Monday morning, and it’s hard not to smile at how hard TPTB are trying to make it to look good.
By the end of my workout, I had not one, not two, but THREE potential titles for this RANT, as the “horrible headlines” and criticism fodder kept piling up, at a faster… and faster … and faster pace.
However, I’m going to stick with my gut, the first thing I saw when I awoke this morning, the article below about the exponentially widening gap between the haves and have-nots, in this case depicted by the wealth disparity of the young and the old. In it, the writer lays out a downright terrifying statistical analysis of the plight of America’s youth, featuring the following:
The typical U.S. household headed by a person age 65 or older has a net worth 47 times greater than a household headed by someone under 35; nearly five times the 10-to-1 disparity of 25 years ago, after adjusting for inflation
(Ranting Andy note: Utilizing ACTUAL, not FABRICATED government inflation rates, the gap is FAR WIDER).
The median net worth for under 35 households was $3,662, down 68 percent from 25 years ago
(Ranting Andy note: The U.S. money supply has OVERTLY risen by 10x during this period, and, including COVERT money-printing, risen by significantly more).
In all, 37 percent of under 35 households have a net worth of zero or less, nearly double the share in 1984
(Ranting Andy note: The Dow rose from 1,000 in 1984 to 14,000 in 2007, yet twice as many people under 35 years old are broke. Just four years later, in 2011, the economy is in depression, debt and REAL unemployment at ALL-TIME highs, and the under 35 age group carries, BY FAR, the highest student loan debt load, which by the way is unforgivable, in HISTORY).
Older Americans are staying in jobs longer, while young adults face the highest unemployment since World War II. Consequently, the median income of over 65 households since 1967 has grown at four times the rate of under 35 households.
(Ranting Andy note: Throw in REAL income loss from government CPI inflation fraud, yielding lower Social Security cost-of-living increases, and this statistic describes a lower standard of living for ” the 99%”).
For young adults, their main asset is their home. However, their housing wealth has dropped 31 percent since 1984, the result of increased debt and falling home values
(Ranting Andy note: Even inclusive of the 2007-2011 housing bust, the average U.S. home price is UP 22% since 1984. Thus, this horrible statistic is rooted SOLELY in the increased real estate leverage stemming from the relaxed credit standards and easy monetary policy of the early 2000s).
Age group wealth disparity is a mere subset of the bigger problem, the CLASS WARFARE instituted by “the 1%” on “the 99%” by Washington and Wall Street, which work in concert care via an endless game of corruption, as described to a tee by last night’s 60 Minutes piece about former Washington lobbyist Jack Abramoff.
Finishing the thought, the below article depicts how the just 1% of Americans control 42% of the nation’s wealth, while the top 20% control 93%. Civil, and Revolutionary Wars have started over much less, and in this case, the CLASS WARFARE issue is no different in the States than the majority of the WORLD. That is why we have seen social unrest sprout from places as far-reaching as Europe (Athens, Rome, London), the MENA Region (Egypt, Tunisia, Libya, Syria, Bahrain) to the United States (OWS, etc.).
The reason I chose this direction for my RANT was perusal of excerpts from Gerald Celente’s Trends Newsletter, one of the finest publications in the world. Celente, a native New Yorker as I am, has seen much in his decades of market analysis, and was among the first to forecast, 15+ years ago, that widening wealth disparity would lead to social revolution. He could not have been more prophetic then, and is now one of the top prognosticators in the world today.
This morning brings with it another 20+ “horrible headlines”, so as always I have to figure the best way to present them, as well as which ones to save for a rainy day. But my attention continues to be drawn to the CHAOS in Europe, a continent amidst high-speed financial COLLAPSE, propped only by the untiring presence of Washington/Wall Street/mainstream media PROPAGANDA and government market manipulation.
The weekend commenced with the VOTE OF CONFIDENCE in the Greek government Friday night, prompting CNBC and other shills to prognosticate the “saving of Europe.” Of course, just hours later the Greek Parliament was engaged in full-fledged verbal warfare, eventually yielding the RESIGNATION of Prime Minister Papandreou.
Some confidence, huh?
Yes, I’m sure the NEW government, essentially be the same people in different chairs, will do much better.
Then, of course, there was this weekend’s CME margin change fiasco, prompting it to “clarify” on Saturday that their Friday press release regarding an INCREASE in margin requirements actually meant a DECREASE. Readers, I follow MANY of the top trading minds in the business, and EVERY ONE OF THEM believed the initial CME release referred to an increase, likely due to the ramifications of the MF Global collapse.
The “clarification” cited that instead of a margin INCREASE, a margin DECREASE was being instituted for the following reason:
“… to decrease the size of any margin calls resulting from the bulk transfer of MF Global customers to new clearing members, not to increase them.”
OK, so they were trying to ease the burden of those stuck with frozen, underwater trading positions held at MF Global. But that doesn’t exactly gibe with the article below from THIS MORNING, stating that ALL MF Global account holders face Monday margin calls!
Yep, just another day in the theater of the absurd. Drama aside, however, in this “financial theater” the end result is ALWAYS the same – massive losses for “the 99%” (UNLESS THEY OWN PHYSICAL GOLD AND SILVER), and massive bailouts for “the 1%.”
Next, we move on to Italy, in a state of HIGH-SPEED COLLAPSE as we speak. Prime Minister and neo-mobster Silvio Berlusconi is literally under siege from all directions, having faced tens of thousands of public protestors this weekend and, in his words, the “traitors” in government seeking to unseat him.
Italian bond yields EXPLODED this morning to new ALL-TIME HIGHS, including a mind boggling 29 basis point surge in the benchmark 10-year bond, to 6.62% from 6.33% Friday afternoon…
…while Italian CDS yields rocketed to new highs as well. I guess CDS investors don’t doubt the upcoming Italian bankruptcy will be deemed a “credit event” by the ISDA…
Despite this weekend’s ECB’s ULTIMATUM that they would stop purchasing Italy’s debt if it didn’t get its house in order, they did so again this morning ANYWAY…
Proving, of course, that they can TALK all they want, but in the end they can’t do the WALK, as doing so would entail IMMEDIATE, ABSOLUTE, ECONOMIC ANNIHILATION. Not to mention, when the new head of the ECB is ITALIAN!
Way to go, PPT! In the first 15 minutes of NYSE trading, an entire night of losses was reversed, although they are seeing some pushback by REALITY as we speak.
Amazing how all-EUROPEAN problems are saved by NYSE trading, isn’t it? Obviously, American “investors” know what’s going on in Europe more than Europeans, as they always do.
Just as was the case late last week, when the PPT operated under the guise of “hopes of Papandreou resigning” (which, in the end, didn’t boost markets at all), the rumor this morning behind the PPT’s goosing was “hopes of Berlusconi resigning”, as if that will have ANY impact on Italy’s finances.
Oh well, I guess we’ll just have wait a week or so for his actual resignation, when the PPT will then hype “hopes of Sarkozy resigning” as a potentially bullish event. I got news for you, PPT. After Sarkozy there are just three “resignation hopes” left, and I assure you none will be market-bullish. Those three, of course, being Merkel, Cameron, and “Mr. Hope” himself, Obama.
Before I end today’s RANT, I want to make sure the point of my writing is not forgotten, the aim of helping you PROTECT YOURSELF from the accelerating, and potentially hyperinflation that is the MATHEMATICALLY CERTAIN conclusion of the collapse of European, American, and other global economies. That PROTECTION will be attained by exchanging your depreciating fiat currencies for PHYSICAL gold and silver, which are GUARANTEED to rise for generations to come, at least until the new gold standard is created at MANY MULTIPLES of the current prices.
Per the 2010 Wikileaks document disclosed this weekend, OFFICIAL German documents discussed plans for the contingency of a EuroZone collapse as recently as February 2010. The Germans have the strongest (though weakening) economy in Europe, the most to lose from European bailouts, and the most notorious historical episode of hyperinflation. I ASSURE you they won’t stick with the failing Euro experiment if the EFSF fund cannot be “leveraged” by the Chinese (who have already said no) or some other suckers (of which there will be none), and instead will depart unceremoniously, yielding HYPERINFLATION to the PIFIGS and the other weaker nations.
And speaking of gold, isn’t it funny how something proclaimed so useless by TPTB is not only being acquired AGGRESSIVELY by Central Banks worldwide (both OVERTLY and COVERTLY), but is now becoming the FOCAL POINT of heated CENTRAL BANK VERBAL WARFARE?
Just this weekend, the pathetic PIFIGS (sorry France, you are a PIG!) demanded that Germany, the supposed second largest holder of gold reserves in the world, sell its gold to bail them out. Germany responded with a resounding NO…
…and, in turn, demanded that Italy, the supposed third largest holder of gold reserves (I say supposed as there are allegations that both Germany and Italy may have leased some of it out), should sell theirs!
Does this sound like an asset with no use, one considered a “barbaric relic” by the world’s most powerful bankers?
Readers, the wealth and income disparity that is DRAMATICALLY WIDENING in the U.S. and much of the developed world is the DIRECT RESULT of Central Bank MONEY-PRINTING, led, of course, by the EVIL Washington/Wall Street Axis that has destroyed the world and created the inevitable, hyperbolically destructive period of HYPERINFLATION and CURRENCY COLLAPSE that is upon us.
Only by PROTECTING YOURSELF with PHYSICAL GOLD, SILVER, FOOD, and OTHER LIFE NECESSITIES will you SURVIVE this generational economic calamity and set the stage to THRIVE when the new financial order emerges from the ashes.
HOW AMERICA DESTROYED THE WORLD IN A DECADE
For the past decade, the U.S. government navigated the treacherous waters of a collapsing economy with its printing press. Many cite GLOBAL MELTDOWN I in 2008 as the commencement of its economic malaise, but that is simply not the case.
THIS is what actually happened, all in a measly decade…
America’s FINAL era of prosperity ended with the Tech Wreck of 2000, yielding the first major recession since the Greenspan-led Fed started juicing the money supply in the late 1980s. Pandora’s Box officially opened when Glass-Steagall was repealed in 1999, urging banks to create dangerous investment products, and investors to take the bait. Allowing commercial banks to invent risky investments was like allowing Dr. Jekyll into a lab, an intoxicating opportunity to create “free money” by experimenting with financial fire. Even the world’s “leading minds” believed the internet would render WORK obsolete and WEALTH ubiquitous, a fitting end to a period in which the Eastern Hemisphere was handed a century’s worth of U.S. manufacturing jobs. Most of them by U.S. companies themselves, VOLUNTARILY, by the way.
To wit, General Electric, ‘America’s greatest company,’ at least before Apple emerged as the smart phone king of the world. Over the past decade, GE has shed 34,000 U.S.-based jobs, while adding 25,000 overseas. More than half its employees are now internationally-based, a percentage expected to continue climbing. In 2010, GE’s $5.1 billion of U.S.-based profit was not only untaxed, but the firm received a $3.3 billion tax REFUND. To add insult to injury, GE was BAILED OUT from sure bankruptcy in 2009 by a COVERT U.S. government bailout, fronted by its favorite propaganda puppet, Warren Buffett. Those losses were 100% due to DERIVATIVES EXPOSURE via its toxic finance unit, GE Capital, and you can be sure GE Cap will be back in the news when the derivatives monster consumes its next meal.
After the Tech Wreck, the U.S. was faced with a recession and, simultaneously, enormous secular job losses. The national debt had skyrocketed from $2.6 trillion when Alan Greenspan took over the Fed in 1987 to $5.6 trillion at the peak of the internet bubble in 2000, but no one was asking how that could occur if times were so “prosperous.” The reason, of course, was the dollar was peaking, and with it a frenzied period of borrowing and spending, ending the strongest era of American purchasing power in its history. The world thought the dollar was so strong due America’s “greatness”, when in fact it had more to do with the collapse of the Eastern Block than anything else. But Russia and Eastern Europe eventually recovered, and with their resurgence the ERA OF CHEAP COMMODITIES was over, FOREVER.
Around that same time, circa 2000, Greenspan learned his printing press could be used to stave off recessions, the consequences be damned. Sure, he was a disciple of the ultimate capitalist, Ayn Rand, and wrote Gold and Economic Freedom in 1966. But why go with your gut, or the lessons of history that made him write that piece, when it’s so much easier to PRINT MONEY and espouse theories of new banking paradigms?
Simultaneously, Sir Alan was exposed to the growing strength of OTHER manipulation schemes (aside from money printing), such as the “President’s Working Group on Capital Markets”, i.e. the PPT, and the Gold Cartel, while “sects” of “Greenspanism” emerged on the scene, such as Robert Rubin’s “Strong Dollar Policy” and Larry Summers’ “Gibson’s Paradox.” The POWER of these manipulative tools surged through his veins, and his journey to the DARK SIDE was complete when Wall Street infiltrated Washington with its ill-begotten, post-Glass Stegall profits.
Then came 9/11, the most important inflection point in U.S. history, in my view. This was the day the government OFFICIALLY took over our lives, under the pretense of “national security.” Was it a false flag attack, of which such evidence grows stronger each day, or a band of 20 highly talented, borderline GENIUS Moslem terrorists? I’m not sure we’ll ever definitively know. Irrespective, the loss of American FREEDOM was far more damaging than 2,996 lives in the Twin Towers, the Pentagon, and the four downed planes. Not to mention, the 10,000 dead American soldiers, and more than 1,000,000 civilians either directly or via terrorist bombings.
I know many people don’t care about these deaths, or practically anything that doesn’t prevent them from watching reality TV, playing video games, or texting gossip. However, more than a million people have died because the Bush Administration attacked Iraq with no credible reason, which REALLY PISSES ME OFF. And not to show political favoritism, Obama campaigned heavily on a promise of bringing soldiers home, lying through his teeth and proving to be just as warlike as George Bush.
Back to my RANT, 9/11 represented the time when the government took over our LIVES. The Patriot Act, the the Department of Homeland Security, the TSA, you name it. Anything to subvert the constitution in the name of “national security”, and they did it. Moreover, with America’s quality jobs gone to China (principally due to U.S. government policy, by the way), citizens started to believe the government teat was its only hope of survival, as well as its RIGHT. America’s work ethic withered with its manufacturing base, and government entitlement programs literally EXPLODED, funded by an even bigger EXPLOSION of lobbying dollars, particularly from Wall Street and the military.
By the time the “American Dream Down payment Act” was signed in 2003, Greenspan had successfully usurped the economic cycle by substituting industrial production with MONEY PRINTING, creating a housing bubble far larger, and with far greater ramifications, than the tech bubble. European central banks figured this game out as well, and thus the age of government and banker controlled markets began.
The U.S. had a leg up on Europe because the dollar was the “world’s reserve currency”, and thus added incentive to blow its bubble up larger, greedily putting tens of billions of bonuses and perks into the laps of Washington and Wall Street’s “leaders.” The populace went on an UNPRECENDENTED borrowing and spending spree, and was encouraged to do so by government decree, such as the aforementioned “American Dream Down payment Act,” and corporate greed, via monstrous, essentially unregulated mortgage companies, supplemented by Wall Street-engineered derivative products that “leveraged” the expansion of the real estate bubble. Of course, that all ended when its “weakest link,” the subprime segment, showed the real estate boom to be the Ponzi scheme it was, and, in turn, the Wall Street banks to be the naked emperors they really were.
By now, Ben Bernanke had taken over the Fed, leaving Greenspan to slink into the shadows and spend his remaining days rewriting history by warning of the things HE CREATED AND PRACTICED. Bernanke had not a shred of private sector experience, but from DAY ONE claimed to be an expert on the Great Depression, POSITIVE it could have been avoided if only more money were printed. In this famous 2002 speech, he suggested that, like Greenspan, he would ignore the Fed’s primary mandate of PRICE STABILITY, in lieu of creating nominal GDP gains and inflated stock prices.
The U.S. government has a technology called a printing press (or, today, its electronic equivalent) allowing it to produce as many dollars as it wishes at essentially no cost. By increasing the number of U.S. dollars in circulation, or even credibly threatening to do so, the U.S. government can reduce the value of a dollar in terms of goods and services, which is equivalent to raising prices of those goods and services. We conclude that, under a paper-money system, a determined government can always generate higher spending and hence positive inflation.
It didn’t hurt that the means of MEASURING GDP was mangled beyond recognition, nor the accounting rules governing how corporations accounted for such. In other words, Bernanke realized he not only had a printing press at his disposal, but “fully armed and operational” manipulation teams in the PPT and Gold Cartel, as well as full cooperation of Federal regulation groups such as the FASB, SEC, and CFTC. Furthermore, by then Wall Street had COMPLETELY taken control of the government, allowing it to UNITE its selfish, destructive goals with that of the Fed, which, by the way, it already OWNED!
Throw in the EXPONENTIAL growth in derivatives, High Frequency Trading programs, and the heightened belief that ANYTHING can be papered over with freshly printed money, and the stage was set for the coup de grace, the EXPLOSION of sovereign debt (which, of course, trickled all the way down) that pushed the GLOBAL, dollar-based fiat currency past the point of no return. As my readers are well aware, no currency in HISTORY has survived this long without a major devaluation, or full-out collapse, and thanks to the above “witches brew,”, the GLOBAL monstrosity built over the past 40 years has been pushed to the precipice.
The ball started rolling downhill during GLOBAL MELTDOWN I in late 2008, when the Fed, ECB, BOE, BOJ, et al MAXXED their balance sheets in the name of SURVIVAL, pushing us so far past the Maginot Line, it can no longer be seen in the rear-view mirror. This brazen act of Weimar Era MONEY PRINTING, a slap to the fact of “Mother Financial Nature”, bought TPTB two years of phony market calm. Unfortunately, this deal with the devil ensured the END GAME will occur SOONER rather than later.
The MONEY PRINTING Ponzi Scheme must mathematically end, and is doing so NOW. This is not your typical game of musical chairs, in which one person is OUT while the rest remain IN. In this case, “the 99%” will financially DIE while “the 1%” LIVE. And I do mean “LIVE” and “DIE”, as the ramifications of a collapsed currency are certain to include shortages of food, energy, and other vital life necessities.
In my mind, only one questions remains – WHAT will be the flashpoint ending this lethal experiment in UNFETTERED, GLOBAL MONEY PRINTING?
Will it be an Italian default…
…or chinks in China’s armor…
…yielding PHYSICAL buying powerful enough to destroy the Gold/Silver Cartel…
…or a “black swan event” such as an Iranian military confrontation with Israel or the U.S.?
Who knows, as what ACTUALLY happens could be a “sixth-sigma event” one no one was even aware of (such as MF Global)?
When it comes to LIFE and DEATH financial matters, I don’t take UNNECESARY RISKS. That is why I ONLY own PHYSICAL precious metals, which I view as the lowest risk investment class in the world. PROTECT YOURSELF, and do it NOW!