# The Ultimate Destruction of the US Dollar and World Markets Will Not Happen



## konkon (26 March 2011)

This is pretty much in response to Damon Vickers' 15 day devastation scenario on world markets, triggered by China not buying US bonds which subsequently collapses the US dollar. He claims the Dow will even drop around 3,000 points in a single day, and there will be carnage in all types of markets around the world. He also claims the Fed will be forced to increase interest rates by up to 6% in a day, to desperately entice investment in the US. The net result from all this devastation will be a creation of a single world currency by a unified world order. 

The following is from http://www.wealthbuildingcourse.com/world-order-weeks-dollar-crashes.html

"This begins with a Chinese choice to not buy any more U.S. Treasuries. That single day will be the death nail in the dollar’s coffin. Over the next two weeks, events will spin out of control in financial markets the world over....Vickers lays out scenes of chaos and rioting, looting of grocery stores, empty ATM machines, and shootings around the world."

The following is from Glen Beck's segment on the dollar's decline and it's well worth a watch:
http://www.youtube.com/watch?v=mdt2SjG1Bz8

The diagrams are to the point. 

I don't see this scenario playing-out like this. Do you? Pressure is definitely mounting on the Fed to further protect the USD. QE3 may be an option mid year. Bill Gross has done an about face by not buying treasuries and this has alarmed many. Vickers is saying the Chinese will be next. Maybe, but this will do more harm to China as it still will peg its currency, the yuan, to the US dollar. If China breaks free form the USD its currency will appreciate so much in such a short amount of time that it will do long term damage to its economy. Even if China pegs the yuan to the euro, it will still appreciate. The Chinese played their hand and used the USD to take advantage of markets and it has to live with this. Vickers doesn't seem to account for this dynamic. He makes it out that China can easily stop buying US bonds. They might but go ahead and see which country benefits the least. This will be more devastating for the Chinese and other Asian countries. 

The US dollar is destined to fall further but I don't see it eventually being replaced by a unified world currency. This is something all governments would want to avoid especially the US government (military etc too). A unified currency for the world just won't work. It will eliminate the necessary (competitive) dynamics that all countries need to function. 

There's nothing intrinsically wrong with any type of currency, like the USD, itself. The practices associated with lending, trading, speculating etc are the problem. A single world currency won't 'fix' these flawed practices and newer, less predictable (at the outset) problems would surface. 

Vickers talks about debt resets which is an interesting concept, but can still work with the set of world currencies we have today. 

Just look at Europe with the euro. Countries like Greece and Ireland have lost their freedom to print money in times of trouble and have gone to the European Central Bank for loans. The EU setup has made the ECB a big bank that will lend money to countries that were destined to go to it for loans. This was bound to happen and it did! 

A creation of a central world currency will dish-out pretty much the same headaches for countries, because you will eventually have a (new) world order operating as a big bank to nations. How many people want this to happen? Give me the system we have and let's go after those that want to destroy this free market system, even with all it's imperfections. 


Here is Damon Vickers' video on his theory, but the Glen Beck one above is excellent:
http://www.damonvickers.com/TheDollarCrash


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## jbocker (27 March 2011)

I reckon if i sat down to a dinner conversation with Damon, i would have slit my own throat by about half way through the main course.

i wont be buying his book, might wait for the movie, reckon Bruce Willis will be the star saviour, if there _is _anyway we can be saved.


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## springhill (27 March 2011)

konkon said:


> Vickers lays out scenes of chaos and rioting, looting of grocery stores, empty ATM machines, and shootings around the world."




How does that differ from what is happening in the world today? Common occurences on the nightly news.

You forgot Jupiter crashing into earth, human males' reproductive organs falling off and women becoming asexual, Jason Voorhees, Mike Myers, Freddy Kruger and the Boogeyman teaming up to form a NWO, plus all vegetation dying out causing herbivores to start eat humans hence us dropping to the bottom of the food chain.

Not in my lifetime.


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## konkon (27 March 2011)

I think that there is a motive to reset all asset classes into some 'organization's' control. Not like the communists tried over the last century. It's more like the way the European Central Bank 'controls' the money supply and destiny of the EU countries. But worse! 

One of the alarming comments made by Vickers is that there is a new world order behind this. 'They' have often sought a single world currency throughout history, one that they can control. I still think it won't happen. But if there is a 'conspiracy' to destroy the USD (and world currencies, markets etc) then it really is up to our best enforcement agencies (not necessarily law enforcing agencies!) to put a stop to this, before this so called new world order has their way. Imagine every one and every country having to go to these 'mobsters' for loans. So no country will be able to print its own currency, like Ireland and Greece for example, and will forever be indebted to a faceless few, that ultimately controls the money supply, interest rates and the intricate dynamics of the capitalist system! I wonder how the military and other higher-end law enforcement agencies feel about this potential move to strip them of their power and freedom? How do governments feel about this?

This secretive organization won't, I believe, succeed in establishing a world currency, but instead, they will (unintentionally or intentionally) set to destroy the fabric and structure of all known and current world markets (asset classes etc) by pushing for the USD's collapse. Don't forget that pretty much everything can (and is) priced in US dollars. If they get their way then the GFC of 2008 will end up like the Queens Tournament before Wimbledon.


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## konkon (27 March 2011)

springhill said:


> How does that differ from what is happening in the world today? Common occurences on the nightly news.
> 
> You forgot Jupiter crashing into earth, human males' reproductive organs falling off and women becoming asexual, Jason Voorhees, Mike Myers, Freddy Kruger and the Boogeyman teaming up to form a NWO, plus all vegetation dying out causing herbivores to start eat humans hence us dropping to the bottom of the food chain.
> 
> Not in my lifetime.




I don't think you understand what it means for world markets (not just stock markets) if the US dollar does collapse. I don't think it will, but if there is an attempt to destroy the USD then it will have catastrophic consequences for all asset classes all over the world. Much more serious wars could break-out overnight. Printing more money, that saved us this time, will be meaningless as currencies will be worth nothing but the paper/plastic its printed on. 

Those that are predicting the US dollars destruction have made money shorting all types of markets way before anyone realised what was happening during the GFC. They are ready to take-on a similar bet in the future and just the magnitude and volumes of 'money' they will outlay to short markets, currencies etc will move these markets to the downside. They were responsible for the heavy momentum short selling that triggered serious and bankrupting margin calls during the GFC. They have stated that they will do it again. 

At the end of the day, the US dollar is just another market or asset class that can easily be targeted. Jupiter of course won't slam into Earth and although a mate of mine looks like Freddy Kruger, the latter won't haunt me in my dreams tonight. There are many investment 'wall street' gurus that are stating that the US dollar is deliberately being targeted. I think we need to listen to them. The same people were on the other side of the GFC trade and made billions.

Short sellers have a direct motive and whether or not a stock, currency, country etc comes out of the carnage still intact is not that important to them. So the US dollar's ultimate decline as a MOTIVE (and even if this doesn't happen) will have dire consequences for us all.


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## konkon (28 March 2011)

The US dollar is tied into nearly all asset classes around the world, to some extent. Its 'destruction' or even possible destruction will to some extent rip through these asset classes. 

Is this the plan by those that want to establish another reserve currency or seek to debunk the USD? The US dollars' collapse might (will, I think) cause all kinds of problems around the globe. 

And at the end of this possible carnage we have another 'little' problem: The ones that own your debt end up owning you


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## tothemax6 (28 March 2011)

People seem to forget that the world has already had a world currency before.


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## konkon (28 March 2011)

tothemax6 said:


> People seem to forget that the world has already had a world currency before.




But these times are different. The world needs the US dollar as the reserve currency or things will begin to unwind. 

The question is, who will control this alternative currency? How does Asia in general deal with the change, when several countries in that region 'peg' their currency to the USD? Do they run the risk of their own markets (not China's) collapsing to some extent? 

A so called world currency might appear stable, but will easily be manipulated to suit needs. A zero-sum-gain theory means that some will lose and some will win at 't'.  

My guess is if the USD is replaced it will be done much quicker than markets can handle. Asia will suffer the most as their reliance on the USD will cause another type of asia crisis (different to the last one).


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## Tanaka (28 March 2011)

konkon said:


> But these times are different. The world needs the US dollar as the reserve currency or things will begin to unwind.
> 
> The question is, who will control this alternative currency? How does Asia in general deal with the change, when several countries in that region 'peg' their currency to the USD? Do they run the risk of their own markets (not China's) collapsing to some extent?
> 
> ...




I can see it happening. China continues to peg its currency to the U.S, builds its nation to the point that it's the worlds biggest by GDP and its wealth is more evenly distributed.  At this point the internal economy is fit enough to weather falls in exports, and then bang! floats its currency. World domination overnight. I don’t expect this to happen in the near future but is possible near the end of my lifetime. Strategically I think this is where China is heading, and good on them.  They had the foresight to see the stupidity in the currency markets.


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## konkon (28 March 2011)

Tanaka said:


> I can see it happening. China continues to peg its currency to the U.S, builds its nation to the point that it's the worlds biggest by GDP and its wealth is more evenly distributed.  At this point the internal economy is fit enough to weather falls in exports, and then bang! floats its currency. World domination overnight. I don’t expect this to happen in the near future but is possible near the end of my lifetime. Strategically I think this is where China is heading, and good on them.  They had the foresight to see the stupidity in the currency markets.




If China floats its currency, then it will appreciate to the point of killing its export market; its products will be too expensive for the west and the rest of the world. This will happen anytime within our lifetimes. The Chinese know this. I believe the Chinese economy will have a greater net wealth than any country on earth (but will NOT be the most economically superior one!), but will go the way of Japan with a stronger currency over time. This pretty much screwed Japan in the late 80s and 90s and its fate was manipulated by the west (mainly the US). 

I agree there is stupidity in the currency markets, but China stands to lose-out pretty badly too. In fact, all of Asia does. 

The Asian countries ended up pegging their currencies to the US dollar after the Asia crisis, to protect their currencies and economies. But now they are kind-of stuck in an undesirable place and will suffer badly if there is a run on the US dollar, like many are predicting. 

China is in trouble (in the long run) and here's one reason why: If China keeps buying US treasuries/dollars then the US dollar will drag the (pegged) yuan down. But this is a problem when China's +10% growth means the yuan should be going the other way - up! And at around 5% per year, at least. So there is a spread in the dynamics in China, which pretty much means high inflation down the track. Which means interest rates there should be going up much higher and faster than what is happening right now. Problems down the track. 

Now look at an alternative. If China stops buying US treasuries/dollars, like many are predicting, then there will be a run on the US dollar. It may collapse, which would create volatility in markets around the world, kind of like we saw in October of 2008. Vickers said that China not buying US bonds will trigger a meltdown, far worse than 2008. He was shorting and making money back then and knows what he is talking about. It's a question of whether China stops buying US bonds. 

Either scenario is problematic for China. Where did it all go wrong? I think I know, I'm just being dramatic. 

So much for the zero-sum-gain theory. Who wins in either scenario?


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## Tanaka (28 March 2011)

konkon said:


> If China floats its currency, then it will appreciate to the point of killing its export market; its products will be too expensive for the west and the rest of the world...




You're preaching to the converted. But my point was that if you can turn your economy into an internally functioning economy then there is room for bad exports, especially when you concider by the time this happens the world is going to be mostly Chinese  

There are great similatities with the Chinese story that have already happened to the Japanese, but I'm concidering that the Chinese population is so much bigger than Japan's that I'd expect thing to blow out bigger but take longer to blow out, hence I don't see it happening anytime soon.

Just my thoughts on the matter, economics ain't my strong point.


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## konkon (28 March 2011)

Tanaka said:


> You're preaching to the converted. But my point was that if you can turn your economy into an internally functioning economy then there is room for bad exports, especially when you concider by the time this happens the world is going to be mostly Chinese
> 
> There are great similatities with the Chinese story that have already happened to the Japanese, but I'm concidering that the Chinese population is so much bigger than Japan's that I'd expect thing to blow out bigger but take longer to blow out, hence I don't see it happening anytime soon.
> 
> Just my thoughts on the matter, economics ain't my strong point.




You make some very strong points. China can't have it this good for too long. They still don't know how the capitalist system works and this will forever be a problem. I can't see China adopting the capitalist model. 

Another problem will be this and the next generation onwards having to foot the bill for an aging demographic. What would the ratio look like; 1 elderly person being supported by 4? This will put a strain on their economy too, especially when costs in China will continue to escalate. Japan would have been pretty cheap in the 1960s too, but it only took them a further 20 years to end up the most expensive country to live in on Earth. China's cost of living will have moments of it skyrocketing, like it did in Japan. The west will make sure of this. 

The Chinese are a very clever race too.


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## tothemax6 (28 March 2011)

konkon said:


> The Chinese are a very clever race too.



I would hesitate to call the Chinese a race, or even a nation for that matter. Given its linguistic, ethnic, and perhaps even national diversity, it is at most a state. However, yes China averages a higher than average IQ, however if this has a genetic basis (and to a large extent it does), one should be reminded that its level is thus fairly constant - but China's prowess has not been. Hence there is more to success than IQ.


Tanaka said:


> I can see it happening. China continues to peg its currency to the U.S, builds its nation to the point that it's the worlds biggest by GDP and its wealth is more evenly distributed.  At this point the internal economy is fit enough to weather falls in exports, and then bang! floats its currency. World domination overnight. I don’t expect this to happen in the near future but is possible near the end of my lifetime. Strategically I think this is where China is heading, and good on them.  They had the foresight to see the stupidity in the currency markets.



To respond to both of you, I have a different scenario: China is a nation of industrious men, this is clear. They have many intelligent men, this is true. But so too is and was this this case in Japan, leading up to its crash. A nation can be as industrious as it wants, but if there are large market distortions, and in China there are, that industry and intelligence may not be aimed in the right and natural direction.

So here is my scenario: China is in the midst of a crack-up boom fueled by credit expansion. They have negative real interest rates. Their 'GDP' is to a large extent comprised of steel, concrete, and sweat going into building buildings for which there will be no occupants. They have piles of empty condos held by the owners as 'investments'. They have empty cities. The claims that these vacancies will be filled fail to see that there is more office and house space than even the Chinese can fill, and that few Chinese can afford the elevated prices. The so called Chinese export prowess misses the point that this export is not a legitimate part of the economy - since due to the currency peg any profits from the export simply accumulate as piles of foreign bonds on the floor of the PBoC. Hence the export itself is a huge market distortion created by the central bank.
China crashes, and it crashes hard. The world then worries about the next nation that will 'take over the world'. 
We will see...


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## konkon (28 March 2011)

tothemax6 said:


> So here is my scenario: China is in the midst of a crack-up boom fueled by credit expansion. They have negative real interest rates. Their 'GDP' is to a large extent comprised of steel, concrete, and sweat going into building buildings for which there will be no occupants. They have piles of empty condos held by the owners as 'investments'. They have empty cities. The claims that these vacancies will be filled fail to see that there is more office and house space than even the Chinese can fill, and that few Chinese can afford the elevated prices. The so called Chinese export prowess misses the point that this export is not a legitimate part of the economy - since due to the currency peg any profits from the export simply accumulate as piles of foreign bonds on the floor of the PBoC. Hence the export itself is a huge market distortion created by the central bank.
> China crashes, and it crashes hard. The world then worries about the next nation that will 'take over the world'.
> We will see...




Interesting post. Some insight into an enigma of an economy and a nation. The west is fed a different picture of how things function in China.


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## konkon (29 March 2011)

I've been reading up on the possible demise of the US dollar and have viewed many Youtube documentaries (many of which are quite good) on the future of the American currency and its impact on global markets. I have also discussed this with many people here and I'm surprised many don't see its potential downfall as an issue. What am I missing? 

I still believe the USD will firm up in a few years and the Fed may have to, by default, increase interest rates in the US. But it will fall further over the next year, I guess. That might depend on whether the Fed in the US stops the quantitative easing. If it does, then the US dollar might drop even further. Maybe. Quite difficult to predict, but very important to know. Is it going to continue to fall no matter what the Fed does? The Fed may just slow the process down. 

When the Fed does stop its quantitative easing, there will be more volatility on the markets. You can be sure of this. The VIX will rise and fall with greater frequency and momentum. Quantitative easing has soften the VIX at the moment. 

I guess people just feel like the USD is a lot more isolated than what I think; I believe it's tied to every single asset class to some extent. Like a widespread rising tide in the middle of the ocean, it can be easily overlooked. All those asset classes around the world (and here) will be rising and then potentially falling and we just won't know it being in the position and location that we're in. If we're not sure of not just the current state of the US dollar, but of its future, then we might find it difficult to put a value (or future value) on a certain type of asset. 

Our point of reference might be beyond the horizon, so this may give us a false sense of security. 

Some of the feedback I'm getting is 'yes, the US dollar is finished, and that's that'. But I worry too much that it's not just that.


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## konkon (29 March 2011)

There are too many committed markets, investment models and asset classes etc holding up the USD. Pressure is definitely building on this world currency to devalue even further, but all of these commitments are too interwoven into the very fabric that makes the USD function. All of the examples of hyperinflation and currency destruction that has occurred around the world over the last century have one thing in common; they are not the world's reserve currency. There is a different dynamic at play with the USD. The attempted transfer from the use of the USD to another currency or newly created currency, as the reserve currency, will have lots of latent and sometimes direct opposition. This could even come in the form of a battle, and not just in the electronic and market world! A long shot down the track, perhaps and hopefully for everyone's sake it remains a long shot.

But the battle could likely be fought in the electronic market world, where a new reserve currency gets manipulated (becomes expensive, perhaps) to, for example, screw the export markets of the countries that host and use that currency. Would China, for example, really want to rely on an expensive currency to sell its exports overseas?

There is nothing intrinsically wrong with the USD, and the fact that it ended up, perhaps, manipulated over the years means that the same fate could be bestowed on a potential next reserve currency of the world.

I guess in theory the world could establish a kind of electronic crediting system currency, like you would have in the old Space Invaders Game, where all players play by the same or similar rules and use the same crediting system (to keep ahead of the Joneses!). But the 'free' markets are chaotic in nature, perhaps because they follow the same 2nd law of thermodynamics like we all do, in which it's near impossible to make a system become more organized over time. Therefore, you couldn't get all countries, for example, to adopt a universal crediting system or single (only one) world currency. So what you're left with is a currency just like the USD. So why change?


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## tothemax6 (30 March 2011)

Konkon, I don't follow you.

The world _already_ used to have a global currency - gold. And it worked pretty damn well. 

The value of the USD is a function of how much USD exists, and the demand for USD. The latter is determined by foreign demand for US products versus the US demand for foreign products. The former is determined by the size of the monetary base (created the Fed) and the aggregate amount of credit extended against this monetary base (created by banks etc) - which is itself a function of the size of the monetary base. 

The use of the USD as a 'reserve currency' will largely rest on its value as a currency. Thus whether or not the USD retains its position as the favoured currency in finance, commodity pricing etc, depends only on:
Is the purchasing power of the USD increasing, decreasing, or staying constant.

If the USD turns to garbage, people will not use it. They will use something better.


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## konkon (31 March 2011)

tothemax6 said:


> Konkon, I don't follow you.
> 
> The world _already_ used to have a global currency - gold. And it worked pretty damn well.
> 
> ...




I can't see a finite product like gold being good in the long run or good in general. Speculators would just increase its value and distortions in markets would result. Even using it as a gold standard would restrict lending practices and heat-up economies. Imaging fighting for credit these days. What would interest rates end up as? People weren't as money savvy or greedy as they are today and so, you have a different dynamic to deal with. Using gold as a gold standard or itself would prop-up other commodity prices too; "If gold's more valuable today, then why shouldn't a similar commodity like silver, and a similar one to that..." This could end up being the underlying logic. 

I agree if the US dollar does turn to garbage, then hardly anyone would want to use it. But I don't think it will eventually turn to garbage. Do people and markets really believe the US dollar will turn to garbage? If so, then why isn't there a run on the US dollar? Markets are, after all, about placing future bets. Where is this bet? The dollars decline in the last decade? It needed to decline eventually. 

The explanation you gave is excellent and to the point. But this is pretty much an explanation about nearly any currency. It obviously does include the US dollar, but being the reserve modern-day world currency the US dollar does have special privileges that have been assigned to it. As mentioned before, "There are too many committed markets, investment models and asset classes etc holding up the USD." The US dollar is interconnected with several major asset classes. There will always be support for the US dollar as long as the US keeps controlling the world markets, the money supply and keeps its status as the number one military force, which it will. The supply and demand dynamic is just one side of this argument. There are many latent forces which makes the US dollar the world's reserve currency.

I think that a modern day dynamic that has to go hand in hand is: you won't have the number one military force if your currency is not the world's reserve currency. Sure logically the two don't have to be united in the way stated, and I'm well aware of this. But I think that the two must go together considering the times we live in. The US will not give up its number one military status. Period. It needs to have the most widely used and influential currency too. The two dynamics reinforce each other to some extent. And they will support one another in the long run. 

I did like your post too.


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## konkon (8 April 2011)

I think we need to bring in all kinds of factors into the equation, even though the US would be scoring a very low score on its overall economy, if you were to isolate the economy from all other variables. But in the real world, you can't.

The US along with Germany and the UK controls the future of trading: with sophisticated and intelligent computers that do around 70%+ of major trades. This is what ultimately will continue to give the United States the edge on the rest of the world. Do you really think the US will allow China etc to take charge here? No chance. It won't happen, no matter how wealthy the Chinese become. I'm not talking about GDP vs GDP here or some other economic dynamic. I'm talking about who will always be the ultimate *economic gate-keeper*, and yes, the US will still be in charge here even if its wealth is half that of China's in the foreseeable future. 

As a last resort, if the US had to restructure its currency and/or default on outstanding debts it would do so, but not in the traditional sense, that would ultimately harm them the most. No, the United States will find ways to restructure its economy (and it might not and most likely won't be pretty!). 

Initially, it would look like the United States is losing while some emerging countries have gained ground, overnight. But, most countries stand to lose more from a sophisticated restructuring event, than the US. Economists will tell you to look at the text books for reasons why the US will suffer the most. But these economists and text books can't see the overall picture and (*not just economic*) reasons why other countries will stand to lose the most. For example, when does the might and influence of the United States military factor into some macro economic (text book or economist's) reasoning? Hardly ever, because they don't see it as a major historical influence in United States' economic success. *Text books will strip-out all of these necessary 'bits' and discuss economic dynamics in isolation*, and even treat the United States as another potential eg. Yugoslavia without realizing that there's so much more to the United States economy than just its economy.

Well, for starters, non US countries might not get paid and their old US treasuries would be worth nothing. So what do these countries do to retaliate? Not use new US treasuries and not have the the new USD as a reserve currency or just trade amongst themselves and leave out the US? Really? What if they're given little choice but to (eventually) adopt this new currency and the new system, still run by the United States? Do you really believe that countries can just trade amongst themselves without being *'entrapped' into the economic matrix that the United States set up and would still control? *

I think that people underestimate the sophisticated nature of the higher-end United States in general, and the influence it's had on the longevity of the United States economy. Sorry, and I don't mean to offend, but the US didn't just get to where it is (was) from just back-breaking hard work! Plenty of countries have and are doing this and this alone has got them nowhere. Once again, I don't mean to offend (after all, I'm just an average guy going to work too). I am talking about (historically) macro-focused higher-end groups that set to control different aspects of the world, directly or (mainly) indirectly, by establishing, maintaining and controlling the set of systems or matrix that underlies the very structure of perhaps all asset classes, worldwide. And they are still at it, even though they don't and can't advertise this.

The US will eventually hike rates, even by default. Along with a clever restructuring program that's implemented gradually, they will stimulate their own domestic economy. But the US doesn't have to and won't pay its bills in full. Who really stands to lose here, if you take into account what I stated above and not respond to this in isolation.

I don't see the US as the big losers here if they slowly and cleverly restructure their economy and if it doesn't end up paying its bills in full; which it won't do.

So does the US have to 'play fair' (whatever that means!)? Why should it when countries have piggy-backed on all of the United States' risk taking over the last decade plus. Pegging your own currency to gain advantages in various markets is an example of this.


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## dhukka (8 April 2011)

konkon said:


> This is pretty much in response to Damon Vickers' 15 day devastation scenario on world markets, triggered by China not buying US bonds which subsequently collapses the US dollar. He claims the Dow will even drop around 3,000 points in a single day, and there will be carnage in all types of markets around the world. He also claims the Fed will be forced to increase interest rates by up to 6% in a day, to desperately entice investment in the US. The net result from all this devastation will be a creation of a single world currency by a unified world order.
> 
> The following is from http://www.wealthbuildingcourse.com/world-order-weeks-dollar-crashes.html
> 
> ...




konkon, if you are going to copy and paste large chunks of text from other sites, wouldn't it be appropriate to provide a link and acknowledge the source?


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## konkon (9 April 2011)

dhukka said:


> konkon, if you are going to copy and paste large chunks of text from other sites, wouldn't it be appropriate to provide a link and acknowledge the source?




This is all my own work. Originally written on 'Notepad' and copied and pasted on this and some other sites.


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## drsmith (9 April 2011)

Some interesting and recent commentary from Marc Faber.

http://www.businessinsider.com/marc-faber-rant-on-illiterate-people-2011-4


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## konkon (9 April 2011)

drsmith said:


> Some interesting and recent commentary from Marc Faber.
> 
> http://www.businessinsider.com/marc-faber-rant-on-illiterate-people-2011-4




Yes, this is an interesting segment. There's probably some truth in the theory that some 'well-off investors' do try at times to get back at the masses.


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## konkon (10 April 2011)

The position of a market at a given time is to a large extent about net gains or losses between a multitude of opposing investment forces. There appears to be a largely one-sided effort to, for example, sell the USD and buy-up commodities, like gold, silver etc. Instead of allowing investors to keep making this largely one-sided trade, why don't those in charge of printing money, and pretty much anyone else (with power) that has a vested interest in saving the USD down the track, tilt the dynamics in their favor by any reasonable (or unreasonable) means necessary to make a fundamental paradigm shift in the pressures that ultimately decide which trade we stick to. So just turn the tables on those that want to keep bumping-up the price of commodities in a year or so, after inflation in those non US economies has played its part.

This has been achieved throughout history at various times and by various methods. Maybe this is a possible option down the track, and anyone long gold, silver etc in a year's time and beyond, might have to watch-out. We have been through this type of trade over and over before throughout history where investors ended up holding overinflated and overpriced commodities for decades even! The justifications were there like they are now. 

*Don't be surprised if the Federal Reserve and the US Government, and other senior interested parties end up turning the tables on this one-sided trade (in the future sometime), and you're all left holding just some overpriced commodity certificates.*


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## konkon (12 April 2011)

The US's ability to influence all markets has not disappeared. They won't do it for a while though. And when it's time for the US economy to strengthen the dollar will begin to appreciate. The price of commodities will decline as they are priced in US dollars. 

The rest of the world stands to lose a fair bit over the next year or more, with high inflation, high interest rates and a lot more volatility when QE2 ceases. A key move will be over the next few months when QE2 begins to be fazed-out. This most probably will send markets on a roller-coaster ride and volatility will be high. QE3 will be needed, but this has become a real political and election issue now and it will have too much opposition. 

Commodities have always gone up and down throughout history; silver in 1980 hit around US$49 (http://www.silverinstitute.org/hist_priceuk.php) and then depreciated. Silver will have to find a ceiling in the distant future, but it could easily go back to under $20 in a few years time, even if it hits around +$60 this time round. In fact, it like other commodities has risen to such heights during Quantitative Easing. It may continue to go higher but it could easily depreciate. *It just won't happen without speculation going the other way. *

There will be a growing number of speculators bullish on the (to some extent, reinvented) US economy, USD etc in the future and their influence will dwarf interest in commodities and most variables, asset classes etc that are inversely related to the USD. 

Bernanke can and just might increase interest rates in even a minute, if the circumstances granted such a move in a year or more. I can foresee a coordinated move by the Fed, US Government, US corporations and other powerful US and US-allied 'associates', to change the dynamics of market sentiment and back a revived US economy, in the future. What happened won't be reversed. A restructuring will occur, and the consequences of such a move will be aimed at favoring the US's economic regrowth, which most likely would mean a stronger USD. So commodity speculators better be prepared down the track, as they won't be able to withstand the onslaught of a resurgence in the United States economy. Just ask those that bought and held gold for decades to try and get their money back! Money just went into other asset classes, during gold's demise, and this will happen again. 

*Speculation in all kinds of markets could easily prop-up prices past 100%* of values if there weren't the very influential 'sales-reps' behind such moves. People have to understand that collusion in markets and market prices is a very big thing and you can be assured that if there is a 'sure-thing' going on, like money being piled onto silver, for example, then you must understand those with hundreds of millions to invest might pile money onto those asset classes. Birds of a feather flock together; so you don't even have to go for silver. Pretty much any soft or hard commodity will do. 

Unfortunately we live in a world where those that latently collude to price-fix end up to some extent (to a large extent in the last few years) sealing our economic fate. Sure it troubles people to hear this but it does go on. Just think of what you could do if you were 'networked' with half a billion to use, and there's hardly anyone to overhear you and your 'partners' colluding to corner markets. While this goes on, the proper authorities are too busy (through no fault of their own) looking the other way. And are our authorities and courts able to look-into, for example, complex derivative contracts and their validity or legality? When 'cloud exchanges' (merger of international exchanges) are up and running, what happens to jurisdiction on such and other complex matters? 

What doesn't help is when organisations like ASIC are stripped of their powers and are downsized.


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## konkon (13 April 2011)

*The increase in salaries gradually is key to a recovery.*

There are many issues the United States can tackle and the orchestration of a commodity (speculation) take-down in the future is just one of several options. Another option would be to adopt an increase in wages policy across the board, but fazed-in gradually. Food will not drop in price. So the US has to match this with higher salaries. Enough of this importation of cheap labor in eg. the hospitality industry. The minimum wage must increase and matched with small and reasonable periodic increments. 

The US has to get more proactive, offensive and much less defensive. If you increase wages across the board then housing will become more affordable. Sure there will be opposition from large corporations and employers because of lower profit margins. But take the fight to them! No one will allow these sort of changes without a fight (not in the physical sense, of course). I think that a more proactive potential US President (or even Obama himself) with a higher wages policy, starting with addressing the minimum wage, will win the support of the people. This is the fight big corporations cannot compete with! The electorate most probably will vote this guy (or gal) in even with all the opposition from big-business. Big-business had a hand in the financial crisis and this is a compromise to compensate, and restrengthen the US economy. If you expect the US consumer to help 'fix' the economic problems, then pay them more!

If your printing record volumes of money, then make it worth while. Channel a large portion to growth and regrowth areas that will reinvest in the US economy. For example, if the minimum wage (especially in the private sector) increased an initial amount of 20% and then increments of 5% every year for three years to start off with, then you would enable those who never could buy into the housing market to purchase a property, with all the strict regulatory requirements, of course.]

*Higher wages, will bring inflation, but you're going to get this anyway.* Higher wages will mean more tax revenue to continue paying for all those important public service jobs. They're also going to be paying tax too. So you're addressing the domestic debt issue to some extent. Every bit helps. Never underestimate the growth potential from a confident US consumer that's back in his/her own house and is paying their bills and is investing in more ways than one for the future.

As for (a largely narrow-minded) big-business (large corporations etc) that will oppose such a move, can you imagine how much revenue you will eventually receive from a prosperous US consumer that can consistently pay its bills?

If the US doesn't increase salaries across the board, then they won't be able to keep up with higher national and state debts, higher costs for food, energy etc and higher inflation. All those nasties that have to be matched with higher wages.

Don't forget that higher US wages and higher interest rates in the US down the track means lower commodity prices in the US, as they are priced in US dollars. The best thing is it will take the commodity speculators out of the market. There may not be as much inflation as you think. Inflation with real and strong growth is better than inflation with negative growth (what the US is going through now).


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## konkon (21 April 2011)

The run-up in commodity prices this year is alarming. The pressure on other asset classes must be quite high. Last night's trade on Wall Street was a little alarming and a sign of things to come. At least two things surprised me. One being the heavy selling of USDs overnight and another (serious) move was the buying of stocks around the world, as if the USD's move down is in some vacuum and it shouldn't impact other asset classes. 

I think that in the months to come, and most likely next year, the heavy selling of USDs in a session will bring markets down with it. 

The commentary on finance channels was over-optimistic, I think. Are they oblivious to what a serious correction of the USD might do to stocks or am I missing something? 

I also see North Melbourne beating Richmond with ease and made the most of the generous odds. Am I missing something here too?


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## bandicoot76 (21 April 2011)

hi konkon,
you raise some really interesting points on this thread and i really enjoyed reading your (and others) posts on the issue,

with regards to your(?) view that there may be a cabal of extremely wealthy individuals deliberately manipulating world markets, currencies, commodities etc (the elusive NWO as some call it) 
well recently i found this gem of an animated doco on youtube aimed at educating the 'laymen' about how things really work behind the scenes in the global financial world... 

http://www.youtube.com/watch?v=tGk5ioEXlIM

while perhaps it may be abit too "americanised" i really enjoyed it and really think it should be made mandatory viewing in all schools! i hope you enjoy it as much as i did! cheers... the bandicoot!


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## explod (21 April 2011)

konkon said:


> The commentary on finance channels was over-optimistic, I think. Are they oblivious to what a serious correction of the USD might do to stocks or am I missing something?
> 
> I also see North Melbourne beating Richmond with ease and made the most of the generous odds. Am I missing something here too?




The overprinting of the US$ is turning it into trash and the US to a banana republic.  How it exactly plays out is anyones guess but it will not be nice on any of us.  Cant' happen, we will see.

Stick with your punt on the football.


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## Boggo (21 April 2011)

America is the only country that went from barbarism to decadence without civilization in between.
_Oscar Wilde_


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## TabJockey (21 April 2011)

konkon said:


> I've been reading up on the possible demise of the US dollar and *have viewed many Youtube documentaries* (many of which are quite good)




This is where you went wrong. Youtube docos are mighty entertaining and that sucks you in to believing thier logically presented facts. Turns out they are not facts, its just a load of rubbish.


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## Uncle Festivus (21 April 2011)

Too late - it's already happening!

What we have to remember is that the other side of the $USD trade is.....everything! If it goes down everything else goes up - MAD - Mutually Assured Destruction! Otherwise known as inflation, and the feeble, behind the curve attempts to stop it (China), or in Bernankes' case, to totally deny it exists? 

Exhibit #1 commodities - combined with stimulis & QE to create artificial global demand ie China GDP figures to order, irrespective of the demand or need for anything in particular?
Closer to home, all of the BER projects have completed or will be completed within the rest of the year. Now combine this with the latest poor, abysmal actually, building starts, both resi & commercial, and you have the foundation for substantial job losses, and possibly interest rate cut's, although the market is pricing in more rises. There is a shadow recession going on around the world but when has the real economy mattered when it comes to the illusion of 'green shoots' & a 'global recovery' that manifests itself in a rising stockmarket?

Exhibit #2 FX - while the RBA sit's on it's collective hands & doesn't intervene in the hollowing out of export & manufacturing we will eventually end up with only 1 money maker - several thousand holes in the ground. Other CB's actively intervene to make their currency competitive for their economies - while our noble boofheads uphold some sort of 'level playing field'!

And when China finally implodes under the weight of it's own QE (now finished & trying to contain rampant inflation) and US Fed QE (ditto) then we will be comprehensively stuffed. The question should be which country will blink first - the US or China, both having a firm grip on each others financial genitals...

The US Fed is now between a rock & a hard place as far as any further ammunition to fight the lost battles in upholding it's 2 (really 3 ie the stock market) mandates. It simply can't afford to raise rates. 

Have a look here, read it a few times to understand why........

Charles Plosser and the 50% Contraction in the Fed’s Balance Sheet 

Exhibit # 3 stock markets - several indications are in place signaling either overbought or extreme levels compared to the fundamentals. Trading on margin is a record - if there is indeed a substantial market sell-off, ie more than just the usual 200 drop, then margin calls will melt the market down, or until the market is halted. Insider sales are still at record & or elevated levels. 

Exhibit # 4 - global debt max-out - the US debt ceiling will be breached in the next few weeks - they have no choice but to raise it and continue the sham. They are technicall y insolvent already!

etcetera etcetera....... the global financial system is just one gigantic Ponzi scheme - last one out turn the lights off....


Physical cash, & more gold after the lemmings have to sell it to fund their margin calls.....


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## Knobby22 (22 April 2011)

I am also worried that as the US turn off the stimulus and contract government spending, they will go back into recession. Major attacks on collective bargaining will further reduce wages, also reducing spending.

The good thing the US has on its side is that exports are taking off. I reckon as long as China holds out, things will be OK but I agree the world is fragile at the moment. Another big shock might tip it over.


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## konkon (22 April 2011)

bandicoot76 said:


> hi konkon,
> you raise some really interesting points on this thread and i really enjoyed reading your (and others) posts on the issue,
> 
> with regards to your(?) view that there may be a cabal of extremely wealthy individuals deliberately manipulating world markets, currencies, commodities etc (the elusive NWO as some call it)
> ...




I am downloading this video and am looking forward to watching it. 

Where there's a void there will be occupation. 

The second law of thermodynamics (which suggests that _things_ will over time _get_ less organised) doesn't really _allow_ for there to be so much 'worldly' and uniformed order in the direction of all types of markets. Those markets are by nature unpredictable and chaotic, but appear to be more orderly and predictable (for now!) considering what took place in 2008 and the increasing perpetual debt issues etc that we all face. I don't like the name New World Order, but this cloud organisation does exist and it was created and is controlled by a shadowy western elite, whose influence and power extends into numerous leadership roles in most countries on Earth; the gatekeepers but not the decision makers. The decisions are left to only a few US and European higher-end members. And yes, I do believe they have an _unfair_ advantage in controlling world asset-classes.

The global financial crisis of 2008, I believe, saw a large part of the so-called NWO and nearly everyone else adversely affected. The repositioning straight after that would have given the world a glimpse of the NWO, as they scrambled to be the first out of the gates to reposition itself. I have my own theories as to who some of the elite members of the NWO are, and I'll just keep this to myself.


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## konkon (22 April 2011)

TabJockey said:


> This is where you went wrong. Youtube docos are mighty entertaining and that sucks you in to believing thier logically presented facts. Turns out they are not facts, its just a load of rubbish.




You need to find something that, at least, begins to make sense to you. The mainstream media doesn't anymore. They use to but most of what is reported in the mainstream media is either or a combination of: spin from the right or left, infotainment, a complete waste of time ('ducks crossing the road' stories on prime-time), stories about blue-collar crime and rarely about serious high-end white collar crime and scams. And the list goes on and on. Some of this is designed to make us all look the other way! So point the finger at the poor sod that's running away with a stolen can of soda, while high-end corporate scams and fraud etc is adversely affecting your future. Their sponsors are no longer going to report this, so it's left up to blogs and visual entries on the internet to help enlighten us further.


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## konkon (22 April 2011)

Knobby22 said:


> I am also worried that as the US turn off the stimulus and contract government spending, they will go back into recession. Major attacks on collective bargaining will further reduce wages, also reducing spending.
> 
> The good thing the US has on its side is that exports are taking off. I reckon as long as China holds out, things will be OK but I agree the world is fragile at the moment. Another big shock might tip it over.




I am also concerned about the end of QE2. Who else will buy US treasuries? A very serious issue and perhaps the biggest one of the year. I think they need the Fed to implement a QE3 or something equivalent to sure-up markets and for someone to help the USD form sinking further. 

I think the US needs to raise the minimum wage by up to 25% with further periodic (yearly) increments of around 5%. Inflation will eventually hit the US regardless. How do you keep up with higher prices all round? With more money especially in the private sector. In fact, the private sector is where it should be done mainly. But this checkered move will not be allowed I'm sure. But the public service is a real burden on the US taxpayer at the moment, not always of course.


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## konkon (22 April 2011)

explod said:


> The overprinting of the US$ is turning it into trash and the US to a banana republic.  How it exactly plays out is anyones guess but it will not be nice on any of us.  Cant' happen, we will see.
> 
> Stick with your punt on the football.




The overprinting of the USD will be an even bigger problem for the rest of the world in the long term, as the US, that still controls the structure of world markets, will restructure their economy and currency to best suit themselves, which could be disastrous for all other creditors and markets. 

At the moment and for the foreseeable future, the US is the biggest (indirect) _exporter_ of inflation to the rest of the world. As the currency devalues even further more and more inflation will hit the rest of the world including themselves, but the US still has a greater purchasing power than most countries and it can withstand more inflation. 

Buying protection like an inverse currency or commodity these days makes sense to a lot of investors, but this itself won't last in the long term as things could drastically change. Probably alright for the next year or more though, as not much will be done before the next US federal election.  

I think that the US's restructuring and rise once again, even if it takes a long time, is a safer bet than North Melbourne beating Richmond.


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## LifeChoices (22 April 2011)

explod said:


> The overprinting of the US$ is turning it into trash and the US to a banana republic.  How it exactly plays out is anyones guess but it will not be nice on any of us.  Cant' happen, we will see.
> 
> Stick with your punt on the football.




I read somewhere if the $US collapses, think of it like John Holmes raping a 10 y.o. 

Ok - found it: http://answers.yahoo.com/question/index?qid=20110302235211AAFvm4b

Here's another perspective of how it could pan out.

http://www.stansberryresearch.com/pro/1103PSIEOAVD/LPSIM3CH/PR

I've got my silver - have you?


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## Smurf1976 (22 April 2011)

It took decades of decline to get to the point the US is at now. That's not going to be reversed overnight, or even within a decade. From a practical perspective, most of the advantages the US once had in its favour have either disappeared or reversed.

It's hard to think that the US was once the world's dominant oil producer and manufacturer with a huge middle class. Today it guzzles through more oil imports than anyone else, sources most goods from overseas and is home to a vast underclass with a small minority holding almost all the wealth. The US in 2011 is virtually the opposite of what it was 40 years earlier. Everything it had in its favour then, is gone or against it now.

I can believe that the US may well be back on top someday. But I can't see it happening anytime soon, at least not in a genuine sense that benefits the majority of ordinary Americans.


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## konkon (22 April 2011)

Smurf1976 said:


> It took decades of decline to get to the point the US is at now. That's not going to be reversed overnight, or even within a decade. From a practical perspective, most of the advantages the US once had in its favour have either disappeared or reversed.
> 
> It's hard to think that the US was once the world's dominant oil producer and manufacturer with a huge middle class. Today it guzzles through more oil imports than anyone else, sources most goods from overseas and is home to a vast underclass with a small minority holding almost all the wealth. The US in 2011 is virtually the opposite of what it was 40 years earlier. Everything it had in its favour then, is gone or against it now.
> 
> I can believe that the US may well be back on top someday. But I can't see it happening anytime soon, at least not in a genuine sense that benefits the majority of ordinary Americans.




A restructuring is in the process. The US Government, Federal Reserve, Treasury, military etc will not allow China or anyone else to steal its thunder. You're right about a transfer of wealth from the middle class to the upper class. This is going on around the world too. But a future restructuring might hand over more wealth to a future middle class, as this is needed to support a healthy and functioning economy.


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## syd430 (22 April 2011)

Yes QE3 is coming, so is QE4, QE5.... 

The US ceased being a creditor nation a long time ago. The only thing holding the US economy (and the dollar) together at this point in time is Bernanke's printing press.  Don't make any mistake about it though, the US is still the same same unproductive country that lost its comparative advantage decades ago. Once a lot of this debt matures (which a lot of it will soon) and its not rolled over (due to the belief amongst creditors that the fed will continue to print money for as long as it can and cause further inflationary pressure), then you can expect a significant devaluation of the dollar.


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## bandicoot76 (22 April 2011)

TabJockey said:


> This is where you went wrong. Youtube docos are mighty entertaining and that sucks you in to believing thier logically presented facts. Turns out they are not facts, its just a load of rubbish.




....as opposed to the crap they feed us via the mainstream media??????????? 

a good quote i heard recently 

"... havnt you heard? its not called the mainstream media anymore its now the 'mushroom media'... keeping us in the dark and feeding us bullsh*t".... yeah i liked that one!  

not all youtube information is reliable for sure, but at least its a way for multiple views on a topic to be expressed UNLIKE the censored,skewed, spun and oh so bias crap that the mainstream media spews forth... 

...but then i keep forgetting that as long as brangelina are still together and kyle keeps playing it fair on idol the world will remain all warm and fuzzy without the possibility of any bad things coming to pass!


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## bandicoot76 (22 April 2011)

konkon said:


> But a future restructuring might hand over more wealth to a future middle class, as this is needed to support a healthy and functioning economy.




lets hope so my friend, but my fear is we are being forced back into a feudal like system of serfdom similar to the medieval 'dark ages', with:

1)a tiny ruling 'elite' class (like the old european aristocracy) owning everything, 
2)no middle class and 
3)a massive poor (peasant) working class controlled by means of financial slavery (by being paid less than their cost of living, therefore being constantly in debt to their 'masters')

i pray to god (no im not overly religious) that this never happens but alot of the signs are there that there is a deliberate war being waged against the middle class/ small business's/family farms etc (a carbon tax being the latest example)! 

i think its about to become a case of 'hope for the best but prepare for the worst!'..... lets hope not though hey!


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## konkon (23 April 2011)

bandicoot76 said:


> lets hope so my friend, but my fear is we are being forced back into a feudal like system of serfdom similar to the medieval 'dark ages', with:
> 
> 1)a tiny ruling 'elite' class (like the old european aristocracy) owning everything,
> 2)no middle class and
> ...




The 'dark ages' reference is a good one and your three points are valid indeed. 'Being paid less' is a real issue around the world. It's always a relative issue too; paid compared to what? An increase of 3% in your wages just won't cut it if real inflation or the price one has to pay as soon as they wake up in the morning for just about anything, is at around +10% per year. And in the US, if your currency is devalued then its much worse. 

We are also bigger consumers than yester-year which adds to the problems of affordability and the need for even more (almost perpetual) debt. We have to keep up with the Jones. Hey, that was three years ago in the US. Now it's about surviving for many. 

Yes, it appears that some very influential elite organisations want the middle-classes' wealth transfered to their own, to a large extent. I think that the financial crisis of 2008 was one way to achieve this around the world. A triple-whammy for the elite as the transfer of wealth from middle to higher-end occurred, the elite banks then issued more debt to a struggling middle class, and to top it off, the middle class tax payer has future debt obligations to pay for 'too big to fail institutions'!

I'm kind of surprised that the FBI, etc etc including the military (CIA* etc) in the US, for example, doesn't have some shadow presence in 'Wall Street' to oversee and protect American interests. These institutions are America's last hope and best defense against the 'not in the US's interests' goings-on. I'm not talking about jurisdictional powers here. Just a presence and an opposing 'not in the US's interests' force. These organisations are the best at what they do covertly. Without a prosperous middle class and the transfer of wealth moving to an (non patriotic) elite these government organisations will lose power and influence.

*I know that the CIA isn't meant to operate in the US, but these are desperate times and nothing really needs to be logged for Congress to oversee. Congress is made up of elected officials that probably take bribes from 'not in the US's interests' domestic and foreign organisations. These US high-end protective service government organisations are more patriotic (many would die for their country) and their long-term existence is dependent on a prosperous and innovative middle class.


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## bandicoot76 (23 April 2011)

konkon said:


> *I know that the CIA isn't meant to operate in the US, but these are desperate times and nothing really needs to be logged for Congress to oversee. Congress is made up of elected officials that probably take bribes from 'not in the US's interests' domestic and foreign organisations. These US high-end protective service government organisations are more patriotic (many would die for their country) and their long-term existence is dependent on a prosperous and innovative middle class.




unfortunately a majority of the alphabetal organisations (CIA, FBI, ATF, NSA) are funded by, therefore also indebted to, the dept of treasury which get their money from "the federal reserve" private... yes PRIVATE!... banking cartel... the very 'elite' that are causing the problem in the first place! ppl will scoff at that previous comment but its all on public record.. do some research its not hard! 

just take a look at the major players... nearly ALL the top treasury officials are ex(? yeah right)goldman sachs ppl... goldman sachs one of the very corporations who caused the GFC with dodgy sub-prime derivative trading in the first place! the same goldman sachs who paid a $500mil settlement behind closed doors so they could keep their dodgy dealings locked behind closed doors away from public scrutiny... the same goldman sachs who tried to use bailout money to fund their executives  yearly bonuses...... and this is but ONE of the parasite corporations both hugely proffiting from the global chaos while facing NO public prosecution for their unethical (at best) behavior!.... 

add jpmorgan & chase manhattan to the list plus... well the list is quite long, too many parasites to ID on one post!... and you can see why the law enforcment agencies will never act against these financial mobsters & their cartel... unfortunately the FBI etc are part of the 'system' not part of the solution. maybe if ron paul and his entourage get some power the pendulum may swing back in favour of the productive (and relatively honest) middle class.

anybody with an inquisitive mind can find/check this information on the public record without much effort involved... it seems they just dont want to!


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## konkon (23 April 2011)

bandicoot76 said:


> unfortunately a majority of the alphabetal organisations (CIA, FBI, ATF, NSA) are funded by, therefore also indebted to, the dept of treasury which get their money from "the federal reserve" private... yes PRIVATE!... banking cartel... the very 'elite' that are causing the problem in the first place! ppl will scoff at that previous comment but its all on public record.. do some research its not hard!
> 
> just take a look at the major players... nearly ALL the top treasury officials are ex(? yeah right)goldman sachs ppl... goldman sachs one of the very corporations who caused the GFC with dodgy sub-prime derivative trading in the first place! the same goldman sachs who paid a $500mil settlement behind closed doors so they could keep their dodgy dealings locked behind closed doors away from public scrutiny... the same goldman sachs who tried to use bailout money to fund their executives  yearly bonuses...... and this is but ONE of the parasite corporations both hugely proffiting from the global chaos while facing NO public prosecution for their unethical (at best) behavior!....
> 
> ...




I agree about Goldman Sachs and other US corporations, not to mention Henry Paulson and other X-Goldman Sachs bosses etc. Yes the Federal Reserve is pretty much as private as Fed Ex. All of the above are all lawyered-up too and are thus protected and insulated. 

But I don't believe that the FBI, CIA, NSA etc are part of this conspiracy to defraud or transfer wealth from the middle classes. They are a part of the middle class system that got 'robbed'. Their paychecks come from treasury, that gets its funding from the Federal Reserve. In fact everyone gets its money this way in the US as the Fed loans money to the treasury with interest on top (perpetual debt). But this is the system that was set-up. The FBI, CIA, US Military, NSA etc etc had no say in the matter. 

These sacred US government organisations cannot operate like they do if the USD comes close to collapsing through overburdening perpetual debt obligations. *The CIA, NSA etc had nothing to do with the financial crisis. Why would these organisations want to destroy themselves? *

The NWO, for lack of a better name, on the other hand is partially operating outside of US borders and might end up seeking the destruction of the USD and the American economy. Perhaps the last hope the US has is for these US protective services agencies (FBI etc) to try and protect the middle classes and thus themselves.


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## tothemax6 (23 April 2011)

bandicoot76 said:


> unfortunately a majority of the alphabetal organisations (CIA, FBI, ATF, NSA) are funded by, therefore also indebted to, the dept of treasury which get their money from "the federal reserve" private... yes PRIVATE!... banking cartel... the very 'elite' that are causing the problem in the first place! ppl will scoff at that previous comment but its all on public record.. do some research its not hard!



Almost all of the feds 'profits' go to the government.
http://www.nytimes.com/2011/03/23/business/economy/23fed.html?_r=1&ref=business
That makes it as private as Australia Post.


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## Smurf1976 (23 April 2011)

Meanwhile closer to home, Australia continues down the "level playing field" delusion as industry after industry is smashed to pieces. We'd better hope the Chinese keep buying our rocks. That's about the only industry we'll have left if things keep going the way they are. 

It's alarmingly like the US situation, the only real difference being that we've got some rocks to sell. But in terms of any other industry, we're almost as stuffed as the Americans these days.

Take a look around the "industrial" part of most Australian cities and there it is. What were once major factories are now nothing more than warehouses housing imports of the goods they once produced or have simply been demolished. The towns, cities and entire states that relied most heavily on manufacturing have struggled economically for years as factory after factory has closed its doors forever. 

Port Huon, Electrona, the Stanley Works, ACI, Sheridan, Blundstone, Coats Paton, APPM, Tioxide, NW Acid, Southern Aluminium... All gone and never coming back. And that's just part of the list for Tasmania - there's far more in the other states. 

All looks good if you're digging up rocks in WA and Qld or are involved in financial services etc in Sydney and Melbourne. But times aren't so good anywhere else with manufacturing stuffed and even tourism now suffering at the hands of the  currency situation. 

We'd better hope they keep buying those rocks. We're in much the same situation as the US if they don't...


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## bandicoot76 (23 April 2011)

tothemax6 said:


> Almost all of the feds 'profits' go to the government.
> http://www.nytimes.com/2011/03/23/business/economy/23fed.html?_r=1&ref=business
> That makes it as private as Australia Post.




'control a nations money and i care not who makes its laws'... nathaniel rothschild

may not be word for word but close enough, its not about profits its about controling the financial system... i wont go on and on about it because theres enough info on public record about the corrupting nature of the 'fed' and the fate of those that oppose it (jfk being the last pres.. introducing exec order 111110 to shut the fed down) 

anyhow i'm straying... my point... thats right! my point being the taxpayer funded bailout money distributed by the fed at the height of the GFC... 
1) the fed chairman WILL NOT disclose to anyone where the money was allocated nor how much... not even when directly challenged by ron paul in a sitting of congress
2) the fed HAS NEVER EVER been audited BY ANYONE... independant nor government body... since its inception in 1913... so how can you know where its profits go??? a MSM journalist!? give me a break!!!
3) the fact that the bailout money was used to bail out banks, and not used to help ppl being evicted from their homes to stay in them is the most dispicable, disgusting, immoral and unethical situation in american financial history! SHAME ON THE FED, SHAME ON DEPT TREASURY and SHAME ON PUPPET... sorry i mean PRESIDENT OBAMA!

if they had made those trillions of dollars into long term, low interest, govt backed loans to the mortagee's being evicted it would have:
1) saved thousands of ppl being thrown out of their homes and onto the street & living on welfare
2) stopped the real estate crash that followed the glut of houses being sold as a result of foreclosures
3)THE MONEY WOULD HAVE ENDED UP WITH THE BANKS IN THE END ANYWAY, IT JUST WOULD HAVE DONE SOME GOOD ON THE WAY AS IT TRICKLED THROUGH THE ECONOMY TO ITS END DESTINATION! PERHAPS EVEN STOPPING THE GFC FROM HAPPENING OR AT WORST LIMITING ITS EFFECTS ON THE LITTLE PPL

you are trying to defend the undefendable mate! the fed is scum!


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## LifeChoices (23 April 2011)

bandicoot76 said:


> 'control a nations money and i care not who makes its laws'... nathaniel rothschild
> 
> may not be word for word but close enough, its not about profits its about controling the financial system... i wont go on and on about it because theres enough info on public record about the corrupting nature of the 'fed' and the fate of those that oppose it (jfk being the last pres.. introducing exec order 111110 to shut the fed down)
> 
> ...





Ok this is the 50th post on this - You've convinced me we're f'cked.

So what is the solution. I'm thinking I'll buy a whole lot of silver bulion and heaps of scotch whisky and hide out in a cave somewhere in Tasmania while it all plays out - am I on the right track here?


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## bandicoot76 (23 April 2011)

konkon said:


> . *The CIA, NSA etc had nothing to do with the financial crisis. Why would these organisations want to destroy themselves? *
> 
> Perhaps the last hope the US has is for these US protective services agencies (FBI etc) to try and protect the middle classes and thus themselves.




i truly hope that they do do something but while they may not be actively involved in the scam, they take their orders from ppl who are... otherwise explain why have no prosecutions taken place when there is SO much evidence that blatant fraud was involved?

 lets hope the FBI grows some balls and steps up to the plate! for our sakes as well as the yanks cos we just feed off their scraps in the big picture of things!


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## bandicoot76 (23 April 2011)

LifeChoices said:


> Ok this is the 50th post on this - You've convinced me we're f'cked.
> 
> So what is the solution. I'm thinking I'll buy a whole lot of silver bulion and heaps of scotch whisky and hide out in a cave somewhere in Tasmania while it all plays out - am I on the right track here?




where did anyone ever say things were f*cked?? nothings ****ed unless ppl let it get to that point! there are ALOT of ppl around the world who are fed up with being f*cked over by the same badstards, getting the information out there for ppl to become aware is the big issue, fighting the bastards by awakening the 'slumbering masses' is the way to maintain our freedoms... not by running away with your tail between your legs like a mongrel dog to 'hide in a cave'....

 but do nothing and the transfer of wealth from the middle class to the robber-baron elite class will continue and you WILL become a financial slave, not having enough income to meet your living expenses (which will yoyo due to inflation and deflation which is manipulated & controlled by institutions like 'the fed' to facilitate their own gain at OUR loss) 

so its your call mate, play their game or wake up and educate yourself and as many other ppl as you can to whats really happening... 

me i'm taking the 'hope for the best but prepare for the worst' approach and try in my own way to get as many ppl as i can to educate themselves on the situation... if that makes me paranoid in some ppl's eyes so be it.. better to think about these things than have your head buried in the sand is my position & i'm sticking to it! you can do what ever pleases you.


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## Julia (23 April 2011)

So, Bandicoot, in very basic, practical terms, what do you suggest the ordinary Australian should do?


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## bandicoot76 (23 April 2011)

Smurf1976 said:


> Meanwhile closer to home, Australia continues down the "level playing field" delusion as industry after industry is smashed to pieces. We'd better hope the Chinese keep buying our rocks. That's about the only industry we'll have left if things keep going the way they are.
> 
> It's alarmingly like the US situation, the only real difference being that we've got some rocks to sell. But in terms of any other industry, we're almost as stuffed as the Americans these days.
> 
> ...




spot on summary smurf! but it is not a seperate issue... its all rolled into the same situation we are discussing on this forum (yes we are focussing on the USA mostly but in practical terms australia is a flea on the yanks back, whatever affects them affects us also)

if you are interested in this topic but with the australian perspective i reccomend you read a book called: 'what will we tell our children' by jeremy lee... awesome reading
plus anything by the canadian author john ralston saul and/or the american congressman Ron Paul, 

 ppl really need to educate themselves as there is nothing on the MSM showing what is happening behind the scenes & how we are being manipulated by these elitist eugenicist bastards!


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## LifeChoices (23 April 2011)

bandicoot76 said:


> if you are interested in this topic but with the australian perspective i reccomend you read a book called: 'what will we tell our children' by jeremy lee... awesome reading
> plus anything by the canadian author john ralston saul and/or the american congressman Ron Paul,




When the zimbabwian dollar collapsed I gave my kids 300 trillion dollars each for their birthdays.

Are you able to paraphrase those books into a couple of easy to read paragraphs - I'm looking for some more birthday ideas.


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## bandicoot76 (23 April 2011)

Julia said:


> So, Bandicoot, in very basic, practical terms, what do you suggest the ordinary Australian should do?




i'm no expert and everyone should carefully consider their own situation before doing ANYTHING... but what i'm doing is

1) educating myself from as many varied sources as i can (and cross referencing that info as well) to make damn sure the information i'm reading is genuine and not some bogus wind-up being put out there by crooks or bearish traders looking to do some short selling at my expense (i suggest EVERYONE research as much as the can independantly of the MSM) google is handy

2)try to educate as many other ppl on the topic as i can... i was first told about it by an old spanish workmate of mine over a beer after workin 1998.. out of the blue he said "if you dont wake up your children will all be slaves"... (he started talking about his experience in europe with the setting up of the EU.. look whats happening there now!)...scared the crap out of me but then told me why it just made me sooo mad!

3) introduce the topic into conversations (without jamming it down ppls throats & putting them offside) and try to bring ppl into the discussion to get the topic into the open... most yanks think the federal reserve is a US govt bank and are amazed then outraged when they discover its a private bank run by a cartel of bankers, has NO govt oversite and has NEVER been audited EVER! 


4)pay off as much debt as i can... starting with personal debt, avoid spending money on anything non-essential so as to have the money to pay down that debt! try to build up a diversified asset base that will retain its value irrespectave of what the financial system is doing as well as a decent share portfolio (see next point)

5)fight fire with fire... watch what the bigwigs are doing and do the same... when the GFC was at its worst warren buffet was buying quality stocks in a frenzy at rock bottom prices, buy when other ppl are scared sell when other ppl are greedy & have forgotten their fear... then use that money to pay down debt youve accumulated while building up your other asset base... basically accumulate assets that you can fight tooth & nail to retain if the sh*t ever hits the fan big time 

6) keep your pantry stocked (min 3months) and your powder dry 

7)hope for the best but prepare for the worst!

... but thats just me


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## bandicoot76 (23 April 2011)

LifeChoices said:


> When the zimbabwian dollar collapsed I gave my kids 300 trillion dollars each for their birthdays.
> 
> Are you able to paraphrase those books into a couple of easy to read paragraphs - I'm looking for some more birthday ideas.




i hope i'm taking your quote in the right context as being serious and not a piss-take?

those books: 

'what will we tell our children'   by jeremy lee (australian author)

'voltaires bastards'   by john ralston saul (former canadian govenor general)

'liberty defined'      by US congressman Ron Paul (libertarian (R) texas congressman)


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## LifeChoices (23 April 2011)

bandicoot76 said:


> i hope i'm taking your quote in the right context as being serious and not a piss-take?
> 
> those books:
> 
> ...




Yeah... can you paraphrase them into a couple of easy to read paragraphs?


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## bandicoot76 (23 April 2011)

LifeChoices said:


> Yeah... can you paraphrase them into a couple of easy to read paragraphs?




no probs for jeremy lee's "what will we tell our children".. but i havnt got the others with me @ the moment, but it doesnt matter as this is by far the best of the 3!!!! 

On November 19, 1993, at a meeting of the Asia Pacific Economic Community (APEC) in Seattle, WA, under the chairmanship of U.S. President Bill Clinton, Australia lost the final remnants of its sovereignty, bringing to an end a nearly 50-year process which began when Australia's governing cabinet agreed to sign the November 19, 1946 Bretton Woods International banking agreement after World War II. 

 Australia had emerged from World War II with one of the strong*est economies in the world, the highest standard of living, and it was totally self-sufficient with its broad base of small farms. Now sixty percent of the Australian-owned farming sector has been wiped out. In 1960, there were 300,000 farms; now there are not even 100,000. In 1997, the remaining farmers were quitting the land at the rate of 35 per week. Of the remainder, 80% were in debt, owing $18 billion to banks in mid-1996, an average of $133,000 per farm. 


In 1972, the national debt of Australia was $23 billion, with a manageable 9.8% GDP in 1982. But to keep up its high standard of living, the Australian Government borrowed billions of dollars from private banks at high rates of interest, which plunged it into a debt of $225 billion. The interest payments on this huge debt deprived the Government of the money it needed for many of its social programs.


“The last half of the '80's and the first half of the '90's carried Australia through an escalating crisis which saw tens of thousands of domestic enter*prises either close down, move offshore, or be swallowed up by foreign multinationals. The latter, given full rein by the goverment, cut through the Australian economy like sharks. Satiated by a limitless choice of targets, they simply toyed with dis*integrating Australia. They kept the names of the ‘icons’ they had swallowed where it suited them. As Australian-made goods disappeared from the retail shelves, they were replaced with foreign-owned goods – either from overseas or from foreign-owned productive units in Australia. 

“Hardworking Australians stood bewildered in fields of unmarketable fruits and vegetables, while overseas produce was shipped in to fill market space which once carried Australian goods; orange juice from Latin America, while Australian citrus rotted on the trees; fresh and frozen vegetables from Southeast Asia, while Australians ploughed their unsaleable produce back into the soil; pork from Canada, jams and bottled preserves from Poland, fish products from China and Scandina*via... The importation of steel-based items... and electrical products were legion.” 

thats just some random passages i had on file from a previous discussion with someone i was trying to 'awaken' lol....


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## tothemax6 (24 April 2011)

Smurf1976 said:


> Meanwhile closer to home, Australia continues down the "level playing field" delusion as industry after industry is smashed to pieces. We'd better hope the Chinese keep buying our rocks. That's about the only industry we'll have left if things keep going the way they are.



Unavoidable - the facts are that we have lots of dirt to sell, and the demand for said dirt is high. What else was going to happen? Naturally, our efforts get focused on mining because that's where the profit is to be had. When the Chinese construction bubble crashes, we will have a recession, and resources will be reallocated to other industries according to their profitability. These other industries that are disappearing will come back, and the mining industry will contract.


bandicoot76 said:


> 'control a nations money and i care not who makes its laws'... nathaniel rothschild
> 
> may not be word for word but close enough, its not about profits its about controling the financial system... i wont go on and on about it because theres enough info on public record about the corrupting nature of the 'fed' and the fate of those that oppose it (jfk being the last pres.. introducing exec order 111110 to shut the fed down)
> 
> ...



Oh come on. Spare me this hysterical, sky-is-falling, conspiracy theory spit-fest. Do you read your own posts? You look like a lunatic. Do you even live in America?
Oh sorry, ) DO YOU EVEN LIVE IN AMERICA! BLAH BLAH THIS SENTENCE IS GOING TO HAVE TO BE REALLY LONG ...... BECAUSE THIS IS REALLY SCARY AND IMPORTANT!!!

Yes the fed should not exist. But this is not specific to the US. *No* central bank should exist. Yes, the Rothschild's were really powerful, and are really rich. Good for them. The story of Rothschild, who left a jewish ghetto with nothing, and built the wealth and power that he did, creating a whole dynasty, is amazing. I would have loved to have met the guy and gained an insight into his mind.


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## bandicoot76 (24 April 2011)

tothemax6 said:


> Oh come on. Spare me this hysterical, sky-is-falling, conspiracy theory spit-fest. Do you read your own posts? You look like a lunatic. Do you even live in America?
> Oh sorry, ) DO YOU EVEN LIVE IN AMERICA! BLAH BLAH THIS SENTENCE IS GOING TO HAVE TO BE REALLY LONG ...... BECAUSE THIS IS REALLY SCARY AND IMPORTANT!!!




your very good at ad hominem attacks but very weak on substance to back up your big mouth little troll,

nothing i have posted on here cant be verified by a quick google search... hardly hysterical and by labelling everything a 'conspiracy theory' or 'lunatic' without ever bothering to do a little research shows how narrow minded and ignorant you are.

go tell the thousands of ppl in USA who lost their homes only to discover that their tax money was used to support the banks & not the mortagee's that they are conspiracy theorist nut-job sky is falling lunatics and see how long it takes them to wipe that smirk of your face, mr smarty-pants! 

(not that its any of your business but i worked for a yank company for nearly 3 yrs & am still good friends with some of my old work crew... get them going on the subject and they'll burn your ears off with how bad the situation is in the US for the 'lower' classes....)

...so in summary.. you disagree with what ive posted...fine.. your choice! try to belittle my comments without actually adressing them tho & well you can just F*CK OFF


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## bandicoot76 (24 April 2011)

i'm not saying what ive posted is the whole truth & nothing but the truth... i just believe there is enough evidence out there to suggest that things arent as they should be, look @ usa, look @ greece, portugal, spain, ireland... we are living in a fools paradise if we dont think it can happen to us too!

SO FOR LITTLE TROLLS I'LL PUT MY MONEY WHERE MY MOUTH IS! DISPROVE THE POINTS IVE MADE IN MY PREVIOUS POSTS, SHOW THEM TO BE ALARMIST MADE UP B/S AND NOT COLD HARD FACTS & I WONT POST ANOTHER "LUNTATIC CONSPIRACY SPIT-FEST' POST ON ASF EVER EVER AGAIN!

STEP UP TO THE PLATE


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## bandicoot76 (24 April 2011)

bandicoot76 said:


> ' my point being the taxpayer funded bailout money distributed by the fed at the height of the GFC...
> 1) the fed chairman WILL NOT disclose to anyone where the money was allocated nor how much... not even when directly challenged by ron paul in a sitting of congress
> 2) the fed HAS NEVER EVER been audited BY ANYONE... independant nor government body... since its inception in 1913... so how can you know where its profits go??? a MSM journalist!? give me a break!!!
> 3) the fact that the bailout money was used to bail out banks, and not used to help ppl being evicted from their homes to stay in them is the most dispicable, disgusting, immoral and unethical situation in american financial history! SHAME ON THE FED, SHAME ON DEPT TREASURY and SHAME ON PUPPET... sorry i mean PRESIDENT OBAMA!
> ...




just out of interest,  who (besides little troll, i know his opinion) thinks that the information i have posted (like the example quoted above) is complete bollocks, not true & just 'the-sky-is-falling' nonsense? 

i'd like feedback both negative & positive (as long as its not just insults with no evidence to back  it up) to see if the opinion i have reached/ interpreted from all the information that ive researched is so skewed from reality as mr troll says it is???


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## LifeChoices (24 April 2011)

You and konkon sound like nutbags to me. It wouldn't surprise me if you soon start ranting that  9/11 and the London bombings were conspiracies. It's entertaining to a point, but after a while I just switch off - which I guess most people also do.


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## tothemax6 (24 April 2011)

Bandicoot, you are a lunatic. 
This is not an ad hominem attack, it is an observation. Indeed, as if to provide proof of this lunacy, you spewed three more posts of the same bile. 

It is one thing to have a calm and rational debate about the causes of the 2008 crash, and to discuss the nature of the Federal Reserve. It is another to howl and shriek like a frenzied mad man. I enjoy the former, I will take no part in the latter. Ciao.


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## Uncle Festivus (25 April 2011)

bandicoot76 said:


> 5)fight fire with fire... watch what the bigwigs are doing and do the same... when the GFC was at its worst warren buffet was buying quality stocks in a frenzy at rock bottom prices, buy when other ppl are scared sell when other ppl are greedy & have forgotten their fear... then use that money to pay down debt youve accumulated while building up your other asset base... basically accumulate assets that you can fight tooth & nail to retain if the sh*t ever hits the fan big time
> 
> 6) keep your pantry stocked (min 3months) and your powder dry
> 
> ...




The GFC was just the 9pm kiddies fireworks before the real show at midnight.

Buffet lost big time on a lot of wrong bets, and only bought 'distressed' assets because he was fully 'informed' & backstopped by a large organisation ie something like the US Fed?

The strategy of step 5 (apart from paying down debt) will not be able to be enacted because when midnight comes the traditional markets will be frozen solid ie not tradable! First they will stop short selling, then apply limit downs then a range of other measures all the  way to finally an indefinate market halt, a bit like the property trusts have been for the last 4 years.

So, the only real way to prepare is to have physical cash and assets worth exchanging goods & sevices for. What they are I will leave it to you, but they are metallic & shiny

I think we are closer to the start of the final show that we are to the end of the GFC?


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## Uncle Festivus (25 April 2011)

LifeChoices said:


> You and konkon sound like nutbags to me. It wouldn't surprise me if you soon start ranting that  9/11 and the London bombings were conspiracies. It's entertaining to a point, but after a while I just switch off - which I guess most people also do.




I thought we might have got the 'clock is right twice a day' thingy too but alas.....

From casual observance over the years, the above is to be expected when the future is uncertain - a human trait whereby bad or negative news is somehow wished away or ignored, and eventually repeated negative news becomes the morm and is in fact totally ignored, a bit like the global financial system now.

Five years ago if a country announced it was insolvent there would be a major market correction - now the markets actually go up because they know that big brother Bernanke and his Euro mates will continually print more money to bail out entire countries!

Until, that is, 1 country (ie Finland) decide not to pay their portion of bail-out funding because they can't see why they should support poorly run countries. It starts off slowly but then one after another, the funding dries up, while the number willing to buy the debt bonds (Pimco & China) say 'had enough'...........



> BEIJING, April 23 (Xinhua) -- China should reduce its  excessive foreign exchange reserves and further diversify its holdings,  Tang Shuangning, chairman of China Everbright Group, said on Saturday.
> The amount of foreign exchange reserves should be restricted to  between 800 billion to 1.3 trillion U.S. dollars, Tang told a forum in  Beijing, saying that the current reserve amount is too high.
> China's foreign exchange reserves increased by 197.4 billion U.S.  dollars in the first three months of this year to 3.04 trillion U.S.  dollars by the end of March.
> *Tang's remarks echoed the stance of Zhou Xiaochuan, governor of  China's central bank, who said on Monday that China's foreign exchange  reserves "exceed our reasonable requirement" and that the government  should upgrade and diversify its foreign exchange management using the  excessive reserves.*



Now, for the unbelievers, you have to tell us how the US will get the green line in the following chart back to or close to zero, while at the same time attracting the money to cover the shortfall. It's simple maths really - either the expense side has to reduce dramatically or the income side has to rise dramatically, or a combination of both.

I don't believe it's possible, under the current political  system, for the humans resposible, to impose the conditions neccesary for a balanced budget to exist. You only have to observe what happens in the insolvent countries when austerity measures are enacted. The US is still in recession.

The Jaws Of Death


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## professor_frink (25 April 2011)

Uncle, the recession ended in 2009.

In the future, if you would like to stay up to date with business cycle dates, you can check the NBER's website:

http://www.nber.org/cycles/

Cheers


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## konkon (25 April 2011)

LifeChoices said:


> You and konkon sound like nutbags to me. It wouldn't surprise me if you soon start ranting that  9/11 and the London bombings were conspiracies. It's entertaining to a point, but after a while I just switch off - which I guess most people also do.




No. 9/11 and the London bombings were NOT conspiracies. 

Switched-on or switched-off. Interesting.


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## bandicoot76 (25 April 2011)

tothemax6 said:


> Bandicoot, you are a lunatic.
> This is not an ad hominem attack, it is an observation. Indeed, as if to provide proof of this lunacy, you spewed three more posts of the same bile.
> 
> It is one thing to have a calm and rational debate about the causes of the 2008 crash, and to discuss the nature of the Federal Reserve. It is another to howl and shriek like a frenzied mad man. I enjoy the former, I will take no part in the latter. Ciao.




i suggest you look up the definition of an ad hominem attack 'an attack of the persons character to try to discredit his position' ... i posted alot of (probably too much) information that i have gathered over the years... not once did you attempt to discredit the evidence other than attacking me as a 'lunatic'. 

if you had come out and said.. 'well that point is not correct or is only a half truth you've bent to suit your arguement' etc, then i would have engaged you in a debate... but you attacked me personally to belittle and discredit my position... then you have the nerve to act all offended when i reply in kind. 

words such as 'spewed bile, howl, shriek, frenzied mad man, lunatic nutbag' all aimed at character assassination rather than addressing my points. that is the context that YOU decided to take my posts in... 

its not the way i have tried to promote my position (and if that is how i do come across i apolagise to the ASF members reading my posts) they are meant to be informative & give ppl an alternative veiwpoint rather than be just another rant. i thought the info that i have provided would have shown that!      

   ...anyhow no positive comments on the points i make in my posts yet so looks like your winning troll... i'll give it another couple of days but till then i'm outa here... sweet dreams...


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## konkon (25 April 2011)

Smurf1976 said:


> Meanwhile closer to home, Australia continues down the "level playing field" delusion as industry after industry is smashed to pieces. We'd better hope the Chinese keep buying our rocks. That's about the only industry we'll have left if things keep going the way they are.
> 
> It's alarmingly like the US situation, the only real difference being that we've got some rocks to sell. But in terms of any other industry, we're almost as stuffed as the Americans these days.
> 
> ...




So, so true! The so-called 'free-trade' ethos that governments, media etc love will cause more problems here in Australia, as it did in the US, Europe etc. How does one have 'free-trade' when the rules (wages etc) are different for trading countries? 

*Would the skeptics play a game like Monopoly if the rules were different for the players, but you still had to trade freely with other players? It would end up a very short game, anyway. *

Here's another one they love: 'skilled labour' or 'skilled labour shortages'. Isn't this cheaper labour in Australia that will mean more demand for housing that's not in oversupply? I don't have a problem with more migrant workers, but where's the infrastructure (and manufacturing sectors) to meet demands? As Smurf1976 suggests, we no longer have a manufacturing force we once did in Australia.


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## konkon (25 April 2011)

bandicoot76 said:


> i truly hope that they do do something but while they may not be actively involved in the scam, they take their orders from ppl who are... otherwise explain why have no prosecutions taken place when there is SO much evidence that blatant fraud was involved?
> 
> lets hope the FBI grows some balls and steps up to the plate! for our sakes as well as the yanks cos we just feed off their scraps in the big picture of things!




These organisations (through no fault of their own) were, at times, made to look the other way or even if they weren't their jurisdictional powers did not reach into protected and lawyered-up areas. 

I bet organisations like the FBI, NSA etc have volumes of evidence but are unable to use it in courts. Well the NSA wouldn't. 

I wonder what the public reaction would be like if leaked files, tapes etc would show how ruthless (and uncaring) CEOs etc are when they are in negotiations behind closed doors. This would go a long way to enlighten the public even further. Maybe some would then get switched-on!


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## konkon (25 April 2011)

bandicoot76 said:


> 'control a nations money and i care not who makes its laws'... nathaniel rothschild
> 
> may not be word for word but close enough, its not about profits its about controling the financial system... i wont go on and on about it because theres enough info on public record about the corrupting nature of the 'fed' and the fate of those that oppose it (jfk being the last pres.. introducing exec order 111110 to shut the fed down)
> 
> ...




Your points are excellent but I have to disagree with some. 

I personally don't see Bernanke himself as scum. I think he was used and perhaps ended up getting his job because of his expertise in the Great Depression and his strong belief that it could have been prevented if the Fed in the 1930s supplied banks with liquidity instead of cutting supply. So 'they' had someone in charge that would, under similar circumstances, keep the money-supply going at record volumes. And we know what happened. 

I think that Bernanke is opening up the Fed to the world, because he probably now realises this and does care about the American economy and his own job. He has to now because there is a growing push to end the Fed, and the pressures are coming from all angles; The Tea Party, media, many in the judiciary (that see the Fed as unconstitutional). I know many will disagree but I think 'they' had their man in charge of money supply, and Bernanke was read like a book. I think that Henry Paulson etc played Bernanke like a fiddle during those crucial over-the-weekend meetings to 'save' the financial system. I think that Bernanke would have realised then that the X-CEO of Goldman Sachs, Henry Paulson, negotiated moves that meant that Goldman Sachs would come out of the 'negotiations' a bigger and better future company. 

The JFK reference is important, as he tried to use a silver-standard to bypass the Fed and go strait to Treasury to print legal tendered currency. 4 to 5 months later, Kennedy was assassinated. No link intended!!

Many believe the banks' failures shouldn't have been 'insured' by future tax-payer liabilities. However what choice did Bernanke have? If he allowed the financial system to collapse then you would have a worse situation in the US and around the world. *The US will one day restructure or reset its economy and currency* and it will be its creditors, like China, that will be left without a chair to sit on. 

Bill Gross seems to think the US will not be in a position to pay its debt obligations, and he, to me, is as close to an economic oracle as we have. Most other leaders in the economic world are just sales-reps, pushing all kinds of products. 

Obama inherited this mess. Bush and his entourage had so much more to do with the GFC.


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## Plumber1 (25 April 2011)

Konkon,
I agree with every word that you have written. Well done. An excellent post


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## Frank D (25 April 2011)

konkon said:


> Obama inherited this mess.




Yes he inherited * a ‘mess’,* but along the way he has made it much worse.

How does a President double the national debt in less than 1 term in office? And
 shows no signs of trying to rectify the problem. Sorry, but I don’t believe in
 increasing taxes is the answer

*It’s his mess now, and it's deliberate.*



konkon said:


> Bush and his entourage had so much more to do with
> the GFC.




 Bush and his entourage might have been implicate, however, *illogical policies 
 born out of freedie and fannie *combined with the Fed feeding the bubble was the
 main driver that contributed to the GFC.

I might not agree with everything you and Bandicoot have posted, but
commonsense tells me that it stinks, & it’s deliberate.


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## konkon (25 April 2011)

Frank D said:


> Yes he inherited * a ‘mess’,* but along the way he has made it much worse.
> 
> How does a President double the national debt in less than 1 term in office? And
> shows no signs of trying to rectify the problem. Sorry, but I don’t believe in
> ...




I think increasing wages (the minimum wage especially in the private sector, of around 25%) and not increasing taxes is the right move. Just reset the economy. 

I am watching something right now on Goldman Sachs on CNBC. They seem to be paying Goldman out (criticising them) about the way they operated. Too right! 

How deliberate is what is happening in the US? Does everyone believe in the 'united' in the United States? I'm sure most (nearly all) do. But I don't believe the so called NWO do. A part of this shadow organisation must operate outside of the US. 

I don't see this happening but, I wonder if some states in the US might eventually want to break-away from the unity even if it's in the monetary sense; by legally creating and using their own currency. I hear this is occurring in some areas already. Not really a good idea though.


----------



## tothemax6 (25 April 2011)

konkon said:


> I think increasing wages (the minimum wage especially in the private sector, of around 25%) and not increasing taxes is the right move. Just reset the economy.



Really. Just 'reset the economy'. 

Konkon, where exactly did your economics education come from? I can see no logical cohesion between any of your sentences. 
You are to coherent, correct economics as a mosh pit is to a ballet. 

I suggest you read Hazlitts 'economics in one lesson'.


----------



## konkon (25 April 2011)

tothemax6 said:


> Really. Just 'reset the economy'.
> 
> Konkon, where exactly did your economics education come from? I can see no logical cohesion between any of your sentences.
> You are to coherent, correct economics as a mosh pit is to a ballet.
> ...




Really? Where were all the academics and their text books before the GFC? Most are still trying to pigeon-hole their beliefs and theories and while they're at it, everything else too. 

I can jump from one position to the next and why should I structure statements in a paragraph (on a forum) with a premise leading to a conclusion, every single time? It doesn't have to be this way. Some of my previous posts suggest a possible restructure of the US economy and it may involve a reset of the currency. Maybe. But we're all just speculating. 

Best to stick to your text books and their 'logical' cohesion. They will tell you about the real world and what might come next.


----------



## tothemax6 (25 April 2011)

konkon said:


> Best to stick to your text books and their 'logical' cohesion. They will tell you about the real world and what might come next.



They do, so long as you pick the right textbooks. One has to have a theoretical foundation, upon which to base ones 'real world' insight, yes?

This guy for instance, has been educated by reading quality economics from the likes of Hazlitt and von Mises. It allowed him to clearly see the sub-prime crisis approaching:
http://www.youtube.com/watch?v=jj8rMwdQf6k
http://www.youtube.com/watch?v=LfascZSTU4o


----------



## konkon (25 April 2011)

tothemax6 said:


> They do, so long as you pick the right textbooks. One has to have a theoretical foundation, upon which to base ones 'real world' insight, yes?
> 
> This guy for instance, has been educated by reading quality economics from the likes of Hazlitt and von Mises. It allowed him to clearly see the sub-prime crisis approaching:
> http://www.youtube.com/watch?v=jj8rMwdQf6k




But I did see a crash coming even as early as 2007; I still have the correspondence between friends and I, and I saved these on my other computer literally telling them to get out of the markets back then. The numerous telephone calls were not recorded by me though, but they all remember them. I was selling my own stock August of 2007 after the up-tick rule was lifted in the US. Now did I need to read about so-called quality economics then? No. There are always opposing views by scholars anyway and like I suggested before, they can pigeon-hole their views as much as they like. It doesn't matter to me. I'll pick what ever I see as useful whether it be on a finance 'show' or an article. My day job etc doesn't allow me the chance to follow or read about economics like a scholar might. I won't change my methods either as I see advantages to the way I think and go about things. 

Now how about the large percentage of so called experts that missed the GFC, even after the clear warnings in 2007 (and before)? Economists on 'shows' like CNBC and Bloomberg got it wrong repeatedly and so did large corporations that kept piling large borrowed funds into risky markets. 

I guess you and all those 'experts' can trade and formulate opinions any way you like. It makes no difference to me. I'll keep doing it my way. Hope that's alright with you?


----------



## LifeChoices (25 April 2011)

konkon said:


> But I did see a crash coming even as early as 2007; I still have the correspondence between friends and I, and I saved these on my other computer literally telling them to get out of the markets back then. The numerous telephone calls were not recorded by me though, but they all remember them. I was selling my own stock August of 2007 after the up-tick rule was lifted in the US. Now did I need to read about so-called quality economics then? No. There are always opposing views by scholars anyway and like I suggested before, they can pigeon-hole their views as much as they like. It doesn't matter to me. I'll pick what ever I see as useful whether it be on a finance 'show' or an article. My day job etc doesn't allow me the chance to follow or read about economics like a scholar might. I won't change my methods either as I see advantages to the way I think and go about things.
> 
> Now how about the large percentage of so called experts that missed the GFC, even after the clear warnings in 2007 (and before)? Economists on 'shows' like CNBC and Bloomberg got it wrong repeatedly and so did large corporations that kept piling large borrowed funds into risky markets.
> 
> I guess you and all those 'experts' can trade and formulate opinions any way you like. It makes no difference to me. I'll keep doing it my way. Hope that's alright with you?




I guess that makes you the expert then - I'm assuming the illuminati are going to replace the currency very soon.

Can you look into your youtube video library one more time and tell the rest of us what date you think this will all happen?


----------



## bandicoot76 (25 April 2011)

ok so no-one is interested, my bad... i'll leave it at that and withdraw from this thread thoroughly defeated... 

personally i hope that none of the things that i fear are going to happen ever do... i'll be pleased to be told in 20yrs time 'see all your worrying was for nothing!'  

but i'll leave with the quote of one of the men i most admire in history... mr thomas jefferson:

"I sincerely believe that banking establishments are more dangerous than standing armies, and that the principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale." 
”” Thomas Jefferson


----------



## explod (25 April 2011)

bandicoot76 said:


> ok so no-one is interested, my bad... i'll leave it at that and withdraw from this thread thoroughly defeated...
> 
> personally i hope that none of the things that i fear are going to happen ever do... i'll be pleased to be told in 20yrs time 'see all your worrying was for nothing!'
> 
> ...




bandicoot76, with you all the way.  On a hoiliday weekend you are not going to find many of the in-depth about.  Hang in there, you are very much appreciated.

And agree, the bankers are the crooks so have some barter material about for when they get caught out.


----------



## bandicoot76 (25 April 2011)

explod said:


> bandicoot76, with you all the way.  On a hoiliday weekend you are not going to find many of the in-depth about.  Hang in there, you are very much appreciated.
> 
> And agree, the bankers are the crooks so have some barter material about for when they get caught out.




unfortunately:  "who is john galt"

over & out.


----------



## explod (25 April 2011)

bandicoot76 said:


> unfortunately:  "who is john galt"
> 
> over & out.




Maybe he is our combination.

Seek the truth and expose the lie.


----------



## tothemax6 (25 April 2011)

bandicoot76 said:


> unfortunately:  "who is john galt"
> over & out.



Hah, really? Now you are going to pose as an objectivist?

This thread is one big pile of WTF.


----------



## LifeChoices (25 April 2011)

bandicoot76 said:


> unfortunately:  "who is john galt"
> 
> over & out.




I'm sure he won Biggest Loser or was it Big Brother a few years ago? 

Nah, sorry, I was thinking of Fitsy


----------



## bandicoot76 (25 April 2011)

tothemax6 said:


> Hah, really? Now you are going to pose as an objectivist?
> 
> This thread is one big pile of WTF.




put your text book down and step into the real world for awhile.... 

DAMN i was supposed to be going john galt... well starting from now...


----------



## IB12 (25 April 2011)

Everything about US dollar weakness has been all about fundamental analysis, especially over the medium to long term.

If you think technical analysis has explained the AUD/USD rate going from 90c to $1.07 you're kidding yourself.


----------



## Uncle Festivus (25 April 2011)

professor_frink said:


> Uncle, the recession ended in 2009.
> 
> In the future, if you would like to stay up to date with business cycle dates, you can check the NBER's website:
> 
> ...




By that measure.

GDP can be manipulated, which shows up as government expenditure in my previous chart. When that stops, GDP will drop, and they will have another NBER recession.....only matters to the bobble heads who believe the mainstream propaganda distributors.....

From the nice work experience kids at NBER.......



> In determining that a trough occurred in June 2009, the committee did  not conclude that economic conditions since that month have been  favorable or that the economy has returned to operating at normal  capacity



Food Stamps Program - 
2006 - 26 Million people
2011 - 44 Million people - increasing at 400 thousand a month!

Standard & Poors on the housing recession recent data - 

*These data confirm what we have seen with recent housing starts  and sales reports. The housing market recession is not yet over, and  none of the statistics are indicating any form of sustained recovery*.


----------



## professor_frink (26 April 2011)

Uncle Festivus said:


> By that measure.
> 
> GDP can be manipulated, which shows up as government expenditure in my previous chart. When that stops, GDP will drop, and they will have another NBER recession.....only matters to the bobble heads who believe the mainstream propaganda distributors.....




So government spending is classified as manipulation now

If the government withdraws fiscal stimulus before the recovery is self sustaining, then there is the potential for another recession. But why on earth would they want to do that? I know that the political situation over there is currently pretty bad, but I really can't see either party wanting to be the ones responsible for forcing a recession in a country where unemployment is already so high.


----------



## Uncle Festivus (26 April 2011)

professor_frink said:


> So government spending is classified as manipulation now
> 
> If the government withdraws fiscal stimulus before the recovery is self sustaining, then there is the potential for another recession. But why on earth would they want to do that? I know that the political situation over there is currently pretty bad, but I really can't see either party wanting to be the ones responsible for forcing a recession in a country where unemployment is already so high.




Well, yes. That's the whole point of the government 'stepping up to the plate' and filling the hole left by non spending private sector, only it is leaving a huge government debt behind, and no certainty that the 'recovery' is self sustaining. In fact the latest data suggest it is not ie Philly Fed Manufacturing Index just plunged from 43 to 18! Company margins are non existent.

The problem will be, when this is realised, that they (the US Fed etc) will have spent all the ammo already with QE and will therefore have no choice but to make the hard choices ie cut spending ie pretty much everything really.

The fact that neither party wants to be the one seen to have initiated a recession by cutting spending means that it can & will get much worse very quickly. And it has to be spending cuts as tax income is not sufficient. Under 'the plan' the assumption is that income from personal tax will (needs to) grow by over 50% over the period allowed for the deficit to be contained. This as well as spending cuts of similar draconian proportions.

Just because something seems to be implausible doesn't mean it's not possible.


----------



## explod (26 April 2011)

professor_frink said:


> So government spending is classified as manipulation now
> 
> If the government withdraws fiscal stimulus before the recovery is self sustaining, then there is the potential for another recession. But why on earth would they want to do that? I know that the political situation over there is currently pretty bad, but I really can't see either party wanting to be the ones responsible for forcing a recession in a country where unemployment is already so high.




It is my take that there has been no recovery.  Not of substance anyway.  Q/e by money creation from thin air is not a recovery.

One only has to look at the 20 year chart of the Dow and it can be seen where recoveries (dot.com etc.) are rebuilt on the release of low interest money and now of course no interest money.

Unless value goes back to a measure of physical output (which is the real GDP) there will be no recoveries.

Though one may not entirely agree across the board, a lot can be learned by reading Von Misers writings.  The web page I use is:-  http://mises.org/

The big mistake has been political interfearance in economic systems.   Making cheap money etc.   There needs to be more regulation on controlling the crooks (read banks) and less on free trade.  IM*very*HO


----------



## bandicoot76 (26 April 2011)

tothemax6 said:


> Hah, really? Now you are going to pose as an objectivist?
> 
> This thread is one big pile of WTF.




i cant stay john galt, i tried but cant! posts like this are what really annoy me and make me feel compelled to respond, even though i know my response will only lead to more inane comments!

to answer your post.. i 'pose' as nothing... i am forthright about the stereotype that best defines me... described best as 'jeffersonist libertarian'... AYN RAND was an  objectivist yes, but she was primarily a libertarian, with slightly different views & opinions but on the same track, as was murray rothbard, again slightly different views but at heart a libertarian!

[rothbard] also considered central banking and fractional reserve banking under a monopoly fiat money system a form of state-sponsored, legalized financial fraud, antithetical to libertarian principles and ethics.]

your brain must be so conditioned to thinking that things can only be "this way" or "that way" that you cannot comprehend that in reality it can be a combination of a little bit of both, with a pinch of something else thrown in the mix for good luck! 

text books can only take you so far its real life (human) experience that provides you with the really important stuff!


----------



## professor_frink (26 April 2011)

Uncle Festivus said:


> Well, yes. That's the whole point of the government 'stepping up to the plate' and filling the hole left by non spending private sector, only it is leaving a huge government debt behind, and no certainty that the 'recovery' is self sustaining. In fact the latest data suggest it is not ie Philly Fed Manufacturing Index just plunged from 43 to 18! Company margins are non existent.
> 
> The problem will be, when this is realised, that they (the US Fed etc) will have spent all the ammo already with QE and will therefore have no choice but to make the hard choices ie cut spending ie pretty much everything really.
> 
> ...




The philly fed is a pretty noisy data series month to month, you really can't read too much into it. Even with that massive plunge last month, it's still a positive reading, meaning expansion, and is still above the median reading for expansion periods over the past 40 years. You can get a good run down on it  here if you are interested:

http://www.calculatedriskblog.com/2...mpaign=Feed:+CalculatedRisk+(Calculated+Risk)

In regards to the US having already used up it's "ammo" already, I don't really agree. America isn't Greece(or any of the other Euro countries that have given up control of their currencies and monetary policy). Their financial ammunition is essentially limitless.

Any austerity measures they undertake before the recovery is fully taken care of will be solely a political choice, not one that is forced on them as you seem to be implying.


----------



## bandicoot76 (26 April 2011)

explod said:


> One only has to look at the 20 year chart of the Dow and it can be seen where recoveries (dot.com etc.) are rebuilt on the release of low interest money and now of course no interest money.




someone recently attempted to label me as a lunatic (ie insane). my father in law is a psychologist and one of his definitions of insane is "doing the same thing over and over and expecting a different outcome/result"  

dont you think, after looking at the past history of the dow, that it must be the ppl in charge of the monetery system who are insane as this is PRECISELY what they have been doing repetitivly for years... using the same control methods (inflation/deflation) over and over to try to control the financial system then acting suprised when it doesnt work?


----------



## Frank D (26 April 2011)

IB12 said:


> If you think technical analysis has explained the AUD/USD rate going from 90c to $1.07 you're kidding yourself.




*Technical Analysis might not be the reason, but it helps….*



Frank D said:


> My view is a potential 3rd week reversal pattern (next week)… I think AUD will continue to trend upwards and break parity later thisyear and then into higher highs in 2011….
> 
> But the most robust trending pattern (after reaching .9979) is to see
> the market reverse down and then continue higher from November's
> 50% level towards higher highs in the first Quarter for 2011 *(14th October)*




AUD reversed down the following week and then found support at the
 November 50% levels.



Frank D said:


> Technically, the primary cycles won’t be confirmed until the end of 2010, but already the price action in November and the 4th Quarter suggests
> more gains into higher highs in 2011 *(5th November 2010)*





AUD found support at the November 50% levels .9546 and has continued towards 
new highs into 2011.



Frank D said:


> my expectation is that the
> trend will continue towards higher highs in 2011 :- $1.0612 *(8th January 2011)*




1.0612 was reached last week, as the USD moves down towards it's own 2011 lows.

all quotes taken from AUD/USD thread.....


----------



## bandicoot76 (26 April 2011)

Uncle Festivus said:


> Under 'the plan' the assumption is that income from personal tax will (needs to) grow by over 50% over the period allowed for the deficit to be contained. QUOTE]
> 
> if this 50% increase in personal tax happens you will DEFINATELY see some serious "going john galt" happen!


----------



## professor_frink (26 April 2011)

explod said:


> It is my take that there has been no recovery.  Not of substance anyway.  Q/e by money creation from thin air is not a recovery.
> 
> 
> One only has to look at the 20 year chart of the Dow and it can be seen where recoveries (dot.com etc.) are rebuilt on the release of low interest money and now of course no interest money.
> ...




Just on the QE comment explod, QE hasn't really created any new money IMO, all it's done is create a bucketload of excess reserves in the banking system. Whilst the fed is paying interest on excess reserves, it's most likely going to stay that way too.

What do you mean by this comment:



> Unless value goes back to a measure of physical output (which is the real GDP) there will be no recoveries.


----------



## Aussiejeff (26 April 2011)

bandicoot76 said:


> someone recently attempted to label me as a lunatic (ie insane). my father in law is a psychologist and one of his definitions of insane is _"doing the same thing over and over and expecting a different outcome/result" _
> 
> dont you think, after looking at the past history of the dow, that *it must be the ppl in charge of the monetery system who are insane as this is PRECISELY what they have been doing repetitivly for years... using the same control methods (inflation/deflation) over and over to try to control the financial system then acting suprised when it doesnt work?*




That's the sanest summation of the monkeys tinkering with this brave new world's financial bananas that I've seen for quite some time... :bananasmi


----------



## explod (26 April 2011)

professor_frink said:


> What do you mean by this comment:
> 
> "Unless value goes back to a measure of physical output (which is the real GDP) there will be no recoveries."




My Marxist bent "A fair(productive)  days work for a fair (and equal) days pay"   or, not making money by going short in a falling property market for example.  Or money being made from nothing, or that's how it seems to me..


----------



## tothemax6 (26 April 2011)

bandicoot76 said:


> someone recently attempted to label me as a lunatic (ie insane). my father in law is a psychologist and one of his definitions of insane is "doing the same thing over and over and expecting a different outcome/result"



Lucky you, this must cut down on your treatment costs .
OK maybe your not insane, but 'excessively excitable', if you will.  


professor_frink said:


> Just on the QE comment explod, QE hasn't really created any new money IMO, all it's done is create a bucketload of excess reserves in the banking system. Whilst the fed is paying interest on excess reserves, it's most likely going to stay that way too.



The theory that this money is simply being sat in banks, to keep them comfortable, and is not 'entering circulation', and will be withdrawn from the banks when they are comfortable - has issues. 
Firstly, on the evidence side, from where is the money coming to cause the huge rise in the s&p500? From where is the money coming to bid up the price of commodities (across the board) to these levels? Why are Chinas USD reserves ballooning, as they maintain their loose peg? I suspect those funds are being lent out by banks - that's how they make money after all.

Secondly, how does the fed create these reserves? The fed purchases government debt (lends the money to the government). The government spends this straight away, effectively putting the fresh money straight into the markets. What happens when people have received this money, and put it in their bank accounts (increasing the banks reserves), is secondary.


----------



## bandicoot76 (26 April 2011)

tothemax6 said:


> Lucky you, this must cut down on your treatment costs .
> OK maybe your not insane, but 'excessively excitable', if you will.
> .




i am passionate about my freedom, & maintaining it free from encroachment by all parasites, and consider anyone who trys to inhibit that freedom as an enemy 

if you consider that to be 'excessively excitable' thats your opinion... at least i have the heart & passion to stand up for what i believe in... whats your passion? baiting people who have real passions & heartfelt beliefs because you have none of your own? 

snideness & sarcasm doesnt = intelligence in my book!


----------



## bandicoot76 (26 April 2011)

tothemax6 said:


> The theory that this money is simply being sat in banks, to keep them comfortable, and is not 'entering circulation', and will be withdrawn from the banks when they are comfortable - has issues.
> Firstly, on the evidence side, from where is the money coming to cause the huge rise in the s&p500? From where is the money coming to bid up the price of commodities (across the board) to these levels? Why are Chinas USD reserves ballooning, as they maintain their loose peg? I suspect those funds are being lent out by banks - that's how they make money after all.
> 
> Secondly, how does the fed create these reserves? The fed purchases government debt (lends the money to the government). The government spends this straight away, effectively putting the fresh money straight into the markets. What happens when people have received this money, and put it in their bank accounts (increasing the banks reserves), is secondary.




the first decent post of substance without malice from you on this thread.... congratulations!


----------



## bandicoot76 (26 April 2011)

words of wisdom that have fallen on deaf ears:


"The end of democracy and the defeat of the American Revolution will occur when government falls into the hands of lending institutions and moneyed incorporations." 
”” Thomas Jefferson

"To preserve our independence, we must not let our rulers load us with perpetual debt. We must make our election between economy and liberty, or profusion and servitude." 
”” Thomas Jefferson

"If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that grow up around them will deprive the people of all property until their children wake up homeless on the continent they conquered." 
”” Thomas Jefferson

"A wise and frugal government which shall restrain men from injuring one another, which shall leave them otherwise free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned. This is the sum of good government." 
”” Thomas Jefferson


----------



## professor_frink (27 April 2011)

explod said:


> My Marxist bent "A fair(productive)  days work for a fair (and equal) days pay"   or, not making money by going short in a falling property market for example.  Or money being made from nothing, or that's how it seems to me..




ok then I see where you are going now. You might find the chart below interesting. Comments that the US doesn't actually make anything anymore isn't entirely true and just a little exaggerated. It's not exactly growing at a rapid clip at the moment, but the country is still a long way away from not actually making anything.


----------



## professor_frink (27 April 2011)

tothemax6 said:


> The theory that this money is simply being sat in banks, to keep them comfortable, and is not 'entering circulation', and will be withdrawn from the banks when they are comfortable - has issues.
> Firstly, on the evidence side, from where is the money coming to cause the huge rise in the s&p500? From where is the money coming to bid up the price of commodities (across the board) to these levels? Why are Chinas USD reserves ballooning, as they maintain their loose peg? I suspect those funds are being lent out by banks - that's how they make money after all.




A couple of charts that might help:

Firstly, monetary base and excess reserves:




There may be some leakage out of the banking system(I don't have exact figures, just grabbed the chart from a website), but for the main part they are moving together here.

The idea that the S&P 500 and commodity rally is evidence that this is happening doesn't make any sense IMHO. Chart below is the SPX highlighting where it was first announced and where it began:




Note on the chart the announcement of QEII led to a 15%+ rise in the S&P. Since it actually began, the S&P has risen roughly 10%(chart is a couple of days old but you get the idea)



tothemax6 said:


> Secondly, how does the fed create these reserves? The fed purchases government debt (lends the money to the government). The government spends this straight away, effectively putting the fresh money straight into the markets. What happens when people have received this money, and put it in their bank accounts (increasing the banks reserves), is secondary.




When the fed wants to buy bonds, they just go ahead and do it, and then credit the banking system with excess reserves. It's pretty well that simple. Bernanke explained this in a Q&A he gave last November at Jacksonville University. You can watch it here if you want:

http://www.c-span.org/Events/Fed-Ch...iversity-Students-on-Monetary-Policy/19670-1/

Around the 19 minute mark he explains it.

EDIT: just found  the piece of the discussion I was talking about:



> “What the purchases do… is… if you think of the Fed’s balance sheet, when we buy securities, on the asset side of the balance sheet, we get the Treasury securities, or in the previous episode, mortgage-backed securities. On the liability side of the balance sheet, to balance that, we create reserves in the banking system. Now, what these reserves are is essentially deposits that commercial banks hold with the Fed, so sometimes you hear the Fed is printing money, that’s not really happening, the amount of cash in circulation is not changing. What’s happening is that banks are holding more and more reserves with the Fed. Now the question is what happens the economy starts to grow quickly and it’s time to pull back the monetary policy accommodation. There are several tools that we have”


----------



## konkon (27 April 2011)

Another rally on Wall Street. But why? They are really living in a world of their own. Quantitative Easing, and yes, even the thought of QE (before it actually happens) was/is positive for stocks. But there is no word yet of whether there will be another QE (or something equivalent). Tonight's Fed 'press conference' might give us some indication as to what the Fed might do in the foreseeable future. 

All this kind of reminds me of one of the best films ever made, The Wizard of Oz in 1939, where Dorothy and her friends went to see the Wizard himself with all the hype and expectations of having their problems solved, only to be disappointed to find that the Wizard was nothing more than an old guy frantically trying to control machines, levers, strings etc. 

Going back to QE or the Fed's thoughts. The removal of QE might mean that the Fed might not back Wall Street's thirst for more. So why would the rally continue? Why did they rally last night when we might be at some crossroads?

No matter what is suggested or said tonight, it will all be forgotten in a week. It will be up to the current or next President to move things in the 'right' direction. I see no real easy fix by the Wizard tonight.

I wonder if the Fed will lay some of the blame at China? A possible interest rate move up and more than 25 basis points in the foreseeable future? Disastrous for stock markets and his Wall Street mates will once again dislike him. But I can see Bernanke raving-on about what the Fed does technically and hypnotising us with his fancy terms and spin.


----------



## professor_frink (27 April 2011)

konkon said:


> Another rally on Wall Street. But why? They are really living in a world of their own. Quantitative Easing, and yes, even the thought of QE (before it actually happens) was/is positive for stocks. But there is no word yet of whether there will be another QE (or something equivalent). Tonight's Fed 'press conference' might give us some indication as to what the Fed might do in the foreseeable future.
> 
> All this kind of reminds me of one of the best films ever made, The Wizard of Oz in 1939, where Dorothy and her friends went to see the Wizard himself with all the hype and expectations of having their problems solved, only to be disappointed to find that the Wizard was nothing more than an old guy frantically trying to control machines, levers, strings etc.
> 
> ...




konkon,

your posts don't make any sense whatsoever. What on earth are you trying to say here


----------



## konkon (27 April 2011)

professor_frink said:


> konkon,
> 
> your posts don't make any sense whatsoever. What on earth are you trying to say here




Of course they make sense.


----------



## Smurf1976 (27 April 2011)

professor_frink said:


> ok then I see where you are going now. You might find the chart below interesting. Comments that the US doesn't actually make anything anymore isn't entirely true and just a little exaggerated. It's not exactly growing at a rapid clip at the moment, but the country is still a long way away from not actually making anything.



I personally wouldn't consider "utilities" to be a form of manufacturing. Technically I suppose a power station is a factory, but it doesn't really fit with what most would think of in terms of manufacturing and there's little direct international trade in electricity (though there's a lot of indirect trade via the choice of location for smelters etc).

I make this point because with utilities included, Americans buying Chinese plasma TV's would be pushing up the "manufacturing" figures simply by using more electricity.


----------



## professor_frink (27 April 2011)

Smurf1976 said:


> I personally wouldn't consider "utilities" to be a form of manufacturing. Technically I suppose a power station is a factory, but it doesn't really fit with what most would think of in terms of manufacturing and there's little direct international trade in electricity (though there's a lot of indirect trade via the choice of location for smelters etc).
> 
> I make this point because with utilities included, Americans buying Chinese plasma TV's would be pushing up the "manufacturing" figures simply by using more electricity.




Point taken Smurf, though the main reason for this chart using it is due to the Chinese data coming out this way. I know the 2008 data didn't have manufacturing data separated from the mining and utility data, most analysis I saw on it simply used the % of manufacturing to manufacturing, mining and utilities data to try and estimate the growth in manufacturing for that year. This one has gone a slightly different way and just added on mining and utilities for other countries to complete the picture.

Overall, if you include that data or not, the end result is still the same as far as I'm aware, though happy to be corrected by anyone who has access to the data.


----------



## professor_frink (27 April 2011)

konkon said:


> Of course they make sense.




I'm glad they make sense to someone then!


----------



## konkon (27 April 2011)

professor_frink said:


> I'm glad they make sense to someone then!




 Re: SILVER
"Personally I think the Silver story is just as much about rampant speculation these days as USD weakness"  from professor_frink

professor_frink, your comments don't make sense. Are you aware of what is going on in the US, Europe etc?


----------



## professor_frink (27 April 2011)

konkon said:


> Re: SILVER
> "Personally I think the Silver story is just as much about rampant speculation these days as USD weakness"  from professor_frink
> 
> professor_frink, your comments don't make sense. Are you aware of what is going on in the US, Europe etc?




yes.


----------



## konkon (27 April 2011)

professor_frink said:


> yes.




Really?


----------



## professor_frink (27 April 2011)

konkon said:


> Really?




yes


----------



## bandicoot76 (27 April 2011)

looking around the world at the moment, and being an avid 'student of history' i have pondered alot on how things got to this point, one of the conclusions i have reached i will share with you now and value any CONSTRUCTIVE feedback... i know it is more philosophical than financial/economic but i still feel its relevant to this thread:

"people today are so caught up in the LEFT (socialist) Versus RIGHT (capitalist) paradigm that they cannot look outside the square and see that it is a totally misleading & bogus situation that is being manipulated and controlled by an unseen third party, who is neither the working class, middle class, nor the business/upper class but who i shall name as the parasite 'authority'  class 

it is my belief that the 'workers' (L) V's the 'bosses' (R) situation was created by Karl Marx & Co as a bastardisation of a previous concept, that being the situation of 'the people' versus 'the authority' (wether it be aristocratic, beaurocratic, democratic or religious rule)

by changing this power-balancing status to 'the workers' V's 'the bosses' it allowed 'the authority' of the future (in whatever form) to go about the business of ruling (and whatever else took their fancy) free of interuption while 'the people', both workers and bosses, were divided, to busy squabbeling over an issue that could be solved by one sentance: 'a fair days work for a fair days pay!'

surely this is evident when we compare the two worst leaders in modern history.. hitler and stalin... both butchered millions of innocent people for no reason comprehensible to a sane person, both claimed to be 'the father' of their respective peoples, one claimed to represent the Left... the other the Right however in my opinion neither one did... i believe in reality they were both representitives a new 'hidden' class the elitest parasite 'authority' class! THEY WERE BOTH EXACTLY THE SAME JUST DRAPED IN DIFFERENT SYMBOLS OF POWER!

an interesting by-note is that both despots war-chests were also financed from the same banking organisations that funded the "western" war effort!"


----------



## explod (28 April 2011)

I think its past the time of looking at all the charts and the so called (in my head) fancy stuff. 

We have unprecedented riots across the globe by people who have been marginalised and exploited.  And Buddhism for example is merely a symptom of deprevation and a lack of opportunity.  Put a dollar in a pocket and give a lad meaningful and productive job and it would all in my view go away.

I get this gut feel that the markets are going to explode down soon and they wont give it a GFC number , it will be "The Armageddon".  

Dan Norcini posted up the following quote of Karl Marx today which brought me back to our discussions here and my rant above:-

"Owners of capital will stimulate the working class to buy more and more of expensive goods, houses and technology, pushing them to take more and more expensive credits, until their debt becomes unbearable. The unpaid debt will lead to bankruptcy of banks, which will have to be nationalized, and the State will have to take the road which will eventually lead to communism. (Das Kapital, 1867)

See;-  http://traderdannorcini.blogspot.com/


----------



## qldfrog (28 April 2011)

konkon said:


> Of course they make sense.




Konkon and prof: I am really open to get some views there but maybe with a bit more details and less personal attack?
konkon, seriously, what did you want to express?
I got lost as well: I agree with some of your points but ?


----------



## tothemax6 (28 April 2011)

explod said:


> Dan Norcini posted up the following quote of Karl Marx today which brought me back to our discussions here and my rant above:-
> 
> "Owners of capital will stimulate the working class to buy more and more of expensive goods, houses and technology, pushing them to take more and more expensive credits, until their debt becomes unbearable. The unpaid debt will lead to bankruptcy of banks, which will have to be nationalized, and the State will have to take the road which will eventually lead to communism. (Das Kapital, 1867)



Yes, yes, 'exploiting the proletariat' etc etc. Marx should be out of favour by now, and maybe one day (hopefully), Keynes too.
Marx was simply molding the phenomenon of the credit-expansion fueled boom-bust cycle into his (highly warped) economic views. 
We already have nationalized banking (state money, state central bank - which was Marx's 5th recommendation in the 'Communist Manifesto' for practical application of communism), and it allows for monster bubbles and inflation.


----------



## bandicoot76 (28 April 2011)

explod said:


> I think its past the time of looking at all the charts and the so called (in my head) fancy stuff.
> 
> We have unprecedented riots across the globe by people who have been marginalised and exploited.  And Buddhism for example is merely a symptom of deprevation and a lack of opportunity.  Put a dollar in a pocket and give a lad meaningful and productive job and it would all in my view go away.
> 
> ...




i think you and i are on similar pages, however you are still stuck in the bogus L Vs R paradigm that is dividing the people, turning them against each other and in doing so losing focus of the real villians of the peice, that being the hidden parasitic elite "authority" that includes the global banking cartels, government beauracracies etc... it is a case of the 'PARASITE ELITE' VERSUS 'THE PRODUCTIVE SECTOR' rather than 'THE WORKERS' VERSUS 'THE BOSSES' in my opinion.


----------



## Uncle Festivus (29 April 2011)

I'm not sure what this chart means or implies for the future? Must go and get a haircut... woops, I'm not a US bank 

Once apon a time there was 'mark to market', now it's 'don't ask & we won't tell'......


----------



## explod (29 April 2011)

bandicoot76 said:


> i think you and i are on similar pages, however you are still stuck in the bogus L Vs R paradigm that is dividing the people, turning them against each other and in doing so losing focus of the real villians of the peice, that being the hidden parasitic elite "authority" that includes the global banking cartels, government beauracracies etc... it is a case of the 'PARASITE ELITE' VERSUS 'THE PRODUCTIVE SECTOR' rather than 'THE WORKERS' VERSUS 'THE BOSSES' in my opinion.




Agree and well put. 

Rothschildsrokerfellas et al.


----------



## tothemax6 (30 April 2011)

Uncle Festivus said:


> I'm not sure what this chart means or implies for the future? Must go and get a haircut... woops, I'm not a US bank
> 
> Once apon a time there was 'mark to market', now it's 'don't ask & we won't tell'......
> 
> View attachment 42620



Yes, it amazes me that the Fed was this loose. Its not 'tightening' if the interest rate rises are not causing credit expansion to slow. Its almost like they _wanted _to create a bubble. This ridiculous rate of credit expansion is a perfect example of the failure of central banking. 
As far as the future goes, well. After the tech bubble, the fed dropped cash rates to 1%. That's as loose as the fed got. This time round they forced cash rates to 0%, and printed so much money you'd think they were printing newspapers.

I don't see any light at the end of the tunnel for the US.


----------



## Aussiejeff (30 April 2011)

tothemax6 said:


> I don't see any light at the end of the tunnel for the US.




I do.

It's called a "bondfire".


----------



## Uncle Festivus (30 April 2011)

professor_frink said:


> In regards to the US having already used up it's "ammo" already, I don't really agree. America isn't Greece(or any of the other Euro countries that have given up control of their currencies and monetary policy). Their financial ammunition is essentially limitless.
> 
> Any austerity measures they undertake before the recovery is fully taken care of will be solely a political choice, not one that is forced on them as you seem to be implying.




Yes, it will be forced on them by bond buyers and the so called debt ceiling, (among other things like unfunded liabilities), which really is just another name for the yearly debt 'limit up'. So when they increase it another trillion or so where will that come from? What will they do with it? There just isn't any political will whatsoever to take the tough actions required to avert a debt default sometime in the future, so called 'recovery' or not, worlds 'default currency' or not?

Now a bit about the GDP & how the government 'manipulates' it. This bit is in John Mauldins latest piece and explains it well.

http://www.johnmauldin.com/frontlinethoughts/the-endgame-headwinds



> [FONT=Arial, Helvetica, sans-serif]GDP = C + I + G + net exports, or GDP is equal to Consumption (Consumer and Business) + Investment + Government Spending + Net Exports (Exports – Imports). This is true for all times and countries.
> 
> ___________
> [/FONT][FONT=Arial, Helvetica, sans-serif]
> ...



[FONT=Arial, Helvetica, sans-serif]

[/FONT]


----------



## Aussiejeff (30 April 2011)

Uncle Festivus said:


> Yes, it will be forced on them by bond buyers and the so called debt ceiling, (among other things like unfunded liabilities), which really is just another name for the yearly debt 'limit up'. So when they increase it another trillion or so where will that come from? What will they do with it? There just isn't any political will whatsoever to take the tough actions required to avert a debt default sometime in the future, so called 'recovery' or not, worlds 'default currency' or not?
> 
> Now a bit about the GDP & how the government 'manipulates' it. This bit is in John Mauldins latest piece and explains it well.
> 
> ...




The bottom dashed lines that display the yawning gap between Fed receipts and outlays in the last few years looks like a bayou alligator about to snap it's jaws shut! 

Then, I looked left and LO! The same situation was apparent in the final years of WW2 (44-45). Hmmm. Is this an omen? 

A little research shows punishing US & UK austerity programs ran from 1947-50 to reign in the runaway wartime expenditure - the "austerity" period on the graph is where the Fed actually ran a rare surplus (the only other period appears to be circa 1997-2002).

Hmmm...


----------



## professor_frink (2 May 2011)

Warren Buffett has weighed in on this discussion between myself and UF a little too. Full article can be found here:

http://www.cnbc.com/id/42836791



> Warren Buffett says if Congress fails to raise the U.S. debt limit, it would be its "most asinine act" ever.
> 
> But he told shareholders today there's "no chance" lawmakers will fail to do so, despite "waste of time" debates on Capitol Hill.
> 
> ...


----------



## tothemax6 (2 May 2011)

Yes now Buffet is on the 'Its OK, we have a printing press' bandwagon. 
No, its not OK Buffet, its OK for you. Unlike you, most peoples primary asset is cash and primary source of income is a cash wage. Inflation is good for you because your assets prices and dividends will increase.
A##hole.


----------



## bandicoot76 (2 May 2011)

tothemax6 said:


> Yes now Buffet is on the 'Its OK, we have a printing press' bandwagon.
> No, its not OK Buffet, its OK for you. Unlike you, most peoples primary asset is cash and primary source of income is a cash wage. Inflation is good for you because your assets prices and dividends will increase.
> A##hole.




haha, thats what i like to see... a bit of passion! next thing you'll be using capslock to try to emphasize the point your trying to make! :


----------



## konkon (3 May 2011)

I wonder if institutions etc will end up buying more and more protection in the form of precious metals and other commodities in the coming months and even next year? 

The stock market in the US has risen a fair bit in the past year (and past few years), but in dollar terms, relative to other currencies etc, what would be the US stock market's net gain (or loss)? If you're off to Vegas with the profits, great. But if corporations need to trade with other nations (and this is what they do) with stronger currencies etc, then you have a problem. 

US Corporations (and even Australian companies like BHP that trade with USDs) will have to hedge against these market dynamics and there could be more protection-buying (buying inverse related commodities etc) in the future. 

If the US didn't have such a debt crisis (that pretty much can't be solved with current methods) then the commodity play would eventually be dead in the water. But commodities and other currencies will continue to appreciate over the next year or so given the unyielding position the US finds itself in.


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## konkon (5 May 2011)

Good to see the US going after speculators and the like (futures traders etc) by increasing the margins on futures trading contracts. Just goes to show how powerful the US really is when it wants to be. A commodity take-down in the making? An interesting year ahead.

I still think the USD's devaluation over the long term will mean commodities will appreciate in the future. BUT one shouldn't stand in the way of a giant. Imagine if the US got desperate and wanted to really move the markets one way or the other? Hard to know what to own and what to sell if we went through this again.


----------



## konkon (6 May 2011)

What a week! First that @#%#$#!@##$ in Pakistan and then those speculators that have caused a lot of problems around the world. The US (military, Obama etc etc) has done an amazing thing by fighting back on all fronts. This is the sort of thing that amazed me about Ronald Reagan. Republican, Democrat or whatever else, this is the right way forward. Partisan politics in congress is not. 

Speculators might well be priced-out of their own futures trading environments/platforms (they've done a fair bit of pricing-out themselves). To hit silver speculators twice in a week with an increase in future contracts is, in my opinion, a deliberate and calculated move to go after speculators in general. Those birds of a feather will flock together, whether it be high or low. And they will not win Obama a next term or help get the US out of the #@#$%$ they're in.

The move this week on the markets is more than just a glitch or a correction. This is the US 'telling' all those that are betting against the United States economy and USD (and I do this occasionally myself) that the US doesn't like having its back against the wall for too long. 

The US will not give up its dominance of world markets and its status as the reserve world currency. I don't really include many on Wall Street as they aren't as concerned about a strong USD, for example. By the US, I mean high level government officials (Obama etc), the military, CIA, NSA, FBI etc etc. Wall Street will be made to play along. So will the Federal Reserve and there is mounting pressure on it to reform itself. 

I can't help thinking that Obama etc and those in charge of the futures exchange and other key players planned this move to go after speculators. This was not a 'normal' correction this week. I thought we might have this later on, from July onwards (and maybe even next year). But the US administration must be feeling like their backs are against the wall and it was time to go after those that were feeding-off a struggling USD and economy. 

I do take my hat off to Obama this week. This is an exceptional effort by the military etc, Obama and others on two major fronts. Many were betting that the US administration would just sit there and not do anything about futures trading practices. But, for now, they went after them head-on and have won this round.

I wonder if the ECB was in on this speculator take-down, by suggesting that the ECB will not raise rates any time soon? Perhaps not, but it wouldn't surprise me.


----------



## professor_frink (6 May 2011)

konkon said:


> Re: SILVER
> "Personally I think the Silver story is just as much about rampant speculation these days as USD weakness"  from professor_frink
> 
> professor_frink, your comments don't make sense. Are you aware of what is going on in the US, Europe etc?




Still think they don't make sense?


----------



## konkon (6 May 2011)

professor_frink said:


> Still think they don't make sense?




This is a commodity take-down and if the authorities didn't step in to make silver contracts more expensive you would have silver continuing to go higher, with some corrective periods.  

Many investors are not convinced that the USD won't go into hyperinflation in the future sometime. I don't believe it will, but there are plenty that do. So the silver trade is not just about speculation. It was about protection buying against a falling USD. This trade will come back later on, but perhaps, not for a while.


----------



## konkon (6 May 2011)

I do believe the end of QE2 and the lack of a QE3 will be disastrous for stocks, overall. The decision to, or not to, implement a QE3 (or something just like it) is perhaps the most important one of the year (and one I'm really anticipating). 

I feel like the decision this week to 'price-out' many futures traders is:

1. a coordinated effort by Obama (indirectly) and his very powerful associates to try and get a grip on (or try and get their heads around) things, before other perhaps more extreme measures are implemented. 

2. a warning to others involved in speculating on inversely related commodities, currencies etc (to the USD) that more counteractive measures will be incorporated if needed. 

3. the United States pretty much showing who still controls markets (debatable, like everything I've posted, but I believe this).

4. testing the waters with other agencies, like the Federal Reserve, to see who is with us! The Obama Administration might be checking to see what changes it needs to do (maybe after the next election, if it gets in). *

5. the first of many (surprise) moves or 'attacks' on those that don't see eye-to-eye with long-term US economic interests. I bet there will be more surprises and not just for US investors. 

I also don't think Obama needs Wall Streets support like other Presidents might have, this time round. He needs the support of the middle class. Obama might have the Fed on notice, and I think Bernanke is feeling this a little. I think Bernanke will gravitate towards the Obama Administration more than Wall Street this time round. But it won't be official, of course, like most of the points raised by me above. 

Does Bernanke's 'transitory inflation' comments last week mean that he knew about the effort to reign-in speculation in commodities? Did the ECB's decision yesterday to not raise European interest rates in the foreseeable future (which took many by surprise), mean that the ECB is part of this coordinated effort to reign-in speculation in futures markets? We won't be told officially, but I think there is a very good chance that this (all of the above) is the case. 

* (The attacks on the Libyan government also tested the waters a little too; to see which countries were with the allied US and European nations).


----------



## LifeChoices (6 May 2011)

konkon said:


> I do believe the end of QE2 and the lack of a QE3 will be disastrous for stocks, overall. The decision to, or not to, implement a QE3 (or something just like it) is perhaps the most important one of the year (and one I'm really anticipating).
> 
> I feel like the decision this week to 'price-out' many futures traders is:
> 
> ...




I can't believe you are continuing to banging on about this stuff. Why bother - what's your motive? - are you trying to educate the dumb masses?

If not why not just bunker down in some hole somewhere and shut up and let the rest of us morons cope with impending doom.


----------



## explod (6 May 2011)

LifeChoices said:


> I can't still believe you are banging on about this stuff. Why bother - what's your motive- are you trying to educate the dumb masses?
> 
> If not why not just bunker down in some hole somewhere and shut up and let the rest of us morons cope with impending doom.




Some of us morons find konkon's post very informative indeed.  All views make the picture.


----------



## tothemax6 (6 May 2011)

Ugh, I simply must be drawn back into this thread to try and understand the age old question "What the hell, man?".

'This is a commodity take-down'? What in gods name is that? 'Good to see the US going after speculators'? Why on earth is that a good thing?

Bernanke has been wrong about everything he has ever said. His 'transitory inflation' statement simply springs forth from the same fountain of Keynesian-flavoured jibberish. 
Speculation does not cause inflation, but inflation may cause speculation. In a bubble, the speculators still need to obtain the money and credit required to make their ever-larger purchases. If the money and credit supply remains constant, any funds funneled into a particular asset must be drawn *out* of another - hence no net inflation. As Friedman said 'Inflation is, and always has been, a monetary phenomenon'. Inflation is produced by credit expansion, which is fueled by an expanding monetary base.

Speculation, or 'trading', is the means by which prices are set in a market. When a speculator buy's wheat futures because he thinks a shortage is coming on, he is doing no different to a farmer who plants more wheat, or a baker who stockpiles more flour in anticipation of the higher prices. Indeed, if speculators are correct - which they need to be to be profitable, they force the price up more quickly - increasing the rate at which farmers produce wheat. That is how a market works. Speculation is good.


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## tothemax6 (6 May 2011)

Aussiejeff said:


> I do.
> 
> It's called a "bondfire".



Sorry, I missed this. Very clever .


----------



## kingcarmleo (10 May 2011)

USD is simply too powerful (not in price but quantity and usage) for it to be "destroyed". Get a strong feeling china are trying to change this though.


----------



## tothemax6 (10 May 2011)

kingcarmleo said:


> USD is simply too powerful (not in price but quantity and usage) for it to be "destroyed". Get a strong feeling china are trying to change this though.



Not really, there is a long list of nations that were once powerful, and now either don't exist, or no longer have significance on the world stage.
Portugal used to be the world's foremost imperial and naval power, for instance. The Mongols had an empire that stretched from Europe to china. Both are now irrelevant nations. The ancient romans, greeks, egyptians etc all no longer exist, replaced by new nations.

Either the US is engaged in self-sustaining, constructive behaviour, or it is engaging in self-destructive behaviour. People forget that the power the US has _came from somewhere_, and if that source has gone, the power will wilt.


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## Caveman (12 May 2011)

Yea the Mongols succeeded where the germans and french failed.
They successfully sacked Moscow in Wintertime.


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## konkon (12 May 2011)

Just have a look and see what a commodity take-down might look like. The US still controls the world's markets and is giving us a glimpse of what it can do in such a short amount of time. Imagine if it got serious and desperate? Another reason why the USD will continue to be the reserve currency.


----------



## tothemax6 (12 May 2011)

konkon said:


> Just have a look and see what a commodity take-down might look like. The US still controls the world's markets and is giving us a glimpse of what it can do in such a short amount of time. Imagine if it got serious and desperate? Another reason why the USD will continue to be the reserve currency.



OK if your up for it, lets discuss just this point.

What is a 'commodity take-down'? How can the US possibly depress commodity prices whilst simultaneously expanding the money supply, without magically increasing the supply of commodities, or magically reducing peoples demand for commodities?
And what does this have to do with 'reserve currencies'?


----------



## stacks (12 May 2011)

tothemax6 said:


> OK if your up for it, lets discuss just this point.
> 
> What is a 'commodity take-down'? How can the US possibly depress commodity prices whilst simultaneously expanding the money supply, without magically increasing the supply of commodities, or magically reducing peoples demand for commodities?
> And what does this have to do with 'reserve currencies'?




repeated margin increases on silver did some damage.... its a commodity and has been taken down (and up again by the faithful) but then down again. 

For example...


----------



## stacks (12 May 2011)

and also ....

release a statement confirming end of the 2nd round of US monetary printing (denoted via the now far too well known symbol of QE) thereby 'reducing' the global increase in credit that has been keeping these commodity prices well above average.......

aaaaaand release a torrent of information regarding Greeces issues e.g. '(untrue) breakway potential' , haircuts etc, Finlands reluctance, future proposals for potugal to hock the country -

all of which have smashed the euro - USD up 

aaaaaand at the same time reducing 'speculator' participation by increasing margins... 

aaaaand therefore commodities down.

Granted there are other factors at work here but the above have definitely 'taken down' the commodity price.


----------



## explod (13 May 2011)

stacks said:


> and also ....
> 
> release a statement confirming end of the 2nd round of US monetary printing (denoted via the now far too well known symbol of QE) thereby 'reducing' the global increase in credit that has been keeping these commodity prices well above average.......
> 
> ...




Well summarised stacks, as famously said a few years back by Robert Kyosaki of the US "cash is trash".

Notice their bond sale was was not well taken up overnight.  Who in thier right mind would take up a 30 year bond on almost zero interest.

The US dollar is going the same way as the Weimer republic where in the end a barrow load of notes would not even buy a meat pie.

http://nowandfutures.com/us_weimar.html


----------



## konkon (13 May 2011)

stacks said:


> and also ....
> 
> release a statement confirming end of the 2nd round of US monetary printing (denoted via the now far too well known symbol of QE) thereby 'reducing' the global increase in credit that has been keeping these commodity prices well above average.......
> 
> ...




This sums it up nicely, stacks. 

There are perhaps other methods in the pipeline too. Ones we haven't really predicted yet. I bet the margin hikes (on futures trading) on different types of commodities caught a lot by surprise. 

I can see Greece leaving the EU and setting-up its own currency in the future. I can also see them spending the loans big time and later saying "thanks, but no thanks". This marriage just didn't work-out for us. We're (Greece) are going back to the drachma and we will dust-off the printing precess and get back to controlling our own money (instead of going to the ECB for huge unpayable loans). Greece won't change its ways. A restructuring of its debt obligations will make no difference in the long run. They'll just ramp-up the debts later on too. 

Imagine Australia was part of a centralised Asian currency (had no control of the printing presses) and ran into a bit of (debt) trouble and had to go to a centralised Asian agency/bank for loans with (most likely) high interest rates. 

Greece with a cheaper drachma will sell more ships, olive oil and have robust tourism.


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## konkon (27 May 2011)

There are plenty of reports on the net (Youtube documentaries etc) on the 'inevitable' collapse of the USD. There are suggestions that as a result of this collapse commodities like silver and gold etc will go higher in value; protection buying from falling currencies etc. Their arguments seem plausible to some extent, but I think that a lot is overlooked. One being, what stops ,for example, margin requirements going higher and higher to buy commodities. You need to pay a 10% premium on silver futures contracts now. What would stop the US from implementing a 50% premium on buying some commodities if the USD was close to a premature collapse; a collapse being helped by synthetic measures and short selling pressures? This is the type of control the US has over world markets and another reason why the USD isn't going anywhere (collapsing) anytime soon. 

As strange as these sort of premium measures might seem, it might become an option (among many other we haven't thought of yet) if the US feels it needs to further protect its currency and economy. 

And if you think there is very little speculation going on in the commodity markets have a look at the Baltic Exchange Dry Index of commodities being shipped from country to country, below. This a non-speculative index of premiums on actual receipts on cross-county border movement of soft and hard commodities around the world. 

May of 2008 saw the hight of actual movements and a drastic drop prior to the GFC. Remember when oil and other commodities were at record highs in 2008? Haven't we recently revisited these highs in the past few months in most commodities? But why isn't this reflected in demand? There has to be an oversupply somewhere (stockpiled perhaps) and a hell of a lot of speculation. The index is at 1467 as of yesterday and its average on the premium paid based on actual receipts back in 2008 and before must have been past the 5000 level; the index went past 10,000 twice back then which would have justified the high energy and commodity prices back then. What justification do we have today? Goldman Sachs recommending we buy commodities again, because it suggests oil will hit $120 again? Didn't Goldman suggest we sell commodities last month? I guess it needs to make more somehow. I wonder how closely Goldman is being looked at these days by regulatory bodies that aren't looking the other way and really do give a stuff about the US economy?


----------



## tothemax6 (28 May 2011)

konkon said:


> Their arguments seem plausible to some extent, but I think that a lot is overlooked. One being, what stops ,for example, margin requirements going higher and higher to buy commodities. You need to pay a 10% premium on silver futures contracts now. What would stop the US from implementing a 50% premium on buying some commodities if the USD was close to a premature collapse; a collapse being helped by synthetic measures and short selling pressures? This is the type of control the US has over world markets and another reason why the USD isn't going anywhere (collapsing) anytime soon.



But it is not a 'premium'. It is a 'deposit'. If you want to buy a futures contract, the margin requirement is the percentage value of the contract you need to deposit with the exchange to open the position. However, this works both ways - all buyers of future contacts have traded with a seller of the futures contract. Sellers are also limited in the amount they can trade given the size of their deposit. 
Raising margin requirements does not in itself force the price in a particular way, but it can of course trigger a move in the price as certain agents close their positions to meet margin calls. Margin requirement increases a generally a 'calming' mechanism implemented by exchanges, since they reduce the size of the positions people can trade.


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## konkon (31 May 2011)

It does seem that the US and perhaps other nations are looking at ways to curb enthusiasm in many speculative markets, that are to some extent inversely related to the long term movements of the USD. One way of looking at this is to suggest that curbing speculator enthusiasm might artificially stabilise markets overall. If we look into the future, one possible outcome of this practice would be to control movements (or the lack of those movements) in nearly all markets. 

If, for example, the USD is nearing a premature collapse in the distant future, a strategy by those in charge of exchanges (and by those putting pressure from above!) might be to raise margins even further on trading all kinds of markets/platforms, to unprecedented and bizarre levels, so as to preserve the USD. 'Restrictions' like or kind of like this might include restrictions placed on trading other currencies too. Instruments to curb enthusiasm on inversely related products may not be in force today, but may be implemented in the distant future; in other words, we probably haven't even factored in other unique methods of counteracting the mass buying of other products, that are inversely related to the USD. 

Artificially propping-up and stabilizing markets is in force today, with for example, the quantitative easing rounds. Who would have thought of this three or so years ago. Imagine what other type of initiatives might be implemented in the next five to ten years.

On a separate note, I feel like we are living in a world where we are becoming more like pot plants than people who are free to swear at others if we feel the need to. Instead of telling us how to live our lives to an optimum degree, how about those in their ivory towers just turn to their window cills and water their pot plants. Hard to justify your job this way I guess.


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## professor_frink (31 May 2011)

konkon said:


> Artificially propping-up and stabilizing markets is in force today, with for example, the quantitative easing rounds. Who would have thought of this three or so years ago. Imagine what other type of initiatives might be implemented in the next five to ten years.




Quantitative easing isn't a recent thing, Japan first started doing it 10 years ago


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## tothemax6 (31 May 2011)

professor_frink said:


> Quantitative easing isn't a recent thing, Japan first started doing it 10 years ago



This is true professor. Perhaps the US will have its 2 lost decades also given that its doing the same thing and then some.

And as usual, I can't understand what konkon is talking about.


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## Uncle Festivus (2 June 2011)

QE1 & QE2 - the data is in, and the market has given it a big fat FAIL!

Is this what they get for several $TRILLION in debt funded economic stimulation? For several weeks now the various manufacturing data have plunged in unison, to the extent not to be statistical noise, rather a dramatic new trend - *a global double dip recession is imminent* only this time there won't be any more *bazookas* left in the armoury. 

The flow on now showing up in the markets -  The DOW - the surprising thing today was that there wasn't the 'set your clock by' last hour bid up by the Feds trading desks ie this was genuine selling brought about by just a small miss on the call for ADP Non-Farm Employment Change  - only 38k on a 177k guestimate!

Along with the other abysmal data - 




Wonder what QE3 will look like?


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## Uncle Festivus (2 June 2011)

konkon said:


> If, for example, the USD is nearing a premature collapse in the distant future, a strategy by those in charge of exchanges (and by those putting pressure from above!) might be to raise margins even further on trading all kinds of markets/platforms, to unprecedented and bizarre levels, so as to preserve the USD. 'Restrictions' like or kind of like this might include restrictions placed on trading other currencies too. Instruments to curb enthusiasm on inversely related products may not be in force today, but may be implemented in the distant future; in other words, we probably haven't even factored in other unique methods of counteracting the mass buying of other products, that are inversely related to the USD.




You are a bit behind the curve there KK....it's being done right now.

They already raised margins on all the counter trades to the $USD and the DOW ie look at the silver & commodities take down. But, not only that, they have just announced that they will reduce margins on equities! Now what do you think they are trying to do?

There are no real markets anymore - it's all a sham trying to prop up the dying corpse of failed capitalism..................


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## wayneL (2 June 2011)

Uncle Festivus said:


> There are no real markets anymore - it's all a sham trying to prop up the dying corpse of failed capitalism..................




I keep hearing references to the failure of capitalism.

Capitalism hasn't failed at all, it just hasn't been allowed to do its job. Recession is part of the business cycle, and when they started messing with the business cycle, they suspended true capitalism.

What we have now is a semi command and manipulated economy run by people who think they are smarter than the markets.

If capitalism is a dying corpse, it is not because it is trying to go into recession, it's dying because it has been intrinsically altered, leaving an almost unrecognizable franken-economy in its place.


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## Aussiejeff (2 June 2011)

wayneL said:


> I keep hearing references to the failure of capitalism.
> 
> Capitalism hasn't failed at all, it just hasn't been allowed to do its job. Recession is part of the business cycle, and when they started messing with the business cycle, they suspended true capitalism.
> 
> ...




Sorta like a half-dead heroin junkie who's life is inexorably ebbing away being prescribed massive doses of crack & amphetimines in a panick-stricken attempt to provide a bit of "stimulation"?

http://www.bloomberg.com/news/2011-...m-china-to-europe-as-global-economy-ebbs.html


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## Atomic (2 June 2011)

So its the y2k / 2011 financial bug . 

And we will all get up the next day with a big hangover and some egg on our face from partying way too hard.

Isn't our economy geared to the yella fellas yen , and don't we have a boom (minning) 
I think theres been some talk of record ore prices for what the last 20yrs and WTF.


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## Uncle Festivus (7 June 2011)

wayneL said:


> I keep hearing references to the failure of capitalism.
> 
> Capitalism hasn't failed at all, it just hasn't been allowed to do its job. Recession is part of the business cycle, and when they started messing with the business cycle, they suspended true capitalism.
> 
> ...




For want of a better word...............to describe the current 'system'?

And even to be fair to Keynes, what's happening isn't strictly part of his philosophy either I guess?


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## tothemax6 (7 June 2011)

Uncle Festivus said:


> For want of a better word...............to describe the current 'system'?
> And even to be fair to Keynes, what's happening isn't strictly part of his philosophy either I guess?



You should read his book, I don't know if he had _any _philosophy. The guy just rambled on, using sentences and compound nouns as big as paragraphs. I am convinced he barely had a clue what he was talking about, but was just enjoying the ride offered by the fact that no one could understand what he was saying either, and assumed this was because he was smarter than them.

The current 'system' is just your run of the mill mixed socialism and capitalism, be it in China, the US, Britain, Japan, Europe, Australia, wherever. Politicians understand that if they exert too much control over an economy (such as the full-bore socialist experiments), the economy completely collapses, people starve etc etc. But they also know that under full-capitalism, although the economy will be the most productive and wealthy, there will be much much fewer politicians and bureaucrats.
So here we are.


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## Aussiejeff (8 June 2011)

tothemax6 said:


> You should read his book, I don't know if he had _any _philosophy. The guy just rambled on, using sentences and compound nouns as big as paragraphs. I am convinced he barely had a clue what he was talking about, but was just enjoying the ride offered by the fact that no one could understand what he was saying either, and assumed this was because he was smarter than them.
> 
> The current 'system' is just your run of the mill mixed socialism and capitalism, be it in China, the US, Britain, Japan, Europe, Australia, wherever. Politicians understand that if they exert too much control over an economy (such as the full-bore socialist experiments), the economy completely collapses, people starve etc etc. But they also know that under full-capitalism, although the economy will be the most productive and wealthy, there will be much much fewer politicians and bureaucrats.
> So here we are.




"Socialism" has been a major part of any human "economic system" since humans first walked this orb. 
Without local communal groups pulling together to find "food & water for all", humans would never have made it this far!

ALL original human connections were essentially a form of "socialism" until the Industrial Revolution when "capitalism" (which is still a form of "broken socialism" in that it tends to favour one group of wealthier "social beings" over another) really took off.

We ARE "social" creatures of habit after all. 
We ALL live in "societies". 
We currently have "communal social networking" on a grand scale - (eg The WWW, Facebook, et all). 
With all our current accumulated "wealth" we swan around the planet "socialising" on a scale never seen since the days of the Grand Tours for those made wealthy during the IR.....  

IMO "socialism" in some form or other (either politically or economically) will always play a significant role in human evolution. 

aj


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## bandicoot76 (8 June 2011)

Uncle Festivus said:


> For want of a better word...............to describe the current 'system'?
> 
> And even to be fair to Keynes, what's happening isn't strictly part of his philosophy either I guess?




the economic system we are drowning in at the moment is definately not true capitalism... its best described as corporate cronyism


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## bandicoot76 (8 June 2011)

Aussiejeff said:


> "Socialism" has been a major part of any human "economic system" since humans first walked this orb.
> Without local communal groups pulling together to find "food & water for all", humans would never have made it this far!
> 
> ALL original human connections were essentially a form of "socialism" until the Industrial Revolution when "capitalism" (which is still a form of "broken socialism" in that it tends to favour one group of wealthier "social beings" over another) really took off.
> ...





socialism has been claimed by so many factions over the years its mere name has become thoroughly stigmatised... from nazi-ism (nationalist socialism) to communism (marxist socialism) it has been the banner behind which tyrants and madmen hid their totalitarian ambitions... which is a shame because as you say... provided it was implemented in a non extreme, minimal interventionist way it wouldnt be a bad system, i think jeffersons vision of government is still the best we can aim for though:

 "A wise and frugal government which shall restrain men from injuring one another, which shall leave them otherwise free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned. This is the sum of good government." 
— Thomas Jefferson


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## Aussiejeff (9 June 2011)

bandicoot76 said:


> socialism has been claimed by so many factions over the years its mere name has become thoroughly stigmatised... from nazi-ism (nationalist socialism) to communism (marxist socialism) it has been the banner behind which tyrants and madmen hid their totalitarian ambitions... which is a shame because as you say... provided it was implemented in a non extreme, minimal interventionist way it wouldnt be a bad system, i think jeffersons vision of government is still the best we can aim for though:
> 
> * "A wise and frugal government which shall restrain men from injuring one another, which shall leave them otherwise free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned. This is the sum of good government."
> ”” Thomas Jefferson*




Hear, hear!

Say, (theoretical) would you think TJ (if alive today) would stand a chance agin BO at the next PrezElect? 

My guess = Shoo-in......


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## bandicoot76 (9 June 2011)

Aussiejeff said:


> Hear, hear!
> 
> Say, (theoretical) would you think TJ (if alive today) would stand a chance agin BO at the next PrezElect?
> 
> My guess = Shoo-in......




i concur with your guess!!!! total shoo in!... lets hope ron paul has a good run @ the presidency as he's the closest candidate to being a TJ that the yanks have had for years... but he wont... david rockefeller & co will sabotage him for threatening their private lil piggy bank... otherwise known as the federal reserve!


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## explod (9 June 2011)

bandicoot76 said:


> i concur with your guess!!!! total shoo in!... lets hope ron paul has a good run @ the presidency as he's the closest candidate to being a TJ that the yanks have had for years... but he wont... david rockefeller & co will sabotage him for threatening their private lil piggy bank... otherwise known as the federal reserve!




And on just that very point the following article sets out pretty well where the Fed is going now.   We are going to see a lot of dollars floating around soon.

http://www.financeandeconomics.org/Articles archive/2011.06.09 Weak money.htm


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## tothemax6 (13 June 2011)

Aussiejeff said:


> "Socialism" has been a major part of any human "economic system" since humans first walked this orb.
> Without local communal groups pulling together to find "food & water for all", humans would never have made it this far!
> 
> ALL original human connections were essentially a form of "socialism" until the Industrial Revolution when "capitalism" (which is still a form of "broken socialism" in that it tends to favour one group of wealthier "social beings" over another) really took off.
> ...



You imply that all social interaction, all communities, all 'socializing' is socialist. That is word weaseling. Sure 'socialism' sounds like 'being social', and 'communism' sounds like 'a community', but this is not what these things are. Socialism has always best been described as 'from each according to their ability, to each according to their needs'. And what does this create? A community of leaches and slaves. The best men suffer expropriation from and are held back by the lazy, the inept, and the criminal.
It has been capitalism, that is 'freedom of action and association', that has dragged men up from primitive, collectivist tribes, or vicious feudalist oppression, to the state they find themselves in now. Prior to the Industrial revolution, life was hard, brutish, and short. It was the formation of a highly capitalist society in countries such as Britain, that finally offered men the _chance _to live comfortable lives, regardless of their class, cast, or birth.
All capitalists are social. They consider the proper relationship between men to be that of free will, rights, and respect. All socialists are evil. They consider the proper relationship between men to be of sacrifice, guilt, and force.


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## bandicoot76 (13 June 2011)

tothemax6 said:


> You imply that all social interaction, all communities, all 'socializing' is socialist. That is word weaseling. Sure 'socialism' sounds like 'being social', and 'communism' sounds like 'a community', but this is not what these things are. Socialism has always best been described as 'from each according to their ability, to each according to their needs'. And what does this create? A community of leaches and slaves. The best men suffer expropriation from and are held back by the lazy, the inept, and the criminal.
> It has been capitalism, that is 'freedom of action and association', that has dragged men up from primitive, collectivist tribes, or vicious feudalist oppression, to the state they find themselves in now. Prior to the Industrial revolution, life was hard, brutish, and short. It was the formation of a highly capitalist society in countries such as Britain, that finally offered men the _chance _to live comfortable lives, regardless of their class, cast, or birth.
> All capitalists are social. They consider the proper relationship between men to be that of free will, rights, and respect. All socialists are evil. They consider the proper relationship between men to be of sacrifice, guilt, and force.




lol... i keep wondering why you ripped the p*ss out of me earlier on in this link when our views on this subject, if not entirely in unison, are so close? i totally agree with this post and couldn't have put it better myself!


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## Julia (13 June 2011)

Tothemax, great post.   Succinct summary of a complex topic.


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## Knobby22 (14 June 2011)

Tothe max - isn't Medicare socialism?
Isn't higher marginal taxes to the wealthy socialism?
Isn't providing a pension to the elderly socialism? (should we be setting up 19th century workhouses for them?)
Isn't forcing businesses and councils to build ramps so people in wheelchairs can enter socialism?
Isn't providing support to farmers who have been hit by natural disasters socialism?

If so, why are these "evil"?

I agree with you bandicoot with regard to the USA that they have at best corporate cronyism at present.
No economists would be happy in the way they decide things.


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## Aussiejeff (14 June 2011)

tothemax6 said:


> You imply that all social interaction, all communities, all 'socializing' is socialist. That is word weaseling. Sure 'socialism' sounds like 'being social', and 'communism' sounds like 'a community', but this is not what these things are. Socialism has always best been described as 'from each according to their ability, to each according to their needs'. And what does this create? A community of leaches and slaves. The best *men* suffer expropriation from and are held back by the lazy, the inept, and the criminal.
> It has been capitalism, that is 'freedom of action and association', that has dragged *men* up from primitive, collectivist tribes, or vicious feudalist oppression, to the state they find themselves in now. Prior to the Industrial revolution, life was hard, brutish, and short. It was the formation of a highly capitalist society in countries such as Britain, that finally offered *men* the _chance _to live comfortable lives, regardless of their class, cast, or birth.
> All capitalists are social. They consider the proper relationship between *men* to be that of free will, rights, and respect. All socialists are evil. They consider the proper relationship between *men* to be of sacrifice, guilt, and force.




Word weasel? LOL. I like it. Ok, I have weaseled a few words from your rant. They're bolded. BTW, I take it this was a simple error on your part to only refer to *men*, as though they are somehow the only ones that matter here?  



> *Prior to the Industrial revolution*, life was hard, brutish, and short. It was the formation of a highly capitalist society in countries such as Britain, that finally offered men the _chance _to live comfortable lives, regardless of their class, cast, or birth.




I'm pretty sure the Industrial Revolution was the cause of miserable, hard, brutish & short lives for the millions who slaved away in mines and factories for the benefit of a few who indeed DID go on to live comfortable lives. I'm also pretty sure most of those who benefited mightily from the capitalist inspired IR were primarily from middle to upper echelons of society. 

Here's one evil man's view of Capitalism... http://webcache.googleusercontent.c...&hl=en&ct=clnk&gl=au&source=www.google.com.au

LOL

IMO there's good and evil (and in-between) in most forms of society. Life ain't so black and white. IMO.


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## konkon (14 June 2011)

Socialism, capitalism etc etc (or variations and/or combinations of them) just won't work in the long run if you no longer can pay-down (all) your debt obligations with revenue within a given amount of time, but need to tap into other forms of debt to pay off debt! Layers and layers of debt has become the norm in all types of economic models and systems around the world. 

The major banks around the world have made this form of investment acceptable practice, not just for your average investor, but for large corporations and governments. But it's primarily those with lower income, the middle classes and governments that are feeling the heat. Your larger corporations and major banks are repositioning themselves for the next wave of investment opportunities. Are they the masters of my universe? I feel that they think they might be.


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## tothemax6 (14 June 2011)

bandicoot76 said:


> lol... i keep wondering why you ripped the p*ss out of me earlier on in this link when our views on this subject, if not entirely in unison, are so close? i totally agree with this post and couldn't have put it better myself!



I'm just a born ripper of the p*ss, I can't help it. Don't take it personally 


Knobby22 said:


> Tothe max - isn't Medicare socialism?
> Isn't higher marginal taxes to the wealthy socialism?
> Isn't providing a pension to the elderly socialism? (should we be setting up 19th century workhouses for them?)
> Isn't forcing businesses and councils to build ramps so people in wheelchairs can enter socialism?
> ...



Yes, all socialist, all evil. Socialist health-care is especially evil, but that's a whole separate topic. The elderly were once young - they should have taken personal responsibility and saved, rather than expecting the privilege of stealing from others in their later years. Farmers are in the business of dealing with nature - which has never been certain. If they can't live with the risk, they should choose another profession. Why should they have the right to make up their commercial shortfalls from _our _pockets? And by what moral framework does one judge those with more to be more ripe for theft? The same moral framework as a burglar, if you think about it.


Aussiejeff said:


> Word weasel? LOL. I like it. Ok, I have weaseled a few words from your rant. They're bolded. BTW, I take it this was a simple error on your part to only refer to *men*, as though they are somehow the only ones that matter here?



In English, 'man' can be used both in the male and gender neutral form (incidently the same is true in German). I.e. 'the man is tall' (referring to a male human) or 'mankind', 'man cannot live by bread alone' etc referring to a human. 


Aussiejeff said:


> I'm pretty sure the Industrial Revolution was the cause of miserable, hard, brutish & short lives for the millions who slaved away in mines and factories for the benefit of a few who indeed DID go on to live comfortable lives. I'm also pretty sure most of those who benefited mightily from the capitalist inspired IR were primarily from middle to upper echelons of society.



Except that those workers had a choice - remain on the farms, or go to the mines and the factories. Given the masses that chose the latter, the indications are that the alternatives were worse. Sure, it is easy to say that state ownership of the means of production would have _both_ created the wealth of the industrial revolution without creating income inequality (which was present before the revolution anyway). But in reality this is a pipe dream, and all historical attempts at this have had to be constantly explained away by the Left as 'they didn't do it right'.


konkon said:


> Socialism, capitalism etc etc (or variations and/or combinations of them) just won't work in the long run if you no longer can pay-down (all) your debt obligations with revenue within a given amount of time, but need to tap into other forms of debt to pay off debt! Layers and layers of debt has become the norm in all types of economic models and systems around the world.



Don't believe the 'money as debt' videos. Under free banking, credit expansion is constrained, and doesn't balloon away exponentially. The 'money as debt' videos miss some basic points, namely that there are two sides (the creditor and the debtor) in every debt, thus debt is a circular flow, not a linear or exponential continuous expansion.


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## konkon (19 June 2011)

Here's an interesting question: Does the United States need to pay-off its debts so the USD doesn't collapse? No, at least not in full. Obviously, at this rate, the US debt will continue to rise. Holding large debt has become the norm for individuals, businesses and governments. They're all holding larger debt than in previous decades and if just about everyone is doing it, then it becomes acceptable practice to a large (or to some) extent. 

Does the US need to cut military spending? Cutting military spending shouldn't be an option. The US needs to continue to 'control' the seas and geopolitical world to a large extent. It would start to lose its real empire if it gave these up. And it won't. Some county would always (at least, want to) fill the void of world domination (even though some believe all nations should participate in global decision making etc), and I'd rather see the US hold this title. Just look at the alternatives! I could go on and on...; I don't think you can have global cooperation like some socialists believe. You would always have some country that would want to dominate and this would create the same set of problems we have today, if not worse. Better the devil you know in this case. 

Other creditor nations to the United States would stand to lose more if the US just shows them the finger. Kind of like Neo living in a world that was controlled by the Matrix, we are living in a world that is controlled by the United States (systems built and controlled by the US that are hidden to most of us), although there is a growing presence of opposition to this control and some of it must be coming from within the United States; the, in my opinion, near collapse of the financial system in 2008 was premeditated to some extent. Another reason why the military and protective services units/agencies (NSA, FBI, CIA, police etc etc etc) should continue to be funded to protect the US from all forms of harm. And this should be separate from congressional oversight, as congress can't follow through with meaningful and worthwhile measures to protect US interests. Factional fighting is out of control and too many special interest groups have too much political influence. Congress just can't be trusted anymore. 

Raising taxes in these times is counter-productive to reinvigorate the United States middle class (with too much future debt obligations as things stand). *Raising salaries (which would see an increase in tax revenue anyway) would make more sense down the track. *The bar has to be raised to keep up with larger debts. This has to be a viable option in due course. A wealthier US citizen (and even illegal alien) would mean more purchasing power, more money to pay-down debt and more reasons to spur the local and non localised US economy.

*The world is seeing a public versus private battle going on.* The US, Greece etc is downsizing the public service (or attempting to), selling off state-owned assets and privatising whatever it can. This appears to be preplanned to some extent. By deliberately bankrupting a town, city etc you are going to go after any state-owned asset they have to meet debt obligations. 

I don't think the US will reduce its debt over the long run. It will try and reduce the public sector or even privatise it (not its protective services agencies), but this won't even cover any interest repayments. *It is possible that a major war will break-out in the future and this will restructure world creditor and debtor markets.* I'm sure this occurred during WW1 and WW2. This may be a likely outcome if the US is pressured too much, given the position they're in. Another reason why a secretive presence in the financial markets is paramount. The so-called free markets are not there to destroy countries like the United States and its middle class. The way 'Wall Street' operates, it is a free-for-all. Wall-Streets' own sense of reality is vastly distant to main street's and there shouldn't be such a gap. In a world full of laws that prevents, for example, my neighbour from steeling my lawn mower, why is Wall Street (and co) allowed to manipulate and transfer middle class wealth to a sophisticated elite in and outside of the US? Nothing has really changed and it's a matter of time before another GFC (perhaps worse) occurs. 

The US controls markets around the world. Who stands to lose the most if the US decides not to pay its foreign creditors? That would be the creditors themselves and to some extent the US itself; pretty much all countries on earth as a US default could send markets tumbling south, and even surpassing the GFC. Sure all markets are interconnected, but the US would stand to lose less overall. 

Trading partnerships are a forced proposition to some extent. Sometimes you've got very little choice but to trade the way the US wants you to. You have to ask yourself why countries just stop using the USD to trade oil. It looks easier than what it actually is. A total break from pertodollars could 'create' a major war. Other nations don't have the control they probably think they do over their own and other markets, anyhow.

Whatever the US stands to lose, other nations stand to lose more. China for the moment would be the only major exception. It will continue to build wealth and a great part of this will continue to come from within its borders. But it will never be in a position to control world markets like the US does. Other nations don't really have a say whether the US controls markets in general. The complex systems the US established and continues to create and dominate (like algorithmic market trading computers) is setting-up the US for the next generation and beyond. The US is also making sure other countries/competitors are peddling backwards, and to a large extent, thank God they are. The systems are in place to make countries like China very wealthy, but insulated from controlling world markets. 

The US needs to ensure more counterproductive (to the US) market manipulation doesn't occur. Only true patriots, like in its protective services in general, can adequately form a resistance to this ongoing 'wall-street' hijacking of the US economy and the future of the United States; protective services agencies (the lot, NSA, FBI, CIA etc etc) should protect US citizens, interests etc from these out-of-control traders as much as they should from some lowlife with a bomb. Congress, for example, is not the savior it thinks it is. They are counterproductive to a consistent, worthwhile, followed-through set of plans to see the US collectively reemerge as a dominant world player with a strong middle class. 

And if anyone can tell me of a better dominant player to fill the void of the world superpower, I'm all ears....I just can't see it happening. Of course, I have this as a bias so you better try pretty hard.


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## konkon (24 July 2011)

Not raising the debt ceiling will be more devastating *over the long run* for other nations outside of the United States. The slight possibility that it won't get done this time round means that other markets around the world will go in free-fall mode, along with the US, but expect the US to get out of it a lot quicker than the rest. 

I'm sure it will get done, but if it doesn't expect the Euro to go under! Therefore the USD will appreciate over the long term.

But we're expecting a bit too much, I think.


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## konkon (4 December 2011)

The $US is reinforced in nearly every asset class, investment model etc around the world. *The $US is like oxygen to us.* In a hypothetical or future possible world of collapsed markets (for whatever reason), the $US will be the last or one of the last 'men' standing. It won't just disappear like many predict. It (in this world, as it stands) can't 'disappear'. It underlies nearly every other investment model, even indirectly. An analogy would be like saying life on earth would 'disappear' after oxygen here does! You won't have oxygen or the $US 'disappearing' before life or other investment models, asset classes, respectively. Of course, I don't wish for any of the above to occur. I'm just putting-out analogies and hypotheticals.  

So all those packing and preparing for the worst in the USA if there is a so-called hyperinflation situation in the USA, just like I saw on television yesterday, *don't bother.* It's those outside of the USA that might need to worry; hopefully only might and I hope it doesn't happen. 

*The $US is and will continue to defy supply and demand principles that economists hold so dearly.* It's already doing this. The $US is seeing continued support even with all the printing. It's one of the benefits of having the world's reserve currency and you should support every way to continue this into the 22nd century. 

*The stockpiling of food etc* (just in case of the so called hyperinflation of the world's reserve currency) *will have an expiry date* and you might be throwing away good money. *But the $US expiry date is not on the agenda.* Other countries, organizations and agencies might want it to be, but this is where you can help others reinforce the $US continued strength. 

Also think *of a possible situation where other currencies are no longer as effective to buy goods and services, debts etc etc around the world, and the $US is used even more. This would mean less supply floating out there, higher demand of the $US and the $US to stabilize and strengthen; bringing it in line with supply/demand fundamentals*, that we all love! And the $US would continue to be the world's reserve currency.


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## konkon (4 December 2011)

please note that the first paragraph should be amended as follows:

*"The $US is reinforced in nearly every asset class, investment model etc around the world. The $US is like oxygen to us. In a hypothetical or future possible world of collapsed markets (for whatever reason), the $US will be the last or one of the last 'men' standing. It won't just disappear like many predict. It (in this world, as it stands) can't 'disappear'. It underlies nearly every other investment model, even indirectly. An analogy would be like saying life on earth would continue after oxygen here 'disappears'! Of course, I don't wish for any of the above to occur. I'm just putting-out analogies and hypotheticals."*


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## konkon (4 December 2011)

A little more needs to be said about this paragraph:
"The $US is reinforced in nearly every asset class, investment model etc around the world. *The $US is like oxygen to us.* In a hypothetical or future possible world of collapsed markets (for whatever reason), the $US will be the last or one of the last 'men' standing. It won't just disappear like many predict. It (in this world, as it stands) can't 'disappear'. It underlies nearly every other investment model, even indirectly. An analogy would be like saying life on earth would continue after oxygen here 'disappears'!" from my previous post ...

It should read "life on earth would *not* continue after oxygen disappears". The analogy "life on earth would continue after oxygen disappears" is in the context of someone believing that the $US is not really needed as a reserve currency. Not my view though. 

You need to keep this in the context of certain fundamental dynamics, as they stand. I know that theoretically, even toilet paper from some country might be used as a form of reserve currency. A country other than the US might, one day into the very distant future, have a reserve currency, and I'm sure there are plenty looking at this option. *My point was to raise the fact that other currencies, asset classes, economies etc that are so interconnected, even at a delicate level, are so interdependent in the $US survival that this is one key reason why the $US isn't going away any time soon. *

Now the analogy given 'life on earth would not continue after oxygen here 'disappears'!' might seem false, *but what I was alluding to was you would have a really unstable world economy if the $US collapsed, even if you substitute the $US with alternative currencies. In fact, I think you would most probably have chaos and mayhem and countries, organizations, companies, people(!) etc etc trying desperately to reposition themselves. Wars etc would probably break-out. It's possible that major ones even would break-out. Company balance sheets and P&Ls would be falsely re-marked, and this would add to the carnage. It would be a completely chaotic, confusing, dangerous time. *

Depending from which perspective you view the analogy from, it's meant to reinforce the view that in the real economic world, as it stands and has stood for so long (with the $US being the reserve currency) a destruction of the $US cannot have any smooth transition at all!* It would make mankind reevaluate all that he/she owns, mostly to the downside.* *How would you realistically mark valuations if such valuations crashed and then were thrown into the unstable, confusing and problematic world that would evolve? Certainly not with toilet paper or another would-be world reserve currency.

Having said all of this, the $US cannot be easily replaced as the world's reserve currency.*


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## sptrawler (4 December 2011)

What you have to remember konkon is, life existed before the U.S dollar was the reserve currency, actually the U.S as the reserve currency is a very recent phenomenom.
The monetary systems will collapse unless a there is an underpinning commodity that is finite to give it a value.
Just having a fiat system where by a country just prints more money is unsustainable.
Compounding will make wages worthless within a short period of time.


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## konkon (4 December 2011)

sptrawler said:


> What you have to remember konkon is, life existed before the U.S dollar was the reserve currency, actually the U.S as the reserve currency is a very recent phenomenom.
> The monetary systems will collapse unless a there is an underpinning commodity that is finite to give it a value.
> Just having a fiat system where by a country just prints more money is unsustainable.
> Compounding will make wages worthless within a short period of time.





The $US as a reserve currency might be relatively new, but it has grown with all the sophisticated and complex trading instruments around the world. The $US is a part of nearly every different type of trade in a more sophisticated manner than any other reserve currency throughout history. This is a key difference and another reason why it can't go out of existence. 

I've read about the commodity (gold) standard theories and they don't apply to what's going on these days. The world is a far more complex place for a gold standard to be used and for it to be effective. There is so much wealth and debt in the world, and so many complex investment instruments that a return to some type of gold standard would NOT work; even if it was tried for a while.


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## sptrawler (4 December 2011)

konkon said:


> The $US as a reserve currency might be relatively new, but it has grown with all the sophisticated and complex trading instruments around the world. The $US is a part of nearly every different type of trade in a more sophisticated manner than any other reserve currency throughout history. This is a key difference and another reason why it can't go out of existence.
> 
> I've read about the commodity (gold) standard theories and they don't apply to what's going on these days. The world is a far more complex place for a gold standard to be used and for it to be effective. There is so much wealth and debt in the world, and so many complex investment instruments that a return to some type of gold standard would NOT work; even if it was tried for a while.




That is all well and good, but at the end of the day money is only numbers on a spread sheet. When it goes all ape sheet there has to be a reset.
This happened with the South American debt in the 70's or 80's, if I remember correctly their interest payments exceeded their g.d.p.
The debt was written off, now Brazil is doing quiet well.
It can be a bit like a company revaluing shares, one minute you have 10,000 shares valued at $2 , next minute 10 for 1 consolidation, you have 1,000 shares vaued at $2.


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## konkon (5 December 2011)

sptrawler said:


> That is all well and good, but at the end of the day money is only numbers on a spread sheet. When it goes all ape sheet there has to be a reset.
> This happened with the South American debt in the 70's or 80's, if I remember correctly their interest payments exceeded their g.d.p.
> The debt was written off, now Brazil is doing quiet well.
> It can be a bit like a company revaluing shares, one minute you have 10,000 shares valued at $2 , next minute 10 for 1 consolidation, you have 1,000 shares vaued at $2.




I think that sets of resets over different periods is what you're going to get. It will largely come down to debtors and creditors fighting it out. But unlike share revaluations, there will be write-downs (40 cents in the dollar type of stuff). In anticipation of this kind of thing, you may get conflicts brewing and they may not be sorted out in the markets alone! 

One of the criticisms I have of those that think that we can go back to a gold standard is their expectations of the price of gold; which would apparently skyrocket to unprecedented levels. In the practical world, it most likely wouldn't, at least for too long. The main reason for this is the synthetic curbs that authorities can place on trading ie gold, like margin hikes. Another reason, is because birds of a feather tend to flock together. In this case, other commodities would go much higher or would want to go much higher by default. But this can't be the case. It would begin to cripple economies even further and demand destruction would take effect. Prices would be volatile under those circumstances, but would drop as much and as fast as some of the moves up.


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## konkon (19 April 2012)

konkon said:


> China is in trouble (in the long run) and here's one reason why: If China keeps buying US treasuries/dollars then the US dollar will drag the (pegged) yuan down. But this is a problem when China's +10% growth means the yuan should be going the other way - up! And at around 5% per year, at least. So there is a spread in the dynamics in China, which pretty much means high inflation down the track. Which means interest rates there should be going up much higher and faster than what is happening right now. Problems down the track.
> 
> Now look at an alternative. If China stops buying US treasuries/dollars, like many are predicting, then there will be a run on the US dollar. It may collapse, which would create volatility in markets around the world, kind of like we saw in October of 2008. Vickers said that China not buying US bonds will trigger a meltdown, far worse than 2008. He was shorting and making money back then and knows what he is talking about. It's a question of whether China stops buying US bonds.
> 
> ...




I'm not happy with this passage of mine. Clarification needed: "If China keeps buying US treasuries/dollars then the US dollar will drag the (pegged) yuan down. But this is a problem when China's +10% growth means the yuan should be going the other way - up! And at around 5% per year, at least."

What I wanted to say here is that China is going to have a stronger yuan down the track, even by default if Vickers is right (and even if his theory doesn't eventuate), and this is not something China would want. A stronger yuan is on the cards in the long term, in many macro possible case scenarios. 

There might be another passage like this one that I needed to clarify in one of my threads. This clarification should suffice.  

China would want to devalue its currency tho in the distant future, but kind of like Japan (and for some different reasons), it may not be able to.


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## konkon (19 April 2012)

konkon said:


> I've been reading up on the possible demise of the US dollar and have viewed many Youtube documentaries (many of which are quite good) on the future of the American currency and its impact on global markets. I have also discussed this with many people here and I'm surprised many don't see its potential downfall as an issue. What am I missing?
> 
> I still believe the USD will firm up in a few years and the Fed may have to, by default, increase interest rates in the US. But it will fall further over the next year, I guess. That might depend on whether the Fed in the US stops the quantitative easing. If it does, then the US dollar might drop even further. Maybe. Quite difficult to predict, but very important to know. Is it going to continue to fall no matter what the Fed does? The Fed may just slow the process down.
> 
> When the Fed does stop its quantitative easing, there will be more volatility on the markets. You can be sure of this. The VIX will rise and fall with greater frequency and momentum. Quantitative easing has soften the VIX at the moment.




"That might depend on whether the Fed in the US stops the quantitative easing. If it does, then the US dollar might drop even further." 

Meant to say if the fed continues QEs the usd will continue to fall.

"The Fed may just slow the process down." No with QEs, the fed is helping devalue the usd.


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## Glen48 (19 April 2012)

The USA  will go on printing until it all tanks, the problem will be if and when other countries  refuse to buy USD bonds.


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## explod (19 April 2012)

Glen48 said:


> The USA  will go on printing until it all tanks, the problem will be if and when other countries  refuse to buy USD bonds.




And obviously they have begun to:



> In the US, the Fed has candidly admitted in print (in the recently released Z-1 flow of funds report) that it bought 61 percent of ALL the debt issued by the US Treasury in 2011




from (The Privateer Newsletter) Early April issue.



> The path of the dollar is unsustainable and therefore the dollar will not be sustained.  In time, the dollar will join a crowd of multiple reserve currencies, be subordinated to SDRs, be rejuvenated by gold or descend into chaos with both redemptive and terminal possibilities




from "Currency Wars" James Rickards, Penguin 2011 at p.255


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## Tyler Durden (19 April 2012)

I read somewhere (can't remember where now) that China may be wanting to get the yuan as the reserve currency.


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## konkon (26 April 2012)

explod said:


> _The path of the dollar is unsustainable and therefore the dollar will not be sustained. In time, the dollar will join a crowd of multiple reserve currencies, be subordinated to SDRs, be rejuvenated by gold or descend into chaos with both redemptive and terminal possibilities_
> 
> from "Currency Wars" James Rickards, Penguin 2011 at p.255




I think the $US is very much sustainable. For one, it is too interconnected to most asset classes and investments, indirectly if not directly. 

Those SDRs are interesting, and if it's the sort of thing the IMF might be behind, then even more of a reason to keep the IMF at bay! I'm not surprised the US decided not to fund the IMF this time round. 

I wouldn't be surprised if many are watching what the IMF does and if it tries to sway from its mandates to ie. 'help' poorer nations. If the IMF tries to push for an alternative reserve 'currency' (I don't think it can for many reasons) or tries to push for another alternative currency, then this will trigger (maybe already has) alarm bells in the US. The IMF is no match for the US, anyway.

Gold can be an alternative 'currency' play to the $US but it's no match.


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## Glen48 (26 April 2012)

Other than this you may be correct:


http://www.yolohub.com/economy/22-red-flags-that-indicate-serious-doom-is-coming


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## konkon (26 April 2012)

Glen48 said:


> Other than this you may be correct:
> 
> 
> http://www.yolohub.com/economy/22-red-flags-that-indicate-serious-doom-is-coming




Yes, this was an interesting article. 

_"The 9 largest U.S. banks have a total of 228.72 trillion dollars of exposure to derivatives.  That is approximately 3 times the size of the entire global economy.  It is a financial bubble so immense in size that it is nearly impossible to fully comprehend how large it is." from the article_

How does something like this happen and is it true? I keep hearing about these derivative exposures but it still doesn't make sense as to how high this number can be.  Are they based on contractual arrangements that will one day need to be met with part payments of real money, as that sort of capital doesn't exist. 

If this is true, then is this why I keep reading about possible future non USA backed (but backed by some organization that's in the press a fair bit!) SDRs needed maybe to honor contractual derivative agreements? 

If this happens, and hopefully the derivative stories are just that, then does this mean an attempt at an alternative reserve currency?

A possible attempt at best I think.

If, and this is a big 'if', these dots can be connected like this, then this should, I'd say, concern those in the USA that want to see the USD as the reserve currency. The USA doesn't have enough $US to commit to these programs (if you can call them this!) for logistical and restrictive reasons. If it was to commit in part with $US, it would most likely devalue the USD very quickly (which no one wants!). 

The call for maybe (you know which organization's) SDRs to soak up the refinancing, debts, part payments etc, by implementing possible future SDR bonds or really synthetic fiat paper (!), would potentially be a paradigm shift in world markets. 

Maybe and just maybe the USA should look at creating synthetic contractual bonds of their own (even putting forward the blueprints in secret) just in case it heads down this path and the stories I keep reading about and listening to on ie finance programs, become a little more real than I would personally hope for.


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## Glen48 (26 April 2012)

BoA the bank that got 11B of the feds and then use it to pay back 10 b  they borrowed under tarp and got a pat on the back for and Morgans hold the largest number and most at risk.
 Think four big banks in USA stand to loose the most.
 Depends if you believe we will have another depression just like we have been doing every 80 yrs or so since records were kept or it is just a down turn.
Will know for sure by Xmas.


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## konkon (26 April 2012)

Glen48 said:


> BoA the bank that got 11B of the feds and then use it to pay back 10 b  they borrowed under tarp and got a pat on the back for and Morgans hold the largest number and most at risk.
> Think four big banks in USA stand to loose the most.
> Depends if you believe we will have another depression just like we have been doing every 80 yrs or so since records were kept or it is just a down turn.
> Will know for sure by Xmas.




If the central banks at large don't cut-off supply, then a depression in the future, kind of like the one in the 30s, is off the table, I think, in the near future. The Fed won't want to cut supply, but the ECB has inherent restrictions that originally came with the formation of the EU, or around about that time. Germany won't want to backstop a higher percentage of debts or run the risk of doing this. One reason why the EU and the euro is potential toast, down the track, especially in its current state. Maybe an EU and euro mark II is on the agenda. 

But how long can central banks around the world, at large, keep printing to help with refinancing, debt restructuring etc on a large scale? Economic models, theories etc will continually be tested, as they already have been. And what will be some of the trade-offs and consequences moving forward. Mounting debts is a major problem, for sure, as are other consequences on macro and micro levels. 

The care-factor of large and unprecedented debts is also unprecedentedly low, and this has to be another concern. 

The financial and monetary systems are not making a lot of sense to a lot of people and investors etc. 

Is it possible or even likely to have a world wide depression, when the supply of money just keeps rolling in? I would imagine it is, but can it still be avoided while central banks go on their printing frenzy? The fed would have us believe that a depression is or will be avoided if the supply of money just keeps coming in. But how long can this go on before one added straw breaks the camel's back? The supply of money to Greece is still on to some extent, and their debts have been reduced, but surely they're in a depression and probably will be for some time.

On the issue of the euro, this is (to me, at least) a foreign currency to the EZ nations; not being able to print your own money to suit your nation's individual interests at different times but instead going to the ECB for loans, like you and I would to a retail bank, is a really big deal. One of many of my criticisms of the EZ and the euro.


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