The End of the (Financial) World As We've Known It?


lds2
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FYI the Fed's debt numbers are just the tip of the iceberg as the total credit market debt is 357% larger than GDP at present. That means that a family of four's portion would be around $691,000. US and global debt is currently increasing exponentially and we are at the tail end of that exponential curve to unsustainability. Of course there are different numbers and you can choose the ones that you want to believe, but the important thing is that exponential growth in debt is unsustainable.

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While a lot of the recent articles are a rehashing of what has already been posted, this did strike me as something important...

Matus told Bloomberg TV that the decline of the U.S. capital stock is a bad sign: I would say that one of the things that people have generally ignored is that the U.S. capital stock is in decline. This is the first time post-war we've ever seen it. We don't know what the repercussions are because we have nothing in history to look back on and say, "Hey, last time it did this, this is what followed on it." I would submit to you, though, that it's probably nothing good.

The capital stock Matus is referring to is American companies' investments in new equipment and software – one of the four main components in GDP – less the depreciation of existing equipment.

Everyone Is Ignoring A Sign Of US Economic Decline We Haven't Seen In 60 Years - Business Insider

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The number of Americans on food stamps hit a record high in June, and economists don't expect much improvement as long as unemployment remains high.

Record 46 Million Americans Are on Food Stamps - CNBC

Sep 4, 2012 "The global manufacturing downturn gathered pace in August, with output and new orders falling at their fastest in over three years, a business survey showed on Tuesday."

Global manufacturing downturn gathers pace in August - PMI | Reuters

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  • 2 weeks later...

Food storage is a commandment from Heavenly Father to have right now, there is no better investment than that! :) Bishop McMullin basically promised miracles for those who have "layed up in store" and who can say whether this is not one of the commandments you must obey upon which additional blessings are predicated!... For instance you could share and starve with those around you yet be blessed to survive, at least that is what happened for my pioneer ancestors who shared...

Seriously, food will be an excellent investment this year I think. Prices are already at record breaking levels and we are still IN HARVEST, the highest prices WILL come this spring (barring a depression)...if harvests are good next year in Brazil they may moderate late spring.

However, if the harvests aren't good either in Brazil or next summer I don't know what the world will do as global food inventory will be at a three week level by next fall (even with an average harvest from Brazil) and then we will have another six fall/winter months to get through before more crops from South America could be expected...

Any major failed harvests in the Southern or Northern hemispheres are going to really hurt at least as far as prices for the next few years...and perhaps far more than that...at least for the billions of people that scrape buy on a few dollars a day. And that is due to low supply, who knows what additional inflation will do which is now pretty much guaranteed at least for the foreseeable future.

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The latest forecast by LEAP/2020 predicts the global economy will be ‘sucked into a black hole’ by October..."The best proof is the Fed’s September 13th decision to maintain its Operation Twist programme of Treasury repurchases by adding to it an unlimited programme (in time and amount) of mortgage backed securities repurchases (40 Billion USD/per month)...The Fed is aware that this decision will cause a backlash and damaging consequences internationally. In fact it has been hesitating for months ahead of a new QE3 (6). But, in trying to avoid a socio-economic implosion and a stock exchange collapse on Wall Street...it chose “Psychological Easing” rather than “Quantitative Easing”...

Indeed all the signals are already on red: employment isn’t moving up, the jobs created are paid very much less than those lost (9), poverty is exploding throughout the country (10), … and the US multinationals (11) have increased announcements of falling profits for the second half of 2012 and 2013, returning to the levels of 2008/009, typical of a recession period (12).

GEAB N°67 is available! Global systemic crisis/October 2012 -The global economy sucked into a black hole and world geopolitics heated to white-hot: The seven key factors of an unprecedented double shock

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Can't tell you what this means except that IT ISN'T GOOD!

The equivalent of two and a half years worth of annual US silver mine production has been dumped on the silver paper futures market in the last 24 trading hours.

I wonder how much that "paper" will be worth in the future, even physically holding it has it's problems...

There were also reports of multiple counterfeit tungsten filled small gold bars being discovered in NY today.

A silver article...Silver Smashed to $33.50 As 50% of US Annual Silver Production Dumped on Market in 5 Minutes | SilverDoctors.com

A gold article...Gold Counterfeiting Goes Viral: 10 Tungsten-Filled Gold Bars Are Discovered In Manhattan | ZeroHedge

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FWIW - This could totally be one of those I heard it from my brother's hairdresser thing...and I'm not sure that pioneer rumor mills were any more reliable than our own today...but I thought is was interesting...

My brother, Noah Packard, says that he heard the Prophet Joseph say that the next great (U.S. civil) warafter the war of the rebellion (the Civil War of the 1860's between the North and the South) would commence in a little town now called Chicago but at that time it would have grown to be a very large city. And another brother told me that the Prophet said that the cause of the next great trouble of the United States would be the depreciation of the currency of the United States. I believe I have given you all the facts in as short and concise manner as possible. >>

(Source: A. Milton Musser papers, LDS Church Archives, letter from Nephi Packard to A. Milton Musser, July 24, 1896)

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There are precious metals banks that hold gold and silver and then make certificates that are the equivalent of the metals that they have in the bank. So instead of taking gold and silver home they give you essentially an IOU where you could go and get it or just keep the paper at home and let them store it for you. Of course it can be safer to store the actual gold and silver as paper can be conterfeited, etc. But some people worry about have those assets at home too as it can be lost or stolen. Even in the big banks some gold bars are stolen and replaced by sophisticatedly made goid covered tungsten bars.

So if you took all the silver made in two and 1/2 YEARS and put it for sale all in one day, that is what happened the other day. Half a years worth went out in 5 minutes.

This is happening a lot, the gold bankers threw everything they had at the gold market the other day to keep it under $1800. The reason I read is because a lot of computer automated programs were set at $1810 to sell and it would have put the gold market into chaos.

My Blog (Not lds2s blog :) ) Article on how bullion banks had to halt golds advance the other day...

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In this article basically Robert Fitzwilson (economist during past inflationary years) says that we have had a 200 year technology induced nirvana which is slowly coming to an end. We have seen deflationary pressures as tools made things like clothing and food dirt cheap. But that is coming to an end. As countries and peoples compete for available finite resources (such as food and cotton) prices inevitably go up.

Between productivity declining and money printing we should look into converting our money into real assets.

"If one has savings, the simple way to sidestep the financial implications of what lies ahead is to convert them as soon as possible to real assets. Anything left in the current monetary system that is not absolutely necessary will be severely diminished or destroyed.

The U.S. elections are a few weeks away. Sadly, no matter who wins, the trillion dollar deficits, ballooning entitlements and printing will continue apace. Stay focused on wealth preservation. If we are to eventually turn back from the fiscal cliff, it will be a long and hard struggle. Even if victory is achieved, the existing stock of paper-based wealth will be severely impacted unless protected. Time is running short to take action.”

My Blog

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"If you are going to talk about the economy, the first thing to recognize is that this is an enormous hit to our wealth,” said Reinhart, a former Federal Reserve economist. “The storm destroyed significant capital and infrastructure in areas, and that’ll leave an imprint..."

"Estimates of the economic blow dealt by Sandy range anywhere from $20 billion to as high as $50 billion..."

Sandy an 'Enormous Hit' to Economy: Ex-Fed Official - US Business News - CNBC

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Derivatives:

You have $1.1 quadrillion of derivatives, and all of the gold ever produced, which is in one corner of the chart, is $9 trillion. If you take the gold said to be held by central banks, which assumes the central banks physically possess the 30,000 tons and I don’t believe they have anywhere near that, but hypothetically speaking, if they did, it is only $1.6 trillion worth of gold...

So what I am saying with this chart is if there is a derivatives blow up, you can only imagine the amount of money that would need to be printed. And, again, I think there is a very high probability of a derivatives blow up taking place.

My Blog Kingworldnews blog

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I'm going to go to Europe this fall. I think it will still be there.

I'll be in the UK, the Netherlands and Germany.

All this alarmist stuff is nonsense.

I'm Back!!!

From Europe that is!!!! I said I was going, and this is my report to you.

Yes, it's still there, the ATM machines work and they are still serving food and drink, I was able to find hotels, roads, food ........in a word EVERYTHING.

See? Things are not so bad!!!

Well one bad thing; my friend's car was broken into in Holland, but we were able to go the Germany to have it repaired!!! Yes, repair facilities too!!!

And a lot of friendly helpful people.:D

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So why are these billionaires dumping their shares of U.S. companies? After all, the stock market is still in the midst of its historic rally. Real estate prices have finally leveled off, and for the first time in five years are actually rising in many locations. And the unemployment rate seems to have stabilized. It’s very likely that these professional investors are aware of specific research that points toward a massive market correction...

--Newsmaxwires

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I hope that is the reason my friend, other articles are talking about bubbles, lots and lots of bubbles. We'll see.

"Somewhere along the way, I would have hoped they might have noted that each new crisis is larger than the one before – necessitating an even larger response that begets an even larger crisis next time, etc., and so on. A corporate bond hiccup in 1994 led to monetary loosening that enabled the development of the Long Term Capital Management (LTCM) fiasco of 1998, which was followed by the tech bubble, and then the housing bubble, and here we are with a now global equity and bond bubble that is larger than all the prior bubbles combined. Much larger. It was famously said that the market can remain irrational longer than you can remain solvent."

Four Signs That We're Back in Dangerous Bubble Territory | Peak Prosperity

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The closely-watched ISM index of US factories tumbled through the “boom-bust line” of 50 to 49, far below expectations.

David Bloom said, “The manufacturing indices came in weaker than expected in China, Korea, India and Russia, and then we got America’s ISM. We thought we had a clear picture that the US was recovering, Japan was printing money and we’re back to happy days, and now suddenly a huge spanner has been thrown in the works.”

Global shock as manufacturing contracts in US and China - Telegraph

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