many global statements on the global ills that plague us
I have read for 100's of hours on economy, financial world, currencies in recent months
I have concluded that the 1990's were largely a fraud
the Federal Reserve sold 40-50% of our nation's gold secretly
it still shows up on the books as gold on shelves, a true Enron accounting scheme
they lent it to JPMorgan and gold miner firms, who sold it
the result was that for 10 years gold sales subsidized USTBonds
central question must be answered:
for 10 years federal deficits occurred, peaking in 1991 at $1000 billion
for 10 years trade gap widened, now at over $400 billion annually
yet somehow interest rates dropped steadily after 1994
yet somehow inflation rates dropped steadily for most of the decade
yet somehow the USdollar strengthened by 50% versus JYen and DMark thru the decade
how did that happen?????????
the answer probably has to do with gold sales subsidizing Treasury Bonds
it was a colossal Robt Rubin fraud
I have watched the dollar decline exactly as I expected since February
I have watched gold rise exactly as I expected since late March
the falling dollar carries with it 20 serious effects, and only about 1-2 of them are positive
fast falling dollar leads to big airpockets, illiquidity, and mild panic, as seen recently
steady falling dollar leads to gradual unleashing of a new decade of price inflation
meanwhile, the USGovt has led us to believe that Fed money printing is a good thing
they have transformed the name of it into "beneficial liquidity"
economics textbooks call it "monetary inflation", laying seeds for future price inflation
but first we must endure a long and painful debt liquidation
with it comes deflationary pressures which will offset the inflationary forces doled out by the Fed with money printing
since Jan2001 the Fed has printed more new money than even existed in 1965
we are witnessing a redux of 1930 Great Depression now
absolutely zero similarity between today's recession and all recessions since WW2
this is based upon overcapacity, excess products, bankruptcies, debt failure, price deflation
every single safe haven will be attacked
in the spring I claimed the Dow/S&P would be next
and next year would be real estate, which will push US into recession
with real estate will go all manner of consumer spending
GreenFuck maneuvered the bubble from stocks to real estate
at Christmas I told all my friends that the dollar would devalue markedly
that the major stock indexes would come down by 30-35% by summer
I expect US$ will devalue by at least 25-30% from its top
it has already declined 12%, altho the lying press calls it only 2-3%
I expect we will see renewed price inflation
this comes from our economy's heavy reliance upon foreign finished products and components
few in the press are discussing renewed price inflation
I believe we will see rising interest rates soon, without strengthening economy
I believe the last two safe havens attacked will be the Dow stocks, and real estate
during a long liquidation like this, nothing is spared
I expect at least 10% of the American households to declare bankruptcy in the next few years
in May alone the individual bankruptcy total was 360,000
already I have noted at least 3-4 bk's touching my life, not from investor friends
be careful with your pension funds, y'all
the most clear and definite and dangerous chart pattern is evident now with the Dow and S&P
it points to a 40-50% decline in the next 18 months
all kinds of experts have pointed this out, and I have been watching it unfold for months
I expect America's Strong Dollar policy to totally backfire
it was great during the upside
but it created large imbalances, e.g.
sent 60% of our mfg base to Asia and Mexico
created a trade gap of over $400B/yr which is approaching critical 5% of US GDP
resulted in 40% of the US Treasury debt to be held by foreigners
the resolution of the strong dollar policy will be massive bankruptcies, eventually price inflation from imports, and low pressure zones in the capital markets for both stocks and bonds
nothing that Greenspam has done so far has resulted in much economic response
three important measures are now distorted, by political motivation
the CPI now is used for COLA in many pensions and socsec incomes
but CPI has ignored property tax, insurance cost, town services, entertainment
it is believed to be low by 30-50%, as stated by professional statisticians
the Productivity numbers are now factoring in three distortions, making things look good
they use strange multipliers for computer power, bandwidth transactions, and drug product size
none of them have anything to do with productivity
a study by strong pro's indicates that outside computerdom, Productivity since 1975 is about 1.9% annually, no more
now recently Unemployment figures have deleted the sensitive transportation industry
apparently airlines, trains, auto rental businesses hurt the numbers too much
the USGovt has become a prime distorter of econ data
most economists are whores, with their work bought and paid for
if/when results do not suit the buyer, then economists are not rehired next time
economists have been reduced to political cheerleaders
I honestly think the 1990's saw the last available buyers of stocks enter the markets
90% of them dont know anything about anything with companies, products, trends, margins, competition, R&D, valuation, history of cycles
so we saw a bubble form, burst, now an economic bust
most of these people have stayed the course
only to be prime candidates for holding onto their stocks during the next tough phase
the falling dollar has led to enormous pressure on stocks
Greenspasm cannot raise rates
if he raises, then corporate profits disappear, since over 75% have swapped longterm debt for interest-rate sensitive shorterm debt, and will get hurt bigtime from rising rates
if he raises, then stock market high valuation will be revealed, corrected, and indexes fall
if he lowers rates to stimulate the economy more, then the dollar gets crushed badly
I have never seen GreenScum so powerless
his 11 rate cuts have done little to stimulate anything
protect yourself
I expect even bonds will get hurt soon
round #1 saw foreigners sell US stocks
round #2 will probably see foreigners sell US bonds
I expect the dollar, stocks, and bonds might be hurt at the same time soon
that means higher prices, higher interest rates, higher mortgage rates, more unemployment, falling stock prices, and the final pillar to fall -- real estate
for a nice puzzle, try this
examine the DowJones Utility index
finance.yahoo.com^NNA&d=c&t=1y&l=on&z=b&q=l
down today a whopping 4.5% after a down day yesterday
down over 35% in the last 12 months
why, in a declining interest rate environment, is DJU falling?
because we are now in the grip of debt collapse
it could take down the entire US economy !!!
hang onto your nuts, or else they soon will disappear too
/ jim |
