustment process necessary to shift from a system with fiat money and a reserve ratio below 1 (reserve requirement under 100%). Let’s begin clarifying that this proposed delevering process is an ideal situation, applicable if one had the luxury of planning the shift. There is not always time to do so and, if we ever had any, we’re running out of it pretty fast. The adjustment process below could only be done very gradually, by adjusting the reserve requirement and gold holdings by the central bank a few bps every year (say 200bps). The ultra-necessary condition here is that the nation undergoing this process be able to generate an equivalent fiscal surplus, in percentage terms. For instance, the process could demand to cover 2% per year of the gap in the reserve ratio to reach 1 (50 years long!!!). This means that if the reserve ratio is 10%, the gap is 90% and narrowing it over 50 years would require to increase reserves by 1.8% every year (90%/50). Because the delevering process should be accompanied by a pari passu reduction in the fiscal deficit and sovereign debt, that 2% annual adjustment, in the US, this would require a surplus of $324BN every year, over 50 years ($16.2 trillion in national debt x 2%). In 2012 terms, spending would have to be cut by $1.52 trillion ($324 billion + $1.2 trillion annual deficit), if the numbers we have are correct. We suspect they are not: The situation is even worse. But, the bottom line is that, once you see these numbers, you realize that going back to a world of no leverage is politically impossible. Even though it is technically feasible, just like the European Monetary Union was planned and built over decades, it is still politically impossible.
Readers may recall that Ron Paul once surprised everyone with a seemingly very elegant proposal to bring the debt ceiling wrangle to a close. If you're all so worried about the federal deficit and the debt ceiling, so Paul asked, then why doesn't the treasury simply cancel the treasury bonds held by the Fed? After all, the Fed is a government organization as well, so it could well be argued that the government literally owes the money to itself. He even introduced a bill which if adopted, would have led to the cancellation of $1.6 trillion in federal debt held by the Fed. Of course the proposal was not really meant to be taken serious: rather, it was meant to highlight the absurdities of the modern-day monetary system. In a way, we would actually not necessarily be entirely inimical to the idea, for similar reasons Ron Paul had in mind: it would no doubt speed up the inevitable demise of the fiat money system. Control can be lost, and it usually happens only after a considerable period of time during which their interventions appear to have no ill effects if looked at only superficially: “Thus we learn….to be ignorant of political economy is to allow ourselves to be dazzled by the immediate effect of a phenomenon."
Guest Post: On Currency Swaps And Why Gartman May Be Wrong In Focusing On The Adjusted Monetary BaseSubmitted by Tyler Durden on 10/14/2012 13:53 -0400
Last week Dennis Gartman, in his homonymous letter said that he was concerned about the fact that the adjusted monetary base has been falling, rather than rising, taking away the bullish case for gold on the topic of “money printing”. One must therefore remind those with this concern that the credit expansion caused by the backstop of the Fed alone is enough to inflate asset prices. This is consistent with the case we made in our last letter, that a commodity based standard is not as relevant as having a 100% reserve requirement. By the same token, if the reserve requirement is below 100%, it is not that relevant to see the expansion of the monetary base! The “printing of money” will eventually come, when EU corporations begin to default and the Fed has to “ensure there is enough US dollar liquidity”. It happened in 1931-33, in spite of the fact that the adjusted monetary base had been contracting since 1929: The US dollar was devalued from approx. $20.65/oz to approx. $34.70oz and gold was confiscated.
Ron 'I'm playing the long-game' Paul will not go quietly into the night - and rightly so, it would seem, given his truthiness. In a recent brief interview on CNBC's Futures Now, he managed to diss Romney, smash the 'belief' in a 'two-party' system, and undermine any hope for economic change from the farce of an election. Summed up simply: "There is essentially no difference between one administration and another, no matter what the platform."