Everything’s Fixed, Everything’s Great
Submitted by Charles Hugh-Smith of OfTwoMinds blog,
A brief summary of everything that’s been fixed.
Much to the amazement of doom-and-gloomers, everything’s been fixed and as a result, everything’s great. The list is impressive: China: fixed. Japan: fixed. Europe: fixed. U.S. healthcare: fixed. Africa: fixed. Mideast: well, not fixed, but no worse than a month ago, and that qualifies as fixed.
Let’s scroll through a brief summary of everything that’s been fixed.
1. China’s economy. It was slowing down, which would have been bad for the global economy. But the recent PMI (preliminary made-up indicator) readings have been the strongest since the Great Leap Forward.
The basic story here is China needs a million more of everything: a million more concrete highrises, a million more airports, a million more miles of highway, and so on. And because there are 200 million rural peasants anxious to open nail shops in all those empty ghost cities, there is no end to growth in China.
And thanks to central banking and a wide-open spigot of credit, there’s also a million times more leverage and debt in China. It’s a perpetual growth machine.
There are growth stories on top of growth stories in China. There are 300 million diabetics and pre-diabetics in China right now–the equivalent of the U.S. population. Think of all the growth possibilities for diabetes clinics in those ghost cities. All the owners of those nail shops and diabetes clinics will be getting so rich, Goldman Sachs will be needed to sell them safe investments like Detroit Muni Bonds.
2. Japan’a Abenomics has worked, and Japan is back. Need proof? Just look at the Japanese stock market: it’s up. What more do you need? Hello Kitty is expanding its market share of the global Cute market–yee-hah!–and the 2020 Olympics will be a growth story for seven years–a Biblical cornucopia of growth, growth, growth.
3. Europe is on the mend. European stocks are at 5-year highs–proof everything’s fixed. Greece’s budget is near surplus (if you exclude interest payments on their debt), and there’s light at the end of the tunnel on Europe’s debt crisis. The fix is LTRO (long-term ripoff operation)–basically another perpetual growth machine funded by free money issued by the European Central Bank. Can’t pay your debts? No problem, just borrow more!
It won’t take more than a couple trillion euros to set things right and get things moving.
Sure, unemployment in some countries is 25% (or is it 40%? hard to be sure), but that’s stabilized, and there are sure to be more jobs for waiters/waitresses as tourism works its growth magic.
4. The U.S. healthcare system is fixed, thanks to ObamaCare. I can’t understand the details, of course, but then neither can anybody else, and that’s the beauty of it: there’s a practically unlimited demand for people who know how all this works. Job growth will be through the roof.
Here’s a summary of how ObamaCare works. There’s three levels, kind of like a credit card: silver, gold and platinum. Silver is like your current lousy plan, only the government will give you $167 if your plan costs more than $10,000 (or maybe it’s $1,670–nobody knows).
The Gold level is much better, similar to gold-plated healthcare plans enjoyed by government workers, but it costs a lot more. Platinum is equivalent to what everyone in other advanced democracies gets from national healthcare, only it costs twice as much here in the U.S.
But hey, you get what you pay for, and that’s why the U.S. healthcare system is the best in the world–we spend twice as much per person as anyone else.
If you refuse to get insurance, the government penalizes you $167–or maybe it’s $1,670. Nobody really knows yet because there are thousands of pages of fine print to sort out.
5. America has its own perpetual money machine to fuel growth. The Federal Reserve creates money and then buys Treasury bonds. The Federal government sells the bonds and uses the cash (just created by the Fed) to pay for everything: $300 million a piece F-35 fighters, 47 million Food Stamp SNAP vouchers, bridges to nowhere, tax breaks for billionaires, you name it.
And here’s the beauty of it: there’s no limit to this money machine. The Fed can print a gazillion dollars and buy a gazillion dollars of Treasury bonds so the government can spend a gazillion dollars. There is no consequence of this, it can go on forever. That means we can borrow as much money as we want to buy everything we want, forever.
So you see, everything’s fixed, because everybody that can create their own money can do so without limit or consequence. It’s a perpetual money machine, and that fuels a perpetual growth machine. No limits on credit and debt means no limit on spending. Free money for everyone and everything–it’s unbelievably easy.
Doom and gloomers have been wrong, just like Paul Krugman said. The solution to every problem is at hand: create more money and credit, in ever larger sums, until a tsunami of cash washes away all difficulties.
Please note this is a satire.
Trouble is for some n power, satire not!
[img]http://www.youtube.com/watch?v=D3iFYtUZgv8[/img]
Cute song ahead of its time but fitting for this thread.
“Celebration Day”
Her face is cracked from smiling, all the fears that she’s been hiding,
And it seems pretty soon everybody’s gonna know.
And her voice is sore from shouting, cheering winners who are losing,
And she worries if their days are few and soon they’ll have to go.
[Chorus]
My, my, my, I’m so happy, I’m gonna join the band,
We are gonna dance and sing in celebration, We are in the promised land.
She hears them talk of new ways to protect the home she lives in,
Then she wonders what it’s all about when they break down the door.
Her name is Brown or White or Black, you know her very well,
You hear her cries of mercy as the winners toll the bell.
[Chorus]
There is a train that leaves the station heading for your destination,
But the price you pay to nowhere has increased a dollar more.
Yes, it has!
And if you walk you’re gonna get there though it takes a little longer,
And when you see it in the distance you will wring your hands and moan.
http://www.youtube.com/watch?v=D3iFYtUZgv8
couldnt get it to paste…..aaargh!
Here we go again!!
“Happy days are here again”
That was the theme song for the Democratic party in the 1930s
History does repeat!
I love Rick Santelli; the only sane person on CNBC
Santelli Rants Against The Intellectual Arrogance Of The “Intellectuals”
Submitted by Tyler Durden on 09/13/2013 15:46 -0400
The American public is “just too darn stupid to get it.” That is the message that CNBC’s Rick Santelli hears from the mainstream media when discussing polls that suggest US citizens are against a rise in the debt ceiling. Perhaps, as he exclaims, “we should only poll the Harvard and Princeton professors,” since they have such a good grasp of reality.
But, it is the “giant leap of faith” that the Fed can really move unemployment and keep the economy humming along to support the level of equities that has the Chicagoan irate. Congress – listen up – he explodes, “70% of Americans oppose raising the debt ceiling, and 55% oppose it even if it means default.” With the mid-terms not so far away, Santelli warns, “Americans know exactly what they want and they are not getting it from the current Congress.”
http://www.zerohedge.com/news/2013-09-13/santelli-rants-against-intellectual-arrogance-intellectuals
Courtesy of AB aka crazy eyes…. http://www.barnhardt.biz/
To: [PLAN SPONSOR]
[PLAN SPONSOR ADDRESS]
Dear Plan Sponsor,
I am writing to petition that the [LEGAL NAME OF THE PLAN] be amended to allow in-service withdrawals. As the plan stands now, the only way for actively employed participants to retrieve money is through a 401K loan or a Hardship Withdrawal. Neither of these two options allow participants full access to their assets. While I understand the purpose of the [LEGAL NAME OF THE PLAN] is to encourage savings for retirement, I fear that my assets are not entirely safe from fraud and theft and will not be available to me at retirement.
Numerous recent examples indicate the financial markets are rife with fraud, often at the peril of the individual investor. From what I gather of recent events I do not feel that my money is safe and currently have no recourse to move my assets from the [LEGAL NAME OF THE PLAN] to other investment vehicles.
Examples of recent fraud and theft in the financial industry:
MF Global
MF Global was a global commodities brokerage that declared bankruptcy in October of 2011. It was discovered that approximately $1.6 Billion in customer segregated funds were stolen and used to meet capital requirements in the weeks leading up to bankruptcy. To date, no one stands to face criminal charges.
Peregrine Financial Group (PFGBest)
In July of 2012 it was discovered that PFGBest stole approximately $220 million of customer funds. While claiming to have over $200 million in bank accounts, it turned out that PFGBest held only close to $5 million. The fraud appears to have spanned multiple decades despite the firm being regularly audited. The PFGBest government-backed auditors were not independently verifying the bank account balances and were instead using forged documentation provided not by the bank, but by the firm itself.
Sentinel Management Group (SMG)
In August of 2007, Sentinel Management filed for Chapter 11 bankruptcy protection. Investigators found that Sentinel leveraged over $500 million in customer funds as collateral for a loan from Bank of NY Mellon. This loan was used to fund in-house speculative trading. The National Futures Association (NFA) was the auditor of Sentinel, and has admitted to signing off on audits despite not fully understanding the books or the accounting method used. The NFA admits that it didn’t audit SMG properly.
However, what is most frightening is the recent ruling in the Sentinel Management Group case by the 7th Circuit Court of Appeals. The court ruled that the Bank of NY Mellon be placed first in line ahead of customers seeking the return of their money.
“That Sentinel failed to keep client funds properly segregated is not, on its own, sufficient to rule as a matter of law that Sentinel acted with actual intent to hinder, delay, or defraud its customers.”
U.S. Circuit Judge John D. Tinder
This ruling shows that not only does the Bank of NY Mellon move to the front of the line, but that using customer segregated funds as collateral is no longer considered a crime, and that co-mingling customer segregated funds with proprietary funds is no longer considered fraud. This ruling implies that customer assets held at a bank or trust are the legal property of any counterparty to loans the depository institution takes.
LIBOR Rate Manipulation
Last summer, Barclay’s Bank admitted that it tried to manipulate the LIBOR during the financial crisis in 2008. This rate is used as a reference for a range of financial products like car loans, adjustable-rate mortgages, student loans and credit cards. During the Barclay’s Bank inquiry it was discovered that many other banks may have also been manipulating LIBOR rates. This means that hundreds of millions of consumers, investors and businesses have been paying a manipulated interest rate.
Guaranteed Retirement Accounts (Nationalizing 401K Assets)
In 2010 the Employee Benefits Security Administration solicited feedback from plan administrators and other fiduciaries on the idea of whether or not they “could or should enhance, by regulation or otherwise, the retirement security of participants in employer-sponsored retirement plans and in individual retirement arrangements (IRAs) by facilitating access to, and use of, lifetime income or other arrangements designed to provide a lifetime stream of income after retirement.” This idea has also been called “Guaranteed Retirement Accounts” and been proposed by Vice President Biden and others in the current administration, with preliminary Senate hearings having been held on this plan in 2010. The core of the proposal is to force IRA and 401K plans to offer an annuity of sorts so participants are guaranteed a return on their assets in perpetuity. The preferred investment asset would likely be United States Treasury notes. As America stares down almost $16 Trillion of debt, conservatively projected to increase to $20 Trillion in 2016, forcing 401K and IRA assets into Treasury notes would be a tempting solution to shore up our nation’s dire financial situation. In Europe, Poland just confiscated 50% of all private retirement accounts and pensions.
Source:
http://webapps.dol.gov/FederalRegister/HtmlDisplay.aspx?DocId=23512&AgencyId=8&DocumentType=1
As you can see, despite stringent controls that were placed on the financial industry following the collapse of Enron (Sarbanes-Oxley) and the 2008 financial crisis (Dodd-Frank), rampant fraud not only still occurs, but has increased exponentially, and the regulators charged with protecting the investor are either complicit or negligent. When there is a collapse the individual investor cannot find justice through the courts as Dodd-Frank has imparted a statutory “super-priority” to all megabank counterparties that makes recovering collateral from any institution or fund holding derivatives in its portfolio impossible.
I do not feel that my 401K assets are safe at this point and strongly believe that in the event of a collapse of the trustee [NAME OF THE TRUST WHERE ASSETS ARE HELD] I will have no recourse to recoup my investment. At this point I do not have the ability to withdraw any of my assets held by the plan. Therefore I petition you to consider adding an in-service withdrawal option to the [LEGAL NAME OF THE PLAN] that would enable participants like me to withdraw our assets entirely.
Thank you for your time and consideration.
[NAME]
[ADDRESS]
[EMAIL]
[PHONE]