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In 1944 at the tail end of the 1933-1945 bankruptcy reorganization of the Global trade system Bretton Woods made the US Dollar the Global trade medium of exchange taking over from the British pound sterling and by default the US consumer became the demand of the global system taking over from the British.
The US consumer is the demand of the world while the rest of the world is the supply.
The USA is addicted to imports?
WELL GUESS WHAT?
THE WORLD IS ADDICTED TO EXPORTS...Duh
Argentina has to destroy the value of its currency so that importers can afford their exports.
Argentina sends its exports to...
Brazil 19.1%, China 9.4%, US 7.9%, Chile 7.6%
Brazil sends its exports to...USA Number one consumer of Exports.
US 16.1%, Argentina 9.2%, China 6.8%, Netherlands 5.6%, Germany 4.6%
China sends its exports to...USA Number one consumer of Exports.
US 19.1%, Hong Kong 15.1%, Japan 8.4%, South Korea 4.6%, Germany 4%
Chile sends its exports to...
China 14.8%, US 12.5%, Japan 10.5%, Netherlands 5.8%, South Korea 5.7%, Italy 5.1%, Brazil 5%
Basically every economic zone on Earth has The USA as its Number one consumer of Exports or its number one consumer of exports has the USA as its number one consumer of exports.
Japan send its exports to...USA number one consumer of exports
US 20.4%, China 15.3%, South Korea 7.6%, Taiwan 6.3%, Hong Kong 5.4%
South Korea sends its exports to...
China 22.1%, US 12.4%, Japan 7.1%, Hong Kong 5%
Taiwan send its exports to...
China 32.6%, US 12.9%, Hong Kong 8.6%, Japan 6.4%, Singapore 5%
The largest consumer of the European Union's exports is the USA.
It's why WORLD trade collapsed by nearly 45 per cent in annual terms in the final three months of last year, according to the International Monetary Fund figures.
US consumers are maxed out...
Deflation is the word generally used to describe the observation of inflation less than previous inflation.
The USA within the context of the 1944 Bretton Woods global trade system has been inflating greater than previous inflation since then
Or 65 years.
That is coming to an end and the USA along with the rest of the global system is going to begin inflating less than previous inflation to maximum potential once the maximum potential of inflation greater than previous inflation is reached.
Civilization as you know it...Is going to deflate.
Hyper look...The price of this item has risen how do you explain that?
Simple...More demand for that item than supply.
Gold dropped today?
Did the supply of money shrink in relation to supply or did the demand shrink in relation to supply?
The money supply is still growing by about 5.6 Billion dollars a day so it's not a money supply problem.
Increasing the money supply is nice and all but you need people out there spending it...
Two houses and three cars not enough?
What's the FED going to do?
Buy everything and then increase the price by 5% and sell it all to itself again?
ALL OF YOU DRIVE THE ECONOMY...not a magic printing press.
And if you all can't drive the economy higher...
THEN IT'S GAME OVER.
There will be nothing to prevent you all from transforming from assets into unfundable liabilities that will have to be liquidated one way or the other.
The gold price will be driven by its small supply in relation to demand, the already existing 200 Trillion global money supply, and mindless animals desperate for yield by buying high and selling higher.
GOLD is mostly a useless metal that The top discovered a use for 1000's of years ago...Construction of money that is very hard to counterfeit because GOLD is so scarce.
How does that work?...Below is a hint.
The purpose of the Police and military is to protect the top from the bottom...To protect cause from consequence...The easiest prey of the hunter gatherer is the farmer and the simplest operation is the protection scheme...You are either with us or against us...All money is decreed money...fiat...
The top says this is money...Or else...period end of story....
You Farmer are on the Land owned by the LORD of the land and will pay tribute to the LORD of 1 Gold coin a year...
Where do I get this GOLD coin?
You can take one short ton of grain to the grainery of the LORD and there you will be given a GOLD coin for it and then you can give the gold coin to the servant of the LORD...
What if I refuse?
Then the LORD will drive you from the Land that the LORD is the LORD of...
There you go an abundant supply of free food to power your wildest hopes and dreams...Lies and delusions...
22 And the LORD said, Behold! The man has become as one of Us, to know good and evil. And now, lest he put forth his hand and also take from the Tree of Life, and eat, and live forever,
23 The LORD sent him out of the garden of Eden to till the ground out of which he was taken.
24 And He drove the man out. And He lodged the cherubs at the east of the Garden of Eden, and the flaming sword whirling around to guard the way of the Tree of Life.
Well what is done with all that Food the tillers of the LORD's land give the LORD as Tribute?
It powers the Absolute capitalist Hierarchial food powered make work enterprise...
The city state...Or Civilization...The thing you all popped into existence out of thin air within...the thing you did not create or own that you are in right now.
The above is how GOLD obtains its value.
Because the top owns all the money...and the bottom rents...All that you see is just an illusion to keep you paying the rent.
You are all chattel slaves period end of story.
Governments?
Are just administration systems of the Absolute capitalist hierarchial food powered make work enterprise.
The whole thing is owned by the top...the bottom pays the rent to the top.
Imagine if you owned everything...you would pay all the employees and they would blow their paychecks into the system and you would get all the money you paid the bottom back...
But what if the employees ask for more compensation?
Well the top has to raise the price of everything the bottom buys with their paychecks in order to increase the paychecks the bottom receives if the bottom demands more compensation from the top.
Banks?
Currently a consumer uses their current income which is mostly previously manufactured money as the collateral backing their request for a commercial bank to manufacture new money.
Without banks there's no effective way to expand the money supply.
A consumer knows how much they need to expand the money supply by...
Average bank prime loan rate is 3.25% so at 2% they are getting 1.25%
30 year fixed mortgages are around 5%.
The Banks only borrow money from the Federal Reserve if they have to...
Federal Funds until 2008 before the crisis was just an interbank overnight lending rate...
The commercial banking system does not need the Federal Reserve...The commercial banking system in the USA operated from 1836 until 1913 without any sort of Central bank...Ultimately all that the FEDERAL RESERVE was given in 1913 was the banknote monopoly...Prior to that all the banks in the USA issued their own banknotes...
The FEDERAL RESERVE can be abolished...The key to the system is the 600 year old compounding interest commercial banking credit system.
Every commercial bank in the world for the past 600 years was just a mini federal reserve.
The system is based on taking more than is given...or chopping down trees faster than they regrow.
Continue until the trees run out = game over.
Stop before the trees run out = continue until the trees run out = game over.
The logical conclusion of the compounding growth equation is reached sooner or later.
In Zimbabwe the hyperinflation at the start sucked out most of the savings of gold and silver into circulation by people trying to sustain their existence...the trade deficit then caused all that gold and silver to circulate out and to not come back.
Currently all that is happening in Zimbabwe is the Government is issuing more and more money to pay for all the bonds it's issuing...
Following that path...The gold and silver bugs would begin having to spend their savings trying to survive until they were basically all gone...
Then once all the gold and silver was sucked out of the hands of the renters to the owners...hyperinflation would rocket.
None of you are owners unfortunately...
You mindless morons are so desperate...all it takes is the FED to mention that they are going to buy bonds...and all the inflationists begin to march in lockstep.
But the FED is going to avoid following the Zimbabwe path...Well not at first of course...They have to at least load all the suckers up on troop ships before they send them into the torpedos.
The FED has been threatening to hyperinflate for 7 years now...All the devout followers of the hyperinflationary jackpot religion think they are closer now than ever.
Everyone...The mindless morons...will leverage long...and once all you clowns are in...the top will short you all to oblivion and extract all that the mindless morons put in betting that this time is going to be the hyperinflationary jackpot.
Hyper why did AIG and the banks go bust?
Because they bet that inflation was going to last forever...and lost.
It's why the real estate sector collapsed.
The hyperinflationary jackpot bet was wrong...But the inflationists never seem to want to explain it.
It's just a classic case of the just think positive ignore the negative religion in action...or the just think inflation ignore deflation religion.
They just keep looking at Zimbabwe and dreaming about panning for gold all day to afford to buy a large muffin being marketed as a loaf of bread.
The implosion of the 1944 Bretton Woods global trade system is not a theory...it's a fact playing out...day in and day out...week after week...right in front of everyone's eyes.
And as far as I can tell...The implosion is just at the very start...before we reach bottom all these servers hosting all these sites will shut down.
The fact that you are reading this is proof that we have a long ways to go before we reach the point where all the stuff you all currently can't comprehend begins to unfold.
When the so called US dollar collapses...What are all you gold and silver speculators going to use to buy Gold and silver?
Gold and silver?
No...So get ready to kiss the good old days goodbye.
The USA is dependant upon imports...Gold and silver that does enter circulation will circulate out and not come back.
Unless you idiots can produce something everyone needs or wants or know how to put in an actual honest days work...you are going to be in serious trouble soon.
The days of dreaming you are all awake are coming to an end...At some point you will all be forced to wake up into the nightmare.
Really...You all are going to actually be taught what the word miscalculation means.
Unfortunately since you are mortal...you are going to cease to exist and your descendants will be just as oblivious as you are currently.
Really every one of you is going to drop dead and the rest will just make a slight detour to avoid tripping over your corpse on the glorious march to doom with glee.
All the FED has done is kick the ant hill...
And look at you all go...fools.
You are all under complete control.
For the last 7 years now...Ben farts and says the flowers sure smell nice and you all think you smell roses...It's a comedy watching you all.
The elected officials?
Are not the top or owners...
The top installs the people you think are leaders so that they suffer the consequences.
Governments of the absolute capitalistic hierarchial food powered make work enterprise are administration systems of the enterprise constructed and sustained by the bottom or employees at the demand of the top or owners of the absolute capitalistic hierarchial food powered make work enterprise
US consumers reached their maximum potential to consume real estate in 2006 which was the engine flooding the economy with the money that the Global trade system was depending upon.
In 1944 Bretton Woods made the US Dollar the global trade medium of exchange and by default the US consumer became the demand of the global trade system and everyone else the supply.
And over the past 65 years the rest of the world has grown more and more dependent upon the US consumer to sustain the World.
The money that then bailed out of real estate late 2006 to 2007 jumped into stock and commodities markets...
Then it jumped out of there into the bond markets.
Meanwhile the real estate sector imploded further slowing the amount of new money consumers were requesting the commercial banking system to manufacture...by the most in 65 years...
With Billions of Dollars of new money a day not showing up anymore...Spending had to be cut back and the consumption of imports collapsed.
Basically the massive flood of US consumer debt inflation out into the rest of the global system to keep it inflated...slowed down causing the rest of the global system to begin collapsing.
What just popped was a bubble within the bubble.
The FED did not cause the housing bubble...100's of millions of idiots globally attempting to escape their pathetic existence on Earth by gambling were the cause.
The sub prime collapse is just an effect.
It's the logical conclusion of the compounding interest equation the braindeads worship. Attaching interest or a growth rate to money causes an increase in demand for more that compounds to the point that there is no way for the demand to be supplied.
Eventually it becomes impossible for the economic system to sustain the required amount of inflation greater than previous inflation and inflation greater than previous inflation to maximum potential transforms into inflation less than previous inflation to maximum potential.
Basically the real estate sector in the USA...The Number 1 inflationary engine on Earth reached maximum potential inflation greater than previous inflation and collapsed...(began inflating less than previous inflation) causing the weakest of the sector to implode...the sub primes...but even if they did not exist...the real estate sector in the USA was doomed regardless.
When braindeads wonder what is going on...
The sub prime mortgages which are an effect of the cause of the collapse are marketed or sold by the mass media as the cause of the collapse..and the braindeads bought it.
Don't worry the best case for the worshipers of the hyperinflationary jackpot is...a massive hyperinflationary explosion followed by a hyperdeflationary implosion to oblivion.
The worst case scenario for the worshipers of the hyperinflationary jackpot...a continued slow/controlled crumble to oblivion.
Anyway it's sliced and diced...the logical conclsuion is the transformation of many billions of current assets (You all) into unfundable liabilities that will be liquidated one way or the other.
You all actually think you support yourselves?
You all want incomes...the top created this wonderful system to supply you all with what you want.
One problem...
You all want more and more and more but it's impossible to sustain what you all want forever...
The last 65 years has basically been one huge global hyperinflationary blowoff top.
It's all just been hidden up to this point by accounting tricks to keep wages and general prices from hyperinflating...
The Government creating massive piles of money you say?
There is no evidence at all that the money supply is expanding at a faster rate than it was in 2007.
Real estate in the USA is still the primary engine of inflation of the global economic system...all the other inflationary engines derive their energy from it.
Until the US real estate sector begins to produce sales volumes and prices as it was in 2006...there will be no way to escape the current slow crumble to oblivion.
People can refinance the debt at lower interest rates.
Generally with real estate that is the case...but the asset has to be worth what is owed for that to work.
If you owe $200,000 and the asset backing the debt drops in price to $190,000...you can't refinance.
Just because rates drop does not mean that consumers can request enough new debt.
Consumers that are basically maxed out can not request more...or enough to reflate out of a recession...
Enough consumers in such a position and there is basically no way to reflate out of a recession and the recession collapses into a depression.
Like really you can lower the price of food to zero...once the consumers are full they will stop eating.
How the easing worked in Japan was a trade agreement was made with the USA basically combining Japan and the USA...The bank of Japan bought Japanese bonds to basically drive yield rates to 0.1% and subsidized Japanese export dumping in the USA...
Yen were buying Dollars and Treasuries to keep US rates down but the dollar strong so that Japanese cars and other exports to the USA were affordable.
But rates at 0.1% required massive volume to support.
Lets say you need $100 to run your empire...well then at 10% you need to lend out $1000 to obtain that yield
at 5% you need $2000
2.5% $4000
1.75% $8000
0.88 $16,000
0.44 $32,000
0.22 $64,000
0.11 $128,000 has to be requested by consumers to be created to derive a yield of $100
Now imagine you need a yield of Trillions...and the US consumer after decades maxes out...poof game over...your exports collapse.
Remember they said something awhile back about the Yen carry trade ending...
Because the top knew that once US consumers reached the maximum potential of supporting it...It would be game over.
Like really you can lower the price of food to zero...once the consumers are full they will stop eating.
The USA is not going to turn into Japan...It does not have an export to the rest of the world based economy like Japan had before the Bank of Japan began to engineer rates.
The consumers are maxed out...
It's like a richman riding a horse at full gallop until the horse becomes exhausted...the richman dismounts and begins whipping the horse to get it to move...but it does not and eventually is whipped to death and drops dead.
Stupid lazy horse.
After 65 years of galloping at full speed...The US consumer has basically become exhausted, stopped and is about to be whipped to death.
Supply and demand...
Everyone in the system is in debt...The producers will be forced to flood the markets to obtain what they need to service the debt at some point.
Then there are savings...You all don't have enough savings to survive for long without earning some kind of income...
Stage 3 of a compounding interest system...Is bankruptcy of the banks, collaspe of the economy/division of labor, and the consolidation of power.
Sure the money supply is not going to shrink to zero but it will stop circulating...
You have to do something to obtain a positive income...The money will not circulate until you transform from an unfundable liability into an asset again.
Employees are employed because they give more than they take...as soon an employee begins taking more than they give...
They transform from being an asset into an unfundable liability and need to eventually be liquidated one way or the other.
At some point the pool of unemployed labor will cause wages to drop.
Busts generally last as long as the boom that preceded it.
You know like a wave...Where the inflation greater than previous inflation to maximum potential phase is equal to the inflation less than previous inflation to maximum potential phase.
It took basically 65 years to inflate up to this point it will take basically as long to deflate down.
Most of you will be dead and this board long gone before we reach the bottom.
Unless something is done to accelerate the implosion of the global trade system.