The general public is not really buying the whole package just yet, at least not everywhere and in every country. Not even low level primates will believe things are getting better if hearing it from politicians that rate low in confidence and articulation in the eyes of their constituencies. But the more these sentences are cabled out and the more those in charge can point to graphs showing that the GDP descent is stopping or that the numbers are even growing again, the more the idiots will believe. We “humans” (using the term loosely since most of you do not deserve that epithet) may call our belief “common sense” or what “everyone knows,” without realizing that we’ve come to believe it simply because it’s all we ever hear. It may never even occur to us to question an axiom — especially if we never hear about the evidence which contradicts or disproves it. With Internet this has gradually changed, what we hear and see is not only from mainstream journalist or politicians anymore. Instead it can be the grandma next door or some Iranian students telling us the news and this faster and – often enough – better than those with power would like. This is of course the reason behind all the restrictions, laws and monitoring being put in place by governments everywhere. What if people actually found out that: there is not one single evidence for man-made global warming? What if citizens read about how the banking system and money really works? What if large groups actually understand how deeply imbedded in dung we really are?
Some infectious amebas claiming to be well versed in economy or how the financial system work have recently claimed that people are buying stuff again and that prices going slightly up is signs of recovery. Well if the interest rate is practically zero and the government throws newly printed money at people together with the same government hiring thousands on borrowed money, what will happen? The recession isn’t so bad just yet, those with power is claiming it is over or soon will be over and it’s really cheap taking a loan, what will people do? That’s right, they go out shopping. You do not need a university degree in economics to understand this; in fact it is useful not having one since you then are not indoctrinated with Keynesianism and mad ideas about inflation. And what are those “green shoots” in the economy they are seeing? The stock markets for one. Stocks have climbed up from a very low level and even if they have leveled out recently the positivism is contagious. Of course they are not telling anyone that almost all of the trillions of dollars pouring into the system are primarily going to the financial system. So what do you think happens when a certain sector suddenly gets a big boost in money supply and interest rates are very low? That’s right, they start shopping hence prices (or stock “value”) goes up. The other “green shoot” they are seeing is that GDP is not losing ground as much anymore. According to mainstream cornflake-economists and those in charge GDP is the most important measurement of wealth so if the fall halts it is a good sign. But in the real world GDP is sketchy at best. Even if we ignore the fact that things like snowfall, building weapons or even digging a hole in the ground will increase GDP there is still one interesting fact we are not being told: spending money counts, huge loans does not. Isn’t this a nice little plot eh? So the government – and everyone else – going on a spending spree will contribute to GDP, the loans will not (at least not direct) be counted into GDP as a minus. This is why people like me could, several years ago, say that we were heading for a recession, we knew. You cannot borrow and spend, borrow and spend, you also need to produce. The spending comes from production, not the other way around as we are being told.
Can you see what’s going on here and do you really understand what I just told you? It is a gigant Ponzi-scheme and if you do understand you also know that the recession is far far, very far, from over. In fact the recession will not only continue; it will worsen. To double the amount of money in a country in a matter of months, lower interest rates to zero and impose more laws and then say the crisis is over because people buy things is madness, complete and utter madness but this they want us to believe. I have earlier predicted that this current recession will became a full blown depression in the beginning/middle of next year, I see no reason whatsoever to change that forecast. Instead if things escalate in the Middle East or something more happens with, say…, the dollar, the depression might even come sooner.
I have from early on urge those out there with some brain-capacity to start hording dried-up food packages, candles, guns and other useful tools for survival. I have also pleaded that you do not buy anything that holds your cash like houses or real-estate or similar items that not easily can be left behind or converted into useful things. Now when the market is still willing to buy, sell your house, sell your apartment, rent instead. Not only might you earn money selling now, you will also earn money in the long run since it is cheaper renting than buying. I know many of you do not believe me, Peter Schiff, Marc Faber or many others that is sending out warnings but please remember, you did not believe us a year ago or two years ago. Can you really afford not listening this time?
We are heading for a fall, quite possible the worst disaster ever known to man. If you sit there in a couple of years from now with sky-high interest rates, no job and the world crumbling all around you, don’t ask for my help. I won’t. I will only tell you four words: I-told-you-so
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