Detroit was first. It won’t be last. It will be followed by Chicago, Philly, Baltimore, LA, and hundreds of other bankrupt zombie cities. And eventually it will engulf the nation.
Goodbye, Motor City
by Bill Bonner.Gold is not the only money. But it’s the only kind the works in our extended economy.
Today, we approach the same story from a different angle.
It is the story of what happens next — when the growing power of zombies meets declining available resources.
Motor City has been flattened. Now it’s being scrapped. The largest municipal bankruptcy in history. Detroit was once one of the richest…and most dynamic…cities in the world. And it was the centre of America’s most profitable industry: automobiles.
German and Japanese automakers had the good fortune to be bombed out in World War II. But Detroit grew bigger…more prosperous…and full of zombies.
Yes, dear reader, Detroit is a zombie story. Since 1971, almost all big stories have a zombie angle. Because the credit-based monetary system that Richard Nixon put us in is a perfect habitat for zombies.
The New York Times has the report:
‘Detroit, the cradle of America’s automobile industry and once the nation’s fourth-most-populous city, filed for bankruptcy on Thursday, the largest American city ever to take such a course.
‘Not everyone agrees how much Detroit owes, but Kevyn D. Orr, the emergency manager, has said the debt is likely to be $18 billion and perhaps as much as $20 billion.
‘For Detroit, the filing came as a painful reminder of a city’s rise and fall.
“It’s sad, but you could see the writing on the wall,” said Terence Tyson, a city worker who learned of the bankruptcy as he left his job at Detroit’s municipal building on Thursday evening. Like many there, he seemed to react with muted resignation and uncertainty about what lies ahead, but not surprise. “This has been coming for ages.”
‘Detroit expanded at a stunning rate in the first half of the 20th century with the arrival of the automobile industry and then shrank away in recent decades at a similarly remarkable pace. A city of 1.8 million in 1950, it is now home to 700,000 people, as well as to tens of thousands of abandoned buildings, vacant lots and unlit streets.
Yes, the handwriting has been on the wall for a long time. But what does it say?
We’ll answer that without hesitation. It says ‘Beware of Zombies’.
And here we offer a simple test so Dear Readers can tell which side they’re on.
Ask yourself: In the absence of government would people still willingly give you money to do what you do? If the answer is no, you are probably a zombie.
Here’s how it works…
When people realise they can use the police power of the government to get other people’s money, they rarely hesitate. In the case of the Motor City, unionised workers found that they could use government to back their demands. Gradually, wages and benefits rose…
After World War II, Germany and Japan built new auto industries, with factory workers who were willing and able to turn out better cars at lower prices.
Light manufacturing was fleeing the country — to China, Southeast Asia and Mexico.
The heavy industry — car making, steel, mining — was a sitting duck. It couldn’t protect itself from zombies. The zombies soon got control over the government…and then preyed upon fixed industries.
Only four years ago, the US federal government bailed out GM. Or rather, it bailed out its zombified labour unions — guaranteeing wages and benefits the company couldn’t afford to give.
What was happening in the motor business was happening even faster in the Motor City.
As Detroit zombified, productive businesses and taxpayers moved out. Zombies were all that was left. People on welfare. People working for the government. People who were disabled. Crooks, malingerers, shysters — they were all there, getting money for nothing in the age-old zombie fashion.
Was there no way to turn Detroit around?
Of course there was. It was obvious how to do it. But who wanted to do it?
The more dysfunctional the city became the more money the city’s sleaze-ball leaders got from the federal government. That’s how zombieism works: The worse things get the better they are for the zombies…
Zombieism is like drug addiction. You rarely just ‘give it up’. Instead, you have to go all the way…and hit bottom.
Detroit may be hitting bottom now.
And how long will it be before Baltimore and Chicago go broke too?
It depends on how fast interest rates rise. The higher they go the harder it is for these cities to keep up with their promises to the zombies. And since interest rates are probably embarking on a long-term secular rise…it is just a matter of time before they all go broke.
That is when the jig is up. Zombies fall. The credit-based money system collapses…
Gold rises.
Regards, Bill Bonner
Original article posted on Daily Resource Hunter
Since founding Agora Inc. in 1979, Bill Bonner has found success and garnered camaraderie in numerous communities and industries. A man of many talents, his entrepreneurial savvy, unique writings, philanthropic undertakings, and preservationist activities have all been recognized and awarded by some of America’s most respected authorities. Along with Addison Wiggin, his friend and colleague, Bill has written two New York Times best-selling books, Financial Reckoning Day and Empire of Debt. Both works have been critically acclaimed internationally. With political journalist Lila Rajiva, he wrote his third New York Times best-selling book, Mobs, Messiahs and Markets, which offers concrete advice on how to avoid the public spectacle of modern finance. Since 1999, Bill has been a daily contributor and the driving force behind The Daily Reckoning. Dice Have No Memory: Big Bets & Bad Economics from Paris to the Pampas, the newest book from Bill Bonner, is the definitive compendium of Bill’s daily reckonings from more than a decade: 1999-2010.
And you thought $16.7trillion was bad… Leading economist says U.S. national debt is actually $86.8TRILLION
By David Martosko In Washington
PUBLISHED:15:27 EST, 29 July 2013| UPDATED:15:56 EST, 29 July 2013
The U.S. government’s books are in the red by more than $86.8trillion, according to an influential University of California San Diego economist.
That’s a number more than five times as large as the figure acknowledged by the U.S. Treasury and used by government agencies to justify their budgets and spending.
Officially, the debt stands at $16.7trillion, including nearly $12million in debt held by the public in the form of Treasury Bonds, wrote James Hamilton in a working paper for the National Bureau of Economic Research.
On the last day of 2012, the national debt clock in New Yrk City showed $16.38 trillion in debt, comign out to more than $138,000 for each U.S. family. Another $300 billion has been added since then, not including the extra $70 TRILLION Hamilton identified
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Hamilton’s math shows that at the end of 2012, nearly $70.1 trillion (bottom, right) was owed in off-balance-sheet liabilities, in addition to the ‘official’ federal debts
But that number doesn’t include several ‘off-balance sheet’ obligations including $54.1trillion in missing funding for Medicare and Social Security, along with support for federal housing, loan guarantees, savings deposit insurance and the cost of actions taken by the Federal Reserve.
‘The biggest items in this category come from Social Security and Medicare which, if current policy is maintained, will require enormous sacrifices from future taxpayers,’ Hamilton wrote.
Future commitments for Social Security – whose misnamed ‘trust fund’ is actually empty – will cost the government $26.5trillion in today’s dollars when beneficiaries start cashing in their benefits. Future Medicare commitments account for another $27.6trillion.
‘These numbers are so huge it is hard even to discuss them in a coherent way,’ argues Hamilton.
‘[A]lthough one can quarrel with the specific numbers, there is an undeniable important reality that they reflect — the U.S. population is aging, and an aging population means fewer people paying in and more people expecting benefits. This reality is unambiguously going to be a key constraint on the sustainability of fiscal policy for the United States.’
Conservative groups are leaping up to point out the apocalyptic nature of the new numbers.
‘If we don’t do something to get a handle on these unfunded liabilities, the result will be complete economic decay and catastrophe,’ Club for Growth Spokesman Barney Keller told MailOnline.
Keller said it’s ‘important for America to reform entitlements by doing things like converting Medicare into a voucher system or reforming Social Security by offering private accounts for younger workers.’
The Obama administration and its Democratic allies in Congress have historically opposed Social Security and Medicare reform efforts, treating entitlements as a ‘third rail’ that could politically incapacitate anyone who tries to touch them.
‘We will not negotiate over Congress’s responsibility to pay the bills that Congress ran up,’ White House press secretary Jay Carney told Bloomberg last week.
Boehner had said House Republicans are ‘not going to raise the debt ceiling without real cuts in spending.’
The annual congressional squabbles over raising the debt ceiling limit only apply to the $16.7trillion number, not to off-balance-sheet amounts.
That figure, dwarfed by Hamilton’s estimate, also includes sol-called ‘IOUs’ from the Medicare and Social Security trust funds, whose money Congress generally spends every year instead of setting it aside to pay for future benefits.
Hamilton blogs about economics, and wrote about his paper earlier this month, noting that government-held mortgages and housing loan guarantees add trillions more to the financial burden that will be carried by future taxpayers.
‘As of the end of 2012,’ he noted, ‘the outstanding debt and guarantees issued by Fannie and Freddie (along with those of the Federal Financing Bank, Federal Home Loan Banks, Farm Credit System, Federal Agricultural Mortgage Corporation, FICO, and REFCORP) came to $7.5trillion.
That number alone is nearly two-thirds as much as the $12trillion in federal debt held by the public.
In the working paper, Hamilton explains that these commitments gave the federal government a ‘huge’ level of ‘involvement in the housing boom and bust of the last decade.’
Dan Holler, communications director at Heritage Action, told MailOnline that Hamilton’s report ‘destroys the notion that Washington can continue to ignore America’s pressing fiscal situation.’
‘Congress is notoriously slow to act,’ he vented, ‘but at the very least it makes clear that raising taxes and praying for economic growth is not a solution. It should also increase the sense of urgency to reform America’s mortgage finance system, which is currently dominated by taxpayer-backed Fannie Mae and Freddie Mac.’
Wait, what? I thought deficits didn’t matter? Just like air doesn’t matter and wind doesn’t matter and oil doesn’t matter and water doesn’t matter and feet don’t matter and toes don’t matter and…
I’m debt free. I have a mortgage….but I don’t count that, see?
The rapid growth of Detroit (and other manufacturing cities) has been compared to the rapid growth of a cancer.
Industrialists begged for more and more labor for the constant product and plant expansions that was deemed necessary/required/reasonable for the ever growing number of consumers – but really – who pronounced that this rapid growth was in fact an ideal was to run a country?
Perhaps rather it was an ideal way to skim ever increasing profits while brainwashing the newly arrived citizens into the consumerism commensurate with the “American Way”.
“Growth” is not good when dealing with a cancer and Detroit’s extraordinary growth was no different – and yet people were taught it was appropriate and wholesome and would lead to prosperity and riches for all.
The ongoing battle between capital and labor was being played out in a cancerous tumor of unrelenting, mandated growth.
How can you misplace or hide 54 trillion dollars?How could they not know about the missing funds?damn shame.
Zombies aren’t too concerned about their art work either. When these masterpieces get sold this isn’t just Detroit losing; it’s the gutting of America.
“Mark Young, president of the Detroit Lieutenants and Sergeants Association, which represents about 500 mid-level managers in Detroit’s police department, said art should not outweigh workers, whose pensions and benefits are likely to face big cuts as Detroit restructures.
“The Van Gogh must go,” said Young. “We don’t need Monet – we need money.”
The Detroit Institute of Art is not the only major cultural institution that could be caught up in Detroit’s bankruptcy proceedings. “
The government is paying 100 million zombies to reproduce and populate this country. Those that reproduce more or faster get more money. They don’t have to work or produce. Unions aren’t much better. Unions will bankrupt this country just as they bankrupted Detroit. Book it Danno.
@the one known as AWD – Those are not zombies, they are underpriveleged undiscovered talents, and you will treat them with respect.
In this case, treating them with respect means no more pissing and moaning, you must smile every time our glorious leader removes 40% of your paycheck to pay for cost of living increases to these poor souls.
Remember everyone….
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I passed the test. Woohoo! For a minute I thought I was gonna have to turn to selling myself for the pleasure of women.
“The Van Gogh must go,” said Young. “We don’t need Monet – we need money.”
This attitude is the summation of the end of western civilization.
Our heroes – greats like Newton, Monet, Niels Bohr, Beethoven, lesser greats such as the Mercury astronauts – have been replaced with Lady Gaga, Lil Wayne, the Clintons, Sarah Palin, Dick van Dyke.
Does anyone think that, other than the advances in medicine, sanitation and the like, the 19th century agrarian model was a good model for cultivating the mind, body, and spirit?
Wtf is this shit qbout Detroit was once a rich and dynamic city. Ahh the rose colored glasses of history and how much better it was in the old days. Perhaps Detroit was rich and dynamic in the 50′ and early 60’s but by 1970 the rot was deep. By 74 Detroit was the murder capita of the world and the streets and roads were going to crap. When i went to take the asvab in 83 we stayed at a motel where the recruiters told us to not go outside and to not even open the door to the room unless it was a recruiter or somone we knew. I went through Detroit a lot on the way to view live action art in Canada in the late 80’S and we knew not to get off the expressway.
Detroit should have died about 12 billion dollars ago……..
Pregnant Woman Killed By 3 Black Thugs
Three teenage black thugs have been arrested for brutally murdering a 21 year old white pregnant woman in Detroit. She was the manager of restaurant and was in the parking lot when two of the thugs allegedly shot her. She was picked at random. The killers simply wanted to murder a white person. The alleged gunman is only fifteen years old!
Just imagine if the races had been reversed. Just think for a second if a group of white guys murdered a pregnant black woman. This would be the largest news story in the United States for a week. Instead it is only a tiny blip in the local news and will be soon forgotten.
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http://www.newsnet14.com/?p=17562
If you click the link, it’s a European news source. Did you hear anything about this on the MSM? What did Jesse, Al, and Obama have to say about this?
And, that pretty well sums up what’s wrong with Detroit. Being anywhere near Detroit (especially if you’re white) can cost you your life. Or being anywhere near Chicago can cost you your life. The murder rate in Chicago is higher than than the casualty rate for the war in Afghanistan. Until these savages are dealt with, we will have urban jungles unsafe for humans to live in.
Nice looking girl, pregnant, viciously murdered by three black punks leaving her job. I wonder if her murderers had jobs….
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Another example of the high life in Detroit: (must see)
Urban Youths Take Detroit Gas Station “Hostage” ~ “Dis Bad Crew”
Detroit 300 Full Press Conference on Baby Killers & Thugs
http://www.youtube.com/watch?v=UbFr2bjOi70
watch only if you want to see just how bad it is in Detroit.
Detroit is Black Run America. That is the problem, the only problem.
“A pregnant white girl been murdered? She probably deserved it” What about my ride?
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Jesse Jackson’s Escalade Stripped Down By Detroit Thugs While in Town Promoting GREEN JOBS
April 8, 2013
The Rev. Jesse Jackson found out just how rough things are in Detroit.
Several Detroit media outlets reported thieves stole Jackson’s ride — a 2009 Cadillac Escalade — from a parking lot near the city’s Doubletree Hotel.
The SUV was later recovered, but it was found without its rims and one of its windows had been broken, according to Detroit’s WXYZ-TV.
Jackson was in Detroit for a march and rally called “Rebuild America: Jobs, Justice and Peace.”
Just days after Jackson’s SUV was stolen, one of Detroit Mayor Dave Bing’s vehicles also went missing. The GMC Yukon Denali was later found resting on bricks, also missing its rims.
This was good for a laugh this morning as some fellow thugs got to work on Jesse’s Escalade SUV after ripping it off and leaving it ‘rimless’ while the elitist leftist race baiter was up there trying to sell the ‘Obama green job scam’.
You know the one, the money pit formerly being run by fellow race scammer Van Jones you’ll remember, at least until Glenn Beck ran him out of DC for a while.
Not to mention he and the rest of the ‘liberal elitist class’ telling us we need to ‘cut energy’ while he and they drive around regularly in a $75 plus thousand dollar rides. And you can bet it is or WAS at least loaded to the hilt with all that “civil rights hate whitey money’ he cons and extorts out of white owned businesses basically shaking down anyone he can anytime the opportunity arises.
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White Man Dies After Beating by “Bored” Black Thugs—No “Hate Crime” of Course
July 19, 2013
An innocent white man who was viciously beaten for no reason at all by six black thugs died from his wounds this week—but there has been no media outcry, presidential and attorney general intervention, marches about “racism,” or retaliation attacks upon blacks—in sharp contrast to the events surrounding the Trayvon Martin case. Just another murder in Detroit.
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Any city with a sizable white liberal and black population will end up like Detroit.
Here’s how it starts. 1st comes the court ordered gerrymandering to insure permanent minority representation. Next comes the domination of city council by the White Left, this ensures lots of free shit for the moochers and special privileges for the minorities in city jobs. Then comes pressure on the police and DA not to prosecute the Blacks and Mexicans too harshly, sentencing woblers will always be towards the minimal. Jails become revolving doors. Predators become a continual presence on city streets and neighborhoods. Complaints from the working and business community go unheard by the Leftists/Minority rulers. City schools become thug zones and parents with money put their kids into private or parochial schools. As a result people and businesses start leaving and the tax base shrinks.
The terminal stage is can be seen when your city council looks like Zimbabwe’s or Denver’s and just as dangerous and incompetent. This usually equates to having all the top city positions and associated ones filled with the worse people imaginable.
Along with that come the flash mobs, targeting of Whites for killings and rapes, etc.
Now most cities are big enough to keep this going for a long time, decades even. Eventually though the loss of revenue and perks for city workers will force a reckoning.
As for Obama, he’s going to let Detroit swing in the wind. Look even ChairSatan doesn’t have the kind of money to bail Detroit and the other hundred cities in financial duress. It ain’t there. He’s gonna punt and tap dance around this and hope the hell no other city starts filing for bankruptcy in his last 3 years.
Detroitefecation sounds like somewhere ago it was ‘Troitified’.
How about ‘Obamafucation’?
There is no way on this God’s earth that the federal debt can be paid off, yet the fuckers want to borrow and spend more. And there is something wrong when 50 million people are pissed off that corporations are sending jobs overseas but want to grant amnesty and leave borders open so corporations can import cheap workers from overseas. Fucking retards.
Admin
Check out this book I recently read.
Escape from Detroit: The Collapse of America’s Black Metropolis. By Paul Kersey.
Hard to believe that in the 1920’s, Detroit had the tallest buildings in America and a thriving arts and culture industry. Of course, the city was more than 90 percent white. The cosmopolitan attitude cultivated in Detroit, with architects building towers that jettisoned into the sky at heights previously unseen in the entire world, earned the city the title of ” The Paris of the West.” Now, those largely empty buildings stand as a monument to ‘ what could have been ‘ in a city that wasn’t ravaged by unions, liberalism, or a natural disaster.
It was neglected by its majority population that took over the city in the wake of the 1967 riots.
” The Mogadishu of the West ” offers a warning to other American cities. In Black and white, this is the story of Detroit’s collapse.
Paul Kersey takes you on a journey into the real reason Detroit collapsed.
In 1950, Detroit was known to the World as the ” Paris of the West.” Boasting a thriving economy and a population of more than 2 million people ( 80 percent being white ), the sky seemed the only limit for this city on the move.
In 1967, the ” Arsenal of Democracy ” would be home to the worst riot in American history as the Black population of Detroit – roughly 30 percent of the population at the time – would explode in an orgy of violence that was only stopped when the Army marched into town to restore order.
The white population of the city would flee for the suburbs, leaving the remaining Black population in political control of the city’s destiny.
In 2013, order still hasn’t been restored.
Now, a city of roughly 700,000 inhabitants ( 89 percent Black ) has collapsed in a sea of financial mismanagement, crime, drugs, broken schools, eroding infrastructure, and hopelessness.
Detroit is the story of America’s future. From SBPDL Books, paperback 378 pages.
What have I been saying for the past 5 years or so….STICK a “FOR SALE” sign in the USA! Anything and everything will be up for sale to pay off our creditors including you and I! The last great MARGIN CALL was led by the Nazis and Hitler….Time will tell who our great Fuhrer will be…either preaching Nationalistic pride or Globalistic Pride….but all part of the plan to change the geopolitical makeup of the planet and collect on the debt and eliminate a bunch of us USELESS EATERS as Big Z Brzezinski refers to us Americans as!
I suppose “art” is an “asset”…so why won’t Detroit sell it off to help cover some of the pension cuts and RED they are in to appease the bankruptcy courts!? The Detroit Institute of Art might begin selling their pieces at auction! Why not, I’m sure most of the people left in Detroit (who are stuck there) don’t frequent the DIA very often; unless it is because of a court order or something!
Here is an excerpt from the article linked below, it seems that Cleveland museum director David Franklin sees the writing on the wall for this all too familiar trend.
http://www.cleveland.com/arts/index.ssf/2013/07/detroit_bankruptcy_raises_fear.html
Detroit bankruptcy renews fears that the city may sell masterpieces from the Detroit Institute of Arts
“Cleveland museum Director David Franklin said last week he was worried about a rising tendency among museum boards of trustees and foreign governments to view artworks as assets to be monetized in times of economic stress.
He drew a comparison between the debate over the future of the Detroit museum and the decision by the government of Sicily to cancel a traveling exhibition of antiquities scheduled to open in Cleveland in September because the absence of the artworks was reportedly damaging the island’s tourism economy. “