telegraph
Statement:
The Pirate Party UK are proud to announce that they have completed the Electoral Commission's party registration process, and are now officially recognised as a British political party.
The Pirate Party UK is are now accepting memberships, and will be fielding candidates in the next General Election.
The party will campaign on a platform of copyright and patent reform, setting limits on surveillance of the public and increasing our freedom of speech.
The Party wants to legalise non-commercial filesharing, reduce the term of copyright from the current life plus 70 years, and abolish patents on drugs.
Pirate Party leader Andrew Robinson says "The Pirate Party offers an alternative to the last century's struggles between political left and political right. When a government plans to brand 7 million British filesharers as criminals, to profile every citizen, to track our movements, register every email we send and every website we visit, and to carry on allowing big business to lock up life saving drugs and environmentally beneficial technologies under an ever-growing mountain of patents, Britain desperately needs a party that fights back. We know these laws can be hanged, must be changed and will be changed."
Notes for Editors:
The Pirate Party UK is the sister party to well established Pirate Parties in Sweden and Germany. In the last European elections, Swedish voters elected the first Pirate Party MEP. The German Pirate Party has an MP in the Bundestag and is an officially recognized party eligible for state funding.
Pirate parties also exist, or are in the process of formation in Argentina, Australia, Austria, Belgium, Brazil, Bulgaria, Canada, Denmark, Finland, France, Greece, Ireland, Italy, Lithuania, Luxembourg , The Netherlands, New Zealand, orway, Peru, Poland, Portugal, Romania, Russia, Serbia, South Africa, Spain, Switzerland, Ukraine and The United States.
Tuesday, August 11, 2009
The ”green shoots” about to turn into tears
What people need to realize is what’s really going on out in the real world. I have written a lot about America and Sweden lately but there are many other hilarious things to keep track of.
About 6 months ago I urge you all to keep a close eye on China because I knew that fictive growth in that country sooner or later would spill over and come crashing down. Today the Telegraph has an excellent article on this topic saying, among other things, that the giant Ponzi scheme is risking to break down in the near future. What people do not realize is that China has growing GDP because of two things. The first being the massive trade surplus that accounts for 40% of the economy, the second is the credit expansion and massive injection of founds from state companies. Even if things like typhoons will help to boost the GDP numbers it isn’t enough with falling trade numbers and the fact that the Chinese need to pull back a lot of the credits in the system. Worse still is that most of those credits have ended up in equity markets which have increased the Shanghai index that is up 80% this year. In other words the Chinese stock market is in the same state as the American (and most others) and thrives upon fictive numbers that sooner or later will come crashing down. In the Telegraph article, quoting a leading financial consultant, he is saying that Chinese Equities are overvalued by 50% to 100%. I actually think this is an underestimate and that the percentage is even higher. To this we need to add that China is the main reason why the dollar hasn’t collapsed yet, buying massive amounts of US treasuries and in doing so helping the Obamination with his scheme. Although China is putting large sums to pretty good use, improving communications and investing in production capacity, which will help them out in the future, things look very grim and with the knowledge that several Chinese provinces are close to regular rebellions we have a fine little mess that will help the depressional tsunami-wave along in a nice way.
Eastern Europe has been in big trouble longer than most of the Western counterparts with mainly the Baltic States and the Balkan showing horrible numbers. In Hungary this has lead to very shady characters gaining power and the same goes for Ukraine. Now Russia is also showing massive contractions in the economy dropping almost 11% during the second quarter (9% during the first). What you need to know is that Russia has not been throwing the same massive stimulus packages into the economy like the US or China which means their economy is showing more real numbers. I do expect that the Russian leaders will do what Russian leaders always have done - increase their power to crack down on any hints of uprisings and demonstrations. However, this time around it might actually not work. The Russian people have, for the first time in history, tasted some level of freedom and I hardly see tens of millions of people bend over and take it like before.
In Africa the looming famine catastrophe is getting more imminent. In Kenya the government estimates that at least 10 million Kenyans - one third of the population - is in need of food aid. Similar numbers can be shown for several other countries in the region and this will sooner or later tip over to utter starvation because when the worldwide depression keeps rolling along aid and trade from other countries will diminish and most of the African countries are not equipped to handle such an situation. I have earlier predicted that millions of people will starve to death in western and southern Africa in the near future and I see no reason to alter that forecast.
These are just three other situations you need to keep an eye on, there are many others. All I’m waiting for now is that main trigger(s). With an absolute certainty the dollar will default and in most likelihood collapse, we have way overpriced equity markets all around the globe and the housing market in the US has yet to bottom out. In the wake of companies going bankrupt and fictively low interest rates commercial real-estate might very well also go down very soon. But the main trigger(s) might very well be another war in the Middle East or another very large company like GE or Microsoft to show high loses, so look for those kinds of signs.
All mentioned (and many more) can be linked together so when you see or read some cornflake economist or your politician stating that unemployment isn’t dropping as fast anymore, some companies are starting to show profits or that the stock market is recuperating or whatever bamboozle they are trying to sell, don’t listen. The main scam they are trying to advertise right now is that GDP is not dropping as fast or even going up - this is total madness. GDP can be improved by digging holes in the ground and filling them back up again over and over; only an insane person can regard GDP as a good measure of the economy. The only thing that has been done with all those stimulus’s and bail-outs is to temporary, and fictively “halt” the decline. Under the surface, just like a tsunami in the middle of the ocean cannot really be detected, the depression is gaining momentum now fuelled by inflation and souring debts along with way overvalued stock markets. When that tsunami hits the shoreline and all those sand-castles come crumbling down, don’t be surprised. There is enough information out there and if you are not prepared for it you deserve whatever you get.
About 6 months ago I urge you all to keep a close eye on China because I knew that fictive growth in that country sooner or later would spill over and come crashing down. Today the Telegraph has an excellent article on this topic saying, among other things, that the giant Ponzi scheme is risking to break down in the near future. What people do not realize is that China has growing GDP because of two things. The first being the massive trade surplus that accounts for 40% of the economy, the second is the credit expansion and massive injection of founds from state companies. Even if things like typhoons will help to boost the GDP numbers it isn’t enough with falling trade numbers and the fact that the Chinese need to pull back a lot of the credits in the system. Worse still is that most of those credits have ended up in equity markets which have increased the Shanghai index that is up 80% this year. In other words the Chinese stock market is in the same state as the American (and most others) and thrives upon fictive numbers that sooner or later will come crashing down. In the Telegraph article, quoting a leading financial consultant, he is saying that Chinese Equities are overvalued by 50% to 100%. I actually think this is an underestimate and that the percentage is even higher. To this we need to add that China is the main reason why the dollar hasn’t collapsed yet, buying massive amounts of US treasuries and in doing so helping the Obamination with his scheme. Although China is putting large sums to pretty good use, improving communications and investing in production capacity, which will help them out in the future, things look very grim and with the knowledge that several Chinese provinces are close to regular rebellions we have a fine little mess that will help the depressional tsunami-wave along in a nice way.
Eastern Europe has been in big trouble longer than most of the Western counterparts with mainly the Baltic States and the Balkan showing horrible numbers. In Hungary this has lead to very shady characters gaining power and the same goes for Ukraine. Now Russia is also showing massive contractions in the economy dropping almost 11% during the second quarter (9% during the first). What you need to know is that Russia has not been throwing the same massive stimulus packages into the economy like the US or China which means their economy is showing more real numbers. I do expect that the Russian leaders will do what Russian leaders always have done - increase their power to crack down on any hints of uprisings and demonstrations. However, this time around it might actually not work. The Russian people have, for the first time in history, tasted some level of freedom and I hardly see tens of millions of people bend over and take it like before.
In Africa the looming famine catastrophe is getting more imminent. In Kenya the government estimates that at least 10 million Kenyans - one third of the population - is in need of food aid. Similar numbers can be shown for several other countries in the region and this will sooner or later tip over to utter starvation because when the worldwide depression keeps rolling along aid and trade from other countries will diminish and most of the African countries are not equipped to handle such an situation. I have earlier predicted that millions of people will starve to death in western and southern Africa in the near future and I see no reason to alter that forecast.
These are just three other situations you need to keep an eye on, there are many others. All I’m waiting for now is that main trigger(s). With an absolute certainty the dollar will default and in most likelihood collapse, we have way overpriced equity markets all around the globe and the housing market in the US has yet to bottom out. In the wake of companies going bankrupt and fictively low interest rates commercial real-estate might very well also go down very soon. But the main trigger(s) might very well be another war in the Middle East or another very large company like GE or Microsoft to show high loses, so look for those kinds of signs.
All mentioned (and many more) can be linked together so when you see or read some cornflake economist or your politician stating that unemployment isn’t dropping as fast anymore, some companies are starting to show profits or that the stock market is recuperating or whatever bamboozle they are trying to sell, don’t listen. The main scam they are trying to advertise right now is that GDP is not dropping as fast or even going up - this is total madness. GDP can be improved by digging holes in the ground and filling them back up again over and over; only an insane person can regard GDP as a good measure of the economy. The only thing that has been done with all those stimulus’s and bail-outs is to temporary, and fictively “halt” the decline. Under the surface, just like a tsunami in the middle of the ocean cannot really be detected, the depression is gaining momentum now fuelled by inflation and souring debts along with way overvalued stock markets. When that tsunami hits the shoreline and all those sand-castles come crumbling down, don’t be surprised. There is enough information out there and if you are not prepared for it you deserve whatever you get.
Rapist fun
Apparently a man in southern Sweden tricked a woman to his apartment and raped her. The female in question tried to convince the man to, at least, put on a condom, and he probably should have listen since the woman had HIV. Besides a year or so inside one of Sweden’s resorts this rapists now also await his physicians’ verdict.
This is hilarious stuff and even if I feel sad for the woman I do hope she is rubbing her hands together going “Muhahaha…” whenever she gets the chance.
And strangely enough I have not heard or read anything about some government official claiming the victim should have warned the rapist. It is probably against the law not to do so. And it would not surprise me even a wee bit if the rapist ass-hole files a law-suit not matter if he gets infected or not. It was a traumatic experience for the poor sod I’m sure…
This is hilarious stuff and even if I feel sad for the woman I do hope she is rubbing her hands together going “Muhahaha…” whenever she gets the chance.
And strangely enough I have not heard or read anything about some government official claiming the victim should have warned the rapist. It is probably against the law not to do so. And it would not surprise me even a wee bit if the rapist ass-hole files a law-suit not matter if he gets infected or not. It was a traumatic experience for the poor sod I’m sure…
Buy Gold now
I have written so many times about gold at this point that it’s starting to get ridiculous. But as someone - in contrast to almost all others including gurus at certain banks - I actually predicted both the current start of the depression and the price of gold so do feel I once again need to say something on the subject. Gold is still a fantastic investment. I have seen people, others with brains, whom claim that gold will top around $5000 per ounce. I do not think it will reach that high, but with absolute certainty it will reach $2000 within a year or so which means over 100% profits if you buy now.
But I would not merely advice you to buy gold for economic profit, it is equally or even more important to part have a safe investment and part hold real value. Any kind of paper asset is too big of a risk. The stock markets will crumble and go way down in the near future (those are outrageously inflated at the moment), bonds are terrible on so many levels and currencies might be the biggest trap of them all. What we can be sure of is that oil prices will go up and since any kind of food commodities will become scarcer in the future those kinds of investments also hold value. But all things considered, gold and silver should be your main targets and you really should buy those now. There are some that argue that gold already have peaked, which is, of course, nonsense. When the dollar collapses and the next much bigger tsunami-wave of this depression hits us, gold will go through the roof. And to this we can also add the market manipulations that we can see from certain financial institutes that keeps the prices on gold and silver down. In reality Gold actually have a higher price at the moment.
This is certainly not the best advice I have or will give you all, the best is still to hoard dried up food packages, candles and guns, but in order to hold some true value in your hands that will always be of use you really should buy precious metals. If you had listen to me 10 years ago, you would have had 300% profits on gold by now, if you had listen 7 months ago when I started this blog you would have earned close to 30% on gold. And since I can prove I accurately have predicted almost every single thing with this depression so far, who are you going to listen to?
Get it together people; it is coming, just around the corner it lurks, the biggest depression and upheaval in human history. Please don’t own stocks or any other stupidity, buy Gold and do it now.
But I would not merely advice you to buy gold for economic profit, it is equally or even more important to part have a safe investment and part hold real value. Any kind of paper asset is too big of a risk. The stock markets will crumble and go way down in the near future (those are outrageously inflated at the moment), bonds are terrible on so many levels and currencies might be the biggest trap of them all. What we can be sure of is that oil prices will go up and since any kind of food commodities will become scarcer in the future those kinds of investments also hold value. But all things considered, gold and silver should be your main targets and you really should buy those now. There are some that argue that gold already have peaked, which is, of course, nonsense. When the dollar collapses and the next much bigger tsunami-wave of this depression hits us, gold will go through the roof. And to this we can also add the market manipulations that we can see from certain financial institutes that keeps the prices on gold and silver down. In reality Gold actually have a higher price at the moment.
This is certainly not the best advice I have or will give you all, the best is still to hoard dried up food packages, candles and guns, but in order to hold some true value in your hands that will always be of use you really should buy precious metals. If you had listen to me 10 years ago, you would have had 300% profits on gold by now, if you had listen 7 months ago when I started this blog you would have earned close to 30% on gold. And since I can prove I accurately have predicted almost every single thing with this depression so far, who are you going to listen to?
Get it together people; it is coming, just around the corner it lurks, the biggest depression and upheaval in human history. Please don’t own stocks or any other stupidity, buy Gold and do it now.
Monday, August 10, 2009
A pin cushion please
Some lowlife ‘liberals’ from Sweden’s capital Stockholm is arguing that taxpayers should pay for drug addicts syringes. Different types of Needle Exchange Programs have been tried here and there, mostly with slight improvements comes to the spread of HIV and hepatitis. In other words studies show this to be a so so way of improving health and minimizing the risk of getting diseases among needle loving freaks.
But if these people, and others, really want to help drug addicts and minimize risk, they should, of course, promote legalization. If drugs were legal they would be cheaper hence more money over for other things, like needles. If drugs were legal they could be bought at any convenient store and consequently be cleaner and come with direct instructions. With legality we would also reduce crimes because the hunt for drugs and money to buy drugs would go down and most mafia organizations would find themselves without an income. In other words if drugs were legal it would lower both the risk of infections and health costs, and it would reduce overdoses and save lives. Since every person should be their own king and decide what they want to do with their own bodies, each and everyone is also liable for what they eat or inject. Consequently any syringe purchases is also totally up to the individual.
And why should anyone be forced to pay for other human's that like to put needles into their bodies?
If some idiot feel the urge to perform a needle contest with his or her own flesh, let ‘em, but don’t expect me, or anyone else to pay for such stupidity. Legalize it instead and let people be however stupid they want to be.
But if these people, and others, really want to help drug addicts and minimize risk, they should, of course, promote legalization. If drugs were legal they would be cheaper hence more money over for other things, like needles. If drugs were legal they could be bought at any convenient store and consequently be cleaner and come with direct instructions. With legality we would also reduce crimes because the hunt for drugs and money to buy drugs would go down and most mafia organizations would find themselves without an income. In other words if drugs were legal it would lower both the risk of infections and health costs, and it would reduce overdoses and save lives. Since every person should be their own king and decide what they want to do with their own bodies, each and everyone is also liable for what they eat or inject. Consequently any syringe purchases is also totally up to the individual.
And why should anyone be forced to pay for other human's that like to put needles into their bodies?
If some idiot feel the urge to perform a needle contest with his or her own flesh, let ‘em, but don’t expect me, or anyone else to pay for such stupidity. Legalize it instead and let people be however stupid they want to be.
Congrats princess
Despite leaning towards the libertarian persuasion I still do possess a small degree of conservatism and consequently I feel very happy today when it was announced that the magnificent and very beautiful Swedish Princess Madeleine - Duchess of Hälsingland and Gästrikland, (Madeleine Thérèse Amélie Joséphine) – have announce an engagement with her long time boyfriend.
I know I should be advocating an abolishment of the Royals. Such an archaic institution is a symbol of dictatorship and hardly even has a place in fairytales, but it is part of our history and let’s face it; with a sexy hot woman like this who could even think about taking away her tiara? And I need to admit, her boy-toy is a handsome devil so I see sexy little cherubs popping out in the future.
The only thing that disturbs a little now when both Swedish princesses have chosen a “man of the people” to wed, is that this take away some of the reason and mystery of the royal family. To much commoner blood my conservative vein shrieks, but on the other hand, comes the revolution those things hardly matter.
Anyway, congrats ‘Madde’ and get of those pills – the hallways of the royal palace need the sound of tiny feet’s going pitter patter.
Stolen picture from Aftonbladet:
Things about to get nasty in Iran?
Khamenei has now, apparently, approved an arrest warrant against Mousavi, which could be enforced at any moment by the Revolutionary Guards. I have seen this here and there on the net and if this is true, it is very likely that bloodshed is imminent. Iran might be about to explode and I cannot helpt to wonder what this will do to oil prices… Sure the dictator Hugo Chavez might be happy for a short while, but otherwise? And what will the rest of the world do? The Obamination couldn’t be disturb from his nap in the cellar during the last big Iranian protests, will he get up from his coffin this time?
This news, among other places, can be read here: Pajamas Media
This news, among other places, can be read here: Pajamas Media
Oh yes...
Now and again we see signs of good people doing what is right, also here in the UK. Hazel Blear resigned the post of Communities Secretary in June after avoiding a tax bill of £13,000 regarding the sale of a flat in London. But this representative of the enemy class is still Salford MP and is apparently out knocking doors for local support.
After one such attempt to fool a couple of idiots, she got back to her car and found it thrashed. Apparently slashed tires, broken windshield and some marks have been made. According to interviews made all those living in the area were fully aware of whose car it was. A joint effort maybe?
After one such attempt to fool a couple of idiots, she got back to her car and found it thrashed. Apparently slashed tires, broken windshield and some marks have been made. According to interviews made all those living in the area were fully aware of whose car it was. A joint effort maybe?
Obaminational shoots
While the grass rot movements in the US against big brother and the manic spending spree is gaining momentum - more and more voices are heard from the governing administration claiming the recession is nearing its end. More and more governors and senators are being booed of the stage and getting threats at the same time as Washington is, louder and louder, proclaiming that we are seeing “green shoots”. A strange coincidence?
Lets us look at what two of these funny clown administrators from Washington have said recently.
Here is the first one that should be burned alive:
“I do. I do see green shoots. And not everywhere, but certainly in some of the markets that we've been functioning in. And we've seen some improvement in the banks, as well, certainly in some key cases.” // Ben Bernanke, Chairman Federal Reserve
If you know anything about economics or math you are probably seeing the hilariousness in this quote just as I do. Look at what he is really saying. In this madman’s own words it is the markets where the Federal Reserve has been functioning within that are showing certain “green shoots”. The GDP drop has been halted, sure, that much is true, but what have really happened? If we, oh, I don’t know, look at the Stock Market, just for the fun of it – then we see that the market increase on the US stock market have lately been about $2 trillion, which seems to be a lot, but out of this increase almost $1,6 trillion comes from “new bank reserves” used to buy mortgage-backed securities and treasuries, and who has conjured up this money? Yeah, that’s right, Bernanke has. It is fun when you have your own printing machine, isn’t it? I would also claim, although hard to really measure, that those $400 billion that is left comes mainly from positive reactions on the market since it is “growing”. In other words, the entire Stock Market increase is a fictive bubble!
And looking at banks, around 80 banks have gone down so far in this crisis. Is that what Barnanke calls “improvements”? No, he is probably referring to, among others, Goldman Sachs and JP Morgan. These banks, that was in a crisis just months ago is showing a fantastic improvements. Even if we ignore all those people (and I use that word very loosely) in the Obama administration that comes directly from or have strong ties to these particular banks, we are still faced with another nit little pile of crap. In a move that outmatches any cartoon villain wildest dreams they have used, through different channels, the bail-out money to inject their books with several billions and this is after they claim to be able to “pay the state back”. I hope you are laughing, I know I am.
Here is another idiot that should be fed to a pack of wild animals:
“The worst of the global crisis is over with economic and exports growth showing signs of stabilization.(…) There is still room for the U.S. government to increase spending to boost growth.”
// Paul Krugman, Economist
And this guy have actually won a Nobel Prize, can you imagine that?
I have written about GDP several times now, but what you only need to know is this: if consumer spending drops by $500 billion but the government spends an extra $600 billion, we can say (all else equal) that we have economic growth by $100 billion that increases GDP. Since this is the main cause of the “halting of the crisis”-bamboozle, where does this money come from? Two places, borrowing and printing. The US Government is borrowing hundreds of billions and printing even more money and this is what’s fuelling the economy. The idea that government, by stepping in and borrowing and printing trillions of dollars, and then spend the money and call it growth defies common sense.
Can you see the fun in this? I think it’s bloody priceless.
Maybe you think your country is better off, think again. The Swedish Government, that so far has done a so so job during this crisis is showing signs of going down the same socialist path which will destroy the last remaining buffert my birth nation has. Sweden’s total debt (gov+personal+companies) is today 170% of GDP, the same as US. Great Britain has 306%, Ireland 378% and the Nederland’s 363%. The only good news for us Europeans is that we still have some companies that actually produce values and that the European Central bank (along with most in-house banks on the continent) have not yet capitalised as much debt and printed as many trillions as the US of A have. The big exception here is Gordon Brownie and his criminal gang of thieves in the UK. It is almost as if Labour intentionally, wilfully, is destroying the entire country.
Do you think this is bad news? Maybe you might even mistrust some numbers our enemies are telling us? Better buckle up, it is even worse!
It is worse because of two things. Firstly, this is not the end. When the markets continues to crumble, unemployment is still souring high and/or one or two bubbles bursts, what will they do? They will do the same thing again! They will never admit defeat, never say they where wrong and never ever never ever ever start doing the right thing. In other words, there is no end to this crisis, it cannot be, and it doesn’t matter if the dips come now and again over the coming year(s) or if we get a long deep depression (which will happen sooner or later anyway) directly, the end result will be the same.
And if this doesn’t make you laugh hysterically, how about the next fun fact; the dollar, that most of the American debt and borrowing is based on, is the worlds reserve currency and the basis of many commodity prices like oil, gold and so on. So what will happen when the dollar is defaulting and, most likely, collapses? Maybe even at the same time as the inflated stock markets goes down? Yes, that’s right! Oh... I cannot wait for this.
I want you all to take notes. Write down the name on every one of these pranksters that is claiming to see “green shoots”. Firstly you can compare those names to the names of those that did not see this crisis coming – it’s the same persons. Secondly, save those names, preferably with photos. There will come a time, a sunny day in the future, when you, if still alive, will have a good strong oak in front of you, and with a hardy rope, tied in a nice little nouse, you can sacredly announce the accusations before kicking down that pile of crates.
Lets us look at what two of these funny clown administrators from Washington have said recently.
Here is the first one that should be burned alive:
“I do. I do see green shoots. And not everywhere, but certainly in some of the markets that we've been functioning in. And we've seen some improvement in the banks, as well, certainly in some key cases.” // Ben Bernanke, Chairman Federal Reserve
If you know anything about economics or math you are probably seeing the hilariousness in this quote just as I do. Look at what he is really saying. In this madman’s own words it is the markets where the Federal Reserve has been functioning within that are showing certain “green shoots”. The GDP drop has been halted, sure, that much is true, but what have really happened? If we, oh, I don’t know, look at the Stock Market, just for the fun of it – then we see that the market increase on the US stock market have lately been about $2 trillion, which seems to be a lot, but out of this increase almost $1,6 trillion comes from “new bank reserves” used to buy mortgage-backed securities and treasuries, and who has conjured up this money? Yeah, that’s right, Bernanke has. It is fun when you have your own printing machine, isn’t it? I would also claim, although hard to really measure, that those $400 billion that is left comes mainly from positive reactions on the market since it is “growing”. In other words, the entire Stock Market increase is a fictive bubble!
And looking at banks, around 80 banks have gone down so far in this crisis. Is that what Barnanke calls “improvements”? No, he is probably referring to, among others, Goldman Sachs and JP Morgan. These banks, that was in a crisis just months ago is showing a fantastic improvements. Even if we ignore all those people (and I use that word very loosely) in the Obama administration that comes directly from or have strong ties to these particular banks, we are still faced with another nit little pile of crap. In a move that outmatches any cartoon villain wildest dreams they have used, through different channels, the bail-out money to inject their books with several billions and this is after they claim to be able to “pay the state back”. I hope you are laughing, I know I am.
Here is another idiot that should be fed to a pack of wild animals:
“The worst of the global crisis is over with economic and exports growth showing signs of stabilization.(…) There is still room for the U.S. government to increase spending to boost growth.”
// Paul Krugman, Economist
And this guy have actually won a Nobel Prize, can you imagine that?
I have written about GDP several times now, but what you only need to know is this: if consumer spending drops by $500 billion but the government spends an extra $600 billion, we can say (all else equal) that we have economic growth by $100 billion that increases GDP. Since this is the main cause of the “halting of the crisis”-bamboozle, where does this money come from? Two places, borrowing and printing. The US Government is borrowing hundreds of billions and printing even more money and this is what’s fuelling the economy. The idea that government, by stepping in and borrowing and printing trillions of dollars, and then spend the money and call it growth defies common sense.
Can you see the fun in this? I think it’s bloody priceless.
Maybe you think your country is better off, think again. The Swedish Government, that so far has done a so so job during this crisis is showing signs of going down the same socialist path which will destroy the last remaining buffert my birth nation has. Sweden’s total debt (gov+personal+companies) is today 170% of GDP, the same as US. Great Britain has 306%, Ireland 378% and the Nederland’s 363%. The only good news for us Europeans is that we still have some companies that actually produce values and that the European Central bank (along with most in-house banks on the continent) have not yet capitalised as much debt and printed as many trillions as the US of A have. The big exception here is Gordon Brownie and his criminal gang of thieves in the UK. It is almost as if Labour intentionally, wilfully, is destroying the entire country.
Do you think this is bad news? Maybe you might even mistrust some numbers our enemies are telling us? Better buckle up, it is even worse!
It is worse because of two things. Firstly, this is not the end. When the markets continues to crumble, unemployment is still souring high and/or one or two bubbles bursts, what will they do? They will do the same thing again! They will never admit defeat, never say they where wrong and never ever never ever ever start doing the right thing. In other words, there is no end to this crisis, it cannot be, and it doesn’t matter if the dips come now and again over the coming year(s) or if we get a long deep depression (which will happen sooner or later anyway) directly, the end result will be the same.
And if this doesn’t make you laugh hysterically, how about the next fun fact; the dollar, that most of the American debt and borrowing is based on, is the worlds reserve currency and the basis of many commodity prices like oil, gold and so on. So what will happen when the dollar is defaulting and, most likely, collapses? Maybe even at the same time as the inflated stock markets goes down? Yes, that’s right! Oh... I cannot wait for this.
I want you all to take notes. Write down the name on every one of these pranksters that is claiming to see “green shoots”. Firstly you can compare those names to the names of those that did not see this crisis coming – it’s the same persons. Secondly, save those names, preferably with photos. There will come a time, a sunny day in the future, when you, if still alive, will have a good strong oak in front of you, and with a hardy rope, tied in a nice little nouse, you can sacredly announce the accusations before kicking down that pile of crates.
Sunday, August 9, 2009
And the sun rises in the East...
Apparently an unpublished report is telling us that 25% of Sweden’s local politicians are willing to support a local business even if it means breaking the law. According to the same “survey” about 33% of the same politicians believe they would say yes if a company treated them to a whole day of drinking and feasting.
I believe this little report is wrong and I would argue that the numbers are much higher than this.
Firstly, these kinds of “revelations” shouldn’t be a surprise to anyone. Just listen to a local debate about whether or not a new mall or supermarket should be allowed to establish and you realize that those 25% is a very low number. And of course they will give privileges to local companies wherein they might know the owner and/or several workers.
Secondly, these numbers are totally dependent on “what company” we are talking about. If the question is asked regarding Philip Morris for instance, hardly a single politician would comply (rather not dare to – think of the uproar in media). If it, however, is some “save the nature” company or an organisation that is out to save females from rapists, every one of our elected frauds would eat, drink and even take bribes without even blinking. It will also depend on size of the company – the more jobs, the better. There are so many factors to be counted into a study like this that it’s almost impossible to come to any conclusions. So even if I applaud media for revealing politicians for the deceitful bastards they are, I hardly regard this as news. The system is totally messed up and this is just one of many strange things that comes with it.
I believe this little report is wrong and I would argue that the numbers are much higher than this.
Firstly, these kinds of “revelations” shouldn’t be a surprise to anyone. Just listen to a local debate about whether or not a new mall or supermarket should be allowed to establish and you realize that those 25% is a very low number. And of course they will give privileges to local companies wherein they might know the owner and/or several workers.
Secondly, these numbers are totally dependent on “what company” we are talking about. If the question is asked regarding Philip Morris for instance, hardly a single politician would comply (rather not dare to – think of the uproar in media). If it, however, is some “save the nature” company or an organisation that is out to save females from rapists, every one of our elected frauds would eat, drink and even take bribes without even blinking. It will also depend on size of the company – the more jobs, the better. There are so many factors to be counted into a study like this that it’s almost impossible to come to any conclusions. So even if I applaud media for revealing politicians for the deceitful bastards they are, I hardly regard this as news. The system is totally messed up and this is just one of many strange things that comes with it.
Another clueless idiot
Read an article in one of Sweden’s biggest newspapers this morning and again we are being told that ”this is isn’t so bad” referring to the current economic crisis. Anders Bolling is the journalist trying to convince us. Bolling is one of those optimists, a group I myself belong to most of the time. Seen over time things have been getting better for the overwhelming majority of people on this planet and in several articles and in a published book Bolling have, for the most part, accurately described this reality. However, there are several aspects to this crisis he fails to take into account and those are the reason why I, in this case, do not believe in a happy outcome.
Even if Bolling do address our debt accumulation and he do mention that this is a problem; he does not mention - probably because he does not understand it - that this debt has soured to such levels that they have become a problem in themselves. Being in debt is not really the problem, but being in debt in relation to other things, however, is. Firstly it’s not only the state budget and deficits that needs to be counted, but also all the mortgages and credit card debts among the populace. And this is only one part of the problem. This debt also needs to be related to our ability to produce and, as consequens, the real wealth creation in society. I am not talking about GDP (BNP) as Bolling mentions in this article, no, what I mean is real production capacity and what we actually produce. In GDP we add services, governmental as well as private services, and services is not really the same as wealth. It can make our lives easier and as such create “value” in the form of additional time or better haircuts, but it is not really the same as wealth. In GDP we also add such things as snow shovelling or cleaning up after a Typhoon which is why the current weather hitting the shores of China will in fact increase GDP because the cost is actually a plus when it comes to GDP-bookkeeping. And do you know what’s not calculated into GDP? Debt. As long as we borrow and spend more than we pay back on loans it will only increase what Bolling and cornflake economist’s regards as “wealth creation”.
What also need to be addressed is where some of the “recuperation” comes from. Partly in relation to what has been mentioned and partly in regards to the massive amounts of newly printed money being thrown into the system we can see some “green shoots” in several economies, also the Swedish one. Not that it has stopped the down going spiral; it has only halted it somewhat. Unemployment is till rising, several important businesses is still in red ink and things are only going “thanks to” artificially low interest rates, but it’s not as bad as it was - hurray…
Another thing that needs to be taking into account that’s not mentioned in Bollings article is Sweden’s almost total dependents of trade. And two of Sweden’s main trading partners are UK and the US – two countries in the deepest of all shit piles. One can argue, and rightfully so, that if trade does not go up and if the recession (in reality already a depression) keeps going there will not be a recovery for Sweden. To this we also need to add the coming collapse of the USD and the consequences this will have on commodity prices and the world markets and how this will have serious impacts on the Swedish economy.
The main concern we should have is - together with all mentioned - the bubbles that have been inflated in the economy. Housing prices are still very high and have several months during this year even been going up, when they in reality should be going down. Also, all those borrowed and newly printed money that has been given to banks have mainly been put to use on the stock market which means that many stock prices are at a higher level than they ought to be.
All in all, Sweden is in deep trouble. Not as bad as many other countries because the center-right government haven’t been going on the same spending spree as most counterparts and my fellow countrymen still produce things, but it is bad enough. Only looking at my birth nation it would be okay. The bubbles are bad, the debt accumulation is bad, the real wealth creating is to low, but with only eyes on Sweden, it might not be so horrid and it is possible that this slump wouldn’t last much longer. But factor in the trade dependency, the coming crashes that will occur in other countries, the collapse of the USD and the paved road towards socialism and we have a catastrophe on our hands. I do believe that Sweden, in the long run, might be better off then many other countries, but that notion is dependent on my countrymen not moving the country further towards socialism.
Even if Bolling do address our debt accumulation and he do mention that this is a problem; he does not mention - probably because he does not understand it - that this debt has soured to such levels that they have become a problem in themselves. Being in debt is not really the problem, but being in debt in relation to other things, however, is. Firstly it’s not only the state budget and deficits that needs to be counted, but also all the mortgages and credit card debts among the populace. And this is only one part of the problem. This debt also needs to be related to our ability to produce and, as consequens, the real wealth creation in society. I am not talking about GDP (BNP) as Bolling mentions in this article, no, what I mean is real production capacity and what we actually produce. In GDP we add services, governmental as well as private services, and services is not really the same as wealth. It can make our lives easier and as such create “value” in the form of additional time or better haircuts, but it is not really the same as wealth. In GDP we also add such things as snow shovelling or cleaning up after a Typhoon which is why the current weather hitting the shores of China will in fact increase GDP because the cost is actually a plus when it comes to GDP-bookkeeping. And do you know what’s not calculated into GDP? Debt. As long as we borrow and spend more than we pay back on loans it will only increase what Bolling and cornflake economist’s regards as “wealth creation”.
What also need to be addressed is where some of the “recuperation” comes from. Partly in relation to what has been mentioned and partly in regards to the massive amounts of newly printed money being thrown into the system we can see some “green shoots” in several economies, also the Swedish one. Not that it has stopped the down going spiral; it has only halted it somewhat. Unemployment is till rising, several important businesses is still in red ink and things are only going “thanks to” artificially low interest rates, but it’s not as bad as it was - hurray…
Another thing that needs to be taking into account that’s not mentioned in Bollings article is Sweden’s almost total dependents of trade. And two of Sweden’s main trading partners are UK and the US – two countries in the deepest of all shit piles. One can argue, and rightfully so, that if trade does not go up and if the recession (in reality already a depression) keeps going there will not be a recovery for Sweden. To this we also need to add the coming collapse of the USD and the consequences this will have on commodity prices and the world markets and how this will have serious impacts on the Swedish economy.
The main concern we should have is - together with all mentioned - the bubbles that have been inflated in the economy. Housing prices are still very high and have several months during this year even been going up, when they in reality should be going down. Also, all those borrowed and newly printed money that has been given to banks have mainly been put to use on the stock market which means that many stock prices are at a higher level than they ought to be.
All in all, Sweden is in deep trouble. Not as bad as many other countries because the center-right government haven’t been going on the same spending spree as most counterparts and my fellow countrymen still produce things, but it is bad enough. Only looking at my birth nation it would be okay. The bubbles are bad, the debt accumulation is bad, the real wealth creating is to low, but with only eyes on Sweden, it might not be so horrid and it is possible that this slump wouldn’t last much longer. But factor in the trade dependency, the coming crashes that will occur in other countries, the collapse of the USD and the paved road towards socialism and we have a catastrophe on our hands. I do believe that Sweden, in the long run, might be better off then many other countries, but that notion is dependent on my countrymen not moving the country further towards socialism.
banker-controlled mafia
If there is one little flick you should see it is probably this one. In these minutes it explains pretty much everything you need you know about banking and money. Although about the US it can be applicable to all nations. You think you mistrust the financial system and despise your bank? Take a look at this and you will feel utter hatred.
Fantastic for china
Typhoon Morakot has made the Chinese government to move some 473,000 residents of Zhejiang province, as well as 480,000 from Fujian getting evacuated. In Fuzhou, people have been rushing to supermarkets to stock up on provisions ahead of the typhoon's arrival.
Morakot dumped 250cm of rain on Taiwan as it crossed the island before heading for China, leaving some of the worst flooding to hit some of the southern counties in half a century. The Typhoon has also contributed to heavy rains in the Philippines, where at least 10 people were killed in flooding and landslides.
All of this is, of course, fantastic news for the entire region. Everyone should rejoice because every injured person, every destroyed crop and every smashed boat will help the poor get richer, at least according to every cornflake economist in this world. Not only are people stockpiling goods and in need of relocation, all of which costs money and resources, also building will get destroyed, cars will tip over, and windows will brake and so on. And the consequence of this is higher GDP! China has got a free stimulus package from nature! Although Typhoons or nature in general cannot bail out failing companies or print phantom money, what we are seeing is still an enormous plus in the Chinese bookkeeping since we all know that GDP is the best thing there is to measure wealth with…
The only thing I’m waiting for now is some pseudo scientist mumbling something about man-made global warming and a couple of brain-dead journalists saying we need to drive fewer cars.
Morakot dumped 250cm of rain on Taiwan as it crossed the island before heading for China, leaving some of the worst flooding to hit some of the southern counties in half a century. The Typhoon has also contributed to heavy rains in the Philippines, where at least 10 people were killed in flooding and landslides.
All of this is, of course, fantastic news for the entire region. Everyone should rejoice because every injured person, every destroyed crop and every smashed boat will help the poor get richer, at least according to every cornflake economist in this world. Not only are people stockpiling goods and in need of relocation, all of which costs money and resources, also building will get destroyed, cars will tip over, and windows will brake and so on. And the consequence of this is higher GDP! China has got a free stimulus package from nature! Although Typhoons or nature in general cannot bail out failing companies or print phantom money, what we are seeing is still an enormous plus in the Chinese bookkeeping since we all know that GDP is the best thing there is to measure wealth with…
The only thing I’m waiting for now is some pseudo scientist mumbling something about man-made global warming and a couple of brain-dead journalists saying we need to drive fewer cars.
Any heroes left in the world?
The American congress has grown a tad fearful of the citizens. Rather than facing their constituents back home during the summer recess, many Congressmen and Senators have canceled town hall meetings and decided instead to remain hidden. And many of those that have dared faced the voters have been booed of the staged or been ridiculed as they tried to stay. And this is not only for democrats, no, also republicans have been facing a lot of anger and outrage. Together with the recent tea parties, forming of bigger and new militia groups and other similar things this brings a tiny cloud of hope glimmering on the other side of the Atlantic. So far the outrage is a non-violent one. But how long with that last? I hope it will be just a matter of days before the first congressman or the first governor gets literary thrown out on his/her ass. I hope that the next mass shooting from some disgruntle postal worker or angry man that lost his job will be inside the capital building or at an Obamination rally. I'm amazed we haven't seen US citizens out in the streets with pitchforks and torches long ago because in contrast to us Europeans, the Americans have something they can point at, something to support their rebellion in; the constitution. And remember, the American Revolution 1775 to 1783 started as taxation and freedom from the state kind of a thing and that memory is still kept alive in the hearts of most US citizens.
I still have a slim hope that the US of A can withhold the legacy of their founding fathers and throw out all the fascists and socialists that rule Washington. All of them, not just democrats or the Obamination - they are just the latest in a long line of traitors. The entire system must be overturned and the constitution needs to come back as the guiding star. That is the only hope I can see in the world today because no other country have that ground, that foundation and that history.
The worst thing the resent decades have done to us is made us complacent. We have lived to good lives - living on what former generations produced - so we do not react when civil and political freedoms are diminished. We can still sit comfortable in our chairs without fearing famine while watching journalists trying to indoctrinate us. And this is the problem. Please believe me, sooner or later you will not be able to walk over to that fridge and pick out a cold beer anymore, because either you won’t own a home or you will not have the income to get food and beverages on the table.
It is time to rebel. It does not need to be a violent one, at least not yet. What we need to do is to refuse to pay taxes, refuse to obey stupid internet laws and refuse to submit to all that crap the enemy class throws at us. We need more people willing to go to jail, get beaten up by police and ridiculed by the left wing media. We need heroes. So the real question is; are there any heroes left in the world?
I still have a slim hope that the US of A can withhold the legacy of their founding fathers and throw out all the fascists and socialists that rule Washington. All of them, not just democrats or the Obamination - they are just the latest in a long line of traitors. The entire system must be overturned and the constitution needs to come back as the guiding star. That is the only hope I can see in the world today because no other country have that ground, that foundation and that history.
The worst thing the resent decades have done to us is made us complacent. We have lived to good lives - living on what former generations produced - so we do not react when civil and political freedoms are diminished. We can still sit comfortable in our chairs without fearing famine while watching journalists trying to indoctrinate us. And this is the problem. Please believe me, sooner or later you will not be able to walk over to that fridge and pick out a cold beer anymore, because either you won’t own a home or you will not have the income to get food and beverages on the table.
It is time to rebel. It does not need to be a violent one, at least not yet. What we need to do is to refuse to pay taxes, refuse to obey stupid internet laws and refuse to submit to all that crap the enemy class throws at us. We need more people willing to go to jail, get beaten up by police and ridiculed by the left wing media. We need heroes. So the real question is; are there any heroes left in the world?
Saturday, August 8, 2009
Let ’em be!
A big reggae festival in Sweden has been hit by police again, snatching up around 240 people on drug charges. The media reports this and interesting enough they also report no disturbances and no violence to speak of. So around 10 000 people gather at a venue, presumably doing drugs (seemingly only cannabis) and there is no violence. Compare that to any town of equivalent size a Saturday night with people drinking alcohol…
In any case, people doing drugs should, of course, be left alone. Do we own our own bodies? Can I decide what I smoke, drink or eat? Am I the sole king over me? The answers to these questions are NO – the government owns us. That’s the conclusion we can draw and instead of having the police chasing real criminals like murderers, rapists, bankers and robbers, law enforcement is wasting time with people exercising their human rights. These people are, apparently, good citizens and if the crime rate is this low, let them smoke, dance, eat or inject whatever, their life, their bodies and their choice. The government should stay out of our lives because as long as they keep interfering we will keep having recessions and people will keep being locked up for doing nothing wrong.
And just so you all know, I detest cannabis which I never understood the fun thing with. I’m a Swedish male and consequently I drink vodka, preferably home-brewed and that’s another thing that should be legalized.
In any case, people doing drugs should, of course, be left alone. Do we own our own bodies? Can I decide what I smoke, drink or eat? Am I the sole king over me? The answers to these questions are NO – the government owns us. That’s the conclusion we can draw and instead of having the police chasing real criminals like murderers, rapists, bankers and robbers, law enforcement is wasting time with people exercising their human rights. These people are, apparently, good citizens and if the crime rate is this low, let them smoke, dance, eat or inject whatever, their life, their bodies and their choice. The government should stay out of our lives because as long as they keep interfering we will keep having recessions and people will keep being locked up for doing nothing wrong.
And just so you all know, I detest cannabis which I never understood the fun thing with. I’m a Swedish male and consequently I drink vodka, preferably home-brewed and that’s another thing that should be legalized.
And another sign...
WASHINGTON (Reuters) – U.S. Treasury Secretary Timothy Geithner formally requested that Congress raise the $12.1 trillion statutory debt limit on Friday, saying that it could be breached as early as mid-October.
news.yahoo
Let's say it all together now: Heil Depression! Heil!
news.yahoo
Let's say it all together now: Heil Depression! Heil!
Get used to it... the worst is yet to come...
finance.yahoo
* By Steve Hargreaves, CNNMoney.com staff writer
* On Friday August 7, 2009, 12:38 pm EDT
From the article:
In this recession-racked town, the lack of food is a serious problem. It's a theme that comes up again and again in conversations in Detroit.
What makes this recession different is the type of people coming in. It's no longer just the homeless, or the really poor. Now it's middle class folks who lost their $60,000-a-year auto job, or home owners who got caught on the wrong side of the real estate bubble.
finance.yahoo
* By Steve Hargreaves, CNNMoney.com staff writer
* On Friday August 7, 2009, 12:38 pm EDT
From the article:
In this recession-racked town, the lack of food is a serious problem. It's a theme that comes up again and again in conversations in Detroit.
What makes this recession different is the type of people coming in. It's no longer just the homeless, or the really poor. Now it's middle class folks who lost their $60,000-a-year auto job, or home owners who got caught on the wrong side of the real estate bubble.
finance.yahoo
Hyperinflation coming soon
Things are going so horrible bad in the US that it boggles even my mind. There are many of us that have been trying to warn people about this and that. Lately one of the main warnings being issued is the coming collapse of the USD. If there were any doubts about that looming disaster, you should take a look at this picture:
“That makes today your average, regular $26.2 billion dollar day of thin-air money injection ($7 + $ 19.2). To put this in context, today's fresh money operation, alone, would have been 88th on the list of yearly total output on the world GDP listing.”
And you know this money goes somewhere, and where are we seeing those “green shoots” again? That’s right…
Oh, we are being so royally fucked.
“That makes today your average, regular $26.2 billion dollar day of thin-air money injection ($7 + $ 19.2). To put this in context, today's fresh money operation, alone, would have been 88th on the list of yearly total output on the world GDP listing.”
And you know this money goes somewhere, and where are we seeing those “green shoots” again? That’s right…
Oh, we are being so royally fucked.
I (we) need….
There is lots of stuff I need to replace. For instance this lap top I’m writing on is over 1 year old, wouldn’t it be great if the government could print and/or borrow some more money (or steal from us) and subsidize computer companies with a couple of thousands so I, and everyone else, could buy a new one? We can call this “The PC replacement program”. Would save jobs in the computer industry, I can give my computer to some poor fellow in Africa and everyone wins…
I also need new clothes. I could tear up and cut my clothes into little pieces and then the Government can print and/or borrow some more money (or steal from us) and hand me a voucher so I can buy new ones. Great stuff really. It would save thousands of jobs in the textile industry.
I also need a house. Although this might be a tad too expensive for the government to buy for everyone, so let’s just have them lower interest rates, instate a government bank that is easier to borrow from so we can borrow some money and if the government does the same and subsidize, oh, let’s say, 20% we can all buy or replace our homes! This would be great for the real-estate market and would increase GDP! Wow, I’m on to something here.
How about a new MP3 player? Doesn’t owning a good music player constitute as a human right? Why isn’t the government handing out those for free?
Shoes are very important and didn’t a couple of companies show bad results lately? Come on! Let’s help all those and let’s save jobs!
And that entertainment industry we are conjuring up laws for, they need more help. They are not earning nearly enough money, let’s give ‘em some!
The government is clearly not taking a good enough interest in mine or your wellbeing. They are not borrowing enough, printing enough and subsidizing enough. And most importantly, if doing so they would increase companies’ profits and GDP!! That’s what we are all rooting and hoping for, so let’s get cracking.
I also need new clothes. I could tear up and cut my clothes into little pieces and then the Government can print and/or borrow some more money (or steal from us) and hand me a voucher so I can buy new ones. Great stuff really. It would save thousands of jobs in the textile industry.
I also need a house. Although this might be a tad too expensive for the government to buy for everyone, so let’s just have them lower interest rates, instate a government bank that is easier to borrow from so we can borrow some money and if the government does the same and subsidize, oh, let’s say, 20% we can all buy or replace our homes! This would be great for the real-estate market and would increase GDP! Wow, I’m on to something here.
How about a new MP3 player? Doesn’t owning a good music player constitute as a human right? Why isn’t the government handing out those for free?
Shoes are very important and didn’t a couple of companies show bad results lately? Come on! Let’s help all those and let’s save jobs!
And that entertainment industry we are conjuring up laws for, they need more help. They are not earning nearly enough money, let’s give ‘em some!
The government is clearly not taking a good enough interest in mine or your wellbeing. They are not borrowing enough, printing enough and subsidizing enough. And most importantly, if doing so they would increase companies’ profits and GDP!! That’s what we are all rooting and hoping for, so let’s get cracking.
what you need to know
While a mock trial goes on in Iran, we have a people suffering for another reason in Honduras. Iran, getting criticism, but not nearly enough. Honduras, however, where the democratic government has done the right thing; is getting lots of heat in media. Why?
The dictator wannabe Zelaya has now apparently been thrown out of Mexico as well, something I so far haven't seen reported in our western media. Why?
Here is what you need to know:
What you'll learn is that the Honduran Constitution may be amended in any way except three. No amendment can ever change (1) the country's borders, (2) the rules that limit a president to a single four-year term and (3) the requirement that presidential administrations must "succeed one another" in a "republican form of government."
In addition, Article 239 specifically states that any president who so much as proposes the permissibility of reelection "shall cease forthwith" in his duties, and Article 4 provides that any "infraction" of the succession rules constitutes treason. The rules are so tight because these are terribly serious issues for Honduras, which lived under decades of military rule.
Our media is never doing their job, I have said that before and I say it again. It is very frustrating how media has ignored the hundreds of thousands that gathered to support the Honduran government and oppose (CNN even called a 20,000 big rally pro-Zelaya when it was a pro-government rally). The biggest protest by the Zelaya supporters has been around 45,000. While a week before the socialist dictator was thrown out 100,000 marched against Zelaya's illegalities in San Pedro Sula. 160,000 gathered at the presidential palace and 40,000 gathered at the Central Park of Tegucigalpa in support of the current government and against Zelaya and Chavez's intervention.
And What is the main source our bias media is using for their reports from Honduras? It's TELESUR. And do you know who owns that channel? Hugo Chavez...
Of course the Obamination is showing his true color, hardly saying anything towards Iran, but condeming the democratic government of Honduras as mentioned here:
FACT:
The only illegal action that was taken was expelling Zelaya from Honduras. The military has admitted that and said they are expecting citations for what they did. The judicial advisor of the army said he was ready to take responsibility of his actions. He said that the military seriously considered the risks and consequences of each option they had. After considering the option of arresting, encarcerating, and submitting Zelaya to trial in a base or prison in Honduras, they decided it was too dangerous for the people, the military, and Zelaya. Considering the infiltration of foreign agitators and the fact that Zelaya previously led and emboldened a mob to break into the air force base, they concluded the possibilities of a massacre was too high to keep him in the country.
The dictator wannabe Zelaya has now apparently been thrown out of Mexico as well, something I so far haven't seen reported in our western media. Why?
Here is what you need to know:
What you'll learn is that the Honduran Constitution may be amended in any way except three. No amendment can ever change (1) the country's borders, (2) the rules that limit a president to a single four-year term and (3) the requirement that presidential administrations must "succeed one another" in a "republican form of government."
In addition, Article 239 specifically states that any president who so much as proposes the permissibility of reelection "shall cease forthwith" in his duties, and Article 4 provides that any "infraction" of the succession rules constitutes treason. The rules are so tight because these are terribly serious issues for Honduras, which lived under decades of military rule.
Our media is never doing their job, I have said that before and I say it again. It is very frustrating how media has ignored the hundreds of thousands that gathered to support the Honduran government and oppose (CNN even called a 20,000 big rally pro-Zelaya when it was a pro-government rally). The biggest protest by the Zelaya supporters has been around 45,000. While a week before the socialist dictator was thrown out 100,000 marched against Zelaya's illegalities in San Pedro Sula. 160,000 gathered at the presidential palace and 40,000 gathered at the Central Park of Tegucigalpa in support of the current government and against Zelaya and Chavez's intervention.
And What is the main source our bias media is using for their reports from Honduras? It's TELESUR. And do you know who owns that channel? Hugo Chavez...
Of course the Obamination is showing his true color, hardly saying anything towards Iran, but condeming the democratic government of Honduras as mentioned here:
FACT:
The only illegal action that was taken was expelling Zelaya from Honduras. The military has admitted that and said they are expecting citations for what they did. The judicial advisor of the army said he was ready to take responsibility of his actions. He said that the military seriously considered the risks and consequences of each option they had. After considering the option of arresting, encarcerating, and submitting Zelaya to trial in a base or prison in Honduras, they decided it was too dangerous for the people, the military, and Zelaya. Considering the infiltration of foreign agitators and the fact that Zelaya previously led and emboldened a mob to break into the air force base, they concluded the possibilities of a massacre was too high to keep him in the country.
Friday, August 7, 2009
Adults need a spanking
After the New Zeeland’s referendum regarding child discipline a similar debate has emerge in my home country Sweden. Although very few advocating reinstatement of child disciplinary of the physical kind, the debate is at least on the table. In New Zeeland the discussion is about balancing child protection and family subsidiarity – the ability of families to make decisions for themselves without undue government interference. In Sweden it is more of psychological character i.e. how it affect the child’s mental status – in other words, are we going to abuse our kids into psychopathic behavior or not. A huge difference on the basic debating issue. And this is about penalties towards kids, aren’t there bigger fishes to fry?
Me, I’m thinking it should be the other way around. Stealing your neighbors toys, smashing a window or not eating your food might be a penal offence, but what about willfully selling out our future? How about voting for, rooting for and demonstrating for fascism? How about not standing up and protecting the young against internet restrictions? Adults might think they love their kids, but do they really?
Parents all over the globe have been, are right now, and most likely will continue to support a policy that is leading us towards utter destruction. Our collective debts are souring, mortgaging our future. Our laws are expanding, making us into slaves to the government. The ones that really deserve a proper spanking are the generation(s) that has destroyed children’s future. All of you out there that vote for, support and sponsor the expanding socialization and bankruptcy of our countries, you are criminals and the true child abusers. Parents everywhere are idiots and will, quite possibly, bring forth the very destruction of their young.
This little tune cannot be played enough:
Me, I’m thinking it should be the other way around. Stealing your neighbors toys, smashing a window or not eating your food might be a penal offence, but what about willfully selling out our future? How about voting for, rooting for and demonstrating for fascism? How about not standing up and protecting the young against internet restrictions? Adults might think they love their kids, but do they really?
Parents all over the globe have been, are right now, and most likely will continue to support a policy that is leading us towards utter destruction. Our collective debts are souring, mortgaging our future. Our laws are expanding, making us into slaves to the government. The ones that really deserve a proper spanking are the generation(s) that has destroyed children’s future. All of you out there that vote for, support and sponsor the expanding socialization and bankruptcy of our countries, you are criminals and the true child abusers. Parents everywhere are idiots and will, quite possibly, bring forth the very destruction of their young.
This little tune cannot be played enough:
Obamination posters
What started with a posters turning up all over Los Angeles has now gone into overdrive and now people are finding these everywhere.
Me, I find this kind of offensive. They have taken a white man with a dubious sociopathic character with criminal behavior and turn him into something much much worse. That poor Joker fellow does not deserve being depicted in this manner. The Joker cannot hold a candle to one of the worst criminals in human history. Can the Obaminations psychotic behavior be stopped? Maybe with some more research, but it would be better with some led treatment.
However, it is fun to see the American people - some of them at least - waking up and refusing to submit. The Obamination is now the least favored president this far into his presidency compared to all other presidents before. No wonder he is building his own private army and has FEMA building camps all over the US. Something really bad is going to happen in US of A and I cannot wait for the funny mayhem and bloodshed to start.
Me, I find this kind of offensive. They have taken a white man with a dubious sociopathic character with criminal behavior and turn him into something much much worse. That poor Joker fellow does not deserve being depicted in this manner. The Joker cannot hold a candle to one of the worst criminals in human history. Can the Obaminations psychotic behavior be stopped? Maybe with some more research, but it would be better with some led treatment.
However, it is fun to see the American people - some of them at least - waking up and refusing to submit. The Obamination is now the least favored president this far into his presidency compared to all other presidents before. No wonder he is building his own private army and has FEMA building camps all over the US. Something really bad is going to happen in US of A and I cannot wait for the funny mayhem and bloodshed to start.
Everyone; raise your hands in the air and say; oh Yeah!
Andrew Gavin Marshall
Global Research
Friday, August 7, 2009
Introduction
While there is much talk of a recovery on the horizon, commentators are forgetting some crucial aspects of the financial crisis. The crisis is not simply composed of one bubble, the housing real estate bubble, which has already burst. The crisis has many bubbles, all of which dwarf the housing bubble burst of 2008. Indicators show that the next possible burst is the commercial real estate bubble. However, the main event on the horizon is the “bailout bubble” and the general world debt bubble, which will plunge the world into a Great Depression the likes of which have never before been seen.
Housing Crash Still Not Over
The housing real estate market, despite numbers indicating an upward trend, is still in trouble, as, “Houses are taking months to sell. Many buyers are having trouble getting financing as lenders and appraisers struggle to figure out what houses are really worth in the wake of the collapse.” Further, “the overall market remains very soft [...] aside from speculators and first-time buyers.” Dean Baker, co-director of the Center for Economic and Policy Research in Washington said, “It would be wrong to imagine that we have hit a turning point in the market,” as “There is still an enormous oversupply of housing, which means that the direction of house prices will almost certainly continue to be downward.” Foreclosures are still rising in many states “such as Nevada, Georgia and Utah, and economists say rising unemployment may push foreclosures higher into next year.” Clearly, the housing crisis is still not at an end.[1]
The Commercial Real Estate Bubble
In May, Bloomberg quoted Deutsche Bank CEO Josef Ackermann as saying, “It’s either the beginning of the end or the end of the beginning.” Bloomberg further pointed out that, “A piece of the puzzle that must be calculated into any determination of the depth of our economic doldrums is the condition of commercial real estate — the shopping malls, hotels, and office buildings that tend to go along with real- estate expansions.” Residential investment went down 28.9 % from 2006 to 2007, and at the same time, nonresidential investment grew 24.9%, thus, commercial real estate was “serving as a buffer against the declining housing market.”
Commercial real estate lags behind housing trends, and so too, will the crisis, as “commercial construction projects are losing their appeal.” Further, “there are lots of reasons to suspect that commercial real estate was subject to some of the loose lending practices that afflicted the residential market. The Office of the Comptroller of the Currency’s Survey of Credit Underwriting Practices found that whereas in 2003 just 2 percent of banks were easing their underwriting standards on commercial construction loans, by 2006 almost a third of them were relaxing.” In May it was reported that, “Almost 80 percent of domestic banks are tightening their lending standards for commercial real-estate loans,” and that, “we may face double-bubble trouble for real estate and the economy.”[2]
In late July of 2009, it was reported that, “Commercial real estate’s decline is a significant issue facing the economy because it may result in more losses for the financial industry than residential real estate. This category includes apartment buildings, hotels, office towers, and shopping malls.” Worth noting is that, “As the economy has struggled, developers and landlords have had to rely on a helping hand from the US Federal Reserve in order to try to get credit flowing so that they can refinance existing buildings or even to complete partially constructed projects.” So again, the Fed is delaying the inevitable by providing more liquidity to an already inflated bubble. As the Financial Post pointed out, “From Vancouver to Manhattan, we are seeing rising office vacancies and declines in office rents.”[3]
In April of 2009, it was reported that, “Office vacancies in U.S. downtowns increased to 12.5 percent in the first quarter, the highest in three years, as companies cut jobs and new buildings came onto the market,” and, “Downtown office vacancies nationwide could come close to 15 percent by the end of this year, approaching the 10-year high of 15.5 percent in 2003.”[4]
In the same month it was reported that, “Strip malls, neighborhood centers and regional malls are losing stores at the fastest pace in at least a decade, as a spending slump forces retailers to trim down to stay afloat.” In the first quarter of 2009, retail tenants “have vacated 8.7 million square feet of commercial space,” which “exceeds the 8.6 million square feet of retail space that was vacated in all of 2008.” Further, as CNN reported, “vacancy rates at malls rose 9.5% in the first quarter, outpacing the 8.9% vacancy rate registered in all of 2008.” Of significance for those that think and claim the crisis will be over by 2010, “mall vacancies [are expected] to exceed historical levels through 2011,” as for retailers, “it’s only going to get worse.”[5] Two days after the previous report, “General Growth Properties Inc, the second-largest U.S. mall owner, declared bankruptcy on [April 16] in the biggest real estate failure in U.S. history.”[6]
In April, the Financial Times reported that, “Property prices in China are likely to halve over the next two years, a top government researcher has predicted in a powerful signal that the country’s economic downturn faces further challenges despite recent positive data.” This is of enormous significance, as “The property market, along with exports, were leading drivers of the booming Chinese economy over the past decade.” Further, “an apparent rebound in the property market was unsustainable over the medium term and being driven by a flood of liquidity and fraudulent activity rather than real demand.” A researcher at a leading Chinese government think tank reported that, “he expected average urban residential property prices to fall by 40 to 50 per cent over the next two years from their levels at the end of 2008.”[7]
In April, it was reported that, “The Federal Reserve is considering offering longer loans to investors in commercial mortgage-backed securities as part of a plan to help jump-start the market for commercial real estate debt.” Since February the Fed “has been analyzing appropriate terms and conditions for accepting commercial mortgage-backed securities (CMBS) and other mortgage assets as collateral for its Term Asset-Backed Securities Lending Facility (TALF).”[8]
In late July, the Financial Times reported that, “Two of America’s biggest banks, Morgan Stanley and Wells Fargo …threw into sharp relief the mounting woes of the US commercial property market when they reported large losses and surging bad loan,” as “The disappointing second-quarter results for two of the largest lenders and investors in office, retail and industrial property across the US confirmed investors’ fears that commercial real estate would be the next front in the financial crisis after the collapse of the housing market.” The commercial property market, worth $6.7 trillion, “which accounts for more than 10 per cent of US gross domestic product, could be a significant hurdle on the road to recovery.”[9]
The Bailout Bubble
While the bailout, or the “stimulus package” as it is often referred to, is getting good coverage in terms of being portrayed as having revived the economy and is leading the way to the light at the end of the tunnel, key factors are again misrepresented in this situation.
At the end of March of 2009, Bloomberg reported that, “The U.S. government and the Federal Reserve have spent, lent or committed $12.8 trillion, an amount that approaches the value of everything produced in the country last year.” This amount “works out to $42,105 for every man, woman and child in the U.S. and 14 times the $899.8 billion of currency in circulation. The nation’s gross domestic product was $14.2 trillion in 2008.”[10]
Gerald Celente, the head of the Trends Research Institute, the major trend-forecasting agency in the world, wrote in May of 2009 of the “bailout bubble.” Celente’s forecasts are not to be taken lightly, as he accurately predicted the 1987 stock market crash, the fall of the Soviet Union, the 1998 Russian economic collapse, the 1997 East Asian economic crisis, the 2000 Dot-Com bubble burst, the 2001 recession, the start of a recession in 2007 and the housing market collapse of 2008, among other things.
On May 13, 2009, Celente released a Trend Alert, reporting that, “The biggest financial bubble in history is being inflated in plain sight,” and that, “This is the Mother of All Bubbles, and when it explodes [...] it will signal the end to the boom/bust cycle that has characterized economic activity throughout the developed world.” Further, “This is much bigger than the Dot-com and Real Estate bubbles which hit speculators, investors and financiers the hardest. However destructive the effects of these busts on employment, savings and productivity, the Free Market Capitalist framework was left intact. But when the ‘Bailout Bubble’ explodes, the system goes with it.”
Celente further explained that, “Phantom dollars, printed out of thin air, backed by nothing… and producing next to nothing… defines the ‘Bailout Bubble.’ Just as with the other bubbles, so too will this one burst. But unlike Dot-com and Real Estate, when the “Bailout Bubble” pops, neither the President nor the Federal Reserve will have the fiscal fixes or monetary policies available to inflate another.” Celente elaborated, “Given the pattern of governments to parlay egregious failures into mega-failures, the classic trend they follow, when all else fails, is to take their nation to war,” and that, “While we cannot pinpoint precisely when the ‘Bailout Bubble’ will burst, we are certain it will. When it does, it should be understood that a major war could follow.”[11]
However, this “bailout bubble” that Celente was referring to at the time was the $12.8 trillion reported by Bloomberg. As of July, estimates put this bubble at nearly double the previous estimate.
As the Financial Times reported in late July of 2009, while the Fed and Treasury hail the efforts and impact of the bailouts, “Neil Barofsky, special inspector-general for the troubled asset relief programme, [TARP] said that the various US schemes to shore up banks and restart lending exposed federal agencies to a risk of $23,700bn [$23.7 trillion] – a vast estimate that was immediately dismissed by the Treasury.” The inspector-general of the TARP program stated that there were “fundamental vulnerabilities...relating to conflicts of interest and collusion, transparency, performance measures, and anti-money laundering.”
Barofsky also reports on the “considerable stress” in commercial real estate, as “The Fed has begun to open up Talf to commercial mortgage-backed securities to try to influence credit conditions in the commercial real estate market. The report draws attention to a new potential credit crunch when $500bn worth of real estate mortgages need to be refinanced by the end of the year.” Ben Bernanke, the Chairman of the Fed, and Timothy Geithner, the Treasury Secretary and former President of the New York Fed, are seriously discussing extending TALF (Term Asset-Backed Securities Lending Facility) into “CMBS [Commercial Mortgage-Backed Securities] and other assets such as small business loans and whether to increase the size of the programme.” It is the “expansion of the various programmes into new and riskier asset classes is one of the main bones of contention between the Treasury and Mr Barofsky.”[12]
Testifying before Congress, Barofsky said, “From programs involving large capital infusions into hundreds of banks and other financial institutions, to a mortgage modification program designed to modify millions of mortgages, to public-private partnerships using tens of billions of taxpayer dollars to purchase ‘toxic’ assets from banks, TARP has evolved into a program of unprecedented scope, scale, and complexity.” He explained that, “The total potential federal government support could reach up to 23.7 trillion dollars.”[13]
Is a Future Bailout Possible?
In early July of 2009, billionaire investor Warren Buffet said that, “unemployment could hit 11 percent and a second stimulus package might be needed as the economy struggles to recover from recession,” and he further stated that, “we’re not in a recovery.”[14] Also in early July, an economic adviser to President Obama stated that, “The United States should be planning for a possible second round of fiscal stimulus to further prop up the economy.”[15]
In August of 2009, it was reported that, “THE Obama administration will consider dishing out more money to rein in unemployment despite signs the recession is ending,” and that, “Treasury secretary Tim Geithner also conceded tax hikes could be on the agenda as the government worked to bring its huge recovery-related deficits under control.” Geithner said, “we will do what it takes,” and that, “more federal cash could be tipped into the recovery as unemployment benefits amid projections the benefits extended to 1.5 million jobless Americans will expire without Congress’ intervention.” However, any future injection of money could be viewed as “a second stimulus package.”[16]
The Washington Post reported in early July of a Treasury Department initiative known as “Plan C.” The Plan C team was assembled “to examine what could yet bring [the economy] down and has identified several trouble spots that could threaten the still-fragile lending industry,” and “the internal project is focused on vexing problems such as the distressed commercial real estate markets, the high rate of delinquencies among homeowners, and the struggles of community and regional banks.”
Further, “The team is also responsible for considering potential government responses, but top officials within the Obama administration are wary of rolling out initiatives that would commit massive amounts of federal resources.” The article elaborated in saying that, “The creation of Plan C is a sign that the government has moved into a new phase of its response, acting preemptively rather than reacting to emerging crises.” In particular, the near-term challenge they are facing is commercial real estate lending, as “Banks and other firms that provided such loans in the past have sharply curtailed lending,” leaving “many developers and construction companies out in the cold.” Within the next couple years, “these groups face a tidal wave of commercial real estate debt — some estimates peg the total at more than $3 trillion — that they will need to refinance. These loans were issued during this decade’s construction boom with the mistaken expectation that they would be refinanced on the same generous terms after a few years.”
However, as a result of the credit crisis, “few developers can find anyone to refinance their debt, endangering healthy and distressed properties.” Kim Diamond, a managing director at Standard & Poor’s, stated that, “It’s not a degree to which people are willing to lend,” but rather, “The question is whether a loan can be made at all.” Important to note is that, “Financial analysts said losses on commercial real estate loans are now the single largest cause of bank failures,” and that none of the bailout efforts enacted “is big enough to address the size of the problem.”[17]
So the question must be asked: what is Plan C contemplating in terms of a possible government “solution”? Another bailout? The effect that this would have would be to further inflate the already monumental bailout bubble.
The Great European Bubble
In October of 2008, Germany and France led a European Union bailout of 1 trillion Euros, and “World markets initially soared as European governments pumped billions into crippled banks. Central banks in Europe also mounted a new offensive to restart lending by supplying unlimited amounts of dollars to commercial banks in a joint operation.”[18]
The American bailouts even went to European banks, as it was reported in March of 2009 that, “European banks declined to discuss a report that they were beneficiaries of the $173 billion bail-out of insurer AIG,” as “Goldman Sachs, Morgan Stanley and a host of other U.S. and European banks had been paid roughly $50 billion since the Federal Reserve first extended aid to AIG.” Among the European banks, “French banks Societe Generale and Calyon on Sunday declined to comment on the story, as did Deutsche Bank, Britain’s Barclays and unlisted Dutch group Rabobank.” Other banks that got money from the US bailout include HSBC, Wachovia, Merrill Lynch, Banco Santander and Royal Bank of Scotland. Because AIG was essentially insolvent, “the bailout enabled AIG to pay its counterparty banks for extra collateral,” with “Goldman Sachs and Deutsche bank each receiving $6 billion in payments between mid-September and December.”[19]
In April of 2009, it was reported that, “EU governments have committed 3 trillion Euros[or $4 trillion dollars] to bail out banks with guarantees or cash injections in the wake of the global financial crisis, the European Commission.”[20]
In early February of 2009, the Telegraph published a story with a startling headline, “European banks may need 16.3 trillionpoundbail-out, EC document warns.” Type this headline into google, and the link to the Telegraph appears. However, click on the link, and the title has changed to “European bank bail-out could push EU into crisis.” Further, they removed any mention of the amount of money that may be required for a bank bailout. The amount in dollars, however, nears $25 trillion. The amount is the cumulative total of the troubled assets on bank balance sheets, a staggering number derived from the derivatives trade.
The Telegraph reported that, “National leaders and EU officials share fears that a second bank bail-out in Europe will raise government borrowing at a time when investors – particularly those who lend money to European governments – have growing doubts over the ability of countries such as Spain, Greece, Portugal, Ireland, Italy and Britain to pay it back.”[21]
When Eastern European countries were in desperate need of financial aid, and discussion was heated on the possibility of an EU bailout of Eastern Europe, the EU, at the behest of Angela Merkel of Germany, denied the East European bailout. However, this was more a public relations stunt than an actual policy position.
While the EU refused money to Eastern Europe in the form of a bailout, in late March European leaders “doubled the emergency funding for the fragile economies of central and eastern Europe and pledged to deliver another doubling of International Monetary Fund lending facilities by putting up 75bn Euros (70bn pounds).” EU leaders “agreed to increase funding for balance of payments support available for mainly eastern European member states from 25bn Eurosto 50bn Euros.”[22]
As explained in a Times article in June of 2009, Germany has been deceitful in its public stance versus its actual policy decisions. The article, worth quoting in large part, first explained that:
Europe is now in the middle of a perfect storm – a confluence of three separate, but interconnected economic crises which threaten far greater devastation than Britain or America have suffered from the credit crunch: the collapse of German industry and employment, the impending bankruptcy of Central European homeowners and businesses; and the threat of government debt defaults from loss of monetary control by the Irish Republic, Greece and Portugal, for instance on the eurozone periphery.
Taking the case of Latvia, the author asks, “If the crisis expands, other EU governments – and especially Germany’s – will face an existential question. Do they commit hundreds of billions of euros to guarantee the debts of fellow EU countries? Or do they allow government defaults and devaluations that may ultimately break up the single currency and further cripple German industry, as well as the country’s domestic banks?” While addressing that, “Publicly, German politicians have insisted that any bailouts or guarantees are out of the question,” however, “the pass has been quietly sold in Brussels, while politicians loudly protested their unshakeable commitment to defend it.”
The author addressed how in October of 2008:
[...] a previously unused regulation was discovered, allowing the creation of a 25 billion Euros“balance of payments facility” and authorising the EU to borrow substantial sums under its own “legal personality” for the first time. This facility was doubled again to 50 billion Eurosin March. If Latvia’s financial problems turn into a full-scale crisis, these guarantees and cross-subsidies between EU governments will increase to hundreds of billions in the months ahead and will certainly mutate into large-scale centralised EU borrowing, jointly guaranteed by all the taxpayers of the EU.
[...] The new EU borrowing, for example, is legally an ‘off-budget’ and ‘back-to-back’ arrangement, which allows Germany to maintain the legal fiction that it is not guaranteeing the debts of Latvia et al. The EU’s bond prospectus to investors, however, makes quite clear where the financial burden truly lies: “From an investor’s point of view the bond is fully guaranteed by the EU budget and, ultimately, by the EU Member States.”[23]
So Eastern Europe is getting, or presumably will get bailed out. Whether this is in the form of EU federalism, providing loans of its own accord, paid for by European taxpayers, or through the IMF, which will attach any loans with its stringent Structural Adjustment Program (SAP) conditionalities, or both. It turned out that the joint partnership of the IMF and EU is what provided the loans and continues to provide such loans.
As the Financial Times pointed out in August of 2009, “Bank failures or plunging currencies in the three Baltic nations – Latvia, Lithuania and Estonia – could threaten the fragile prospect of recovery in the rest of Europe. These countries also sit on one of the world’s most sensitive political fault-lines. They are the European Union’s frontier states, bordering Russia.” In July, Latvia “agreed its second loan in eight months from the IMF and the EU,” following the first one in December. Lithuania is reported to be following suit. However, as the Financial Times noted, the loans came with the IMF conditionalities: “The injection of cash is the good news. The bad news is that, in return for shoring up state finances, the new IMF deal will require the Latvian government to impose yet more pain on its suffering population. Public-sector wages have already been cut by about a third this year. Pensions have been sliced. Now the IMF requires Latvia to cut another 10 per cent from the state budget this autumn.”[24]
If we are to believe the brief Telegraph report pertaining to nearly $25 trillion in bad bank assets, which was removed from the original article for undisclosed reasons, not citing a factual retraction, the question is, does this potential bailout still stand? These banks haven’t been rescued financially from the EU, so, presumably, these bad assets are still sitting on the bank balance sheets. This bubble has yet to blow. Combine this with the $23.7 trillion US bailout bubble, and there is nearly $50 trillion between the EU and the US waiting to burst.
An Oil Bubble
In early July of 2009, the New York Times reported that, “The extreme volatility that has gripped oil markets for the last 18 months has shown no signs of slowing down, with oil prices more than doubling since the beginning of the year despite an exceptionally weak economy.” Instability in the oil and gas prices has led many to “fear it could jeopardize a global recovery.” Further, “It is also hobbling businesses and consumers,” as “A wild run on the oil markets has occurred in the last 12 months.” Oil prices reached a record high last summer at $145/barrel, and with the economic crisis they fell to $33/barrel in December. However, since the start of 2009, oil has risen 55% to $70/barrel.
As the Times article points out, “the recent rise in oil prices is reprising the debate from last year over the role of investors — or speculators — in the commodity markets.” Energy officials from the EU and OPEC met in June and concluded that, “the speculation issue had not been resolved yet and that the 2008 bubble could be repeated.”[25]
In June of 2009, Hedge Fund manager Michael Masters told the US Senate that, “Congress has not done enough to curb excessive speculation in the oil markets, leaving the country vulnerable to another price run-up in 2009.” He explained that, “oil prices are largely not determined by supply and demand but the trading desks of large Wall Street firms.” Because “Nothing was actually done by Congress to put an end to the problem of excessive speculation” in 2008, Masters explained, “there is nothing to prevent another bubble in oil prices in 2009. In fact, signs of another possible bubble are already beginning to appear.”[26]
In May of 2008, Goldman Sachs warned that oil could reach as much as $200/barrel within the next 12-24 months [up to May 2010]. Interestingly, “Goldman Sachs is one of the largest Wall Street investment banks trading oil and it could profit from an increase in prices.”[27] However, this is missing the key point. Not only would Goldman Sachs profit, but Goldman Sachs plays a major role in sending oil prices up in the first place.
As Ed Wallace pointed out in an article in Business Week in May of 2008, Goldman Sachs’ report placed the blame for such price hikes on “soaring demand” from China and the Middle East, combined with the contention that the Middle East has or would soon peak in its oil reserves. Wallace pointed out that:
Goldman Sachs was one of the founding partners of online commodities and futures marketplace Intercontinental Exchange (ICE). And ICE has been a primary focus of recent congressional investigations; it was named both in the Senate’s Permanent Subcommittee on Investigations’ June 27, 2006, Staff Report and in the House Committee on Energy & Commerce’s hearing last December. Those investigations looked into the unregulated trading in energy futures, and both concluded that energy prices’ climb to stratospheric heights has been driven by the billions of dollars’ worth of oil and natural gas futures contracts being placed on the ICE—which is not regulated by the Commodities Futures Trading Commission.[28]
Essentially, Goldman Sachs is one of the key speculators in the oil market, and thus, plays a major role in driving oil prices up on speculation. This must be reconsidered in light of the resurgent rise in oil prices in 2009. In July of 2009, “Goldman Sachs Group Inc. posted record earnings as revenue from trading and stock underwriting reached all-time highs less than a year after the firm took $10 billion in U.S. rescue funds.”[29] Could one be related to the other?
Bailouts Used in Speculation
In November of 2008, the Chinese government injected an “$849 billion stimulus package aimed at keeping the emerging economic superpower growing.”[30] China then recorded a rebound in the growth rate of the economy, and underwent a stock market boom. However, as the Wall Street Journal pointed out in July of 2009, “Its growth is now fuelled by cheap debt rather than corporate profits and retained earnings, and this shift in the medium term threatens to undermine China’s economic decoupling from the global slump.” Further, “overseas money has been piling into China, inflating foreign exchange reserves and domestic liquidity. So perhaps it is not surprising that outstanding bank loans have doubled in the last few years, or that there is much talk of a shadow banking system. Then there is China’s reputation for building overcapacity in its industrial sector, a notoriety it won even before the crash in global demand. This showed a disregard for returns that is always a tell-tale sign of cheap money.”
China’s economy primarily relies upon the United States as a consumption market for its cheap products. However, “The slowdown in U.S. consumption amid a credit crunch has exposed the weaknesses in this export-led financing model. So now China is turning instead to cheap debt for funding, a shift suggested by this year’s 35% or so rise in bank loans.”[31]
In August of 2009, it was reported that China is experiencing a “stimulus-fueled stock market boom.” However, this has caused many leaders to “worry that too much of the $1-trillion lending binge by state banks that paid for China’s nascent revival was diverted into stocks and real estate, raising the danger of a boom and bust cycle and higher inflation less than two years after an earlier stock market bubble burst.”[32]
The same reasoning needs to be applied to the US stock market surge. Something is inherently and structurally wrong with a financial system in which nothing is being produced, 600,000 jobs are lost monthly, and yet, the stock market goes up. Why is the stock market going up?
The Troubled Asset Relief Program (TARP), which provided $700 billion in bank bailouts, started under Bush and expanded under Obama, entails that the US Treasury purchases $700 billion worth of “troubled assets” from banks, and in turn, “that banks cannot be asked to account for their use of taxpayer money.”[33]
So if banks don’t have to account for where the money goes, where did it go? They claim it went back into lending. However, bank lending continues to go down.[34] Stock market speculation is the likely answer. Why else would stocks go up, lending continue downwards, and the bailout money be unaccounted for?
What Does the Bank for International Settlements (BIS) Have to Say?
In late June, the Bank for International Settlements (BIS), the central bank of the world’s central banks, the most prestigious and powerful financial organization in the world, delivered an important warning. It stated that, “fiscal stimulus packages may provide no more than a temporary boost to growth, and be followed by an extended period of economic stagnation.”
The BIS, “The only international body to correctly predict the financial crisis… has warned the biggest risk is that governments might be forced by world bond investors to abandon their stimulus packages, and instead slash spending while lifting taxes and interest rates,” as the annual report of the BIS “has for the past three years been warning of the dangers of a repeat of the depression.” Further, “Its latest annual report warned that countries such as Australia faced the possibility of a run on the currency, which would force interest rates to rise.” The BIS warned that, “a temporary respite may make it more difficult for authorities to take the actions that are necessary, if unpopular, to restore the health of the financial system, and may thus ultimately prolong the period of slow growth.”
Of immense import is the BIS warning that, “At the same time, government guarantees and asset insurance have exposed taxpayers to potentially large losses,” and explaining how fiscal packages posed significant risks, it said that, “There is a danger that fiscal policy-makers will exhaust their debt capacity before finishing the costly job of repairing the financial system,” and that, “There is the definite possibility that stimulus programs will drive up real interest rates and inflation expectations.” Inflation “would intensify as the downturn abated,” and the BIS “expressed doubt about the bank rescue package adopted in the US.”[35]
The BIS further warned of inflation, saying that, “The big and justifiable worry is that, before it can be reversed, the dramatic easing in monetary policy will translate into growth in the broader monetary and credit aggregates,” the BIS said. That will “lead to inflation that feeds inflation expectations or it may fuel yet another asset-price bubble, sowing the seeds of the next financial boom-bust cycle.”[36]
Major investors have also been warning about the dangers of inflation. Legendary investor Jim Rogers has warned of “a massive inflation holocaust.”[37] Investor Marc Faber has warned that, “The U.S. economy will enter ‘hyperinflation’ approaching the levels in Zimbabwe,” and he stated that he is “100 percent sure that the U.S. will go into hyperinflation.” Further, “The problem with government debt growing so much is that when the time will come and the Fed should increase interest rates, they will be very reluctant to do so and so inflation will start to accelerate.”[38]
Are We Entering A New Great Depression?
In 2007, it was reported that, “The Bank for International Settlements, the world’s most prestigious financial body, has warned that years of loose monetary policy has fuelled a dangerous credit bubble, leaving the global economy more vulnerable to another 1930s-style slump than generally understood.” Further:
The BIS, the ultimate bank of central bankers, pointed to a confluence a worrying signs, citing mass issuance of new-fangled credit instruments, soaring levels of household debt, extreme appetite for risk shown by investors, and entrenched imbalances in the world currency system.
[...] In a thinly-veiled rebuke to the US Federal Reserve, the BIS said central banks were starting to doubt the wisdom of letting asset bubbles build up on the assumption that they could safely be “cleaned up” afterwards – which was more or less the strategy pursued by former Fed chief Alan Greenspan after the dotcom bust.[39]
In 2008, the BIS again warned of the potential of another Great Depression, as “complex credit instruments, a strong appetite for risk, rising levels of household debt and long-term imbalances in the world currency system, all form part of the loose monetarist policy that could result in another Great Depression.”[40]
In 2008, the BIS also said that, “The current market turmoil is without precedent in the postwar period. With a significant risk of recession in the US, compounded by sharply rising inflation in many countries, fears are building that the global economy might be at some kind of tipping point,” and that all central banks have done “has been to put off the day of reckoning.”[41]
In late June of 2009, the BIS reported that as a result of stimulus packages, it has only seen “limited progress” and that, “the prospects for growth are at risk,” and further “stimulus measures won’t be able to gain traction, and may only lead to a temporary pickup in growth.” Ultimately, “A fleeting recovery could well make matters worse.”[42]
The BIS has said, in softened language, that the stimulus packages are ultimately going to cause more damage than they prevented, simply delaying the inevitable and making the inevitable that much worse. Given the previous BIS warnings of a Great Depression, the stimulus packages around the world have simply delayed the coming depression, and by adding significant numbers to the massive debt bubbles of the world’s nations, will ultimately make the depression worse than had governments not injected massive amounts of money into the economy.
After the last Great Depression, Keynesian economists emerged victorious in proposing that a nation must spend its way out of crisis. This time around, they will be proven wrong. The world is a very different place now. Loose credit, easy spending and massive debt is what has led the world to the current economic crisis, spending is not the way out. The world has been functioning on a debt based global economy. This debt based monetary system, controlled and operated by the global central banking system, of which the apex is the Bank for International Settlements, is unsustainable. This is the real bubble, the debt bubble. When it bursts, and it will burst, the world will enter into the Greatest Depression in world history.
Notes
[1] Barrie McKenna, End of housing slump? Try telling that to buyers, sellers and the unemployed. The Globe and Mail: August 6, 2009:
http://www.theglobeandmail.com/report-on-business/end-of-housing-slump-try-telling-that-to-buyers-sellers-and-the-unemployed/article1240418/
[2] Gene Sperling, Double-Bubble Trouble in Commercial Real Estate: Gene Sperling. Bloomberg: May 9, 2009:
http://www.bloomberg.com/apps/news?pid=20601110&sid=a.X91SkgOd8g
[3] AL Sull, Commercial Real Estate – The Other Real Estate Bubble. Financial Post: July 23, 2009:
http://network.nationalpost.com/np/blogs/fpmagazinedaily/archive/2009/07/23/commercial-real-estate-the-other-real-estate-bubble.aspx
[4] Hui-yong Yu, U.S. Office Vacancies Rise to Three-Year High, Cushman Says. Bloomberg: April 16, 2009:
http://www.bloomberg.com/apps/news?pid=20601087&sid=aegH6dXG8H8U
[5] Parija B. Kavilanz, Malls shedding stores at record pace. CNN Money: April 14, 2009:
http://money.cnn.com/2009/04/10/news/economy/retail_malls/index.htm
[6] Ilaina Jonas and Emily Chasan, General Growth files largest U.S. real estate bankruptcy. Reuters: April 16, 2009:
http://www.reuters.com/article/businessNews/idUSTRE53F68P20090417
[7] Jamil Anderlini, China property prices ‘likely to halve’. The Financial Times: April 13, 2009:
http://www.ft.com/cms/s/0/9a36b342-280e-11de-8dbf-00144feabdc0.html
[8] Reuters, Fed Might Extend TALF Support to Five Years. Money News: April 17, 2009:
http://moneynews.newsmax.com/financenews/talf/2009/04/17/204120.html?utm_medium=RSS
[9] Francesco Guerrera and Greg Farrell, US banks warn on commercial property. The Financial Times: July 22, 2009:
http://www.ft.com/cms/s/0/3a1e9d86-76eb-11de-b23c-00144feabdc0.html
[10] Mark Pittman and Bob Ivry, Financial Rescue Nears GDP as Pledges Top $12.8 Trillion. Bloomberg: March 31, 2009:
http://www.bloomberg.com/apps/news?pid=20601087&sid=armOzfkwtCA4
[11] Gerald Celente, The “Bailout Bubble” – The Bubble to End All Bubbles. Trends Research Institute: May 13, 2009:
http://geraldcelentechannel.blogspot.com/2009/05/gerald-celente-bubble-to-end-all.html
[12] Tom Braithwaite, Treasury clashes with Tarp watchdog on data. The Financial Times: July 20, 2009:
http://www.ft.com/cms/s/0/ab533a38-757a-11de-9ed5-00144feabdc0.html
[13] AFP, US could spend 23.7 trillion dollars on crisis: report. Agence-France Presse: July 20, 2009:
http://www.google.com/hostednews/afp/article/ALeqM5iuL1HParBuO4WyHJIxw6rlOKdz-A
[14] John Whitesides, Warren Buffett says second stimulus might be needed. Reuters: July 9, 2009:
http://www.reuters.com/article/pressReleasesMolt/idUSTRE5683MZ20090709
[15] Vidya Ranganathan, U.S. should plan 2nd fiscal stimulus: economic adviser. Reuters: July 7, 2009:
http://www.reuters.com/article/newsOne/idUSTRE56611D20090707
[16] Carly Crawford, US may increase stimulus payments to rein in unemployment. The Herald Sun: August 3, 2009:
http://www.news.com.au/heraldsun/story/0,21985,25873672-664,00.html
[17] David Cho and Binyamin Appelbaum, Treasury Works on ‘Plan C’ To Fend Off Lingering Threats. The Washington Post: July 8, 2009:
http://www.washingtonpost.com/wp-dyn/content/article/2009/07/07/AR2009070702631.html?hpid=topnews
[18] Charles Bremner and David Charter, Germany and France lead €1 trillion European bailout. Times Online: October 13, 2009:
http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article4937516.ece
[19] Douwe Miedema, Europe banks silent on reported AIG bailout gains. Reuters: March 8, 2009:
http://www.reuters.com/article/topNews/idUSTRE5270YD20090308
[20] Elitsa Vucheva, European Bank Bailout Total: $4 Trillion. Business Week: April 10, 2009:
http://www.businessweek.com/globalbiz/content/apr2009/gb20090410_254738.htm?chan=globalbiz_europe+index+page_top+stories
[21] Bruno Waterfield, European bank bail-out could push EU into crisis. The Telegraph: February 11, 2009:
http://www.telegraph.co.uk/finance/financetopics/financialcrisis/4590512/European-banks-may-need-16.3-trillion-bail-out-EC-dcoument-warns.html
[22] Ian Traynor, EU doubles funding for fragile eastern European economies. The Guardian: March 20, 2009:
http://www.guardian.co.uk/world/2009/mar/20/eu-imf-emergency-funding
[23] Anatole Kaletsky, The great bailout – Europe’s best-kept secret. The Times Online: June 4, 2009:
http://www.timesonline.co.uk/tol/comment/columnists/anatole_kaletsky/article6426565.ece
[24] Gideon Rachman, Europe prepares for a Baltic blast. The Financial Times: August 3, 2009:
http://www.ft.com/cms/s/0/b497f5b6-8060-11de-bf04-00144feabdc0.html
[25] JAD MOUAWAD, Swings in Price of Oil Hobble Forecasting. The New York Times: July 5, 2009:
http://www.nytimes.com/2009/07/06/business/06oil.html
[26] Christopher Doering, Masters says signs of oil bubble starting to appear. Reuters: June 4, 2009:
http://www.reuters.com/article/Inspiration/idUSTRE55355620090604
[27] Javier Blas and Chris Flood, Analyst warns of oil at $200 a barrel. The Financial Times: May 6, 2008:
http://us.ft.com/ftgateway/superpage.ft?news_id=fto050620081414392593
[28] Ed Wallace, The Reason for High Oil Prices. Business Week: May 13, 2009:
http://www.businessweek.com/lifestyle/content/may2008/bw20080513_720178.htm
[29] Christine Harper, Goldman Sachs Posts Record Profit, Beating Estimates. Bloomberg: July 14, 2009:
http://www.bloomberg.com/apps/news?pid=20601087&sid=a2jo3RK2_Aps
[30] Peter Martin and John Garnaut, The great China bailout. The Age: November 11, 2008:
http://business.theage.com.au/business/the-great-china-bailout-20081110-5lpe.html
[31] Paul Cavey, Now China Has a Credit Boom. The Wall Street Journal: July 30, 2009:
http://online.wsj.com/article/SB10001424052970204619004574319261337617196.html
[32] Joe McDonald, China’s stimulus-fueled stock boom alarms Beijing. The Globe and Mail: August 2, 2009:
http://www.globeinvestor.com/servlet/story/RTGAM.20090802.wchina02/GIStory/
[33] Matt Jaffe, Watchdog Refutes Treasury Claim Banks Cannot Be Asked to Account for Bailout Cash. ABC News: July 19, 2009:
http://abcnews.go.com/Business/Politics/story?id=8121045&page=1
[34] The China Post, Bank lending slows down in U.S.: report. The China Post: July 28, 2009:
http://www.chinapost.com.tw/business/americas/2009/07/28/218141/Bank-lending.htm
[35] David Uren. Bank for International Settlements warning over stimulus benefits. The Australian: June 30, 2009:
http://www.theaustralian.news.com.au/story/0,,25710566-601,00.html
[36] Simone Meier, BIS Sees Risk Central Banks Will Raise Interest Rates Too Late. Bloomberg: June 29, 2009:
http://www.bloomberg.com/apps/news?pid=20601068&sid=aOnSy9jXFKaY
[37] CNBC.com, We Are Facing an ‘Inflation Holocaust’: Jim Rogers. CNBC: October 10, 2008:
http://www.cnbc.com/id/27097823
[38] Chen Shiyin and Bernard Lo, U.S. Inflation to Approach Zimbabwe Level, Faber Says. Bloomberg: May 27, 2009:
http://www.bloomberg.com/apps/news?pid=20601110&sid=avgZDYM6mTFA
[39] Ambrose Evans-Pritchard, BIS warns of Great Depression dangers from credit spree. The Telegraph: June 27, 2009:
http://www.telegraph.co.uk/finance/economics/2811081/BIS-warns-of-Great-Depression-dangers-from-credit-spree.html
[40] Gill Montia, Central bank body warns of Great Depression. Banking Times: June 9, 2008:
http://www.bankingtimes.co.uk/09062008-central-bank-body-warns-of-great-depression/
[41] Ambrose Evans-Pritchard, BIS slams central banks, warns of worse crunch to come. The Telegraph: June 30, 2008:
http://www.telegraph.co.uk/finance/markets/2792450/BIS-slams-central-banks-warns-of-worse-crunch-to-come.html
[42] HEATHER SCOFFIELD, Financial repairs must continue: central banks. The Globe and Mail: June 29, 2009:
http://v1.theglobeandmail.com/servlet/story/RTGAM.20090629.wcentralbanks0629/BNStory/HEATHER+SCOFFIELD/
Andrew Gavin Marshall is a Research Associate with the Centre for Research on Globalization (CRG). He is currently studying Political Economy and History at Simon Fraser University.
Global Research
Friday, August 7, 2009
Introduction
While there is much talk of a recovery on the horizon, commentators are forgetting some crucial aspects of the financial crisis. The crisis is not simply composed of one bubble, the housing real estate bubble, which has already burst. The crisis has many bubbles, all of which dwarf the housing bubble burst of 2008. Indicators show that the next possible burst is the commercial real estate bubble. However, the main event on the horizon is the “bailout bubble” and the general world debt bubble, which will plunge the world into a Great Depression the likes of which have never before been seen.
Housing Crash Still Not Over
The housing real estate market, despite numbers indicating an upward trend, is still in trouble, as, “Houses are taking months to sell. Many buyers are having trouble getting financing as lenders and appraisers struggle to figure out what houses are really worth in the wake of the collapse.” Further, “the overall market remains very soft [...] aside from speculators and first-time buyers.” Dean Baker, co-director of the Center for Economic and Policy Research in Washington said, “It would be wrong to imagine that we have hit a turning point in the market,” as “There is still an enormous oversupply of housing, which means that the direction of house prices will almost certainly continue to be downward.” Foreclosures are still rising in many states “such as Nevada, Georgia and Utah, and economists say rising unemployment may push foreclosures higher into next year.” Clearly, the housing crisis is still not at an end.[1]
The Commercial Real Estate Bubble
In May, Bloomberg quoted Deutsche Bank CEO Josef Ackermann as saying, “It’s either the beginning of the end or the end of the beginning.” Bloomberg further pointed out that, “A piece of the puzzle that must be calculated into any determination of the depth of our economic doldrums is the condition of commercial real estate — the shopping malls, hotels, and office buildings that tend to go along with real- estate expansions.” Residential investment went down 28.9 % from 2006 to 2007, and at the same time, nonresidential investment grew 24.9%, thus, commercial real estate was “serving as a buffer against the declining housing market.”
Commercial real estate lags behind housing trends, and so too, will the crisis, as “commercial construction projects are losing their appeal.” Further, “there are lots of reasons to suspect that commercial real estate was subject to some of the loose lending practices that afflicted the residential market. The Office of the Comptroller of the Currency’s Survey of Credit Underwriting Practices found that whereas in 2003 just 2 percent of banks were easing their underwriting standards on commercial construction loans, by 2006 almost a third of them were relaxing.” In May it was reported that, “Almost 80 percent of domestic banks are tightening their lending standards for commercial real-estate loans,” and that, “we may face double-bubble trouble for real estate and the economy.”[2]
In late July of 2009, it was reported that, “Commercial real estate’s decline is a significant issue facing the economy because it may result in more losses for the financial industry than residential real estate. This category includes apartment buildings, hotels, office towers, and shopping malls.” Worth noting is that, “As the economy has struggled, developers and landlords have had to rely on a helping hand from the US Federal Reserve in order to try to get credit flowing so that they can refinance existing buildings or even to complete partially constructed projects.” So again, the Fed is delaying the inevitable by providing more liquidity to an already inflated bubble. As the Financial Post pointed out, “From Vancouver to Manhattan, we are seeing rising office vacancies and declines in office rents.”[3]
In April of 2009, it was reported that, “Office vacancies in U.S. downtowns increased to 12.5 percent in the first quarter, the highest in three years, as companies cut jobs and new buildings came onto the market,” and, “Downtown office vacancies nationwide could come close to 15 percent by the end of this year, approaching the 10-year high of 15.5 percent in 2003.”[4]
In the same month it was reported that, “Strip malls, neighborhood centers and regional malls are losing stores at the fastest pace in at least a decade, as a spending slump forces retailers to trim down to stay afloat.” In the first quarter of 2009, retail tenants “have vacated 8.7 million square feet of commercial space,” which “exceeds the 8.6 million square feet of retail space that was vacated in all of 2008.” Further, as CNN reported, “vacancy rates at malls rose 9.5% in the first quarter, outpacing the 8.9% vacancy rate registered in all of 2008.” Of significance for those that think and claim the crisis will be over by 2010, “mall vacancies [are expected] to exceed historical levels through 2011,” as for retailers, “it’s only going to get worse.”[5] Two days after the previous report, “General Growth Properties Inc, the second-largest U.S. mall owner, declared bankruptcy on [April 16] in the biggest real estate failure in U.S. history.”[6]
In April, the Financial Times reported that, “Property prices in China are likely to halve over the next two years, a top government researcher has predicted in a powerful signal that the country’s economic downturn faces further challenges despite recent positive data.” This is of enormous significance, as “The property market, along with exports, were leading drivers of the booming Chinese economy over the past decade.” Further, “an apparent rebound in the property market was unsustainable over the medium term and being driven by a flood of liquidity and fraudulent activity rather than real demand.” A researcher at a leading Chinese government think tank reported that, “he expected average urban residential property prices to fall by 40 to 50 per cent over the next two years from their levels at the end of 2008.”[7]
In April, it was reported that, “The Federal Reserve is considering offering longer loans to investors in commercial mortgage-backed securities as part of a plan to help jump-start the market for commercial real estate debt.” Since February the Fed “has been analyzing appropriate terms and conditions for accepting commercial mortgage-backed securities (CMBS) and other mortgage assets as collateral for its Term Asset-Backed Securities Lending Facility (TALF).”[8]
In late July, the Financial Times reported that, “Two of America’s biggest banks, Morgan Stanley and Wells Fargo …threw into sharp relief the mounting woes of the US commercial property market when they reported large losses and surging bad loan,” as “The disappointing second-quarter results for two of the largest lenders and investors in office, retail and industrial property across the US confirmed investors’ fears that commercial real estate would be the next front in the financial crisis after the collapse of the housing market.” The commercial property market, worth $6.7 trillion, “which accounts for more than 10 per cent of US gross domestic product, could be a significant hurdle on the road to recovery.”[9]
The Bailout Bubble
While the bailout, or the “stimulus package” as it is often referred to, is getting good coverage in terms of being portrayed as having revived the economy and is leading the way to the light at the end of the tunnel, key factors are again misrepresented in this situation.
At the end of March of 2009, Bloomberg reported that, “The U.S. government and the Federal Reserve have spent, lent or committed $12.8 trillion, an amount that approaches the value of everything produced in the country last year.” This amount “works out to $42,105 for every man, woman and child in the U.S. and 14 times the $899.8 billion of currency in circulation. The nation’s gross domestic product was $14.2 trillion in 2008.”[10]
Gerald Celente, the head of the Trends Research Institute, the major trend-forecasting agency in the world, wrote in May of 2009 of the “bailout bubble.” Celente’s forecasts are not to be taken lightly, as he accurately predicted the 1987 stock market crash, the fall of the Soviet Union, the 1998 Russian economic collapse, the 1997 East Asian economic crisis, the 2000 Dot-Com bubble burst, the 2001 recession, the start of a recession in 2007 and the housing market collapse of 2008, among other things.
On May 13, 2009, Celente released a Trend Alert, reporting that, “The biggest financial bubble in history is being inflated in plain sight,” and that, “This is the Mother of All Bubbles, and when it explodes [...] it will signal the end to the boom/bust cycle that has characterized economic activity throughout the developed world.” Further, “This is much bigger than the Dot-com and Real Estate bubbles which hit speculators, investors and financiers the hardest. However destructive the effects of these busts on employment, savings and productivity, the Free Market Capitalist framework was left intact. But when the ‘Bailout Bubble’ explodes, the system goes with it.”
Celente further explained that, “Phantom dollars, printed out of thin air, backed by nothing… and producing next to nothing… defines the ‘Bailout Bubble.’ Just as with the other bubbles, so too will this one burst. But unlike Dot-com and Real Estate, when the “Bailout Bubble” pops, neither the President nor the Federal Reserve will have the fiscal fixes or monetary policies available to inflate another.” Celente elaborated, “Given the pattern of governments to parlay egregious failures into mega-failures, the classic trend they follow, when all else fails, is to take their nation to war,” and that, “While we cannot pinpoint precisely when the ‘Bailout Bubble’ will burst, we are certain it will. When it does, it should be understood that a major war could follow.”[11]
However, this “bailout bubble” that Celente was referring to at the time was the $12.8 trillion reported by Bloomberg. As of July, estimates put this bubble at nearly double the previous estimate.
As the Financial Times reported in late July of 2009, while the Fed and Treasury hail the efforts and impact of the bailouts, “Neil Barofsky, special inspector-general for the troubled asset relief programme, [TARP] said that the various US schemes to shore up banks and restart lending exposed federal agencies to a risk of $23,700bn [$23.7 trillion] – a vast estimate that was immediately dismissed by the Treasury.” The inspector-general of the TARP program stated that there were “fundamental vulnerabilities...relating to conflicts of interest and collusion, transparency, performance measures, and anti-money laundering.”
Barofsky also reports on the “considerable stress” in commercial real estate, as “The Fed has begun to open up Talf to commercial mortgage-backed securities to try to influence credit conditions in the commercial real estate market. The report draws attention to a new potential credit crunch when $500bn worth of real estate mortgages need to be refinanced by the end of the year.” Ben Bernanke, the Chairman of the Fed, and Timothy Geithner, the Treasury Secretary and former President of the New York Fed, are seriously discussing extending TALF (Term Asset-Backed Securities Lending Facility) into “CMBS [Commercial Mortgage-Backed Securities] and other assets such as small business loans and whether to increase the size of the programme.” It is the “expansion of the various programmes into new and riskier asset classes is one of the main bones of contention between the Treasury and Mr Barofsky.”[12]
Testifying before Congress, Barofsky said, “From programs involving large capital infusions into hundreds of banks and other financial institutions, to a mortgage modification program designed to modify millions of mortgages, to public-private partnerships using tens of billions of taxpayer dollars to purchase ‘toxic’ assets from banks, TARP has evolved into a program of unprecedented scope, scale, and complexity.” He explained that, “The total potential federal government support could reach up to 23.7 trillion dollars.”[13]
Is a Future Bailout Possible?
In early July of 2009, billionaire investor Warren Buffet said that, “unemployment could hit 11 percent and a second stimulus package might be needed as the economy struggles to recover from recession,” and he further stated that, “we’re not in a recovery.”[14] Also in early July, an economic adviser to President Obama stated that, “The United States should be planning for a possible second round of fiscal stimulus to further prop up the economy.”[15]
In August of 2009, it was reported that, “THE Obama administration will consider dishing out more money to rein in unemployment despite signs the recession is ending,” and that, “Treasury secretary Tim Geithner also conceded tax hikes could be on the agenda as the government worked to bring its huge recovery-related deficits under control.” Geithner said, “we will do what it takes,” and that, “more federal cash could be tipped into the recovery as unemployment benefits amid projections the benefits extended to 1.5 million jobless Americans will expire without Congress’ intervention.” However, any future injection of money could be viewed as “a second stimulus package.”[16]
The Washington Post reported in early July of a Treasury Department initiative known as “Plan C.” The Plan C team was assembled “to examine what could yet bring [the economy] down and has identified several trouble spots that could threaten the still-fragile lending industry,” and “the internal project is focused on vexing problems such as the distressed commercial real estate markets, the high rate of delinquencies among homeowners, and the struggles of community and regional banks.”
Further, “The team is also responsible for considering potential government responses, but top officials within the Obama administration are wary of rolling out initiatives that would commit massive amounts of federal resources.” The article elaborated in saying that, “The creation of Plan C is a sign that the government has moved into a new phase of its response, acting preemptively rather than reacting to emerging crises.” In particular, the near-term challenge they are facing is commercial real estate lending, as “Banks and other firms that provided such loans in the past have sharply curtailed lending,” leaving “many developers and construction companies out in the cold.” Within the next couple years, “these groups face a tidal wave of commercial real estate debt — some estimates peg the total at more than $3 trillion — that they will need to refinance. These loans were issued during this decade’s construction boom with the mistaken expectation that they would be refinanced on the same generous terms after a few years.”
However, as a result of the credit crisis, “few developers can find anyone to refinance their debt, endangering healthy and distressed properties.” Kim Diamond, a managing director at Standard & Poor’s, stated that, “It’s not a degree to which people are willing to lend,” but rather, “The question is whether a loan can be made at all.” Important to note is that, “Financial analysts said losses on commercial real estate loans are now the single largest cause of bank failures,” and that none of the bailout efforts enacted “is big enough to address the size of the problem.”[17]
So the question must be asked: what is Plan C contemplating in terms of a possible government “solution”? Another bailout? The effect that this would have would be to further inflate the already monumental bailout bubble.
The Great European Bubble
In October of 2008, Germany and France led a European Union bailout of 1 trillion Euros, and “World markets initially soared as European governments pumped billions into crippled banks. Central banks in Europe also mounted a new offensive to restart lending by supplying unlimited amounts of dollars to commercial banks in a joint operation.”[18]
The American bailouts even went to European banks, as it was reported in March of 2009 that, “European banks declined to discuss a report that they were beneficiaries of the $173 billion bail-out of insurer AIG,” as “Goldman Sachs, Morgan Stanley and a host of other U.S. and European banks had been paid roughly $50 billion since the Federal Reserve first extended aid to AIG.” Among the European banks, “French banks Societe Generale and Calyon on Sunday declined to comment on the story, as did Deutsche Bank, Britain’s Barclays and unlisted Dutch group Rabobank.” Other banks that got money from the US bailout include HSBC, Wachovia, Merrill Lynch, Banco Santander and Royal Bank of Scotland. Because AIG was essentially insolvent, “the bailout enabled AIG to pay its counterparty banks for extra collateral,” with “Goldman Sachs and Deutsche bank each receiving $6 billion in payments between mid-September and December.”[19]
In April of 2009, it was reported that, “EU governments have committed 3 trillion Euros[or $4 trillion dollars] to bail out banks with guarantees or cash injections in the wake of the global financial crisis, the European Commission.”[20]
In early February of 2009, the Telegraph published a story with a startling headline, “European banks may need 16.3 trillionpoundbail-out, EC document warns.” Type this headline into google, and the link to the Telegraph appears. However, click on the link, and the title has changed to “European bank bail-out could push EU into crisis.” Further, they removed any mention of the amount of money that may be required for a bank bailout. The amount in dollars, however, nears $25 trillion. The amount is the cumulative total of the troubled assets on bank balance sheets, a staggering number derived from the derivatives trade.
The Telegraph reported that, “National leaders and EU officials share fears that a second bank bail-out in Europe will raise government borrowing at a time when investors – particularly those who lend money to European governments – have growing doubts over the ability of countries such as Spain, Greece, Portugal, Ireland, Italy and Britain to pay it back.”[21]
When Eastern European countries were in desperate need of financial aid, and discussion was heated on the possibility of an EU bailout of Eastern Europe, the EU, at the behest of Angela Merkel of Germany, denied the East European bailout. However, this was more a public relations stunt than an actual policy position.
While the EU refused money to Eastern Europe in the form of a bailout, in late March European leaders “doubled the emergency funding for the fragile economies of central and eastern Europe and pledged to deliver another doubling of International Monetary Fund lending facilities by putting up 75bn Euros (70bn pounds).” EU leaders “agreed to increase funding for balance of payments support available for mainly eastern European member states from 25bn Eurosto 50bn Euros.”[22]
As explained in a Times article in June of 2009, Germany has been deceitful in its public stance versus its actual policy decisions. The article, worth quoting in large part, first explained that:
Europe is now in the middle of a perfect storm – a confluence of three separate, but interconnected economic crises which threaten far greater devastation than Britain or America have suffered from the credit crunch: the collapse of German industry and employment, the impending bankruptcy of Central European homeowners and businesses; and the threat of government debt defaults from loss of monetary control by the Irish Republic, Greece and Portugal, for instance on the eurozone periphery.
Taking the case of Latvia, the author asks, “If the crisis expands, other EU governments – and especially Germany’s – will face an existential question. Do they commit hundreds of billions of euros to guarantee the debts of fellow EU countries? Or do they allow government defaults and devaluations that may ultimately break up the single currency and further cripple German industry, as well as the country’s domestic banks?” While addressing that, “Publicly, German politicians have insisted that any bailouts or guarantees are out of the question,” however, “the pass has been quietly sold in Brussels, while politicians loudly protested their unshakeable commitment to defend it.”
The author addressed how in October of 2008:
[...] a previously unused regulation was discovered, allowing the creation of a 25 billion Euros“balance of payments facility” and authorising the EU to borrow substantial sums under its own “legal personality” for the first time. This facility was doubled again to 50 billion Eurosin March. If Latvia’s financial problems turn into a full-scale crisis, these guarantees and cross-subsidies between EU governments will increase to hundreds of billions in the months ahead and will certainly mutate into large-scale centralised EU borrowing, jointly guaranteed by all the taxpayers of the EU.
[...] The new EU borrowing, for example, is legally an ‘off-budget’ and ‘back-to-back’ arrangement, which allows Germany to maintain the legal fiction that it is not guaranteeing the debts of Latvia et al. The EU’s bond prospectus to investors, however, makes quite clear where the financial burden truly lies: “From an investor’s point of view the bond is fully guaranteed by the EU budget and, ultimately, by the EU Member States.”[23]
So Eastern Europe is getting, or presumably will get bailed out. Whether this is in the form of EU federalism, providing loans of its own accord, paid for by European taxpayers, or through the IMF, which will attach any loans with its stringent Structural Adjustment Program (SAP) conditionalities, or both. It turned out that the joint partnership of the IMF and EU is what provided the loans and continues to provide such loans.
As the Financial Times pointed out in August of 2009, “Bank failures or plunging currencies in the three Baltic nations – Latvia, Lithuania and Estonia – could threaten the fragile prospect of recovery in the rest of Europe. These countries also sit on one of the world’s most sensitive political fault-lines. They are the European Union’s frontier states, bordering Russia.” In July, Latvia “agreed its second loan in eight months from the IMF and the EU,” following the first one in December. Lithuania is reported to be following suit. However, as the Financial Times noted, the loans came with the IMF conditionalities: “The injection of cash is the good news. The bad news is that, in return for shoring up state finances, the new IMF deal will require the Latvian government to impose yet more pain on its suffering population. Public-sector wages have already been cut by about a third this year. Pensions have been sliced. Now the IMF requires Latvia to cut another 10 per cent from the state budget this autumn.”[24]
If we are to believe the brief Telegraph report pertaining to nearly $25 trillion in bad bank assets, which was removed from the original article for undisclosed reasons, not citing a factual retraction, the question is, does this potential bailout still stand? These banks haven’t been rescued financially from the EU, so, presumably, these bad assets are still sitting on the bank balance sheets. This bubble has yet to blow. Combine this with the $23.7 trillion US bailout bubble, and there is nearly $50 trillion between the EU and the US waiting to burst.
An Oil Bubble
In early July of 2009, the New York Times reported that, “The extreme volatility that has gripped oil markets for the last 18 months has shown no signs of slowing down, with oil prices more than doubling since the beginning of the year despite an exceptionally weak economy.” Instability in the oil and gas prices has led many to “fear it could jeopardize a global recovery.” Further, “It is also hobbling businesses and consumers,” as “A wild run on the oil markets has occurred in the last 12 months.” Oil prices reached a record high last summer at $145/barrel, and with the economic crisis they fell to $33/barrel in December. However, since the start of 2009, oil has risen 55% to $70/barrel.
As the Times article points out, “the recent rise in oil prices is reprising the debate from last year over the role of investors — or speculators — in the commodity markets.” Energy officials from the EU and OPEC met in June and concluded that, “the speculation issue had not been resolved yet and that the 2008 bubble could be repeated.”[25]
In June of 2009, Hedge Fund manager Michael Masters told the US Senate that, “Congress has not done enough to curb excessive speculation in the oil markets, leaving the country vulnerable to another price run-up in 2009.” He explained that, “oil prices are largely not determined by supply and demand but the trading desks of large Wall Street firms.” Because “Nothing was actually done by Congress to put an end to the problem of excessive speculation” in 2008, Masters explained, “there is nothing to prevent another bubble in oil prices in 2009. In fact, signs of another possible bubble are already beginning to appear.”[26]
In May of 2008, Goldman Sachs warned that oil could reach as much as $200/barrel within the next 12-24 months [up to May 2010]. Interestingly, “Goldman Sachs is one of the largest Wall Street investment banks trading oil and it could profit from an increase in prices.”[27] However, this is missing the key point. Not only would Goldman Sachs profit, but Goldman Sachs plays a major role in sending oil prices up in the first place.
As Ed Wallace pointed out in an article in Business Week in May of 2008, Goldman Sachs’ report placed the blame for such price hikes on “soaring demand” from China and the Middle East, combined with the contention that the Middle East has or would soon peak in its oil reserves. Wallace pointed out that:
Goldman Sachs was one of the founding partners of online commodities and futures marketplace Intercontinental Exchange (ICE). And ICE has been a primary focus of recent congressional investigations; it was named both in the Senate’s Permanent Subcommittee on Investigations’ June 27, 2006, Staff Report and in the House Committee on Energy & Commerce’s hearing last December. Those investigations looked into the unregulated trading in energy futures, and both concluded that energy prices’ climb to stratospheric heights has been driven by the billions of dollars’ worth of oil and natural gas futures contracts being placed on the ICE—which is not regulated by the Commodities Futures Trading Commission.[28]
Essentially, Goldman Sachs is one of the key speculators in the oil market, and thus, plays a major role in driving oil prices up on speculation. This must be reconsidered in light of the resurgent rise in oil prices in 2009. In July of 2009, “Goldman Sachs Group Inc. posted record earnings as revenue from trading and stock underwriting reached all-time highs less than a year after the firm took $10 billion in U.S. rescue funds.”[29] Could one be related to the other?
Bailouts Used in Speculation
In November of 2008, the Chinese government injected an “$849 billion stimulus package aimed at keeping the emerging economic superpower growing.”[30] China then recorded a rebound in the growth rate of the economy, and underwent a stock market boom. However, as the Wall Street Journal pointed out in July of 2009, “Its growth is now fuelled by cheap debt rather than corporate profits and retained earnings, and this shift in the medium term threatens to undermine China’s economic decoupling from the global slump.” Further, “overseas money has been piling into China, inflating foreign exchange reserves and domestic liquidity. So perhaps it is not surprising that outstanding bank loans have doubled in the last few years, or that there is much talk of a shadow banking system. Then there is China’s reputation for building overcapacity in its industrial sector, a notoriety it won even before the crash in global demand. This showed a disregard for returns that is always a tell-tale sign of cheap money.”
China’s economy primarily relies upon the United States as a consumption market for its cheap products. However, “The slowdown in U.S. consumption amid a credit crunch has exposed the weaknesses in this export-led financing model. So now China is turning instead to cheap debt for funding, a shift suggested by this year’s 35% or so rise in bank loans.”[31]
In August of 2009, it was reported that China is experiencing a “stimulus-fueled stock market boom.” However, this has caused many leaders to “worry that too much of the $1-trillion lending binge by state banks that paid for China’s nascent revival was diverted into stocks and real estate, raising the danger of a boom and bust cycle and higher inflation less than two years after an earlier stock market bubble burst.”[32]
The same reasoning needs to be applied to the US stock market surge. Something is inherently and structurally wrong with a financial system in which nothing is being produced, 600,000 jobs are lost monthly, and yet, the stock market goes up. Why is the stock market going up?
The Troubled Asset Relief Program (TARP), which provided $700 billion in bank bailouts, started under Bush and expanded under Obama, entails that the US Treasury purchases $700 billion worth of “troubled assets” from banks, and in turn, “that banks cannot be asked to account for their use of taxpayer money.”[33]
So if banks don’t have to account for where the money goes, where did it go? They claim it went back into lending. However, bank lending continues to go down.[34] Stock market speculation is the likely answer. Why else would stocks go up, lending continue downwards, and the bailout money be unaccounted for?
What Does the Bank for International Settlements (BIS) Have to Say?
In late June, the Bank for International Settlements (BIS), the central bank of the world’s central banks, the most prestigious and powerful financial organization in the world, delivered an important warning. It stated that, “fiscal stimulus packages may provide no more than a temporary boost to growth, and be followed by an extended period of economic stagnation.”
The BIS, “The only international body to correctly predict the financial crisis… has warned the biggest risk is that governments might be forced by world bond investors to abandon their stimulus packages, and instead slash spending while lifting taxes and interest rates,” as the annual report of the BIS “has for the past three years been warning of the dangers of a repeat of the depression.” Further, “Its latest annual report warned that countries such as Australia faced the possibility of a run on the currency, which would force interest rates to rise.” The BIS warned that, “a temporary respite may make it more difficult for authorities to take the actions that are necessary, if unpopular, to restore the health of the financial system, and may thus ultimately prolong the period of slow growth.”
Of immense import is the BIS warning that, “At the same time, government guarantees and asset insurance have exposed taxpayers to potentially large losses,” and explaining how fiscal packages posed significant risks, it said that, “There is a danger that fiscal policy-makers will exhaust their debt capacity before finishing the costly job of repairing the financial system,” and that, “There is the definite possibility that stimulus programs will drive up real interest rates and inflation expectations.” Inflation “would intensify as the downturn abated,” and the BIS “expressed doubt about the bank rescue package adopted in the US.”[35]
The BIS further warned of inflation, saying that, “The big and justifiable worry is that, before it can be reversed, the dramatic easing in monetary policy will translate into growth in the broader monetary and credit aggregates,” the BIS said. That will “lead to inflation that feeds inflation expectations or it may fuel yet another asset-price bubble, sowing the seeds of the next financial boom-bust cycle.”[36]
Major investors have also been warning about the dangers of inflation. Legendary investor Jim Rogers has warned of “a massive inflation holocaust.”[37] Investor Marc Faber has warned that, “The U.S. economy will enter ‘hyperinflation’ approaching the levels in Zimbabwe,” and he stated that he is “100 percent sure that the U.S. will go into hyperinflation.” Further, “The problem with government debt growing so much is that when the time will come and the Fed should increase interest rates, they will be very reluctant to do so and so inflation will start to accelerate.”[38]
Are We Entering A New Great Depression?
In 2007, it was reported that, “The Bank for International Settlements, the world’s most prestigious financial body, has warned that years of loose monetary policy has fuelled a dangerous credit bubble, leaving the global economy more vulnerable to another 1930s-style slump than generally understood.” Further:
The BIS, the ultimate bank of central bankers, pointed to a confluence a worrying signs, citing mass issuance of new-fangled credit instruments, soaring levels of household debt, extreme appetite for risk shown by investors, and entrenched imbalances in the world currency system.
[...] In a thinly-veiled rebuke to the US Federal Reserve, the BIS said central banks were starting to doubt the wisdom of letting asset bubbles build up on the assumption that they could safely be “cleaned up” afterwards – which was more or less the strategy pursued by former Fed chief Alan Greenspan after the dotcom bust.[39]
In 2008, the BIS again warned of the potential of another Great Depression, as “complex credit instruments, a strong appetite for risk, rising levels of household debt and long-term imbalances in the world currency system, all form part of the loose monetarist policy that could result in another Great Depression.”[40]
In 2008, the BIS also said that, “The current market turmoil is without precedent in the postwar period. With a significant risk of recession in the US, compounded by sharply rising inflation in many countries, fears are building that the global economy might be at some kind of tipping point,” and that all central banks have done “has been to put off the day of reckoning.”[41]
In late June of 2009, the BIS reported that as a result of stimulus packages, it has only seen “limited progress” and that, “the prospects for growth are at risk,” and further “stimulus measures won’t be able to gain traction, and may only lead to a temporary pickup in growth.” Ultimately, “A fleeting recovery could well make matters worse.”[42]
The BIS has said, in softened language, that the stimulus packages are ultimately going to cause more damage than they prevented, simply delaying the inevitable and making the inevitable that much worse. Given the previous BIS warnings of a Great Depression, the stimulus packages around the world have simply delayed the coming depression, and by adding significant numbers to the massive debt bubbles of the world’s nations, will ultimately make the depression worse than had governments not injected massive amounts of money into the economy.
After the last Great Depression, Keynesian economists emerged victorious in proposing that a nation must spend its way out of crisis. This time around, they will be proven wrong. The world is a very different place now. Loose credit, easy spending and massive debt is what has led the world to the current economic crisis, spending is not the way out. The world has been functioning on a debt based global economy. This debt based monetary system, controlled and operated by the global central banking system, of which the apex is the Bank for International Settlements, is unsustainable. This is the real bubble, the debt bubble. When it bursts, and it will burst, the world will enter into the Greatest Depression in world history.
Notes
[1] Barrie McKenna, End of housing slump? Try telling that to buyers, sellers and the unemployed. The Globe and Mail: August 6, 2009:
http://www.theglobeandmail.com/report-on-business/end-of-housing-slump-try-telling-that-to-buyers-sellers-and-the-unemployed/article1240418/
[2] Gene Sperling, Double-Bubble Trouble in Commercial Real Estate: Gene Sperling. Bloomberg: May 9, 2009:
http://www.bloomberg.com/apps/news?pid=20601110&sid=a.X91SkgOd8g
[3] AL Sull, Commercial Real Estate – The Other Real Estate Bubble. Financial Post: July 23, 2009:
http://network.nationalpost.com/np/blogs/fpmagazinedaily/archive/2009/07/23/commercial-real-estate-the-other-real-estate-bubble.aspx
[4] Hui-yong Yu, U.S. Office Vacancies Rise to Three-Year High, Cushman Says. Bloomberg: April 16, 2009:
http://www.bloomberg.com/apps/news?pid=20601087&sid=aegH6dXG8H8U
[5] Parija B. Kavilanz, Malls shedding stores at record pace. CNN Money: April 14, 2009:
http://money.cnn.com/2009/04/10/news/economy/retail_malls/index.htm
[6] Ilaina Jonas and Emily Chasan, General Growth files largest U.S. real estate bankruptcy. Reuters: April 16, 2009:
http://www.reuters.com/article/businessNews/idUSTRE53F68P20090417
[7] Jamil Anderlini, China property prices ‘likely to halve’. The Financial Times: April 13, 2009:
http://www.ft.com/cms/s/0/9a36b342-280e-11de-8dbf-00144feabdc0.html
[8] Reuters, Fed Might Extend TALF Support to Five Years. Money News: April 17, 2009:
http://moneynews.newsmax.com/financenews/talf/2009/04/17/204120.html?utm_medium=RSS
[9] Francesco Guerrera and Greg Farrell, US banks warn on commercial property. The Financial Times: July 22, 2009:
http://www.ft.com/cms/s/0/3a1e9d86-76eb-11de-b23c-00144feabdc0.html
[10] Mark Pittman and Bob Ivry, Financial Rescue Nears GDP as Pledges Top $12.8 Trillion. Bloomberg: March 31, 2009:
http://www.bloomberg.com/apps/news?pid=20601087&sid=armOzfkwtCA4
[11] Gerald Celente, The “Bailout Bubble” – The Bubble to End All Bubbles. Trends Research Institute: May 13, 2009:
http://geraldcelentechannel.blogspot.com/2009/05/gerald-celente-bubble-to-end-all.html
[12] Tom Braithwaite, Treasury clashes with Tarp watchdog on data. The Financial Times: July 20, 2009:
http://www.ft.com/cms/s/0/ab533a38-757a-11de-9ed5-00144feabdc0.html
[13] AFP, US could spend 23.7 trillion dollars on crisis: report. Agence-France Presse: July 20, 2009:
http://www.google.com/hostednews/afp/article/ALeqM5iuL1HParBuO4WyHJIxw6rlOKdz-A
[14] John Whitesides, Warren Buffett says second stimulus might be needed. Reuters: July 9, 2009:
http://www.reuters.com/article/pressReleasesMolt/idUSTRE5683MZ20090709
[15] Vidya Ranganathan, U.S. should plan 2nd fiscal stimulus: economic adviser. Reuters: July 7, 2009:
http://www.reuters.com/article/newsOne/idUSTRE56611D20090707
[16] Carly Crawford, US may increase stimulus payments to rein in unemployment. The Herald Sun: August 3, 2009:
http://www.news.com.au/heraldsun/story/0,21985,25873672-664,00.html
[17] David Cho and Binyamin Appelbaum, Treasury Works on ‘Plan C’ To Fend Off Lingering Threats. The Washington Post: July 8, 2009:
http://www.washingtonpost.com/wp-dyn/content/article/2009/07/07/AR2009070702631.html?hpid=topnews
[18] Charles Bremner and David Charter, Germany and France lead €1 trillion European bailout. Times Online: October 13, 2009:
http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article4937516.ece
[19] Douwe Miedema, Europe banks silent on reported AIG bailout gains. Reuters: March 8, 2009:
http://www.reuters.com/article/topNews/idUSTRE5270YD20090308
[20] Elitsa Vucheva, European Bank Bailout Total: $4 Trillion. Business Week: April 10, 2009:
http://www.businessweek.com/globalbiz/content/apr2009/gb20090410_254738.htm?chan=globalbiz_europe+index+page_top+stories
[21] Bruno Waterfield, European bank bail-out could push EU into crisis. The Telegraph: February 11, 2009:
http://www.telegraph.co.uk/finance/financetopics/financialcrisis/4590512/European-banks-may-need-16.3-trillion-bail-out-EC-dcoument-warns.html
[22] Ian Traynor, EU doubles funding for fragile eastern European economies. The Guardian: March 20, 2009:
http://www.guardian.co.uk/world/2009/mar/20/eu-imf-emergency-funding
[23] Anatole Kaletsky, The great bailout – Europe’s best-kept secret. The Times Online: June 4, 2009:
http://www.timesonline.co.uk/tol/comment/columnists/anatole_kaletsky/article6426565.ece
[24] Gideon Rachman, Europe prepares for a Baltic blast. The Financial Times: August 3, 2009:
http://www.ft.com/cms/s/0/b497f5b6-8060-11de-bf04-00144feabdc0.html
[25] JAD MOUAWAD, Swings in Price of Oil Hobble Forecasting. The New York Times: July 5, 2009:
http://www.nytimes.com/2009/07/06/business/06oil.html
[26] Christopher Doering, Masters says signs of oil bubble starting to appear. Reuters: June 4, 2009:
http://www.reuters.com/article/Inspiration/idUSTRE55355620090604
[27] Javier Blas and Chris Flood, Analyst warns of oil at $200 a barrel. The Financial Times: May 6, 2008:
http://us.ft.com/ftgateway/superpage.ft?news_id=fto050620081414392593
[28] Ed Wallace, The Reason for High Oil Prices. Business Week: May 13, 2009:
http://www.businessweek.com/lifestyle/content/may2008/bw20080513_720178.htm
[29] Christine Harper, Goldman Sachs Posts Record Profit, Beating Estimates. Bloomberg: July 14, 2009:
http://www.bloomberg.com/apps/news?pid=20601087&sid=a2jo3RK2_Aps
[30] Peter Martin and John Garnaut, The great China bailout. The Age: November 11, 2008:
http://business.theage.com.au/business/the-great-china-bailout-20081110-5lpe.html
[31] Paul Cavey, Now China Has a Credit Boom. The Wall Street Journal: July 30, 2009:
http://online.wsj.com/article/SB10001424052970204619004574319261337617196.html
[32] Joe McDonald, China’s stimulus-fueled stock boom alarms Beijing. The Globe and Mail: August 2, 2009:
http://www.globeinvestor.com/servlet/story/RTGAM.20090802.wchina02/GIStory/
[33] Matt Jaffe, Watchdog Refutes Treasury Claim Banks Cannot Be Asked to Account for Bailout Cash. ABC News: July 19, 2009:
http://abcnews.go.com/Business/Politics/story?id=8121045&page=1
[34] The China Post, Bank lending slows down in U.S.: report. The China Post: July 28, 2009:
http://www.chinapost.com.tw/business/americas/2009/07/28/218141/Bank-lending.htm
[35] David Uren. Bank for International Settlements warning over stimulus benefits. The Australian: June 30, 2009:
http://www.theaustralian.news.com.au/story/0,,25710566-601,00.html
[36] Simone Meier, BIS Sees Risk Central Banks Will Raise Interest Rates Too Late. Bloomberg: June 29, 2009:
http://www.bloomberg.com/apps/news?pid=20601068&sid=aOnSy9jXFKaY
[37] CNBC.com, We Are Facing an ‘Inflation Holocaust’: Jim Rogers. CNBC: October 10, 2008:
http://www.cnbc.com/id/27097823
[38] Chen Shiyin and Bernard Lo, U.S. Inflation to Approach Zimbabwe Level, Faber Says. Bloomberg: May 27, 2009:
http://www.bloomberg.com/apps/news?pid=20601110&sid=avgZDYM6mTFA
[39] Ambrose Evans-Pritchard, BIS warns of Great Depression dangers from credit spree. The Telegraph: June 27, 2009:
http://www.telegraph.co.uk/finance/economics/2811081/BIS-warns-of-Great-Depression-dangers-from-credit-spree.html
[40] Gill Montia, Central bank body warns of Great Depression. Banking Times: June 9, 2008:
http://www.bankingtimes.co.uk/09062008-central-bank-body-warns-of-great-depression/
[41] Ambrose Evans-Pritchard, BIS slams central banks, warns of worse crunch to come. The Telegraph: June 30, 2008:
http://www.telegraph.co.uk/finance/markets/2792450/BIS-slams-central-banks-warns-of-worse-crunch-to-come.html
[42] HEATHER SCOFFIELD, Financial repairs must continue: central banks. The Globe and Mail: June 29, 2009:
http://v1.theglobeandmail.com/servlet/story/RTGAM.20090629.wcentralbanks0629/BNStory/HEATHER+SCOFFIELD/
Andrew Gavin Marshall is a Research Associate with the Centre for Research on Globalization (CRG). He is currently studying Political Economy and History at Simon Fraser University.
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