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.

The US Banks Are Going to Take a BIG Hit

By Graham Summers

The situation in the US Congress marks a new low for politics in this country. I'm not going to bother going into details related to the various plans that have been proposed because all of them fail to be relevant.

What I mean by this is that all of the various cuts ($1 trillion or so over however many years) are in fact irrelevant given the fact that the US is running deficits north of $1.5 trillion PER year already.

As for the debt ceiling, whether we raise it or not is also irrelevant in the grand scheme of things. The US is broke and has been for a long time now. There is absolutely no way we will ever pay back our debts which now stand at $44K per man woman and child in the US.

This of course fails to include social security, Medicare and other unfunded liabilities which put the US debt levels closer to $60 trillion.

What I'm trying to say with all of this is that the US welfare state, or the notion of politicians dishing out handouts in exchange for votes, is soon coming to an end. Social security, Medicare and many other government spending programs will be cut in the coming years. Regardless of your feelings regarding these programs, they are not funded and with tax receipts falling (and will fall further as the Depression deepens) the US will simply not have the money to pay for these programs.

We will also see the US defaulting on its debts with some kind of debt restructuring included. This is absolutely guaranteed to happen. And THAT is the item of most import for the US financial system.

The reason for this is that the entire financial system is based on the ratings of specific securities with US Treasuries as the highest rated AAA. So if US debt takes a downgrade this will result in systemic volatility on a mass scale.

For one thing pension funds, investment funds, and other entities that are required to only invest in AAA-rated securities will have to move out of Treasuries when this happens.

On top of this, US banks will undergo another Crisis based on the fact that Treasuries are the senior most assets on their balance sheets. What happens when the bedrock of their balance sheets drops dramatically in value forcing system wide margin calls?

KA-BOOM!

Comment:

Comrades, on the one hand, I say, the Judeo-Capitalist system seems to be self-destructing. Good riddance!

However, something about things just doesn't sit right. No matter what Mr. Summers thinks, SOMEONE is always profiting from the misfortunes of others. So no matter how bad things get, no matter how many people lose their money, you can bet your boots that somebody is making an obscene profit somewhere.

What I'm getting at is that perhaps things have been manipulated to the point of disaster deliberately. Just to make a profit? Maybe. But maybe there's more to it.

I don't want to sound like those conspiracy kooks, like Dale Gribble from "King Of The Hill", but if things fall apart completely, something will take it's place. Just what, I don't know. Perhaps a replacement is already waiting to go.

That's why we must be ready as well. Comrades, we must keep up our work. Distribute those fliers/cards/stickers. Keep sending in those pledges. Talk to people. Attend our conferences. And next year, run for office. Our political advisory board is ready and willing to help you with all the details you'll need to run for office.

"If not us, who? If not now, when?" - President Ronald Reagan.

The US Banks Are Going to Take a BIG Hit

By Graham Summers

The situation in the US Congress marks a new low for politics in this country. I'm not going to bother going into details related to the various plans that have been proposed because all of them fail to be relevant.

What I mean by this is that all of the various cuts ($1 trillion or so over however many years) are in fact irrelevant given the fact that the US is running deficits north of $1.5 trillion PER year already.

As for the debt ceiling, whether we raise it or not is also irrelevant in the grand scheme of things. The US is broke and has been for a long time now. There is absolutely no way we will ever pay back our debts which now stand at $44K per man woman and child in the US.

This of course fails to include social security, Medicare and other unfunded liabilities which put the US debt levels closer to $60 trillion.

What I'm trying to say with all of this is that the US welfare state, or the notion of politicians dishing out handouts in exchange for votes, is soon coming to an end. Social security, Medicare and many other government spending programs will be cut in the coming years. Regardless of your feelings regarding these programs, they are not funded and with tax receipts falling (and will fall further as the Depression deepens) the US will simply not have the money to pay for these programs.

We will also see the US defaulting on its debts with some kind of debt restructuring included. This is absolutely guaranteed to happen. And THAT is the item of most import for the US financial system.

The reason for this is that the entire financial system is based on the ratings of specific securities with US Treasuries as the highest rated AAA. So if US debt takes a downgrade this will result in systemic volatility on a mass scale.

For one thing pension funds, investment funds, and other entities that are required to only invest in AAA-rated securities will have to move out of Treasuries when this happens.

On top of this, US banks will undergo another Crisis based on the fact that Treasuries are the senior most assets on their balance sheets. What happens when the bedrock of their balance sheets drops dramatically in value forcing system wide margin calls?

KA-BOOM!

Comment:

Comrades, on the one hand, I say, the Judeo-Capitalist system seems to be self-destructing. Good riddance!

However, something about things just doesn't sit right. No matter what Mr. Summers thinks, SOMEONE is always profiting from the misfortunes of others. So no matter how bad things get, no matter how many people lose their money, you can bet your boots that somebody is making an obscene profit somewhere.

What I'm getting at is that perhaps things have been manipulated to the point of disaster deliberately. Just to make a profit? Maybe. But maybe there's more to it.

I don't want to sound like those conspiracy kooks, like Dale Gribble from "King Of The Hill", but if things fall apart completely, something will take it's place. Just what, I don't know. Perhaps a replacement is already waiting to go.

That's why we must be ready as well. Comrades, we must keep up our work. Distribute those fliers/cards/stickers. Keep sending in those pledges. Talk to people. Attend our conferences. And next year, run for office. Our political advisory board is ready and willing to help you with all the details you'll need to run for office.

"If not us, who? If not now, when?" - President Ronald Reagan.