Economic pressures

[Danny B]

The end of Western gold.

I've posted lots of info about gold. There is extensive documentation that the price is manipulated. There is extensive proof that the gold moved from West to East. Now, the mainstream news has reported that the gold is GONE.
Bloomberg: London Gold Vaults Are Virtually Empty, All the Gold Has Been Transferred to Hong Kong! | SilverDoctors.com
OK, the gold moved for a reason. What is that reason?
More importantly, what happens when there is no more gold in the West?
Hundreds of tons a week are leaving. It is a very recent phenomenon.
My Blog

The gold stocks are at a new low point;
Weekly COMEX Gold Inventories: Gold Available For Delivery Hits New All-Time Low - World News Report

When the gold stops,,, what else stops?

[Danny B]

various predictions

Here is the news from Pastor Williams;
"it will mean the US dollar will be reset down by 30% of its current value. He says that bank holidays are still another year off and that 30-50% of private, state and federal retirement funds are to be nationalized and/or confiscated between now and then."
Lindsey Williams ~ The Global Currency Reset by The Elite in 2014 | THE FINANCIAL ARMAGEDDON BLOG
He's talking about this taking place Q2 2014

Gerald Celente of Trends Research says that it will crash by march 2014;
GERALD CELENTE 2014 Forecast ~ The Whole Thing Will Collapse by The 2nd Quarter of 2014 | THE FINANCIAL ARMAGEDDON BLOG

Jim Willie says that we will get a 50% devaluation of the dollar;
http://www.24hgold.com/english/news-...Willie+CB&mk=1
Jim also says that America will continue with our current dollar and it will be backed by gold and used for international trade. We will also have a domestic dollar that will not be backed by gold.

Adrian Salbuchi said much the same about 2 currencies.
This 30---50% devaluation will cause a commensurate rise in prices for many things. As prices go up,,, which is actually wages going down, people will restrict their spending to just essentials. The reduction in discretionary spending will erase much of the consumer economy. Imports will be much higher since balance of trade deficits will need to be settled in gold.

42% of house sales are now done by cash buyers. They plan to rent them. With spending power cut in half, that doesn't look like a good bet.
BUT, don't worry. U.S. GOV is backing the loans on a very high % of residential RE. They will have the final say on whether you get kicked out or not. It all depends on whether you have been naughty or nice to your uncle.
I hope that you haven't said anything negative about those worthless imbeciles in the district of corruption.

If you need any help on suggestions for stocking stuffers for Christmas, I have one. Buy those solar panels before the (effective) price doubles. Energy use is down in America. Energy producers have had their bonds downrated to bbb. That is bad. Their cost for credit will go up. Their business is going down and their revenues are falling. They need a serious price increase.
Clean Energy Presents "Perfect Storm" For Utilities | Zero Hedge
Keep in mind that a dollar devaluation will raise the cost of imported oil and uranium. It won't affect natural gas as much. Same for coal. Every rise in the price of energy reduces the money available to be spent in other sectors of the economy.
There is a 500% increase of Chinese purchases of American real estate so, evidently, they expect to see a U.S. default.

[Danny B]

Over saving and under consumption

Over the last several centuries, there has been a decrease in barter and an increase in the use of barter substitutes. There has been an ongoing attempt to understand currency and other instruments. There are lots of different schools that all claim to have a good understanding of these various instruments. MMT,,, modern monetary theory has a lot of ideas, both good and bad.
Many decades ago, there were many notable people arguing their ideas. Keynes is well known. Hobson was another interesting person. His ideas may be relevant to the problems in Japan today.

"Hobson was one of those rare social reformers who used economic theory as a foundation for his proposals. He rejected the classical and neoclassical ideas that pure competition is the typical market situation and that a harmony of interests prevails, and that led to a program of reform, largely through government intervention, which broadly interpreted may be considered welfare economics. THEORY OF UNDERCONSUMPTION

In the 1880s Hobson developed the idea that underconsumption and oversaving lead to overinvestment—a concept that later won him Keynes’s acclaim. The central problem of our society, proclaimed Hobson, is the recurring unemployment of labor,
capital, and land. As early as 1889, he and Mummery argued against the classical HOBSON doctrine that the more thrifty a nation is, the more wealthy it becomes. On the contrary, they said, an increase of capital requires a subsequent increase in the consumption of the commodities that will be produced by that capital. If people wish to save more now, they must be willing to consume more in the near future.

If they persist in saving now and attempt to invest their savings without adequately increasing their consumption in the near future, the actual formation of new capital will be limited: Our purpose is to show . . . that an undue exercise of the habit of saving is possible, and that such undue exercise impoverishes the Community, throws labourers out of work, drives down wages, and spreads that gloom and prostration through the commercial world which is known as Depression in Trade; that, in short, the effective love of money is the root of all economic evil. . ."

" We are thus brought to the conclusion that the basis on which all economic teaching since Adam Smith has stood, viz., that the quantity annually produced is determined by the aggregates of Natural Agents, Capital, and Labour available, is erroneous, and that on the contrary, the quantity produced, while it can never exceed the limits imposed by these aggregates, may be, and actually is, reduced far below this maximum
by the check that undue saving as the consequent accumulation of over-supply exerts on production; i.e., that in the normal state of modern industrial Communities, consumption limits production not production consumption. . . .Reaching our main conclusion, that the undue saving of individuals impoverishes the Community, simultaneously lowers Rent, Profit, or Interest and Wages, we contradict the generally accepted dogmas that the saving of the individual seeking his own
advantage necessarily works for that of the Community, and that wages can only rise at the expense of profit, or profit at the expense of wages, or both at the expense of rent."
------------------------------------------------------------------------------------------

Michael Hudson writes,
"Economies change their shape as they grow. This shape is distorted by the inherent tendency for financial claims – bonds, bank loans and other financial securities – to grow more rapidly than the economy’s ability to carry them, much less to pay them off. The volume of such claims tends to grow by purely mathematical principles of self-expansion, independently from underlying economic trends in wealth and income, and hence from the ability of debtors to pay.

The task of economic regulation is reduced to setting an appropriate interest rate to keep all the economy’s moving parts in equilibrium. This interest rate is supposed to be controlled by the money supply. An array of measures is selected from the overall credit supply (or what is the same thing, debt securities) to represent “money.” This measure then is correlated with changes in goods and service prices, but not with prices for capital assets – bonds, stocks and real estate. Indeed, no adequate statistics presently exist to trace the value of land and other real estate.

The resulting economic models foster an illusion that economies can carry any given volume of debt without having to change their structure, e.g., their pattern of wealth ownership. Self-equilibrating shifts in incomes and prices are assumed to enable a debt overhead of any given size to be paid. This approach reduces the debt problem to one of the degree to which taxes must be raised to carry the national debt, and to which businesses and consumers must cut back their investment and consumption to service their own debts and to pay these taxes."

can carry any given volume of debt
Well, we can see how that is working out.

Assuming that Hobson is "correct" what does that imply about savings? More specifically saving by the rich? The six heirs to Walmart are said to have as much wealth as the bottom 40% of the population. Their money is locked in savings and investments and does not circulate in the economy. The bankers extended credit farther and farther to consumers to make up for a lack of wages/consumption power. We have reached the point where the debt-service cost makes it impossible to extend any more credit.

What about all that money that is locked away? Doesn't it throw the economy out of equilibrium?

---------------------------------------------------------------------------------------

From Hudson again,
"Rising productivity would raise wages and living standards, enabling people to work shorter hours under more relaxed and less pressured workplace conditions."
"Why hasn’t this occurred in recent years? In light of the enormous productivity gains since the end of World War II – and especially since 1980 – why isn’t everyone rich and enjoying the leisure economy that was promised?"

"It reflects something that only a very few economists have worried about over the past century: the prospect of debts rising faster than income, leading to financial crashes that transfer property from debtors to creditors"
"Nearly all observers expected the fruits of technology to trickle down, not be siphoned up to the top, to the banking sector whose “financial engineering” played no directly technological role in the production process. Textbook models describe – or rather, assume – that rising productivity will be passed on to labor in the form of lower prices (reflecting falling costs of production, enabling wages to buy more) or, if prices are “sticky,” higher wages."
Productivity, The Miracle of Compound Interest, and Poverty | New Economic Perspectives

-----------------------------------------------------------------------------------------

Hobson;

"According to Hobson, labor typically gets its subsistence costs, but does not
receive the full costs of growth. In other words, higher wages generally increase the efficiency and productivity of labor. There is too much saving and not enough consumption because of the failures of competition among businessmen to work effectively toward raising wages and lowering property incomes. Because capitalists’ incomes are too high, they save too much. They are motivated not only by the desire to consume now or in the future but by the urge to save and invest—to accumulate wealth—as well. This accumulation of wealth is possible only if the demand for consumer goods increases. "
-----------------------------------------------------------------------------------------

"A 2012 report from the Tax Justice Network estimated that between USD $21 trillion and $32 trillion is sheltered from taxes in unreported tax havens worldwide."
Tax havens: The missing $20 trillion | The Economist

The capitalists want to lower wages to increase profit margins. They lowered our wages at the same time that we increased productivity. They stashed their increased profits out of both taxing and circulation. They are only very slowly beginning to appreciate the fact that all that debt money that they have accumulated is a CALL on future productivity. That future productivity is dependent of future CONSUMPTION.
There is no profit or taxing if there is no production/consumption. No wages,,, no consumption. As the parasitic taxes are raised, consumption falls. If GOV prints currency, wages are effectively depressed.
You get the idea; inadequate wages, no tax or profit.

GOV is printing currency to give the banks a substitute for the profits that have faded away. This particular fascist business model doesn't have any future. The Socialist business model is equally destructive. The fascist model concentrates only on productivity. The Socialist model concentrates only on distribution ( consumption).
At this moment, these 2 models are tearing us apart in trying to gain control.

[Danny B]

CBOE's SKEW index

Here is a cute little graph;
http://www.infiniteunknown.net/wp-co...SKEW-Index.jpg
"CBOE's SKEW index does just that,
based on the pricing differences between normal and fat-tail risk pricing in the options market, it provides a
measure of the market's belief in extreme events... and for only the 4th time in history, it's flashing a big red warning signal of volatility ahead."
http://gordontlong.com/reports/rpt-M...Supplement.pdf
Another graph that suggests that mid-january will bring extreme volatility;
http://www.hussmanfunds.com/wmc/wmc131125j.png
The big problem with volatility is that nobody can predict if they will make a profit or not. They stay out of the market. This further lowers the velocity of money and brings more deflation.

[Danny B]

Default is in the winds

Corporate profits are at an all-time high.
Forbes reports that the S&P 500 companies are at an all-time low at funding their in-house pensions. American corporations are sitting on $ 1.45 trillion in cash with $ 840 billion held overseas.
U.S. Companies Stashing More Cash Abroad As Stockpiles Hit Record $1.45T - Forbes
Why won't they fund their own pensions?

Another strange deal;
,,,,," Verizon Communications Inc. to Apple Inc. borrow unprecedented amounts of money to expand and reward shareholders."
"December 24 – Wall Street Journal (Steven Russolillo): “U.S. companies are showering cash on shareholders, powering the stock market’s record-breaking rally. Share buybacks and dividends are reaching levels unseen since before the financial crisis, as persistent economic uncertainty prompts cash-rich companies to reward shareholders rather than invest in other activities"
The Prudent Bear: 2013 in Review
Companies are borrowing tons of money to pass out to shareholders because/even though earnings are low or gone.
Is the party almost over?

The Dow index seems to be down for the end of the year;
The dow is down 12 percent! Fri, Dec 27, 2013, 10:50AM EST | PoliticalJack.com
U.S. GOV sold off OUR silver years ago and has now sold off OUR gold.
Many smart and influential people have warned that GOV will seize the pension funds. Government Will Seize All Pension Funds Globally – In the US that will Include 401Ks | Armstrong Economics

It's happening in Europe and Russia said that it will seize the funds temporarily.
European nations begin seizing private pensions - CSMonitor.com

So, the smart money won't put anything aside for pensions,,,, where it is sure to be stolen. They shift everything to bonuses and dividends. It will be harder to steal from numerous small accounts that one giant fund.
GOV is going to declare Force majeure and cancel contracts and obligations. There are 10 quadrillion worth of contracts denominated in dollars worldwide.
If GOV has no gold or silver, the international courts can't demand repayment in precious metals. The B.I.S. settles ONLY in gold. They (we) sold it all to pay ongoing expenses. Not only did we sell OUR reserves, we sold the reserves of other countries.

Germany believes that it owns 3931 tons of gold. They demanded repatriation and we sent them 37 tons in a one year period. Much of Their gold is stored deep underneath the Federal Reserve Bank of New York.
This bank is directly across the street from the giant J.P. Morgan vault and,

" Chase Plaza (now the Property of JPM) is linked to the facility(FED) via tunnel... I have seen it. The elevators on the Chase side are incredible. They could lift a tank."
Why Is JPMorgan's Gold Vault, The Largest In The World, Located Next To The New York Fed's? | Zero Hedge
A Look Inside the Secret Tunnel Connecting JPM's Gold Vault to NY Fed | SilverDoctors.com

The party is winding down and somebody has to pay the bill. Our dollar is backed by the "full faith and credit" of the U.S. GOV. That has a "ring" to it, like ,,, hope and change.
We maxed out our credit card. Default comes next.

[Danny B]

This is the market capitalization for the U.S. stock market for the last 4 years, not including 2013;
15,077,285,740,000 17,138,978,000,000 15,640,707,100,000 18,668,333,210,000 (2012)
U.S. shares are up roughly 30% in 2013 so the final numbers for this year should be quite high. Earnings are down so, where is all the money coming from to cause the rise in price.

"The U.S. Treasury needed to pay off a record of approximately $7,546,726,000,000 in maturing Treasury securities in fiscal 2013,
"During the same period, the Treasury turned around and issued another $8,323,949,000,000 in new Treasury securities. "
"The Treasury’s medium- and short-term low-interest notes and bills accounted for about $9,278,245,000,000—or 80 percent—of the government’s $11,577,400,000,000 debt held by the public."

U.S. GOV has to roll over more than $ 7 trillion a year. This is a problem because our total debt is over 100% of GDP. The FED claims to be buying only $30---$40 billion of GOV debt a month. This is, of course, a lie. The FED is buying over 90% of newly issued U.S. debt. All the debt has moved into short-term paper and it takes a LOT to roll it over. If the FED is buying almost all new paper, what is happening to U.S. debt on maturity?

Jim Willie;
"The next year will feature many powerful new effects. The Indirect Exchange will become a prominent fixture, its channel filled. It will direct many $billions in USTreasury Bonds from large scale asset acquisitions by Eastern and BRICS players, sent back to New York and London. The payments for the asset purchases will be done in USTBonds, as the Eastern entities dump them as fast as they can before the great devaluation."

U.S. treasury paper is issued by primary dealers who sell it for GOV. Jim claims that all this paper that isn't being rolled over into new treasury debt will be presented to the primary dealers to buy stocks. This would account for stocks seeing so much inflow. The U.S. can default on U.S. bonds and notes but, it can't very well default against stocks.

The market cap grew $3 trillion 2011 to 2012. It is estimated that it grew 30% from the 2012 cap of $18,668 trillion. China had $3.4 trillion in it's sovereign wealth fund. They could have easily converted this to stocks without mentioning it. U.S. GOV wouldn't mention it because everybody would freak out. China is buying all the world's gold mine output. China is brokering much of the word's oil. Why not buy all the world's performing stocks?
2014 will be the year of the currency reset and gold backed trade note - National Finance Examiner | Examiner.com

On thursday, September 6, China announced that it would sell oil in yuan. The petro-dollar is coming to an end. Besides that, China said "on that day, our banking system is ready, all of our communication systems are ready, all of the transfer systems are ready,"
The West has a banking system called SWIFT. Several other nations got together and built an alternative system. The U.S. is excluded. Not only is the petro dollar dead, the Western banking system will bleed to death.
World trade will be conducted in Yuan. At the end of every month? ALL accounts of debit-credit will be settled in gold.

Currently, accounts are settled in new/more debt notes. Since no account is ever extinguished, the debt grows without limit. THAT is where the world finds itself at the moment. ALL Western banks will be instantly insolvent AND illiquid.
The rest of the world has an over-capacity in industry. They don't really need to import from us. If they demand gold for payment, there isn't much we can do. China will have an external Yuan that is gold convertible. The new banking system will be referenced to this yuan. SWIFT will go the way of the Betamax.

[Danny B]

monopolies, energy and the stauts quo

Happy new year to all.
Lord Acton said that power corrupts. You can't argue with that. As power concentrates from the level of dog-catcher on up to president, the level of corruption rises. Everybody wants an advantage over his fellow man. One of the best ways to gain advantage is to have a monopoly. GOV holds the monopoly on "legal" violence so, GOV is the best avenue for obtaining a legal monopoly. Mao said that all GOV authority comes from the barrel of a gun. You will need violence to maintain your monopoly whether it is a legal monopoly or an illegal monopoly.

If you want advantage, you must petition GOV for a monopoly. Since GOV is corrupt by definition, they are always willing to SELL you advantage that you don't merit. Since the average would-be monopolist can't very well walk around the halls of power with bags full of money, he must find a specialist.

The average congressman spends 30--70% of his time raising money to be re-elected,,,, so that he can continue to spend 30--70% of his time raising money. The specialist is the lobbyist. He passes money from the monopolist to the legislator. This cozy gravy train is perpetuated by the fact that about 50% of former legislators later become,,,, lobbyists.

Lawrence Lessig has a good talk about this.
Lawrence Lessig: We the People, and the Republic we must reclaim | Video on TED.com
Since the ultra-rich can be ultra generous to politicians, they can buy legislation to perpetuate their advantage.
Monopolies are perpetuated by legislative perpetuation of the status quo. Everyone from Tesla to Stanley Meyers created technology that would have disrupted the status quo of the energy structure that was the foundation of the power structure.

Since carbon energy is the foundation of the wealth structure, it is the foundation of the power structure that is used to maintain control.
History of British Petroleum: Part I | LEFT HOOK by Dean Henderson
History of British Petroleum: Part II | LEFT HOOK by Dean Henderson

For small segments of society, the wealth is secondary and the control is primary. For lack of a more inspired name, I refer to these people as the "top puppeteers" TP for short.
The TP are obsessed with control. Obviously, a person obsessed with control must obsess equally with centralization. The Agenda 21 handbook that is sold and distributed by the united nations lays out much of the plan for centralization.
Agenda 21: Earth Summit: The United Nations Programme of Action from Rio: United Nations: 9781482672770: Amazon.com: Books

Big Government is the foundation of corruption. Small communities are the antithesis. Energy is the master resource. Manufacturing is the primary value-added industry. Society advances from price deflation. Price deflation brings a higher standard of living. Cities are the most energy efficient living arrangement because of extremely low transportation costs. Goods and people move very short distances.
Hmmmm, I need to break this up.

[Danny B]

Competition, price deflation and small communities

Mankind is ALWAYS competing. Therefore, he is always pursuing efficiency. The TP want to preserve the status quo. Mankind is pursuing efficiency. Increased efficiency is CHANGE. America used to be very competitive.
China;
China's innovators are making leaps and bounds. By 2015, they will graduate 17,000 postdoctoral fellows in science, math and engineering. That's a 60% increase from 2010.

They're building supercomputers that rival IBM's and 3-D printers big enough to print air wings. The Chinese also granted 217,000 patents last year — a 26% increase in the past two years alone."

Competition and efficiency are still marching along. This threatens the status quo. The PTB and the TP are trying to play whack-a-mole as new tech shifts the ground under their feet.
There are plans extant for building a 2150 sq. ft. house with a 3D printer.
DARPA has a device that will condense 30 gallons a day of pure water out of the air IN a desert enviornment,,,, with NO power input. A ZPE energy device would extend energy independence that is already available from solar power,,, and wind.
The energy efficiency enjoyed by the city is slowly being eroded away by tech advances. Transportation advantages enjoyed by cities will be reduced by 3D printing. Warehousing and transport will diminish.

With adequate price deflation, small communities will be more competitive and attractive. ZPE would make small farms competitive again if they were attached to local communities... negligible transportation costs.

The PTB work diligently to concentrate us in cities. The coming crash will prove cities to be non-viable... for the most part. Adequate tech advances will allow small communities to flourish. Hope for the best.

[Danny B]

Generational cycles and the rise of collectivism

Civilization and society seem to run in cycles. Elliot-Wave,,, Kondratieff.... Strauss–Howe generational theory. Part of the reason for this is the predator-prey relationship between the producers and the parasites. The producers create wealth and the parasites gradually increase their own standard of living until the producers can no longer maintain them or society.

The main focal point of this battle is PRIVATE property. The parasites call for communal ownership. The producers believe that private property rights must remain inviolate. History has shown that the producers stop producing when they lose the right to the proceeds of their own work.

The founding fathers knew this and spelled out property rights to insure the general prosperity. The parasites never liked this idea because it limited their personal prosperity. The collectivists have always been willing to crash general prosperity if it (temporarily) augmented their personal prosperity.
this process takes some time to develop so, history runs in cycles.

Blackstone describes the absolute rights of individuals as being our right to life, liberty and property. Jefferson took the editorial liberty of changing "property" to "pursuit of happiness,"
Fiedor: State of the Union, 1998

Since GOV is a non-producer, it is also the fountainhead of collectivism and parasitism. It should come as no surprise that GOV is in the business of stealing.
Humanity has rights. But they are not recognized by any govt. in practice, only by lip service. Humanity has to protect its rights from rulers, i.e., professional parasites who are empowered by their victims. The private sector parasites, criminals without sanction, are no problem compared to government. It follows, the victims are their own worst enemy because they create the biggest threat to themselves by giving up their power to a ruling elite. Usurpation of rights is what all governments do. It is the primary objective of rulers to rule. Ruling requires power, and rights restrict power. Weak governments make for strong society. The more powerful the govt. grows the weaker the society gets. Govt. will always seek greater power until it self destructs, taking its citizens down with it.

The only hope for humanity is to repudiate being protected by rulers. Self governance and self responsibility is the salvation of civilization. But that requires humankind to grow up and stop trusting a "big brother" to control life.
So, here we are in the fourth turning. Like the strangler fig, GOV has grown to the point where it is killing the host. The police state is an attempt to control the host. The police state can NOT force the host to be productive.

[Danny B]

collctivism and personal responsibility

Man's nature is genetic selfishness. He looks after his family first. Collectivism demands that he looks after everybody. Collectivism has always failed. The non-producers want an ever-higher standard of living. It all goes bust because nobody wants to work for free. The parasites have no interest in taking personal responsibility. Personal responsibility is at the heart of a functioning society. If everyone is irresponsible, everything falls apart. A parasite has no regard for his host so, by definition, it is irresponsible. What happens when the parasites run the show?

Illinois vs Oklahoma
"A State with No Republicans!"

Some interesting data on the 'state' of Illinois ... There are more people on welfare in Illinois than there are people working. Chicago pays the highest wages to teachers than anywhere else in the U.S. Averaging $110,000/year. Their pensions average 80-90% of their income.

Body count: In the last six months,
292 killed (murdered) in Chicago . 221 killed in Iraq ; AND Chicago has one of the strictest gun laws in the entire US.
Here's the Chicago chain of command: President: Barack Hussein Obama · Senator: Dick Durbin · House Representative: Jesse Jackson Jr. · Governor: Pat Quinn · House leader: Mike Madigan · Atty. Gen.: Lisa Madigan (daughter of Mike) · Mayor: Rohm Emanuel · The leadership in Illinois - all Democrats. · Thank you for the combat zone in Chicago . · Of course, they're all blaming each other. · Can't blame Republicans; there aren't any! · Chicago school system rated one of the worst in the country. Can't blame Republicans; there aren't any!

State pension fund $78 Billion in debt, worst in country. Can't blame Republicans; there aren't any!

Cook County ( Chicago ) sales tax 10.25% highest in country. Can't blame Republicans; there aren't any!

This is the political culture that Obama comes from in Illinois . And he is going to 'fix' Washington politics for us?

George Ryan is no longer Governor, he is in prison. He was replaced by Rob Blagoyavic who is, that's right, also in prison.
And Representative Jesse Jackson Jr. Resigned a couple of weeks ago, because he is fighting to not be sent to... that's right, prison.
The Land of Lincoln , where our governors make our license plates. What?
As long as they keep providing entitlements to the population of Chicago , nothing is going to change, except the state will go broke before the country does.
"Anybody who thinks he can be happy and prosperous by letting the Government take care of him better take a closer look at the American Indian."

PART 2— Oklahoma


OKLAHOMA - may soon have plenty of new residents!

THIS IS REALLY INTERESTING, AND TRUE ... PLEASE READ IT!

Oklahoma is the only state that Obama did not win even one county in the last election... While everyone is focusing on Arizona ’s new law, look what Oklahoma has been doing!!!


An update from Oklahoma
Oklahoma law passed, 37 to 9 an amendment to place the Ten Commandments on the front entrance to the state capitol. The feds in D.C., along with the ACLU,said it would be a mistake. Hey this is a conservative state, based on Christian values... HB 1330

Guess what... Oklahoma did it anyway.

Oklahoma recently passed a law in the state to incarcerate all illegal immigrants, and ship them back to where they came from unless they want to get a green card and become an American citizen. They all scattered. HB 1804. This was against the advice of the Federal Government, and the ACLU, they said it would be a mistake.
Guess what... Oklahoma did it anyway.

Recently we passed a law to include DNA samples from any and all illegal's to the Oklahoma database, for criminal investigative purposes. Pelosi said it was unconstitutional SB 1102 Guess what... Oklahoma did it anyway.

Several weeks ago, we passed a law, declaring Oklahoma as a Sovereign state, not under the Federal Government directives. Joining Texas , Montana and Utah as the only states to do so. More states are likely to follow: Louisiana, Alabama, Georgia, Carolina's, Kentucky, Missouri, Arkansas, West Virginia, Mississippi and Florida. Save your confederate money, it appears the South is about to rise up once again. HJR 1003

The federal Government has made bold steps to take away our guns. Oklahoma , a week ago, passed a law confirming people in this state have the right to bear arms and transport them in their vehicles. I'm sure that was a setback for the criminals The Liberals didn't like it -- But.... Guess what... Oklahoma did it anyway.

Just this month, the state has voted and passed a law that ALL drivers’ license exams will be printed in English, and only English, and no other language. They have been called racist for doing this, but the fact is that ALL of the road signs are in English only. If you want to drive in Oklahoma , you must read and write English. Really simple.

By the way, the Liberals don't like any of this either Guess what... who cares... Oklahoma is doing it anyway.
------------------------------------------------------------------------------------------
Socialism and collectivism are distribution systems. Since nobody takes responsibility for PRODUCTION, it dies out. The focus has to be on productivity first,,,before consumption.
https://www.facebook.com/photo.php?v=221534748011905

[Danny B]

Kunstler, Ilargi and Hedges

James Kunstler is a peak oil guy who has written a few books. He probably is correct when he predicts peak American oil, EXCLUDING ALASKA. He has a good article showing that diminishing returns on shale oil are wasting a LOT of capital.
Jim Kunstler's 2014 Forecast - Burning Down The House | Zero Hedge
There is plenty of oil in Central Asia, Coober Pedy, the oil kitchen, Kuwait, Iran, south China sea, etc. America can't afford to buy this oil. We are too deeply in debt.
In preparation for our impending impoverishment, the State is preparing to clamp down on all of our freedoms;
The Last Gasp of American Democracy | Common Dreams

Ilargi has written very good advice at The Automatic Earth. This article is part 2 of advice on surviving the coming credit collapse;
Smart Choices for the Coming Bust - Part 2 - The Automatic Earth

Money itself has been so distorted that a collapse of credit will bring a collapse of consumption. We saw just a hint of that in 2008. A collapse of consumption eventually brings a collapse of production. Already, we see big drops in the Manufacturing index
Kunstler projects a world where everything is made by hand because automated manufacturing is no longer viable. I doubt it.

[Danny B]

Jim Willie,,, inflation

I found a page of good charts. One chart shows the " competition between deflation and inflation. Keep in mind that inflation is defined as an increase in the supply of currency AND credit.

" monetary inflation and deflation is currently working against each other:

Monetary inflation is the result of a parabolically rising monetary base M0 driven by the central bank monetary easing policy.
Monetary deflation is the result of shrinking monetary aggregates M2 and M3 because of credit deleveraging."
Inflation vs Deflation – Monetary Tectonics In 25 Amazing Charts | Gold Silver Worlds

When AIG went belly-up, it wasn't too difficult for GOV to get a Hundred billion $ electronically printed up. The current crop of Interest rate swaps are a different story. They are nominally valued at $ 441 trillion. They blow if/when interest rates return to normal.
Jim Willie; "But to print a few $100 trillion for aiding the big banks would be impossible. So enter the QE to Infinity initiative to come to the aid of the Too Big To Fail banks. Their failure cannot be prevented. "
Deceptions, Dupes & Dots
GOV can send liquidity to the banks but, if interest rates rise, the derivatives will still default.

Venezuela has high price inflation. The ordered merchants to sell basic foods at low prices. It sounded like a good idea BUT, all their food is being exported to places with higher prices. These are BASIC foods.
GOV says, "Colombian General Gustavo Moreno, director of the border police.
“consumerism is an addiction that destroys the human being.” Apparently, these people are addicted to eating every day.
Hunt for Food Sends Venezuelans to Colombian Border Towns - Bloomberg

OK, let's look at this closer. Venezuela has huge amounts of oil in the Orinoco basin.
Norway has huge amounts of oil in the North Sea. All Norwegians are millionaires due to their oil.
All Norwegians become crown millionaires, in oil saving landmark | Reuters

The birth rate per 1,000 people is 21.5 in Venezuela. The birth rate per 1,000 people in Norway is 10.8 Due to the compounding effect of a doubled birth rate, Venezuela can not grow the economy fast enough. The population is always growing faster. The economy can't provide the wealth to support all those new mouths. GOV prints to support them. Price inflation is at 56%. Sad situation.

[Danny B]

Deflation and scarcity of paper money

There is a lot of speculation on whether we will see inflation or deflation. I found a great article to clarify the question. Some excerpts;
"What is logically implied in this “debate” is that spiraling inflation or crushing deflation are alternative scenarios; when, in fact, it has been patently obvious for many years that these two forms of economic cataclysm not only can be but, must be concurrent (if not simultaneous) scenarios."

"It is Mr. Williams who first made the quantum leap in analysis in noting as our debt-saturated economies crumbled towards collapse – and fiat money-printing increased exponentially as a result – that “inflation” and “deflation” were not competing scenarios. He coined the term “hyperinflationary depression”

"As the debts go higher and higher (which can only end in a deflationary crash); we see the money-printing accelerating at least as quickly, if not faster (which can only end in hyperinflation)."

"Where confusion about this hyperinflationary depression ahead of us seems to envelope other commentators – and simultaneous or concurrent inflation and deflation – is that it is possible for some asset-valuations to go straight up (to infinity) while others go straight down to zero (or less).

Specifically, this dichotomy will take place between paper instruments and hard assets. Any/every entity which is encumbered by the millstone of debt will plunge to zero. With somewhere in excess of $200 trillion in debt already floating around the global economy; the downward “suck” as all these debt-dominoes implode will reach an economic velocity never before witnessed in our history."

When Deflation Becomes Hyperinflation: SPDR Gold Trust (ETF), iShares Silver Trust (ETF) | ETF DAILY NEWS
All debt instruments can be duplicated with almost no limit. They will lose value. Tangible products are not infinitely duplicable and will hold value. A pound of coffee will always trade for the same amount of toilet paper. This is part of the law of supply-and-demand. Keep in mind that the law of S&D also applies to paper money. Only .04% of the U.S. money supply is in the form of paper.
Zimbabwe printed $trillion notes. Wiemar Germany printed trainloads of paper money. America hasn't done this. I expect paper notes to be very hard to obtain in a credit crash.

[Danny B]

German gold

The story keeps getting stranger.
"Back in the mid-1920s, the head of the German Central Bank, Herr Hjalmar Schacht, went to New York to see Germany’s gold. However the NY Fed officials were unable to find the palette of Germany’s gold bullion. The Chairman of the Federal Reserve, Benjamin Strong was mortified, but to put him at ease Herr Schacht turned to him and said ‘Never mind, I believe you when you when you say the gold is there."

Fast-forward to 2 years ago;
"This FSB report further states that upon Strauss-Kahn raising his concerns with American government officials close to President Obama he was ‘contacted’ by ‘rogue elements’ within the Central Intelligence Agency (CIA) who provided him ‘firm evidence’ that all of the gold reported to be held by the US ‘was gone’.

Upon Strauss-Kahn receiving the CIA evidence, this report continues, he made immediate arrangements to leave the US for Paris, but when contacted by agents working for France’s General Directorate for External Security (DGSE) that American authorities were seeking his capture he fled to New York City’s JFK airport following these agents directive not to take his cell-phone because US police could track his exact location.

Once Strauss-Kahn was safely boarded on an Air France flight to Paris, however, this FSB report says he made a ‘fatal mistake’ by calling the hotel from a phone on the plane and asking them to forwarded the cell-phone he had been told to leave behind to his French residence, after which US agents were able to track and apprehend him."
Russia Says IMF Chief Jailed For Discovering All US Gold Is Gone | EUTimes.net Charles DeGaulle

The drama continues;
Bundesbank; "There is no reason why the original gold bars acquired in the 1950s and 1960s (if they ever existed at all, which has never been proven, as by publication of bar lists or photos) had to be melted down and recast into LGD-compliant bars in New York as opposed to Frankfurt."

The FED melted down these bars and recast them before delivery
"And especially: Why was it deemed necessary to perform this action in the United States as opposed to Frankfurt or nearby Hanau, where there are some of the best facilities in the world for metal probing, melting, and recasting? Had these actions been performed in Germany in a fully transparent manner, it would have been so easy for the Bundesbank to dismiss all questions from "paranoid gold conspiracy theorists."

Obviously, the FED didn't want any tungsten to show up in the melt
"the Bundesbank has again failed to produce any proof or indication that at least 37 tonnes (out of 1,500 tonnes of German gold at the New York Fed"
1500 tons of wishful thinking.
"It is still possible and even probable that the old German bars were lent into the market long ago or that they have multiple owners or are backing multiple gold exchange-traded fund derivatives. Of course the same holds for our remaining 120,000 bars at the New York Fed."
Yeah right,,, 120,000 bars that have NEVER had bar numbers.
Did the Bundesbank get even a little of its original gold back? | Gold Anti-Trust Action Committee

They also said that they are going to move 374 tons from Paris to Frankfurt. It's only 500 kilometers. They can make the trip in one day with a dozen trucks. Where is the German Gold? | SilverDoctors.com
Nothing out of Paris yet.

Germany asked to see their gold held in custody in New York. The FED said NO-WAY. Finally; "The German government then asked to visit the FED vaults to inventory the gold and determine its actual existence, but the FED refused to permit Germany to examine its own gold. The reasons given were “security” and “no room for visitors”. And nothing else.

Germany did finally send some staff to the FED, and they were permitted only into the vault’s anteroom where they were shown 5 or 6 gold bars as representative of their holdings, and were permitted nothing else."
In the 60s, Charles DeGaulle sent a navy ship to New York to pick up France's gold. Others followed and gold was flowing out at 100 tons a day. Nixon shut the window Aug 15, 1971.
Germany is screwed and they know it. The excuses from the FED are so pathetic, nobody legitimate would utter them.

[Danny B]

Too many bankers,, not enough income

Banking is both lucrative and competitive. The business gets crowded until things go bust. 9400 banks went out of business after the 1929 crash. Post WW II was very productive and the number of banks grew proportionately. Then, America crashed into a low-wage competitor and our main value-added industries shut down and moved. This reduced the need for banks.

"According to the Federal Deposit Insurance Corp., the number of federally insured financial institutions fell to to 6,891 as of the end of September. That’s the lowest it has been since 1934, when federal regulators began tracking the number. In the past 30 years, more than 10,000 banks have closed because of mergers, consolidations or failures."
Number of U.S. banks drops to record low - CBS News

OK, pretty much logical. Also, the big banks have been continually rescued over the years.
The Largest U.S. Banks Have Repeatedly Gone Bankrupt Due to Wild Speculation. The Fed Blessed the Speculation then Helped Cover Up the Bankruptcies → Washingtons Blog
The business got too crowded and there was no money to be made. Recently, the banks "invented" derivatives to generate fees so they could survive when traditional sources of income were inadequate. These derivatives don't actually do anything productive so, they don't have a long-term future.
Several years ago, the bankers got the laws changed for Savings & Loan institutions. It cost the taxpayer a cool $ trillion to bail them out after the looting . There just doesn't seem to be enough wealth created to keep such a big number of bankers happy. Later, the bankers got the Graham-Leachy bill passed to remove the restrictions imposed by the Glass-Stegal act.

Once again, the bankers are trying to save themselves by throwing their debts on the backs of the public. America was in VERY good financial shape before we entered the great depression(1). At the moment, America is in very BAD shape as we enter great depression II. This is because the banker-initiated wars have bled the country dry in the runup to our falling off the current fiscal cliff. This will make the situation much worse.



Vice President Coolidge on the Obligations of Banking Institutions

There can be no permanent prosperity of any class or part. Such a condition can only be secured through a general and public prosperity. This means that to secure this end there must be a general distribution of the rewards of industry. Wherever this condition is maintained there you have the foundation for an increasing production and a sound financial and economic situation.

One of the strongest reasons for supporting American institutions is that under them this condition is more nearly attained than under any other form of government that has ever met with any permanent success.

You are assembled here representing banking institutions. Too often the uninformed think of a bank as the possession of a few rich people, and as the creditor of the people at large. You who have had any experience with banking know that it is the opposite of this which is true. The resources of banks are not the resources of a few rich, but the resources of the people themselves, small perhaps in any individual instance, but, in the aggregate, very large. Nor are banks exclusively a creditor class. It is usually true that they owe to their depositors more than their borrowers owe to them. Every banker knows that to depend on the business and patronage of the rich would be in vain, that if any success attends his efforts it must be by serving and doing the business of the people. The stock is generally owned by the people, the deposits are always made by the people. This is the reason that banks partake of the nature of a public institution and perform real public service. They are the sole means by which modern commercial activities can be carried on. They afford the method by which the people combine their individual resources, providing a collection of capital sufficient to extend the necessary credit for financing the whole people of the nation. They hold great power and are under the very gravest responsibilities. A bank is not a private institution, responsible to itself alone, or to a few. It is a public institution, under a moral obligation to be administered for the public welfare. In so far as this standard is accepted and followed, it is my belief that a bank will be prosperous; in so far as it is disregarded, it will be a failure. Any power which is not used for the general welfare will in the end destroy itself.

There is need of a more sympathetic attitude and cooperation between the banks and the people. Every such institution ought to realize the necessity of serving the public to the extent of its ability. A financial institution which takes advantage of no man's necessity, which assumes no unreasonable risks for the sake of unreasonable gains, which is able to know the personality of its customers as well as the value of its collateral, becomes an instrument of great value, and a contributor to a marked degree of economic contentment. Such an institution is doing the work of the people.

This condition has not yet been universally established, but it is being established. Nothing can tend more to promote it than to have the man in the shop realize that transportation and financial activities are being carried on for his benefit; that the railroad brings raw material so that he may earn a livelihood by making them into finished products; that the bank exists in order to furnish credit from which he receives a weekly wage, while those products are being sent far away and sold to the people. While the man in the bank needs to realize that his success lies in the freight-yard, in the manufacturing plant, on the farm, and in the mine as well as at the discount window. If all this were to be translated into one word, I should say it was the need of vision, need of a recognition of our interdependence, need of less destructive criticism and more constructive action, need of that spirit which has given character, fame, and fortune to New England, whether it has guided the plough or inspired the pulpit.

Calvin Coolidge, The Price of Freedom, Charles Scribner's Sons, NY, 1924.

- See more at: The Banks and the People | Calvin Coolidge Memorial Foundation | Plymouth, Vermont