BEWARE THE 2%


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Mark
Mark

On and on and on, about something he knows nothing about.

As the Euro collapses , The smart money (wealthy trying to store wealth) will pour into the dollar. What alternative is there?

The Ronnie Paul strong dollar and lower prices , especially imports will magically appear. Real wages in terms of purchasing power will increase.

However, those wages and what is produced in the US will not be competitive with import industries and the U.S. will not be able to export much. It will be the Great Depression all over again.

What would Ronnie Paul like to do? Have the Fed raise rates and strengthen the dollar further?

The Fed really isn’t the real problem. It’s the governments ability to borrow from the public over decades and the governments ability to borrow from the Fed.

If the government was restricted through a constitutional amendment from issuing debt as Bill Still and Martin Armstrong advocate. And just print the money for deficit spending. The effects of the tax will be felt immediately by the public and not one lump knock out punch when the government can no longer borrow from the public.

Jim Martin
Jim Martin

Thank you, Ron Paul… you hit the nail squarely on the head again!

Now why can’t other leaders in government see the light? Do they care about middle class folks? Are they being mislead? Are they stupid? Are they being coerced?

I guess that us middle class folks need to rise up and bring about “real change that we can all believe in” by making small changes in how we manage our lives and our finances. Control your spending and live within your means, use cash for purchases, support local businesses in your community, simplify you life, downsize your home, purchase used vehicles and other goods, stop feeding the bankers and tax men, grow your own food, walk more and drive less, look for ways to save on fuel and electricity!

With enough folks getting on board, all of these little things will add in a way that makes a big difference. There is strength in numbers if we all work together.

Relevant quotes for today:
1. “A penny saved is a penny earned” – Ben Franklin
2. “A penny saved is two pennies earned” – IRS
3. “For every action there is an equal and opposite reaction” – Sir Isaac Newton
4. “Don’t Start The Revolution Without Me” – Jesse Ventura, 38th Governor of Minnesota

Mark
Mark

We are at the point of plateau stagnation until the system blows up. As governments around the world repudiate their debt around the world because they can no longer afford interest payments. And governments compete with other governments through competiive devaluation to increase exports, the dollar will be the last refuge.

Will the U.S. once again impose a smoot Healy tariff to protect US industry?

Can the U.S. peg its currency the way the Swiss national bank tried?

How prepared is the American public to hear the term “one world currency” as far as international transactions are concerned?

Perhaps, war is the easiest way to repudiate debt after all. If I destroy your economy by bombing it to the ground , there isn’t much hope I’ll get paid back anyway.

DC Sunsets

1. As pointed up by CHS, the Fed can’t dilute the USD; their attempts to do so are like a fart in a windstorm, and the “new dollars” are absorbed instantly by the heat sink of the global economy.

2. Foreign central banks are destroying their currencies so money flees into dollars, and into US Treasuries and into US Stocks. Buying silver and gold also may, for a time, insulate foreigners so much that their dollar prices may rise (I’m invested that way, much to today’s chagrin.)

3. The US dollar is thus under upward (FOREX) pressure and there’s not much the Fed can do about it. This will keep domestic US inflation low as commodities and foreign goods get cheaper.

4. Eventually this too will end. Most of the debt in the world is denominated in dollars, and foreign borrowers are getting KILLED by the advancing value of the dollar vs their own currency.

5. There’s simply TOO MUCH DEBT. Eventually it has to be reconciled, and the collapse of that value will be an historic economic collapse in wealth. Banks, stocks, metals, and above all, bonds will drop in dollar value, a deflationary depression larger than that of the 1930’s as people scramble to hold onto (and obtain) dollars.

6. We aren’t there yet. Until we are, stocks can rise, bonds can rise, and the dollar can rise in value vs other currencies. The Fat Lady has been warming up for years, but we won’t know she’s on stage until we see the Dow Jones Industrial Average have a couple “down 1000 points” days.

7. Deflation is in fashion, and there’s a century of inflation to balance. Declines occur faster than rallies.

DC Sunsets

For 40 years people grew more trusting of charlatans who promised two hamburgers next week for the chance to have one this week.

By the time we reach nadir on the coming economic wreck, a potential borrower will practically need to post 100% collateral for every dime they want to borrow.

“Oh, Mr. Smith, I see you want to borrow $1,000. I’m sorry sir, but you need to deposit $1,000 into your account (and leave it there) if you want to borrow $1,000 from us.”

And politicians who propose “bond issues” to pay for things will likely be strung-up by the neck. Until, that is, people forget…and we go back to this sort of stupidity in a few centuries.

Mark
Mark

D.C.

The stock market is an alternative to government debt of all kinds. It represents real economic production. The governments asset is its ability to tax.

When there isn’t much economic activity to tax and people fear taxes they will flee. The stock markets demise will be earnings. In a deflationary depression people lose all confidence and hoard money any way they can. The velocity of money turns violently down. Companies simply won’t be able to make money even after all sorts of layoffs.

So, the dollar will be strong. 5 cents an apple sold by a local curb side merchant. There won’t be much money around no matter how much they try to devalue. No economic activity and no earnings. How much is a stock worth that is losing money? Especially, if these brilliant CEOs and Chief Finacial Officers were buying back stock with low interest rate loans. Nah, no risk to the firm there.

yahsure
yahsure

I like Ron. But Gold isn’t the answer. I would prefer silver. It would be easier for the average person to use.
I guess we will see what finally brings the economy to collapse and what change occurs. Its going to be really bad.

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