The Ponzi Economy
Pimco's Bill Gross on Scoping Out Subprime - The co-founder of Pimco, the $1 trillion-plus fund manager, avoided the subprime bubble by turning his analysts into fake home buyers - Bloomberg Businessweek - Diane Brady - June 9, 2011 - In 2006, there were signs that this had become a highly leveraged Ponzi economy and that housing was at the pinnacle of this leverage. The temperature of the U.S. housing market was always best read here in Orange County [Calif]. But one day that August, as I was going across the street for my daily yoga exercise, it occurred to me that we needed to get a feel for the rest of the country... We had 40 credit analysts covering companies like IBM (IBM) and General Motors (GM). I thought: Why not take 10 of these people and turn them into pretend real estate buyers? Instead of sending them to Armonk to interview the treasurer of IBM, let's send them to places like Detroit, Miami, or Vegas to pretend to be in the market to buy a house. They didn't have a bankroll, and they obviously weren't going to buy a house. Nonetheless, I gave each of them a territory and told them to go there two or three times a month until June 2008. They were told to be serious buyers, to get serious information... There was no pushback, but I wondered whether it was kosher. I wasn't necessarily proud of the obvious deception. But this little bit of trickery alerted us to what was really going on: the liar loans and the extravagant lending practices. We got much better real-time information, and we learned homes were being bought without a down payment or without documents to prove income. The extent of the lending malpractice—to use a nice word—was shocking, and it caused us to stay out of the subprime market.
China’s economy: Burgeoning giant or bubble ready to burst? - Globe and Mail - Brian Milner - June 16, 2011 - Unlike deficit-ridden governments in the U.S. and Europe, Beijing was – and still is – swimming in surpluses. So money was no object. The Chinese leadership was highly motivated to do whatever it took to get the economy back on the fast track. Strong economic growth is vital to maintaining the country’s improving living standards, keeping social unrest in check, greasing the wheels of China’s unique version of state capitalism and ensuring that the Communist Party’s hegemony remains unchallenged... China’s heavy pump-priming worked. Major infrastructure and social-housing projects got off the ground quickly. A flood of subsidies kept large numbers of factories open, avoiding the spectre of millions of unemployed migrant workers taking to the streets. But the influx of cheap credit and investment capital has also created dangerous bubbles in real estate and other assets... It’s on the domestic front where China’s frailties stand out – a feeble financial system, falling consumption as a share of GDP, weak job growth, major inefficiencies in state-dominated sectors and unfavourable demographics stemming from the one-child policy – and where dreams of global domination are most likely to come unglued.
Stimulating a Dead Economy - Huffington Post - Jim Worth - 06/17/11 - The U.S. economy is surviving only because of over-stimulation. We're living on fumes in this country, and the pursuit of happiness has come to an end for millions of families! Main Street is still suffering. But, the market is on Viagra, shored up by QE2, the Fed program to buy hundreds of billions of dollars in U.S. Treasury Bonds. As QE2 winds down, and the economy falters, the discussion turns to the possibility of QE3. A tremendous number of band-aids have been administered to keep the U.S. economy from hemorrhaging; to prevent not only a domestic collapse, but a global one... The Fed's covert loans, exposed by Bloomberg's lawsuit under the Freedom of Information Act, and brought to the attention of the American people by Senator Bernie Sanders and Representative Ron Paul, shows some despicable -- potentially criminal -- actions in the program including loans to Muammar Gaddafi totaling more than $26 billion. The President's Housing Affordable Modification Program, designed to help homeowners, was pretty much a failure and has done little to stabilize the housing market. The FDIC's loss-share program is a fire-storm waiting to explode and the Treasury's $300 billion guarantee to Citibank is a hidden time-bomb that falsely supports over-priced Citi stock... There are subsidies to oil companies and agriculture corporations, and other equally destructive giveaways. (The Hound doesn't believe in his summation that it is all the Republican's fault, but I am still scratching my head about why we are giving huge tax breaks to corporations who don't seem to give a crap about U.S. economic interests).
U.S. Economic Outlook
IMF Sees Risks to Global Economy Mounting - Wall Street Journal - Sudeep Reddy - June 17, 2011 - The International Monetary Fund released its latest global economic forecast Friday, cataloging risks that have piled up in the world economy over just the past two months... The IMF says it still expects global growth of 4.3% this year, down slightly from the 4.4% estimate offered in April in what it called a “mild slowdown of the global expansion.” Among advanced economies, the U.S. is seen growing at 2.5% (slower than the prior 2.8% estimate) while Japan is expected to contract 0.7% (instead of 1.4% growth).
Alan Simpson, Erskine Bowles Predict Coming Economic Crisis - Newsmax - Forrest Jones - June 18, 2011 - A crisis will strike the U.S. economy within two years if politicians don't roll up their sleeves and address fiscal spending like they did in the 1990s, warns former Sen. Alan Simpson. Simpson, a Republican who co-chaired President Barack Obama's National Commission on Fiscal Responsibility, says the United States faces "the most predictable economic crisis in history" by 2013. His remarks echo comments made by his partner in studying deficit reduction, Democrat Erskine Bowles, according to CNS News. The tipping point "will come when the rating agencies find out we Economy, Alan Simpson, Erskine Bowleshave no plan" to seriously address federal spending and the national debt, Simpson says... Simpson, along with Bowles, former President Bill Clinton's chief of staff and co-chair of the spending committee, have warned that fiscal deficits must narrow if the U.S. economy is to recover at a more adequate pace. Simpson says Bowles reached across the aisle to craft policy and acted in the interest of the country, and not just in his political party when in office. "How do you think he did the balanced budget in '96?" Simpson asks... Earlier this year, Simpson told the Senate Budget Committee that the United States was headed toward financial disaster unless spending was curtailed. "This debt and these deficits that we are incurring on an annual basis are like a cancer, and they are truly going to destroy this country from within unless we have the common sense to do something about it.” (The Hound agrees with Simpson and Bowles premise, but unless the Financial Banking Cartel is brought back into line, then they are wasting everyone's time. They are talking about saving Trillions over a decade, which history shows can never be guaranteed, while trillions in spending will go on as usual. A few years ago a $400 billion deficit was looked upon as a disaster and now $1.5 trillion dollar deficits with hopefully a couple hundred billion in cuts is supposed to cure the problem. All of this doesn't even include what is taking place off budget. This is all window dressing on the Titanic. This mindset is not going to cure the ills that we face!!!)
Germany Fires Debt Shot at US - Goldseek.com - Dr. Jeffrey Lewis - June 16, 2011 - In what will likely be the first of many European debt downgrades for the United States, Germany’s own Feri credit rating agency took down the United States’ debt rating from AAA to AA. The difference is marginal in many ways (after all, few countries ever get to become AAA rated), but for the United States, which has always been AAA, this confirms that the downside is here. In addition to downgrading the United States’ debt, the agency also had a few warnings for Washington DC. The ratings agency CEO Tobias Schmidt is reported as saying, “The U.S. government has fought the effects of the financial market crisis primarily by an increase in government debt. We do not see that there is sufficient attention being paid to other measures.” Later on in the release, he would remark that the current deficits are not sustainable.
How Miserable? Index Says the Worst in 28 Years - CNBC - Jeff Cox - June 17, 2011 - When it comes to measuring the combination of unemployment and inflation, it doesn’t get much more miserable than this. In fact, misery, as measured in the unofficial Misery Index that simply totals the unemployment and inflation rates, is at a 28-year high, reflective of how weak the economic recovery has been and how far there is to go. The index, first compiled during the soaring inflation days of the 1970s by economist Arthur Okun, is registering a nausea-inducing 12.7—9.1 percent for unemployment and 3.6 percent for annualized inflation—a number not seen since 1983. The index has been above 10 since November 2009 and had been under double-digits from June 1993 through May 2008... Investor sentiment continues to fall. The latest Investors Intelligence survey, a weekly poll of newsletter authors, points to bulls outnumbering bears by just a 37 percent to 26 percent margin. Yes, it does indicate more people believing the market is heading higher than lower, but the bullishness is around financial crisis levels. The survey includes a smattering of comments from participants. One of the more common that represents the bearish perspective looks at how much optimism there had been in the market prior to the May 2 highs. “Frankly, we have been stunned by the disconnect that we see between these optimistic calls over the past six to nine months and the reality of what is occurring in the global economy,” wrote Boston-based Hans P. Black in the Interinvest Review & Outlook. Conversely, misery is not universal, with Elliott F. Gue’s Personal Finance Newsletter making the case for the optimists that one should not “fall prey to the panic fanned by the usual fear-mongering doomsayers,” a group that presumably includes those unemployed or bewildered by inflation and, thus, in misery.
The Top and the Bottom
Survey: U.S. trails in equal legal treatment of citizens - McClatchy Newspapers - Daniel Lippman - June 13, 2011 - The U.S. lags behind western Europe in access to civil justice and legal assistance, according to an international survey released Monday that also raised questions over whether U.S. police forces treat all citizens equally... A fair legal system provides a critical backbone and infrastructure for countries - ensuring that they run effectively, citizens get a fair shake and companies can operate under predictable rules, the researchers said... While the U.S. scored high in many areas - including checks and balances in the legal system, civil liberties, freedom of expression and independence of the judiciary - it trailed western European countries in such areas as legal access for low-income communities and ethnic minorities and also scored low in perceptions of whether police treat people of different backgrounds equally. "In the United States, rich individuals take their disputes to courts, whereas poor and low-income individuals normally don't use the formal dispute resolution mechanisms. They simply either negotiate, do nothing or resort to violence in the worst-case scenario," said Juan Botero, the director of the index... The findings echoed experts who have said that the much-heralded Arab Spring protests this year were sparked in part by major shortcomings in the rule of law and mistreatment of ordinary citizens across the region. The protests started after an impoverished Tunisian street vendor lit himself on fire after an altercation with local police. "Widespread corruption which goes unpunished and the selective administration of justice is very much part of the sense of alienation and anger which people all across the region felt," said Marc Lynch, a professor of Middle East politics at George Washington University.
Recession… what recession? Pelosi's wealth grows by massive 62% (and Boehner and Cantor are also millionaires) - UK Daily Mail - Paul Bentley - June 16, 2011 - House Minority Leader Nancy Pelosi saw her wealth rise considerably last year, from just more than $20million to a huge $35.2million. Establishing Pelosi's place as one of the wealthiest lawmakers in the country, the sudden 62 per cent rise was revealed in the annual release of forms detailing the assets and liabilities of congressmen today. New House Speaker John Boehner also remained a multi-millionaire, with his wealth jumping from $1.8million in 2009 to $2.1million in 2010, and his deputy Eric Cantor reported even higher earnings.
Working America's Dismal State - Steve Lendman Blog - June 17, 2011 - From 2007 - 2009, private sector wages and salaries declined sharply, while unemployment, underemployment, and their median and mean durations skyrocketed... In fact, "(t)he tepid recovery from the 2007 - 09 recession through (Q I 2011) marks the first time in post-World War II history that civilian employment as measured by the" Current Population Survey (CPS) "failed to register any net growth seven quarters following the end of the recession." As a result, real unemployment as measured in the 1980s tops 22%, not the manipulated Bureau of Labor Statistics (BLS) 9.1% headline figure. Wages have also stagnated or declined, and benefits are eroding... From 2009 Q II through 2010, real US national income rose $528 billion. Pre-tax corporate profits alone increased $464 billion (88% of real national income) while aggregate real wages and salaries rose only $7 billion or 1%, despite double-digit inflation, not the manipulated BLS 3.6% CPI in the previous 12 months, excluding or underweighting food, energy, transportation, rent, college tuitions, and other sharply rising components... Since 1988, EPI published it annually, including data on household incomes, wages, jobs, unemployment, wealth, and poverty. Notably it said from 1948 - 1979, one third of average income growth went to America's 10% richest. However, from 1979 - 2007, the richest 10% got 91% of average income growth, an unprecedented disparity still widening as working households experience deepening hard times with no relief in sight because policy initiatives demand greater sacrifices when massive social spending is required to relieve need... Wealth destruction from 2007 - 2009, was disproportionately experienced by 80% of Americans. The average net worth of America's wealthiest 1% was 225 greater than the median 2009 household net worth - the highest ratio on record. In 2009, about 25% of US households had zero or negative net worth. For Black households, it was 40%. Their median net worth was $2,200, "the lowest ever recorded" compared to Whites at $97,900. In 2009, America's 20% richest controlled 87.2% of all wealth. The top 1% controlled 35.6%. In 2009 dollars, median household wealth fell from $71,900 in 1983 to $62,200 in 2009 while America's richest got richer. In 2009, the Forbes top 400 wealth averaged $3.2 billion - 523% higher than 1982. Their collective net worth was $1.3 trillion. Today it's greater... During the "Great Recession," 8.4 million jobs were lost, and long-term unemployment and underemployment registered record highs. Because of the deepening housing depression, home equity as a percent of property value fell from 59.5% in 2006 Q I to 36.2% in 2009 Q IV. "For the first time on record, the percent of home value (owned outright by homeowners) dropped below 50% - meaning that banks now own more of the nation's housing stock than people do." Moreover, one-fourth of mortgage holders are under water because of rising debt and plummeting prices. Homeowners' equity as a percent of home value fell from around 70% in the early 1970s to 36.2% in Q I 2009.
Gerald Celente - The Ponzi Scheme is Collapsing - June 17, 2011
Sunday, June 19, 2011
Saturday, June 18, 2011
Do people even know? Hickory Airport Operators (River Hawk Aviation) in Bankruptcy
River Hawk Aviation, the Fixed Based Operator at the Hickory Airport, has filed for Chapter 11 Bankruptcy as of May 19, 2011 in Western North Carolina (North Wilkesboro) Bankruptcy Court. The case is being administered by Judge J. Craig Whitley.
This bankruptcy also affects River Hawk's prior acquisition of Carolina Air Charter, which is addressed on the following web page River Hawk Aviation Acquires Carolina Air Charter, Inc. from March 19, 2008. This bankruptcy also affects Eagle Aviation, which is a FBO headquartered in West Columbia, South Carolina. Apparently River Hawk inherited a stakeholder position in Eagle Aviation through its acquisition of Profile Aviation on August 28, 2007. Profile Aviation was the former FBO at the Hickory Regional Airport.
In a Reuters article dated November 27, 2008 entitled Richard Girouard Joins River Hawk Board , Management forecasted revenues from the Company's existing operating subsidiaries to be approximately $14-$15 million for the upcoming twelve months ending September 2008. Apparently this was a rosy scenario projection when one looks at what has happened over the subsequent 3 1/2 years.
The Hound has detailed the problems associated with the former and current Fixed Based Operators and the subsequent problems partially inherited and otherwise mismanaged by all parties associated with the Hickory Regional Airport. These parties include Hickory City Elected Officials and Administration who have failed to take the bull by the horns and have allowed this problem to fester since at least 2007 and the former and current operators of the airport who have apparently not been working in good faith with City Officials since River Hawk acquired Profile in 2007. The City didn't have a clue of what was happening during that acquisition and in the subsequent time period River Hawk has struggled to meet its financial obligations including those to the City. The City has known the issues and failed to act prior to and since I wrote the following on September 30, 2009 - Mind Blowing - The City's Mismanagement of the Hickory Regional Airport.
During the past two years we have seen more information come to light that shows that River Hawk wasn't going to succeed at the Hickory Airport, but for some reason the City has decided to sit on its hands and let the situation continue to deteriorate. I think it is time that the City answer questions from outside of their constant closed sessions. I don't think those closed sessions meetings related to this issue have occurred except as a method to save face. I think everyone who is honest with themselves has to believe that the deteriorating situation at the airport is an embarrassment.
The lack of a viable airport hurts the economic prospects of Hickory! The lack of a viable airport hurts the the tax base in Hickory! The lack of a viable airport hurts existing and prospective business generation in Hickory!
I would like to ask if our City Officials would operate in the same fashion they have in this situation if they had leased out one of their personal properties for someone else to operate in the same manner that our local airport has been operated in the past several years. I personally don't think they would have tolerated it. Yet, what we see here is a situation very similar to what people gripe about when it comes to higher level politics and governance. If River Hawk would have succeeded, then their profits would have gone to Wall Street investors, but since they have failed our community is the one who has taken the hit. Aviators know of the mismanagement of the Hickory Airport and they have been bypassing it for the last several years. While other airports in the area (Statesville and Lincolnton) have been growing, our airport is dead. Our airport used to be a viable hub for Piedmont Airlines and now there is hardly any activity at all.
We have seen the loss of the viability of our airport become a huge social loss for the community and our City leaders don't seem to care. What we see here is that profits would have been privatized and benefited private parties, such as the current owners of River Hawk (and the former FBO administrator who is now a stakeholder in River Hawk), and the loss has been socialized; because the years that have gone by will probably mean that the Hickory Airport will never be able to recover and will most likely never be a viable Center of Aviation again.
We have seen this same scenario countless times involving multiple issues over the last several years. Where is the accountability? Wake up or kiss it all goodbye!!!
U.S. Bankruptcy CourtWestern District of North Carolina (Wilkesboro)Bankruptcy Petition #: 11-50641 | |
River Hawk Aviation, Inc. |
In a Reuters article dated November 27, 2008 entitled Richard Girouard Joins River Hawk Board , Management forecasted revenues from the Company's existing operating subsidiaries to be approximately $14-$15 million for the upcoming twelve months ending September 2008. Apparently this was a rosy scenario projection when one looks at what has happened over the subsequent 3 1/2 years.
The Hound has detailed the problems associated with the former and current Fixed Based Operators and the subsequent problems partially inherited and otherwise mismanaged by all parties associated with the Hickory Regional Airport. These parties include Hickory City Elected Officials and Administration who have failed to take the bull by the horns and have allowed this problem to fester since at least 2007 and the former and current operators of the airport who have apparently not been working in good faith with City Officials since River Hawk acquired Profile in 2007. The City didn't have a clue of what was happening during that acquisition and in the subsequent time period River Hawk has struggled to meet its financial obligations including those to the City. The City has known the issues and failed to act prior to and since I wrote the following on September 30, 2009 - Mind Blowing - The City's Mismanagement of the Hickory Regional Airport.
During the past two years we have seen more information come to light that shows that River Hawk wasn't going to succeed at the Hickory Airport, but for some reason the City has decided to sit on its hands and let the situation continue to deteriorate. I think it is time that the City answer questions from outside of their constant closed sessions. I don't think those closed sessions meetings related to this issue have occurred except as a method to save face. I think everyone who is honest with themselves has to believe that the deteriorating situation at the airport is an embarrassment.
The lack of a viable airport hurts the economic prospects of Hickory! The lack of a viable airport hurts the the tax base in Hickory! The lack of a viable airport hurts existing and prospective business generation in Hickory!
I would like to ask if our City Officials would operate in the same fashion they have in this situation if they had leased out one of their personal properties for someone else to operate in the same manner that our local airport has been operated in the past several years. I personally don't think they would have tolerated it. Yet, what we see here is a situation very similar to what people gripe about when it comes to higher level politics and governance. If River Hawk would have succeeded, then their profits would have gone to Wall Street investors, but since they have failed our community is the one who has taken the hit. Aviators know of the mismanagement of the Hickory Airport and they have been bypassing it for the last several years. While other airports in the area (Statesville and Lincolnton) have been growing, our airport is dead. Our airport used to be a viable hub for Piedmont Airlines and now there is hardly any activity at all.
We have seen the loss of the viability of our airport become a huge social loss for the community and our City leaders don't seem to care. What we see here is that profits would have been privatized and benefited private parties, such as the current owners of River Hawk (and the former FBO administrator who is now a stakeholder in River Hawk), and the loss has been socialized; because the years that have gone by will probably mean that the Hickory Airport will never be able to recover and will most likely never be a viable Center of Aviation again.
We have seen this same scenario countless times involving multiple issues over the last several years. Where is the accountability? Wake up or kiss it all goodbye!!!
Thursday, June 16, 2011
Are You Ready? -- Gerald Celente
| If you are having trouble reading this email, you may view the online version |
 |
COLLAPSE: IT’S COMING! ARE YOU READY? KINGSTON, NY, 13 June 2011— Everything is not all right. And things are going to get worse … much worse. The economy is on the threshold of calamity. Wars are spreading like wildfires. The world is on a razor’s edge. Not so, say world leaders and mainstream media experts. Yes, there are problems, but the financiers and politicians are aware of them. Policies are already in place and measures are being taken to correct them. Whether it’s failing economies, intractable old wars or raging new wars, the word from the top always maintains that steady progress is being made and comforts the populace with assurances that the brightest minds and the sharpest generals are in charge and on the case. On all fronts, success is certain and victory is at hand. Only “patience” is required … along with more men, more time and more money. As far as these “leaders” and their media are concerned, the only opinions that count come from a stable of thoroughbred experts, official sources and political favorites. Only they have the credentials to speak with authority and provide trustworthy forecasts. That they are consistently, if not invariably, wrong apparently does nothing to diminish their credibility. How can any thinking adult possibly imagine that the same central bankers, financiers and politicians responsible for creating the economic crisis are capable of resolving it? Within days of its announcement, we predicted that Bush’s TARP (Troubled Asset Relief Program) was destined to fail, and subsequently predicted the same for Obama’s stimulus package (The American Recovery and Reinvestment Act). They were no more than cover-ups; there would be no recovery. Meet the New Plan, Same as the Old Plan Democrat or Republican, it makes no difference. Despite the heated rhetoric, solving economic problems had less to do with the party in power and more to do with professional competence. Both sides had their turn in office. Both used their power to initiate policies that created the problems. Both sides had their shot at fixing the messes they were responsible for. Both sides failed, as we predicted. Given who they are and what they’ve done, we confidently predict an unbroken sequence of bipartisan failures in the future. The Beltway Incompetents are in the driver’s seat. What person with a healthy instinct for self-preservation would believe the promises of politicians or trust the judgment of central bankers or Wall Street financiers whose only real interest is self interest? Not “Business as Usual” In the 1920s, US President Calvin Coolidge declared, “The business of America is business.” Four score and 10 years later, the business of America has become war: The forty-year War on Drugs; The ten-year War on Terror; the Afghan War (longest in American history); the eight-years-and-no-end-in-sight Iraq War; the covert wars in Pakistan and Yemen; and most recently, the “time-limited, scope-limited kinetic military action” in Libya. While the justifications for engaging in these wars were all different, all were murderous, immoral, interminable, ruinously expensive and abject failures. Why would anyone believe the optimistic battle communiqués issued by the “czars” in charge and the battlefield brass who keep reassuring the public that reapplying previously failed strategies would, this time, lead to success? Yet even in the face of their proven failures and gross incompetence, anyone daring to challenge the party line or the conventional wisdom is dismissed as an “alarmist,” “fear monger,” or “gloom-and-doomer.” However unwelcome our forecasts may be – pessimism, optimism, like or dislike are all irrelevant – only their accuracy counts. We correctly forecast:
We also said that the Federal Reserve’s sighting of economic “green shoots” in March 2009 was a "mirage” and predicted that their much vaunted “recovery” was no more than a temporary solution, a quick-fix to be followed by “The Greatest Depression.” And now, in June 2011, with the Dow on a down trend and the economic data increasingly pointing in the direction of Depression, Washington and Wall Street remain in denial. The only debate among the “experts” is whether or not a “double dip” recession is likely. However, for the man on the street – pummeled by falling wages, higher prices, intractable unemployment, rising taxes and punitive “austerity measures” – “Depression,” not “recession,” and certainly not “prosperity,” is just around the corner. According to a June 8th CNN/Opinion Research Corporation poll, 48 percent of Americans believe that another Great Depression is likely to occur in the next year – the highest that figure has ever reached. The survey also indicates that just under half of the respondents live in a household where someone has lost a job or is worried that unemployment may hit them in the near future. Suddenly, after years of obvious economic hardship experienced by tens of millions of Americans – only when the suffering and pain can no longer be cloaked in abstractions and cooked statistics – does an emboldened media dare utter the forbidden “D” word. For Trends Journal readers, alerted to this emerging trend some three years ago, the prospect of Depression should come as no surprise. Neither should the idea that, when it hits and can no longer be denied, a long suffering public will take to the streets. When I made this forecast back then it was written off by most of the major broadcast and print media. Now, however, when one of their own, belatedly and hesitantly, raises that possibility he is elevated to sage status and it becomes big news. In early June, Democratic strategist James “It’s the Economy, Stupid” Carville, having finally mastered the higher math of adding two plus two, warned that decaying economic conditions heightened the risk of civil unrest. As I described it all those years ago: “When people lose everything, and have nothing left to lose, they lose it.” Trend Forecast: The wars will proliferate and civil unrest will intensify. As we forecast, the youth-inspired revolts that first erupted in North Africa and the Middle East are now breaking out in Europe (See “Off With Their Heads,” Trends Journal, Autumn 2010) Given the trends in play and the people in power, economic collapse at some level is inevitable. Governments and central banks will be unrelenting in their determination to wring every last dollar, pound or euro from the people through taxes while confiscating public assets (a.k.a. privatization) in order to cover bad bets made by banks and financiers. When the people have been bled dry financially and have nothing left to give, blood will flow on the streets. Trend Lesson: Learn from history. Do you remember when it first became apparent that the US economy was in deep trouble and heading toward the “Panic of 08”? Not many will. Most people were in a summer state of mind and in holiday mode. It was late July 2007 when the stock market suddenly plunged from its euphoric 14,000 high. Though we had warned in our Summer 2007 Trends Journal (released that June) that “trends indicators point to a major crisis hitting the financial markets between July and November,” the diving Dow was downplayed as a mere “hiccup” … a time to pause between more mouthfuls of expansion. Biggest mistake in a falling stock market The huge swings in the Dow are giving investors pause. But taking your money out of the market now could be the gravest mistake of all. NEW YORK — This past Thursday was the second worst day of the year for the Dow Jones Industrial Average. But remember, it was just a week ago today that the Dow closed above 14,000 for the first (and only) time. Fluctuations in the market shouldn't get to the 401(k) investor. Keep in mind your time horizon - most of us are going to be invested in the market until we retire, often decades from now. CNN 27 July 2007 Four years and trillions of dollars in stock and 401(k) losses later, that typical “take a deep breath, stay the course” advice looks tragically misguided. The Dow would eventually lose more than half its value and now, in June 2011, it’s fallen below 12,000. The moral of this story is to not let your mind take a summer vacation. Conditions are rapidly deteriorating and it is imperative to remain on high alert. Another violent financial episode is looming. It may be triggered by economics (e.g., debt defaults and debt crisis contagion in Europe, a crashing US dollar, or commodity price spikes); it could be terror (false flag or real), a man-made disaster (another Fukushima) or one made by Mother Nature … or any combination of the above. Publisher’s Note: To excel in any field – from gourmet chef to concert pianist to close-combat warrior – you have to practice … endlessly, over and over, until finally the training sinks in and becomes a part of you. In that spirit, I again repeat: preparing for financial survival is a “practice.” And it has to be treated as if you are preparing for battle; expect the unexpected and prepare for the worst, which in these perilous times could be a declaration of economic martial law. Banks may close, currencies may be devalued and deposit withdrawals may be imposed. Remember Gerald Celente’s basic survival strategy, “GC’s Three G’s: Guns, Gold and a Getaway plan.” In the Summer 2011 Trends Journal (mid-July release) we will provide practical strategies to cope with the coming collapse and offer approaches that, if implemented, could reverse the prevailing negative trends. |
| ©MMXI The Trends Research Institute® |
Wednesday, June 15, 2011
Working on a Report about Saturday's meeting of Citizens for Equity in Government
I attended this past Saturday's meeting that only had about 13 attendees. The meeting conflicted with a lot of other happenings around the area. The League of Women's Voters had another meeting going on, there we graduations, and others were on vacation. The hope is that the next meeting in July will have more attendees and by all accounts I believe that it will.
A lot of what was spoken about was about the separation between our local government/governance and the average folks in Hickory. I will get into more of the specifics in a more detailed report over the next few days.
What has me anxious is to see what is going on and how it related to the dysfunction of Government at all levels. These are frightening times in many respects, because we see trouble on social and economic levels. And this effects the people of the lower socio-economic strata more than anyone, because those at the upper levels of the pyramid push their problems down the line. We are living in a Ponzi Scheme Economy. I think most people realize that, but they are satisfied to live this moment in denial under a belief that if they ignore the problems we face that they will just go away.
Our local government and political philosophy operates under a notion that if we save all of our dollars during these rainy days that eventually when the sun shines we are going to float to the top of the heap. The question begs to be asked, "When has this ever happened during the history of civilization?"
When a collapse happens, the whole system goes down. There will be no prisoners taken -- so to say. When the United States Federal Reserve Note System Collapses, we are still going to have to deal with the aftermath of that destruction just like all of the other communities in our country. Fiat Monetary Systems always collapse. It isn't a matter of if. It is a matter of when.
The understanding we must have is that our Social System will only survive the collapse of our currency if we realize that people matter more than money. As I have pointed to you many times on this blog, when the currency collapses there will still be ways to create a marketplace through bartering or alternative currencies. The problems we will see will be because of the transition from what the accepted currency currently is to what it shall be after the collapse of the Federal Reserve Note System.
One of the issues that we discussed the other day was the way that groups of people are constantly pitted against one another. It is the all too well known method called Divide and Conquer. This shouldn't be about color, gender, religious preference, or whatever. This hurts the people at the Lower Economic Strata most of all, because they are the most vulnerable to instability of the economy and the society in general. They have no gated community to hide behind when it hits the fan. They can't afford extra security when there is a riot.
In the times we are living in, we cannot afford to allow ourselves to be divided. Unfortunately, during a Disaster or Collapse that is when riots and chaos will occur, because of the way that groups are pitted against one another. Most of this is created by ignorance and lack of understanding, empathy, and compassion for others who don't fit what someone considers their norm. We can't afford to associate with Modern Professional Wrestling Politics. We can't afford to buy into talking points, obfuscation, and soundbytes.
We need to get on to the road to recovery. We need to start working together to build something, instead of constantly creating obstacles and being destructive. I think that was the mood of the discussion from last Saturday's meeting. I hope people of all backgrounds will join us on this mission to bring Government back to the people of the area. That idea has no party affiliation, color, or creed. That idea is about fairness, justice, and being a good human being.
Peace
A lot of what was spoken about was about the separation between our local government/governance and the average folks in Hickory. I will get into more of the specifics in a more detailed report over the next few days.
What has me anxious is to see what is going on and how it related to the dysfunction of Government at all levels. These are frightening times in many respects, because we see trouble on social and economic levels. And this effects the people of the lower socio-economic strata more than anyone, because those at the upper levels of the pyramid push their problems down the line. We are living in a Ponzi Scheme Economy. I think most people realize that, but they are satisfied to live this moment in denial under a belief that if they ignore the problems we face that they will just go away.
Our local government and political philosophy operates under a notion that if we save all of our dollars during these rainy days that eventually when the sun shines we are going to float to the top of the heap. The question begs to be asked, "When has this ever happened during the history of civilization?"
When a collapse happens, the whole system goes down. There will be no prisoners taken -- so to say. When the United States Federal Reserve Note System Collapses, we are still going to have to deal with the aftermath of that destruction just like all of the other communities in our country. Fiat Monetary Systems always collapse. It isn't a matter of if. It is a matter of when.
The understanding we must have is that our Social System will only survive the collapse of our currency if we realize that people matter more than money. As I have pointed to you many times on this blog, when the currency collapses there will still be ways to create a marketplace through bartering or alternative currencies. The problems we will see will be because of the transition from what the accepted currency currently is to what it shall be after the collapse of the Federal Reserve Note System.
One of the issues that we discussed the other day was the way that groups of people are constantly pitted against one another. It is the all too well known method called Divide and Conquer. This shouldn't be about color, gender, religious preference, or whatever. This hurts the people at the Lower Economic Strata most of all, because they are the most vulnerable to instability of the economy and the society in general. They have no gated community to hide behind when it hits the fan. They can't afford extra security when there is a riot.
In the times we are living in, we cannot afford to allow ourselves to be divided. Unfortunately, during a Disaster or Collapse that is when riots and chaos will occur, because of the way that groups are pitted against one another. Most of this is created by ignorance and lack of understanding, empathy, and compassion for others who don't fit what someone considers their norm. We can't afford to associate with Modern Professional Wrestling Politics. We can't afford to buy into talking points, obfuscation, and soundbytes.
We need to get on to the road to recovery. We need to start working together to build something, instead of constantly creating obstacles and being destructive. I think that was the mood of the discussion from last Saturday's meeting. I hope people of all backgrounds will join us on this mission to bring Government back to the people of the area. That idea has no party affiliation, color, or creed. That idea is about fairness, justice, and being a good human being.
Peace
Sunday, June 12, 2011
Economic Stories of Relevance in Today's World -- June 12, 2011
Questions surround feds' raid of Stockton home - KXTV Sacramento - June 8, 2011 - A federal education official Wednesday morning offered little information as to why federal agents raided a Stockton man's home Tuesday... U.S. Department of Education spokesman Justin Hamilton confirmed for News10 Wednesday morning federal agents with the Office of the Inspector General (OIG), not local S.W.A.T., served the search warrant. Hamilton would not say specifically why the raid took place except that it was part of an ongoing criminal investigation... (Hound - This is a story about unreasonable search and seizure over a student loan).
Bill Gross: Treasury investors will 'get cooked' - CNN Money - By Hibah Yousuf - June 8, 2011 - Investors who have been betting on Treasuries are destined "to get cooked like frogs in an increasingly hot pot of water," the well-known bond bear told attendees at a Morningstar Investment conference in Chicago... Gross, who manages the $235 billion Pimco Total Return Fund (PTTAX), said real interest rates, which remove the effect of inflation to measure the actual yield an investor receives, have fallen into negative territory... He pointed out that Treasury inflation-protected securities with a maturity of 5 years are trading at a yield of -0.5%. In October 2008, the 5-year TIPS' real interest rate stood at 4%... Given the "staggering" drop in yields and the fact that, on a historical basis, they are low, Gross said interest rates can't sink much further "absent a potential crisis in the dollar."
The Situation Room: Corporations paying no federal income tax - CNN - Jack Cafferty - April 21, 2010 - GE and Bank of America pay no taxes... (Video)
The Federal Reserve Cartel: Freemasons and The House of Rothschild - Global Research - by Dean Henderson - (Part 2 of 4) - In 1789 Alexander Hamilton became the first Treasury Secretary of the United States. Hamilton was one of many Founding Fathers who were Freemasons. He had close relations with the Rothschild family which owns the Bank of England and leads the European Freemason movement. George Washington, Benjamin Franklin, John Jay, Ethan Allen, Samuel Adams, Patrick Henry, John Brown and Roger Sherman were all Masons... Roger Livingston helped Sherman and Franklin write the Declaration of Independence. He gave George Washington his oaths of office while he was Grand Master of the New York Grand Lodge of Freemasons. Washington himself was Grand Master of the Virginia Lodge. Of the General Officers in the Revolutionary Army, thirty-three were Masons. This was highly symbolic since 33rd Degree Masons become Illuminated. [1]... Populist founding fathers led by John Adams, Thomas Jefferson, James Madison and Thomas Paine- none of whom were Masons- wanted to completely severe ties with the British Crown, but were overruled by the Masonic faction led by Washington, Hamilton and Grand Master of the St. Andrews Lodge in Boston General Joseph Warren, who wanted to “defy Parliament but remain loyal to the Crown”. St. Andrews Lodge was the hub of New World Masonry and began issuing Knights Templar Degrees in 1769. [2]
Ron Paul tells Manchester crowd inflation will hit 50 percent - New Hampshire Union Leader - Mark Hayward - June 11, 2011 - Texas congressman Ron Paul on Friday predicted that inflation will hit 50 percent in the next couple of years, thanks to the massive debt the country has accumulated... Social Security checks will still be cut and interest payments will still be made, but the inflated dollars will allow the government to repay borrowed dollars with devalued money, Paul said.
Many of us won’t be able to retire until our 80s - Marketwatch - By Robert Powell - June 9, 2011 - What’s more, it’s even worse for low-income workers, according Jack VanDerhei, one of the co-authors of the study. Those who earned (on average over the course of their careers) less than $11,700 per year, the lowest income quartile, would need to defer retirement till age 84 before 90% of those households would have just a 50% chance of affording retirement... Those who earned between $11,700 and $31,200 will need to work till age 76 to have a 50% chance of covering basic expenses in retirement. Those who earned between $31,200 and $72,500 will need to work to age 72 to have a 50% chance and those who earned more than $72,500, those in the highest income quartile, catch a break; they get stop working at age 65 to have a 50/50 chance of funding their retirement.
China ratings house says US defaulting: report - AFP - June 10, 2011 - A Chinese ratings house has accused the United States of defaulting on its massive debt, state media said Friday, a day after Beijing urged Washington to put its fiscal house in order... "In our opinion, the United States has already been defaulting," Guan Jianzhong, president of Dagong Global Credit Rating Co. Ltd., the only Chinese agency that gives sovereign ratings, was quoted by the Global Times saying... Washington had already defaulted on its loans by allowing the dollar to weaken against other currencies -- eroding the wealth of creditors including China, Guan said.
US Is Nearing Even Worse Financial Crisis: Jim Rogers - CNBC - Margo D. Beller - June 8, 2011 - The U.S. is approaching a financial crisis worse than 2008, Jim Rogers, chief executive, Rogers Holdings, warned CNBC Wednesday... "The debts that are in this country are skyrocketing," he said. "In the last three years the government has spent staggering amounts of money and the Federal Reserve is taking on staggering amounts of debt... "When the problems arise next time…what are they going to do? They can’t quadruple the debt again. They cannot print that much more money. It’s gonna be worse the next time around."... The well-known investor believes the government won't shut down in August if agreement isn't reached on raising the debt ceiling, but he did say "draconian cuts" are needed in taxes and spending, especially military spending.
GM's Akerson pushing for higher gas taxes - The Detroit News - David Shepardson and Christina Rogers - June 7, 2011 - General Motors Co. CEO Dan Akerson wants the federal gas tax boosted as much as $1 a gallon to nudge consumers toward more fuel-efficient cars, and he's confident the government will soon shed its remaining 26 percent stake in the once-bankrupt automaker.... For the years 2017-25, federal officials are considering 3 percent to 6 percent annual fuel efficiency increases, or 47 mpg to 62 mpg. That could boost the cost of vehicles by up to $3,500... "You know what I'd rather have them do — this will make my Republican friends puke — as gas is going to go down here now, we ought to just slap a 50-cent or a dollar tax on a gallon of gas," Akerson said... "People will start buying more Cruzes and they will start buying less Suburbans."
Bill Gross: Treasury investors will 'get cooked' - CNN Money - By Hibah Yousuf - June 8, 2011 - Investors who have been betting on Treasuries are destined "to get cooked like frogs in an increasingly hot pot of water," the well-known bond bear told attendees at a Morningstar Investment conference in Chicago... Gross, who manages the $235 billion Pimco Total Return Fund (PTTAX), said real interest rates, which remove the effect of inflation to measure the actual yield an investor receives, have fallen into negative territory... He pointed out that Treasury inflation-protected securities with a maturity of 5 years are trading at a yield of -0.5%. In October 2008, the 5-year TIPS' real interest rate stood at 4%... Given the "staggering" drop in yields and the fact that, on a historical basis, they are low, Gross said interest rates can't sink much further "absent a potential crisis in the dollar."
The Situation Room: Corporations paying no federal income tax - CNN - Jack Cafferty - April 21, 2010 - GE and Bank of America pay no taxes... (Video)
The Federal Reserve Cartel: Freemasons and The House of Rothschild - Global Research - by Dean Henderson - (Part 2 of 4) - In 1789 Alexander Hamilton became the first Treasury Secretary of the United States. Hamilton was one of many Founding Fathers who were Freemasons. He had close relations with the Rothschild family which owns the Bank of England and leads the European Freemason movement. George Washington, Benjamin Franklin, John Jay, Ethan Allen, Samuel Adams, Patrick Henry, John Brown and Roger Sherman were all Masons... Roger Livingston helped Sherman and Franklin write the Declaration of Independence. He gave George Washington his oaths of office while he was Grand Master of the New York Grand Lodge of Freemasons. Washington himself was Grand Master of the Virginia Lodge. Of the General Officers in the Revolutionary Army, thirty-three were Masons. This was highly symbolic since 33rd Degree Masons become Illuminated. [1]... Populist founding fathers led by John Adams, Thomas Jefferson, James Madison and Thomas Paine- none of whom were Masons- wanted to completely severe ties with the British Crown, but were overruled by the Masonic faction led by Washington, Hamilton and Grand Master of the St. Andrews Lodge in Boston General Joseph Warren, who wanted to “defy Parliament but remain loyal to the Crown”. St. Andrews Lodge was the hub of New World Masonry and began issuing Knights Templar Degrees in 1769. [2]
Ron Paul tells Manchester crowd inflation will hit 50 percent - New Hampshire Union Leader - Mark Hayward - June 11, 2011 - Texas congressman Ron Paul on Friday predicted that inflation will hit 50 percent in the next couple of years, thanks to the massive debt the country has accumulated... Social Security checks will still be cut and interest payments will still be made, but the inflated dollars will allow the government to repay borrowed dollars with devalued money, Paul said.
Many of us won’t be able to retire until our 80s - Marketwatch - By Robert Powell - June 9, 2011 - What’s more, it’s even worse for low-income workers, according Jack VanDerhei, one of the co-authors of the study. Those who earned (on average over the course of their careers) less than $11,700 per year, the lowest income quartile, would need to defer retirement till age 84 before 90% of those households would have just a 50% chance of affording retirement... Those who earned between $11,700 and $31,200 will need to work till age 76 to have a 50% chance of covering basic expenses in retirement. Those who earned between $31,200 and $72,500 will need to work to age 72 to have a 50% chance and those who earned more than $72,500, those in the highest income quartile, catch a break; they get stop working at age 65 to have a 50/50 chance of funding their retirement.
China ratings house says US defaulting: report - AFP - June 10, 2011 - A Chinese ratings house has accused the United States of defaulting on its massive debt, state media said Friday, a day after Beijing urged Washington to put its fiscal house in order... "In our opinion, the United States has already been defaulting," Guan Jianzhong, president of Dagong Global Credit Rating Co. Ltd., the only Chinese agency that gives sovereign ratings, was quoted by the Global Times saying... Washington had already defaulted on its loans by allowing the dollar to weaken against other currencies -- eroding the wealth of creditors including China, Guan said.
US Is Nearing Even Worse Financial Crisis: Jim Rogers - CNBC - Margo D. Beller - June 8, 2011 - The U.S. is approaching a financial crisis worse than 2008, Jim Rogers, chief executive, Rogers Holdings, warned CNBC Wednesday... "The debts that are in this country are skyrocketing," he said. "In the last three years the government has spent staggering amounts of money and the Federal Reserve is taking on staggering amounts of debt... "When the problems arise next time…what are they going to do? They can’t quadruple the debt again. They cannot print that much more money. It’s gonna be worse the next time around."... The well-known investor believes the government won't shut down in August if agreement isn't reached on raising the debt ceiling, but he did say "draconian cuts" are needed in taxes and spending, especially military spending.
GM's Akerson pushing for higher gas taxes - The Detroit News - David Shepardson and Christina Rogers - June 7, 2011 - General Motors Co. CEO Dan Akerson wants the federal gas tax boosted as much as $1 a gallon to nudge consumers toward more fuel-efficient cars, and he's confident the government will soon shed its remaining 26 percent stake in the once-bankrupt automaker.... For the years 2017-25, federal officials are considering 3 percent to 6 percent annual fuel efficiency increases, or 47 mpg to 62 mpg. That could boost the cost of vehicles by up to $3,500... "You know what I'd rather have them do — this will make my Republican friends puke — as gas is going to go down here now, we ought to just slap a 50-cent or a dollar tax on a gallon of gas," Akerson said... "People will start buying more Cruzes and they will start buying less Suburbans."
Peter Schiff interviewed by Max Keiser
Subscribe to:
Posts (Atom)