The Collapse of Nations All By The Hand Of Corrupt Bankers

by Robert Chapman
International Forecaster
June 18th, 2011

As far as we can discern the US Treasury thus far has spent and borrowed about $100 billion from the federal pension accounts. Unless there is a vote on the cash debt extension prior to August 2nd, government will probably have borrowed some $250 billion to $300 billion. The Treasury is paying virtually no interest on this debt. Three-month Treasury bills are currently yielding zero percent. Our question is how will the funds be generated to fulfill the Treasury’s obligation to the pension fund? What happens if on August 2nd if legislation is not passed? Does this go on forever? We will keep you apprised on new developments.

The current situation regarding the state of recovery in the US has turned from precarious to dismal and as we predicted a year ago May we will have to be treated to QE3 something no one really wants, but as we said before it is inevitable. The Fed and their controllers, the member bank owners of the Fed, know the present approach doesn’t work and it is only a matter of time, as a result of their policies, when more stimulus will be needed, which in turn leads to more inflation.

Due to the current state of affairs Fed Chairman Bernanke has been making one appearance on TV after another. He gets grilled over and over again and he doesn’t like the public reception at all.

It should be firmly implanted in your mind that your masters in government and those controlling government brazenly and arrogantly believe that they know better what is good for you, than you do. That is why when they speak to you their answers are dripping with condescension – as if to say, how dare you question what we tell you. Fed Chairman, Mr. Bernanke, is a perfect example of this. He, others and his predecessors have created a false economy based upon perpetual debt and upon money and credit being created out of thin air. Today that is accompanied with zero interest rates, a combination that in time can only bring a falling dollar, inflation and a collapsing economy. Mr. Bernanke appears to believe that an increased supply of money has little or no effect on the comparison between money and the prices of goods. He has to be living in a fairy tale land. Thinking such as this can only end up making a bad economic situation worse.

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Russia will continue to lower its U.S. Holdings

WSJ
June 20, 2011

Russia will likely continue lowering its U.S. debt holdings as Washington struggles to contain a budget deficit and bolster a tepid economic recovery, a top aide to President Dmitry Medvedev said Saturday.

“The share of our portfolio in U.S. instruments has gone down and probably will go down further,” said Arkady Dvorkovich, chief economic aide to the president, told Dow Jones in an interview on the sidelines of the St. Petersburg International Economic Forum.

Russian holdings of U.S. Treasury securities fell to $125.4 billion in April 2011 from $176.3 billion in October 2010, Treasury Department data showed.

Asked if U.S. debt was as solid an investment now as it was 10 years ago, Mr. Dvorkovich said: “On an absolute basis, yes. On a relative basis, compared to other investments, of course not.”

“When we take decisions and compare, we’re not thinking in absolute terms,” he said.

Russia’s financial reserves—which stood at $528 billion as of June 10—are the world’s third largest, after China and Japan’s. As of May, according to Russia’s central bank, 47% of reserves were in dollars and 41% in euros, compared with 45.2% in dollars and 43.1% in euros on Jan. 1.

The central bank recently diversified the stash to include the Canadian dollar, which makes up 1% of the total, and plans to put 0.8% into the Australian dollar starting in September.

Working for them: Obama takes in another Corporatist

The Administration that promised to end corporate management of the government is now fully loaded with Wall Street and corporation insiders to manage what “The Man” cannot.

NationalJournal.com
January 21, 2011

President Obama today will name General Electric CEO Jeff Immelt chairman of the new Council on Jobs and Competitiveness, the White House announced overnight.

Corporate Control of Government

President Obama selected Jeffrey Immelt, chairman and CEO of General Electric, for his Council on Jobs and Competitiveness, to replace 'old dog' Paul Volcker.

The Jobs and Competitiveness Council’s establishment signals that the president believes the economic recovery has entered a new, more productive phase. It will advise the president on job creation policies and on the establishment of a long-term growth strategy. Its composition was not immediately available.

The creation of the new entity coincides with the early February dissolution of the President’s Economic Recovery Advisory Board (PERAB), which was tasked principally with fixing the financial markets and restoring the American economy to equilibrium. Tonight, the administration formally announced the resignation of PERAB Chairman Paul Volcker. Immelt was one of 17 members of the board.

“Because we still have a long way to go to get Americans back to work and strengthen our economy,” the White House announced in a 12:30 am EST statement, “the council will focus on finding new ways to promote growth by investing in American business to encourage hiring, to educate and train our workers to compete globally, and to attract the best jobs and businesses to the United States.”

“Over the past two years, my Economic Recovery Advisory Board has provided this administration with support and expertise as we worked to bring our economy back from the brink and start recovering from an economic crisis that cost millions of American jobs,” Obama is quoted as saying in the statement. “We still have a long way to go, and my number one priority is to ensure we are doing everything we can to get the American people back to work. As we enter a new phase in our recovery, I have asked the new Council to focus its work on finding new ways to encourage the private sector to hire and invest in American competitiveness.”

Immelt, GE’s CEO since September 2001, met with the president earlier this week and attended Wednesday’s state dinner with Chinese President Hu Jintao. He will guide the president on a tour of GE headquarters in Schenectady, N.Y., today. Immelt, a Republican, donated to both Hillary Rodham Clinton and John McCain during the last presidential cycle, but not President Obama, according to Bloomberg.

In the statement, Obama thanks Volcker, a revered former Federal Reserve Board chairman, and says that he intends to call on Volcker’s counsel in the future. The White House and Volcker have said that Volcker’s decision to step down was his own, although the emphasis on the board’s sunset date suggests that the decision was driven by the White House’s intention not to extend the PERAB’s mandate. Obama has accepted some of Volcker’s suggestions, like a major restriction on how banks can speculate with their money.

During his State of the Union address Tuesday, Obama is expected to outline a competitiveness agenda and specify the steps needed to fulfill several promises about the pace and quality of job creation.

G20 Nations Slam Quantitative Easing

Emerging nations also take measures to avoid currency valuation against the purposely concocted fall of the dollar.

Reuters

U.S. President Barack Obama defended the Federal Reserve’s policy of printing dollars on Monday after China and Russia stepped up criticism ahead of this week’s Group of 20 meeting.

The G20 summit has been pitched as a chance for leaders of the countries that account for 85 percent of world output to prevent a currency row escalating into a rush to protectionism that could imperil the global recovery.

But there is little sign of consensus.

The summit has been overshadowed by disagreements over the U.S. Federal Reserve’s quantitative easing (QE) policy under which it will print money to buy $600 billion of government bonds, a move that could depress the dollar and cause a potentially destabilising flow of money into emerging economies.

“I will say that the Fed’s mandate, my mandate, is to grow our economy. And that’s not just good for the United States, that’s good for the world as a whole,” Obama said during a trip to India.

“And the worst thing that could happen to the world economy, not just ours, is if we end up being stuck with no growth or very limited growth,” he said.

European Central Bank President Jean-Claude Trichet said all participants at a meeting of the world’s central bankers in Basel, Switzerland had insisted they were not pursuing weak currency policies.

“We’re attached to avoiding excessive volatility. It’s very counterproductive for global growth and global stability,” he told a news conference.

Washington has frequently criticised China, saying it deliberately undervalues its currency to boost exports.

China says the United States, via the Fed, is engaged in the same thing that it stands accused of, and some emerging nations have already acted to curb their currencies’ rise.

Resentment abroad stems from worry that Fed pump-priming will hasten the U.S. dollar’s slide and cause their currencies to shoot up in value, setting the stage for asset bubbles and making a future burst of inflation more likely.

“As a major reserve currency issuer, for the United States to launch a second round of quantitative easing at this time, we feel that it did not recognise its responsibility to stabilise global markets and did not think about the impact of excessive liquidity on emerging markets,”  Chinese Finance Vice Minister Zhu Guangyao said on Monday.

The Fed’s quantitative easing policy was unveiled last week to jeers from emerging market powerhouses from Latin America to Asia. Russia renewed its assault on Monday.

“Russia’s president will insist …. that such actions are taken with preliminary consultations with other members of the global economy,” said Arkady Dvorkovich, a Russian official who is preparing the country’s position in Seoul.

Bank of Japan Deputy Governor Hirohide Yamaguchi said on Monday that it too was ready to boost its asset-buying scheme if it saw clear signs of a downturn. Worth 5 trillion yen ($62 billion), it is so far just a tenth the size of the Fed’s.

U.S. DROPS KEY DEMAND

India is Obama’s first stop in a 10-day trip to Asia that will include Indonesia and Japan.

He will arrive in Seoul for the Nov. 11-12 summit weakened by a crushing congressional election defeat for his Democratic Party and under fire from all sides. Germany described U.S. economic policy as “clueless” last week.

The U.S. has already all but dropped its centrepiece proposal for the G20 — a measure that would cap current account balances at 4 percent of gross domestic product, something economists said was clearly aimed at China.

At the weekend, U.S. Treasury Secretary Timothy Geithner backed away from the numerical target that had been rejected by China, Germany, Japan and others in a sign that global financial power had slipped from U.S. hands.

On Monday, he was putting on a brave face, saying China was supportive of the G20’s framework for rebalancing the global economy, and that he expected broad consensus on it at the summit.

The risk of a negative outcome in Seoul appears to be increasing, or at the very least, an agreement that merely papers over the huge gaps and allows countries to pursue their own economic policies whether it be intervening in currency markets like South Korea and Japan or printing dollars.

“Judging by the critical response of emerging market governments to QE, the likelihood of a ceasefire in the currency war is slim,” RBC Capital markets said in a report published on Monday.

The Economic Recovery Is Moving Along Quite Well – For The Boys Down On Wall Street

TheEconomicCollapseBlog.com

If you are part of the Wall Street establishment, the economic recovery is moving along quite well.  Many of the biggest firms on Megabanks controlling it allWall Street just handed out record-setting bonuses, the Stock Market has been moving up steadily and the DOW is back up to around 11,000.  Profits at the top banks have been quite impressive lately.  Bank of America, JPMorgan Chase, Citigroup and Wells Fargo combined for first quarter profits of $13.4 billion – the most in almost three years.  Yes, life is quite good down on Wall Street these days.  People are still buying fast cars, big yachts and homes in the Hamptons.  It is almost as if “the greatest financial crisis since the Great Depression” didn’t even happen.  Things are quickly getting back to “normal” for the banking elite and to many it seems like there are a lot more smiles down on Wall Street than there have been in a long, long time.

Bank of America’s chief executive officer, Brian T. Moynihan, is being quoted by Reuters as saying that “the worst of the credit cycle is clearly behind us” and that the economic growth we are experiencing is “real”.

JPMorgan CEO Jamie Dimon is quoted as saying that the U.S. economy may be poised for “a strong recovery”.

And why wouldn’t they say these things?  Profits are up.  Their stock portfolios are up.  They are getting record bonuses.  They know that if anything does go wrong again that their friends in Washington D.C. will bail them out because they are “too big to fail”.

But for tens of millions of other Americans, the economy seems like it is getting worse than ever.  It is hard to explain the gut-wrenching agony that many highly-educated and highly-qualified American workers are going through as they send out hundreds of resumes only to get no response.  Or the absolute frustration of only being able to get a very low paying retail job and realizing that it will not even be able to pay the mortgage – much less support an entire family.  Or the soul-crushing despair of working two or three jobs and still not being able to pay the bills at the end of the month.

But these are the daily realities that millions of Americans must face now.  The truth is that there are not nearly enough jobs for everyone.  The number of unemployed Americans per job opening hit 5.5 in February.  It is like we are all caught in some bizarre game of musical chairs, and the losers end up destitute and out in the street.

Even many of those who can get jobs find themselves in bad situations.  Gallup’s underemployment measure hit 20.0% on March 15th.  That was up from 19.7% two weeks earlier and 19.5% at the start of the year.  A lot of very educated, very qualified people find themselves slaving away at jobs that high school students are qualified for.

But the ones being hurt the worst by this unemployment epidemic are the poor.  Check out the following chart.  At the end of 2009, the unemployment rate for those at the top end of the income scale in the United States was about 3%.  For those at the bottom of the income scale, the unemployment rate was about 30%….

It isn’t the boys down on Wall Street that are losing their homes and their jobs.

No, they are “too big to fail”.

It is millions of ordinary Americans that are losing their homes and their jobs.

And things keep getting worse.

According to RealtyTrac, foreclosure filings were reported on 367,056 properties in the month of March.  This was an increase of almost 19 percent from February, and it was the highest monthly total since RealtyTrac began issuing its report in January 2005.

Not only that, but RealtyTrac projects that there will be a total of 4.5 million home foreclosures by the end 2010.  If you figure that there are approximately 4 people per household, that is another 18 million people that will be facing the pain of a foreclosure filing.

For many Americans, losing their home to foreclosure is just too much.  For example, one man in Ohio actually decided to bulldoze his own home rather than let the bank take it in foreclosure proceedings.

Because of the extreme economic conditions, millions of Americans are in severe pain and are becoming increasingly desperate.  In some of the most depressed areas, crime is absolutely spiraling out of control.  So far this year in Detroit, car thefts are up 83%, robberies are up 50%, burglaries are up 20% and property destruction is up 42%.

Adding to all of this economic despair is the fact that food and gas prices are starting to shoot up.

In some areas of the United States, people are already paying as much as $3.50 for a gallon of gasoline, and many experts are now predicting that gasoline could hit $4.00 a gallon by the end of 2010.

Not only that, but wholesale food prices rose 2.4% in March, matching the biggest gain in 26 years.

So while the economic recovery is buzzing along quite well down on Wall Street, the reality is that for millions of other Americans things are really hard.  In fact, not even the smaller banks are experiencing much of a recovery.  The FDIC’s list of problem banks just hit a 17-year high.

No, the main beneficiaries of this “economic recovery” are the boys over on Wall Street.  They should enjoy it while it lasts, because even harder economic times are on the way, and the reality is that none of us will be able to completely escape the economic pain that is coming.

The Banking Oligarchy That Controls Assets Equivalent To 60 Percent Of America’s GNP

Today financial power is being concentrated in the hands of fewer and fewer individuals.  In fact, the six biggest banks in the United States now possess assets equivalent to 60 percent of America’s gross national product.  Back in the 1990s that figure was less than 20 percent.  These six banks – Goldman Sachs, Morgan Stanley, JPMorgan Chase, Citigroup, Bank of America, and Wells Fargo – literally dictate what goes on in the U.S. banking industry.  These entities are the poster children for “too big to fail”, and they donate massive amounts of cash to the campaigns of both Republicans and Democrats to ensure that they will continue to receive favorable treatment.  The vast majority of Americans have had a banking account, a credit card and/or a mortgage with one of these institutions at some point.  If they acted in concert, these six banks could literally bring down the U.S. economy overnight if they wanted to.  Together with the Federal Reserve, these six banks represent the real financial power in America.  They are the 800 pound gorilla in the room that influences nearly every major financial deal that gets done and virtually every major political decision that gets made.  As the last couple of years have demonstrated, top politicians from both parties (John McCain and Barack Obama for example) will instantly jump into action and start advocating that the U.S. government spend billions upon billions of dollars when the interests of these behemoths are threatened.  The frightening thing is that the power of these megabanks is growing at a frightening pace.  As dozens upon dozens of smaller U.S. banks are “allowed to fail”, they either go out of existence or the Feds actually encourage these smaller banks to sell themselves to one of the big sharks.  In either event, the banking power in the United States becomes further consolidated in the hands of the megabanks.   More…