The Collapse of Capitalism and the Safety Net of Gold

Although capitalism is not a Ponzi scheme, credit-based economies, sic capitalism, and Ponzi schemes share the same fatal flaw. Both must constantly expand or they are in danger of collapse. Today, because capitalist economies are no longer expanding, but contracting, their continued contraction will lead to collapse...

...The end of such systems has always been bankruptcy. When credit-based economies contract, governments, businesses and families are no longer able to pay the principal and compounding interest on their debt and economic collapse results.

Then this classic...

Compared to communism, capitalist markets indeed appear free. Compared to free markets, capitalism is a rigged game.

Full essay.

Global Growth

Chart of Japanese exports

Yard-Sale Planet

Say goodbye to the "consumer society." We're done with that. No more fast money and no more credit. The next stop is "yard-sale nation," in which all the plastic crapola accumulated over the past fifty years is sorted out for residual value and, if still working, sold for a fraction of its original sticker price. This includes everything from Humvees to Hello Kitty charm bracelets.

...including all the new unsold cars being stored all over the planet.

Full article.

Shipping rates hit zero

"This is no regular cycle slowdown, but a complete collapse in foreign demand," said Lindsay Coburn, ING's trade consultant.

Idle ships are now stretched in rows outside Singapore's harbour, creating an eerie silhouette like a vast naval fleet at anchor. Shipping experts note the number of vessels moving around seem unusually high in the water, indicating low cargoes.

Full article.

December retail sales crash

You won't want to miss this:

[link]

Where Amurika will most likely be going

Our destination is a land of much smaller-scaled local economies. We could retain our federal ties if the federal government can scale back appropriately from the bloated, feckless enterprise it has become. Otherwise, it might only get in the way and make matters worse, and the public in one region or another of North America might reach a decision that they are better off without it. That would be what's called a revolution.

More likely a 'devolution'.

Haven't said this in awhile:

Do you have your donkey yet?

Read.

The Great Reboot

"...we don’t just need a bailout. We need a reboot." Thomas Friedman got it right in that it's : "Time to Reboot America". Unfortunately, everything else prescriptive in the article is garbage.

America does need a reboot but it can't be achieved through top-down stimulus or reconstruction. [My emphasis] It has to start at the bottom and grow organically.

Precisely. Read.

Managing to failure

All managed markets—whether managed by government allocation as under Communism or by government sponsored central bank credit as in Capitalism—are doomed to failure.

Almost no one sees this. That's why failure is a given...
total collapse, trying to fix a failed system created
by the same mentality that founded it, using the same
tools.

They don't know how to do anything else.

Earthmonkey has just been buggered in the dark again
and he doesn't know who did it.

It's a tired old story.

And, if the internet survives, they can't cover it
up as they have in the past.

Will you inform him?

Full article.

Another look at denial

As regular readers know, I've often asked questions concerning the legitimacy, or even the legal status, of a government that loses control of its economy. Today, with small but rich Belgium out for the count, I can't help wondering what it would take to bring down the governments in countries like China, Japan, Britain, Germany, Canada or the US.

See how they fall...like dominoes.

In the same vein, Stoneleigh looks ahead at the equally inevitable upcoming wars in the labour markets. Millions upon millions of people around the globe will lose their jobs in the next year, and many if not most of the lucky ones who will still be employed can expect drastic cuts to their benefits and salaries. Since governments at all levels, if only to prevent having to fire employees, will try to raise taxes at the same time that people get poorer, widespread mayhem is guaranteed. And that's before people start figuring out what happened to their savings and pensions.

Read.