Economic pressures

[Danny B]

Debt-Based Money Corrodes Society | Zero Hedge

America had 5 times the retail space per person that France had. We had LOTS of money (credit) and we were going to SPEND it. Plastic included. It is now expected that 25% of the malls will be closing in the next 5 years. The State gooses the upper loop of the economy but, this does little for the lower loop. Consumption accounts for about 70% of the GDP. Consumption is falling and taking out commerce with it.
Record "Wealth" In America? 72% Of US Businesses Are Not Profitable | Zero Hedge

"As UBS' analyst Arend Kapteyn wrote then, the "global credit impulse (covering 77% of global GDP) has suddenly collapsed"
" As a result: whereas back in Jan '16 the global credit impulse was positive to the tune of 3.8% of global GDP (of which China comprised 3.5% of global GDP) it has now fallen back to -0.1% of global GDP (China's contribution is -0.3% of global GDP)."
UBS Has Some Very Bad News For The Global Economy | Zero Hedge
SO, credit growth is DEAD in the water. How are we going to roll-over the existing debt if there is no new credit?
" in the US the correlation between activity and the impulse is very strong, and the lack of credit growth could constrain an acceleration in GDP from weak Q1 levels (the credit impulse suggests domestic demand growth should be close to 1% rather than the 2+% which consensus is currently tracking). "
Keep in mind that the U.S. GOV spends 24% of the GDP. Any cutbacks in GOV spending translate to negative GDP.Is the Central Bank?s Rigged Stock Market Ready to Crash on Schedule? | Zero Hedge

Congress will take an August recess. That will leave little time to work out a debt ceiling.
"The Sooner We Do It, The Better": Congress Should Raise Debt Ceiling Before August Recess, Mnuchin Says | Zero Hedge

Illinois has until July 1 to cough up $billions of payments. Chances are, they will be downgraded and their bond market will crash.

http://www.zerohedge.com/news/2017-06-12/illinois-bond-spreads-explode-market-pukes-latest-batch-bad-news

[aljhoa]

You're asking a question that has a long answer. The owners and controllers of the FED are/have been almost entirely jewish.

Herzyl's dream has turned into a nightmare. Israel is just a garrison surrounded with very high walls.

The terror gangs went house to house killing mostly women and children because the men were NOT present. This action and many others like it set the pattern for subsequent genocide.

The jews are starting to catch on that judaism has been hijacked by zionism,

The current claim is that Ashkenazi jews are responsible for all the excesses of warring and power-mongering. I haven't read deeply into this.

The jews have been kicked out of MANY places. What about the Amish, the Menonites, The Jains, the Buddhists? Hopefully, the jews will throw off the yoke of zionism and be forego the dream of world conquest.
I've gone way off-topic but, it is background for our economic situation.

There is a BIGGER, WIDER PICTURE here...and the POWERS THAT CONTROL SUCH AGENDA ARE INTERNATIONAL, GLOBAL.

It is all about a few families WORLDWIDE which control MAJORITY OF THE WEALTH GLOBALLY.

These Families do not operate under any "PARTY NAME" of either Left nor Right, nor Blue nor Red.

They only follow MONEY AND POWER.

Yes a few families control much money and THEIR right and left
arms are the RIGHT and LEFT political system, THEY all do what
THEY are told.

The world has been operating in commerce for 6000 years. Judges, bankers, and lawyers are in the Bible. They have mastered and passed on their secrets for 6000 years (2). Knowledge of how your brain works have been hidden for centuries. These people accomplished control over your thoughts before you were five years old by "legal" drugs (3), the media [television (4) (5) / music (6)] Controlled by a few corporations (7). Then by schooling (8). You have been programmed not to think (9). This was done incrementally over time so you did not notice (10).


What are TPTB?


Al

[Danny B]

Who Are the 'Greater Fools" Now? - munKNEE dot.com

[Danny B]

Ingrained myopia

Martin Armstrong is a real smart guy. He constantly harps on the idea that you must be completely dispassionate about investing. Somehow, he is completely missing an important facet.
Armstrong; "Well Mr. Gates, I needed 240 employees in the 1980s and 1990s to maintain databases and collect everything around the world. I can do that at the push of a button today. So perhaps we should tax the entire internet and the computers you make along with your software because I can do myself with an assistant what it took 240 people to do 30 years ago."
AND;
"First of all, robots are killing jobs because taxes and demand for benefits are going crazy. Healthcare costs are consuming the net disposable income and government taxes, and the combination is conspiring to lower annual economic growth rates dramatically."
He admits that he has eliminated 239 jobs. He fails to see that those 239 people need State help to survive. He acts like there is an unlimited pool of employment available.

The corporatists are hard at work to do trade agreements and lower wages across the board. They piss and moan about GOV taxes. The French GOV spends 57% of the GDP. Italy,, 50%. What do they think would happen if this support was withdrawn?
The upper loop is all in agreement that non-working people will go back to work if State support is withdrawn.
Armstrong is part of the group that is solely focused on finance and productivity. They seem to believe that consumption will take care of itself.
Armstrong blames the State for extracting too much tax from the finance sector. The State is the entity that pumped in the money in the first place. He sees the finance sector as being distanced from the consumer.

[Danny B]

Financialization... labor vs automation

If the FED raises rates today, this will be somewhat of an indicator of whether or not they intend to crash the economy. Reportedly the FED believes;
"Since then, the unemployment rate has fallen to a 16-year low of 4.3% and economic growth appears to have reaccelerated"
Federal Reserve'''s Interest Rate Announcement Wednesday | Fortune.com

https://en-us.janushenderson.com/advisor/make-money/

Why is it that he can't come out and say that; the upper loop can NOT survive if wages are inadequate in the lower loop.

India
2012, "Govt sets target to skill 500 million people by 2022"
2017 "Govt abandons goal of training 500 mn people by 2022"
There is too little recognition that globalism and automation have permanently wiped out labor demand. The Indians don't even know what to train people for.
The upper loop doesn't produce anything so it must depend of bleeding off the wages of the lower loop where all the production happens. There is less and less to bleed off so, the upper loop does more and more printing to survive.
The upper loop is losing a lot of jobs to automation also.
The top levels of the upper loop get even more income (temporarily) as labor's share of the GDP is reduced.
The money that flows to the very top flows AWAY from purchasing power of the middle class. The more that the economy is "financialized", the more that consumption and commerce fall. The corporatists want to reduce wages even further to compensate for the drop in profits from trade and consumption.

India is a very poor country with very low labor rates. If India can't figure out where the job markets of the future will be, what is the West going to do?

Kunstler brings some grim humor; Moby Trump - Kunstler

[Danny B]

Failing economy... rising rates

The consumer is busted.
'Uneven", my culo !

As the FED hikes, more and more companies and States will find it harder to service their debt. You can bet that the higher prime rate will NOT be passed on to savers.
At this point in time, 72% of businesses are not profitable, Record "Wealth" In America? 72% Of US Businesses Are Not Profitable | Zero Hedge
Here is a graph of FED "tightening" http://www.zerohedge.com/sites/defau.../GPC614172.jpg
The FED will set off a bomb somewhere in the markets, When the Fed Tightens, It Leads to Financial "Events" | Zero Hedge
The Quants and Algos are doing 90% of the stock trades. How will they react when the defaults happen? Just 10% of trading is regular stock picking, JPMorgan estimates

FED GOV has $212 trillion in unfunded liabilities. Throw in another $7 trillion for State and local GOV. Illinois will show us the roadmap.

Unexpectedly? Our income has been falling for decades.

ALL of the CBs are printing in unison so that no State's currency will be seen as a safe haven. If a State's currency goes up, it loses export market share. If you look at the U.S. dollar compared to a basket of currencies, the value had been fairly steady.
For all of history, you could buy one ounce of gold with another ounce of gold. The price was static, varying only depending on world turmoil. Here is a graph of the price of the dollar. The chart is labelled, "the price of gold".

http://www.zerohedge.com/sites/default/files/images/user227218/imageroot/2017/06/11/Gold-Price-January-1971-to-January-1980.png

The finance loop must constantly inflate the money supply for the non-producers to have an income. ALL of their financial support is passed on to the eventual consumer. They pay the inflation tax also but, all of their income is sourced from inflation to begin with. Labor's share of the GDP has been falling for decades. The finance sector has grown by leaps and bounds, they only survive on freshly-printed money.
A currency note is a claim on goods and services. The CB pulled consumption forward by lowering rates. The banks have pulled consumption forward by creating liar-loans. The banks are now pushing sub-prime RE loans again.
Every debt-note creation without a corresponding creation of new wealth just pumps a bit more air into the credit bubble.
Everyone believes that they hold a great deal of wealth.

GOV must pump in liquidity to maintain confidence. GOV is buying up all the stock and bonds that come up for sale. GOV must keep investors from cashing-out.
The FED managed to keep everything moving during the obummer administration. It looks like they are going to pull out the rug for the current admin. At some point, the great collateral grab is going to take out almost everyone.

[wayne.ct]

The truth in a sea of lies

Much of what you say is, of course, true. And, the bone I pick is not with YOUR word, but the word of others. That bone is the fake facts repeated whenever new GDP numbers are announced, not to mention the idea that the FED has somehow miraculously raised interest rates by the sleight of hand known as the discount rate. Now, to my point about the GDP. The GDP is a BIG LIE. You know this, of course, but it seems you are in the 0.0001 percent. About 300 people out of the roughly 300,000,000 in the US actually know that GDP is not the gross domestic product as the initials indicate. What is included in the GDP? Such things, of course, as the business transacted by banks and "government". What business is that? It is not truly business. If is positively not production or product. It has no business being included in the GDP since it is not really a product. GDP is not a measure of "product" as if, somehow, a service is a product. I can hire a plumber or fix my own toilet or let my toilet leak. It is my decision and I can contribute to the decline of the fake GDP any day of the week by procrastination. At the same time, the pundits and PTB can increase the phony GDP at will by various means using phony paper or electronic means but the biggest fraud is making people imagine the GDP is the gross domestic product when it is not. Perhaps someone can extract the true productivity data from the official tabulation but if they did would I believe it? I don't know I would be able to recognize the true figures if they were available. I am doing what I can and what I believe is best for me and I'm feeling pretty good right now. I can only hope I feel the same a few weeks from now.

[Danny B]

The galloping printing press

The GDP is essentially a count of how much money is in the system. When GOV prints money, GOV counts it as part of the GDP. When GOV spends this money it counts it a second time as part of the GDP. U.S GOV spends about 24% of the GDP. But, it spends debt-money that purportedly must be paid back to banks and investors. The more that it spends today, the more inflation it gets. BUT, as this debt is repaid (extracted from the producing economy), the more deflation we get at some future point.
This future deflation can only be held at bay by pumping ever-more money into the system. There is always a risk that these bonds might not be rolled over. That would bring the dreaded deflation. The solution is for GOV to sell 50 year and 100 year bonds.

There are 102 million working-age people who are not employed. Somehow, the economy is still growing. The take-away from all this is; don't give a moment's notice to ANY GDP figures.

[Danny B]

The unfolding collapse of another empire

Charles Hugh Smith brings great clarity and historical interpretation to present day events. Strauss and Howe wrote very clearly about generational turnings, https://en.wikipedia.org/wiki/Straus...ational_theory
Joseph Tainter wrote very clearly about the collapse of complex societies, https://en.wikipedia.org/wiki/Joseph_Tainter

https://www.youtube.com/watch?v=G0R09YzyuCI

These are not works of speculation or projection. They are the history of the human race. Modern man (whoever that may be) seems to believe that we are on a permanent high plateau of "wealthy society".

Smith,
"Sir John Glubb listed a few others in his seminal essay on the end of empires The Fate of Empires, what might be called the dynamics of decadence:"
" Historian Peter Turchin, whom I have often excerpted here, listed three disintegrative forces that gnaw away the fibers of an Imperial economy and social order:
1. Stagnating real wages due to oversupply of labor Automation
2. overproduction of parasitic Elites
3. Deterioration of central state finances
War and Peace and War: The Rise and Fall of Empires"
"2. The belief in the permanence of the status quo has reached quasi-religious levels of faith. The possibility that the entire financialized, politicized circus of extremes might actually be nothing more than a sand castle that's dissolving in the rising tides of history is not just heresy--it doesn't enter the minds of those reveling in refinement or those demanding more Bread and Circuses (Universal Basic Income, etc.)"

"We can be quite confident that these powerful elites reckoned the Empire was permanent and its power to secure their wealth and power was effectively unlimited. But alas, their fantastic wealth vanished along with the rest of the centralized, over-extended, complex and costly Imperial structures."
"But the complete collapse of the financial system and centralized power is not a war or financial crisis--these are storm waters which the Elites have the wherewithal to survive. But when a tsunami disintegrates the entire structure and carries it out to a nameless sea as flotsam and jetsam, there is no transfer of wealth from the Old to the New."
oftwominds-Charles Hugh Smith: The Dead Giveaways of Imperial Decline

As we decline, the State demands ever-more money to support ever-more State sycophants.
"Jerry Brown is so worried about the environment, but not the people. California is the highest taxed state and they still want to tax people fully upon retirement. California is a complete black hole. The people do not even realize that government has been so corrupt, that every person in California owes $93,000 at the end of 2016 to cover state employee pensions."

https://www.armstrongeconomics.com/world-news/climate/governor-jerry-brown-of-california-advocates-the-overthrow-of-usa/

There is more than one way for the State to squeeze out money. "Policing for profit" works very well for squeezing the poor who have no money for a lawyer. http://www.valuesandcapitalism.com/p...ebtors-prison/

There isn't a prayer that pension funds can squeeze out the taxpayer funds to keep going.

http://www.zerohedge.com/news/2017-06-14/disturbing-trend-will-end-full-fledged-pension-crisis

The environmentalists want to do a big population reduction, https://www.armstrongeconomics.com/w...ve-the-planet/

In their comprehensive annual financial report, The California university system reports that they have over $90 billion stashed away. Walter Burien shows the CAFR reports of some 27,000 GOV entities.

http://cafr1.com/

Collectively, they hold over $ 100 trillion in assets. He proposes that there is NO need for taxes. WE are collectively squeezed by the State. WE have cut back on our birth rate. Is all of this squeezing done in the name of population reduction? It certainly looks that way.
Is the coming crash specifically structured to kill a lot of people, especially the poor? A crash of the pension system will definitely take out the elderly. A crash in the sovereign bond market will definitely destroy the safety net.
Decide for yourself.

[Danny B]

https://www.washingtonpost.com/news/wonk/wp/2017/06/15/the-trump-administration-is-fighting-over-how-to-keep-the-government-out-of-default-and-time-is-running-short/?utm_term=.38ffc53cab18

https://www.bloomberg.com/view/articles/2017-06-13/the-old-are-eating-the-young

Venezuela is getting worse by the week, Venezuela Defaults On Russia; Is Goldman Sachs Next? | RealClearMarketsNote to Janet.

Peak Economic Delusion Signals Coming Crisis

The current and long-running mantra is FREE MARKETS. But, if the FED must constantly increase the money supply by 2% every year, there is no real price discovery. The CB must pump in all that liquidity to support legions of non-producers. The resulting inflation tax is paid for by all the producers.
Free markets and crony-capitalism just can't co-exist.

"population growth began decelerating and the Fed wasn't willing to accept the decelerating consumer growth the "market" was capable of providing. The basis for the expanding pie began decelerating (and is now set to cease entirely)...but the Fed didn't want to live with smaller slices. The Federal Reserve chose to extend growth rates beyond what was otherwise fundamentally possible or sustainable. The Fed wanted the same rate of growth regardless the implications."

"And if we broaden out to the annual growth of the much larger 15-64yr/old US population...its growth has decelerated to perhaps the slowest in the last century. And against the lack of growth, household net worth as a % of disposable income hits a new record high. The Fed is using its policy "tools" to falsely engineer financially what is not there fundamentally."

"Yes, as of 2018 the global 0-64yr/old population with all the income, savings, and access to credit begins declining. This is why central bankers have gone wild and about to go far wilder...pushing asset valuations even further into the (fundamentally unsupported) stratosphere. The Fed and central bankers have feared and subverted the slowing "free market" for decades and now are rightly freaked out by what would ensue if a "free market" were allowed to set prices."
This article has EXCELLENT graphs, https://econimica.blogspot.com/2017/...f-century.html

[Danny B]

Stocks are going to blow so, jump into the market

Madness of crowds. Asset valuations, http://nrimg.ksmobile.net/cmnews/201...40_600_316.jpg
OK, so markets are up to the stratosphere. Now would be a good time to get out. Lots of big-time investors are warning that the markets are going to crash. In a market downturn, it is often difficult to find a "bigger fool" to take bad paper off your hands. The FED and PPT are now playing the "bigger fool" and buying all the overpriced garbage.
Apparently, the mob is afraid of missing out on the profits.
"look no further than the latest BofA "flow show" in which Michael Hartnett reports that capital markets just saw their biggest week of equity inflows since the US election ($24.6bn), another chunky inflow to bonds ($9.0bn), which combines to "the second largest week of inflows to Wall Street ever (largest was $35.5bn in Dec'2014)."
The Blow-Off Top Is Here: Second Largest Weekly Inflows To Wall Street In History | Zero Hedge

Dodgy debt is starting to default in big numbers so,
"Another winner according to BofA: "yield": investors are still piling into "high-yielding" fixed income product with inflows to IG, HY, EM debt = $35bn past 4 weeks, fastest pace since Feb'15 (Chart 2)"
Don't call them "junk Bonds",,,, call them high-yield. China is close to blowing so, gamblers pile in to emerging market debt.
The money is leaving faster and faster.


"The world is currently as far from a harmonious equilibrium as it has ever been in history. The masses are ultimately responsible for $2.5 quadrillion of debts derivatives and unfunded liabilities."
"Since the $2.5 quadrillion liabilities can never be repaid or run down in an orderly fashion, we will in the next few years experience a debt implosion which will be totally devastating. Not only will debt implode but also all the assets that have been fuelled by the debt bubble."

"The coming six month period and especially the autumn, is likely contain a lot of shocks. The investment community is totally oblivious of the risks they are taking by having most of their money in assets that have reached stratospheric values whether it is the stock market at a 30 p/e or property prices at bubble values worldwide or bonds at zero percent. All these asset markets only have one way to go and that is massively down. "

https://goldswitzerland.com/will-gold-reach-2-6-million-or-just-150000/

"We naturally cling to the euphoria and glory of a boom; they generate such hope and positive emotions. The bust is no fun at all, a slow cascade of layoffs, insolvencies, moves to cheaper and far less exciting locales, busted dreams and all the mourning that accompanies the shattering of dreams and hopes."
Can We See A Bubble If We're Inside The Bubble? | Zero Hedge

https://www.armstrongeconomics.com/world-news/taxes/france-police-hunting-tourists-to-shake-them-down/

http://www.zerohedge.com/news/2017-06-14/you-wont-believe-stupid-new-law-against-cash-and-bitcoin

[Danny B]

https://www.theatlantic.com/business/archive/2017/06/the-hoarding-of-the-american-dream/530481/

GM Extends Plant Shutdowns As Toxic Trifecta For Auto Loans Fuels Carmageddon | Zero Hedge

London is a huge banking center so, of course, Merkel wants to move it out of London due to Brexit. https://www.armstrongeconomics.com/i...ndon-to-paris/
She also wants total control of the Net, https://www.armstrongeconomics.com/w...n-of-internet/

The State of Illinois is on death watch

https://dollarcollapse.com/debt/welcome-third-world-illinois-death-watch/

no mention that it is about $ 1.2 trillion here,,, with a default rate of between 18---45%.... everybody is lying.
The FED had no clue in Great depression one and it has no clue for Great Depression two, https://dailyreckoning.com/fed-repeating-mistake-1937/

"in an ironic twist, in order to challenge the "unofficial" digital currencies that have propagated in recent years, central banks have also been called on to create distinct official digital currencies, and allow citizens to bypass private sector lenders. As Weidmann explained, this will only make the next crisis worse:"
"Essentially, Weidmann warned that digital currencies - whose flow can not be blocked by conventional means - make an instant bank run far more likely, and in creating the conditions for a run on bank deposits lenders would be short of liquidity and struggle to make loans. "

http://www.zerohedge.com/news/2017-06-14/bundesbanks-weidmann-digital-currencies-will-make-next-crisis-worse

[Danny B]

C. H. Smith and the anatomy of the debt supernova

C. H. Smith, "As I noted yesterday in Will the Crazy Global Debt Bubble Ever End?, I've used the Supernova analogy for years, but didn't properly explain why it illuminates the dynamics of financial bubbles imploding. "
" A key feature of a pre-supernova super-massive star is its rapid expansion. As the star consumes its available fuel via nuclear fusion, the star's outer layer expands. Once there is no longer enough fuel/fusion to resist the force of gravity, the star implodes as gravity takes over.

This collapse ejects much of the outer layers of the star in an event of unprecedented violence. "
" In other words, debt is limited by earnings. If earnings decline, or fall far behind the expansion of debt, eventually borrowers can no longer borrow more, or refuse to borrow more. "
Stock earnings are dead. Bonds are ZIRP or NIRP. Wages are falling.
"In a deflationary supernova, defaults--and the avoidance of additional debt--are the gravity that overwhelms the forces of expanding debt. Once the losses and risk are visible to all participants, the herd psychology changes, and participants no longer believe that central banks "are now the ultimate power in the Universe."
Herd psychology is just amazing at this point. The muppets actually believe the total BS numbers from GOV. How fast will this turnaround when something pricks their confidence?

"Central banks can create currency and credit, but they can't create earnings or productive real-world wealth. These are the limiting dynamics of any debt-dependent system. "
"The financial implosion triggers social and political upheavals. Recall that one person's debt is another entity's asset. When debt is blown off in either a deflationary or inflationary implosion, all the "wealth" represented by debt is also blown off. "
"And how much did expanding debt boost productivity? Oops! Rapidly expanding financialized (i.e. unproductive) debt is Kryptonite to productivity. "
"when the Empire collapses, the debt-assets of the super-wealthy are blown off in the supernova along with all the other artificial constructs of our corrupt, corrupting, rapacious, exploitive system."
Of Two Minds - How Debt-Asset Bubbles Implode: The Supernova Model of Financial Collapse
Keep in mind that the super rich own GREAT riches. They will lose the most.

[Danny B]

was a moderately homogeneous society. They were formerly very rich and now, are very poor. They had good wages and social programs and, now they don't.
"The body says some 60 people were recorded as killed in lynchings in the first five months of this year alone.
Last year there were 126 such killings "
"Their aim is to kill the person before the police arrive," says Marco Ponce, coordinator of the Venezuelan Social Conflict Observatory (OVCS)."

https://www.yahoo.com/news/venezuela-mobs-kick-burn-thieves-lynching-epidemic-094329281.html

America is turning quite violent and is far less homogeneous racially than Venezuela. The removal of GOV programs under a shutdown can be expected to make things much worse.
Summer of Hate: The Arrival of the Crisis and The Second Civil War? - Stock Board Asset

sure, end the stimulus and,,, Italy crashes within 3 hours.

Don't even mention nuke power. The rise of solar will absolutely trash the financials that are heavily invested in carbon. If even natural gas can't compete, what chance do the others have?

It is well known that Hitler's Germany had to be trounced because he bypassed the international bankers. Evidently, the same was true of Japan many decades ago. They just produced the money that was needed for the producing economy, NOT for speculation.
Start watching at 3:45, https://www.youtube.com/watch?v=mH9VG0iUmug
Japan has HUGE debt at the moment. In the Vid, it is mentioned that Japan owes the debt to themselves and have re-created the system that previously worked so well for them.
China has a huge debt and it is starting to look like they will just carry the debt and print what they need,,, independent of the international bankers.

The Anglo-American curse that originated in London and transferred to other European capitals centuries ago is winding down. There is no question that the debt bubble will blow. The Central Banks will try to maintain their monopoly. If Japan and China use debt-free money, the rest of Asia will follow. The FED can no longer use gun-boat diplomacy to hold down all the other economies.
It LOOKS like a war is to be started up against Iran. BUT, isreal is the hostage, "Israel anticipates 230,000 incoming missiles during next war "
The sabres will rattle,,, the deep state will block Trump,,,The markets will go up in smoke.
Make no misteake , Central banks have just one purpose. Remember, war is the most profitable enterprise for them.
"Early central banks were commonly set up to provide
finance to help fund wartime governments." Page 3
"The gold standard was overwhelmed by the financing needs of governments during World War I." page 4
This is a very informative paper authored by Weber, Trichet, et al.

http://group30.org/images/uploads/publications/G30_FundamentalsCentralBanking.pdf

The very educated authors are very convincing that we MUST have constant monetary inflation for the system to "work"
It is all so logical and convincing.

[Danny B]

Hugo Salinas Price

Where Are We Today?
Hugo Salinas Price

The US has been regarded as the West's leader since WW II. The US led with the objective of international cooperation to achieve orderly growth and prosperity for the countries led by the US.

Now suppose you have a football team, and the quarterback comes out and says, "Quarterback is First!" and scolds members of his team, and insults one of his team-mates and sends him to the bench in disgrace. How long is that team going to hold together? Not very long, I would say.

The deeper fact is that the status of the US as the world's leader, since the end of WW II, has ended and is finished. Mr. Trump's own plan to "Make America Great Again" is sending, by his own admission, a silent message: "America is no longer great."

If the US does actually clamp down on imports, as Mr. Trump envisions, and begins to hide behind economic protectionism through taxes on imports in true "developing world" fashion, then the US will be blocking the spring from which the rest of the world has been getting its dollars; there will be a scarcity of dollars in the rest of the world and that will mean world deflation with all its consequences: a rash of bankruptcies around the world for lack of dollars to service debt.

The US simply cannot have it both ways: it cannot issue the world's money, and indulge in economic protectionism. If the US goes for economic protectionism, then US dollar will, sooner or later, cease to be the world's money as steps are taken to replace the dollar.

In human affairs, when one leader is gone, it is not long before another leader takes over.

As the US passes from the scene as the world's leading country, who will inherit the throne of world leadership?

With the defeat of Napoleon Bonaparte's combined French and Spanish fleets at Trafalgar in 1805, Britain obtained mastery of the world's oceans and of world trade for the next century and more. Later, with the defeat of Napoleon at Waterloo in 1815, world leadership settled on Great Britain.

With the 1945 defeat of the Axis armies in WW II by the combined forces of Great Britain and the US, world leadership passed from Great Britain to the US.

As 72 years of world leadership on the part of the US fade into history, who will take over world leadership? I suggest it will be Eurasia: Europe, Russia and China in economic cooperation.

Will the transfer of leadership take place peacefully, or will it require a WW III?

I do not think that anyone in the US wants a nuclear war with Russia and China. However, a great economic interest group in the US - the Military/Industrial/ Congressional Complex (as President Eisenhower initially identified this political machine) - lives on a gigantic yearly flow of funds from the US Government budget, and this flow depends on the perceived threat of an enemy for its existence. "No enemy" would mean no hundreds of billions of dollars a year for the coffers of this vast interest group.

This is why Mr. Trump's initial proposal to establish better relations with Russia has been scrapped: the Military/Industrial/Congressional Complex has a vested interest in having Russia as an enemy.

The great danger for the US is that while no single American or group of Americans may actually want a nuclear war with Russia and China, some small accident may rapidly scale into outright world war.

In the past, Russia suffered the loss of tens of millions of its population because it patiently waited for its enemy to attack. Russia learned a very painful lesson by being patient. If war appears to be the definite plan on the part of the US, it is possible that Russia may strike the US first.

This is where we are today."


"Bonds Will Not Turn Into a Noah's Flood of Cash
Hugo Salinas Price

I enjoyed talking with Greg Hunter, of Real News from Greg Hunter’s USAWatchdog: Economic News and Breaking News Reports over a Skype Interview - one of the marvels of our time, where we can see and talk with friends who are thousands of miles away from us.

Unfortunately, Greg caught me off balance at the beginning of our interview, with a question for which I was quite unprepared - I had been expecting to talk about silver and its possible monetization in Mexico.

The question which put me in a momentary fix was, in general and not word-for-word: "What about that enormous black debt cloud that you have said is hanging over the world? What happens when the debt cloud begins to rain debt on the world?"

Well, when clouds release their moisture, it rains. But when a debt cloud is "saturated" so to speak, it does not rain cash, contrary to what I said in the spur of the moment: "We shall have a Noah's flood of cash." My bad!

No, when at some point the total of world debt hanging over humanity has reached a point where the owners of that debt - which consists mainly of bonds - are going to want to sell their bonds, there will be more sellers of bonds than purchasers, and their prices will begin to fall.

At some point, the initial fall in the values of bonds will cause fear that the fall in price may continue, and more sellers will show up.

In short order - fear is very contagious! - sellers will far outnumber purchasers of bonds and their price will collapse - many of the bonds will become worthless, others will lose a large percentage of their value.

The bond rout will wipe out multi-trillions of dollars of what the bond holders thought was wealth.

That is what I think will have to happen, at some point. Bonds will not turn into cash, they will turn into dust.

We won't have a "Noah's flood" of cash. We'll be stuck in the middle of a Sahara Desert of worthless bonds."