The US WILL Default

If you believe that our leaders have even the slightest clue of how to solve the economy's problems, Obama's jobs proposal should rid you of your delusion.

This is not a matter of political affiliation nor is it an attack of Obama as a person. It's a simple matter of basic math.

Obama wants to spend roughly $500 billion to create two million jobs (that's the claim at least). Put another way, Obama would spend roughly $250,000 to create a single job. That's a heck of a lot of money in an economy in which the average income is $50K or so.

That's just the basic math. I'm not even bothering to assess the fact that the Government is already spending over $1 TRILLION per year and hasn't created a sustainable job recovery.

So how exactly will another $500 billion change things?

Also, where is the Government going to come up with this money exactly? Didn't we just say we needed to hike the debt ceiling by another $500 billion? Aren't we already running Debt to GDP and Deficit numbers that are on par with Greece: a country that is guaranteed to default in the near future?

Folks, this is the hard truth: the US is broke and our leaders have no clue how to solve any of the structural issues our economy and markets are facing. They've spent TRILLIONS propping up the stock market but haven't created new jobs nor have they improved Americans' quality of life in the last two years.

In other words, we're at the End Game for Government Intervention in the economy and marketplace. Greece has already shown us what's coming: default and debt restructuring.

After all, there are only two ways to deal with a debt problem:

1) Pay it off

2) Default

The US has no chance at all of ever paying off its debts, which means some form of default and restructuring is coming our way in the future. And when this hits, it will make 2008 look like a picnic.

Comment:

Comrades, I really like this Graham Summers. He's not one of us, but he sure sounds like it! What's more, he's 110% right.

We can never pay off the debt. It's too high. If we were talking about an individual, the solution to the problem would be bankruptcy. Why not? Is it possible for an entire nation to declare bankruptcy? If it is, then we should do it.

The Judeo-Capitalists have made bankruptcy seem shameful. Like you're a deadbeat and a failure. Yet they don't hesitate to declare a Chapter 11 or 13 whenever it suits their purpose. Why shouldn't we? It's a legal right we all have when we get in too deep.

The United States has been in too deep for decades. If bankruptcy is an option, then we should use it.

When the Depression hit in 2008, I was about to lose my house to foreclosure. I asked a lawyer which is worse, a bankruptcy or a foreclosure. They said a foreclosure is worse. So, I declared bankruptcy, and handed the house back to the bank, and got my five credit cards (about $10,000 worth of unsecured debt) discharged. It was a major weight off my shoulders.

I still had my mobile home so I just moved back. No sweat. Well, yes sweat. Moving always works up a big sweat!LOL I lived without credit for about a year. Hard, but not impossible. I simply lived within my means, as we all should do all the time. No real hardships, no shame.

After about a year, I was offered a Mastercard with a $300 limit. It was for people who have recently been through a bankruptcy. I kept my balance low. Made more than minimum payments, and a year later, I got another card from a different bank. I now have two, and I won't get another. One card has a zero balance, and the other has a balance of about $200 from extra expenses I ran up when I went to the conference in Laurens last July. I should have it paid off by the end of this year. I will never allow myself to get into the credit trap again. Neither should anyone else.

Unless we, and that includes the government all learn to live within our means, we'll be forever doomed to economic slavery, which is exactly what the Fat Cats want.

The US WILL Default

If you believe that our leaders have even the slightest clue of how to solve the economy's problems, Obama's jobs proposal should rid you of your delusion.

This is not a matter of political affiliation nor is it an attack of Obama as a person. It's a simple matter of basic math.

Obama wants to spend roughly $500 billion to create two million jobs (that's the claim at least). Put another way, Obama would spend roughly $250,000 to create a single job. That's a heck of a lot of money in an economy in which the average income is $50K or so.

That's just the basic math. I'm not even bothering to assess the fact that the Government is already spending over $1 TRILLION per year and hasn't created a sustainable job recovery.

So how exactly will another $500 billion change things?

Also, where is the Government going to come up with this money exactly? Didn't we just say we needed to hike the debt ceiling by another $500 billion? Aren't we already running Debt to GDP and Deficit numbers that are on par with Greece: a country that is guaranteed to default in the near future?

Folks, this is the hard truth: the US is broke and our leaders have no clue how to solve any of the structural issues our economy and markets are facing. They've spent TRILLIONS propping up the stock market but haven't created new jobs nor have they improved Americans' quality of life in the last two years.

In other words, we're at the End Game for Government Intervention in the economy and marketplace. Greece has already shown us what's coming: default and debt restructuring.

After all, there are only two ways to deal with a debt problem:

1) Pay it off

2) Default

The US has no chance at all of ever paying off its debts, which means some form of default and restructuring is coming our way in the future. And when this hits, it will make 2008 look like a picnic.

Comment:

Comrades, I really like this Graham Summers. He's not one of us, but he sure sounds like it! What's more, he's 110% right.

We can never pay off the debt. It's too high. If we were talking about an individual, the solution to the problem would be bankruptcy. Why not? Is it possible for an entire nation to declare bankruptcy? If it is, then we should do it.

The Judeo-Capitalists have made bankruptcy seem shameful. Like you're a deadbeat and a failure. Yet they don't hesitate to declare a Chapter 11 or 13 whenever it suits their purpose. Why shouldn't we? It's a legal right we all have when we get in too deep.

The United States has been in too deep for decades. If bankruptcy is an option, then we should use it.

When the Depression hit in 2008, I was about to lose my house to foreclosure. I asked a lawyer which is worse, a bankruptcy or a foreclosure. They said a foreclosure is worse. So, I declared bankruptcy, and handed the house back to the bank, and got my five credit cards (about $10,000 worth of unsecured debt) discharged. It was a major weight off my shoulders.

I still had my mobile home so I just moved back. No sweat. Well, yes sweat. Moving always works up a big sweat!LOL I lived without credit for about a year. Hard, but not impossible. I simply lived within my means, as we all should do all the time. No real hardships, no shame.

After about a year, I was offered a Mastercard with a $300 limit. It was for people who have recently been through a bankruptcy. I kept my balance low. Made more than minimum payments, and a year later, I got another card from a different bank. I now have two, and I won't get another. One card has a zero balance, and the other has a balance of about $200 from extra expenses I ran up when I went to the conference in Laurens last July. I should have it paid off by the end of this year. I will never allow myself to get into the credit trap again. Neither should anyone else.

Unless we, and that includes the government all learn to live within our means, we'll be forever doomed to economic slavery, which is exactly what the Fat Cats want.

Bernanke's Losing Control Again

by Graham Summers

Bernanke has a real problem on his hands. QE 2 spent $600 billion and got him at best a few months' worth of upticks in well-massaged economic data. In the process it blew up food and energy prices and made the Fed look even stupider than usual (Bill Dudley's iPad comment comes to mind).

However, the US economy clearly took a nosedive starting in February of this year and we now have a confirmed double dip in housing. So Bernanke's little brain is whirring with the prospect of printing even more money because... well, that's all he does.

So, what can he do? He can't just go and announced QE 3 without risking his own neck... but at the same time, he can't just have stocks crater overnight by turning the printer off.

Solution: he continues to funnel money into Wall Street via less publicly offensive policies such as QE lite (see the story below):

While the $600 billion purchase program, known as QE2, winds down, the Fed said June 22 that it will continue to buy Treasuries with proceeds from the maturing debt it currently owns. That could mean purchases of as much as $300 billion of government debt over the next 12 months without adding money to the financial system.

http://www.bloomberg.com/news/2011-06-27/fed-seen-buying-25-billion-a-month-in-treasuries- after-qe2-comes-to-end.html

The only question is whether this will be enough juice for the markets until the inevitable QE 3 or some such additional liquidity measure is announced (Bill Gross has hinted it will be unveiled at the Fed's August FOMC).

The Fed pulled a similar stunt in 2010 when QE 1 ended. However, at that time the game consisted of pumping the system during options expiration weeks to the tune of $20-30 billion tops. This time around, the Fed could be funneling as much as $300 BILLION... and somehow the Fed's in control of things?

I've said it before and I will say it again: Bernake is slowly losing control of the system. In 2007, he was putting $30 billion into the system here and there. In 2008-2010, he upped the ante to $50 billion PER MONTH. QE 2 pushed the amount up to $100 Billion per month. And here he is, hinting at giving ANOTHER $300 BILLION when QE 2 ends!?!?

Folks, there is a name for a financial game that requires larger and larger sums of money to continue. It's called a Ponzi Scheme and the longer it lasts the more disastrous the collapse will be.

Comment:

You read it comrades. The longer the Federal Reserve's Ponzi Schemes last, the bigger the inevitable collapse will be.

Also, unless the U.S. Government can "work something out" with China, we'll default on our loans in August. The big collapse may be only a month away. However, I'm sure they'll come up with a "temporary" solution. But like Mr. Summers said, delaying things will only make it worse in the long run. It's like getting a cash advance on one credit card to make a payment on another. Eventually, all your cards will be maxed out, and then what? That's exactly what our great government is doing right now. Making loans to pay the interest on other loans. It wouldn't be so bad if we were taking out a loan to pay off another loan. In the real estate game, that's called refinancing. But what the government is doing is taking out more loans just to make interest only payments. That's plain crazy. The well will run dry eventually - like in August. Even if the government finds a few extra drops, it won't last long.

Comrades, I'm no financial expert. I can barely balance my own check book. But what's China supposed to do if we do default? Foreclose? Hardly. The U.S. is their number one customer for all their plastic crap. Sue us? In what court and with what army will the judgement be enforced?

I say just default. To hell with all of them. Like I asked, what are they going to do about it? Cut off our credit? Well, since our credit rating is zilch now anyway, it doesn't really matter. All it will really mean is that this country will have to stand on its own two feet again and take care of all our own needs. We did it for almost 200 years, and we can do it again. National Socialism is the best way. We have a plan, good people, and the determination to make it work. If you want to be a part of it, then become an Official Supporter if you aren't already. Hail Victory!

Dan 88!

Bernanke's Losing Control Again

by Graham Summers

Bernanke has a real problem on his hands. QE 2 spent $600 billion and got him at best a few months' worth of upticks in well-massaged economic data. In the process it blew up food and energy prices and made the Fed look even stupider than usual (Bill Dudley's iPad comment comes to mind).

However, the US economy clearly took a nosedive starting in February of this year and we now have a confirmed double dip in housing. So Bernanke's little brain is whirring with the prospect of printing even more money because... well, that's all he does.

So, what can he do? He can't just go and announced QE 3 without risking his own neck... but at the same time, he can't just have stocks crater overnight by turning the printer off.

Solution: he continues to funnel money into Wall Street via less publicly offensive policies such as QE lite (see the story below):

While the $600 billion purchase program, known as QE2, winds down, the Fed said June 22 that it will continue to buy Treasuries with proceeds from the maturing debt it currently owns. That could mean purchases of as much as $300 billion of government debt over the next 12 months without adding money to the financial system.

http://www.bloomberg.com/news/2011-06-27/fed-seen-buying-25-billion-a-month-in-treasuries- after-qe2-comes-to-end.html

The only question is whether this will be enough juice for the markets until the inevitable QE 3 or some such additional liquidity measure is announced (Bill Gross has hinted it will be unveiled at the Fed's August FOMC).

The Fed pulled a similar stunt in 2010 when QE 1 ended. However, at that time the game consisted of pumping the system during options expiration weeks to the tune of $20-30 billion tops. This time around, the Fed could be funneling as much as $300 BILLION... and somehow the Fed's in control of things?

I've said it before and I will say it again: Bernake is slowly losing control of the system. In 2007, he was putting $30 billion into the system here and there. In 2008-2010, he upped the ante to $50 billion PER MONTH. QE 2 pushed the amount up to $100 Billion per month. And here he is, hinting at giving ANOTHER $300 BILLION when QE 2 ends!?!?

Folks, there is a name for a financial game that requires larger and larger sums of money to continue. It's called a Ponzi Scheme and the longer it lasts the more disastrous the collapse will be.

Comment:

You read it comrades. The longer the Federal Reserve's Ponzi Schemes last, the bigger the inevitable collapse will be.

Also, unless the U.S. Government can "work something out" with China, we'll default on our loans in August. The big collapse may be only a month away. However, I'm sure they'll come up with a "temporary" solution. But like Mr. Summers said, delaying things will only make it worse in the long run. It's like getting a cash advance on one credit card to make a payment on another. Eventually, all your cards will be maxed out, and then what? That's exactly what our great government is doing right now. Making loans to pay the interest on other loans. It wouldn't be so bad if we were taking out a loan to pay off another loan. In the real estate game, that's called refinancing. But what the government is doing is taking out more loans just to make interest only payments. That's plain crazy. The well will run dry eventually - like in August. Even if the government finds a few extra drops, it won't last long.

Comrades, I'm no financial expert. I can barely balance my own check book. But what's China supposed to do if we do default? Foreclose? Hardly. The U.S. is their number one customer for all their plastic crap. Sue us? In what court and with what army will the judgement be enforced?

I say just default. To hell with all of them. Like I asked, what are they going to do about it? Cut off our credit? Well, since our credit rating is zilch now anyway, it doesn't really matter. All it will really mean is that this country will have to stand on its own two feet again and take care of all our own needs. We did it for almost 200 years, and we can do it again. National Socialism is the best way. We have a plan, good people, and the determination to make it work. If you want to be a part of it, then become an Official Supporter if you aren't already. Hail Victory!

Dan 88!