Economic pressures

[Danny B]

Socialism, population, freedom, tax burden, the next currency

For most of man's history, his reproductive ability outstripped his food procuring ability. In Europe, war was called 'the sport of kings". They engaged in warfare for population reduction almost continuously. The only long interruption was during times of plague when Mother Nature took over the job. England kept large numbers in the navy and overseas outposts. War was thought to reduce the lower class because stupid soldiers would tend to get killed more often than smart soldiers.

In the outlands, England used famine to reduce population.
https://larouchepub.com/other/2008/3...al_famine.html
Man has now reached a point where his food producing ability is greater that what is required for a shrinking population (ex sub-Sahara Africa)

The moneyed class had previously used war to limit population growth. The wars were limited by how much gold a State had to purchase arms.

The Central Bank was created by the State specifically to finance and prosecute wars on credit.
Chapter one, page one Page 17
http://group30.org/images/uploads/pu...ralBanking.pdf

Investments in war industries had a very high rate of return.

Since the financiers never created anything, the burden of paying for the wars fell to the producer. The working man had to fight the war. After the end of the war, he had to pay for it. The CB created the bonds to finance the war. The worker / producer paid the "inflation tax" on everything that he needed / bought to repay the bonds.

J. M. Keynes advocated for constant war to keep the economy constantly producing.

In the most basic of analysis, capitalism is the only system of production. You take something physical and, add your labor.

"Marx, who intended to abolish capitalism, Keynes intended to change the system but keep capitalism alive. He suggested social reforms within the capitalist system rather than establishing a whole new system."

Human nature precludes the abolishment of capitalism. We don't work like ants. That doesn't stop Marxists from dreaming.

Capitalism is a fine system as long as everybody is working. Our current situation is a distortion of capitalism by groups who pervert the law to gain profit without working. Through taxes, fines, fees and theft, they take about 50% of our earnings. (Armstrong). Now that our perverted system is crashing from the predations of "crony capitalism", numerous people are calling for socialism as a cure.

Capitalism works just fine. It does not need curing. What we need is an escape from crony capitalism. What we are offered is a continuation of the present system under a new name with the same old controllers.

Armstrong, "The major difference between the socialism supported by the Democrats/Labour in Western Society is that to them the individual has no value, it is the collective society, which they then elevate themselves to rule. Conservatives believe in the individual has rights and value and that the state is to serve the people. In the eyes of socialism, it is not the individual but the collective society which is the value and they are qualified to rule from above. The socialist always seeks to control others and in so doing, the individual is always sacrificed for the collective state."

"Nevertheless, the socialist always pretend that they are on your side. They get people to surrender their individuality to the state and always blame the rich when your quality of life declines.
Keep in mind that career politicians even on the right also support the government against the individual."
That is why Ron Paul stands out so much.
"This to me is the ultimate struggle. We are talking about our freedom which the Founding Fathers made clear – it was to be We the People, not the people as economic slaves to support the state as the tax burden constantly always rises. The average person pays about 50% of their income to support the government on all levels."
"Just look at Venezuela. A country with the highest oil reserves turned left and its people are starving, fleeing the country, and retired people’s pension will buy them perhaps one cup of coffee. Meanwhile. identical to what they found in Russia after the collapse of the government, those in power live lavishly and never starve."
Ah yes, the Champagne socialists like millionaire Sanders.

"This is why the Founding Father prohibited DIRECT TAXES, which the socialists in the rising era of Marxism embraced at the start of the 20th century. " "Once they created the income tax, every individual was now required to account to the state what they possessed and what they did. Since then, all we have are laws that constantly remove our freedoms because they assume we are all hiding money. "
"It is now money laundering to keep cash in a safe deposit box for the new interpretation is hiding money from the government is a crime even if you paid your tax."
" With each passing year, we lose more and more of our human rights and individual security. This can only end in civil war as it has always done throughout history when these two philosophies confront each other. One just wants to be left alone and the other cannot sleep at night if others have what they do not."
https://www.armstrongeconomics.com/a...en-left-right/

You can say what you want about Fidel Castro but, like Ian Smith he really cared about his people. Both of them could walk among their people without guards. Chavez and Maduro have stolen billions. They put their cronies in charge which was far more devastating to the oil industry. Both of them sang the siren song of Marxism and, both of them were thieves. Why is it that the Marxists are always so inept at running an economy?

I feel bad for the Venezuelans. They believed that Chavez would make things better.
"40% Of Venezuela Stores Go Bust After 3,000% Minimum Wage Hike"
"7 million Venezuelan employees were to be guaranteed 1,800 bolivars a month - around $20 USD on the black market. "
https://www.zerohedge.com/news/2018-...imum-wage-hike

"Resist Everything": Socialist Within State Department Exposed In Veritas "Deep State" Sting
https://www.zerohedge.com/news/2018-...tas-deep-state
How can these people possibly believe that resistance and destruction will make the situation better.
The Economist Magazine has a famous cover showing all currencies burning with a Phoenix rising out of the ashes. This Phoenix is supposedly the SDR.
Cloward–Piven strategy calls for everyone to demand so much public assistance that it bankrupts government. They plan on a wonderful Phoenix rising up also.

The deep state along with the blob state is determined to ride the free money train from the bond market. Everybody has their hands out.
Air Force Wants to Surge Growth by More Than 70 New Squadrons ...
The bond markets will crash and, it is very possible that we will end up like Venezuela. Too many people with not enough to eat.
Man is voluntarily reducing his population and, the credit markets will NEVER recover. There are small signs creeping in.
The Most Important Stock in the World Has Broken Its Trendline
https://www.zerohedge.com/news/2018-...-its-trendline
David Morgan, "- We could move to a "cryptocurrency type of situation that is government backed"; is a "world currency possibility" or we could "go back to some type of gold standard"
- "Very difficult to know how the currency reset might come about and I do not think even the elites know at this stage"
Bretton Woods was an agreement that would limit how much a State could inflate their bond market. Thus, reducing wars. Nothing but gold has ever worked in this role.

[Danny B]

Destroy the family and, you destroy the economy

200 years ago, Europe was exporting it's surplus population. The mindset of the ptb was focused on population reduction. Population growth fell way off as countries industrialized. We no longer needed large families to work a farm. As the Central Banks made us poorer to pay for wars, women were drawn out of the household and, into the labor force. Population growth fell further. America opened the southern border to keep the population from shrinking. There is no possibility of having a growing credit bubble with a shrinking population.
As the moneyed class demanded more and more, everyone was pulled into the labor force. With the fragmentation of the nuclear family came the destruction of mental health.
Removing women from the household may have generated more wealth to be siphoned off by the bankers but, it continues to lower the birth rate. This makes the demographic crash that much worse. Reportedly, U.S. GOV faces a funding shortage of $213 trillion, most of it connected to promised benefits to the elderly. (Kotlikof)
The State already takes 50% of our earnings. It is doubtful that they can squeeze out much more. The other problem is that the welfare State de-motivates people.
The BLS reports that 96,157,000 people are not in the labor force.
The BLS reports that 90,922,000 don't want a job.

The bankers are squeezing ever-harder on a falling number of workers. Fewer people are having children. Suicide is way up. Family mental health is terrible as evidenced by drug addiction. The birth rate is still dropping.
To make matters worse, pollution from endocrine disrupters is crashing fertility.
"The paper in question was a meta-analysis of 185 studies and the largest of its kind. In a nutshell, men in many areas of the world are producing less semen overall, and the semen they do produce contains fewer sperm. What’s worse, the researchers found no evidence to suggest this downward trend is levelling off. As noted by GQ:

“Sperm counts went from 99 million sperm per milliliter of semen in 1973 to 47 million per milliliter in 2011, and the decline has been accelerating. Would 40 more years — or fewer — bring us all the way to zero?”
https://articles.mercola.com/sites/a...fertility.aspx
Phthalate pollution is bad enough. Unfortunately, it isn't the only problem. Here is a graph of projected autism rates.
http://sciencebasedmedicine.org/wp-c...200.jpg?4f48ab
So, what are we doing about this?
Autism Cases on the Rise; Reason for Increase a Mystery
Between vaccines and glyphosate, we are destroying what few children we do have.
The moneyed class and the socialists destroyed both the family and, reproduction. They also destroyed confidence. The developing police / surveillance State will just make things worse. No credit bubble can survive a falling population .

[Danny B]

Anatomy of the 2007 event

I saw the crash coming in summer of 2005. I started writing about it in May of 2007. https://eplaya.burningman.org/viewtopic.php?t=19613
Here is an excellent article with great perspective. I will do excerpts but, you should read the whole article.
"It came on the tenth anniversary of what most experts consider to be the true start of the global financial crisis—the moment on August 9, 2007, when the French bank BNP Paribas announced that it was freezing three of its investment funds "
"The trouble began in 2007 with a downturn in U.S. and European real estate markets; as housing prices plunged from California to Ireland, homeowners fell behind on their mortgage payments,"
No mention that our wages had crashed

"Although more banks failed during the Depression, these failures were scattered between 1929 and 1933 and involved far smaller balance sheets. In 2008, both the scale and the speed of the implosion were breathtaking. According to data from the Bank for International Settlements, gross capital flows around the world plunged by 90 percent between 2007 and 2008. "
We're still just getting warmed up.
"As capital flows dried up, the crisis soon morphed into a crushing recession in the real economy. The “great trade collapse” of 2008 was the most severe synchronized contraction in international trade ever recorded. Within nine months of their pre-crisis peak, in April 2008, global exports were down by 22 percent. In the United States between late 2008 and early 2009, 800,000 people were losing their jobs every month. By 2015, over nine million American families would lose their homes to foreclosure"

"The collapse could easily have devastated both the U.S. and the European economies had it not been for improvisation on the part of U.S. officials at the Federal Reserve"
Give it time. Devastation is waiting in the wings.

"One of the more common tropes to emerge since 2008 is that no one predicted the crisis."
Au contraire, https://www.zerohedge.com/news/2018-...alled-last-one
"What U.S. authorities were facing was not a Sino-American meltdown but an implosion of the transatlantic banking system, a crisis of financial capitalism. "
The bubble that was created was in no way related to capitalism.
"In September 2008, the Republican-led House of Representatives voted against the Bush administration’s bailout plan to save the national economy from imminent implosion "
The bailout was necessary to give prudent people time to get prepared for the eventual unwinding.

"What turned 2008 into the worst banking crisis in history was a new business model for banks. Traditionally, most banks had funded their operations through what is known as “retail” banking, in which consumers lend money to banks in the form of deposits, which banks use to make loans. Beginning in the 1980s, however, banks across the world increasingly moved toward “wholesale” banking, funding their operations through large, short-term loans from other financial institutions, such as other banks and money market funds."
Sounds incestuous to me.

"The shutdown in bank funding quickly rippled across the global financial system, even reaching Russia and South Korea, countries remote from the subprime debacle but whose banks relied on the same wholesale markets now under stress. The world was witnessing a trillion-dollar, transnational bank run." For dollars.
"The Bank for International Settlements estimated that all told, by the end of 2007, European banks would have needed to raise somewhere between $1 trillion and $1.2 trillion in order to cover the gaps on their balance sheets between dollar assets and dollar funding."
You can see why Bernanke had to send them many $trillions. A freeseup that sudden would result in the death on many millions. "They" bought some time for prudent people to prepare themselves as best as they could.

"For the Fed to be acting as lender of last resort to foreign banks was no doubt unusual, but these were desperate times, and it needed to avoid a European fire sale of U.S. assets at all costs. As the crisis intensified, however, the Fed’s leaders found that simply providing the European banks with access to the Wall Street liquidity programs would not be enough. Their funding needs were too great, and they lacked sufficient high-quality collateral"
"between December 2007 and August 2010, the Fed provided its Asian, European, and Latin American counterparts with just shy of $4.5 trillion in liquidity, of which the ECB alone took $2.5 trillion. That the European banks’ giant funding gap did not escalate into a full-blown transatlantic financial crisis is thanks in large part to these swap lines. "
Once again, there were a lot of lives at stake.

" The world’s central banks effectively became offshore divisions of the Fed, conduits for whatever dollar liquidity the financial system required. The Fed, that is, made itself into a global lender of last resort. Whereas before 2008 many had expected an imminent dollar selloff, the crisis ended up confirming the centrality of the Fed to the global financial system."
https://www.foreignaffairs.com/artic...nancial-crisis
You can see why the R.O.W. wants to get free of dollar funding.

"By the eve of the 2008 crisis, global financial markets dwarfed the global economy. Those markets had tripled over the previous three decades to 347 percent of the world’s gross economic output, driven up by easy money pouring out of central banks. That is one major reason that the ripple effects of Lehman’s fall were large enough to cause the worst downturn since the Great Depression."
"Today the markets are even larger, having grown to 360 percent of global G.D.P., a record high. "
"Central bankers and other regulators have largely succeeded in containing the practice that caused disaster in 2008: risky mortgage lending by big banks. "
Auto loans and student loans are a much bigger bubble than sub-prime housing was.
"Among corporations listed on the S.&P. 500 index, debt has tripled since 2010 to one and a half times annual earnings — near the historic peaks reached during the recessions of the early 1990s and 2000s. And in some parts of the bond markets, debt loads are much higher."
https://www.nytimes.com/2018/09/18/o...ets-crash.html

[Danny B]

RE in danger in the next downturn

9/18 Mortgage lenders may again lower standards as applications drop, Citi says – MW
9/19 Cash-strapped Americans forced to borrow against their homes – Bloomberg
We've seen this movie before.
9/19 China says won’t weaken currency to boost exports, as U.S. tariffs mount – Reuters
The markets will control the Yuan, Not the PBOC.

the median retirement account balance among working individuals was found to be $0.
https://www.zerohedge.com/news/2018-...ved-retirement
"One of the most perverse consequences of the central banks "saving the world" (i.e. saving banks and the super-wealthy) is the destruction of low-risk investments: we're all speculators now, whether we know it or acknowledge it. "
"In the late 1990s, the stable, boring market for mortgages was fully financialized and globalized, turning a relatively safe investment and debt market into a speculative commodity. We all know the results: with the explosion of easy access to unlimited credit via HELOCs (home equity lines of credit), liar loans (no-document mortgages), re-financing, etc., the hot credit-money pouring into housing inflated a stupendous bubble that subsequently popped, as all credit-asset bubbles eventually do"

"The "safety" of investments in housing, commercial real estate, stocks, corporate bonds, emerging markets, etc., is illusory: these are now inherently risky markets,"
"You get the point: virtually every supposedly low-risk asset class is actually a super-risky, super-dangerous bubble. "
The article had great graphs showing the housing bubble to be greater than 2007.
https://www.oftwominds.com/blogsept1...ators9-18.html

Carbon energy trading is moving to the blockchain. Maybe to avoid the dollar.
https://oilprice.com/Latest-Energy-N...-Platform.html

[Danny B]

Big party in October,,,hot money in RE

I'll start wit Armstrong because he has the most pressing news.
"This is what the Reversal System was designed for. To be objective in the midst of total chaos and uncertainty. November is shaping up as a Panic Cycle in the Euro, not in the share market. In the Pound, we have a Directional Change and a Panic Cycle in October. "
"We are looking at everything starting to get crazy in sovereign debt issues globally beginning in October. With the Dow Jones Industrials now making a new high for the year, the Fed will be looking more comfortable about raising rates to help the pension fund crisis that is brewing. So pay attention to interest rates in October!!!!!!!!"

"There is complete political chaos everywhere you turn. This is not simply supporting or bashing Trump. We are fooling here with the very foundation of CONFIDENCE in the governmental system. "
" What I mean as to this is the worst I have personally seen in 40 years is that we have uncertainty absolutely everywhere globally. There is no safe place for capital to hide. "
https://www.armstrongeconomics.com/m...t-in-40-years/

"ANSWER: Regardless of your political persuasion be it for or against any of these political issues, the importance is really the impact upon CONFIDENCE. If you are for or against Trump, we still have one thing in common. We just want stability and some sense of the future to bank on."
The deep state is absolutely determined to drag down Trump regardless of the fallout. I very much doubt that they are aware of just how much blowback will occur.
" If Italy pulls the cord to get out, the Euro cannot survive. What I hear from Behind the Curtain is that the ECB may be forced to cut its bond purchases by 50% and there are even those demanding Quantitative Easing MUST end by the end of the year."
Will lega Nord and 5 Star back down on their new budget? I doubt it.

" So, there is no point in getting all uptight for or against Trump, Theresa May, or any Juncker in Brussels. The computer does not show that ANYONE will be able to reverse the direction we are headed into. This is merely our fate. we have nobody on either side of the aisle who has a clue of what needs to be done or what is coming around the corner. So, look at this objectively. This is about understanding what is behind the trading strategy. That’s it. Nothing more. Nobody can save the day. We have to save ourselves. "
PLANT A GARDEN
https://www.armstrongeconomics.com/i...of-volatility/

OK, Armstrong is showing tremendous panic in European sovereign bond markets.
Here is a short article on sovereign bonds, https://gainspainscapital.com/2018/0...to-its-needle/
"Because the entire move in the financial markets since 2008 has been based on Central Banks cornering the bond market. In the simplest of terms, Central Banks dealt with the crash in one major asset class (housing) by creating a bubble in another even more senior asset class (government bonds).

Because these bonds are the backbone of the current financial system, (the senior-most asset class), when they went into a bubble, everything followed."

Nomi Prins, "From 179% before the financial crisis, the global debt-to-GDP ratio has jumped to 217% today.
Eliminating all that debt is the ultimate solution for avoiding another crisis."
If you eliminate the debt, you ELIMINATE the money supply.
"Central bank credit, or what I call dark money, tended to go to the wealthy and into financial assets.

“Dark money” comes from central banks. In essence, central banks “print” money or electronically fabricate money by buying bonds or stocks. " "That dark money goes to the biggest private banks and financial institutions first. From there, it spreads out in seemingly infinite directions affecting different financial assets in different ways."
"What all of this means that the Fed will either stop its current tightening program, re-invoke QE, or get its central bank allies to do the same when necessary. It means that further rounds of quantitative easing (through various dark money ploys), in addition to all the help they’ve received, will continue. The banks can see no other option."
Everybody assumes that the FED will hyper-print again. I am NOT convinced that this will happen.
https://dailyreckoning.com/10-years-...uilding-again/

" the net worth of US households rose to an all-time high $106.9 trillion, increasing for 11 consecutive quarters and up $2.2 trillion as a result of an estimated $559 billion increase in real estate values, "
YES, they have driven RE out of reach for millions.
"Total household assets in Q2 rose $2.3 trillion to $122.7 trillion, while at the same time total liabilities, i.e., household borrowings, rose by only $132 billion from $15.6 trillion to $15.7 trillion, the bulk of which was $10.2 trillion in home mortgages. "
All of this increase was due to speculators buying up housing with hot money. The owner-occupancy rate has not gone up.
Tyler Durden Blog | Household Wealth Hits A Record $107 Trillion... There Is Just One Catch | Talkmarkets

9/21 Japanese exchange hack results in 6,000 bitcoin stolen – MarketWatch
9/20 Italy’s 5-Star keeps up pressure on economy minister over budget – Reuters
Lega Nord has a gun to one side of his head. The ECB has a gun to the other side of his head.

[Danny B]

Jim Willie,,,, unemployment BS

Time to revisit Jim Willie. He may not be a fountain of truth but, he often knows which way the wind blows.
June 23, "Deutsche Bank integrally tied to the Italian banking system bust, their tight connection to the LTCM 1998 failure which lost the Italian central bank gold (Rickards crime scene & coverup by Draghi), two trigger events to set off the global financial crisis which will release the controlled Gold market (like DBank/ Italy failure plus Gold Trade Note launch in Shanghai), the fraudulent basis for the entire Euro Monetary Union with excuse for Italy to exit "

June 28, "the Trump persona to scuttle NATO, the Eurasian Trade Zone formation & SCO protection, the TPX triumvirate to execute the Global RESET as in Trump Putin Xi, the India & Pakistan detente for the ETZone in its southwestern region, the Petro-Yuan oil settlement with respect to the Gold Standard coming into view, the two key trigger events that release the Gold market from 25 years of suppression (DBank & Italy collapse,"

July 5th: topics covered include the assured failure of Deutsche Bank and the guaranteed collapse of the Italian banking system with French falling dominoes in contagion.
Aug 4 " the bond market expansion with potential forced pension investment in Special USTreasury Bonds, the emerging Systemic Lehman Event in a global financial crisis during the climax global breakdown underway, as nothing was resolved since 2008 while all major sovereign bonds have turned subprime and many banking systems in ruins,
"United States must source the gold for a new gold-backed currency with the ongoing concurrent risk from the $600 billion trade deficit, which must be eliminated, or else the USA falls into the Third World"

Sept 9 "then also a walk down statistical corruption lane on Consumer Price Inflation falsification with its immediate impact of exaggerated GDP economic growth as the USEconomy has endured 12 consecutive years of strong ugly recession,"
"then also the America First movement of dismissed US Pentagon Generals who defended the country against the globalist and narco baron attacks, which later become the core Trump support basis cited in his inauguration,"
"trigger events for the Global RESET like Italian banking bust, Deutsche Bank failure, Turkey banking bust, "
"all Emerging Market nations are mired in crippling severe currency crisis, then also a walk down statistical corruption lane on Consumer Price Inflation falsification with its immediate impact of exaggerated GDP economic growth as the USEconomy has endured 12 consecutive years of strong ugly recession,"

"The USFed has caused every financial crisis since the 1980s. Both outsourcing of US industry and QE monetary policy assure more crises. The actual price inflation is over 8%, thus the lie on GDP is over 5%, and therefore the USEconomy is stuck in a 12-year recession. The debt engine is broken, since it takes $5 in new debt to create $1 in economic activity. Except the reality is that the new debt only reduces the impact of endless recession. "
"road to the Gold Standard. It is the inevitable solution, surely to be adopted even by the Basel group of franchise central banks. This time around the entire globe is participating with national breakdowns in the crisis. Call it the Everything Bond Bubble or the Systemic Lehman Event. "
GOLDEN JACKASS.COM - The Golden Jackass Knows Gold, Currencies & Bonds"
The CBs did NOT want to do all that printing. They got their mandate from the State. PRINT to save sovereign debt.

Now for the propaganda. The FED is desperate to raise rates so that it
can lower them when the next crash hits.
Fed's Powell between a rock and hard place: Ignore the yield curve or tight job market?
"nemployment near a 20-year low screams at the U.S. Federal Reserve to raise interest rates. Which path they follow will begin to define whether Chairman Jerome Powell engineers a sustained, recession-free era of full employment, or spoils the party with interest rate increases.
” They see four increases likely next year, "

"New York Fed President John Williams deemed the current situation of continued growth, steady jobs gains and modest, close-to-target inflation “as good as it gets”
Unemployment is 4.1 % but, there are 96.1 million who are not in the labor force.
https://www.bls.gov/web/empsit/cpseea38.htm
Great graphic on GOV spending, https://www.zerohedge.com/news/2018-...ing-60-seconds

[Danny B]

Brexit, the Death Star

Americans tend to focus inwardly. That just isn't enough these days.
November is shaping up as a Panic Cycle in the Euro, not in the share market. In the Pound, we have a Directional Change and a Panic Cycle in October. " Armstrong
About that panic cycle., Brexit won’t be over by 29 March 2019.
Britain will legally leave the European Union on that date.
Teresa May went to the EU with a plan.

*MAY: NO DEAL IS BETTER THAN BAD DEAL
*MAY SAYS UK, EU AT AN IMPASSE
*MAY: MUST CONTINUE TO PREPARE OURSELVES FOR NO DEAL
*MAY: WILL NOT OVERTURN RESULTS OF REFERENDUM
https://www.zerohedge.com/news/2018-...ck-brexit-plan

Things are just not working out, https://www.spectator.co.uk/2018/09/...-blind-brexit/
Several articles on the subject.
https://www.independent.co.uk/topic/hard-brexit
Don't forget the Irish, https://www.express.co.uk/news/polit...u-leo-varadkar

Nor, the Scottish, https://www.express.co.uk/news/uk/10...affic.outbrain
About that panic cycle. November is shaping up as a Panic Cycle in the Euro
The Brits are trying to get out of the EU before the Eurozone banks crash.
In the Pound, we have a Directional Change and a Panic Cycle in October
So, the Pound does a big change in October and the Euro goes into a panic in November. Do the European banks crash in November? Does Draghi stop QE in November? Do the Italian banks crash in November?
Tusk is playing hardball with May. The rumors say that QE absolutely must be stopped by December. Hardball comes to an end when the Italian banks are a smoldering ruin and capital is fleeing.

[Danny B]

Monetary vs fiscal policy,,,Italy,,,Reduction of wars

After the S&L crash, 1,000 people went to jail. Regulatory capture got all the laws changed so that this wouldn't happen again. Moral hazard was removed. This was part of what allowed excessive leverage at the banks. When Greenspan allowed and, sponsored FED backing for the big gamblers, this removed financial hazard. Greenspan claimed that the bankers would manage themselves to be most profitable,,, and therefore safe. He was shocked when it all blew up. It seems that the banks had a group interest in survival. BUT, the individual at the trading desk was trying to ensure personal riches and survival.
This did not align with what was best for the bank. By then, it was too late. Each bubble had to be succeeded by a bigger bubble. Since the State was the biggest borrower, it was in the best interest of the State to force the Central bank to continue to buy it's bonds. It could roll them over ad-infinitum.
The Central bank did not like this at all. It wanted the State to cut back on expenditures.

Monetary policy is primarily concerned with the management of interest rates and the total supply of money in circulation and is generally carried out by central banks such as the U.S. Federal Reserve. Fiscal policy is the collective term for the taxing and spending actions of governments.Jan 8, 2018
What's the difference between monetary policy and fiscal policy

Bernanke complained about a complete lack of discipline in the fiscal policy. The 2008 crash hit primarily because the banks made loans to people who couldn't pay for a house. In the runup, the State had DEMANDED that they make this type of loan. The banks counted on a bailout right from the start.
Along came the 2008 crash. All moral and financial hazard had previously been removed. The world CBs were forced to bail out the bankers. Many millions would have died. Congress passed a couple of scam laws that were supposed to bring a return of moral and financial hazard. The party was in full swing and, the laws were neutered.
At this late date, we have learned that the quantity of money theory is NOT valid. The Germans did an admirable job of proving once again that austerity does not work. Bad news for the Greeks.

There is still no moral and financial hazard. The crash has been postponed but, we are reaching the limits. Fiscal policy has blown out ALL limits and rationality. The CBs blew the bubble and now, regret it. The debt is growing exponentially and the State doesn’t have a plan to stop that. The U.S. debt blew past $21 trillion and, nobody seemed to remark on this.
AT THE MOMENT, there seems to be no limit on people buying all this federal debt. at some point, this will change.

"The historic federal government borrowing binge runs unabated. Federal debt rose SAAR $1.186 TN during Q2, huge borrowings yet down from Q1's blistering SAAR $2.828 TN. For the quarter, Federal Expenditures were up 6.0% y-o-y, while Federal Receipts were down 2.0%. Over the past year, outstanding Treasury Securities increased $1.292 TN to a record $17.091 TN. Since the end of 2007, Treasuries have ballooned $11.040 TN, or 182%. "
" Combined Treasury and GSE Securities expanded to 128% of GDP (vs. 92% at the end of '07"

" the greatest inflation has been in the securities markets. Total Debt Securities (TDS) were up $2.111 TN over the past year to a record $43.982 TN. TDS ended the quarter at 215% of GDP, "
"Total (Debt and Equities) Securities jumped $7.251 TN over the past four quarters to a record $92.396 TN, or 453% of GDP. "
https://creditbubblebulletin.blogspo...1-flow-of.html

Italy, "With the government of the anti-establishment Five Star and the anti-migrant League party setting new public finance and economic growth targets, tensions are rising within the cabinet as both organizations seek funds to deliver on campaign promises including a “citizen’s income” for the poor, tax cuts and rolling back pension reform. The government is due to present a draft 2019 budget for inspection to the European Commission in Brussels by mid-October."
https://www.bloombergquint.com/onweb...ike#gs.WMsLnmA
So, the Italian Central bank is in a wrestling match with the Italian government.

As expected, older Americans are getting hit hard, https://www.marketwatch.com/story/ma...?siteid=YAHOOB

I tell everybody to have some cash at home and, PLANT a garden.
Stockman, Martenson and Kunstler recently presented a summit.
"For manifold reasons that are multiplying fast. So many, in fact, that each of the key speakers at the recent Peak Prosperity/Contra Corner Summit in New York City had difficulty finding enough time to enumerate them all during the six-hour event."
"Chris Martenson built on Stockman's evidence of the economy's vulnerability by showing how there simply won't be enough (net) energy in the coming decades to power the growth the world is counting on. To drive this point home, he explains how demand from China alone is on track to consume 100% of world oil exports by 2040"

"Here's (part of) Stockman's explanation of why he predicts the Federal Reserve and other central banks will be unable to prevent the next market crash, which he sees coming soon"
The common theme amongst Stockman, Martenson and Kunstler? Use the precious time we have today to fully understand the trends in play, take prudent preparation in advance of the coming crisis, and develop trusted bonds within a like-minded community well-positioned to help its members through future adversity."
https://www.peakprosperity.com/blog/...hat-comes-next

9/23 Despite the economic recovery, student debt crisis has only worsened – CNBC No kidding. They loaned money so that kids could get an over-priced education to prepare for jobs that just aren't there.
https://www.youtube.com/watch?v=YbrfQaHsC6U&t=223s
9/23 Major Indian “shadow bank” defaults – Bloomberg
I travelled by road through India. They have a bunch of things holding them back. Many Indians long for the days of the British Raj running the show.
9/23 Hurricane Florence damage 10 times worse than expected – Zero Hedge
Only 3% had flood insurance. They can't rebuild.
Gerald Celente has some interesting speculation.
"Gerald Celente: Yeah. We think that Trump is going to play another peace card, possibly with Afghanistan. We're going on, what? It's going to be a 18 year war. And no end in sight. And there's just a dump of money going into it. And also, probably pulling out of Syria, and more positive peace deal with North Korea. And we believe that's going to happen before the mid-terms to give the Republicans a boost. And he's even speaking out more and more about the useless wars in the Middle East."
http://news.goldseek.com/GoldSeek/1537560382.php

Something else of interest. Google should have been more careful of antagonizing Trump. He could easily whack them up the side of the head.
https://thehill.com/policy/technolog...d-examine-tech

[Danny B]

Buybacks and fleeing insiders

9/24 Rudy Giuliani: “We’re going to overthrow Iran” – Mish
And
9/24 OPEC, Russia rebuff Trump’s call for immediate boost to oil output – CNBC
The war hawks can't attack Iran and remove their oil production if OPEC and Russia won't bump up outside oil production. Iran was last on the list of States to be invaded. Everyone knows that Russia would have been number 8. It really does NOT matter. An attack on Iran would bring a shutdown of 80% of the oil supply for the West. Iran could be destroyed at the expense of; a complete economic crash in 90% of the world.

"The primary reason why stock prices have been soaring in recent months is because corporations have been buying back their own stock at an unprecedented pace. In fact, the pace of stock buybacks is nearly double what it was at this time last year. According to Goldman Sachs, S&P 500 companies spent 384 billion dollars buying back stock during the first half of 2018. That is an absolutely astounding number. And in many cases, corporations are going deep into debt in order to do this."
"So in the end, stock buybacks are often all about greed. It is a way to funnel money to those at the very top of the pyramid, and those stock market gains are taxed at capital gains rates which are much lower than the rates on normal income."

"It is being projected that firms will spend more than 600 billion dollars on stock buybacks during the second half of this year, and that will bring the grand total for 2018 to more than a trillion dollars…"
"the previous annual record for stock buybacks was just 589 billion dollars in 2007.
This year, we may come close to doubling the previous record."
"As I noted earlier, corporate insiders greatly benefit from stock buybacks, and they took advantage of massively inflated stock prices by selling off $10.3 billion worth of their shares during the month of August."
Buybacks are used to inflate the price. When it is inflated to a peak, the insiders sell out.
"Inflating your stock price by cannibalizing your own shares is not a good long-term strategy for any corporation"
Once again,we see a divergence between what is good for a corporation and,,, what is good for individuals in the corporation.

"Wall Street is inhabited by con men that are promoting Ponzi scheme after Ponzi scheme, and it is only a matter of time before the entire system collapses under its own weight."
"In 2007 corporations were pouring hundreds of billions of dollars into stock buybacks, and it propped up the market for a time. But eventually the bubble burst and the crisis of 2008 was so dramatic that it will be remembered forever.

Now we are facing a similar scenario, and it is just a matter of time before this bubble bursts as well."
Stock Prices Are Surging Because Corporations Are Spending More Money On Stock Buybacks Than Anything Else

" the results are likely be very different from 2008 — corporate meltdowns rather than mortgage defaults, and bond and pension funds affected before big investment banks."
But what would be the trigger for said corporate meltdown?
According to a new report from Goldman Sachs, the most likely precipitating factor would be rising interest rates"

" Companies have announced them this year at a rate of more than $5 billion a day. The buyback boom has been viewed by investors as a sign of confidence among CEOs.

Yet with their own money, executives are quietly taking a much different approach: They're cashing out.
Insiders dumped $8.4 billion of their shares in May and $9.2 billion in June, according to an analysis of regulatory filings by TrimTabs Investment Research. That's the biggest two-month period of insider selling in a year.
"They're buying back from the front door, and shoveling shares out the back door,"
https://money.cnn.com/2018/07/17/inv...cks/index.html
A couple of notes on Brexit.
https://www.independent.co.uk/news/u...-a8550186.html
https://www.reuters.com/article/us-b...-idUSKCN1M12RD
Investors don't like uncertainty and, you can expect the Pound to get weaker.

The chosenites are on a tear.
"The Israeli government has recently claimed that it can “legislate anywhere in the world”, that it is “entitled to violate the sovereignty of foreign countries”, and that “is allowed to ignore the directives of international law in any field it desires”. This was written in an official response letter to the Supreme Court last month."

https://mondoweiss.net/2018/09/legal...international/

9/24 Beware zombies: BIS warns non-viable firms are crippling growth – ZH
Maybe so but, they are keeping people employed..
9/24 Venezuela’s Maduro looks to China for bailout – Oil Price
He already burned through the cash that he got from Russia.
9/24 This is the “last free generation” says Julian Assange – Zero Hedge
It is worse in China, https://www.youtube.com/watch?v=OQ5LnY21Hgc

[Danny B]

Nobody knows where all the money goes

Regulatory capture allowed bankers to run to great excesses of exploitation. Now, that it is all falling apart, socialism raises it's ugly face. How convenient. It has always failed before but, it will be different this time. The surveillance state combined with the police state will make sure that we all conform and pay the state every penny that it demands.
China has never been reluctant to try new social experiments. Their one-child policy is a good example. Chairman Mao had a bunch of ideas that just didn't work out. China is now experiencing a huge amount of social unrest.
They have 200 million cameras and lots of AI watchers. They have 1 million in camps.
https://www.theatlantic.com/internat...llness/568525/
China has to print enormous amounts of liquidity to keep everyone employed. I think that Trump is counting on internal strife to bring down China.

The MICC would very much like to sweep an elephant under the rug.
"The report indicated that in fiscal 2015, the US army (with a budget of roughly $122 billion) had adjustments of $6.5 trillion."
"They found documents indicating a total $21 trillion in undocumented adjustments over the 1998-2015 period, of which $11 trillion were directly linked to the US Army."
"By October 5, 2017 they suddenly discovered that the link to the original OIG report “Army General Fund Adjustments Not Adequately Documented or Supported” of July 26, 2016 had been disabled. Within several days, the links to other OIG documents that had been identified in their search were also disabled."
“In late May 2018, a graduate student at Michigan State University found on the OIG website the most recent report for the DoD, which summarizes unsupported adjustments for fiscal year 2017. However, this document differs from all previous reports in that all the numbers relating to the unsupported adjustments were redacted. That is, all the relevant information was blacked out.”

"one of the Pentagon’s largest agencies couldn’t account for hundreds of millions of dollars’ worth of spending, (curiously just as President Donald Trump was proposing a boost in the military budget.)"
Trying to stave off deflation at every level.
" With the increased spending included in this year's National Defense Authorization Act (NDAA), the Pentagon will get to spend more than $700 billion next year."
Reportedly, U.S. GOV spends 24% of the GDP. Armstrong claims 37%. Imagine the deflation if this missing $ 21 trillion had not been spent.
The FED pumps money into financial institutions and, the MICC pumps money into defence jobs.
https://www.zerohedge.com/news/2018-...ghostly-budget

As more and more monetary inflation comes to light, there is less and less confidence in FED GOV. Armstrong said that FED debt would crash going into 2020. Investors all know this and, are staying away from auctions that mature in that time frame.
https://www.zerohedge.com/news/2018-...ing-2y-auction
Remember that FED GOV locked him up for many years on bogus charges.

Jamie Dimon admits that Wall Street screwed us good but, we will get over it.
https://www.zerohedge.com/news/2018-...-street-crisis
All the money has flowed into passive investment funds. This has reduced volatility because nobody is minding the store. It is expected that the "algos" will cause a meltdown in the next downturn because they only respond. They don't think. The system is NOT set up to deal with a return of volatility.
https://www.zerohedge.com/news/2018-...-and-liquidity

"During the Great Recession, the debt climbed to over 100 percent of America’s GDP as the government spent to stimulate growth. Now the Great Recession is over, but the national debt will top 105 percent of GDP this year. Politicians talk about reducing the deficit, but each deficit increases the debt.

To carry $21 trillion in debt as it grows quickly to $33 trillion means astronomical interest payments each year. The interest payment on the national debt last year (with low interest rates) was a whopping $263 billion, but it would grow to almost $1 trillion dollars a year by 2028, larger than the annual budget for Medicaid and larger than the defense budget. The current economic growth will not solve the problem; it won’t even pay for the tax cuts that just got approved."
https://www.zerohedge.com/news/2018-...ional-security

Trump did a tax cut to buy some time. It will wear off in several months. He is hoping to be the last survivor when the emerging markets and Europe melt down. He has to drastically reduce military spending and, the MICC is fighting him all the way. He increases spending now because he knows that the money will never be repaid. The bid-to-cover ratio will continue to fall.

[Danny B]

Mor bumps in the road

9/26 Governments face debt time bomb; blue states are worst off – LifeZette
Just a coincidence.
9/26 Jim Grant – the calm before the storm: defaults ahead – Value Walk
You MUST believe a guy who only wears bow ties.
9/26 Report: ‘True cost of government’ has state $11.6 billion in the red – Florida Watchdog
They just forgot to mention a few details.
9/26 Uber drivers make $9.20/hour, half of what they earned four years ago – Zero Hedge

9/26 Bonds flashing a “late 2007” signal… remember what came next? – Graham Summers
Nope, I already forgot. Stocks are peaking and insiders are selling out. But, since YOU are in a passive investment fund, you signed up for the roller coaster ride to hades.
9/26 Default shock in India sees firms pulling most bonds in decade – Bloomberg
Get used to it.
9/26 Wealth of top 1% surpasses $100 trillion: more than global GDP – Zero Hedge
Yup, they have been snorting Viagra.
9/26 Tokyo Whale sells $230 million of bitcoin in Mt. Gox wind-down – Bloomberg
Yup, the big flashing sign that says EXIT.
9/24 B of A: Peak home sales has been reached – Zero Hedge
Just wait til the FED does 2 more rate hikes.
9/26 President Trump is ‘not happy’ with Fed’s decision to raise interest rates – CNBC
Yes, fiscal policy vs monetary pollicy.
9/26 Brexit agreement could come in October, Germany’s Merkel says – CNBC
Don't hold your breath.

9/26 Europe, Russia and China join forces to dodge Iran sanctions – CNBC
9/26 EU rebukes Trump, will create “special vehicle” to bypass US sanctions on Iran – Mish
9/26 Trump, Iran’s Rouhani exchange threats, insults on U.N.’s world stage – Reuters
9/25 Tensions grow as China, Russia and Iran move towards multipolar world – SC
Having the reserve currency eventually becomes a curse. The R.O.W. DEMANDS that we over-print so that they will have reserves. That leaves us with an enormous trade deficit AND unemployment. Why produce when you can just print? The R.O.W. is reluctantly abandoning the dollar. Trump is hurrying things along. He pushes everybody to abandon the dollar by sanctioning them. We will no longer be able to run our $1.5 billion a day trade deficit. We will actually have to work and produce the things that we previously paid for with green confetti.
The FED had to inflate the snot out of the dollar supply to meet the demand for reserves.
This monetary inflation created steady price inflation to where we could no longer afford houses and kids.
The jobs will return when the trade deficit comes to an end.

9/26 Default shock in India sees firms pulling most bonds in decade – Bloomberg
Bonds will eventually be ground zero.

"Free riding is one of the oldest problems in economics and in society in general. Simply put, free riding describes a situation where one party takes the benefits of an economic condition without contributing anything to sustain that condition."
"Eventually a tipping point arrives when there are so many parasites that the elephant dies. At that point, the parasites die too. It’s a question of short-run benefit versus long-run sustainability. Parasites only think about the short run."
Parasites NEVER think about death
"An active investor is one who does original research and due diligence on her investments or who relies on an investment adviser or mutual fund that does its own research. The active investor makes bets, takes risks and is the lifeblood of price discovery in securities markets."
"A passive investor is a parasite. The passive investor simply buys an index fund, sits back and enjoys the show"
Personal axe to grind.

"the following chart shows that this is exactly what is happening. Since 2009, over $2.5 trillion of equity investment has been added to passive-strategy funds, while $2.0 trillion has been withdrawn from active-strategy funds."
"Passive investors may be enjoying the free ride for now but they’re in for a shock the next time the market breaks, as it did in 2008, 2000, 1998, 1994 and 1987."
"The market crash will be like a runaway train with no brakes."
https://dailyreckoning.com/free-ridi...ajor-collapse/
The algos will roll like a snowball down a mountain slope. Nobody who is a passive investor will have any control.

How to Prepare For the Coming Inflationary Storm
https://gainspainscapital.com/2018/0...tionary-storm/
The storm will bring both inflation and deflation.
The closer an asset is to a must survival position, the more it will inflate. 1600% for farmland, bought up by investors, rather than farmers.
https://www.businessinsider.com/amer...armland-2018-9

All that FED hot money went into anything that could be considered a store-of-value. This has really screwed the millennials.
https://www.armstrongeconomics.com/w...ennial-crisis/
The EU / IMF is trying to scare Britain into remain, https://www.armstrongeconomics.com/i...ical-forecast/

[Danny B]

Flight from ZIRP,,,Rotten Rupee

Great news;
9/27 Final reading on Q2 GDP confirms 4.2% gain, the fastest rise in four years – CNBC
Not so great news;
Household debt grows at fastest rate in 11 years - MarketWatch 2018
The national debt is rising much faster than the economy - Business .. 2018

“A one point rise in rates adds $200 billion every year to the debt,”
9/27 Fed hikes interest rates, signals another increase in December – MW

It is amazing that the money gurus have followed such terrible theories. It looks like they are just trying to make a profit regardless of whether or not it brings down the whole system.
The Western CBs + Japan instituted ZIRP to make State debt easier to service. This killed interest income and bond income. THAT killed pension and insurance funds. The FED had to buy all the sovereign bonds, mostly through proxies. They did currency swaps with other CBs.

The other effect of ZIRP is; Investors went to undeveloped markets in search of yield on investment money. They pretty much ignored safety and stability. When the FED started tightening, this brought instability to EMs with all their dollar-denominated loans.

"India’s financial markets are in the throes of this Emerging Market crisis. The Mumbai-based Infrastructure Leasing & Financial Services (IL&FS) is an over 30-year-old infrastructure lending giant that claims to have helped develop and finance projects worth $25 billion in Asia’s fastest-growing economy. The company recently defaulted on debt payments because it ran out of cash."
"This is illustrating what we have been warning about. As interest rates rise and the dollar, the first casualty will be the Emerging Markets (EM). Because interest rates were driven to absurdly low levels in Europe and the USA, those who need yield ran off to the EM field."
Posted Sep 27, 2018 by Martin Armstrong

Central Banks cannot manage the economies anymore. We live in a porous global economy. The Fed buying back 30-years bonds to lower real estate loan yields was absurd. The false assumption was that only American owned such debt. But the dollar is the reserve currency. That meant that more than 40% of such debt resided outside the USA. Central Banks can no longer manipulate the economy using the demand side economic models. They drove capital rushing into the EM sector desperate for yield "
"This is why we have a serious debt crisis on our hands. The greenback is STILL going to press higher against the rupee. Just look at the pattern. This is NOT an isolated high. We are looking at a significant rally still on the horizon for the dollar."
No matter how screwed you think American markets are,,,, most others are worse.
https://www.armstrongeconomics.com/i...market-crisis/

"Many discounted the proposal as being far too aggressive: after all, a direct assault on SWIFT, and Washington, would be seen by the rest of the world as clear mutiny against a US-dominated global regime, and could potentially spark a crisis of confidence in the reserve status of the dollar, resulting in unpredictable, and dire, consequences."
"Trump's latest sanctions on Iran, and as a result, late on Monday, the European Union said that it would establish a special payment channel to allow European and other companies to legally continue financial transactions with Iran while avoiding exposure to U.S. sanctions."
Just as much as the sanctions, Europe would very much like to bypass the leeches in the NYC banks that process all the dollar traffic.
https://www.zerohedge.com/news/2018-...ollars-reserve

"Paul Wolfowitz, a key player in America’s invasion of Iraq, had warned back in 1992 in a secret memo to Defense Secretary Dick Cheney that “our strategy must now refocus on precluding the emergence of any potential future global competitor.”
Yes, the chosenite who is controlling our destiny.
"During Obama’s administration, they were pushing aggressive policies by expanding NATO to encircle Russia and devising a strategy for the economic containment of China."
"China’s President Xi, speaking at the G20 conference two years ago, warned that “we can no longer rely on fiscal and monetary policy alone,” and called for spreading visionary and inclusive economic growth driven by innovation in science and technology"
WAIT, what if we want war?

"Forget NATO. We need a new world alliance to take on totalitarian capitalists in Russia and China.’ Heath continued: “NATO is no longer enough: it is too European, too many of its members are outright pacifists It would dramatically shift the global balance of power, and allow the liberal democracies finally to fight back. It would endow the world with the sorts of robust institutions that are required to contain Russia and China…”
robust institutions That is political speak for even more expensive weapons systems.
https://www.rt.com/op-ed/439496-us-past-trump-empire/
Trump is anti-globalism. He would like the world to stop using the dollar.
https://www.realclearpolitics.com/vi...vereignty.html

[Danny B]

10 year note,,, interest burden vs birth rate

First, and most importantly, a graph of the 10 year note.
https://gainspainscapital.com/wp-con.../GPC926181.png
And most importantly, the Fed stated it would likely hike rates again in 2018… with another three rate hikes in 2019. If each rate hike were for 0.25%, the Fed is targeting an interest rate of 3.25% before it’s done.

Why is the Fed acting so aggressively? Remember, both the Bank of Japan and the European Central Bank are running NEGATIVE interest rates while also engaging in Quantitative Easing policies.

Meanwhile, the Fed is planning a total of 12 rate hikes before it’s finished… while engaging in a Quantitative Tightening program that would drain an amount equal to Sweden’s GDP from its balance sheet every single year.
Why is this?
Because the Fed is trying to get the bond market under control.
"The yield on the 10-Year Treasury bond, the single most important bond in the world, has broken a multi-decade downtrend. If this does not reverse soon it means the 30+ year bull market in bonds is OVER."
https://gainspainscapital.com/2018/09/27/9685/
Armstrong said that U.S. sovereign debt would collapse going into 2020. So, is Powell just pissing into the wind?

You should read this entire article but, I will do excerpts.
"Accordingly, I contend here that interest rates do negatively affect fertility rates, which if go unchecked can have disastrous effects on nations and the culture of their peoples in the long run. Accordingly, it may be beneficial for nations to consider interest-free financing modes. "
"It is my strong view that nations that aspire to solve their shrinking population problem must first abolish their interest-based monetary and financial system and replace it with systems that are based on risk-sharing principles. I hope Europe, the US, Japan, Singapore and others that are faced with shrinking population problem would replace their interest-based monetary system with interest-free systems to ‘save’ their populations"
https://www.ahamedkameel.com/interes...ertility-rate/

The shrinking population problem is a slow grind down and down.
Impoverished by Central Bank inflation to keep all the bankers fat and happy, we can no longer afford to have children. This brings the demographic crash where fewer and fewer workers are supporting more and more elderly.
https://data.worldbank.org/indicator/SP.POP.DPND
"risk-sharing principles" This is the basis of Sharia-compliant banking.

Interest-free systems will not save the day. People had large families to get free labor. This is no longer necessary. The non-black world is voluntarily reducing their reproduction rate.
"Jul 1, 2016 - South Africa's white population is shrinking, down more than 70000 over the past five years, according to new data by Statistics South Africa"
" According to China's National Bureau, by 2013, the total fertility rate dropped to 1.55, below the world average."
China is using AI extensively to monitor and control every aspect of a person's life.
"China's social credit system was launched in 2014 and is supposed to be nationwide by 2020. As well as tracking and rating individuals, it also encompasses businesses and government officials. When it is complete, every Chinese citizen will have a searchable file of amalgamated data from public and private sources tracking their social credit. Currently, the system is still under development and authorities are trying to centralise local databases.

Given the Chinese government's authoritarian nature, some portray the system as a single, all-knowing Orwellian surveillance machine that will ensure every single citizen’s strict loyalty to the Communist Party."
"Jun 28, 2018 - China's social credit system will begin expanding past China's borders to monitor Chinese citizens wherever they are globally."

Big Brother in America isn't quite this intrusive. But, you can bet that people will be even more likely to refuse to bring children into such an ugly dystopia.
"In 2017, the country's total fertility rate was 1.6 children per woman,"
All things considered (including Japan), there is NO possibility of saving the current debt-money system. No confidence means,,, NO children.

[Danny B]

Italy BBQs the EU.,,, JPM and their special vehicle

I travelled through Italy on a camping bus. I watched the sunrise over Sorrento on the Amalfi Coast. I hiked around Capri and swam in the Blue Grotto. I really like the country. They have not grown their economy one bit since they were sucked into the eurozone. The Italians have finally said, ENOUGH,,, Ya Basta.
They have finally elected leaders who will tell the EU to shove it. This was NOT supposed to happen. The opposition parties were supposed to be too fragmented and disparate to ever come together. BUT, they did come together to save Italy.
The EU in their infinite wisdom has threatened Italy to put a stop to populism. RIGHT, that is going to go over real well.
https://www.breitbart.com/london/201...kill-populism/

They try to destroy Italy with Immigration (al la the Kalergi Plan),,, and expect the Italians to just get in line. The EU is determined to enforce German austerity on Italy.
The Italians have taken the attitude BURN, BABY, BURN.
https://www.dollarcollapse.com/itali...europes-bluff/

In for a penny,,,, in for a pound. The Italians are going full bore.
https://www.thedailybeast.com/italy-...l-basic-income
The Eurozone was supposed to be such a big improvement. The Italians saw what happened to Greece. The Germans did that to warn others who might think of leaving. They are trying to do the same with Britain. They plan to squeeze Hungary and Poland,,, maybe Austria. The new Italian budget is an unstoppable detonator.

Bloomberg says that the populists need to see reason. The Italians have been reamed by the bankers for years. THAT is all that Italians need to 'see'
https://www.bloomberg.com/view/artic...premium-africa
The bankers have a plan. They will cause a sudden stop to Italian credit. I'm sure that the Italians have a plan too. Sudden default.
https://www.bloomberg.com/news/artic...top-of-capital

Insiders did a $bazillion in buy-backs to drive up stock prices. Evidently, they believe that the peak has been reached. The insiders are going "outside".
https://www.cbsnews.com/news/insider...a-record-pace/

"The price managers in New York and Washington and London and Brussels and Tokyo and Beijing seem to all agree that citizens of all nations should be urged to avoid gold and trust paper currencies because of national security issues. The truth is that the paper merchants cannot charge a fee if your net worth is held in physical metal. Now that they control the Four Pillars of Commerce—banking, investments, insurance, and real estate—the big banks view gold and silver in a totally hostile view because these alternatives threaten to dissipate their power of monetary control, and if there is ANYTHING that will send a banker into a murderous rage, it is the mere THOUGHT of losing control of the "flow" of money, which they currently command and in spades. "

"war expenditures from WWI, WWII, Korea, and Vietnam pale by comparison. The costs of two world wars and the Asian wars were measured in billions of dollars while credit creation since '08 implemented to save the American banking establishment is being measured in the TRILLIONS. "

"As a means of managing the crisis, those who control markets decided to do away with highly volatile humans in the implementation of financial market "policy" and instead replace them with machines that could be programmed with responses to external event-driven stimuli easily controlled. In this manner, the new generation of investors do not react to the ringing of the Pavlovian dinner bell of rising inflation and domestic turmoil with gold purchases; they observe the past 10 years of gold performance versus stock, versus real estate, versus pot stocks, versus cryptocurrencies and simply jettison cash in favor of something—ANYTHING—not in the crosshairs of the central bank bazookas. "
https://www.streetwisereports.com/ar...ic-lesson.html

9/27 Europe, Russia and China join forces to dodge Iran sanctions – CNBC
9/27 EU rebukes Trump, will create “special vehicle” to bypass US sanctions on Iran – Mish
Think about this special vehicle that will essentially bypass SWIFT. This is a very big deal. It cuts out the NYC banks and SWIFT and, negates sanctions.
Where did this special vehicle come from???????
JP Morgan just launched the largest ever real-world blockchain application, developed to facilitate corporate cross-border payments.
There is no way to overstate the importance of this development. Russia has their "MIR" system and China also has a system. It looks like JPM is jumping to the front of the line of American banks.
https://www.zerohedge.com/news/2018-...in-application

I'm taking my BOV to my BOL and will be AFK for a few days.

[Danny B]

gold clause,,, definition of "funded"

I was gone for 3 days and now, I'm a week behind. When I first starting writing, the signs of trouble were not obvious. People really didn't care. That was before the 2008 crash. Since then the signs are more frequent and more obvious. While the stock market is purposely shown as a bellwether indicator, the bond market is far more important. The sovereign bond market is what keeps the State alive.
"The US gross national debt jumped by $84 billion on September 28, the last business day of fiscal year 2018, the Treasury Department reported Monday afternoon. During the entire fiscal year 2018, the gross national debt ballooned by $1.271 trillion to a breath-taking height of $21.52 trillion.
Just six months ago, on March 16, it had pierced the $21-trillion mark. At the end of September 2017, it was still $20.2 trillion. "
"the surge in the debt in fiscal 2018 of $1.27 trillion was 33% more than the already mind-blowing average surge in the debt over the past seven fiscal years"
https://www.zerohedge.com/news/2018-...s-215-trillion

Lest you have any doubts, the debt can't just keep growing like a giant Sequoia.

How did we get here? Bill Bonner claimed that 1/2 of the debt burden on the State is lifted off by price inflation. 50% of the pain is printed away. Where and when did that all start?
"Let’s begin by looking again at the connection between time and money.
If you work by the hour, the guy with money can buy your time. That’s what it really means to say someone is “rich” – he has more time because he can control not only his own, but yours, too.

The guy who had $1,000 worth of stocks in 1971 could buy approximately 250 of the average working man’s hours. Today, that $1,000 worth of stocks is worth about $28,000… which, at today’s $26-per-hour average, will buy 1,077 hours of the typical working man’s time – four times as much as in 1971.

In other words, compared to the wage earner, the capitalist is four times as rich.

Invert it, and you see about the same thing. A working man would have had to labor for 212 hours to buy the 30 Dow stocks in 1971. Today, his time is much less valuable; he has to sweat for 1,000 hours to buy the Dow.
For their part, investors, the rich, and the cronies and insiders thought they were smart. They earned their wealth fair and square, they believed, by funding America’s enterprises… and by carefully allocating precious capital to worthy businesses run by able corporate champions.
But the fix was in.
"In 1933, the matter first came before the Supreme Court. Franklin Roosevelt’s Executive Order 6102 made it illegal for citizens to own gold, except in the smallest of quantities.
Gold clauses in contracts protected them by insisting on gold as a means of settling up. Eliminating the gold clause meant taking away the ability to protect against inflation… and substantially altering the terms of the deal.
No definite delegation of such power exists; and we cannot believe the farseeing framers, who labored with hope of establishing justice and securing the blessings of liberty, intended that the expected government should have authority to annihilate its own obligations and destroy the very rights which they were endeavouring to protect.

Congress went along with it, too. And then, still in the minority, McReynolds saw the handwriting on the wall. The feds themselves might be the main beneficiaries. Congress would be able to borrow… and then wipe out its own debt by inflation:
“We are dealing here with a debased standard, adopted with the definite purpose to destroy obligations. Such arbitrary and oppressive action is not within any congressional power heretofore recognized.
For the government to say we have violated our contract, but have escaped the consequences through our own statute, would be monstrous. In matters of contractual obligation, the government cannot legislate so as to excuse itself.

With the gold clause out of the way, the coast was clear. The feds floated out one program after another, meddling in every aspect of human life.

There was now a third party in almost every transaction – the federal regulator.
By the 1950s, the fake wars had begun, too – major wars – with no declaration or funding from Congress.
Now, the feds had gone Full Paper. Their money was nothing but pieces of paper backed by what was soon to be the world’s biggest debtor.

And now, there was nothing stopping them… There was nothing to stop the chaos McReynolds foresaw.
https://bonnerandpartners.com/how-ex...oomed-america/

I sent this to Walter Burien at the CAFR1 site.
"TIA, a Chicago-based nonprofit dedicated to government fiscal transparency, analysed and graded all 50 state governments’ fiscal health based on their latest Comprehensive Annual Financial Report (CAFRs) filings."
"TIA maintains in its report that the state has not funded $10.9 billion in pension and $9.3 billion in retiree health care benefits.“The state has put no money aside to pay for those promises."
https://www.watchdog.org/florida/rep...515db8f1f.html

Here is the reply from Walter Burien.
"Understand the slight of hand:
The word: Funded???
Let's say you bought a house for $625,000. Well if you paid cash, is it funded? No it is not. You still have Property Tax each year and if that is not paid, the local government could take your house. So, if your property tax was $20,000 per year and you established an escrow account, put $400,000 in it that generated $20,000 per yer to pay your property tax, is your house Funded? Well, actually not. There is insurance; maintenance; potential liens, etc., etc. etc....
Then there is always the chance you did what most do. That being take out a mortgage for $625,000. So let's see, fully funded??? Here you would need the $625,000 + the Interest on a 30-year mortgage, let's say $310,000 + everything else noted above, then you would be fully funded.
When a state now looks at their System Pension funds, they project ahead 20 / 25/ 30 /35 years, determine what the costs will be then and what the pensioner will be making "then" to have on hand "now" to determined "fully Funded".
Gives a new meaning to: "The state has put no money aside to pay for those promises."
Now enter the clear showing of total on hand now; what is actually paid out now; and most important of all; the additions from participants over that 20 / 25/ 30 /35/40 years. Are they still 11 billion short, or after accounting for the additions from participants over that 20 / 25/ 30 /35/40 years, AND a normal rate of return base on standards, let's say 6.5%, does the word "over-funded" ring clear today after the slight of hand of not including the contributions and return over that 20 / 25/ 30 /35/40 years are accounted for?????"

Boston University professor Laurence Kotlikoff says that U.S. GOV has $213 trillion in unfunded future promises. According the the CAFR reports some 37,000 GOV agencies have $200 + trillion stashed away.
https://www.sco.ca.gov/Files-ARD/CAFR/cafr16web.pdf
Taking California as an example, about 50% of the money is in equities. So, 37,000 GOV agencies have $100 trillion stashed in stocks alone. How much are they earning? How about bond earnings?
The California University system reports that it has in excess of $90 billion. Just the same, they sell bonds to raise money fro building and maintenance.
We are continually squeezed so that the state can grow without limits.