Economic pressures

[Danny B]

Just a bit of panic,, so far

7/07 Redemption “panic”: 2 more UK property funds slash property values – Zero Hedge
7/07 Bond market is in an ‘epic bubble of colossal proportions’ – CNBC
7/07 “When Deutsche Bank goes to single digits, people will start to panic” – Zero Hedge
7/07 I’m in awe at how fast Deutsche Bank is coming unglued – Wolf Street
7/07 US Treasury rates have crashed to historic lows – Economy And Markets
The SKEW index shows that panic set in a while ago.

7/07 Gold assets top 2,000 tons as the clamor for havens grows louder – GATA. Gold has outperformed everything else. Treasuries are called "safe haven" but, every GOV eventually defaults.
7/07 Avoiding Europe’s next banking crisis – Bloomberg
7/07 Can the EU survive as a prison? – Mish Good question.

The SWIFT system connects all the banks. If there is a run on the banks, it will be electronic. Because of all the interconnections, "they" would have to close all the banks worldwide. That could get messy.

[Danny B]

Overshoot of the financial sector

The financial community depends on raking money off the top of the producing economy. Everybody wanted to get into finance and live off their interest income. This sector got increasingly crowded at the same time that the productive sector was shrinking from low-wage competition. The financial community is ALWAYS trying to goose the productive economy so that they can rake off a profit. The bankers are always trying to push the "wealth effect" so that we spend more regardless of whether or not we actually have more. America is dragging along $ 30 trillion more in debt than the economy can actually service. A little "wealth effect" is good but, MORE is NOT.
Along comes hormesis;
"Hormesis is a biological phenomenon whereby a beneficial effect (improved health, stress tolerance, growth or longevity) results from exposure to low doses of an agent that is otherwise toxic or lethal when given at higher doses.

The Bretton Woods agreement brought back gold as the flywheel that kept the financial system from over-speeding and blowing all to hell. It didn't actually bring back gold. It brought out a gold-linked dollar. The politicians push the PRINT button until they broke the linkage. There was no longer a "regulator" for currency creation. Pox Americana went right to work at creating an empire by hook and by crook,,, by blood and bombs.
Triffin's dilemma states that all States will demand the reserve currency to use as a store of wealth. We printed trainloads of dollars and never had hyperinflation because everybody demanded to hold dollars. They didn't just hold these dollars sterile in their vaults. They invested them right back in the American economy.
Japan sold us Toyotas and Hondas and then sent back hundreds of $billions to U.S. industry and GOV. "The reinvestment of dollar surpluses into dollar assets has facilitated reckless debt expansion in the United States"
The Disastrous Dollar Standard - The Daily Reckoning

"1. Italy’s banking system is on the verge of collapse. Nearly 20% of loans are non-performing (meaning garbage). This is not Greece. We’re talking about a €2 trillion banking system."
"3. China continues to devalue the Yuan at an annualized pace of 12% year to date. This is exporting a massive wave of deflation to the West.

4. The US Dollar has begun the next leg up in its bull market. The first leg crashed Oil, commodities, and emerging markets. This leg will crater US corporate profits and stocks as well."
The EVERYTHING Bubble: What's Coming Will Be Much Worse Than 2008 | Zero Hedge

FED GOV has locked itself into mandatory spending that is eating up the budget; https://mishgea.files.wordpress.com/...ng?w=803&h=647

https://mishtalk.com/2016/07/07/lacy-hunt-on-negative-multiplier-of-government-debt/

China is devaluing their currency at 12% a year. They are exporting deflation; World faces deflation shock as China devalues yuan at accelerating pace
This devaluation is expected to be a bigger shock than Brexit.

7/08 Brexit opens up bank fault line from Milan to Lisbon – Reuters
7/08 90% of June job gains went to workers 55 and older – Zero Hedge No confidence in pensions.
7/08 “Italian gov’t collapse more than just a possibility” – Mish
7/08 Forget Brexit, watch China and the Renminbi – ValueWalk
7/08 Japan needs fiscal stimulus to end deflation, Abe adviser says – Bloomberg NO, Japan needs more people.

" approximately 42,000 people are shot and killed in Brazil each year"

http://endoftheamericandream.com/archives/the-thin-veneer-of-civilization-that-we-all-take-for-granted-is-evaporating-all-over-the-globe

[Danny B]

Semantics and bail-ins

The laws are already in place for bank bail-ins by investors and depositors.
The banks "sweep" accounts as often as 28 times a month scooping up unused money for them to invest.
Your money is not called a deposit. It is an unsecured loan to the bank.
In the event of a bail-in, the depositor's money would be taken. Chances are, it was taken long ago. By calling your deposit an unsecured loan, the banks get out from under laws that were established in Roman times.
European Banks and Europe?s Never-Ending Crisis |
There is almost no actual capital left in Italian banks.
"Italian banks are sitting on €360 billion in non-performing loans " "Just one day after the Brexit vote, the ECB’s TLTRO II operation took place. Almost €400 billion were lent to euro area banks at negative interest rates." to pay off the old loans.

Delinquencies are climbing FAST; http://i1.wp.com/dollarcollapse.com/...size=550%2C370

2007 All Over Again, Part 5: Banking Crisis Imminent - DollarCollapse.com

7/09 Chicago on the hook for $24 billion net, triple a year ago – Chicago Business Socialism is expensive.
7/09 26 million Americans are now “too poor too shop” study finds – Zero Hedge
Our trade deficit is $ 45 billion a month. I would speculate that most of the money that is supposed to be in the banks has been sent offshore to pay for junk that is already in the landfill.

[Danny B]

Stacking dynamite under the banking industry

The Baltic Dry Index is the PRICE paid for dry shipping, not the volume. This price has crashed to where the shippers are operating at a loss. Deutches bank is heavily exposed to these losses and is trying to sell off the toxic loans.
"Deutsche Bank is looking to sell at least $1 billion of shipping loans"
"Deutsche Bank, which has around $5 billion to $6 billion worth of total exposure to the shipping sector, declined to comment" " Deutsche Bank Says World "Past The Point Of No Return" In The Default Cycle"

Deutsche bank isn't the only bank in trouble. "Bank Monte Paschi shares sparking a 10% bounce in the stock but CDS are unchanged implying a 66% chance of default."
EU Banks Crash To Crisis Lows As Funding Panic Accelerates | Zero Hedge
Deutsche Bank shares are trading at just 8% of their former high; Charting The Epic Collapse Of The World's Most Systemically Dangerous Bank | Zero Hedge
7/11 Deutsche Bank chief economist: “Europe is seriously ill” – Mish He must be looking in a mirror.

Europe has bean on a tear at borrowing money like there is no tomorrow. They make Americans look positively frugal. https://www.theautomaticearth.com/wp...lDebtToGDP.jpg
Brexit has shaken up the markets severely. "They" are doing their best to block implementation. It looks to be too little and too late. Great Britain needs great leadership and a GREAT plan NOW. The "elites" just don't seem to have any good leaders among them. They are focused on scamming the punters and don't know what to do when it all turns to feces.

https://www.theautomaticearth.com/2016/07/beautiful-brexit-and-the-five-stages-of-grief/

"Total government debt outstanding worldwide was worrisome in 2008. It has since doubled to $59 trillion, according to Economist Intelligence. What could go wrong?

But that is just one slice of the global debt pie. Add in household, corporate and bank debt and the grand total was a mind-boggling $199 trillion in mid-2014, up 40% since 2007, "
"Since the financial crash, "central bank policies have all been based on the theory that low interest rates will stimulate demand," said Edward Yardeni, head of economic and market research firm Yardeni Research Inc. "But that theory now has exhausted itself." No kidding,,, we're debt saturated and unemployed.

The credit bubble MUST keep growing. When individuals become debt saturated, the bankers look further up the chain. They gradually end up loaning to GOV. "In the U.S., the debt-to-gross-domestic-product percentage edged up to 233% in 2014 from 217% in 2007. In Spain the figure jumped to 313% from 241% and in Japan it rose to 400% from 336%. "
It is believed that 150% is the limit that can be serviced.
Another financial crisis? Soaring global debt since 2008 raises risk as world economy sputters - LA Times

Jim Willie is a "ray of sunshine".
"The degree of destruction has been so comprehensive and complete from desperate measures taken to preserve the system, as to make remedy impossible. The only working goal and objective for the ruling banker class is to prolong the inevitable death event, the collapse, the breakdown assured to cause a powerful sequence of events where the financial and economic system is seen as totally wrecked by even the naïve and ignorant unwashed masses. The ruling bankers realize no remedy is possible. They are just trying to steal as many assets and accumulate as much gold as possible before the main bust event."

http://www.silverdoctors.com/gold/gold-news/dead-pulse-the-morgue-is-the-next-stop-for-the-financial-system-jim-willie/

"The virtually unlimited level of credit creation by the major central banks over the past seven years has created conditions never seen before in the history of mankind." "The source these problems is a collapsing global debt pyramid. The huge ‘quantitative easing’ programs by central banks only slowed the collapse and actually made it much larger."

http://www.forbes.com/sites/investor/2016/07/07/the-folly-of-central-bankers/#e49ca353e95b

[Danny B]

Bad theory, bad plans,, bad results

The creators of the European Union knew that it would crash because no political union had ever survived if it didn't also have a fiscal union. They figured that they would just pick up the pieces and get a total union out of the ashes.
"The collapse in these same share-prices post-Brexit means that even the politicians now realise that the ECB acting alone cannot stabilize the European economy. Indeed, given the evident political strains in the European Union, saving the economy from recession is now key to saving the European political union project itself."
"If you don’t hear the rotors of der Hubschrauber (helicopter)very soon then what has begun is an economically painful but constitutionally necessary journey back to a common market and away from a political union."
The article claims that it is too close to call. Will Germany allow the helicopters to reflate Europe or will they refuse?
Russell Napier Reveals The "Only Question That Matters For Global Investors" | Zero Hedge

In Italy; "Efforts to rescue the 541-year-old lender have cost Italian taxpayers 4.1 billion euros ($5.6 billion)" "The Siena lender’s chairman at the time was Giuseppe Mussari, a political appointee with no prior bank-management experience who was in his first year on the job. "
Bank Born Out of Black Death Struggles to Survive - Bloomberg


"Total Federal tax collections came in at $300.6 billion in June compared to $327.5 billion last year " "Worse still, non-withheld taxes in June, which reflect bonuses and estimated payments for anticipated earnings, dropped from $76.7 billion last year to $62.3 billion this year. And that’s not just a rounding error; it’s a 19% plunge.

Likewise, corporate tax collections in June dropped from $74.9 billion last year to $62.8 billion this year. That’s a 16.2% drop.
Finally, even excise tax collections are down by nearly 3%. "
The FED had everybody's back so that nobody would ever lose in the markets. "But the economic gods created market-based price discovery for a reason. It was to insure that in the great arena of financial market supply and demand, the forces of fear and greed would contend on a level playing field. Short-sellers and contrarians heading south were to intercept the lemmings of greed heading north before they reached the edge of the cliff.

Now there is nothing but cliff. Central bankers have euthanized the short-sellers and empowered the lemmings of greed with free money to fund every manner of speculation while gifting them with cheap downside hedging insurance." "And the suddenness, unexpectedness, and violence of these episodic crashes slam the main street economy with gale force. "
"In short, by enabling the casino to fly blind monetary central planning functions as the enemy of capitalist prosperity."

http://davidstockmanscontracorner.com/wall-street-monkeyshines-look-ma-no-hands/

All this monetary Viagra is going to make for one hell of a climax.

Fiat currency is "money" that you must use by decree of GOV. ALL unbacked paper currencies eventually fail.
"The purpose of this article is to explain why monetary theory predicts a currency collapse."
"For monetary policy, this tells us two things: central banks are clueless about monetary theory, and in the event of a second systemic crisis, they will be misguided by their experiences of the last one."
They pumped in $ trillions to save the upper loop of the economy believing that this would save the lower loop.
"Neo-classical monetarists were initially worried by the potential for price deflation in the wake of the banking system’s rescue, and so central bankers expanded narrow money by unprecedented quantities to counter credit deflation, real and anticipated. "
A losing policy because responsible people were, either debt saturated or prudent. They could not find anybody responsible to lend to.

"Already, the Bank of England has announced that a further £250bn in monetary support will be made available to the banks, and that additional swap lines have been agreed between the major central banks. We can take this as evidence that the central banks, relying on empirical evidence, are preparing a new round of monetary expansion as the solution to any future crisis, confirmed in their belief that the risk to the credibility of their currencies is unlikely to be a problem."
OK, the CB is going to pump £250bn into the upper loop of the economy and believes that this will save the country. It hasn't worked yet,,, why stop?

"To prepare our minds for a comprehensive understanding of monetary theory, we must at the outset dispense with any idea that statistical analysis is relevant. It is not, because there are no constants involved. Valid statistics require at least one constant, usually the purchasing power of money. In the whole field of economics, let alone money, there are none. "
"Quack monetarists that believe in the equation of exchange, despite all evidence it does not work, overlook the subjective factors that qualify something as money."
"All these factors are the unknowable decision of every single economic actor, and fluctuate accordingly.

This self-evident truth continually risks undermining the very function of any particular form of money, "
"The fourth dimension is one of time. The injection of money into an economy will start at a point, typically the banks creating loans, or governments through unfunded spending. Money therefore enters an economy unevenly, benefitting some at the expense of others. This is known as the Cantillon effect, and is universally ignored by the neo-classical economic community.
The problem today

The reader should now have a grasp as to why attempts to discern future purchasing powers for money are futile, and why monetary policies of central banks never succeed, except perhaps by pure chance.

As if the four dimensions cited above were not enough, there is a further problem. Most fiat money is produced not by central banks, as is commonly supposed, but by commercial banks, which lend money into existence. Bank credit is essentially temporary money, and is regularly extinguished in credit cycles. It is the obvious potential for this bank credit to contract which concerns central bankers most. "

https://www.goldmoney.com/research/goldmoney-insights/the-prospects-for-money

[Danny B]

$500 trillion in derivatives trade based on bond yields

"the amount of credit that an economy can support is determined by the economy’s tangible assets, since every credit instrument is ultimately a claim on some tangible asset." The bankers escaped this age-old restriction and based credit instruments on other credit instruments. By creating imaginary gold, they escaped the restriction on interest rates that had historically been enforced by gold. They pumped up the credit bubble and the wealth effect at the same time.
" The abandonment of the gold standard made it possible for the welfare statists to use the banking system as a means to an unlimited expansion of credit."
— Alan Greenspan, 1961
" Greenspan was a strong proponent of gold and the gold standard. He wrote clearly and forcefully about how it was necessary to restrain the Deep State and protect individual freedom."
Alan "Bubbles" Greenspan Returns To Gold | Zero Hedge

"Globally over $500 trillion in derivatives trade based on bond yields."
"To top it off, over $10 trillion of this is sporting negative yields in nominal terms."
"This is why EVERY move the Central Banks have made post-2009 has been aimed at avoiding debt restructuring or defaults in the bond markets. "
"Again, the next crisis is here. The time to start preparing is now. The BREXIT was this crisis’ Bear Stearns. You don’t want to wait until the “Lehman” moment to prepare."
The $555 Trillion Derivatives Debt Implosion Is About to Begin | Zero Hedge
The DOJ doesn't see any problems with the bankers; Congress: “Too Big to Jail: Inside the Obama Justice Department’s Decision Not to Hold Wall Street Accountable” | Wolf Street

Stockman; "Bernanke was speaking of the 25% deflation of the general price level after 1929." "no one seems to remember that the deflation of the 1930’s was nothing more than the partial liquidation of the 100%-300% inflation of the general price level during the Great War."

"It’s also fiscal and monetary suicide. Japan’s debt is so massive and has risen so relentlessly even as its population and labor force has started to shrink that this latest round of fiscal stimulus can have only one outcome.

To wit, the government of Japan will ultimately be forced to repudiate its debts to the BOJ. When that happens a terminal monetary implosion will not be far behind."
Will the U.S. FED GOV repudiate it's debts to the FED?
Bernanke’s Black Helicopters | David Stockman's Contra Corner

Loan defaults are higher now than they were in the 2008 crisis; 2007 All Over Again... Banking Crisis Imminent | Zero Hedge

"There's roughly $13 trillion of global negative-yielding debt now, according to data from Bank of America Merrill Lynch, cited by the Wall Street Journal on Sunday. By comparison, there was about $11 trillion ahead of the UK's vote on EU referendum."
What a difference a couple of weeks can make. http://www.businessinsider.com/dutch...st-time-2016-7

"As Hartnett pointed out, a depositor in the U.S. will have to wait 107 years before doubling their money, while those in Japan will have to wait nearly 7,000 years. " http://www.marketwatch.com/story/cel...ica-2016-07-11

[aljhoa]

" The abandonment of the gold standard made it possible for the welfare statists to use the banking system as a means to an unlimited expansion of credit."
— Alan Greenspan, 1961
" Greenspan was a strong proponent of gold and the gold standard. He wrote clearly and forcefully about how it was necessary to restrain the Deep State and protect individual freedom."
Alan "Bubbles" Greenspan Returns To Gold | Zero Hedge

The Commercial Bulletin said:-

"The quickest, if not the only way to repeal the Silver Purchase lair is to precipitate a panic
upon the country, as nothing short of this will convince the silver men of their error, and arouse
public sentiment to a point which will compel the next Congress to repeal the Sherman law
whether it wants to or not."



While the money power of the United States, aided by the press and the unprecedented conduct
of President-elect Cleveland, was engaged in the scheme to totally cut off the further coinage of
silver, the New York banks were withdrawing tens of millions of gold from the Treasury and
shipping it abroad. At the time these banks were engaged in this transaction, they raised the rate
of interest on call loans to twenty-five per cent. While plundering the Government of its gold as
a part of the scheme to force an issue of bonds, they robbed the people by extorting illegal rates
of interest.



Every step taken by the money power to force a repeal of the Sherman law was cabled to
London with the avowed purpose of influencing England to close the Indian mints to the free
coinage of silver. Every step thus far taken by the money power of the United States and of
England to strike down silver was in pursuance of a well-defined plan to shackle the people to
an appreciating gold standard.
The Coming Battle - 1899


Al

[Danny B]

Re: silver,,, financing socialism

Silver has been very interesting down through history. The Chinese were on a silver-standard for quite some time. Germany was on a silver standard until the Comstock Lode was discovered in Nevada. Silver was much valued in India because it is anti-microbial and a store of wealth. When the Maharaja of Jaipur, went to London, he brought water from the Ganges to drink. This was on his trip in 1901. " There are two huge sterling silver vessels of 1.6 metres (5.2 ft) height and each with capacity of 4000 litres and weighing 340 kilograms (750 lb), on display here. "

U.S. GOV had 4 billion ounces of silver that JFK used to back the United States Notes that he printed. LBJ stopped the printing 11 days after JFK was killed. Then, U.S. GOV dumped the silver on the open market to make sure that nobody else got a bright idea.
While this silver was being dumped, the Hunt Bros. tried to corner the silver market. It makes for a VERY interesting story.
FOFOA: The Story of The Hunt Brothers

"The world’s first gold futures market opened in the Winnipeg Commodity Exchange in 1970. " This was the start of the "paper gold" markets. Reportedly, there are now 500 owners for every ounce of gold. Greenspan convincingly argued that the period of greatest prosperity in America was while we were on a gold standard. OBVIOUSLY, this period was NOT a period of prosperity for bankers.
The contract terms for SLV are very different for GLD. They make it much easier to screw the investors. Investment flows into PMs when interest rates go too low. Subtract inflation from interest and it makes sense to settle into gold until interest rates rise. Gold was rising too fast in the early 80s and Volker had to raise rates to low %20s to pry people out of gold.

The people of Yap island use huge stone rings for money because THAT is what they have agreed on as a yardstick. Gold was the accepted yardstick for quite a long time. We lost the silver in our coins after 1964. Paper-gold got it's start in 1970. Nixon closed the gold window in 1971. U.S. GOV made acceptance of fiat money the law of the land. Once that a debt instrument could be mandated to be a means of exchange and a store-of-wealth, new debt instruments could be created without limit.

In a general sense, unbacked fiat money was created and necessary to engineer socialism in America. If some portion of the populace was not productive, the actual producers would have to be harnessed up to provide for everybody.
"As Thomas Jefferson said, at that time,
“The democracy will cease to exist when you take away from those who are willing to work and give it to those who would not.”
"As Edward Gibbon stated in the late 18th century, on the death of the Athenian republic,

"In the end, more than freedom, they wanted security. They wanted a comfortable life, and they lost it all – security, comfort, and freedom. "
When Will They Learn? | Zero Hedge

The sovereign bond market is a harness on future producers. It just plain isn't going to happen. We have enormous future possibilities for growing productivity BUT, NO future possibilities for a growing wage base.
Smith says that we will need endless helicopter money to compensate for our dying wage base.
oftwominds-Charles Hugh Smith: Why Helicopter Money Won't Push Stocks Higher

[Danny B]

Fighting the revaluation of gold

Armstrong is a banker/investor. He, like the rest, hates the gold standard.
'You are creating a total collapse and revolution. How can all the unfunded liabilities be paid in gold?"

https://www.armstrongeconomics.com/markets-by-sector/precious-metals/gold/fictional-world-of-gold-standards/

AND;
Jul 12, 2016 Gold Revaluation Is The Only Solution Stewart Thomson 321gold ...inc ...s
ALL these speculators are booking :"gains" without ever producing any wealth. All the day-traders and manipulators and most of the investors. At one time, all debt instruments were connected to something tangible. ALL commerce was related to consumption / production. ALL this speculation just contributes to the debt bubble without creating any wealth. Get off the merry-go-round!
"Two weeks ago Rothschild lieutenant George Soros sold his US stock portfolio in favor of a short position on the US stock market"
"Deutsche Bank – the Nazi-funding Warburg family wealth repository which made a killing shorting the airline and insurance stocks negatively affected by 9/11 is reportedly sitting on $40 trillion in bad derivative bets"

https://hendersonlefthook.wordpress.com/2016/07/13/the-internet-psyop-the-coming-collapse/

Here is an article examining a work-free world. Would a Work-Free World Be So Bad? - The Atlantic

Soros is getting OUT but, don't worry; Greater fools storm the casino – David Stockman
The great market tide has now shifted to risk-off assets – Peak Prosperity Not for the muppets.
7/13 British pensions are now £383bn underwater – Telegraph
7/13 Stop being so gloomy about Brexit – Bloomberg Be happy!
The CBs are buying all the stocks. How does that work out in the end? The "Mystery" Of Who Is Pushing Stocks To All Time Highs Has Been Solved | Zero Hedge
7/13 The problem at euro banks – Credit Writedowns It's called "bankruptcy"

[Danny B]

The dying petrodollar taking down the dying financial system

Reportedly, the Italian banks are a bigger problem than Brexit,,,, for the moment. ALL the banks in Europe have intertwined exposure.
"Italian banking stocks have declined a whopping 68 percent since the beginning of 2016, and when you look at some of the biggest Italian banks the numbers become even more frightening."
Italy ATM’s Out Of Money- Who is Next? – Victurus Libertas
• Steve Keen Accused Of Causing Australia’s Coming Recession (Mish) Shoot the messenger.
• 35-Year-Old Bond Bull Is on Its Last Legs (WSJ) Those "legs" are also holding up a a few hundred $ trillion of bond derivatives.
• Spain’s Banks are Suddenly “Too Broke To Fine” (DQ) Italy will soon have lots of company.
• Great American Oil Bust Rages on; Defaults, Bankruptcies Soar (WS)

Lance Roberts; "“Wave 5, “market melt-ups” are the last bastion of hope for the “always bullish.” Unlike, the previous advances that were backed by improving earnings and economic growth, the final wave is pure emotion and speculation based on “hopes”
As Benjamin Graham, a wise man who would be scorned and ridiculed by today’s Ivy League educated Wall Street HFT scum, sagely noted many decades ago:

“In the short run, the market is a voting machine but in the long run, it is a weighing machine.”
ALL TIME HIGHS – The Burning Platform
7/14 Great American oil bust rages on – Wolf Street
Hmmm, about that oil bust; End of an Era: The Rise and Fall of the Petrodollar system - Gold And Liberty

" These problems are severe, says Ron Paul, who opines that “we’re witnessing” in American now “something similar to the breakup of the Soviet system” decades earlier. Paul says the Soviet Union system didn’t work then, just like the United States system doesn’t work now."
The Ron Paul Institute for Peace and Prosperity : Ron Paul: No Matter the Presidential Race Outcome, the US Is Going the Way of the USSR

[Danny B]

Emerging socialism,,, helicopters

Socialism endeavours to GIVE a higher standard of living to a person than what they actually earn. BUT, socialism is a distribution system rather than a productivity system. The wealth that it passes out, is a result of capital being combined with labor and commodities to produce food and consumer goods. Socialism relies on capital but, always mis-allocates it. Capital must re allocated to increasing productivity. If it is allocated to consumption, it soon dwindles away. Socialism eats up the principle and not just the profits.

A socialist State like America can defer the final day of financial reckoning by selling sovereign bonds. We/ they are spending today the rewards for the labor of future workers. American GOV today has $ 212 trillion of unfunded liabilities. Tomorrow's workers are going to have to pay a LOT of taxes. It really isn't a realistic plan because automation and outsourcing will knock the tax rolls WAY down.
GOV broke the linkage between credit instruments and tangible stuff so that they could do unlimited credit expansion. We have a rapidly growing credit bubble but, a shrinking wealth bubble.
FED GOV needed to dethrone gold to keep interest rates from rising. They needed low interest rates to keep the cost of the debt bubble manageable. They got their wish BUT, the debt bubble is way out of hand.

Armstrong, "How can all the unfunded liabilities be paid in gold?" They can't be paid anyway.

"The Great Society was a set of domestic programs in the United States launched by Democratic President Lyndon B. Johnson in 1964–65. The main goal was the elimination of poverty"
By 1966, the silver was gone from our coins By 1971, gold backing was gone. After that, came the petro-dollar. The petro dollar is now dying.
When the British obtained the first permission to drill for oil in Saudi Arabia, they paid 30,000 pieces of silver. Reportedly, the U.S. Nave must pay the Saudis in silver bullion for fuel now. STUNNER: Saudis Forcing US Navy to Use SILVER BULLION to Pay For Fuel! - Jim Willie | Silver Doctors
Just as the bankers create unlimited credit when given a chance, the socialists drive UN-goverened consumption when given the chance.
Repost; When Will They Learn? | Zero Hedge

The Venezuelan military has take over the 5 main ports to secure food distribution. The VZ GOV has ordered foreign companies NOT to pull out.
The reserve-currency status has allowed America to run up huge debts and finance home-grown socialism. A collapse of the bond market would unravel all of this. Pox Americana isn't in any hurry to see society and the economy totally collapse so, they have come up with one last desperate plan.
Helicopter Money——The Biggest Fed Power Grab Yet | David Stockman's Contra Corner
Who knows when?
"Soon" And "Really, Really Crazy": Starting Up The Helicopters - DollarCollapse.com

[Danny B]

The problems of globalism are becoming apparent

"The thrust of this propaganda is the notion that “populists” are behind the fight against globalization and these populists are going to foster the ruin of nations and the global economy." The Reasons Why The Globalists Are Destined To Lose
OK, nothing new there.
McKinsey Global Institute is now saying that globalism isn’t so great after all. This is a real shocker considering the source. "The Resentment Will Explode" - In Dramatic Twist, McKinsey Slams Globalization | Zero Hedge

Some good charts; 7 Economic And Monetary Charts That Make You Go Hmm - Mountain Vision
Some scary charts; US Banks Are Crashing | Zero Hedge
An examination of helicopter money; "Let us assume that the Bank of Japan one day mailed 1 million yen in new bank notes to every Japanese citizen. The person who finds 1 million in his mailbox will probably feel very happy"

http://www.bestmindsinc.com/documents/BMI_TheSoaringRiskofFlyinginBernankesHelicopter.July13.16.pdf

ALSO; "As of July 8th, we know from Lipper Fund Research that US stock based funds had seen 17 weeks of net outflows. This means the trend of net outflows by retail investors had taken place since March 11th.We know as of June 14th, research by BofA Merrill Lynch reveals that institutional clients were sellers for 20 of the last 21 weeks."
The CBs are buying up everything.

The inequality of the various States in the Eurozone has made a single currency impossible. There is talk of having a parallel currency to compensate. http://sputniknews.com/europe/201607...-currency.html

Manufacturing is the prime value-added industry. Global-wage-arbitrage and currency manipulation have allowed China to grab a very large part of manufacturing. This, and globalization in general is starting to look like a serious problem.
"As Ambrose Evans-Pritchard of the Telegraph has pointed out, however, Italy must choose between the euro and its own economic survival. Leaving the euro "may be the only way to avert a catastrophic deindustrialization of the country before it is too late."

http://www.zerohedge.com/news/2016-07-14/could-italy-bring-down-euro

It's already too late. The banking system will go down in flames very soon.

The huge push for globalization has squeezed out competitors. There is no backup system to fall back on in the case of a major crash in our centralized system. Things are moving too FAST for our retarded leaders to have any hope of compensating.

Then, there is gold; "COMEX gold peaked at $1,876 per ounce on Sept. 2, 2011. And recently traded as low as $1,056 per ounce on Nov. 27, 2015. That’s a 44% decline in just over four years. Yet in the same time period, broad-based commodities indices fell even more. One major commodities index fell 53%.

The contrast between the behavior of gold and commodities is even more extreme when we narrow the time period. From June 20, 2014 to Jan. 15, 2016, the broad-based commodity index fell 63%, while gold fell only 17%. The collapse in commodity prices was almost four times greater than the decline in gold prices"

http://dailyreckoning.com/golden-chameleon-changed-colors/

[Danny B]

The bond market signals a multi-trillion $ crash

When credit creation became divorced from tangible objects/backing, this allowed the bankers to create unlimited debt. This gave them the funds to buy up every politician and academic. Jim Rickards and Max Keiser have an excellent vid about how the banking cabal keep pumping up the system to keep the robbery going. https://www.rt.com/shows/keiser-repo...ax-keiser-940/
They are trying to keep the status quo going even as the working class is dying.
Brexit or not, the pound will crash | Bawerk.net

Housing bubble 2.0 has reached higher levels than the original bubble 1.0
Housing Bubble 2.0 - Are You Ready For This? | Zero Hedge

Unlimited credit/money/debt has allowed / nurtured unlimited mal-investment.
Stocks and bonds normally move in opposite directions. BUT, the central bankers are buying up both with wild abandon.
TheTelegraph: “Bond markets are signalling something very nasty coming down the road at us — an all-encompassing, worldwide deflation.”
"So… the good news is that the economy might not be nearly as bad as bonds are saying. The bad news is that bonds are a disaster in waiting.

Then there’s the worst-case scenario: What if bonds are right after all?

Below, David Stockman shows you why a multitrillion-dollar bond implosion is an “absolute certainty.” Read on."
Stockman; "It now appears that U.S. corporate bond issues will hit a record $1.7 trillion this year — or 55% more than the last blow-off in 2007. And that is due to one reason alone — bond managers are desperate for yield and are moving further out the risk spectrum exactly as our monetary central planners have ordained." Malinvestment
" How is it that the S&P 500 could be trading at an all-time high at 25X reported earnings at the very time that retail equity fund outflows have sharply intensified? During the last six months in fact, equity fund outflows have even exceeded levels experienced after the 2001–2002 dotcom bust."
" Corporate finances are being ransacked owing to the scramble for yield set in motion by central banks and the $13 trillion of subzero sovereign debt that has been generated in the last two years.

In short, the global bond market has become a giant volcano of uncollectible capital gains." "Can you say multi-trillion dollar bond implosion? Better try. Its eventual arrival is an absolute certainty."
Stocks and Bonds Are on a Collision Course - The Daily Reckoning

[Danny B]

Fulford, Sweden... shrinking Japan

Benjamin Fulford makes for a VERY interesting read. The crevices that he pries into are just too deep and obscure to find corroboration. He claims that there is an Eastern society that is at war with the Rockefellers, et al. It isn't at all difficult to imagine an Eastern assassination society that wants to kill Western criminal leaders. Here is a list.
BenjaminFulford?: Gold reward offered for the capture of Khazarian gangsters.
Once in a great while, Jim Willie seems to go "off the rails". He has mentioned Fulford and the White Dragon Society recently; Elites In Fear Of White Dragon Society & Gold Standard, Jim Willie - Welcome to The Vinny Eastwood Show
Just as Langley is responsible for extra-judicial killings, there is probably an Eastern group that is equally uncontrollable.
"“There is a Soviet Union style collapse undeniably taking place in the EU and a civil war brewing in the United States as Khazarian mafia control of the West’s political apparatus continues to fall apart. "

https://kauilapele.wordpress.com/2016/07/14/full-article-benjamin-fulford-7-11-16-khazarian-mafia-power-structure-crumbling-in-very-public-fashion/

Sweden posts deadlines for you to send ALL your Swedish banknotes in so they can give you digital credit. Something tells me that this isn't going to work out exactly as planned. The De-Cashing of Sweden Points to Much Bigger Problems | Observer

Western States, and the prime outlier, Japan, have a falling population. Western economies have been "financialized" and only the bankers are "earning" any money. We have been ripped off so badly that we can't afford to have children. The corporatocracy has put the squeeze on us BUT, the corporatocracy NEEDS a growing population to keep the credit bubble alive. They took our money so, we refuse to have kids.
How happy you are as a parent is directly tied to one very surprising thing | MNN - Mother Nature Network

We spent more on drugs than on food or gas or cars,,, $ 54.3 billion. http://wolfstreet.com/2016/07/15/big...ice-increases/

Japan lost market share and lost population. Abe thinks that all of this can be fixed with more money. " Japan has been sporadically ramping up stimulus for more than 25 years. Federal government debt to GDP was about 65% back when the Japanese Bubble burst in 1990. Massive fiscal stimulus saw debt to GDP surge to 140% by the end of the nineties. By 2009, ongoing aggressive deficit spending pushed the ratio through 200%. It's now almost reached 250%. Meanwhile, expanding $1.0 TN annually, the Bank of Japan’s (BOJ) balance sheet is rapidly approaching 100% of GDP. BOJ assets hovered between 30% and 40% of GDP in the ten-year period through 2012. "

http://creditbubblebulletin.blogspot.com/2016/07/weekly-commentary-scary-time.html

Bernanke has advocated "perpetual debt". Debt that is never paid back.

[Danny B]

History of debt cancellation

When the creation of credit was unchained from gold or anything else tangible, credit grew almost without limit. After the 2008 crash caused by too much debt, another $ 70-80 trillion was piled on. There was / is and extra $ 30 trillion just in America. The economy was/is shrinking so, this credit had no legitimate demand. By default, it flowed into mal-investment. All the various flavors of liar-loans and fraud.
In the eyes of the lenders, ALL debts must be paid, no matter how irresponsible the lender was in offering a loan to a deadbeat. Who should bear the burden of unpayable loans? Irresponsible lenders or irresponsible borrowers?
Michael Hudson writes about 5,000 years of historical data on debt cancellation when the borrower is not able to pay.
A Travesty of Financial History – which bank lobbyists will applaud - New Economic PerspectivesNew Economic Perspectives