Is the U.S. headed toward financial ruin? Your opinions please....

by tresdecu 47 Replies latest jw friends

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  sammielee24

  I always recall that famous footage of Saddam Husseins right hand man, going on television and telling his people that 'everything is alright' - right up to the point they decimated a lot of those listeners with their shock and awe bombing.

  There is an article floating around apparently written by a guy in Bosnia who lived in one of the cities there during the war and as he pointed out, right up until the time of the collapse, the government was telling the people 'everything is alright'.

  Ditto Argentina...and so on.

  Think about oil. The USA requires massive amounts of oil to fuel their military all over the world and without deals to keep the oil for themselves, without the surety of having bases all over the world to protect the oil - that military might may be a target. There are documentary sites ...check out the Seven Sisters and you will find the history of oil all over the world and how we have got to where we are. A very good documentary and available for free online.

  People need to figure it out for themselves and do what they think they must based on what they learn. Overall - China is emerging as the power and trading in their own currency. This is the one thing that the USA cannot support - a lack of support for the dollar. Some oil rich countries are now trading with China direct and bypassing petro dollars - Australia just set up some trade with them bypassing the dollar. This does not mean a total collapse but it does mean a currency war that may no longer be won as more countries refuse to bank on the dollar - and a great many are bypassing the dollar including Russia, Brazil and Japan. Perhaps the time for global trading and 'non fair' trade has come to an end - immigration in many countries is now being curtailed as high unemployment and lack of revenue are causing more problems than ever - all these things together mean countries may be required to rethink their strategies and how their governments operate. The US is pretty well bankrupt now. The amount owed can never be paid back unless the money sitting in private pensions can be funnelled back on to the balance sheets and then emerge as an annuity that they themselves will allocate upon retirement. It's the only way out and I think eventually it will come to that. So financial ruin depends on how you look at things - sammieswife

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  Data Alert: Renminbi, Australian dollar start direct trading

  18 April 2013

  Australia and China have agreed to trade each other’s currencies directly, bypassing the US dollar and lowering transaction costs for businesses in both countries.

  China is Australia’s largest trading partner, with two-way trade in goods and services totalling A$128 billion last financial year.

  The agreement is a strategic step towards advancing this important trade and investment relationship. It follows last year’s A$30 billion currency swap agreement between the Reserve Bank of Australia and the People’s Bank of China.

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  These duo actions by the two most powerful adversaries of the U.S. economy and empire, have now joined in to make a move to attack the primary economic stronghold that keeps America as the most powerful economic superpower. Once the majority of the world begins to bypass the dollar, and purchase oil in other currencies, then the full weight of our debt and diminished manufacturing structure will come crashing down on the American people.

  This new agreement between Russia and China also has serious ramifications in regards to Iran, and the rest of the Middle East. No longer will U.S. sanctions against Iran have a measurable affect, as the rogue nation can simply choose to sell its oil to China, and receive Yuan in return, and use that currency to trade for the necessary resources it needs to sustain its economy and nuclear programs.

  The world changed last week, and there was nary a word spoken by Wall Street or by politicians who reveled in their own magnificence as this event took place during the party conventions. A major blow was done on Sept. 6 to the American empire, and to the power of the U.S. dollar as the world's reserve currency. And China, along with Russia, are now aiming to become the controllers of energy, and thus, controllers of a new petro-currency.
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  BU2B

  US Treasurys Are ‘Junk,’ Dollar Headed for Collapse: Schiff

  Text Size Published: Tuesday, 1 May 2012 | 11:07 PM ET By: Jean Chua|Writer, CNBC.com

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  The greenback and the U.S. bond market are headed for a collapse as the U.S. Federal Reserve loses the ability to service the nation’s debt with “artificially low” interest rates, Peter Schiff, CEO of Euro Pacific Capital told CNBC on Wednesday.

  The Federal Reserve headquarters in Washington, DC.

  “As far as I am concerned, U.S. Treasurys are junk bonds,” Schiff said on CNBC Asia’s “Squawk Box.” “And the only reason that the U.S. government can pay the interest on the debt, and I say ‘pay’ in quotes because we never pay our bills. We borrow the money so we pretend to pay, but the only reason we can do it is because the Fed has got interest rates so artificially low.”

  The Fed has been keeping rates on benchmark 10-year Treasurys low by purchasing bonds via quantitative easing(QE) , and this will ultimately be the U.S. economy’s “undoing,” Schiff said.

  “Unfortunately, we are going to get more QE than Rocky movies, because the only thing keeping this phony economy going is this QE,” he said. “And the minute you take it away, it’s going to collapse.”

  Schiff’s comments come after two Fed officials warned on Tuesday that the U.S. could be heading for a “fiscal cliff” at the end of the year if mandated tax increases and spending cuts are implemented. On the same day, fund manager Bill Gross, who runs the world’s biggest bond fund, told CNBC that the U.S. will face a downgrade of its triple-A debt rating if it did not fix its fiscal situation.

  “It’s not just $15 trillion in terms of current debt,” Gross said on CNBC’s “Street Signs.” “It’s probably three to four times that in terms of Medicare, Medicaid, of Social Security, in terms of the present value.”

  “So unless the U.S. begins to make some inroads, and that’s called the structural deficit that the (Congressional Budget Office) and the (International Monetary Fund) basically identified as perhaps six to seven to eight percent, greater than any country other than Japan and the U.K. Until we address that structural deficit, then yes, we're headed to double-A territory,” he said.

  Euro Pacific’s Schiff predicts weakness in the U.S. dollar, which will put pressure on commodity prices and fuel inflation . This will in turn force the Fed to raise interest rates, he added.

  “The Fed will not do it; the Fed knows the only thing propping up our phony economy is zero percent interest rates and quantitative easing. And I think when the market figures this out, it’s going to put even more pressure on the dollar,” he said.

  Schiff is a well-known bear who predicted in 2008 that the dollar will collapse amid hyperinflation . That did not happen, and the dollar strengthened against most major currencies by the end of 2009.

  Andrew Economos, managing director and head of sovereign and institutional strategy at JPMorgan Asset Management, said what the Fed is trying to do is “buy time” by keeping credit cheap and encouraging banks to lend.

  “Look, I am not an apologist for the Fed, but at the end of the day (Fed Chairman Ben) Bernanke is doing the only thing that he can do, which is buying time,” Economos said on CNBC’s“The Call.” “And I think that buys us time to rectify those structural problems the bears are harping about. It allows corporates and households to continue to deleverage and derisk their own personal balance sheets.”
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  BU2B

  Look at Greece. Before their collapse Im sure most there thought it was impossible there too.
• 

  soontobe

  Poor blighter. You've lost 30% of the value of your investment in the past 6 months. Silver is now at its October 2010 price.

  And AAPL's down over 30% in the last few months too. If he's holding long term who cares? It isn't a loss unless he sells.
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  myelaine

  http://www.youtube.com/watch?v=MkAn3VIe1yQ
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  FlyingHighNow

  Don't forget how outrageously expensive it is to go to college here. Then there are the predator, private student loans that are enslaving people after they graduate. All the ball parks are owned by banks and corporations and if they are major league baseball, they have made it nearly unaffordable to take a family to a game. Movies? Tickets cost $11.50 and popcorn and drinks for two cost $10.50. Add it up: it costs close to $75 to take a family of four to a movie. What about concert tickets? For a not so special group they can cost $40 or $50 a ticket. We won't talk about people like The Rolling Stones. Guess only the wealthy deserve to see the Stones in person.
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  sinis

  Yes, it is. If bonds even go up a little bit, it is game over - monetary collapse. Anyone who tells you "no", has theire head buried in the sand. At some point the markets are going to implode and spew shit everywhere. Feds are pumping money like never before. The markets are completely disconnected from reality. I say within a year to a year in a half tops...
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  sammielee24

  Sooner or later interest has to be paid. The USA has kept their rates artificially low for so many years it isn't paying the interest on their debt - the second it goes up a fraction, game over. Other countries are positioning themselves out of the dollar in various ways so as to reduce the impact - remember, the US dollar was not always the standard. People are used to cheap - the government doesn't want to stop cheap food and air fares so they will continue to borrow and keep the voters happy - as I said - the US owes 16 trillion or so that can never be paid back if you tax everyone in the country for another hundred years - there is 17 trillion in private pension funds. If I were looking at the balance sheet it seems easy - take all the private pensions, slide them over and pay off the debt in full - promise to pay you your retirement funds at age 70 from some 'unknown' and mysterious account separate from social security - and I now have a lot of money to play with again.

  Do this and the USA can borrow for another 30 years without a hiccup - however, it means stealing all the money people have in their personal accounts to do it.

  It's a tricky move because it would have to be disguised as something good and not really thievery but for your own good - of course, when other countries do it, it is called stealing but I"m sure we can come up with another way to gold plate it. Doesn't change much at the core though if policy isn't tackled to correct flaws that got the country into this mess in the first place. Twenty five years to recuperate is a long time and a generation of lost souls .....sammieswife
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  sinis

  They Corzined Cyprus, what makes you think they won't do it to the rest of the world? In fact the Fed last year acknowledged that that will be standard operating procedure when a too big to fail institution in the US fails...
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  *lost*

  looks like ye are all fooked over there lads. scary.

  Over in Ireland. Whilst the crooked politicians, bankers, developers and lawyers were fattening up the piggy bank, preparing fleecing the country, and it's citizens,

  The economists had been warning about the impending doom that was coming. The economists were shot down, laughed out and derided.

  Then ..... BANG .... Celtic Tiger shot dead. Cost of living, pft, don't go there. petrol, food shop, electric, gas, oil, mortgages, car ins, car tax, refuse, schooling, clothing, property tax, septic tank tax, tax, tax, tax. Squeeze, squeeze, squeeze. Middle Working Class, Teachers, Law Enforcement, Nurses etc ... are now the working poor.

  It is dire, and it is going to get worse.

  (and the saving pot's were also robbed)

  Banks, are not the places to be stashing your cash.