Tuesday, December 30, 2008

Trust is gone

Americans and others have no idea what is going on nor do they understand the gravity of the situation. This is an event that only happens once every 500 to 1,000 years. This is going to be one of the granddaddies of all collapses. The elitists had to play boosting the value of real estate to dizzying heights and then burying it in structured finance. In a world of stable real estate prices, SIV’s and CDO’s were relatively risk free, but this was not a stable environment. Professionals should have realized that normal rules didn’t apply. Foreign banks, hedge funds, insurance companies and other institutions bought 70% of what became toxic waste, as they poured dollars back into the US economy supplying at times $3 billion a day in investment to keep America from going bankrupt. The buyers knew that lending practices had changed dramatically and that risk had increased exponentially. Eighty percent of mortgages were being securitized.
Almost the entire world economy is built on a Ponzi
scheme promoted and sponsored by bummint and the
fractional reserve banking system backed by promises.

Trust is gone.

The entire paper edifice will burn since the new
entrants to support it are no longer doing so.

They left.

Got gold or silver?

Full article.

Wednesday, December 24, 2008

Consumer Demand For Nearly Everything Plunges

When Japan faced deflation it had an internet boom and US consumer demand (exports) to cushion the blow. Japan also had savings to fall back on. The US has no such cushion, no savings, no source of jobs, and an extremely high level of consumer debt. I have been saying for years those factors make the deflationary pressures in the US far worse than anything Japan faced.

Pudding is served. That pudding is called deflation. And unlike Japan, the US threatens to take much of the world down in a deflationary spiral right along with it.

Eventually this had to happen given that nearly every country in the world, in some fashion or other, became hugely dependent on the US shopping center economic model that is now history.

Tuesday, December 23, 2008

Change you won't believe

A key concept of the economy to come is that size matters -- everything organized at the giant scale will suffer dysfunction and failure. Giant companies, giant governments, giant institutions will all get into trouble.
Far beyond 'trouble'...most will fail.
We still think that "the path to success" is based on getting a college degree certifying people for a lifetime of sitting in an office cubicle. This is so far from the approaching reality that it will be eventually viewed as a sick joke --

Monday, December 22, 2008

You will pay and pay for this...in ways you can't yet imagine

“… Authority has always attracted the lowest elements in the human race. All through history mankind has been bullied by scum. Those who lord it over their fellows and toss commands in every direction and would boss the grass in the meadow about which way to bend in the wind are the most depraved kind of prostitutes. They will submit to any indignity, perform any vile act, do anything to achieve power. … Every government is a parliament of whores. The trouble is, in a democracy the whores are us.” –- P. J. O’Rourke
How do you like paying for all that screwing you're getting?

Wednesday, December 17, 2008

Economic Armageddon Riots in America in 2009 - Gerald Celente

Classic street sense...

(These are all only audio even though they're on You Tube.)

Part 1 of 2

Part 2 of 2

Tuesday, December 16, 2008

Follow the money, not the soundbites. Follow the truth, not the bullshit.

Reality is finally beginning to dawn on those who believed their denial would save them from what they fear. What is happening is a surprise only to the indentured slaves of debt who believed the banker's promise that credit would give them their dreams; instead, that credit has now become debt and their dreams have become nightmares.

The past year has destroyed the illusion of eternally expanding growth driven by eternally expanding credit.
Highly recommended.

Monday, December 15, 2008

More on deflation

First, if you look overall at what has happened, it’s massive world deleveraging and debt deflation driving it. As we mentioned before, over $1000 trillion of leveraged markets are unwinding, and if you add up all the central bank efforts to loosen credit markets and do bank bailouts, it adds up to roughly 15 to 20 $trillion.

Well, $20 trillion is not near enough to stop $1000 trillion of markets deleveraging. So, the efforts are doomed to fail.
Highly recommended.

Thursday, December 11, 2008

Avoiding the collapse

"There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as a result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved." --Ludwig von Mises

Thursday, December 04, 2008

The Coming State of the States

I know you are all struggling to come up with budgets under difficult circumstances. 41 states are likely to face budget shortfalls either this year or next. -Obama, National Governor's Association, CNBC OPENING BELL, December 2, 2008, 10:35:41
Schwarzenegger warned that California could run out of cash within two months,...