Only 11 states depended on the federal government for more than one-third of their total revenues in 2001. By 2012, 24 states found themselves in this situation.
State-by-state data from the U.S. Census Bureau, compiled by the State Budget Solutions nonprofit, illustrates the trend of increasing state dependence on federal financial assistance.
Forty-one of the 50 states have become more dependent on the federal government since 2001 — with federal dollars accounting for an increasing share of their total revenues.
This trend of increased state dependency on Washington reduces state and local control, while threatening the states’ long-run autonomy.
The reason is that with federal patronage comes federal leverage. The original Obamacare plan, for example, was to force states to expand Medicaid by threatening them with loss of all federal matching Medicaid funds if they refused.
Although that particular scheme was struck down by the Supreme Court, state governments hate to turn down revenue, and federal dollars have strings attached that force states either to operate as Washington prefers or lose the money.
This problem is exacerbated by the federal government’s control of the currency and ability to borrow virtually unlimited amounts of money.
April 10, 2014
The Kremlin said on April 10 that Putin told the European leaders that the “critical situation” over Ukraine’s debt could impact the transit of Russian gas to much of Europe.
He wrote that the state-controlled energy giant Gazprom would be “compelled to switch over to advance payment for gas deliveries” for Ukraine and that if Ukraine remains unable to settle its debt, Gazprom “will completely or partially cease gas deliveries.”
Putin raised concerns about Ukraine siphoning off gas from pipelines leading to Europe and said Ukraine needed some 11.5 billion cubic meters of gas, worth some $5.5 billion, to fill the country’s underground storage tanks.
Putin also wrote Russia is prepared to take part, along with the European Union, in efforts to restore Ukraine’s economy.
MOSCOW. — Russia does not recognise the legitimacy of Ukraine’s new authorities, but continues its economic assistance to its crisis-hit neighbour, a situation that will not last forever, Russian president Vladimir Putin said yesterday.
“As you know, our partners in Europe recognise the legitimacy of the current Kiev authorities, but are doing nothing in order to support Ukraine; not a single dollar, not a single euro,” Putin said.
“The Russian Federation doesn’t recognise the legitimacy of the authorities in Kiev, but will continue to give it economic support and subsidise Ukraine’s economy with hundreds of millions and billions of dollars for now.
“This situation, of course, can’t continue eternally,” the Russian leader added.
He demanded that Russia remain disciplined and fulfil all contract obligations with Ukraine, but added that the country must be prepared to replace Ukrainian goods and correct state defence orders.
“I ask you to be disciplined and fulfil all contract obligations with our Ukrainian partners, but we need to be prepared for any development in the situation . . . including import replacements,” Putin said during a meeting of senior officials.
Little expected from Ukraine talks
Updated: 04:53, Thursday April 10, 2014
The US says it is going into an upcoming meeting with Russia, Europe and Ukraine on the crisis in the former Soviet republic with low expectations.
‘I have to say that we don’t have high expectations for these talks, but we do believe it is very important to keep that diplomatic door open and will see what they bring,’ Victoria Nuland, assistant secretary of state for European affairs, said on Wednesday.
US and EU diplomats have agreed with Russia to hold four-way negotiations involving Ukraine next week to de-escalate the worst European security crisis in decades.
An EU diplomat said the talks would likely be held on April 17 in Vienna.
In signs that Russia will continue its pressure on the Ukraine, President Vladimir Putin has warned the country may begin requiring advance payment for gas supplies unless Ukraine comes to the negotiating table over its unpaid energy bills.
So far, the West’s reaction to Russia’s annexation of Crimea has been rather chivalrous. Freeze a few assets here, travel restrictions for a dozen people there, and of course have Visa and MasterCard stop providing services for a few Russian banks.
Putin then said Russia will explore launching its own credit cards, similar to Japan’s JCB and China’s UnionPay. Nice try. While these two companies have pretty good traction in their home market, they are dwarfed by American plastic.
According to research by Nilson, MasterCard processed more than $8 trillion of the world’s credit card transactions in 2011. Visa came second at around $3 trillion and UnionPay third with a little more than $2 trillion. The reason: MasterCard and Visa are accepted everywhere in the world, where the other two are pretty much local only.
Either way, banning a few Russian banks from processing Visa or Master for a while or Russia launching its own alternatives won’t change a lot in the grand scheme of things. However, the direction where this conflict is going is interesting.
The Nuclear Option
International payments between banks are processed via the Society for Worldwide Interbank Financial Telecommunication (SWIFT), a little known member-owned cooperative based in Belgium.
If you have ever sent an international wire transfer, you will likely have entered a so-called Business Identifier Code, or BIC in short. It is part of SWIFT’s system for processing payments.
NZ signs historic currency deal with China.
By Adam Bennett
Photo / New Zealand Herald
New Zealand’s economic ties with China have been strengthened with a deal to allow direct trading of the New Zealand dollar against the Chinese currency the renminbi or yuan.
The deal, struck relatively swiftly negotiations began in April last year, will reduce costs for exporters and importers by removing the necessity for transactions to be settled in two foreign exchange trades via a third currency – usually the US dollar.
Prime Minister John Key and China’s Premier Li Keqiang announced the agreement after meeting at the Great Hall of the People during Key’s first day of an official visit to China this evening.
“It’s great to have been in Beijing to witness the conclusion of negotiations to launch direct trading of the New Zealand and Chinese currencies, which I kicked off during talks with President Xi on the margins of the Bo’ao Forum in April 2013″, Key said.
“I am delighted that the project has been brought to a successful conclusion so quickly.
It highlights the strong relationship and goodwill between New Zealand and China.”
Key said the agreement “will make doing business with China easier by reducing the costs of converting between the two currencies, and will stimulate trade and investment”.
“Direct trading will also increase the integration between the New Zealand and Chinese financial systems, and deepen the economic relationship between the two countries.”
Courtesy of silverdoctors.com
A few weeks ago, evidence was discovered that Saudi Arabia’s gold holdings in London were being stolen by central banks in the West and re-hypothicated without the Arab kingdom’s permission. However, this confiscation doesn’t appear to be only theft in play as just weeks after the Western led coup helped overthrow the rightfully elected Ukrainian leader, rumors are coming out of Kiev on March 10 that show planes being loaded with what is believed to be Ukrainian gold, and flown back to either the U.S. or London for an unknown purpose.
As our site workers airport “Borispol”, this night in 2-00, with the designated airport runway started unregistered transport plane … According to the staff “Boryspil”, before it came to the airport four collector car and two cargo minibus Volkswagen, while , all arriving truck license plate missing. Car pulled out of about fifteen people in black uniforms, masks and body armor. Some of them were armed with machine guns. These people have downloaded the plane more than forty heavy boxes … After that, some mysterious men arrived too entered the plane.
Later, in Received call back one of the senior officials of the former Ministry of income and fees, which reported that, according to him, tonight, on the orders of one of the “new leaders” of Ukraine in the United States has been taken all the gold reserves in Ukraine … – Zerohedge
Dr. Long Xinming — nsnbc April 18, 2013
The German government has been storing about half of its gold supply with the US FED, apparently in the NYC FED vaults. Germany decided to bring home all its gold, but the FED has said that isn’t possible to do, and it would need until 2020 to be able to accomplish the transfer.
The German government then asked to visit the FED vaults to inventory the gold and determine its actual existence, but the FED refused to permit Germany to examine its own gold. The reasons given were “security” and “no room for visitors”. And nothing else.
Germany did finally send some staff to the FED, and they were permitted only into the vault’s anteroom where they were shown 5 or 6 gold bars as representative of their holdings, and were permitted nothing else.
They apparently came a second time, and the FED did open only one of 9 rooms and let the Germans look at the stack of gold, but were not permitted to either enter or touch. And they returned home.
There has been speculation for a long time, that the FED doesn’t actually have much gold, that it has either sold it off, lent it out, or used it as collateral for borrowings. Either case, there are many claims that the gold that is being stored on behalf of many nations, doesn’t actually exist.
And nobody, other than FED staff, have actually been permitted inside the vaults to see or inventory any of the gold. There is no evidence that the gold actually exists, other than the word of the FED.
Even more, the situation is the same with the supposed gold depository at Fort Knox. Nobody has seen the gold there for a very long time.
The last audit, and the last public visit, was in 1953, just after U.S. President Dwight Eisenhower took office. No outside experts were allowed during that audit, and the audit team tested only about 5% of gold there. So, there hasn’t been a comprehensive audit of Fort Knox in over 60 years.
In 1974 six Congressmen, one Senator and the press were allowed to enter Fort Knox to see for themselves if the gold was there or not. The tour showed that there was gold in Fort Knox but, all the same, it sparked even more controversies.
Only a small fraction of the gold reserves were made available for viewing, and one Congressman published a report saying that the gold bars held in the fort may have been less heavy than would have been expected.
During the past two years, several US politicians have claimed that there is a high chance that neither Fort Knox nor the FED have any gold, or perhaps only a very small amount, and have demanded a full and public inventory and testing, but the FED have resolutely refused.
I have no idea what to make of this. There was another incident last year when Goldman Sachs were proven to have been selling gold certificates to the public, ostensibly backed by real gold in their vaults, but the story leaked out that they in fact held no gold at all, and were doing “fractional reserve” gold banking, on the basis that few people would want to claim their gold at any one time.
Even worse, Goldman were charging customers storage fees for the gold that didn’t exist. Also, do you recall the information I circulated around the middle of last year, documenting the immense gold theft the FED pulled on much of the world during WW II?
I stumbled onto this blog ( The Last Great Stand) today and found something that I felt I needed to share. There is so much information here. So much research and data has been compiled that I was compelled.
For those who are teetering on the fence……
It is time to open your eyes and see the possibilities of what our future could very well be.
Do we know for sure any of this will take place?
No one can be 100% sure.
Was anyone 100% sure that the Great Depression would take place?
I am betting that those who took their lives after the crash , never in their wildest dreams thought anything quite like that would take place. I am also willing to bet they would have laughed at anyone warning them of the impending doom about to descend on their prosperous lives.
Still feeling strong in your convictions of ridicule and conspiracy theory labeling?
How many listened when the financial trouble of 2008 was being discussed?
It hit most like a runaway train.
Question is ……has it rattled your sense of reality enough to bring you out of your little idyllic dream world?
If it has , then do not let the length nor the volume of information in these presentations deter you. Here you will find information you may already be aware of and items that had never even occurred to you. In either case it is well worth the time invested.
I hope you will give it a go , you have nothing to lose but a bit of time and so much to gain.
For those who are still poo pooing good luck to you . I sincerely wish you well.
MY PERSONAL PREDICTIONS IN DETAIL
JUST USING COMMON SENSE
(WITH A TOUCH FROM PARTS I-IX)
For anyone interested in learning just how screwed the U.S. is, I am doing what will end up being about 10 Part Series. Many people laugh when you mention the Dollar collapsing and Martial Law. I’m afraid it’s no laughing matter. I put these together to explain to the nay sayers as best I could:
- Part I: Saudi Arabia Acting Like an Anchor Weight Around the Petrodollar
- Part II: The Beginning of the End of the Petrodollar: And The United States
- Part III: Why Are We Letting China Buy American companies?
- Part IV: America, It’s Going to be US In the Nike Sweatshops Very Soon!
- Part V: The Coming Economic Enslavement of Communism
- Part VI: China Starts To Make A Power Move Against The U.S. Dollar
- Part VII: U.S. Stock Market Takes a Dive – Is The Bubble Beginning to Pop?
- Part VIII: 25 Fast Facts About The Federal Reserve – Please Share!
- Part IX: Explaining The Federal Reserve, Inflation, and the Economic Bubbles About To BURST In Layman’s Terms
Part I: Saudi Arabia Acting Like an Anchor Weight Around the Petrodollar…
The largest oil exporter in the Middle East has teamed up with the second largest consumer of oil in the world (China) to build a gigantic new oil refinery and the mainstream media in the United States has barely even noticed it. This mammoth new refinery is scheduled to be fully operational in the Red Sea port city of Yanbu by 2014. Over the past several years, China has sought to aggressively expand trade with Saudi Arabia, and China now actually imports more oil from Saudi Arabia than the United States does. In February, China imported 1.39 million barrels of oil per day from Saudi Arabia. That was 39 percent higher than last February. So why is this important? Well, back in 1973 the United States and Saudi Arabia agreed that all oil sold by Saudi Arabia would be denominated in U.S. dollars. This petrodollar system was adopted by almost the entire world and it has had great benefits for the U.S. economy. But if China becomes Saudi Arabia’s most important trading partner, then why should Saudi Arabia continue to only sell oil in U.S. dollars? And if the petrodollar system collapses, what is that going to mean for the U.S. economy?
Those are very important questions, and they will be addressed later on in this article. First of all, let’s take a closer look at the agreement reached between Saudi Arabia and China recently.
The following is how the deal was described in a recent China Daily article….
In what Riyadh calls “the largest expansion by any oil company in the world”, Sinopec’s deal on Saturday with Saudi oil giant Aramco will allow a major oil refinery to become operational in the Red Sea port of Yanbu by 2014.
The $8.5 billion joint venture, which covers an area of about 5.2 million square meters, is already under construction. It will process 400,000 barrels of heavy crude oil per day. Aramco will hold a 62.5 percent stake in the plant while Sinopec will own the remaining 37.5 percent.
At a time when the U.S. is actually losing refining capacity, this is a stunning development.
Yet the U.S. press has been largely silent about this.
Part II: The Beginning of the End of the Petrodollar: And The United States
Throughout history, empires and their civilisations have come and gone. During the first part of the last century, the US quietly built its empire, first in the North and Central Americas and in South America. Soon after the Second World War, the US worked to maximise the advantages it gained, and the power it assumed, between 1943 and 1945, from its victory over Germany and Japan, and as a consequence of massive Soviet casualties, and large British debt and financial burden caused by the war. The USA assumed the leading role in the Western world by, on one hand, containing the Soviet Union and preventing the spread of communist revolution beyond the borders of the Soviet bloc; and on the other hand, ensuring uncontested American supremacy within the Western world.
During the Cold War years, there was little or no challenge to the dominant position of the US in the Western world. However, with the end of the Soviet Union in 1991, the knot tying the basic objectives of the US global strategy together began to come unravelled. Once the communist danger was off the table, American supremacy ceased to be an automatic requirement of the Western system.
Since 20 September 2002, the US government has abandoned its former multilateral approach to global affairs, and adopted an imperial posture known as the so-called Bush doctrine.
This new agenda is based on militarist and imperial values with some theocratic overtones. This current agenda looks much like what some people see in US foreign policy at the end of the 19th century, and the beginning of the 20th, when the US actively sought to dominate the entire Caribbean basin, Central America and even the western Pacific.
Six months after the Bush doctrine was announced, the new American doctrine was applied as a justification for an unprovoked war against Iraq by the neo-conservative administration of the US government. Toppling Saddam Hussein’s regime without the support of the UN, and in the face of strong opposition from traditional US allies, was a clear presentation of a new unilateralist American foreign policy. The “regime change” in Baghdad was not an isolated event, but only an opening salvo in a much broader neo-conservative agenda. The neo-conservatives ‘advocate a paradigm shift in which the United States spreads American values by asserting American power-by force, if necessary’. This agenda seeks to reshape American hegemonic practices according to old imperial doctrines, but with new post-colonial political and military tools.
Since 2005, there is a looming crisis brewing over Iran. In the media the phantom of Iran “threat” is being amplified across the world. In order to justify a military operation against Iran, the neo-conservative rulers of the US have started a demonization campaign against this country, presenting the latest incarnation of America’s enemy, in much the same way Saddam Hussein was in the run-up to the invasion of Iraq. They have put a lot of effort into making people believe that Iran is ruled by dangerously crazy people who are trying to make a nuclear bomb, and that they would not hesitate to bomb one or more US cities. In view of such a danger, the only answer is to wage a preventive war. Speculations about possible U.S.-Israel attacks on Iran have reached a stage of war propaganda by Western media. A recent report by the Oxford Research Group revealed that any bombing of Iran by U.S. forces, or by their Israeli allies, would result in the unnecessary death of many innocent lives.
Many observers view the US neo-conservative clique and its agenda as a conspiracy. This article, however, is based on the premise that they are merely part of a larger equation of global economic and political conditions. This view is rooted in an understanding that vested interests representing the energy, electronics, weapons, and influential segments of the media and communications industries in the US are always entrenched in key sectors of government. These interests are concerned with maintaining their privileged position. And key elements of the US economic and political elite are now responding directly to changes in global conditions that have arisen since the end of the Cold War. This is not a conspiracy. It is only business as usual.
Since the end of the Cold War, the US has waged four wars – two in Iraq, one in the former-Yugoslavia, and one in Afghanistan- and is threatening more. All this aggression is not the result of a paranoid theory, but simply a convergence of political and economic interests, travelling under the rubric of “war on terror”. This argument is not based on the image of a few evil people, conspiring in secret, against the people for their evil aims. However, diverging from conspiracy theory does not ignore the fact that indeed there are real conspiracies, criminal or otherwise. In particular, the US political landscape is littered with examples of illegal political, corporate and government conspiracies, such as Watergate, and the Iran-Contra scandal.
Having said that I generally consider the belief in conspiracy theories a pointless diversion of focus, and waste of energy. While real conspiracies have existed throughout history, history itself is not a conspiracy.
Since the end of the Cold War, the power of the United States is in decline. Particularly its share of world trade and manufacturing is substantially less than it was just prior to the end of the Cold War, and its relative economic strength measured against the EU and the East Asian economic group of Japan, China and Southeast Asia is similarly in retreat. The persistent use of US military power can be viewed as a reaction to its declining economic power and not merely as a response to the post-Cold War geopolitical picture. The American neo-conservative leaders see the military power of the US ‘as a trump card that can be employed to prevail over all its rivals’, and thus stop this decline. This is what the Bush administration is trying to achieve: to create a militarised world in which the strength of the US military forces can change and re-define the rules of the game. This is a clear goal, a specific agenda, which does not constitute a conspiracy. It is merely the way in which the system currently works, and the US is taking advantage of existing structural opportunities. This article is an attempt to provide primarily a macroeconomic explanation to the origins of and motivations behind the recent US policies shaped by the neo-conservative Bush administration.
Part III: Why Are We Letting China Buy American companies?
CAN YOU IMAGINE THE INFLATION ALL HITTING THE SYSTEM AT ONCE?
IN MY OPINION, THAT PUTS THE STOCK MARKET’S REAL VALUE AT LESS THAN AN OUNCE OF GOLD WHEN THE FINANCIAL HOUSE OF CARDS FINALLY DOES COME CRASHING DOWN. ITS ALMOST COMPLETELY WORTHLESS, REGARDLESS OF THE NUMBER IT READS. OF COURSE STOCKS ARE GOING TO PLUNGE!
This takeover, the largest takeover of a US company by a Chinese firm, represents a precedent that will damage the American economy and cost jobs in the long run.
It also may have emboldened China. Weeks after permission was granted by Washington, Beijing claimed the airspace over some contested islands in the East China Sea as “a defense identification zone.” Chinese saber rattling forced the Pentagon to dispatch two unarmed B-52 bombers to fly in the airspace to send a message to China that it was overstepping its bounds.
China’s ambitions are multi-pronged and the Smithfield Foods transaction is another questionable invasion by Beijing. Currently, American authorities only evaluate foreign takeovers on the basis of national-security issues or shareholder rights and securities laws. But these criteria are inadequate.
A fairer test in the case of Smithfield, and future buyout attempts by China, should also require reciprocity: Only corporations from countries that allow Americans to buy large companies should be allowed to buy large American companies.
That’s not the case with China, Middle Eastern sheikhs or Russians. Critics of reciprocity label this as protectionism. It’s not. It’s protectiveness.
Last year, Chinese banks were also allowed for the first time to buy several financial institutions. Next year, in the absence of curbs, China will likely launch a bid for a sizeable resource company. This was last attempted in 2005, when a Chinese oil giant bid $18.5 billion to buy Unocal Corporation. Congress and the media reacted negatively and the Chinese withdrew the bid.
But Wall Street has been lobbying to allow China in to make big takeovers so it can earn larger fees.
They and others argue that restricting China would be unfair and foolish because American companies have been allowed to invest billions in China. But investments there are restricted to “green fields” — high-risk start-up operations or minority ownership. The fact is that Coca-Cola or General Motors or Maytag cannot take control of an existing, established Chinese rival.
Smithfield has become the branch plant of its new proprietor — a holding company called Shuanghai International Holdings Limited, the biggest meat processor in China. But the ultimate beneficial owner is the Chinese government, and Shuanghai answers to the politics, policies and edicts of Beijing. This is the nature of “China Inc.”
The Smithfield buyout is a great loss because the company has become a huge exporter, to Japan and elsewhere, and has developed, with taxpayer assistance, systems and technologies that are best in class.
Of course, that was why it became a target and why China Inc. overpaid to get it. But the only American beneficiaries will be a handful of investors. The rest of Smithfield’s stakeholders, and the American economy, will be bruised.
The damage includes the fact that Smithfield’s technology, research and development and patents will be transferred to the Chinese parent company. Smithfield will be hollowed out and the head office will be moved to China. Talent will leave.
Part IV: Get Ready America. It’s Going to be US In the Nike Sweatshops Very Soon!
- The Role These Chinese Buys Will Play In Our Downfall
- What is FRACTIONAL RESERVE BANKING and why does it matter?
- I talked about our lack of ability to PRODUCE for ourselves if we had to.
- The Article Talks About the Chinese Investments
HOW IS ALL THIS WORKING TOGETHER?
THINK… NONE OF THIS FACTORS OUR DOMESTIC FINANCIAL WOES
ARTICLE BELOW DOES AN UNREAL JOB EXPLAINING THE CURRENT TRANSITION
What Russia has done is allow the Chinese to become the wholesale brokers of Russian oil. The deal is between Russian Rosneft the biggest oil company in the world and China’s Sinopec. The deal is valued at $85 billion and will supply China with 100 million tons of Crude oil. On top of that LNG (Liquid Natural Gas) deal was signed that will sell 3 million tons of LNG per year to China as well . The energy deals between the two partners is worth $270 Billion over the course of 25 years. Over 21 trade deals in total have been signed by the two powers and none of them have anything to do with the dollar.
imply incredible is what I can say that has transpired in the last 6 years since the collapse of the US economy in 2008. Folks what we are witnessing right now is the final paragraphs of the final chapter that was the US economic superpower. I am not kidding you nor am I using any form of hyperbole when I say that this year is critical. Though I do not posses a crystal ball to tell you “EXACTLY” when the end will come, what I do posses is major market as well as global indicators that can give me an idea as to a time frame.
Using the vast amount of data at my fingertips what I can tell you is this: 2014 is the year to prepare and get your life in order and I will detail this as clearly as I can to show you why.
- First and foremost there is a major global reconfiguration away from the dollar as a the preferred means of trade settlement.
I have often stated that the largest economies have taken strategic steps already to trade in a world without the dollar. The chief architects of this plan are the Russians and Chinese and what they have done and are doing is dismantling with precision the petro-dollar supremacy. Case in point, Russia is the largest oil producer in the world and they have back in 2013 set up a deal with the Chinese. That deal was the first major shot into the Dollar’s armor as world reserve currency and it’s grip to the pricing of oil
So what does it mean? Simple the largest oil producer is handing off the distribution of it’s product to the largest economy in world (China) to sell it in YUAN bypassing the dollar!!! In order to put this in proper perspective you have to get into your head that the entire Petro-Dollar scheme was based off the idea of cheap Saudi oil supplied perpetually. Well that reality is coming apart in a major way, lets take a second and look at Saudi oil and it’s history.
Part V: The Coming Economic Enslavement of Communism
Experts Warning of Coming Global Financial MeltdownThis all is starting to make a lot of sense now. In the last month there has been 8 mysterious death of 8 bankers across the globe. Maybe they knew something and were trying to warn others before its too late. From Bank of America’s head of global technical strategy warning that the U.S. dollar is in serious trouble, to Capitol One’s unprecedented policy change where they will now show up at Credit Card users homes to collect on debts, it seems even the big banks are going into panic mode.
In spite of all the government media propaganda, the warning signs are getting harder and harder to ignore. The fact is, our economy has teetered on the edge of the financial abyss for quite some time; and with the government now racking up over $1 trillion dollars a year in debt, it’s only a matter of time before the house of cards comes crashing down.U.S. about to hit the Debt Ceiling Yet Again…We are now only a couple of weeks away from another possible government default, as Treasury Secretary Jack Lew warns the government will run out of money to pay the nation’s bills, unless congress yet again raises the federal debt limit.
As part of the so-called budget deal that reopened the government last October, Congress suspended the $16.7-trillion debt limit through Feb. 7, 2014. With that deadline now passed, we’re now only weeks away from another possible default, causing some to wonder how much more this economy can take. In fact, former Harvard Economist Terry Burnham is so worried that he pulled all of his money out of Bank of America, and started warning everyone that they might want to consider doing the same.
Part VI: China Starts To Make A Power Move Against The U.S. Dollar
With the Chinese buying up and owning our few (relative) existing factories, we will be weak and at the mercy of others. We will be beyond any level of weakness the United States has ever known. In comes FEMA Cammps…
In order for our current level of debt-fueled prosperity to continue, the rest of the world must continue to use our dollars to trade with one another and must continue to buy our debt at ridiculously low interest rates. Of course the number one foreign nation that we depend on to participate in our system is China. China accounts for more global trade than anyone else on the planet (including the United States), and most of that trade is conducted in U.S. dollars.
This keeps demand for our dollars very high, and it ensures that we can import massive quantities of goods from overseas at very low cost. As a major exporting nation, China ends up with gigantic piles of our dollars. They lend many of those dollars back to us at ridiculously low interest rates. At this point, China owns more of our national debt than any other country does. But if China was to decide to quit playing our game and started moving away from U.S. dollars and U.S. debt, our economic prosperity could disappear very rapidly. Demand for the U.S. dollar would fall and prices would go up. And interest rates on our debt and everything else in our financial system would go up to crippling levels. So it is absolutely critical to our financial future that China continues to play our game.
Unfortunately, there are signs that China has now decided to start looking for a smooth exit from the game. In November, I wrote about how the central bank of China has announced that it is “no longer in China’s favor to accumulate foreign-exchange reserves”. That means that the pile of U.S. dollars that China is sitting on is not going to get any higher.
In addition, China has signed a whole host of international currency agreements with other nations during the past couple of years which are going to result in less U.S. dollars being used in international trade. You can read about many of these agreements in this article.
This week, we learned that China started to dump U.S. debt during the month of December. Many have imagined that China would try to dump a flood of our debt on to the market all of a sudden once they decided to exit, but that simply does not make sense. Instead, it makes sense for China to dump a bit of debt at a time so that the market will not panic and so that they can get close to full value for the paper that they are holding.
As Bloomberg reported the other day, China dumped nearly 50 billion dollars of U.S. debt during the month of December…
China, the largest foreign U.S. creditor, reduced holdings of U.S. Treasury debt in December by the most in two years as the Federal Reserve announced plans to slow asset purchases.
The nation pared its position in U.S. government bonds by $47.8 billion, or 3.6 percent, to $1.27 trillion, the largest decline since December 2011, according to U.S. Treasury Department data released yesterday.
This is how I would do it if I was China. I would try to dump 30, 40 or 50 billion dollars a month. I would try to make a smooth exit and try to get as much for my U.S. debt paper as I could.
So if China is not going to stockpile U.S. dollars or U.S. debt any longer, what is it going to stockpile?
It is going to stockpile gold of course. In fact, China has been voraciously stockpiling gold for quite some time, and their hunger for gold appears to be growing.
According to Bloomberg, more than 80 percent of the gold that was exported from Switzerland last month went to Asia…
Part VII: U.S. Stock Market Takes a Dive – Is The Bubble Beginning to Pop?
THIS ARTICLE IS IN MY SERIES FOR ONE REASON, AND ONE REASON ONLY.
In regard to the U.S. stock market bubble it’s not a question of if it will pop, but rather of when (and what excuse the so called experts that denied that it was coming will use to distract from the real cause). They’ll tell you it was due to slow downs in emerging markets, some disappointing jobs report or lower than expected corporate earnings, but this is like blaming a blade of grass that a soap bubble lands on for its demise. Bubbles pop because they are bubbles. Once they are inflated the result is inevitable. The wind may carry it a bit farther than expected (QE3) but sooner or later the laws of nature always prevail.
Part VIII: 25 Fast Facts About The Federal Reserve – Please Share With Everyone You Know
Most Americans are under the illusion the FED is somehow part of our government. Whether that would be a good thing or a bad thing is really irrelevant, because it’s not. The FED is an independently owned bank that operates for the benefit of one group of people and one group of people only… the owners of the Fed.
As we approach the 100 year anniversary of the creation of the Federal Reserve, it is absolutely imperative that we get the American people to understand that the Fed is at the very heart of our economic problems. It is a system of money that was created by the bankers and that operates for the benefit of the bankers. The American people like to think that we have a “democratic system”, but there is nothing “democratic” about the Federal Reserve. Unelected, unaccountable central planners from a private central bank run our financial system and manage our economy. There is a reason why financial markets respond with a yawn when Barack Obama says something about the economy, but they swing wildly whenever Federal Reserve Chairman Ben Bernanke opens his mouth. The Federal Reserve has far more power over the U.S. economy than anyone else does by a huge margin.
THE FED IS THE BIGGEST PONZE SCHEME IN THE HISTORY OF THE WORLD, and if the American people truly understood how it really works, they would be SCREAMING for it to be abolished immediately. The following are 25 fast facts about the Federal Reserve that everyone should know…
#1 The greatest period of economic growth in U.S. history was whenthere was no central bank.
#2 The United States never had a persistent, ongoing problem with inflation until the Federal Reserve was created. In the century before the Federal Reserve was created, the average annual rate of inflation was about half a percent. In the century since the Federal Reserve was created, the average annual rate of inflation has beenabout 3.5 percent, and it would be even higher than that if the inflation numbers were not being so grossly manipulated.
#3 Even using the official numbers, the value of the U.S. dollar has declined by more than 95 percent since the Federal Reserve was created nearly 100 years ago.
#4 The secret November 1910 gathering at Jekyll Island, Georgia during which the plan for the Federal Reserve was hatched was attended by U.S. Senator Nelson W. Aldrich, Assistant Secretary of the Treasury Department A.P. Andrews and a whole host of representatives from the upper crust of the Wall Street banking establishment.
#5 In 1913, Congress was promised that if the Federal Reserve Act was passed that it would eliminate the business cycle.
#6 The following comes directly from the Fed’s official mission statement: “To provide the nation with a safer, more flexible, and more stable monetary and financial system. Over the years, its role in banking and the economy has expanded.”
#7 It was not an accident that a permanent income tax was also introduced the same year when the Federal Reserve system was established. The whole idea was to transfer wealth from our pockets to the federal government and from the federal government to the bankers.
#8 Within 20 years of the creation of the Federal Reserve, the U.S. economy was plunged into the Great Depression.
#9 If you can believe it, there have been 10 different economic recessions since 1950. The Federal Reserve created the “dotcom bubble”, the Federal Reserve created the “housing bubble” and now it has created the largest bond bubble in the history of the planet.
#10 According to an official government report, the Federal Reserve made 16.1 trillion dollars in secret loans to the big banks during the last financial crisis. The following is a list of loan recipients that was taken directly from page 131 of the report…
Citigroup - $2.513 trillion
Morgan Stanley - $2.041 trillion
Merrill Lynch - $1.949 trillion
Bank of America - $1.344 trillion
Barclays PLC - $868 billion
Bear Sterns - $853 billion
Goldman Sachs - $814 billion
Royal Bank of Scotland - $541 billion
JP Morgan Chase - $391 billion
Deutsche Bank - $354 billion
UBS - $287 billion
Credit Suisse - $262 billion
Lehman Brothers - $183 billion
Bank of Scotland - $181 billion
BNP Paribas - $175 billion
Wells Fargo - $159 billion
Dexia - $159 billion
Wachovia - $142 billion
Dresdner Bank - $135 billion
Societe Generale - $124 billion
“All Other Borrowers” - $2.639 trillion
Part IX: Explaining The Federal Reserve, Inflation, and the Economic Bubbles About To BURST In Layman’s Terms
DO YOU EVER WONDER?
Ever wonder about why our economy is in trouble? How can so many people can be in so much debt at the same time? Does it seem strange to you no matter how hard one works, and in spite of all the advances in society, most hard working people cannot escape the treadmill of perpetual debt?
Why are so many families losing their homes to foreclosure? Why are many households dependent upon credit cards to supplement their income? Why does it take TWO spouses to maintain a household when it used to take just one? Why have so many retirement savings been wiped out? Why do prices always creep up?
Did you know that close to 1/3 of all income taxes are consumed just to pay interest on the Federal Debt? (National Debt currently 17 TRILLION DOLLARS , or about $165,000 per household.) Think about it. Every penny that you pay in income tax from January 1 - April 1 is consumed just to pay interest on Federal debt, much of it to foreign banking families! And let’s not forget the Government’s unfunded future liabilities, estimated at 75 TRILLION. (an additional $750,000+ per household.)
Add those staggering sums to the 11 Trillion in total consumer debt (mortgages, car loans debt, credit cards, etc), student loan debt (1 Trillion more), State debt, County debt, City/Town debt, small business debt, big business debt, and you will see that the total of these debts actually exceeds (BY FAR) the amount of money supply in circulation.
So, how can such astronomical debt ever be repaid? Well, if you haven’t figured it out yet – IT CAN’T. The only way for society to service just the interest on these monstrous debts is to constantly inject new debts into the system.
Finally, on top of all your Federal, State, gasoline, and local taxes, (30% – 40% of your gross income) and on top of your personal debt service burden (another 25%-50%), there’s this thing called “inflation”, or ”the cost of living.” What exactly is “the cost of living?” What causes it? Why does a dollar buy less and less each year while wages stay flat?
Is the stress of perpetual debt and rising prices keeping you up at night? How many strokes, heart attacks, and even suicides are induced by financial stress each year? Money and debt may even have led to your drinking problem, or perhaps even to depression. Debt may have been the underlying cause of your divorce or that of some couple that you know.
You know in your gut that something isn’t right in this country. But you don’t have the “Economics education” to figure it out. It all seems too complicated for you to put your finger on, so you just keep slaving away to pay interest and taxes as your dollar buys less and less. All you can do is keep working like a dog and leave the matter to the Wall Street “experts” and politicians to handle for you.
But it’s all quite simple really. So simple in fact, even a dummy can understand it when it is broken down to basic elements.
Part X: A Storm is Brewing on the Horizon – Martial Law Before 2016?
Problems I See As Unavoidable:
This is a perfect chance for my two cents on the monetary system. Parts I – IX gave all the technical reasons the Dollar doesn’t stand a chance in the long run. I think it’s far more common sense than all those technical reasons, but I wanted to shut up all the nay sayers.
First, I think we can assume a worthless Dollar is VERY bad. That takes away our ability to import things we don’t produce domestically. That means whatever we use to sustain ourselves as a nation has to be here. Let’s think about it: As Part III put, we have not only outsourced almost all of our production capability overseas for cheap labor, what little production capacity we have left is being rapidly bought up by the Chinese so they can get out of our Dollar and retain something of value: namely our production capability.
How do 300 million people survive if we can’t import anything and don’t produce squat because we are a “service” economy now? Short answer? We don’t. Not enough for everyone. That means if you have food, people will do whatever is necessary for them and their loved ones. Chances are if you have none, you’ll do the same. THAT is how a worthless Dollar plays out. Period. There will be a TON of violence for those without somewhere safe, heavily stocked with food, and well protected.
NOW, THE MILLION DOLLAR QUESTION: DO WE EVER GET TO THAT POINT?
- Right now the Fed is monitizing our debt to the tune of about 85 BILLION per month. That is over $5 TRILLION OUT OF THIN AIR since Obama took office. What does that mean? It means they are printing that money out of thin air. That does two things. First, it debases our currency as can be seen by one look at the dollar index. LOOK YOURSELF! The dollar has been in free fall. The ONLY thing saving the Dollar is that it is still the world reserve currency… but don’t get too excited because I’ll get to that later. Don’t count on that continuing for long. In addition to debasing the currency, it creates inflation. MASSIVE INFLATION.
- The government tells us inflation is like 2%. Um. Ok. Gas went from under $2.00 to close to $4.00. What is that? Food prices are going up – but NOTHING like they will be soon. The same bag of dog food I used to get for $9.50 is now about $13.00. What is that if not inflation? That doesn’t sound like 2% to me. Anyone in your family who does the food shopping KNOWS food prices are going up much more than 2%.
- We have not even begun to feel the inflation that is coming as a result of the printing presses Obama and his economic advisors have been running around the clock.
- As I mentioned we use a system of banking called Fractional Reserve Banking. Everyone knows banks have been tight on lending money. Familiarize yourself with how Fractional Reserve Banking works, and imagine when the full extent of all this printed money IS actually all in circulation. OMG. Prices will SKYROCKET… and I’m still not even touching the reserve currency status yet. I’m assuming we still have that thus far. Stay tuned for more on that.
- Remember those baby boomers on fixed incomes? How are those skyrocketing prices going to work out for them? Expect ramped up foreclosures and parents moving back in with their kids. As more people experience financial hardship they’ll buy less stuff, causing companies to cut back MORE – that means more layoffs, more foreclosures, and the cycle keeps going. This is when I see the Dow ultimately dipping to around 5,000.
- Furthermore, if there are skyrocketing prices, and super high unemployment, how will people feed their families? Hmmm. I sense this could create some MAJOR problems. I fully predict neighbor will be robbing neighbor trying to feed starving family members, so you better be armed and ready to protect your food…. oh wait… Obama wants your guns. Wow.
2. Healthcare: Even without the atrocity otherwise known as Obamacare, the costs of healthcare have already been increasing exponentially, so healthcare is potentially the first domino in a long line of dominos that ultimately bring down the financial strength of this nation. How? I am a simple man, so I’ll use simple arithmetic:
- We have the largest generation in American history just entering retirement. Consequently, as a nation we will face the largest expenditures for healthcare probably in human history, but at the very least in American history. Where are these baby boomers going to get the money to pay those medical bills? The “stock market” (which is a term I will use generally for retirement investments) is where most of this enormous group of Americans have the bulk of their wealth tied up. Not all do, but a huge majority of them.
- Prior to the 2008 crash it was estimated about 40% of Americans had enough money saved for retirement. Let’s be REALLY optimistic and say that after the crash 35% still had enough. First of all, that would be LUDICROUS, but lets assume so anyway. It’s obviously a MUCH lower number.
- As the baby boomers begin to cash in those investments for their ungodly high medical bills and their retirement living in general, the stock market is inevitably going to drop as money is pulled out. It MIGHT not be so bad if Generation X or their employers were contributing even a fraction of what their baby boomer parents did to replace the withdrawls. HOWEVER, the reality is that so many Generation X ‘s are out of work or underemployed, so there is NOWHERE NEAR enough going in to replace what will be coming out. Furthermore, about 50% of the money in the stock market right now is “Institutional Investors.” When the Fed is lending at 0%, why not borrow and invest speculatively if you’re a huge financial institution?
- Guess what? BUBBLE #1: We have another stock bubble brewing, but that is the smallest of the bubbles presently brewing. At some point, the institutional investors will begin the selloff and start to get out of the overpriced market while the getting is good. In an attempt to minimize losses to their retirement funds, the mom and pops of the country are going to be scrambling to get out as fast as they can. Prices will be dropping like a rock as institutions pull out in volume, and mom and pop always panic. It’s like clockwork. THEN, stocks REALLY start to drop like a ROCK as everyone is trying desperately to get into CASH. On a side note, when the market bottoms out and the mom and pops are all cleaned out and devastated, THAT is when the institutional investors will jump back in at low prices and ride the wave back up that screws the average investor again. It’s a cycle. That’s assuming we’re not under Martial Law by then- but I’ll get to that in a bit.
- As stock prices drop, eventually we’ll see a mad selloff driven by fear like in 2008. In turn, since corporations could care less about the welfare of their employees, and they only care about the almighty shareholder – it will be LAYOFF time. MASSIVE LAYOFFS will be needed to cut costs so share prices stay up as much as possible. The more people continue to get laid off, you can count on the cycle of people not making their mortgage payments to start up again. THEN, another super round of foreclosures will begin. Banks still haven’t gotten rid of all the previous foreclosures on the books from 2008, so expect prices of homes to drop faster than you can say FAST as the selloff begins again.
- More people pull out of the market, leads to more layoffs, leads to more jobless, leads to more foreclosures, and the cycle will be rapid. I could easily see the Dow and an ounce of gold both being around $5,000. Yes – I said 5,000. I am very well aware we’re at 16,000 now. But how you ask? Calm down, I’m getting there.
Courtesy of keepcalm-o-matic.co.uk
Within the past few weeks, at least three high level bankers and one financial journalist have either died due to mysterious circumstances that officials have quickly labeled as ‘suicides’, or disappeared without a trace. With little information to go on from most public sources, several outside investigators have questioned the timing and reasons why these individuals have suddenly died, or been killed off, and are continuing to seek answers.
However, on Feb. 5, an insider and former head trader for a top banking firm issued a warning that new information is out which shows that ‘hit squads’ have been made active in the Wall Street area, and that a high level banker tied to recent investigations into Forex manipulation, along with up to three dozen others involved in scandals, are being targeted for potential assassination in light of their viability as witnesses and whistle blowers to federal and financial regulators.
Word on the “street” watch for a top level American bankster to expire. Hit teams are fully operational in Wall Street. (REDACTED) HIGHLY VISIBLE POWER BROKER- co-ordinating. Speak to you soon. Please post this to warn sheep. V-UPDATE 9:24 AM MOUNTAIN-NEXT ON THE HIT LIST CITI EXECUTIVE TIED IN WITH FOREX FRAUD -HIT LIST HAS 3 DOZEN MORE NAMES-DESPERATE TIMES REQUIRE DESPERATE MEASURES IN THE WORLD OF MONETARY CONTROL! JPM can’t hold yellow metal shorts on notional gold. LIBOR and derivative hits continue as bankster suddenly commit “suicide”. 43 are on the knock off list and counting. The shock waves of this and many other scandals are creating turmoil everywhere. – V, Guerrilla Economist, Q Alerts
Courtesy of usapartisan.com/
On March 13, the son of Jon Corzine was found dead in Mexico City of an apparent suicide. Jon Corzine was the former CEO of Goldman Sachs, head of MF Global, and Governor of New Jersey, as well as being a long time campaign financier for President Barack Obama.
The son of former New Jersey Gov. Jon Corzine killed himself in a Mexico City hotel, sources told The Post on Thursday.
Jeffrey Corzine, 31, was the youngest of Corzine’s three children with ex-wife and childhood sweetheart Joanne Corzine.. – NY Post
While little is known about the circumstances behind Jeffrey Corzine’s alleged suicide, his death comes on the heels of at least eight unusual banker deaths, many of which were also labeled as suicides despite the near impossibility of one of them being attributed to suicide by nail gun.
‘He made the tragic decision to take his own life’: Youngest son of former New Jersey Governor Jon Corzine commits suicide in Mexico City hotel
Jeffrey Corzine took his own life ‘several days ago’ in Mexico City hotel
His family traced him through his credit card
Had battled addiction through his teens and twenties
Jeffrey, 31, was thought to be working as a drug counselor in California
He was the youngest of Corzine’s three children with his first wife
Corzine’s successor Chris Christie issued a statement of his condolences, calling the death ‘unthinkable’
Former New Jersey Governor Jon Corzine’s 31-year-old son, Jeffrey, – who struggled with drug and alcohol addiction – committed suicide at a Mexico City hotel this week, a person familiar with the matter said on Thursday.
Jeffrey Corzine had been living in Malibu, California, and was an aspiring photographer, said the person, who spoke on condition of anonymity and could not name the hotel.
Corzine family spokesman Steven Goldberg confirmed Jeffrey Corzine’s death in a written statement.
Jeffrey Corzine is seen at his father’s side (right) when he was elected to be the governor of New Jersey in November 2005. His brother, Josh, is also pictured raising his father’s hand in victory (left).
Young: Jeffrey, who was known to friend as ‘Jeff’, was the youngest of three siblings
Discovered: The US Embassy in Mexico City confirmed that Jeffrey Corzine was found dead in a Mexico City hotel ‘several days’ ago
‘The sad fact is that Jeffrey Corzine had been suffering from severe depression for several years and recently had been receiving treatment for what is a very painful and debilitating physical and mental ailment,’ Goldberg said.
‘On Tuesday morning, he succumbed to his disease and made the tragic decision to take his own life.’
The family is planning a small, private memorial for Jeffrey, Goldberg said.
Corzine, who was described by family friends as a ‘lost’ soul, was discovered dead in Mexico City ‘several days’ ago after failing to reply to messages from loved ones.
His friends and family tracked down his whereabouts to his hotel by following his credit card trail.
Courtesy of oil-price.net
On March 6, Congress passed overwhelmingly, at the behest of the Obama Administration. new economic sanctions on Russia for their intervention in the Crimean region of Ukraine. In doing so, President Obama has now placed the dollar and entire Treasury reserve structure at risk, and as Dr. Jim Willie noted yesterday, has brought America to the brink of its ‘Waterloo’.
If the Kremlin demands Gold bullion (or even Russian Rubles) for oil payments, then the interventions to subvert the Ruble currency by the London and Wall Street houses will backfire and blow up in the bankster faces. Expect any surplus Rubles would be converted quickly to Gold bullion. If the Chinese demand that they are permitted to pay for oil shipments in Yuan currency, then the entire Petro-Dollar platform will be subjected to sledge hammers and wrecking balls. The new Petro-Yuan defacto standard will have been launched from the Shanghai outpost. If the Saudis curry favor to the Russians and Chinese by accepting non-USDollar payments for oil shipments, then the Petro-Dollar is dead and buried. The rise of the Nat Gas Coop run by Gazprom is in progress, its gas pipelines to strangle the OPEC and its bastard Petro-Dollar child. The entire USDollar foundation with the USTreasury Bond bank reserve structure is at risk is collapsing, as consequence to the desperate adventure and criminal activity conducted in Ukraine. – Silver Doctors