September 29, 2008 … ??
I think I’m still somewhat amazed yet not surprised at how this is all unraveling. What keeps annoying me is that the rules of the game keep changing (shorting, market manipulation, bailouts…). The powers that be are playing a game and sending out diversions, which will ultimately end up in major bank consolidations as we are already seeing. I’m starting to wonder if the present endGame is the North American Union, and war with Iran.
Given the Austrian theory of economics, excesses need to be cleaned out after a major expansion. What happens when the Fed decides to pump an enormous amount of money into the system given present circumstance?
The market was ready for a huge fall, but if this bailout passes and with the money supply skyrocketing might that mean a serious rally?
However, if the Fed creates a ton of liquidity will it goto the stock market, commodities, both, or somewhere else?
Once the banks are freed of their debt they will resume lending, which may prop up the bubble for sometime. Perhaps not a complete re-inflation, but at least partial, which will then set us up for an enormous crash in the future. Probably after the election and the new administration is in place, which would lead the way into Iran.
While I don’t believe that Armageddon will occur this coming Monday, I believe the dollar will collapse someday. The Gov’t and Fed’s plan is to continuously increase the money supply to inflation away the cost of the 50$ trillion debt. What this means for social security and medicare I don’t know. Our lenders will one day not take it anymore and drop the dollar as reserve currency. Economically, China will be the new super power and once they decide to redirect their efforts to be self serving rather than America serving financial Armageddon will have arrived. Once we have a run on the dollar all those foreign US dollars will come home and that’s when hyper-inflation will turn the dollar into the peso.
What will come after that? I believe once everything has collapsed they will have to go back to precious-metal backed currency. Maybe the Amero?
I don’t know much about the Amero… but one thing for sure… Canadians will start a war before they agree to it. The Canadian banking system is currently affected the least by the current troubles. Their banknig system did not follow the risky leveraging schemes followed by USA and the UK. Canadian economy will get dinged by having its biggest trade partner (USA) go down but it still has much Oil, Iron ore, Copper, Uranium, … they have a balanced fiscial budget (as long as oil stays at $100/brl and they have a trade surplus. I am assuming that China will export the difference out of Canada where the USA exports fall off. That means that commodity prices will remain high while the dollar is weak and the economy is struggling to get back on its feet. Just means more pain for a longer term.
The Fed and its bailouts is just keeping the current failed fake-economy proped up. During Japan’s recession it took so long for them to come around because their Gov’t intervened with too many bailouts. All these bailouts are just prolonging the inevitable and making the fall even harder.
In some previous posts I saw discussion or suggestions of going to war with Iran. All the US military spending is very very inflationary (I believe Chris points this out in one of his chapters). We broke away from the gold standard to print more money to pay for the wars we have fought. While the middle east may keep feeding us money to keep us protecting the middle east I believe our war days should come to an end. We are broke. We can’t afford more military spending. We need to focus on taking care of our self rather than be big brother to everyone else. Let NATO take care of it. Germany just this week came out and said that the USA will loose its economic super power status after all of this. It’s true. Once the confidence is lost then it’s only a matter of time for all our lenders to turn their backs. I’ll take a quote from Warren Buffet:
[quote]It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.[/quote]
very disappointed to wend through the chapters to find #20 not there – great work you’re doing and thanks for that, but when will chapter 20 be available??
I doubt they would willing agree to tether themselves to a sinking ship…not without a war anyway. There won’t be a North American union…I doubt seriously our union will survive more than a couple decades at the most.
The power elite in the USA needs integration with Canada for a number of reasons. One is to to consume its natural resources. Another is to replace the dollar which will eventually crash. The US citizens stand to lose the remaining bits of protection from their constitution over the corporotocracy but is already generally in survival or denial mode to the extent to not resist much. Canadians citizens have lots to lose and many of them realise it. The elite is likely to push this integration through with disaster capitalism sleigh of hand: Create or wait for a crisis and then push it through quickly. Postponing and thereby increasing the scale of the financial system collapse is perhaps their strategy to create the diversion they need. Canada has political parties and intellectuals like Naomi Klein who might alert the public to this in time. As the Latin American countries can warn you: Dont underestimate the amount of covert operations and military invention and PR the USA elite will engage in to achive their strategic goals. To be sustainable your communities also need to be shock resistant, an this implies decentralised.
One of the main principals I would suggest for chapter 20 is: United we stand, divided we fall. This goes for communities but also for countries. The future of Canada, South America, and indigenous people all over the world and democracies like in Europe are all intertwined in how quickly their populations can awaken to the inherent destructive emperial logic of the current economic paradigm and collectively resist it long enough to outlive the resource wars expansive but dying empires will fight.