43 votes

Deep Structural Cracks Manifesting within the Economic and Monetary Systems (Republicae)

If any of you recall the rather heated debates on the subject of Deflation, particularly those with DP member Greed, then you will remember I said, on several occasions that the world we live in is entirely different that the one during the period of The Great Depression. I contended that the economy was a very different economy with very different dynamics than those at play during the 1930s, indeed, even money and the financial markets are completely different now then at that period. I stated that the period we now live in would be marked by not only inflation, but also deflationary pressures. It will prove to be a monster that no one, especially government appointed central bankers will be able to contend with any degree of success. It is a new world in which the universe of economic indicators will be so skewed by distortions that the forces of economic and monetary manipulations that the establishment economists will fail to either understand or come up with a viable solution to stop the slaughter of our society.

There appears to be a definite increase in the deep structural cracks manifesting within the economic and monetary system causing confusion to abound throughout the global halls of money power and the dysfunctional political asylum we are subjected to as involuntary participates. The Panic of 2008 was simply the beginning of the systemic collapse that will ultimately consume not only the United States, but will have definite socio-economic-political ramifications around the globe. What has been produced through decades of manipulation is an economic and monetary system that are completely inundated with distortions, misdirection and misallocation. The mesh of economic confusion is so tightly woven that there will be absolutely no solutions coming from official sources because they are steeped in the mire of Proto-Keyneisan, Keyneisan, and Post-Keynesian shallow-minded dogma.

We will witness a growing mix of stagflation, deflation and inflationary pressures and events, the results of these cycles will completely allude the minds of the mainstream economic establishment. They are unaware, blind to the fact that within the mix of co-existing stagflation, deflation and inflation, these pressures will not only happen simultaneously within this distortion they call the economy, but each of these pressures have formed what could be considered a symbiotic relationship, feeding the distortions in a manner what will prove to be not only unprecedented, but totally confusing to the bureaucratic establishment mentality. It is becoming very evident that these events are beginning to dominate the markets, causing confusion at the highest levels of market activity. Corruption runs rampant and is so deeply-seated that main-street has been essentially shutout of any real possibility of gain from the markets.

Accurate information on the markets, pricing, charts and various indicators, is skewed and rarely takes into account the multitude of external information that places pressures on the markets. The big quake will come when, as we have been seeing for the last few years, the U.S. Dollar hegemony is directly challenged rather than just a matter of discussion by the governments of countries that have finally realized just what such hegemony really means economically and decades of Dollar inflation has been effectively exported to shores beyond these United States.

There is a substantial global revolt taking place, mainly behind the scenes, against the world we have grown accustom to in this country and the effects of this revolt will prove to be such a shift in structural direction that this country has been taken that few will be able to cope with the consequences. That shift is just the beginning of the monumental forces that will finally place a myriad of pressures upon the economic and monetary systems of not only the U.S. but the world.

We only catch glimpses, tid-bits of what is actually taking place behind the scenes, but there are indicators that are present on the global stage, one being the massive amounts of gold that is being purchased by various countries, particularly those in the East, like China. The Dollar is rapidly losing command and the U.S. Treasury Bonds have been effectively trapped in an inescapable quagmire that is now dependent upon the Federal Reserve for the majority of purchases.

The battle over Dollar hegemony is rapidly moving from mere preparations into a full-fledged array of battlements and flags unfurled and the defenses of the Western Government sponsored Banksters are proving increasingly insufficient to ward off the invaders. The only weapons left in the arsenal is to continue the war-torn strategy of massive inflation to cover its crimes not only against the Citizens of the United States, but also of other countries who have been subjected to decades of fiat foolery! For decades they have used the corrupt system of fiat currencies to manipulate the economic systems of not only the United States, but of all countries that have been forced to use the Dollar as the world's reserve currency. The opposition is rising rapidly on a global scale, one that will be extremely difficult to restrain with what was once common tactics of the Western Banking Cartel.

The question will be what will come from all of this? At this point it's anyone's guess, but with the mounting evidence we might be able to come up with some educated guesses. There appears to be a growing call for international reforms, but reforms that will not set well with either Western governments or their Bankster patrons. These reforms could include the management of bank reserves, the manner in which sovereign bonds are structured and issued, trade settlements, debt ratings and the way in which settlements are distributed. To the shock of many in the Western financial world, there maybe a push toward eventual justice, not merely reform.

As events unfold, the commonly-held concepts surrounding inflation and deflation will no longer make much sense, especially to those who still hold that the same mechanisms that prevailed during the period of The Great Depression in terms of deflation or the period of the Wiemar Republic in terms of inflation. The interpretation of all the factors that will surround the upcoming global shift will depend on a new understanding of all the mechanisms that have come into play on the global economic and monetary stage. We are already seeing hyper-inflation as well as what can be called deflation or a decay of assets. Normal assumptions of inflation and deflation tend to float around prices, but that is not the case; inflation and deflation are monetary phenomenons. We have, especially since the Panic of 2008, seen a massive hyper-inflationary agenda by the Federal Reserve and by just about all the central banks globally, but the effect has not yet been manifested within the markets, they are currently only responding to first stage and that is the influx of new liquidity. We have seen monetary inflation on a scale that has not been matched in history, Quantitative Easing with the monetization of U.S. and Euro Bonds is only the preliminary stages of a hyper-inflationary event that will witness a simultaneous hyper-deflationary event.

In fact, several years ago, here on the DP, I stated that the historical fear of deflation is usually the impetus for central bank inflation. That was indeed the case, for they misinterpreted the bursting of the artificial bubble they created through monetary policy as historic deflation, when, in fact, it was part of the boom/burst cycle they themselves created. The response was to attempt to re-inflate the bubble, but, as usual, they have been unable to make that correction through the use of monetary inflation because the economic potency of the fiat currency has been neutralized through inflationary depreciation over the decades.

The fact is that we are in the stage of monetary hyper-inflationary and the pressure that is mounting toward eventual hyper-price jumps that we enter into the next stage of the hyper-inflationary event, it is completely unavoidable at this point. On the reverse side, there has been and continues to be type of asset deflation that is taking place in real estate, mortgage bonds and even in bank equity.

The U.S. Economy however, has become completely addicted to and dependent upon the continued monetary stimulus of the FED, we have deficit spending dependent upon the monetizing of bonds, monetary easing that is totally supporting mortgage rates and if it were not for direct monetary inflation all types of assets would crumble. The problem is structural, and no amount of monetary inflation can repair those structural issues, for the solution to the problems in this economy are not based in the quantity of money but the quality of money, thus, because of this fact, we will continue to witness both inflationary and deflationary pressures coming to bear on this economy simultaneously.

Now, another factor that is very hard to verify is all that is taking place within the vast derivative markets, that factor may prove to be one of the final nails in the global economic coffin. Add to this factor the really weak credit links within the Global Supply Chain and we have the makings of an economic implosion that is hard to even imagine, one that could quickly take civilization back six or seven centuries.

The fact is that the financial system, and the fiat economy that created it, has already been destroyed, there is no picking up the pieces because they are still falling. The problems are beginning to manifest as the cost structure within the economy continues to rise, capital is is shambles, profits are both distorted and decimated, eventually we will see liquidation on a massive scale, liquidation that will expose actual value verses the artificially inflated prices that has, until this point, seemed to be impressive. Home sales, said to be on the rise, are being artificially propped up by the vast number of institutional investors that are mopping up blocks of homes at bargain-basement prices from the big banks portfolios that are still filled with toxic assets despite the patronage of the FED to purchase $85 Billion a month in mortgage securities and bonds. Strangely, the more the inflationary pressure the more the destruction of capital, the more the destruction of capital the greater increase in the value of assets, thus the circle continues unabated. It is almost as though the FED and everyone involved in the markets are totally incapable of understanding the mechanisms that are at work in such an economy.

We live in a time when, as a last gasp for life, the powers of the world just might attempt to do what they hate to do and that is to institute some sort of gold-backed system as a last ditch effort to save a system that should have died long ago. One thing is almost certain, those involved with the official global criminal cabal will have one last stretch of notoriety as their faces appear on wanted posters: Dead or Alive!




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I still don't see any

I still don't see any information to justify the claims or opinions.

I agree with some of the opinion, but when you move to actual claims,

It is no long just verbal opposition, the talk has turned into action, first that action was simply to work around the USD/USTB system, now however, it appears that there is an all out push to replace the USD/USTB.

this requires evidence to substantiate it. I don't follow the financial markets as closely as I used to, but maybe you can link to reliable sources demonstrating this sea change.

There are therefore, a host of black swan events that now threaten not only the banking system

By definition black swan events are unpredictable, like the discovery that black swans existed. A black swan is something that has never been observed before, and so is discounted as a possibility by false reasoning, and causes surprise when it happens. In Taleb's use of the term it also takes on the connotation of something that has major ripple effects through interconnected systems. So I don't know what you mean predicting without identifying such events.

Given the evidence, it appears that Russia and China, as well as other nations, maybe seeking a currency reset that is based on gold.

What evidence? Given the length of your article, it would have been good to refer to some of the evidence.

Republicae's picture

Opposition to the USD/USTB

Opposition to the USD/USTB system can be readily verified if one will only take the time to actually do a little research. It was not long ago when China and Japan singed an agreement that promoted the use of their own currencies, instead of the U.S. Dollar Reserve Currency, when trading with each other.

The following is from a BBC report about that agreement:
“China and Japan have unveiled plans to promote direct exchange of their currencies in a bid to cut costs for companies and boost bilateral trade. The deal will allow firms to convert the Chinese and Japanese currencies directly into each other. Currently businesses in both countries need to buy US dollars before converting them into the desired currency, adding extra costs.”

Additionally, there has been a new agreement will promote the use of their own national currencies when trading with each other rather than the U.S. dollar:

“The five major emerging economies of BRICS — Brazil, Russia, India, China and South Africa — are set to inject greater economic momentum into their grouping by signing two pacts for promoting intra-BRICS trade…The two agreements will enable credit facility in local currency for businesses of BRICS countries…[which is] expected to scale up intra-BRICS trade that has been growing at the rate of 28% over the last few years but, at $230 billion, remains much below the potential of the five economic powerhouses.”

It is also not hard to look up the fact that both Russia and China have been strongly advocating for a new global reserve currency. The fact is that both Russia and China have already been using their own national currencies when trading with each other for more than a year now.

Look what is happening in Africa. In 2009 China became the largest trading partner in all of Africa and immediately began promoting its own currency in all trade exchange, not the U.S. Dollar Reserve Currency.

A report from Africa’s largest bank, Standard Bank, recently stated the following:

“We expect at least $100 billion (about R768 billion) in Sino-African trade…to be settled in the renminbi by 2015.”

It becomes obvious that China is very determined to not only change the face of international trade, but to replace the U.S. Dollar Reserve Currency status in the process.

Even now, China and the UAE have already agreed to abandon the U.S. Dollar Reserve Currency and instead use their own national currencies for all oil transactions. While the UAE is a small player, it will not be long before the remaining OPEC countries follow suit, say good-bye to the Petro-Dollar.

For several years now India has been thumbing it's nose at the United States by using gold to purchase oil from Iran.

Saudi Arabia and China have already begun to construct a massive new oil refinery in Saudi Arabia…guess what they won't be using as the currency of trade?

It was not long ago that The United Nations issued several reports, in those reports there was a direct and open call for replacing the U.S. Dollar as the global reserve currency. In one of those reports you find the following statement:“a new global reserve system…that no longer relies on the United States dollar as the single major reserve currency.”

The IMF has also published several reports that are also calling for the replacement of the U.S. Dollar Reserve Currency.

Thus, as I said, the push is on to displace the United States and the USD/USTB system. The People’s Bank of China is considering phasing out the dollar as the reference currency or peg for the yuan, and to start using gold as the reference point.

I don't have them in front of me right now, but I will try to find the report from the World Gold Council, in that report the conclusion is that not only are the Chinese planning to back their currency with gold, but in doing so they will replace the USD Reserve Currency status.

http://militantjeffersonian.com

"We are not a nation, but a union, a confederacy of equal and sovereign States" John C. Calhoun

troll alert.

and good to see you again.
I have a query.

if most currency is digital or "virtual" if you will. 1's and zeros on a computer screen.
might that be the reason hyperinflation has not occurred (yet) from QE?

my query is based upon my understanding that only 3 to 4% of FRN's are in actual paper form.

if, that it is true, why can it not go back to from whence it came?
(thin air)

peace.

Republicae's picture

Hype-inflation of the money

Hype-inflation of the money supply (digital) has already occurred, what we have yet to see is the effects of the massive hyper-inflation in terms of pricing, although I would suggest that we are seeing much, much higher inflation than is officially declared. We tend to associate the term hyper-inflation with the rapid increase in market pricing, that is only the after-effect of hyper-inflation. The monetary hyper-inflation has already taken place, we also tend to think of hyper-inflation in terms of physical currency, that too is not necessarily the case, the effects of monetary mechanisms, whether physical or digital eventually have the same effect on the economy.

The fact is that a government or politically controlled fiat monetary system is naturally inflationary, it always tends to allow the stock of money to grow, usually through bank credit that is always in excess of actual savings. Eventually, of course, the rising money stock pushes the pricing structure in markets. The thing about it is that there is a lax period between the increase in the money stock (physical or digital) and the effects of that increase as seen in prices. The problem is that the issuing agency cannot determine just when that will take place, thus it cannot judge a correct period of curtailment of inflating the money stock. We have seen this occur several times in the boom and burst cycles that are brought about by monetary policy decisions.

http://militantjeffersonian.com

"We are not a nation, but a union, a confederacy of equal and sovereign States" John C. Calhoun

1's and 0's have nothing to

1's and 0's have nothing to do with the issue you're queerying about. long before binary programming language, physical money was a fraction of outstanding credit/debit relationships. the clearing function of banks, as well as double entry bookkeeping and the ledger system from accounting relationships predates ones and zeroes by centuries. even if all computers presently disappeared, the stock of information on credit and debt relationships would have no problem being replicated on paper. your line of questioning is misdirected.

the reason we don't have hyperinflation is because the volume of financial resources being applied to purchasing a stock of available goods in services is not increasing at a rate that would induce such hyperinflation. you are on the right track in one sense. that would be that you recognize on some muddled level that credit/debt ledger notations (double entry bookkeeping) is a sword that cuts both ways, and is not the same phenomenon as a currency collapsing. collapsing currencies are political events attendant with some kind of political unraveling where a government cannot maintain the value of its currency through the legally established demand of forcing people to tender currency as taxes, and can't enforce legal tender laws, i.e., make its currency be accepted and used.

hyperinflation is a phenomenon tied up with collapsing government or some kind of supply side catastrophe that destroys the volume of output or availability of goods while raw money, free and clear of any credit/debit relationship, is injected by the state into the economy through direct spending or transfers to end consumers.

even for a troll i give a free lesson and reserved praise.

Yeah I'm aware of all of

Yeah I'm aware of all of these tentative moves away from the USD, something that's inevitable in the long run. I just don't see how it means the sky is falling, and the markets don't either. America would be better off if it had a weaker currency and relied more on product export and had better industrial policy.

Having the reserve currency was an artifact of a post WW2 and post communist unipolar world that has made us lazy and unfocused on competing economically. It has allowed our internal political dysfunction to grow to obese levels.

But what isn't evident from any of this is that anyone on the world stage wants a rapid, disorderly or catastrophic move away from the dollar as is often hyped or promoted on here. That isn't in anyone's interests.

I think what we'd agree on is that the USG and ruling class of DC will not be able to adapt and handle the transition, there won't be a politically unified and efficient response and management of America's growing internal problems when we are less able to rely on the strength of the dollar in world markets for cheap imports and oil.

But those are internal US political problems more than international economic problems. Germany has fiat money and has industrial policy and central banking, and won't have these problems. These are American political dysfunction problems, not problems of "central banking," "fractional reserve banking," "keynesianism," or "fiat money"

These things can be debated on their own merits, but China and Germany are doing fine taking up the slack as America recedes, and they all have central banking, fiat money and industrial policy.

Republicae's picture

It you were aware of all of

It you were aware of all of these moves then why did you state that you didn’t see any information to justify the claims. If you don’t see the meaning of such a move, a move that, in conjunction with numerous other factors, will create an economic dislocation that will be far greater than anything we have witnessed to date in this or other countries, then there is not much I can say to convince you of the potential for such an event. The markets are currently drunk on the FED QE elixir and have never really been much of a judge of actual economic situations, if it were then it would have reacted to the events leading up to the Panic of 2008, or any other crash. Unfortunately, the last 20 years has seen America’s industrial base exported and decimated, industrial policy and a weaker currency under the fiat monetary system does little to encourage economic growth at this stage of the game. I’m not sure just how much weaker the currency can go, except to zero purchase value. The problem is that under this fiat regime, we have two things going on…the exchange rate and the purchase value of the currency. To weaken the currency on the exchange rate also debases the purchase value.

Actually, the Bretton Woods system was prior to WWII or the post communist world. The arrangement to tie the USD as the Reserve Currency as agreed to in 1944 and went into effect in 1945. Of course, in 1971, the United States unilaterally ceased the convertibility of the Dollar, defaulting on its international obligations and this effectively brought the entire Bretton Woods agreement to an end. It was this action, and not the Reserve Currency status that brought about the political and economic dysfunctional quagmire that we now suffer from.

Oh, I didn’t say nor insinuate that anyone wants a disorderly or catastrophic move away from the dollar, that’s not what I have said, I said that the consequences of such a move will, along with other factors that are occurring in this country, cause a potentially chaotic dislocation that no one is prepared to face. The thing is that all the actors on this stage will act in their own best interest, or what seem to be their own best interests, but those actions will all have consequences, some of which will activate other consequences, some currently can be seen, others cannot be seen.

The problem will come when, as you said, the U.S. Government will react in ways that will seek to contravene the actions of other governments, such as China and Russia. It is within these actions that they possibility for economic calamity exist. Given the complete lack of understanding of the seemingly simplest economic principles in Washington, the possibility of this government, through the actions of the FED, can set the stage for a very real economic disaster.

There is a substantial difference between say the German Central Banking system and the one in the U.S., the German Constitution prohibits the monetizing of debt beyond a certain level, since our government and the FED operate through extra-Constitutional authority, no such limitations exist on the system to which we are subjected. The dysfunction is nor merely a political one, but a monetary one as well, without the fiat monetary USD/USTB system, the political dysfunction would not be possible. This government would be physically limited to tax revenues rather than the unlimited ability of a FED to monetize debt on a scale that is truly unbelievable. I also think you give China and Germany far more credit than is deserved, both economies have their own problems, China more so than Germany, but then again, Germany must deal with the entire EURO debacle. China’s moves seem to indicate that its leadership is very concerned about its own stability. The move toward gold by China might be in response, not only to the overwhelming debt of the U.S. but of its own internal rate of fiat inflation.

http://militantjeffersonian.com

"We are not a nation, but a union, a confederacy of equal and sovereign States" John C. Calhoun

because tarp, maiden lane, et

because tarp, maiden lane, et al are all fed balance sheet, nothing to do with the 16 tril number bandied about. i didn't bring those up because they weren't pertinent to the 16 tril number i responded to. flooding the forum w/ info not relevant to the discuss is pointless.
how about this...
can you list the top ten structural cracks now manifesting in the economy in less space than would cause the little scroll bar on the right hand to be less than half the total length of the visible box.

Republicae's picture

Never said it did, did I? I

Never said it did, did I? I said that there is $16 Trillion dollars in assistance to foreign banks and corporations that does not show up anywhere on the FED Balance Sheet, my question is why doesn't it show up and how has it been accounted for under the FED Charter? If the Audit of the FED's emergency procedures revealed the amount of $16 Trillion then how did it come into being? What was the mechanism used to produce those funds, because normally funds are produced through the purchasing of Treasuries or some sort of "asset"?

You were right, you don't read.

http://militantjeffersonian.com

"We are not a nation, but a union, a confederacy of equal and sovereign States" John C. Calhoun

not sure what tangent we're

not sure what tangent we're on here. i love this stuff and just wna know if you've got something real or just promoting the normal hype. so far seems like the latter, but i'm still open to seeing a short list of the structural cracks currently manifesting, or about the chinese moving to the gold standard, or active steps to get out of t securities, something concrete. if possible in less than1 10k words.

Classic BILL3.

"These are American political dysfunction problems, not problems of "central banking," "fractional reserve banking," "keynesianism," or "fiat money"

The Apple does not fall far from the tree.

Like I said, those things can

Like I said, those things can be debated or discussed on their own merits. But the US reserve currency status and problems attendant to it are not problems shared by other powers like China or Germany which have central banks, industrial protection policy, fiat currency, etc. You're confusing separate issues, as is OP.

Republicae's picture

I happen to be of the

I happen to be of the opinion, based on numerous writings of not only people who knew John M. Keynes personally, but who were very familiar with his political monetary theory that Keynesian or post-Keynesian ideology is indeed a major part of the overall problems we now face. I do not think that many of these issues are isolated or separate, they are interwoven with an structural ideology that influences the whole spectrum of official Western economic thought and action.

Keynesian Economics was created to create problems and not offer solutions. That seems to be a radical statement however, when you judge that statement in the light of the writings of those who knew John Maynard Keynes and his economic theories, it becomes apparent that they were well aware of the effects that Keynesian Economics would have on the well-being of the economy and that those effects would create the need for an ever-increasing amount of government intervention. Perhaps the clearest explanation of the effects of Keynesian Economics can be found in the writings of Keynes’ contemporary and Socialist Comrade John Strachey. Strachey stated that Keynesian Economics was “an indispensable step in the right direction. The fact that the loss of objectivity, and the intrinsic value of the currency which is involved (i.e., inflation) will sooner or later make necessary, on pain of ever- increasing dislocation, a growing degree of social control . . . for the partial character of the policy will itself lead on to further measures. The very fact that no stability, no permanently workable solution can be found within the limits of this policy will ensure that once a community has been driven by events to tackle its problems, in this way, it cannot halt at the first stage, but must of necessity push on to more thorough going measures of re-organization."

It should be very obvious, and irrefutable, that the real purpose of Keynesian Economic Theory was to completely undermine economic stability, thus creating a constant and steady need for government intervention that would eventually destroy the actual free market, leaving no alternatives but a government centered Socialist market economy.

In the book ”The Failure of the New Economics”, Hazlitt stated, correctly, "Keynes's plan for ’the socialization of investment' would inevitably entail socialism and state planning…Keynes, in brief, recommended de facto socialism under the guise of ’reforming' and ’preserving' capitalism." That statement, of course, is in agreement with Strachey’s assessment about what effects Keynesian Economics would have on the substructure, and eventual superstructure of economics.

Strachey again, referring to Keynesian Economic Theory, said: “If once it were admitted that capitalism could be regulated and controlled in this way, might not the wage-earning majority of the population come sooner or later to the conclusion that the thing to do was neither to put up with things as they were nor to go through the fiery furnace of social revolution, in order to establish a wholly new system, but to harness - to bit and to bridle - capitalism in its own interest? Was it not apparent that Keynesism had only to be pushed a little further and a state of things might emerge in which the nominal owners of the means of production, although left in full possession of the legal title to their property, would in reality be working not for themselves, but for whatever hands had grasped the central levers of social control?”

Additionally, Strachey stated: “It is impossible to establish communism as the immediate successor to capitalism. It is accordingly proposed to establish socialism as something, which we can put in the place of our present decaying capitalism. Hence, communists work for the establishment of socialism as a necessary transition stage on the road to communism.”

Thus, according to Strachey, the goal has been to gradually introduce Socialist mechanisms within the capitalist market systems through degenerative measures [such as Keynesian Economic Theory] that would increasingly promote government intervention in the markets. This has indeed happened over the last seventy-some-odd-years, and today we are seeing an even greater push by government in a response to this latest dislocation in the economy, as predicted by Strachey, as well as other Socialists.

It becomes apparent that one of the goals of Keynesian Economic Theory is the transformation of a free market economy into an official government economy. Indeed, if we look at the effects of Keynesian Theory on the actual monetary and economic policies executed in this country over the decades it becomes easy to see that this particular theory has eliminated the normal market mechanics for artificially induced and managed market mechanics. You will notice that over the years the savings rate in this country has gradually deceased, consumption, driven by debt, has increased and during this process the government has drastically increased its power over the economy. Due to various mechanisms within Keynesian Economics, in particular the enforced use of Fiat Money, private monies for investment has gradually dwindled while government monies have increased. Without private monies there is no other way for the markets to be maintained other than through public funding, thus the government must intervene and provide capital in the markets, as we have seen. At this stage, once the government infuses public funding, it has the power, as we see, to dictate not only conduct within the market, but also the various processes involved in business decisions.

John Maynard Keynes was closely associated with various Socialist groups; in fact Keynes once described himself as a Bolshevik and was well aware of Socialist doctrine and theory. Keynes, in his book “Economic Consequences of the Peace”, stated: "By a continuous process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method, they not only confiscate, but they confiscate arbitrarily; and while the process impoverishes many, it actually enriches some.... The process engages all of the hidden forces of economic law on the side of destruction, and does it in a manner that not one man in a million can diagnose."

Indeed, Nikolai Lenin spoke before the Second Congress of the Communist International and declared of Keynes: “I will quote another economic source which assumes particularly great significance, the British diplomat Keynes, the author of The Economic Consequences Of The Peace, who on the instructions of his government, took part in the Versailles peace negotiations, watched them directly from the purely bourgeois point of view, studied the subject step by step, and took part in the conference as an economist. He arrived at conclusions which are stronger, more striking and more instructive than any a Communist revolutionary could advance, because they are conclusions drawn by an acknowledged bourgeois....”

The political economic nature of Keynesian Economics cannot be denied, nor can the effects of those theories on the entire economic and social structure of our government. Keynes, in a letter to fellow Socialist George Bernard Shaw, said: “I believe myself to be writing a book on economic theory which will largely revolutionize ... the way the world thinks about economic problems. When my new theory has been duly assimilated and mixed with politics and feelings and passions, I can’t predict what the final upshot will be in its effect on actions and affairs. But there will be a great change, and in particular the Ricardian foundations of Marxism will be knocked away.”

Geoffrey Pilling, a Marxist, wrote of the effects of Keynesian Economic Theory on the Western Capitalist Societies saying: “It [the West] accepts Keynes’ own belief in the primacy of ideas in the shaping of state economic policy. An examination of the development of the role of the state indicates that there is an organic trend towards ever-greater state involvement in the attempted regulation of economic and social matters. It concurs with Keynes’ own judgment about the significance of his work: namely that it did in fact constitute a revolution in economics. We have already noted that there is little if any agreement amongst those who would wish to be labeled Keynesians about the nature of this revolution.”

http://militantjeffersonian.com

"We are not a nation, but a union, a confederacy of equal and sovereign States" John C. Calhoun

Republicae's picture

Let us then take a look at

Let us then take a look at what has been taking place; the best place to begin is with none other than the Federal Reserve System. As of November 6, 2013, the Balance Sheet of the FED rests at 3,894,129 MILLION DOLLARS. Now, that figure is very interesting is that during the Panic of 2008, it appears that the FED did some very odd and illegal activities that don’t show up on the FED balance sheet. There was, according the a 2011 article in Forbe’s Magazine there was a minor audit of the FED’s emergency lending programs during the Panic, we heard little about it however, but that all-important audit verified that the FED has issued over $16 Trillion Dollars and allocated that money to various foreign banks and corporations. Now, remember the FED balance sheet is only $3.8 Trillion, where did that $16 Trillion come from and how is it accounted for in the FED books or on government Treasury accounts? The answer is that it isn’t! This fact is a biggie in terms of what is taking place and what is about to take place within this economic and monetary system.

Now, there is another interesting fact that no one has seemed to question and that was what took place in September, 2001, because on September 10, 2001 Donald Rumsfeld stated the following: “According to some estimates, we cannot track $2.3 Trillion dollars in transactions.” Naturally, the common question was what happened to the money, but the more important question was where did that amount of money come from in the first place? In 2001, the Pentagon Budget was $305.4 Billion dollars. Nor does the $2.3 Trillion Dollars show up anywhere afterwards on any of the outlays of the Pentagon Budget, nor on the FED’s balance sheets, nor on any government account. So, where did it come from, that is the most important question to be asked?

These are hidden factors that cannot be accounted for in terms of the effect they might have. We have several “knowns” within this economic paradigm, such as the massive $17 Trillion Dollar Debt and the approximate $222 Trillion Dollars in unfunded future obligations, but there are the “unknowns”, those like the examples I stated above that are floating behind the scenes of this economy, without any tracking or accountable knowledge of how that massive amount of funds is acting within the global economy.

Now, it is estimated that the global worth is about $80 Trillion, that is an amazingly small amount of money when we consider that the derivative positions are estimated at $1.6 Quadrillion, or $1600 Trillion Dollars. Back in 2004, Nassim Taleb wrote a book entitled Fooled by Randomness. In it he stated, even then, that: "Banks and trading firms are especially vulnerable to hazardous black swan events and are exposed to losses beyond those predicted by their defective models." That proved accurate in 2008, but that does not mean that anything has been solved, in fact, nothing has been solved, for today things are in a far worse condition then they were in the years leading up to 2008. While it is normally concluded that Black Swan events may or may not occur at any time, the problem is that the likelihood within our current economy, especially with the actions being taken behind the scenes with the FED, that the possibility of such an event taking place, on a massive scale, is even far greater than it was prior it was in 2008. I see the possibility of a number of small events taking place, events that weaken the already weakened links within this system and as a result, set the stage for a truly massive event that will break the back of the monetary system.

Recently, we have seen the real possibility of a failure to deliver on certain Comex contracts, like gold and silver. It would not take much for such an event to occur, especially if there is even a minor economic shock that would cause enough fear to grip the holders of those contracts to wish to take actual physical delivery. The failure to deliver would instantly become a systemic collapse in confidence, not merely in the Comex, but in other markets leading to a massive sell-off and it would essentially shut down the markets, but things like that can easily lead to a systemic collapse of everything, like the credit markets, if the credit markets crash then we will see the collapse of the Global Supply Chain, once that happens it’s all over.

As far as evidence goes, look at the FED balance sheet, look at the Open Market Operations when Treasuries are auctioned off, see who is buying them and at what level those Treasuries are being sold or bought by the FED. Look at what China, Russia and even India are doing in the gold market. Look at the Stock Market and it's astounding new highs....that should give you a few dots to start on, connect them and you will find that there are numerous things on the scenes and behind the scenes occurring, many of which are not only questionable, but seem to point to some very pressing threats to the current economic, monetary and even the banking systems.

Let us then take a look at what has been taking place; the best place to begin is with none other than the Federal Reserve System. As of November 6, 2013, the Balance Sheet of the FED rests at 3,894,129 MILLION DOLLARS. Now, that figure is very interesting is that during the Panic of 2008, it appears that the FED did some very odd and illegal activities that don’t show up on the FED balance sheet. There was, according the a 2011 article in Forbe’s Magazine there was a minor audit of the FED’s emergency lending programs during the Panic, we heard little about it however, but that all-important audit verified that the FED has issued over $16 Trillion Dollars and allocated that money to various foreign banks and corporations. Now, remember the FED balance sheet is only $3.8 Trillion, where did that $16 Trillion come from and how is it accounted for in the FED books or on government Treasury accounts? The answer is that it isn’t! This fact is a biggie in terms of what is taking place and what is about to take place within this economic and monetary system.

Now, there is another interesting fact that no one has seemed to question and that was what took place in September, 2001, because on September 10, 2001 Donald Rumsfeld stated the following: “According to some estimates, we cannot track $2.3 Trillion dollars in transactions.” Naturally, the common question was what happened to the money, but the more important question was where did that amount of money come from in the first place? In 2001, the Pentagon Budget was $305.4 Billion dollars. Nor does the $2.3 Trillion Dollars show up anywhere afterwards on any of the outlays of the Pentagon Budget, nor on the FED’s balance sheets, nor on any government account. So, where did it come from, that is the most important question to be asked?

These are hidden factors that cannot be accounted for in terms of the effect they might have. We have several “knowns” within this economic paradigm, such as the massive $17 Trillion Dollar Debt and the approximate $222 Trillion Dollars in unfunded future obligations, but there are the “unknowns”, those like the examples I stated above that are floating behind the scenes of this economy, without any tracking or accountable knowledge of how that massive amount of funds is acting within the global economy.

Now, it is estimated that the global worth is about $80 Trillion, that is an amazingly small amount of money when we consider that the derivative positions are estimated at $1.6 Quadrillion, or $1600 Trillion Dollars. Back in 2004, Nassim Taleb wrote a book entitled Fooled by Randomness. In it he stated, even then, that: "Banks and trading firms are especially vulnerable to hazardous black swan events and are exposed to losses beyond those predicted by their defective models." That proved accurate in 2008, but that does not mean that anything has been solved, in fact, nothing has been solved, for today things are in a far worse condition then they were in the years leading up to 2008. While it is normally concluded that Black Swan events may or may not occur at any time, the problem is that the likelihood within our current economy, especially with the actions being taken behind the scenes with the FED, that the possibility of such an event taking place, on a massive scale, is even far greater than it was prior it was in 2008. I see the possibility of a number of small events taking place, events that weaken the already weakened links within this system and as a result, set the stage for a truly massive event that will break the back of the monetary system.

Recently, we have seen the real possibility of a failure to deliver on certain Comex contracts, like gold and silver. It would not take much for such an event to occur, especially if there is even a minor economic shock that would cause enough fear to grip the holders of those contracts to wish to take actual physical delivery. The failure to deliver would instantly become a systemic collapse in confidence, not merely in the Comex, but in other markets leading to a massive sell-off and it would essentially shut down the markets, but things like that can easily lead to a systemic collapse of everything, like the credit markets, if the credit markets crash then we will see the collapse of the Global Supply Chain, once that happens it’s all over.

Now, let’s look at the various “too big to fail” banks, they are much bigger now then they were prior to 2008. The largest banks are now 37 percent larger than they were in 2008. During the process, since that time, over 1400 banks have gone out of business. Thus, JPMorgan Chase, Bank of America, Wells Fargo, Citigroup, Goldman Sachs and Morgan Stanley are now the linch-pin of American economic health and that should call into question just what is the health of those banks. These banks control a whopping 67% of all banking assets in this country. Bank of America alone accounted for a third of all business loans in this country last year. Now, when we consider that our economy is based on credit/debt and these 6 banks are essentially in control of the majority of the mechanisms involved with the credit/debt economy, then there is a very real danger that if one gets into trouble, the entire banking system in this country will be at risk.

The big banks knew that they were “too big to fail”, but if it occurs again, and I firmly believe there are indicators that point to that being a very real possibility, the collapse of one of those banks would be enough to crush the economy, but even a bailout would be enough to place such a damper on the economy, not only for economic reasons, but for political reasons. Of course, politicians have said that the have fixed the problems that lead to the Panic of 2008, but the truth is that nothing has been done to repair or set into place a credible risk management plan within the banking sector. If we look at the assets of a few of these banks we see that the increase has been massive, prior to 2008 Wells Fargo was at $609 Billion, today it is at $1.4 Trillion, Bank of America was at $1.7 Trillion, today it is at $2.1 Trillion. JP Morgan, which is now about the size if the entire British economy, went from $1.8 Trillion up to $2.4 Trillion. Even if the government wanted to bail them out, at this point it would not only be virtually impossible, but it would reek such havoc in the economy that even the thought of doing it would be dangerous. In other words, we will be damned if we do and damned if we don’t, either way we would be screwed.

I could go on and on about the subject, but my old fingers have grown weary tonight.

http://militantjeffersonian.com

"We are not a nation, but a union, a confederacy of equal and sovereign States" John C. Calhoun

to your first paragraph,

to your first paragraph, those big numbers are just the notional values for some kind of verbal guarantee and doesn't involve any actual money. if i guarantee your solvency with a signature, up to a million, and you have assets that at worst could go for 900k, i haven't created any money, let alone the whole million. these are just misunderstandings.

to your second para, i am aware of those news stories on the missing trillions, but they have not been resolved or led to any concrete answers, and don't have any bearing on any prior points of discussion. to your question how could trillions be unaccounted for with a budget in the millions, i would suggest you're mixing up the concept stocks and flows. over 3 decades annual flows in the billions (budget) can accrue waste or losses in the trillions. but this is all speculation without concrete data.

to your third para, the unfunded liabilities aren't real financial obligations, they aren't legally enforcable promissory notes, they are just promises of entitlements. to treat them with the actuarial standards of a private sector contract just muddles the issue. if they can't be paid, they won't, and there is no legal issue. the same is somewhat true of treasuries. as sovereign debt, there is no reason to view them as legally enforcable liabilities. they might just not pay them, or they might pay them and tax the proceeds. they might slowly inflate them away. no one in china is forced to buy treasuries, its their free choice. no promise has been made to pay any treasury holder in gold or in constant dollars. those promises were broken in 33 and 71, and we have fiat now.

to your fourth para, i think you're confusing stocks and flows again as financial concepts. the 80 trillion number is an estimate of world gdp, which is a flow, an annual income flow. it isn't a value of the stock of capital or of currency or some other concept. the value of all capital stock, all human capital, impossible to gage, and these are fleeting numbers that aren't measured by a stable yardstick. on derivatives, those again are notional values. when they cite the outstanding derivatives in notional value, they're giving you the value of the financial security underlying the derivative contract. this does not mean there is 1600 trillion new dollars around... these contracts would just default if they couldn't be paid, and nothing much would happen to capital stock. and the underlying real securities aren't going to go to zero.

i have to admit i stopped reading after the fourth paragraph, because you had not provided any information on your previous claims, which i asked for, and you made 3 or 4 major elementary mistakes. and i was less than half way through!

Republicae's picture

You really haven’t been

You really haven’t been keeping up with the financial world, have you? Have you ever heard of TARP, QE1, QE2, QE3, Operation Twist, Maiden Lane I, Maiden Lane II, Maiden Lane III or TALF?
What an interesting concept you have that those are only notional values however, those values are not simply some theoretical value according to the FED balance sheets and they are not simply a guarantee, the vast majority of listed assets on the balance sheets are in the form of U.S. Treasuries, also purchased by the FEDs Maiden Lane I, Maiden Lane II, Maiden Lane III LLC and the TALF LLC largely consist of mortgage-related debt securities, whole mortgage loans credit default and interest rate swap contracts. Now, those listed under the consolidated LLC system they call Maiden Lane, are primarily bailouts. Obviously, the money that was created by both the purchase of U.S. Treasuries and the LLC system went somewhere, but if it is only nominal values as you assert, then what was the purpose of just going through the motions?
Not to mention the ongoing infusion of $85 Billion per month that I suppose could be called yet another QE. So, how does the FED do it? The FED writes a check on its own account that doesn’t have a single dollar on deposit, but it buys various “assets”, like Treasuries, and Toxic Assets, etc. When the FED buys such assets, what do you think happens to the money that is created? Do you really think it is simply nominal values, hen scratching on a computer screen? No, those checks are deposited into commercial banks on top of the base of existing reserves, which are demand deposits at the FED. What are those reserves used for, well it what we could call checkbook money, upon which commercial banks can multiply the creation of money through loans. These are not simply nominal values, nor a type of guarantee as you suggest.
Concerning the $2.3 Trillion in missing transactions, it was not simply the accrual of losses or waste over a few decades, but it was $2.3 Trillion missing transactions, the concern was not a decade or more in the making, it was that there was no record of what happened to an amount of money that not only exceeded the total budget of the Pentagon, but exceeded the entire budget of the Federal government, that budget was only $1.8 Trillion Dollars in the year 2000. It was common knowledge that, through the years, the Pentagon could not account for approximately 25% of its spending, but this was different. It’s sorta like when 12 to 18 Billion Dollars in shrink-wrap disappeared later in Iraq…just vanished without a trace.

So, Social Security, Medicare, Medicaid are not legally enforceable promissory notes, but they do form a social contract made between this government and its people, that social contract was encoded into law. We can treat them with the same actuarial standards as in the private sector any more than anything else in the government, that’s not the point; the point is that they are obligations of this government. Obligations, if unpaid could easily lead to civil unrest, a dramatic breakdown of society. Hell, just think about what happened when the EBT payment system stopped working for a few hours.

I think, based on your comments, it is you who are confused, I was making a comparison of the global GDP and the amount of the Derivatives market. Remember, I said the worth of the global economy, not an amount of money. Nor did I say that the 1600 Trillion was in the form of new dollars rolling around the globe, I stated that was the estimated amount of those contracts.

http://militantjeffersonian.com

"We are not a nation, but a union, a confederacy of equal and sovereign States" John C. Calhoun

i was referring to the oft

i was referring to the oft cited 16 trillion figure as being some tally of guarantees that will never represent actual financial assets. i am of course ware of all those things you listed in the beginning that's very old news. i thought maybe there was something new. particularly something new wrt to the dollar or t securities getting dumped in asia or mideast, as was the theme of much of the article. you also made baseless (imo) claims about china going to a gold standard. cite the sources.

global gdp is not "the worth of an economy" its one year's income flow. so unless all the capital stock of the world is producing a return equal to 100% of its capital value per annum, the global capital stock would be worth many many multiples of its gdp. as everyone knows, the vast majority of income producing assets in the world are valued at many times their annual earnings, and so the whole global capital stock would have the same relationship to annual gdp. citing spooky notional derivative values and juxtaposing it with a false claim that the economy is only worth 80 tril is not good story telling.

as for fed policies like qe... its very debatable what effect if any that's having, whether removing interest income from treasury holders is outweighing any increase of credit from the lower rates in our debt saturated private sector. the balance sheet ops of the fed and excess reserves have no mechanical conduit to adding any real spending power... hence the absence of the inflation.

Republicae Sorry, but I have to agree with Bill on this one.

And Bill just fell out of his chair!

But he is right in these remarks,

Regarding derivatives

those big numbers are just the notional values for some kind of verbal guarantee and doesn't involve any actual money.

news stories on the missing trillions

I know the source of these so called “missing trillions”, these were currency swaps again quoted in “notional” values

Ok now that Bill’s off the floor, he can resume the conversation.

not sure i get the

not sure i get the chair/floor metaphor.

Just speaking to the fact that i have agreed

with you given our past. I thought you might be floored.

ohhh i got it now. well,

ohhh i got it now. well, everyone comes around eventually.

Now that’s the Bill I know.

It’s more like this Einstein.

Sure you have heard the allegory of the three baseball umpires.
They all asked the same question. How do you know what to call a ball or a strike?

One says “Well I call it what I think it is”

Another says “I call it what I want it to be”

The last one says “I call it what it is”

I am a third umpire. every once in a while everyone throws a strike.
So I knew you would finally get around to saying something correct sooner or later.

shouldve stopped with thats

shouldve stopped with thats the bill i know. sometimes silence is better.

I'm just yanking your chain man.

SSSSSSSSSSSSSHHHHHHHHHH

Republicae's picture

What I was citing was the

What I was citing was the mechanism behind the $16 Trillion in loans, not only in currency swaps, that the FED provided to domestic banks, foreign banks and corporations, it is not found anywhere on the FED Balance sheet, no matter what form that assistance took, the question is what was the mechanism by which they effected such assistance?

That was essentially the question when the GAO Audit of the FEDs emergency measures was completed.

Here is the list of the benefactors of this program:

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

Again, my question is, just as Dr. Ron Paul asked, where did it come from? In other words, what was the mechanism by which the FED created the funds to lend since they don't appear anywhere on the balance sheet?

http://militantjeffersonian.com

"We are not a nation, but a union, a confederacy of equal and sovereign States" John C. Calhoun

Hey I found the information

I have seen this exact information; the original source was Senator Bernie Sanders Vermont a self-described democratic socialist. I will find my former post and repost it.

Hey I found it, I was questioning Mark Twain when he posted the same information.

When you Google “GAO 16 trillion”……all the stories source Sanders and the 16 trillion figure.

As far as the press goes…….come on man……those people only know what other people tell them. They don’t really know anything, they are supposed to have checked this stuff out, but their source on this was Sen. Bernie Sanders from Vermont………that guy is a nut.

Note: The total dollar amounts borrowed represent the sum of all loans and have not been adjusted to reflect differences in terms to maturity for the loans. Total borrowing is aggregated at the parent company level and generally includes borrowing by branches, agencies, subsidiaries, and sponsored ABCP conduits that we could identify. Total borrowing for each parent company consolidates amounts borrowed by acquired institutions following the completion of acquisitions. PDCF totals includes credit extensions to affiliates of some primary dealers and TSLF totals include loans under the TSLF Options Program.

To account for differences in the terms for loans that were outstanding, we multiplied each loan amount by the number of days the loan was outstanding and divided this amount by the number of days in a year (365). Table 9 shows the top 20 borrowing institutions in terms of term adjusted total transaction amount for emergency programs and other assistance provided directly to institutions facing liquidity strains.

This tells me that the loans were re-purchase agreement backed by some collateral provided by the banks and there were many many re-purchase agreements of varying lengths and amounts with the total loan amount only being approx.. 6% of the sensationalize number……I believe that Mr. Sanders has a motive to misinform people…….don’t you think?

http://www.sanders.senate.gov/newsroom/press-releases/the-fe...

Question

This is the second time I have seen you use the term “bankster”. I am wondering why you use this term. The context is usually inferring that someone believes in the “international banking conspiracy”. Is this your position?

Here are my positions.
I don’t believe in the “international banking conspiracy” as it started with Jesus turning over the “money changers” tables in the Temple for charging usury to world domination by the evil bankers.

I think that bankers have a role in the evolution of the State. The concept of the State starting in Athens with Plato to where we are today. I do not think that this is some conspiracy or reality to world domination or the coming of the “End of Days” as told by the book of Revelation.

I think that some bankers have a tendency to use the State to advance their position just like other business men do; it’s just a closer symbiotic relationship then other businessmen.

Here is a quote from Rothbard:
Business men can either be genuine free enterprisers or statists; they can either make their way on the free market or seek special government favors and privileges. They choose according to their individual preferences and values. But bankers are inherently inclined toward statism.

But citizen do not have a contract with the Bankers to look after the citizens best interest, but we do with the Politicians, so who is really to blame? Bankers are businessmen and some wish to us the State to gain an edge in the world and some are crooks, but banking in general is not an evil.

All Politicians advance their own position in the world using the State and government, as some tell me is a necessary evil……isn’t that an oxymoron?

So these conspirators must be really inept. I mean really…..2500 years and they still have completed the job….what are they…..government employees!

I don’t believe in an intergenerational conspiracy to take over the world but I do believe there have been generational tendency of the path of least resistance to ill-gotten gains. Do I think men have conspired to obtain these ill-gotten gains, yes, do I think their goal is to take over the world, no. The concept of any empire is to always seek more at the least cost (whether financial or human capital), but all Empires have failed and usually from within.

Will we make a run at a one world government….Yes we will, but it is the evolution of the State with their tools of the Inflationist. As each monetary system fails, the natural course is the inflation of the next system and the next system will either be a China Reserve Currency System or a World Currency System, the Bancor like Keynes wanted at Bretton Woods. It will be the same dollar exchange system we have now, just a different reserve currency.

And as weak-minded as most Americans are they will give up there Liberty for Security and comfort just like the States did in 1787.

Really most interested in your conspiracy thoughts….Thanks

Republicae's picture

No, my position is that due

No, my position is that due to the immense power association between the governments of the world and the central banking system that Banks share in the political corruption that seemingly prevails globally. While I was, at one time, leaning toward a more conspiratorial outlook, that changed drastically a few years ago when I realized that there were too many holes within the entire international banking conspiracy theory. While there may well be elements that can be, by definition, conspiratorial, like you I tend to take a less conspiracy theory view of history. I

I hold the position that central banks are political constructions that benefit the expansive power of the STATE through a corrupt monetary and financial structure. The seemingly unlimited powers usurped by the government, in particular our government, in the last Century have only been possible through the facility of central banking and the fiat currency system that has been implemented, not merely by banking, but by elements of political power.

Rothbard is correct by the way, but I think it is even more involved than he asserted. Since I feel that the central banking system is primarily a political construction, the relationship between banking and government is far more invasive than if it were simply a business advantage.

I also hold the view that the conspiracy theories about the NWO and the various other theories give far too much credit to those we call the elite, like you said, it really appears to be a vast conspiracy of ineptitude, more than anything else. I’ve heard of theories that the EURO crisis is just part of the plan, but then again, if you look at the history of the EURO and the EURO Zone, and you read about those who spent decades to craft, form and implement that system, then you see that it would neither be logical or beneficial for their plans to include a collapse of that system. I think the evidence is that those that crafted, formed and implemented it didn’t understand the nature of the plans, nor the implications of all the elements that were involved, nor did they know enough to craft the system in a way that could prevent failure. You cannot create massive distortions within an economy and not expect the laws of economics to kick back when those laws are broken. Not only that, but they severely discounted human action, as well as human nature.

http://militantjeffersonian.com

"We are not a nation, but a union, a confederacy of equal and sovereign States" John C. Calhoun

At this point in our history ....

assuming that the status quo does what it does best, maintain the status quo, and the dollar remains the reserve currency and global currencies continue to ease at a relatively even rate ...

There will be no price hyper inflation.

Commodity prices will continue to inflate at a sustainable rate and the value of labor will continue to decrease slowly and steadily until there is a breaking point.

That breaking point is the key. If the internet remains relatively free from restraints and cost ...

We may witness the first relatively peaceful global revolution.

That needs to be our focus.

God Bless.

"Fortunately, deep structural crack up ahead." - N. Boneparte

"We'll weather this storm there."

Disclaimer: Mark Twain (1835-1910-To be continued) is unlicensed. His river pilot's license went delinquent in 1862. Caution advised. Daily Paul