Economic pressures

[aljhoa]

Paper gold is created just like paper dollars.
There are 300 owners for every ounce of gold.
Should the supply run out as it did in 1968, it would be catastrophic.

Executive Order 6102 required all persons to deliver on or before May 1, 1933,
all but a small amount of gold coin, gold bullion,
and gold certificates owned by them to the Federal Reserve,
in exchange for $20.67 (consumer price index, adjusted value of $378 today[4]) per troy ounce.
Under the Trading With the Enemy Act of 1917, as amended by the recently passed Emergency Banking Act of March 9, 1933,
violation of the order was punishable by fine up to $10,000 (equivalent to $182,802 today[4]) or up to ten years in prison, or both.
https://en.wikipedia.org/wiki/Executive_Order_6102

Al

[Danny B]

""A Monetary History of the United States, 1867-1960".

In that book, statistics are given which suggest that 13.9 million ounces of gold were still in circulation in January 1934 and that only about 21.9% of the gold in circulation had been handed in.""
In the case of the "trading with the enemy act", GOV moves directly from accusation to penalty. This is the act that is (was) applied for a person who travelled to Cuba. There is no hearing, arraignment, trial, conviction.

Copy of Prescott Bush 1942 Indictment Under Trading With the Enemy Act!
Copy of Prescott Bush 1942 Indictment Under Trading With the Enemy Act! - Democratic Underground

[Danny B]

Kunstler, Keen and Smith

Kustler; "The Deep State is also the sum of unintended consequences and diminishing returns of a late-stage, bureaucratic, techno-industrial economy cannibalizing itself to stay alive. "
Trumptopia - KUNSTLER
Steve Keen; "Using the dynamics of credit–which most other economists ignore–I explain why Japan, the USA and UK are among the “Walking Dead of Debt” and why China, Canada, Australia and South Korea are on their way to joining the Debt Zombies." - See more at: Zombies-To-Be and the Walking Dead of Debt ? Steve Keen's Debtwatch

Charles Huge Smith, " The promises made when there were 7 workers for every retiree cannot be kept when there are only 2 workers for every retiree."
oftwominds-Charles Hugh Smith: We Need a Complete System Overhaul: 5 Charts That Blow Up the Status Quo

The mega-banks sold their garbage all over the world knowing that it would blow up. Now, they need protection from all the people that they screwed; Obama: TTIP Necessary So As To Protect Megabanks From Prosecution | Zero Hedge

[Danny B]

The big Q.. What happens when you print money to remove risk?

There has been much talk about the notional value of derivatives. It is reckoned to be about $ 1.2----$1.4 Quadrillion.
5/11 Japan’s national debt climbs to ¥1,049.37 trillion – Japan Times a bit over a Quadrillion.

"To understand major investment collapses, we should distinguish causes from triggers. The central cause of a collapse is typically the extreme overvaluation that preceded it. Indeed, when equity valuations have been similarly extreme on historically reliable measures, as they were in 1901, 1907, 1929, 1937, 2000, and 2007 (as well as lesser instances such as 1973), the market has always followed by losing half of its value. Once reliable measures of valuation become obscenely elevated, steep losses are already inevitable; baked in the cake. What typically triggers the breakdown is the violation of some widely-observed “support” threshold (often roughly 14% below the market peak) that shifts trend-followers from feeding self-reinforcing speculation to feeding self-reinforcing liquidation."
Hussman Funds - Weekly Market Comment: Latent Risks and Critical Points - May 9, 2016
So, we have fear on one side and greed on the other. The FED backed all the investors and bought up all the junk that threatened to blow. The FED eliminated fear by back-stopping the markets. This allowed greed to take the helm. Valuations went to the moon because, there was no way that you could lose. Valuations went way up BUT, earnings did not.
When earnings went flat, investors got nervous that the party was over. 50% of U.S. corporate bonds are junk rated,,,, how could their stocks be a good investment?
Some MAJOR funds have deserted the markets. When Druckenmiller and CITI and B of A say that it is going to blow, less-informed investors will take note.
5/11 B of A: ‘Vortex of negative headlines’ to hit stocks – Bloomberg

Nobody wants to be left holding the bag. So, while nominal valuations may be quite high, you can't find anybody to buy your paper.
That is where volatility comes in to play. You can only sell on the upswings. Why should you hold a stock with no earnings issued by a corp. that is junk rated?
So, the FED backstopped the market but, it can't do anything about earnings or credit ratings. Bernanke said that he could prop things up with monetary policy but, only for a while. The recovery from the 2008 crash peaked in 2013. Bernanke insisted that GOV had to implement fiscal policy to do the rest of the work. With 1/2 the country on welfare (corporate or private), GOV is loathe to pull out the rug.
The trade deficit is $ 45 billion a month. How much longer can GOV print it's (our) way out of poverty?

What about other governments?
5/10 The world’s most extreme speculative mania unravels in China – Bloomberg
5/11 Chinese company has debt equal to whole of Australia – Financial Review
5/11 China’s government says it’s over debt-fuelled growth – Fortune
OK, without debt-fuelled growth, what growth will it have? China pumped in $ 1 trillion in the first quarter. It made almost no change. New debt is the only thing keeping MANY businesses open. Can China "afford" to have 350? million unemployed?

[Danny B]

Central banks are shooting blanks

The CBs did what they could but, they have reached the end of the line.
,,,,,"would know that the bond fund manager has advocated for central banks to do everything in their power to save the global economy, including lowering rates.

With no sign of a fiscal response, "sadly it was the only option", he says in his latest report to clients. "Central banks are important institutions that used to fulfil the role of defending the financial system from collapse. If they are now shooting blanks, who's left to perform the role?"
'Miracle' needed to save the world, because central banks can't, says BTIM's Vimal Gor

"History has shifted, and we're leaving the era of central bank convergence and entering the era of central bank divergence, i.e. open conflict." oftwominds-Charles Hugh Smith: The Coming War of Central Banks
"From our vantage point, we already see carnage in the financial markets, with the worst opening week in US history. This of course lines up neatly with standard Austrian business cycle theory, which says that the central bank can give an appearance of prosperity for a while with cheap credit, but that this only sets the economy up for a crash once rates begin rising.

However, there is something new in the present cycle. The Fed is trying to raise rates while simultaneously maintaining its bloated balance sheet. It is attempting to pull off a magic trick whereby it can keep all of the “benefits” of its earlier rounds of monetary expansion (i.e., “quantitative easing” or “QE”) while removing the artificial stimulus of ultra-low interest rates. As we’ll see, this attempt will not end well, for the Fed officials or for the rest of us. "
http://www.24hgold.com/english/news-...P.+Murphy&mk=1

"A report released by PricewaterhouseCoopers (PWC) on Monday estimates that commercial applications for drones will replace $127 billion in services and labor annually "in the very near future,"

Read more: New Job-Killer Drones Look to Put Over 4.23 Million Americans Out of Work

[Danny B]

Goldman reams the muppets. The disadvantages of labor

The cheerleaders; "admitting Goldman was wrong yet again with one more trading recommendation (recall that Goldman had earlier been stopped out and lost money on 5 of its Top 6 trades for 2016 in just over a month). "
Goldman Closes "Short Gold" Recommendation With 4.5% Loss; Will Continue Buying Gold From Its Clients | Zero Hedge
Gold man always bets against their clients; "In other words, Goldman admits it was wrong, but still remains indirectly short as it is still hoping to skewer even more muppets on the very same trade it has gotten wrong for the past 3 months... and in the process buy their gold if possible."

FOFOA; "In the first Debtors and Savers back in 2010, I agreed with Karl Marx's statement that "the history of society is the history of class struggle," but I disagreed with his delineation of the classes as the workers versus the capitalists, the rich versus the poor, or the haves versus the have-nots. My delineation was "the easy money camp" or "the redistributors," which I dubbed the Debtors for short, versus "the hard money camp" or "the live within their means and take personal responsibility for their own future camp," which I dubbed the Savers for short.

Marx and I merely have two different perspectives on history. But Marx's perspective is wrong yet almost universally held, dangerous because it often leads to bloodshed, and politically expedient to the Left because it rousts envy in the have-nots. Meanwhile, my perspective, being the correct yet little known one, actually reveals how Freegold is the elegant solution to one of the oldest conflicts in the world"

Eloquent, but WRONG.Labor is always at a disadvantage to capital. Capital expands it self with no effort or limit. Labor can't expand without effort. Capital can leave the market with little downside. Labor can only leave the market if it wiling to go hungry. Capital gives little colored pieces of paper to the worker for labor. Capital gives these SAME pieces of paper to itself without labor.
Labor's share of GDP has gone down for the last 46 years. Automation makes it that much worse. The birth rate is dropping which should cause a shortage of labor. Automation more than makes up the difference.
FED GOV is trying to fulfil overly generous promises that it made in the good times. It has $ 212 trillion in unfunded liabilities. Sanders would like to see the debt bumped up; Bernie Sanders budget would add $21 trillion to debt: analysis This isn't going to end well.

[Ruphus]

Grandma's foreclosure

FYI the wife's grandmother was deemed incompetent over a year ago. The wife is the power of attorney so she elected to put all of grandma's GOV pension towards a old folks home. She stopped paying on the reverse mortgage her grandma put on the house last February. The loan is for more than the home is worth. She called BOA and told them the situation and that it would be a bankrupt estate. BOA sold the loan to some shell company. Its been 14 months and they haven't foreclosed yet due to backlogs I'm sure.

[Danny B]

No country for old people

The Amish do not pay into social security. They convinced GOV ages ago that they always take care of their own. There are going to be many millions of old folks who are going to die because they don't have family who can/will support them.

[Danny B]

Troubled times

The department of defence has been transferring HUGE amounts of military hardware to police and every other GOV agency. The Militarization Of America's Police: Despite Obama Promises, War-Weapon Spending Soared In 2014/15 | Zero Hedge
"They" are VERY well armed. It's possible that this is done as a contingency and no shots will ever be fired
A federal agent has written a very long note before he killed himself. https://www.superstation95.com/index.php/world/1288
"When the inevitable collapse begins to take place, electric power to the entire country will be shut off, as will all forms of communication. All banks will be immediately closed; no one will be able to get any money because all ATM's will be offline. Credit, Debit and EBT cards will not function. Anyone without cash will have no way to get any. The Emergency Alert System will be used to takeover all broadcast stations and tell the public this is a result of a cyber attack.

But while the American people patiently await things to get back to normal, the government will unleash round-ups of citizens they deem militants or dangerous. "
Knowing that our central GOV is just a cabal of criminals, this scenario isn't completely unlikely.
How did this happen? Why didn't our lawmakers stop this from blossoming?
"saying that his main job is to raise money for re-election and that leaves little time for reading the bills he votes on."
"'Fundraising is so time-consuming I seldom read any bills I vote on,' the anonymous legislator admits. 'I don't even know how they'll be implemented or what they'll cost.'

"My staff gives me a last-minute briefing before I go to the floor and tells me whether to vote yea or nay. How bad is that?"

Read more: Anonymous congressman writes tell-all book and admits he never reads bills he votes on | Daily Mail Online

#2 The inventory to sales ratio is now back to near where it was during the depths of the last recession.
#5 In April, commercial bankruptcies were up 32 percent on a year over year basis, and Chapter 11 filings were up 67 percent on a year over year basis.
#8 According to Challenger, Gray & Christmas, U.S. firms announced 35 percent more job cuts during April than they did in March. This indicates that our employment problems are accelerating.

#9 So far this year, job cut announcements are running 24 percent above the exact same period in 2015.
“Global earnings are now 14% off the peak set in August 2014 and back to where they stood five years ago. Equity prices on the other hand are 25% higher. Gravity beckons!” 11 Signs That The U.S. Economy Is Rapidly Deteriorating Even As The Stock Market Soars

[Danny B]

Emerging revolutions

"Lawmakers in the European Parliament have sharply condemned the latest Greek bailout deal - reached after weeks of negotiations - which they say will lead to "Social Armageddon"

Read more: Latest Greek Bailout Deal Slammed by MEPs as 'Social Armageddon'
The banks who lent money to Greece got the GOV to take the bad loans off their hands. GOV went after Greece with a vengeance. GOV now recognizes that it is pushing revolution. 95% of the bailout money to Greece went to the banks and not to the Greeks. These are really stupid people. If they put the Greeks to the wall, the Greeks will do as they always have; 'Default Would be a Great Solution': Dutch Libertarians Advise Athens

VZ & Brazil Will Fall w/o Military Intervention - Morris
The military has resorted to stealing food (goats) to feed themselves. How can they deploy?
"Congress Wants You To Be Able To Sell Your Organs" It's been done before; https://www.youtube.com/watch?v=aclS1pGHp8o

Revolution is on the wind. Death rides on it's coat tails.

[aljhoa]

Federal Reserve Act : Public Law 63-43, 63d Congress, H.R. 7837:
An Act to Provide for the Establishment of Federal Reserve Banks,
to Furnish an Elastic Currency, to Afford Means of Rediscounting Commercial Paper,
to Establish a More Effective Supervision of Banking in the United States,
and for Other Purposes

on page 30,
SEC. 30. The right to amend, alter, or repeal this Act is hereby expressly reserved.



Al

[Danny B]

Denying Say's Law.... looking for consumers

America had it's best years when it did NOT have an elastic currency. Those who do not work for what they get despise a"fixed" currency. The MEPs in the EU parliament "earn" $ 2300 a day to sit and listen to trite, BS speeches.
GOV is redistribution and GOV workers are at the head of the line for generous handouts. The welfare State guarantees that the People are pacified and go along. The warfare State allows them to fulfil their never-ending quest for more power.
We are conditioned all our lives to obey ALL authority and approve war. How the School System Gave America Perpetual Warfare
Anti-war protesters are dealt with VERY harshly.

Welfare-warfare costs a LOT of money. When the money runs out, the whole façade crumbles.

Socialism is always too generous. The Greek pension system was / is just too generous. Socialism may provide benevolence for a while but, you can't have 2 workers supporting 7 non-workers. The math catches up eventually.
Power corrupts and attracts corrupt people to GOV. Socialism seems to attract people who are both corrupt and incompetent.

Venezuela is in tears. "the International Monetary Fund now projects that prices will rise by 720 percent this year and 2,200 percent in 2017."
Venezuela Is Falling Apart - The Atlantic
5/13 Raw Venezuela: Looter burned alive, streets filled with hunters – Zero Hedge

Capitalism is the only productivity scheme. Socialism for the poor and fascism for the rich are consumption systems. Creeping fascism & and creeping socialism have now given capitalism a bad name. 'We do not have capitalism" Ron Paul. We have crony-capitalism that is just a variation of fascism. BUT, the PTB are pushing us towards accepting socialism by giving capitalism a bad name. They do handouts to keep as many people dependent as possible. These same people will welcome the next phase where they surrender every bit of privacy and liberty. GOV recently complained about people who frequently change their passwords.

Those who champion redistribution must necessarily deny / ignore/ violate Say's law.
"The modern incarnation of this myth started with JM Keynes, who by the mid-thirties believed he had enough cause to overturn Say’s law, or the law of the markets. So the roots of today’s crisis go deep, and originate long before Volcker’s interest rate hike in 1981.

Say’s law states that we produce to consume. Therefore, production is bound tightly to consumption, including deferred consumption, otherwise known as savings. And if someone consumes without producing, someone else has to produce the wherewithal"
https://www.goldmoney.com/the-endgame?gmrefcode=dollarc

Automation has brought us to a stage where production is practically unlimited. Automation has brought us to a stage where there are ever-fewer workers needed and consumptive ability is shrinking. Various States are searching around to find a way to accommodate this new paradigm.
5/13 Defying debt fears, China bets on infrastructure, property – Reuters They have more infrastructure than they know what to do with. They have close to 80 million empty buildings. It is slowly becoming apparent that the consumer has the final say in the growth and level of productivity.

• America’s Middle Class Meltdown (FT)
• ‘Fed Doesn’t Get It About Global Excess Supply’ (MW)
• Budweiser’s ‘America’ No Longer Exists (MW)
5/13 Duncan: China slamming into a brick wall – Financial Sense
5/12 1 in 3 American malls are doomed – CNBC
5/13 “We are on the cusp of a 30 year bear market” – Zero Hedge Actually, Armstrong projects it to last for 26 years.

[aljhoa]

.
Capitalism is the only productivity scheme. Socialism for the poor and fascism for the rich are consumption systems. Creeping fascism & and creeping socialism have now given capitalism a bad name. 'We do not have capitalism" Ron Paul. We have crony-capitalism that is just a variation of fascism. BUT, the PTB are pushing us towards accepting socialism by giving capitalism a bad name. They do handouts to keep as many people dependent as possible. These same people will welcome the next phase where they surrender every bit of privacy and liberty. GOV recently complained about people who frequently change their passwords.

American Indian Russell Means

Al

[Danny B]

Protecting GOV pensions and stealing all other pensions

Russell Means is certainly eloquent.
Everybody promises TOO much. ZIRP has killed interest income and the pension funds have to cut back; 400,000 People Just Had Their Pensions Cut By 50%: "Going to Happen To The Rest Of Pensions in the United States"
"Six months later, the U.S. Supreme Court took things a step further when they opined that the government has the right to fully seize 401(k) and pension funds that were being poorly managed."
So, if your fund loses money, GOV will grab everything. ALL funds will be losing money.

AH, but GOV pensions are sacrosanct. https://www.armstrongeconomics.com/i...own-the-drain/
"The New Jersey State Assembly has begun the pursuit of a constitutional amendment to guarantee pension payments for government workers over all other types of state spending. This would naturally include all politicians, which is why they are introducing it"
The State of New Jersey spends $ 1,102,347 to maintain one mile of two lane state highway for one year.
The State of Arkansas spends $ 37,000 to maintain one mile of 2 lane state highway for one year. That is a LOT of retired GOV workers who need a LOT of money.
GOV everywhere is trying to scrape up the money to fulfil previous promises. They didn't make out too well on the carbon tax so,,, tax water; https://www.armstrongeconomics.com/w...oseph-stiglitz

"The use of money in a market economy is a praxeologically necessary fact. That gold — and not something else — is used as money is merely a historical fact and as such cannot be conceived by catallactics."
"The gold standard alone makes the determination of money’s purchasing power independent of the ambitions and machinations of governments, of dictators, of political parties, and of pressure groups. "
https://mises.org/blog/ludwig-von-mi...-9-quotes-gold

The TTP and the TTIP and the TiSA are all attempts for the corporatocracy to get complete control over GOV and make fascism total and complete. Meanwhile, socialism is trying to dig in and get control.
The Collapse of the European Union: Return to National Sovereignty and to Happy Europeans? | Global Research - Centre for Research on Globalization

The bought-and-paid-for economists told the government that laissez-faire economics was the best system. Let competition rule the market. BUT, the big boys paid for legal changes that convert everything to a monopoly. There was no more competition because crony-capitalism ran the show.
https://www.theguardian.com/business...oseph-stiglitz

The European Monetaty Union could collapse in the blink of an eye; https://www.armstrongeconomics.com/a...they-collapse/

Great article on unintended consequences; http://www.peakprosperity.com/blog/9...de_title_98224
The economic bust is bad news for a lot of people; http://www.theautomaticearth.com/201...tress-suicide/

5/14 ‘Death Awaits’: Africa faces worst drought in half a century – Spiegel Lagos, Nigeria has about 23 million people and Nigeria has lost tons of money on the falling price of oil.
5/15 U.S. concern grows over possible Venezuela meltdown, officials say – CNBC The meltdown has already happened. Next is the revolution.

[Danny B]

Deserting the markets,,,, then what?

Doug Casey is a perma-bear and pushes gold. That doesn't mean that he is wrong just because of his slanted attitude. He has a list of observations; "Making The Chicken Run" To Escape The Looming Greater Depression
Tyler Durden makes a LOT of good points about the economy;
"The Global Negative Feedback Loop" - Why Investors Are Fleeing Capital Markets | Zero Hedge
It's very true that many investors are fleeing the markets. Casey speculates about investors fleeing sovereign bond markets. How important is this if the Central banks are buying each other's debt? How long will they do this? How long before they concentrate on sovereign survival?

China; "China’s Debt Bomb [Chart] No One Knows if its a Hand Grenade or a Nuclear Explosion"
Chart: China's Debt Bomb

5/16 Total US debt is back to its Great Depression peak – Talk Markets
5/16 “One big worldwide bubble” – Mish
5/16 Jeff Gundlach: I see the S&P 500 going to 1,600 – ETF Daily News
5/15 Retailers suffer week from hell – New York Post
5/16 Forget the Saudis, Nigeria’s the big oil worry – Bloomberg Nigeria will blow fast. They import most of their food. As long as oil stays low, they will find it increasingly difficult to finance imports.

5/16 Watch Venezuela, because its plight is coming to America – Economic Collapse Venezuela made too many promises and can't pay for them.
The Central banks were acting in unison. BUT, the Chinese leaders live in China and worry about Chinese revolution. American leaders live in America and worry about American revolution. ALL the markets are crashing. A currency war is about State and CB competition. It has started; The Silver Age of the Central Banker - Salient

Henry Ford wrote about one group if financiers that owe no allegiance to any country and don't care who or what they destroy. The International Jew The World's Foremost Problem

The wonks who dreamed up / created the European Union were told in no uncertain terms that no currency union had ever survived if it didn't also have shared debt. They said that they couldn't make it fly that way and would just force the debt union AFTER the inevitable crash. They seem oblivious to the fallout / blowback from said crash. This type of crash is quite common and very often, quite quick.
https://www.armstrongeconomics.com/a...they-collapse/