Hypertiger is alive...Doctor Stool

The Credit bubble is 64 years old...Well it's older...but the last one in the USA reached maximum potential in 1929 and began imploding or inflating less than pprevious inflation to maximum potential down to 1944-1950...

Once maximum potential was reached the credit began to inflate greater than previous inflation following the the compound interest equation.

"The actual process of money creation takes place in commercial banks. As noted earlier, demand liabilities of commercial banks are money."--Federal Reserve Bank of Chicago, Modern Money Mechanics, p.3

The FEDERAL RESERVE did not exist prior to 1913...But Commercial banks did...

And Credit is not actually money...it's credit...but since it does everything that money does...It's money...The only difference between it and actual money is it's issued (created) by commercial banks when a consumer requests a commercial bank to loan them money...So it starts out as debt owed from the moment of creation...Other forms of money start out debt free and need to be aquired by a lender and have interest attached and then lent out in order for the money to undergo transformation into debt...

So Credit is money and it's also debt.

Every country (economic zone) on Earth has a Credit system and a credit "bubble" since The growth of the bubble is mostly driven by the compounding interest equation at the core of all the accounting algorithms within the compounding interest commercial banking credit system.

But I just look at the USA's...Why?

Because the FEDERAL RESERVE keeps track of the total credit market debt (the amount of debt/credit/money in circulation) and releases the data every quarter.

Also

"730 delegates from all 44 Allied nations gathered at the Mount Washington Hotel in Bretton Woods, New Hampshire, United States, for the United Nations Monetary and Financial Conference. The delegates deliberated upon and signed the Bretton Woods Agreements during the first three weeks of July 1944."

"The Bretton Woods system of monetary management established the rules for commercial and financial relations among the world's major industrial states. The Bretton Woods system was the first example of a fully negotiated monetary order intended to govern monetary relations among independent nation-states."(Economic zones)

It started out by making the US Dollar the Global trade medium of exchange...Fixed to Gold at $35 an ounce and all the other currencies of the world were fixed in price in relation to the US Dollar...The Japanese Yen was fixed in 1949 to be 360 per 1 US dollar and that held until 1971...when the rules of the Bretton Woods game were changed.

Well Bretton Woods made the US Dollar the global trade medium of exchange.

By default it made.

The US consumer the demand of the goods and services of the Global system

The USA the supply of inflation and US consumers the supply of US Dollars.

While the rest of the world became the supply of goods and services for US consumers, The demand for US dollars, and for Inflation.

Because the world at the end of the 1933-1945 bankruptcy reorganization of the previous Global system Based in the British Pound stirling was severely damaged...Europe and most of SE Asia were reduced to smoldering ruin piles.

Well in order for all these economic zones to inflate out of the massive deflation they suffered from...they needed millions of tons of raw materials and finished goods.

from the Global market...and in order to purchase anything off the global market...you need US Dollars...according to the Bretton woods global trade game that everyone agreed to play in 1944

Ok where do US Dollars come from?

"The actual process of money creation takes place in commercial banks. As noted earlier, demand liabilities of commercial banks are money."--Federal Reserve Bank of Chicago, Modern Money Mechanics, p.3

A US consumer requests a commercial bank to advance them x amount of future income using their current income or assets as collateral backing the request.

US consumers request commercial banks to manufacture money.

Lets say to buy a house...a cheap one back then...lats say $5,000...well the bank creates an asset of $5,000 and a liability of $5,000 and attaches interest to the asset and gives it to the consumer...

As the consumer pays off the debt...the asset and liability shrink by the principal amount and the bank keeps the interst as profit...

So the money created and spent into circulation eventually returns to where it came from over time as it's paid off.

It's why the banks like amortization...Because at the start the principal repayment is small compared to the interest payment...and teh economy like it because the mone ycreated circulates for decades.

But anyways...the source of US Dollars...are US consumers...So then if you need US Dollars you need to sell something to the US consumers that they need...or want.

So at the end of the bankruptcy reorganization of world in 1945 massive amounts of raw materials began flooding into the USA at firesale prices...

The world inflated out of the deflation or climax of the 1933-1945 bankruptcy reorganization of the world called world war two very quickly...by the late 1950's the world was basiclly rebuilt

But the USA was dependant upon massive imports of cheap raw materials while the World was dependant upon massive exports of US dollars...but with the world rebuilt...the other economies were as well...So the inreased demand began bidding up the prices of raw materials as the rest of the world inflated more.

Turning the US Trade surplus into a trade deficit and causing the pricing of goods and services in the USA to rise...

No problem...trade deficit?

The USA had lots of gold to balance trade.

According to the Bretton Woods rules US Dollar reserves that piled up in forign central banks due to a trade imbalance could be used to buy Gold from the USA in order to balance trade...

At the start very little gold was changing hands but over time the prices and amount consumed of raw materials continued to rise so the amount of gold needed to balance trade was increasing...Past the point at which the USA actually produced Gold and so by the early 1960's the USA was basiclly hemoraging Gold and the price of silver was bid up so high that the US treasury had to replace all the silver coinage with coinage of cheaper metals so it would not stop circulating/be melted down...and by 1971...The USA was forced to close the gold window and the rules of the Bretton Woods systam had to be changed.

Because according the the rules...Once the USA ran out of Gold...All trade into the USA would have slowed then stopped and then the USA along with the rest of the world would have imploded to oblivion...and nobody wanted the world to implode...Well the USSR maybe.

The rules were changed so that the US Dollar floated against Gold on the open market and all the rest of the currencies floated against the US Dollar on the open market...Then to balance trade the US Dollar reserves could sit or could be exchanegd for US Treasuries...

But the USA was still hyperinflating...It took until the early 1980's for the USA with the help of the authorities to stop the Hyperinflation...by exporting the US manufacturing sector out of the USA...The first place the manufacturing sector was exported to was Japan...which then rapidly inflated to maximum potential and collapsed by the early 1990's...The other location that began accepting massive imports of US consumer debt inflaton...Was the country that Nixon and Kissinger visited in 1972...China.

As the 1980's progresed...The manufacturing sector deflated but the growth rate of the money supply did not and there was very little wage and price inflation in the USA anymore...

If what was done in 1971 was not...Global trade would have stopped and the USA along with the rest of the world would have imploded to oblivion and if the controled destruction of the USA policy would not have been implemented after that...The USA would have hyperinflated and imploded to oblivion sometime in the late 1980's taking the rest of the world up with the USA and then down with the USA into a hyperdeflationary implosion.

Since basiclly 1990 to now the USA and Japan have been combined and have supplied the world with all the money the world needs to keep inflating....

Once final problem...The US consumer...They have a maximum potential ability to use their current income as collateral to back their requests for new money to be manufactured by commercial banks...

Once they max out and either become unwilling or unable to request commercial banks to manufacture the required amount of new money to service the continued existance of the previously manufactured money...that's it...game over.

The Supply of US Dollars slows and then stops...the supply of inflation the rest of the global system demands...slows and then stops...

The USA along with the rest of the world slows then stops or hits maximum potential inflation greater than previous inflation and then begins inflating less than previous inflation to maximum potential.

The USA along with world...implodes...poof.

Which is what you see happening currently...Sub prime mortages and Wall street corruption are effects...of the cause...The cause which is US consumers maxing out and either becoming unwilling or unable to request commercial banks to manufacture the required amount of new money to service the continued existance of the previously manufactured money and the 64 year old Bretton Woods credit bubble...is beginnig to pop...

Due to debt deflation...

"This process of "debt deflation" (a term coined by the early twentieth-century American economist Irving Fisher) was important in the U.S. deflation and depression of the 1930s (Due to a drop in consumer debt consumption) and may have played an important role in the economic problems of contemporary Japan (Due to a drop in consumer debt consumption)."--Remarks by Governor Ben S. Bernanke
Before the Economics Roundtable, University of California, San Diego, La Jolla, California July 23, 2003.

Below is the Bubble...At the top where it looks like its turning...that is only 2 quarters of data so it's not as bad as depicted but...The daily growth rate of the money supply has slowed by 42% or by the greatest amount in 62 years...

Every country on Earth has a bubble that looks basiclly just like the one below....Because the compounding interest commercial banking credit system is the same in every country on Earth...And all are tied to the US consumer...US consumer maxes out...and the US bubble pops...and all the bubbles on Earth pop.

The compounding interest commercial banking credit system is 600+ years old...

The 1929-1933 collapse followed by the 1933-1945 bankruptcy reorganization...was caused by the popping of a much smaller global credit bubble...

All they did in 1944 was the same thing over again basically except they were able to keep it going 6 times longer than the roaring 20's...This current bubble is the roaring 6 decades.

It's the largest credit bubble in History...