A Visual Guide to the Financial Crisis
WallStats.com
Nov 13, 2008
http://blog.mint.com/blog/finance-core/
a-visual-guide-to-the-financial-crisis/
Almost overnight, the talking heads went from perpetuating the euphoria of investors to rushing to pronounce the economy dead. Last year, when lenders started dropping like flies as foreclosures rose and margins were called, the problems of Wall Street became more and more apparent, and lending guidelines were tightened to the point that many individuals were stuck in their time-bomb loans, and thus began a vicious cycle. But what led to this? Here is a visual guide to help you understand the events leading up to the bailout.
Click here for the Source Article
Saturday, November 15, 2008
Friday, November 14, 2008
Why Gold Might Soar Over the Next Four Weeks
Why Gold Might Soar Over the Next Four Weeks
Patrick A. Heller
Oct 28, 2008
http://www.numismaster.com/ta/numis/
Article.jsp?ad=article&ArticleId=5514
Whether or not you acknowledge past efforts by the U.S. government with other governments, central banks and private trading partners to suppress the gold spot price, events coming to pass in the next four weeks could create overwhelming pressure causing much higher gold prices.
Last Friday, the Taiwan government announced that it had completely liquidated its holdings of Fannie Mae, Freddie Mac and Ginnie Mae bonds. If a long-time ally of the United States is willing to admit that it is bailing out of dollar-denominated debt, will other nations continue to show restraint?
Last Friday and Saturday, leaders from 43 Asian and European nations met in Beijing to discuss the global financial crisis. The United States was specifically excluded from this meeting.
These events are just appetizers on what is coming up in the next few weeks:
- Oct. 28: Comex November gold and silver options expire.
- Oct. 28-29: The Federal Open Market Committee meets to discuss, among other subjects, the possible 0.5 percent reduction in benchmark interest rates.
- Oct. 29: Last trading day for COMEX and Chicago Board of Trade gold and silver futures contracts.
- Nov. 4: The U.S. elections will be held and end the need for politicians seeking re-election to try to look good for the voters.
- Nov. 6: European Central Bank meeting at which one of the subjects will be cutting benchmark interest rates.
- By Nov. 10: Adrian Douglas's Market Force Analysis" indicates that the temporary bear market rally in the value of the U.S. dollar will come to an end.
- Nov. 15: The G-8 summit meeting in New York City will discuss plans to reform the international financial and monetary system. There is a strong likelihood that one of the major topics will be the replacement of the U.S. dollar as the major international currency.
- Nov. 20: December gold options expire. Currently, there are about 70 percent more outstanding call options (which gives the owner the right to buy gold at the contract price) than there are put options (which give the seller the right to sell gold at the contract price). If the price of gold starts to rise to any degree, owners of call options might be able to demand physical gold for their contracts at below-market prices. Thus, any modest rise in gold prices could lead to an extreme supply squeeze and rocketing prices.
Other continuing pressures for higher precious metals prices include:
- The TOCOM, the Tokyo Commodities Exchange, provides daily reports of trading positions for major traders. Goldman Sachs and six other firms had huge short gold positions in early 2006. Goldman Sachs and these others have been continuously reducing their short positions. Late last week, Goldman Sachs TOCOM gold position turned into a net long of 370 contracts. The other large short sellers as a group are in their lowest short position in the past 30 months. These companies now have less incentive to want to hold down gold prices.
- There is a significant effort underway by would-be gold and silver buyers, dismayed by the current high premiums for physical gold and silver to purchase December COMEX contracts and ask for physical delivery of the 100-ounce gold and 1,000-ounce silver ingots. Since the COMEX only has a tiny coverage of physical metal for its outstanding contracts, there is a growing risk that the COMEX gold and silver contracts may default. If this occurs, the COMEX allows contracts to be settled for cash rather than gold or silver. If defaults occur, the spot prices for physical gold and silver will soar instantly.
- AIG, America's largest insurance company and beneficiary of over $100 billion in government liquidity over the past six weeks, is still at great risk of financial collapse. From a high of $63.68 per share within the past year, the stock settled at $1.35 on Oct. 27. AIG is widely regarded as holding the largest number of gold and silver derivatives (especially silver) of any company in the world. If it fails, the counterparties on these derivatives contracts could be forced to quickly acquire large quantities of gold and silver to minimize their financial losses.
It would only take one or a few of these events to get out of control for the prices of gold and silver to explode.
The U.S. government and its partners are pulling as many strings as it can to try to hold down prices. A large number of 400-ounce gold bars have been appearing on the market with markings that indicate that they may either be coming from the U.S. Treasury or International Monetary Fund reserves. The IMF is not yet authorized to sell any gold, but apparently can lease gold without restriction. If it becomes public knowledge that the U.S. or the IMF is sneaking gold onto the market to help hold down prices, the news will actually have the opposite effect because it would represent an admission that the U.S. dollar deserves to be worth much less than it is today.
For other news and articles on NumisMaster.com, Click Here.
Patrick A. Heller
Oct 28, 2008
http://www.numismaster.com/ta/numis/
Article.jsp?ad=article&ArticleId=5514
Whether or not you acknowledge past efforts by the U.S. government with other governments, central banks and private trading partners to suppress the gold spot price, events coming to pass in the next four weeks could create overwhelming pressure causing much higher gold prices.
Last Friday, the Taiwan government announced that it had completely liquidated its holdings of Fannie Mae, Freddie Mac and Ginnie Mae bonds. If a long-time ally of the United States is willing to admit that it is bailing out of dollar-denominated debt, will other nations continue to show restraint?
Last Friday and Saturday, leaders from 43 Asian and European nations met in Beijing to discuss the global financial crisis. The United States was specifically excluded from this meeting.
These events are just appetizers on what is coming up in the next few weeks:
- Oct. 28: Comex November gold and silver options expire.
- Oct. 28-29: The Federal Open Market Committee meets to discuss, among other subjects, the possible 0.5 percent reduction in benchmark interest rates.
- Oct. 29: Last trading day for COMEX and Chicago Board of Trade gold and silver futures contracts.
- Nov. 4: The U.S. elections will be held and end the need for politicians seeking re-election to try to look good for the voters.
- Nov. 6: European Central Bank meeting at which one of the subjects will be cutting benchmark interest rates.
- By Nov. 10: Adrian Douglas's Market Force Analysis" indicates that the temporary bear market rally in the value of the U.S. dollar will come to an end.
- Nov. 15: The G-8 summit meeting in New York City will discuss plans to reform the international financial and monetary system. There is a strong likelihood that one of the major topics will be the replacement of the U.S. dollar as the major international currency.
- Nov. 20: December gold options expire. Currently, there are about 70 percent more outstanding call options (which gives the owner the right to buy gold at the contract price) than there are put options (which give the seller the right to sell gold at the contract price). If the price of gold starts to rise to any degree, owners of call options might be able to demand physical gold for their contracts at below-market prices. Thus, any modest rise in gold prices could lead to an extreme supply squeeze and rocketing prices.
Other continuing pressures for higher precious metals prices include:
- The TOCOM, the Tokyo Commodities Exchange, provides daily reports of trading positions for major traders. Goldman Sachs and six other firms had huge short gold positions in early 2006. Goldman Sachs and these others have been continuously reducing their short positions. Late last week, Goldman Sachs TOCOM gold position turned into a net long of 370 contracts. The other large short sellers as a group are in their lowest short position in the past 30 months. These companies now have less incentive to want to hold down gold prices.
- There is a significant effort underway by would-be gold and silver buyers, dismayed by the current high premiums for physical gold and silver to purchase December COMEX contracts and ask for physical delivery of the 100-ounce gold and 1,000-ounce silver ingots. Since the COMEX only has a tiny coverage of physical metal for its outstanding contracts, there is a growing risk that the COMEX gold and silver contracts may default. If this occurs, the COMEX allows contracts to be settled for cash rather than gold or silver. If defaults occur, the spot prices for physical gold and silver will soar instantly.
- AIG, America's largest insurance company and beneficiary of over $100 billion in government liquidity over the past six weeks, is still at great risk of financial collapse. From a high of $63.68 per share within the past year, the stock settled at $1.35 on Oct. 27. AIG is widely regarded as holding the largest number of gold and silver derivatives (especially silver) of any company in the world. If it fails, the counterparties on these derivatives contracts could be forced to quickly acquire large quantities of gold and silver to minimize their financial losses.
It would only take one or a few of these events to get out of control for the prices of gold and silver to explode.
The U.S. government and its partners are pulling as many strings as it can to try to hold down prices. A large number of 400-ounce gold bars have been appearing on the market with markings that indicate that they may either be coming from the U.S. Treasury or International Monetary Fund reserves. The IMF is not yet authorized to sell any gold, but apparently can lease gold without restriction. If it becomes public knowledge that the U.S. or the IMF is sneaking gold onto the market to help hold down prices, the news will actually have the opposite effect because it would represent an admission that the U.S. dollar deserves to be worth much less than it is today.
For other news and articles on NumisMaster.com, Click Here.
Thursday, November 13, 2008
Surviving the “Contained Depression”
Surviving the “Contained Depression”
Paul Kedrosky
Nov 11, 2008
http://paul.kedrosky.com/archives/
2008/11/11/surviving_the_c.html
Interesting David Levy piece in the current issue of Institutional Investor. Here is the money ‘graf(s):
Without the government’s containment the economy would indeed ace another Great Depression, but fortunately, nothing so dire will occur. The government will prevent a collapse of the financial system and partially buffer the damage to the economy, containing the depression. The government will succeed not because it is wise about economic affairs or because it won’t make mistakes. Rather, it will have no choice but to keep patching holes in the financial sector, and its sheer size and presence guarantee a sizable fiscal stabilization. The government has virtually unlimited power to intervene to protect the basic functioning of the financial system, and in an emergency can spend whatever is necessary. Although government solutions will not fix the fundamental problems that will cause the depression, they will limit the financial fallout. By the end of the contained depression, the government will likely have committed trillions between rescue operations and running huge deficits. And although some may complain about the price tag, it will be a bargain for enabling us to avoid another Great Depression.
Levy thinks we will be out the other side in late 2009 or early 2010, albeit out in a tepid way.
Paul Kedrosky
Nov 11, 2008
http://paul.kedrosky.com/archives/
2008/11/11/surviving_the_c.html
Interesting David Levy piece in the current issue of Institutional Investor. Here is the money ‘graf(s):
Without the government’s containment the economy would indeed ace another Great Depression, but fortunately, nothing so dire will occur. The government will prevent a collapse of the financial system and partially buffer the damage to the economy, containing the depression. The government will succeed not because it is wise about economic affairs or because it won’t make mistakes. Rather, it will have no choice but to keep patching holes in the financial sector, and its sheer size and presence guarantee a sizable fiscal stabilization. The government has virtually unlimited power to intervene to protect the basic functioning of the financial system, and in an emergency can spend whatever is necessary. Although government solutions will not fix the fundamental problems that will cause the depression, they will limit the financial fallout. By the end of the contained depression, the government will likely have committed trillions between rescue operations and running huge deficits. And although some may complain about the price tag, it will be a bargain for enabling us to avoid another Great Depression.
Levy thinks we will be out the other side in late 2009 or early 2010, albeit out in a tepid way.
Wednesday, November 12, 2008
Georgia congressman warns of Obama dictatorship
Georgia congressman warns of Obama dictatorship
The Revealer
Nov 10, 2008
http://www.abovetopsecret.com/forum/thread410524/pg1
Broun cited a July speech by Obama that has circulated on the Internet in which the then-Democratic presidential candidate called for a civilian force to take some of the national security burden off the military.
"That's exactly what Hitler did in Nazi Germany and it's exactly what the Soviet Union did," Broun said. "When he's proposing to have a national security force that's answering to him, that is as strong as the U.S. military, he's showing me signs of being Marxist."
Obama's comments about a national security force came during a speech in Colorado about building a new civil service corps. Among other things, he called for expanding the nation's foreign service and doubling the size of the Peace Corps "to renew our diplomacy."
"We cannot continue to rely only on our military in order to achieve the national security objectives that we've set," Obama said in July. "We've got to have a civilian national security force that's just as powerful, just as strong, just as well-funded."
Broun said he also believes Obama likely will move to ban gun ownership if he does build a national police force.
Click here to view Source Article
The Revealer
Nov 10, 2008
http://www.abovetopsecret.com/forum/thread410524/pg1
Broun cited a July speech by Obama that has circulated on the Internet in which the then-Democratic presidential candidate called for a civilian force to take some of the national security burden off the military.
"That's exactly what Hitler did in Nazi Germany and it's exactly what the Soviet Union did," Broun said. "When he's proposing to have a national security force that's answering to him, that is as strong as the U.S. military, he's showing me signs of being Marxist."
Obama's comments about a national security force came during a speech in Colorado about building a new civil service corps. Among other things, he called for expanding the nation's foreign service and doubling the size of the Peace Corps "to renew our diplomacy."
"We cannot continue to rely only on our military in order to achieve the national security objectives that we've set," Obama said in July. "We've got to have a civilian national security force that's just as powerful, just as strong, just as well-funded."
Broun said he also believes Obama likely will move to ban gun ownership if he does build a national police force.
Click here to view Source Article
Sunday, November 9, 2008
I'm changing as fast as I can!
I'm changing as fast as I can!
Patrice Lewis
Nov 08, 2008
http://www.worldnetdaily.com/
index.php?fa=PAGE.view&pageId=80410
Well, on the bright side, there were no riots in the streets following Tuesday's election. This is good.
On the other hand, Obama got elected president. We also have a Democrat majority in the Senate. Therefore, we must prepare to "change." This is bad.
I truly believe we are heading into one of the most divisive times in our nation's history, and it won't have anything to do with skin color. (How tired I am of hearing that argument.) It will have everything to do with socialism vs. free-market economics. Dependence vs. independence.
During a recent history lesson with my homeschooled daughters, we discussed some of the highlights of ancient Greek civilization and its contributions to our current culture. I told the girls about Hippocrates and the Hippocratic oath, a portion of which can be summed up as "First, do no harm."
Maybe this could apply to the Obama administration. First, do not harm us.
Unfortunately, new presidents merely take an oath to support and defend the Constitution, and we all know how well that oath is fulfilled. So a plea to "do no harm" will undoubtedly fall on deaf ears.
By implication, we can assume that the "changes" that will be forced upon us in the next four years will harm us. More than ever before, now is the time to cultivate personal independence – or as much as you can in our fettered condition. The less you need the government, the more you weaken it. The more dependent you are on government, the more power it has.
It was Supreme Court Justice William O. Douglas (1939-1975) who said, "The right to be left alone is indeed the beginning of all freedom." Keep that in mind as you consider the following suggestions.
(1) Prepare to hunker down. Interpret this as you will.
(2) If you have any, hide your money – otherwise it will be spread around. The best way to spread your own wealth on your own terms is to hire people to work for you. But of course, you knew that already.
(3) Take your kids out of public school. Schools are going to become nothing but Marxist pressure cookers. They're already socialist indoctrination centers. Have you any idea what they're teaching in kindergarten these days, much less high school? Better find out.
(4) If you're Joe the Plumber, hide. Quickly. Otherwise your life for the next four years will be a living hell. Obama supporters have demonstrated they like to retaliate, so you're not safe.
(5) Buy guns and ammunition. Especially ammunition. The tools necessary for self-defense and to keep our government under at least a modicum of control are going to quickly become unavailable. Perhaps not banned outright – that would cause riots – but the taxes on these tools of self-reliance will be raised so high that the effect will be the same.
(6) Don't surrender to guilt. Opposing the new world order coming your way is not selfish. The "best interests of all" are code words for state slavery. "From each according to his abilities, to each according to his needs" is the death of liberty and the definition of Marxism. Duh.
(7) Stockpile some resources, because it's only a matter of time before our terrorist enemies (who are delighted with the outcome of the election) will launch something nasty our way. Terrorists love weak or untried rulers because they prefer to strike vulnerable targets. We just bared our throats.
(8) Move. Whatever your political affiliation, it's always best to live in a place with like-minded people. (Idaho might be worth considering.) Just make sure the place you move to has people whose concepts of liberty agree with yours.
(9) Start looking for other news sources, because it's very likely that your favorite conservative radio talk-show host will go out of business once the (ahem) "Fairness" Doctrine gets re-implemented.
(10) Buy light bulbs. There is no possible way our new green president will lift the absurd imminent ban on incandescent light bulbs. Unless you want your home to look like the inside of a train station lavatory in 2012, you'd better stock up on incandescents while you can. (Obviously lights bulbs are a metaphor for all the "for your own good" changes that will be shoved upon us.)
(11) Go to church. All the morals and values that we once cherished in this country – traditional marriage, sanctity of life, family values – are going to become so condemned that churches will be our only sanctuaries.
(12) Strengthen your family, your community, your state. Obama has said that an economy is built from the bottom up. In that he is entirely wrong (poor people don't hire – only rich people do that). But liberty most certainly IS built from the bottom up. Start by strengthening yourself. Next, your family. Support your neighbors. Build your community. Get involved with your state. The days of sitting on your hands must be over.
(13) Find another job. Or preferably, several. Don't give up your current job, of course, but as the economy continues to nosedive, it is best to cultivate your marketable skills and diversify your income sources. The more income irons you have in the fire, the better.
(14) Never never never never trust that the upcoming administration will do anything in your best interest. If the government offers you something that seems too good to be true, assume that it is. Education, medical care, housing and other benefits are never free – they cost something down the line. And the cost is always freedom. Take warning.
Obviously this list barely scratches the surface. If you use your head, you can think of many more. But better hurry up. Change is coming, like it or not.
But the thing about "change" is that it can work both ways. The ordinary Joe Plumbers of this country can change, too – and it may not be in the direction the government will like.
Tough patooties.
Patrice Lewis
Nov 08, 2008
http://www.worldnetdaily.com/
index.php?fa=PAGE.view&pageId=80410
Well, on the bright side, there were no riots in the streets following Tuesday's election. This is good.
On the other hand, Obama got elected president. We also have a Democrat majority in the Senate. Therefore, we must prepare to "change." This is bad.
I truly believe we are heading into one of the most divisive times in our nation's history, and it won't have anything to do with skin color. (How tired I am of hearing that argument.) It will have everything to do with socialism vs. free-market economics. Dependence vs. independence.
During a recent history lesson with my homeschooled daughters, we discussed some of the highlights of ancient Greek civilization and its contributions to our current culture. I told the girls about Hippocrates and the Hippocratic oath, a portion of which can be summed up as "First, do no harm."
Maybe this could apply to the Obama administration. First, do not harm us.
Unfortunately, new presidents merely take an oath to support and defend the Constitution, and we all know how well that oath is fulfilled. So a plea to "do no harm" will undoubtedly fall on deaf ears.
By implication, we can assume that the "changes" that will be forced upon us in the next four years will harm us. More than ever before, now is the time to cultivate personal independence – or as much as you can in our fettered condition. The less you need the government, the more you weaken it. The more dependent you are on government, the more power it has.
It was Supreme Court Justice William O. Douglas (1939-1975) who said, "The right to be left alone is indeed the beginning of all freedom." Keep that in mind as you consider the following suggestions.
(1) Prepare to hunker down. Interpret this as you will.
(2) If you have any, hide your money – otherwise it will be spread around. The best way to spread your own wealth on your own terms is to hire people to work for you. But of course, you knew that already.
(3) Take your kids out of public school. Schools are going to become nothing but Marxist pressure cookers. They're already socialist indoctrination centers. Have you any idea what they're teaching in kindergarten these days, much less high school? Better find out.
(4) If you're Joe the Plumber, hide. Quickly. Otherwise your life for the next four years will be a living hell. Obama supporters have demonstrated they like to retaliate, so you're not safe.
(5) Buy guns and ammunition. Especially ammunition. The tools necessary for self-defense and to keep our government under at least a modicum of control are going to quickly become unavailable. Perhaps not banned outright – that would cause riots – but the taxes on these tools of self-reliance will be raised so high that the effect will be the same.
(6) Don't surrender to guilt. Opposing the new world order coming your way is not selfish. The "best interests of all" are code words for state slavery. "From each according to his abilities, to each according to his needs" is the death of liberty and the definition of Marxism. Duh.
(7) Stockpile some resources, because it's only a matter of time before our terrorist enemies (who are delighted with the outcome of the election) will launch something nasty our way. Terrorists love weak or untried rulers because they prefer to strike vulnerable targets. We just bared our throats.
(8) Move. Whatever your political affiliation, it's always best to live in a place with like-minded people. (Idaho might be worth considering.) Just make sure the place you move to has people whose concepts of liberty agree with yours.
(9) Start looking for other news sources, because it's very likely that your favorite conservative radio talk-show host will go out of business once the (ahem) "Fairness" Doctrine gets re-implemented.
(10) Buy light bulbs. There is no possible way our new green president will lift the absurd imminent ban on incandescent light bulbs. Unless you want your home to look like the inside of a train station lavatory in 2012, you'd better stock up on incandescents while you can. (Obviously lights bulbs are a metaphor for all the "for your own good" changes that will be shoved upon us.)
(11) Go to church. All the morals and values that we once cherished in this country – traditional marriage, sanctity of life, family values – are going to become so condemned that churches will be our only sanctuaries.
(12) Strengthen your family, your community, your state. Obama has said that an economy is built from the bottom up. In that he is entirely wrong (poor people don't hire – only rich people do that). But liberty most certainly IS built from the bottom up. Start by strengthening yourself. Next, your family. Support your neighbors. Build your community. Get involved with your state. The days of sitting on your hands must be over.
(13) Find another job. Or preferably, several. Don't give up your current job, of course, but as the economy continues to nosedive, it is best to cultivate your marketable skills and diversify your income sources. The more income irons you have in the fire, the better.
(14) Never never never never trust that the upcoming administration will do anything in your best interest. If the government offers you something that seems too good to be true, assume that it is. Education, medical care, housing and other benefits are never free – they cost something down the line. And the cost is always freedom. Take warning.
Obviously this list barely scratches the surface. If you use your head, you can think of many more. But better hurry up. Change is coming, like it or not.
But the thing about "change" is that it can work both ways. The ordinary Joe Plumbers of this country can change, too – and it may not be in the direction the government will like.
Tough patooties.
Saturday, November 8, 2008
Yes we can draft your ass
Yes we can -- draft your ass
JD Tuccille
Nov 06, 2008
http://www.tuccille.com/blog/2008/11/
yes-we-can-draft-your-ass.html
You know, I warn, and I warn, and I warn, and I warn, but nobody listens. Don't know what I'm talking about? Read on ...
Rep. Rahm Emanuel of Illinois, President-Elect Obama's choice for chief of staff in his incoming administration, is co-author of a book, The Plan, that calls for, among other things, compulsory service for all Americans ages 18 to 25. The following excerpt is from pages 61-62 of the 2006 book:
It's time for a real Patriot Act that brings out the patriot in all of us. We propose universal civilian service for every young American. Under this plan, All Americans between the ages of eighteen and twenty-five will be asked to serve their country by going through three months of basic training, civil defense preparation and community service. ...
Here's how it would work. Young people will know that between the ages of eighteen and twenty-five, the nation will enlist them for three months of civilian service. They'll be asked to report for three months of basic civil defense training in their state or community, where they will learn what to do in the event of biochemical, nuclear or conventional attack; how to assist others in an evacuation; how to respond when a levee breaks or we're hit by a natural disaster. These young people will be available to address their communities' most pressing needs.
Emanuel and co-author Bruce Reed insist "this is not a draft," but go on to write of young men and women, "the nation will enlist them for three months of civilian service." They also warn, "[s]ome Republicans will squeal about individual freedom," ruling out any likelihood that they would let people opt out of universal citizen service.
As chief of staff, Emanuel will not be in a position to directly introduce public policy, but his enthusiasm for compulsory service, combined with Barack Obama's own plan to require high school students to perform 50 hours of government-approved service, suggest an unfortunate direction for the new administration.
JD Tuccille
Nov 06, 2008
http://www.tuccille.com/blog/2008/11/
yes-we-can-draft-your-ass.html
You know, I warn, and I warn, and I warn, and I warn, but nobody listens. Don't know what I'm talking about? Read on ...
Rep. Rahm Emanuel of Illinois, President-Elect Obama's choice for chief of staff in his incoming administration, is co-author of a book, The Plan, that calls for, among other things, compulsory service for all Americans ages 18 to 25. The following excerpt is from pages 61-62 of the 2006 book:
It's time for a real Patriot Act that brings out the patriot in all of us. We propose universal civilian service for every young American. Under this plan, All Americans between the ages of eighteen and twenty-five will be asked to serve their country by going through three months of basic training, civil defense preparation and community service. ...
Here's how it would work. Young people will know that between the ages of eighteen and twenty-five, the nation will enlist them for three months of civilian service. They'll be asked to report for three months of basic civil defense training in their state or community, where they will learn what to do in the event of biochemical, nuclear or conventional attack; how to assist others in an evacuation; how to respond when a levee breaks or we're hit by a natural disaster. These young people will be available to address their communities' most pressing needs.
Emanuel and co-author Bruce Reed insist "this is not a draft," but go on to write of young men and women, "the nation will enlist them for three months of civilian service." They also warn, "[s]ome Republicans will squeal about individual freedom," ruling out any likelihood that they would let people opt out of universal citizen service.
As chief of staff, Emanuel will not be in a position to directly introduce public policy, but his enthusiasm for compulsory service, combined with Barack Obama's own plan to require high school students to perform 50 hours of government-approved service, suggest an unfortunate direction for the new administration.
Friday, November 7, 2008
We Will Watch Obama Like A Hawk
We Will Watch Obama Like A Hawk
Bob Chapman
Nov 05, 2008
http://www.theinternationalforecaster.com/
International_Forecaster_Weekly/
We_Will_Watch_Obama_Like_A_Hawk
Congratulations, America. You are now officially the Obamanation. Not that you had any other realistic choices. And the only other viable alternative, McCain, was no better than Obama. He will now be forced to do as he is told under threat of exposure, and will have no independent latitude to make decisions concerning anything which the Illuminati care about. Biden will be his handler just as Cheney was, and continues to be, Caligula's handler. In fact, that's why Biden, a fervent and hardened Illuminist, was chosen as VP.
The October Surprise also explains why Palin was chosen as VP for McCain. McCain and Palin were never seriously in contention due to the coming October Surprise, so this gave the Illuminists a chance to cater to the Christian Right without any worries about Palin ever becoming President in the event that McCain could no longer serve in that capacity. Once again, the naive and fawning Christian Right got all excited over being patronized in yet another false-flag overture to Christians. The Palin nomination was intended as a plug for incumbent traitors in Congress who had electorates filled with Christian voters. The idea was to energize these Christian voters so as to help these incumbents get reelected. In this manner, the evil Illuminists attempted to keep the best government officials that money could buy in office, while the government officials who were up for reelection attempted to keep their established system of embedded graft and corruption going. Apparently, despite all that has happened, the Christian Right still can't recognize a wolf in sheep's clothing, nor are they able to perceive when they are being led down a garden path. With that kind of gullible leadership, Christianity is doomed in the US. In time, we will become just like Europe, unless God intervenes with an Exodus-like series of miracles to spark a Christian revival, because that is what it will probably take to wake up our sleeping Christian leaders.
Dr Martin Luther King, whose thoughts and philosophy were the antithesis of those held by the Illuminati, ended up being assassinated by them, while by contrast, Mr. Obama, an elitist bootlicker who surrounds himself with upper tier Illuminist advisors like Brzezinski, Buffett, Volcker, Rubin and Anderson, and who kow-tows to the same evil Illuminist scum who are financing his Jimmy-Carter-like campaign out of obscurity, ended up being elected President of the United States. This shows you, in no uncertain terms, how corrupt the system really is.
We judge people by the content of their character as Dr. King suggested, and based on Mr. Obama's campaign associations alone, we would have to conclude that his character is not a good one. His support of Fannie and Freddie in the face of their obvious bankruptcy, and his number one spot as the target of Fannie and Freddie campaign contribution largesse, puts the icing on the cake, as does his support of Mr. Odinga, whose attempted coup in Kenya has resulted in the destruction of 800 Christian churches and the murders of hundreds of Christian Kenyans, events which were totally suppressed by the fane-stream media. He is not Dr. King. In fact, he is the precise opposite of Dr. King, who preferred peace over militancy.
Worse yet, we note that the current group of Illuminati are the most virulent racists of all time. They make Hitler look like a civil rights leader. What may be happening here is that these fiends are trying to associate what will be the worst economic, social and political times ever suffered by Americans, which these elitists have malevolently and intentionally orchestrated to bring America to its knees and to pave the way for world government, with a black Presidency. In one brilliant master stroke, they will take all the misery they have created to push us into a corporatist, fascist police state, and place it on the head of a black President. In addition, they will make sure that his Presidency is a disaster and that it does not succeed. Obama will be in over his head, and due to his compromised position regarding his citizenship, he will do whatever they tell him to do, and none of it will work. That is because it is not supposed to work. They want to bring you to your knees so you will bow down to the new self-proclaimed masters of the universe as the old Goldilocks Matrix is discarded and the new corporatist, fascist police state is substituted in its place. Note how well this association of national disaster with a black Presidency will play into the rhetoric of white supremacists.
Like Pavlov's dogs, the sheople are conditioned to come bleating to the voting polls on Election Day to cast their vote for reprobate A, or for reprobate B. They think they are making a choice, but for most part, in the important campaigns like President of the US and many other major state and federal elective positions, the choice has already been made for them. Pick Illuminist Skull and Bones candidate A, or pick Illuminist Skull and Bones candidate B, ala Bush against Kerry. Either way, we win. Candidate A will promote items "a" through "m" of our agenda, and candidate B will promote items "n" through "z" of our agenda.
Politicians blab away, talking about what is on their party's agenda, and then they are told what to do by those in our shadow government who run the whole agenda, which is of course divided between the two parties. We promise Mr. Obama that we will never listen to what he says, but will we watch what he does like a hawk. We will burn away all the Illuminist lies and webs of deceit which are woven around his actions to obscure and to obfuscate their true nature and purpose. We will give him a chance like anyone else and we will be his supporter if he is honest and forthright. But we will be his worst nightmare if he tries to get "cute" with the American people. We will expose what he is doing and lay it bare to the American public. If he is not being honest we will see right through it, and then tell you, our subscribers, how things really are. This is what we have done over the course of the past ten Presidential Administrations preceding Obama's coming Administration, and is what we will continue to do. Remember, Mr. Obama, we have been doing this for over 50 years and we know their agenda and how they operate far better than you do. We can also assure you that they are not telling you everything they plan to do. You could not take the shock. You might even be enraged. They will tell you what is coming on an as-needed basis.
Obama will now put the finishing touches on the destruction of America which was started in earnest under the previous trilogy of traitors, or triad of trouble, which commenced with the Administration of Bohemian Bush, Sr., continued with vigor under Slick Willie Clinton, and then was nearly completed during the epically catastrophic Caligula administration, which we note is still not finished with its skullduggery, and won't be until Caligula leaves office, if ever.
The above are just a few of the possible scenarios, which the Illuminists could force on us in order to implement martial law and a feudal, Orwellian police state. Who knows what could happen as long as these Illuminist sociopaths are running our shadow government? Never underestimate the cleverness of these megalomaniacal, satanic trillionaires, whose intelligence is powered by supernatural forces of evil and darkness. Next comes another major war to distract us from the destruction of our economy, and to destroy our military so we have no defense against foreign troops or against both foreign and domestic mercenaries. We also note that Obama has promised a new national draft so that your children get to be cannon fodder for the fun and profit of the US military-industrial complex and so they also get to become the objects of persecution and terrorist retribution overseas as they are forced to stick their noses into everyone else's business where they do not belong.
Even if they end the war in Iraq and divvy it up with big oil while retaining a mercenary force, rest assured that they will move on to the next war or escalation in Afghanistan, Iran, Syria, Lebanon, in the Balkans, or on the Russian border. Who knows with these maniacs? This is the end of our society as we know it. This is the Fall of the House of Usher.
The prices of gold and silver futures have been suppressed to such an extent by the Illuminists within the Treasury Department that there is a stampede out of gold and silver futures, an event that could lead to default. As you all know physical gold and silver are in short supply and we are seeing higher premiums. At the same time the rigged futures market is just the opposite. All throughout history good money, gold, has driven out bad, fiat, and that is why the gold and silver futures market will either collapse because no one will play anymore, or they will default as a result of inability to deliver.
Gold is a 2-edged sword. Gold and silver go up with inflation and hyperinflation and gold also goes up or holds its own in deflation in a flight to quality.
We have been in the credit crisis for 15 months and the US and world economies are headed at breakneck speed into deep recession. We have stagflation, inflation and stagnation and it is going to get considerably worse as we head toward eventual deflation. Personal consumption expenditures are falling, as is GDP, which in the third quarter finally entered the minus column. We have a rigged rally in the dollar as consumption falls and government expenditures climb. Long before this is over the part of GDP consisting of personal consumption will fall from 70% to 72% to the long-term mean of 64.5% and that alone will cripple the economy. Although we see it going into the 50s as depression takes hold a few years from now. Our government and Wall Street are orchestrating a less severe recession to keep you spending and to keep you in the rigged stock market. As a result you are talked into a bailout package for banks and Wall Street. It doesn’t work and over 80% of Americans are against the package because they know what is going on. They are listening to alternative radio and reading what is on the Internet. In spite of that a purchased or compromised Congress give the corrupt Illuminists what they wanted. It must also be remembered the administration told congressmen that if we didn’t have such legislation that they’d impose Martial law. That is what corporate fascist government is all about.
We are already in a severe recession. All of our government’s statistics are bogus. The bailout was for the most part for money center banks, the big financial conglomerates and transnational corporations. Those funds went to the insiders, not to smaller institutions. They were for the crime syndicate, the corrupt Illuminist mafia. The next step after the election is the monetization of money and credit and horrible hyperinflation. Soon the dollar short covering will be history. Libor has already fallen and is back in its normal place. Credit derivatives and credit default swaps has produced a demand for dollars for settlement payouts. That will soon end as well. Fifteen months ago these derivatives began to fail and that systemic failure is ongoing. It will end in the complete collapse of the dollar.
This is the same barbaric horde that just sent the commodity market down almost 60%. They are now waiting to take it back up again to plunder the public once more. They bashed commodities and gold and silver because the rush for real assets had to be destroyed even though it was temporary. As a result there was a rush into physical gold and silver products, a resultant shortage developed. The elitists saw that and not wanting more physical gold in the publics’ hands the mints in Johannesburg, Canada, the US and Mexico shut down. Do you really think that was coincidence? They do not want gold and silver attractive because they are going to hyper inflate. At least for the next two to three years inflation is going to rage. Money and credit are still expanding at 12-1/2% and inflation is 12-1/2%. What deflationists do not seem to grasp is that the elitists will keep the system running because they do not want a crash until they can get a major war underway, as a distraction; another way of adding wealth, and for getting a tighter grasp on power and to further exercise population control. The question is when will the viability of America debt be questioned? Will the failure to deliver US treasuries break the market and not nonparticipation? We do not know but it is surely possible. This is why we have not for some time recommended US Treasuries, but instead Swiss franc Treasuries for those who prefer a partial cash position. It is very simple. The more debt the US government creates and the more money and credit the Fed creates the more the value of the dollar depreciates. Worse yet, the collateral being presented for the exchange of Treasuries is essentially worthless. We also believe Treasuries are being created and not being reported in order to satisfy the perceived flight to quality. Remember, these people do not tell the truth about anything and they believe as the Illuminated ones that they can do anything they please. That is why we continue to tell you to be out of US government and debt paper as well as the stock market. The only exceptions are gold, silver and oil and gas stocks. Cash out your retirement plans if you can and move them into gold and silver related assets. We can promise you two things, hyperinflation and eventual Treasury default. Why do you think on 11/15 major nations are meeting to form a new monetary unit? It will take several months. But it is about to happen. The dollar as a reserve currency and as a store of value is finished and many other currencies will follow. Remember 64.5% of world central bank reserves are in US dollars. No country is going to survive this unscathed. There will be a trigger as there always is. It probably will be an economic event or a string of events that begins the dollar collapse. There are things going on we know nothing about, but which we will soon find out about.
We have another couple of bubbles coming. There is a pension bomb that is in process and the credit card bubble-bomb. Lenders wrote off about $21 billion in bad credit card loans in the first half of 2008, and they haven’t even scratched the surface yet. Companies are laying off millions of workers and it is currently conservatively estimated that by the end of 2009 they’ll lose another $55 billion. Currently losses are 5.5% of debt outstanding and probably will easily exceed 8%.
As lenders rethink their lending rules our credit-hooked nation is rethinking their credit habits. It is about time lenders smartened up and stopped being greedy and it is about time Americans started paying for gas, food and other items with cash. You should only be using credit cards for emergencies and you should pay off your debit every month.
In 2005 mortgage extractions were $595 billion, in 2007 they fell to $470 billion and the second quarter of 2008 saw $9.5 billion. At that rate we’ll see a 90% drop from 2005.
Total loans from commercial banks grew by $89 billion yoy to December. Of that $61 billion was credit card debt. That means banks only lent $28 billion to business or to individuals. These numbers show you how stressed consumers are, amid accelerating job loss, low wages and high inflation, home price deflation, the effects of illegal immigration and the losses in equity in stocks, never mind having their retirement accounts clobbered. Credit card debt is up – it has risen more in the recent 10 weeks than it has in the previous 10 months. The increase is annualized at 48.3%. American Express delinquencies on credit payments rose to 4.1% in the third quarter, up from 2.5% yoy, their pool of uncollectible loans to a high of 6.7%. If it weren’t so sad the following would be laughable. The second largest credit card merchant vendor is McDonalds. This is a sign of very serious distress. This level of credit card usage is unsustainable.
All this comes as stock market losses worldwide reduced global wealth by $16 trillion. A good part of which was in retirement accounts. This coming year government will admit to unemployment of more than 9%. That puts U6 at 14% and long-term at 17% using government figures. The duration of current unemployment is nine months or 38 weeks. That will be at least 14 months at the end of 2009. Unless unemployment benefits are expended an additional six months they’ll be lots of people in serious financial trouble. That means less consumption, which will feed recession. Incidentally, that will widen the budget deficit. Unemployed don’t pay taxes and that means less revenue.
We see a 2009 budget deficit of $1.2 trillion plus, as the recession deepens. The only thing keeping the end of 2009 out of depression will be massive injections of money and credit and that will cause the dollar to fall and inflation, gold and silver to rise. With all this in the mix we see would-be newsletter writers, economists and analysts predicting already slow recovery by the end of 2009. In order to be politically acceptable they didn’t recognize recession until a few months ago, a year and one-half behind the curve. This in spite of massive welfare during the year.
Bob Chapman
Nov 05, 2008
http://www.theinternationalforecaster.com/
International_Forecaster_Weekly/
We_Will_Watch_Obama_Like_A_Hawk
Congratulations, America. You are now officially the Obamanation. Not that you had any other realistic choices. And the only other viable alternative, McCain, was no better than Obama. He will now be forced to do as he is told under threat of exposure, and will have no independent latitude to make decisions concerning anything which the Illuminati care about. Biden will be his handler just as Cheney was, and continues to be, Caligula's handler. In fact, that's why Biden, a fervent and hardened Illuminist, was chosen as VP.
The October Surprise also explains why Palin was chosen as VP for McCain. McCain and Palin were never seriously in contention due to the coming October Surprise, so this gave the Illuminists a chance to cater to the Christian Right without any worries about Palin ever becoming President in the event that McCain could no longer serve in that capacity. Once again, the naive and fawning Christian Right got all excited over being patronized in yet another false-flag overture to Christians. The Palin nomination was intended as a plug for incumbent traitors in Congress who had electorates filled with Christian voters. The idea was to energize these Christian voters so as to help these incumbents get reelected. In this manner, the evil Illuminists attempted to keep the best government officials that money could buy in office, while the government officials who were up for reelection attempted to keep their established system of embedded graft and corruption going. Apparently, despite all that has happened, the Christian Right still can't recognize a wolf in sheep's clothing, nor are they able to perceive when they are being led down a garden path. With that kind of gullible leadership, Christianity is doomed in the US. In time, we will become just like Europe, unless God intervenes with an Exodus-like series of miracles to spark a Christian revival, because that is what it will probably take to wake up our sleeping Christian leaders.
Dr Martin Luther King, whose thoughts and philosophy were the antithesis of those held by the Illuminati, ended up being assassinated by them, while by contrast, Mr. Obama, an elitist bootlicker who surrounds himself with upper tier Illuminist advisors like Brzezinski, Buffett, Volcker, Rubin and Anderson, and who kow-tows to the same evil Illuminist scum who are financing his Jimmy-Carter-like campaign out of obscurity, ended up being elected President of the United States. This shows you, in no uncertain terms, how corrupt the system really is.
We judge people by the content of their character as Dr. King suggested, and based on Mr. Obama's campaign associations alone, we would have to conclude that his character is not a good one. His support of Fannie and Freddie in the face of their obvious bankruptcy, and his number one spot as the target of Fannie and Freddie campaign contribution largesse, puts the icing on the cake, as does his support of Mr. Odinga, whose attempted coup in Kenya has resulted in the destruction of 800 Christian churches and the murders of hundreds of Christian Kenyans, events which were totally suppressed by the fane-stream media. He is not Dr. King. In fact, he is the precise opposite of Dr. King, who preferred peace over militancy.
Worse yet, we note that the current group of Illuminati are the most virulent racists of all time. They make Hitler look like a civil rights leader. What may be happening here is that these fiends are trying to associate what will be the worst economic, social and political times ever suffered by Americans, which these elitists have malevolently and intentionally orchestrated to bring America to its knees and to pave the way for world government, with a black Presidency. In one brilliant master stroke, they will take all the misery they have created to push us into a corporatist, fascist police state, and place it on the head of a black President. In addition, they will make sure that his Presidency is a disaster and that it does not succeed. Obama will be in over his head, and due to his compromised position regarding his citizenship, he will do whatever they tell him to do, and none of it will work. That is because it is not supposed to work. They want to bring you to your knees so you will bow down to the new self-proclaimed masters of the universe as the old Goldilocks Matrix is discarded and the new corporatist, fascist police state is substituted in its place. Note how well this association of national disaster with a black Presidency will play into the rhetoric of white supremacists.
Like Pavlov's dogs, the sheople are conditioned to come bleating to the voting polls on Election Day to cast their vote for reprobate A, or for reprobate B. They think they are making a choice, but for most part, in the important campaigns like President of the US and many other major state and federal elective positions, the choice has already been made for them. Pick Illuminist Skull and Bones candidate A, or pick Illuminist Skull and Bones candidate B, ala Bush against Kerry. Either way, we win. Candidate A will promote items "a" through "m" of our agenda, and candidate B will promote items "n" through "z" of our agenda.
Politicians blab away, talking about what is on their party's agenda, and then they are told what to do by those in our shadow government who run the whole agenda, which is of course divided between the two parties. We promise Mr. Obama that we will never listen to what he says, but will we watch what he does like a hawk. We will burn away all the Illuminist lies and webs of deceit which are woven around his actions to obscure and to obfuscate their true nature and purpose. We will give him a chance like anyone else and we will be his supporter if he is honest and forthright. But we will be his worst nightmare if he tries to get "cute" with the American people. We will expose what he is doing and lay it bare to the American public. If he is not being honest we will see right through it, and then tell you, our subscribers, how things really are. This is what we have done over the course of the past ten Presidential Administrations preceding Obama's coming Administration, and is what we will continue to do. Remember, Mr. Obama, we have been doing this for over 50 years and we know their agenda and how they operate far better than you do. We can also assure you that they are not telling you everything they plan to do. You could not take the shock. You might even be enraged. They will tell you what is coming on an as-needed basis.
Obama will now put the finishing touches on the destruction of America which was started in earnest under the previous trilogy of traitors, or triad of trouble, which commenced with the Administration of Bohemian Bush, Sr., continued with vigor under Slick Willie Clinton, and then was nearly completed during the epically catastrophic Caligula administration, which we note is still not finished with its skullduggery, and won't be until Caligula leaves office, if ever.
The above are just a few of the possible scenarios, which the Illuminists could force on us in order to implement martial law and a feudal, Orwellian police state. Who knows what could happen as long as these Illuminist sociopaths are running our shadow government? Never underestimate the cleverness of these megalomaniacal, satanic trillionaires, whose intelligence is powered by supernatural forces of evil and darkness. Next comes another major war to distract us from the destruction of our economy, and to destroy our military so we have no defense against foreign troops or against both foreign and domestic mercenaries. We also note that Obama has promised a new national draft so that your children get to be cannon fodder for the fun and profit of the US military-industrial complex and so they also get to become the objects of persecution and terrorist retribution overseas as they are forced to stick their noses into everyone else's business where they do not belong.
Even if they end the war in Iraq and divvy it up with big oil while retaining a mercenary force, rest assured that they will move on to the next war or escalation in Afghanistan, Iran, Syria, Lebanon, in the Balkans, or on the Russian border. Who knows with these maniacs? This is the end of our society as we know it. This is the Fall of the House of Usher.
The prices of gold and silver futures have been suppressed to such an extent by the Illuminists within the Treasury Department that there is a stampede out of gold and silver futures, an event that could lead to default. As you all know physical gold and silver are in short supply and we are seeing higher premiums. At the same time the rigged futures market is just the opposite. All throughout history good money, gold, has driven out bad, fiat, and that is why the gold and silver futures market will either collapse because no one will play anymore, or they will default as a result of inability to deliver.
Gold is a 2-edged sword. Gold and silver go up with inflation and hyperinflation and gold also goes up or holds its own in deflation in a flight to quality.
We have been in the credit crisis for 15 months and the US and world economies are headed at breakneck speed into deep recession. We have stagflation, inflation and stagnation and it is going to get considerably worse as we head toward eventual deflation. Personal consumption expenditures are falling, as is GDP, which in the third quarter finally entered the minus column. We have a rigged rally in the dollar as consumption falls and government expenditures climb. Long before this is over the part of GDP consisting of personal consumption will fall from 70% to 72% to the long-term mean of 64.5% and that alone will cripple the economy. Although we see it going into the 50s as depression takes hold a few years from now. Our government and Wall Street are orchestrating a less severe recession to keep you spending and to keep you in the rigged stock market. As a result you are talked into a bailout package for banks and Wall Street. It doesn’t work and over 80% of Americans are against the package because they know what is going on. They are listening to alternative radio and reading what is on the Internet. In spite of that a purchased or compromised Congress give the corrupt Illuminists what they wanted. It must also be remembered the administration told congressmen that if we didn’t have such legislation that they’d impose Martial law. That is what corporate fascist government is all about.
We are already in a severe recession. All of our government’s statistics are bogus. The bailout was for the most part for money center banks, the big financial conglomerates and transnational corporations. Those funds went to the insiders, not to smaller institutions. They were for the crime syndicate, the corrupt Illuminist mafia. The next step after the election is the monetization of money and credit and horrible hyperinflation. Soon the dollar short covering will be history. Libor has already fallen and is back in its normal place. Credit derivatives and credit default swaps has produced a demand for dollars for settlement payouts. That will soon end as well. Fifteen months ago these derivatives began to fail and that systemic failure is ongoing. It will end in the complete collapse of the dollar.
This is the same barbaric horde that just sent the commodity market down almost 60%. They are now waiting to take it back up again to plunder the public once more. They bashed commodities and gold and silver because the rush for real assets had to be destroyed even though it was temporary. As a result there was a rush into physical gold and silver products, a resultant shortage developed. The elitists saw that and not wanting more physical gold in the publics’ hands the mints in Johannesburg, Canada, the US and Mexico shut down. Do you really think that was coincidence? They do not want gold and silver attractive because they are going to hyper inflate. At least for the next two to three years inflation is going to rage. Money and credit are still expanding at 12-1/2% and inflation is 12-1/2%. What deflationists do not seem to grasp is that the elitists will keep the system running because they do not want a crash until they can get a major war underway, as a distraction; another way of adding wealth, and for getting a tighter grasp on power and to further exercise population control. The question is when will the viability of America debt be questioned? Will the failure to deliver US treasuries break the market and not nonparticipation? We do not know but it is surely possible. This is why we have not for some time recommended US Treasuries, but instead Swiss franc Treasuries for those who prefer a partial cash position. It is very simple. The more debt the US government creates and the more money and credit the Fed creates the more the value of the dollar depreciates. Worse yet, the collateral being presented for the exchange of Treasuries is essentially worthless. We also believe Treasuries are being created and not being reported in order to satisfy the perceived flight to quality. Remember, these people do not tell the truth about anything and they believe as the Illuminated ones that they can do anything they please. That is why we continue to tell you to be out of US government and debt paper as well as the stock market. The only exceptions are gold, silver and oil and gas stocks. Cash out your retirement plans if you can and move them into gold and silver related assets. We can promise you two things, hyperinflation and eventual Treasury default. Why do you think on 11/15 major nations are meeting to form a new monetary unit? It will take several months. But it is about to happen. The dollar as a reserve currency and as a store of value is finished and many other currencies will follow. Remember 64.5% of world central bank reserves are in US dollars. No country is going to survive this unscathed. There will be a trigger as there always is. It probably will be an economic event or a string of events that begins the dollar collapse. There are things going on we know nothing about, but which we will soon find out about.
We have another couple of bubbles coming. There is a pension bomb that is in process and the credit card bubble-bomb. Lenders wrote off about $21 billion in bad credit card loans in the first half of 2008, and they haven’t even scratched the surface yet. Companies are laying off millions of workers and it is currently conservatively estimated that by the end of 2009 they’ll lose another $55 billion. Currently losses are 5.5% of debt outstanding and probably will easily exceed 8%.
As lenders rethink their lending rules our credit-hooked nation is rethinking their credit habits. It is about time lenders smartened up and stopped being greedy and it is about time Americans started paying for gas, food and other items with cash. You should only be using credit cards for emergencies and you should pay off your debit every month.
In 2005 mortgage extractions were $595 billion, in 2007 they fell to $470 billion and the second quarter of 2008 saw $9.5 billion. At that rate we’ll see a 90% drop from 2005.
Total loans from commercial banks grew by $89 billion yoy to December. Of that $61 billion was credit card debt. That means banks only lent $28 billion to business or to individuals. These numbers show you how stressed consumers are, amid accelerating job loss, low wages and high inflation, home price deflation, the effects of illegal immigration and the losses in equity in stocks, never mind having their retirement accounts clobbered. Credit card debt is up – it has risen more in the recent 10 weeks than it has in the previous 10 months. The increase is annualized at 48.3%. American Express delinquencies on credit payments rose to 4.1% in the third quarter, up from 2.5% yoy, their pool of uncollectible loans to a high of 6.7%. If it weren’t so sad the following would be laughable. The second largest credit card merchant vendor is McDonalds. This is a sign of very serious distress. This level of credit card usage is unsustainable.
All this comes as stock market losses worldwide reduced global wealth by $16 trillion. A good part of which was in retirement accounts. This coming year government will admit to unemployment of more than 9%. That puts U6 at 14% and long-term at 17% using government figures. The duration of current unemployment is nine months or 38 weeks. That will be at least 14 months at the end of 2009. Unless unemployment benefits are expended an additional six months they’ll be lots of people in serious financial trouble. That means less consumption, which will feed recession. Incidentally, that will widen the budget deficit. Unemployed don’t pay taxes and that means less revenue.
We see a 2009 budget deficit of $1.2 trillion plus, as the recession deepens. The only thing keeping the end of 2009 out of depression will be massive injections of money and credit and that will cause the dollar to fall and inflation, gold and silver to rise. With all this in the mix we see would-be newsletter writers, economists and analysts predicting already slow recovery by the end of 2009. In order to be politically acceptable they didn’t recognize recession until a few months ago, a year and one-half behind the curve. This in spite of massive welfare during the year.
Subscribe to:
Posts (Atom)