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The “Pop” Heard ‘Round the World

30 Nov

Will Somebody Please Turn Off the Bubble Machine? [courtesy Google Images]

Will Somebody Please Turn Off the Bubble Machine?
[courtesy Google Images]

I have no doubt that the cornerstone of the New World Order (N.W.O.) is a debt-based monetary system.  I have no doubt that, if today’s debt-based monetary system were to fail, The Powers That Be would work feverishly to install a second, debt-based monetary system.  If the today’s debt-based monetary system (built on fiat- and/or petro-dollars) failed, the N.W.O. would seek to impose a “new-and-improved” debt-based system that might be built on Special Drawing Rights (SDRs).  These SDRs are nothing more than new debt-instruments issued by the IMF rather than the old debt-instruments currently issued by the Federal Reserve and other central banks.

Despite the N.W.O.’s dependence on debt-based currency, it’s conceivable that, in the chaos that would follow if the current debt-based monetary system failed, the people of the world would “connect the dots,” realize that they’ve been robbed by the current debt-based monetary system and refuse to accept a newer debt-based monetary based on SDRs or some other debt instruments.

In a debt-based monetary system, the fundamental debts that we’re conditioned to value are the “promises to pay” (debt instruments, like bonds) issued primarily by the world’s governments but also by some major corporations.

Those governmental bonds (promises to pay) are used as collateral (assets; payments) by fractional reserve banks to privately issue loans worth 9 to 23 times the bonds’ face values.  Used as fractional-reserve bank collateral, the governments’ bonds can “magically multiply” masses of new currency that will presumably stimulate the world’s economies until everyone is happy—or, at least, everyone thinks they’re happy.

 

•  Most people have heard governments and central banks tell us that the entire monetary and economic system runs on public confidence. That’s old news.  But I don’t recall anyone ever asking “confidence in what?”  Likewise, I don’t recall any government or central bank telling us what, exactly, we must have confidence in.

We all agree that we must have confidence. But, confidence in what?  The Dallas Cowboys?  The Keystone Pipeline?  Change You Can Believe In?

Using sovereign debt (bonds) as collateral to increase the amount of currency needed stimulate the economy is a Ponzi-scheme.  Even so, it’s worked remarkably well for at least four decades.  This scheme will continue to work brilliantly—so long as the people have confidence that their governments can and will redeem their “promises to pay” (bonds) by actually paying the debt owed, in full, on the bonds they’ve issued.

It’s becoming increasingly clear to me that the ultimate confidence that must be maintained is confidence in government’s ability and willingness to repay all of its debts by redeeming all of its bonds.

So long as the world has confidence that the US government can and will repay the official National Debt of $19 trillion, that the Japanese government can and will repay its public debt of 1.3 quadrillion yen, that China can and will repay its $30 trillion total debt, and the EU can and will repay its €12.5 trillion total governmental debts—then, the debt-based monetary system’s Ponzi scheme can continue to flourish and government can continue to “kick the can further down the road”.

Q:  What, incidentally, is in the particular “can” that’s being kicked so enthusiastically?

A: The can contains the evidence and/or express confession that government can’t pay its debts.

Once government is forced to admit (or at least can no longer plausibly deny) that it can’t pay its debts, confidence in US bonds will disappear and the US (and probably global) economy(ies) will probably collapse.

I.e., consider the following hypothetical chain of events:

 

  1. The public realizes that some significant percentage (probably most, maybe all) of the governments’ promises to pay (bonds) can’t and therefore won’t ever actually be paid in full by the government.

2.  The public loses some or all of the fundamental confidence in governments’ ability to pay its debts;

3.  That lost confidence in governments’ ability to pay their debts would cause the market value of many government bonds to fall;

4.  Much of the perceived market value of bonds used as collateral by banks to justify creating and then lending trillions of dollars’ worth of digital loans would be extinguished;

5.  The loss of market value of bonds held by banks as collateral could cause trillions of dollars’ worth of loans to be called in by the banks;

6.  Calling in trillions of dollars in loans could cause some or all of the existing national and global economies to collapse;

7.  There’d be very little real collateral (physical assets like gold, not paper debt-instruments) remaining for banks to use as collateral to begin to restore lending and rebuilding the collapsed economy; and then,

8.  The perceived value of real, physical assets sufficiently liquid to use as an asset-based money (like gold and silver) could skyrocket. It’s conceivable that people could buy a decent car for one or two ounces of gold and a good house for ten.

 

Note that a chain of events similar to that listed above would be triggered by the loss of public confidence in governments’ ability to pay their debts (bonds).

 

•  What could cause the public to lose confidence in governments’ ability to pay their debts?

Well, a small percentage of people might read articles like this one, consider the arguments presented and, if they agree with those arguments, begin to doubt government’s ability to pay its debts.  If their doubt grows large enough, they’ll dump their paper debt-instruments and convert their wealth, earnings and/or saving into real assets, like gold.

But, the number of people who read, understand and agree with the arguments presented in articles like this one will be relatively few.

The vast majority of people won’t begin to understand, agree with, or try to apply arguments of the sort I’m presenting here until after the “stuff” has clearly begun to hit the fan.

How will the “stuff” begin to hit the fan?

It will begin whenever one or more of the four major economies (US, China, Japan and EU) begin to openly default on their paper debt-instruments (bonds), or fail to pay promised pensions, Social Security, entitlements and subsidies that people have heretofore relied on—or if government causes the currency to hyper-inflate (another means to avoid paying government debts).

In retrospect, future historians might even argue that the “sovereign” debt default began when subordinate governmental entities like Illinois, California, Detroit, Spain, Portugal or Greece began to default on their “sovereign” debts.

 

• This line of conjecture leads us to a central conclusion: It’s not the economy (stupid), or the US Dollar Index (stupid), the price of gold (stupid) or even the stock markets (stupid) that will signal and precipitate doomsday—it’ll be the bond markets.

If bond prices begin to fall significantly in any of the four major economies, that fall will reduce the market value of bonds held as collateral in major banks.  That reduction in market value of the bonds/bank-collateral may cause some significant percentage of outstanding, fractional-reserve loans to be called in.  If enough of those loans are called in, they’ll slow and perhaps collapse the particular national economy. The consequences might topple the entire global economy.

For example, suppose a major American bank held $1 billion in US bonds (mere promises to pay) and had used that $1 billion as collateral to lend $10 billion to private customers.  Suppose the government defaulted on 40% of its bonds.  The bank that had $1 billion in US bonds/collateral in its vaults would then have $600 million—only enough collateral to justify $6 billion of the current $10 billion in loans it had made to private customers.

In theory, the bank would be forced to call in $4 billion worth of current loans.  If it did, investments would fail, businesses would be bankrupted, jobs would be lost, spending would fall.  If something similar happened to enough other banks, the entire economy might sink into overt depression.

 

•  Not all bank loans are based on using government bonds as collateral. Still, insofar as some bank loans are based on government bonds, it’s arguable that the entire, modern debt-based economy starts with government bonds (promises to pay) and depends on maintaining the public’s perceived value of those bonds.  That “perceived value” is a function of public confidence in government’s ability to pay its debts—not just issue more “promises to pay”.

Must a chain of events similar to that outlined above necessarily take place?

Yes.

Why?

Because governments are so deep in debt they can’t possibly repay their existing debts in full.  What can’t be paid, won’t be paid.  Sooner or later, the governments must default.  When they do, the public will awaken, lose confidence in government’s ability to repay its debts, and the price of bonds will fall.

Evidence?

Yes.  The national debt has been growing steadily, almost exponentially, since government established a pure fiat currency in A.D. 1971.  The steady growth of the National Debt is evidence that government hasn’t actually been able to pay all of its debt for, at least, four decades.

We all have moments in our lives when our debts exceed our income.  Your wife is offered a great new job, but you’ll need another car to get her back and forth to the new job.  Billy fell out of a tree and broke his arm.  Sally needs braces.  You go to the bank to borrow enough money to get you through a temporary difficult time.  Then you pay off the loan in full.  The fact that you’re paying the debt on time and in full is evidence that you are solvent and able to pay your debts.

But, suppose that before you were able to repay the car loan, you needed more money to pay for the cast on Billy’s arm.  And then, you needed another loan to pay for Sally’s braces.  As you applied for more and more loans, without having first repaid the pre-existing loans, would the bank begin to doubt your ability to repay any of your loans?

Of course they would.

Same thing with the National Debt.  Because that debt has been constantly growing for most of the past 44 years, we have good reason to doubt the government will ever repay that debt.  That constantly growing debt is evidence that the existing debt can’t be paid.

What is the market value of a US bond if the world knows that the US government can’t pay its debts?

Zee-ro.

 

•  More, the true size (and therefore, true growth) of the National Debt has almost certainly been concealed.

I.e., while the Obama administration claims that the National Debt is roughly $19 trillion, some credible sources (John Williams at Shadowstats.com, economist Laurence Kotlikoff, and the Congressional Budget Office) estimate the true National Debt (including unfunded liabilities) to be at least $100 trillion—and probably over $200 trillion.

If the true National debt is $100 to $200 trillion, anyone who does the math can see that the National Debt will never be repaid in full.

Q.  What is the market value of a $100,000 bond issued by a government that will be lucky to repay 20% of its debt and probably can’t pay even 10%?

A:  Probably somewhere in the neighborhood of $5,000 to $15,000–maybe less.  Maybe nothing at all.

When enough people do the math, public confidence in the government’s ability to pay its debts will fall.  The value of bonds will drop.  The use of bonds as collateral will decline.  Bank loans will presumably be called in.  If enough loans are called in, the economy will be impaired and could collapse.

The whole chain of events starts with a significant loss of public confidence in government’s ability to repay its debts/bonds.  We don’t know when the process will clearly manifest.  However, we do know that process is inevitable for the simple fact that it’s mathematically impossible for the government to repay most of its debts.  Sooner or later everyone will recognize that truth, lose confidence in government’s ability to pay its debts and thereby trigger an economic depression.

 

•  We don’t know when that chain of events may begin, but it’s arguable that it already has.

In September of A.D. 2012, Mother Jones magazine published an article entitled, “Is the Fed Really Buying Three-Quarters of All Treasury Debt?”  In that article, Republican Party candidate for President, Mitt Romney, was quoted as saying,

 

“[T]he former head of Goldman Sachs, John Whitehead, was also the former head of the New York Federal Reserve.  I met with him, and he said as soon as the Fed stops buying all the debt that we’re issuing—which they’ve been doing, the Fed’s buying like three-quarters of the debt that America issues. He said, once that’s over, he said we’re going to have a failed Treasury auction, interest rates are going to have to go up.”

A year to two earlier, I recall reading about a “failed Treasury auction” somewhat similar that which John Whitehead and Mitt Romney had described:  The US Treasury held one of its usual auctions to sell US bonds to private investors—but no one would offer to pay a price close to the bonds’ face value.  So far as I know, that had never happened before.  Previously, the US Treasury had little or no problem selling US Bonds to private investors at or near “full price”.

This time, however, private investors would not purchase US Bonds unless the price was dramatically reduced.  That refusal to buy except at a significantly lower price was evidence that the private investors were losing confidence in the US government’s capacity to pay its debts.  A falling bond price indicated that the public viewed the bonds as increasingly risky and unlikely to be repaid.

The government couldn’t risk allowing the private investors’ market to set a dramatically lower price for US bonds.  The problem was not merely one of price.  The problem was one of public confidence.

If private investors lowered the price of US bonds for sale at that auction, they’d cause the market price for US bonds (held as bank collateral) to fall around the world.  Under fractional reserve banking, a general decline in the price of US bonds could cause banks to call in billions or even trillions of dollars in loans.  The impact on the US and global economies would be negative and might be disastrous.  The real point, I suspect, was that significantly lower bond prices would signal a loss of much of the public confidence required to keep the whole Ponzi Scheme running.

That would truly be a “failed Treasury auction” of historic proportions.

What did the US Treasury do?

Rather than allow evidence to be created on the public record of a “failed Treasury auction,” the Treasury Department closed the auction without selling a single bond.  They prevented even a single sale that would help prove that the free market price for US bonds—and public confidence in government’s ability to pay its bills—had fallen significantly.

That was a “failed Treasury auction” of the sort that John Whitehead and Mitt Romney had described.  However, because Treasury closed the auction rather than allow one sale that would be evidence of that failure, the result was not catastrophic.

Instead, for the next few years, whenever the US Treasury held an “auction,” the Federal Reserve intervened to not only buy most of the US bonds that were being sold, but also to pay “full price” for those bonds.  Figuratively speaking, the Fed was over-paying $900 for a $1,000 US bond in order to conceal the fact that the private investors’ markets might not pay even $700 for the same bond.

Treasury auctions were, in fact, failing.  The free market price of US bonds was falling.  But the Fed concealed evidence of that failure by paying more than the free-market price.  Thanks to the Fed, Treasury auctions looked like “business as usual” and US bonds appeared to retain their value.

By buying US bonds and paying “full price,” the Federal Reserve maintained the illusion of steady value in US bonds.  So long as that illusion of value (redeemability) remained, the public retained confidence that the government could repay its debts in full.  Unfortunately, that confidence is unfounded since it’s based on the Fed’s manipulation of the bond markets rather than honest, free-market prices for bonds.

 

•  Thanks to Fed’s intervention in the sale of US bonds:

 

1) US bonds are overpriced to an unknown but significant degree; and,

2) the bond market has become a massive “bubble”—maybe the mother of all bubbles.

 

If the bond market bubble “pops,” it’ll be the “pop heard round the world”.

Why?  Because, as I’ve illustrated in this article, bonds in general and US bonds in particular, may the cornerstone on which much of the US and global economies are based.  If the US bond market “pops,” the price of US bonds could easily fall by 20%–and could fall by 80% or even 90%.  In the event of a “pop,” every pension fund holding US bonds would see its capital reduced.  Every retiree whose income relies on bonds would see their income reduced.  Every investor who’s stored his wealth in US bonds could lose much of his wealth.  Banks that rely on US bonds for collateral might be forced to call in enough loans to tip an already fragile economy into an overt depression.

Given the seeming significance of US bond prices holding fairly steady, you can see why the Federal Reserve is so skittish about raising interest rates by a mere 0.25%.  Fundamental rule:  If interest rates rise, bond prices fall.  Would a 0.25% rise in interest rates cause enough of a fall in US bond prices to “pop” the bubble?  Probably not.

But who can say for sure?  In an economy as fragile as ours, a 0.25% rise in interest rates might be just the needle needed to cause the “pop heard round the world”.

 

•  Lesson?

If we want reliable evidence as to what’s happened, happening or about to happen to the US or global economies and markets, we’d best start following the bond markets.

 

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18 responses to “The “Pop” Heard ‘Round the World

  1. BMan

    November 30, 2015 at 6:10 AM

    How does the Dollar as reserve currency affect this scenario?

    I have long contended that if and when the world adopts whatever debt-based reserve currency they have in mind for us (coinciding with the dollar’s demise), we will quickly see this bill collector show up, but he knows it can’t be paid.

    That leaves but the military to fend off the collector (and that will only work for a while).

    I think this is when hell arrives at our doorstep. Your thoughts?

     
    • Chris

      November 30, 2015 at 10:58 AM

      All good points as always, Al. Going along further with this line of thinking and other current events, something came to me last night about “gun control”, the Second Amendment, and liberals being puppeteered by the NWO.

      1. Public belief is that liberals are going to either install patsy justices in the supreme court and overturn the Second Amendment by legislating from the bench, since they obviously can’t get this passed through Congress. Or, Obama or his replacement will attempt to bypass Congress by signing the UN gun ban treaty like other “advanced” countries have (note complete sarcasm here, see crime results since Australia and UK have disarmed their peoples).
      As a result, gun sales over the past 6 years have been through the roof here in the united States, being good for gun businesses (and resulting tax receipts).
      2. I see two ways for this to play out… either the government is going to use this to essentially “upgrade” the government’s inventory of guns and other weapons by a mass confiscation, thereby removing any instruments of resistance, and essentially breaking the financial backs of the country as well- many people have invested many thousands of dollars in weapons for collecting and protection.
      3. Mode 2: When the SHTF from the currency crisis or any other “created” crisis, the government ISN’T going to respond with the National Guard and the armed forces- they are going to let We the People fend for ourselves in the wake of their disaster. They will keep all military installations on high alert and locked down, since they will likely be the only places with any real amounts of food or water (outside of the FEMA concentration camps that you’ll be welcome to join, or die). Everyone else with guns will then be forced to defend their own life, liberty, and property against those who haven’t planned and are reliant on the government. The government will then be able to have a “clean conscience” because any deaths that occur during this time were obviously caused by crazed gun owners gone wild. This part will play into their goal of population control and reduction as well.
      4. After this is allowed to run some of its course, I could see the government then mobilizing the armed forces and National Guard to reel in these “outlaws” who have defended their families and property, taking a ‘dead or alive’ approach to then confiscating their guns in the name of ‘public policy’. By now, everyone who had guns are either disarmed or dead, and the then are hoarded into the FEMA camps with the already submissive.
      5. Now that everyone is rounded up, and the government says they are “out of resources”, it’s only a matter of time before they start up a full-on eugnenics program, ala National Socialist style. Those who aren’t extremely wealthy, “contributors” to the society are at the top of the list for “social engineering”. Invalids and old people are right there, as already shown in Obamacare. Those deemed not worthy are then sterilized or eliminated. It’s only a matter of time.

      Everyone needs to wake up. It’s already been proven over and over that the NWO and liberals are doing everything they can to bring about the End Times documented in the Book of Revelations- crisis or not, the mark of the Beast will certainly come in the next 10 years in the “cashless societies” they are planning. I feel we’re very rapidly approaching a point of no return, where if we don’t start eliminating these things from our minds and our cultures, you might as well give up now. My advice, and my actions: Stock up on supplies and protection devices, have someplace off the grid to go when the SHTF, and get yourself right with God. This world and the things that happen in it is only temporary (thank God). I’m not an alarmist, but NOW is the time to raise your voice!

      Thank you, Al, for standing up and speaking out about the schemes and machinations of the NWO.

       
      • Adask

        November 30, 2015 at 11:39 AM

        Thanks for reading my article. Thanks for your compliments. And thanks for your extensive reply. Whatever is going on, we definitely live in “interesting times”.

         
  2. gary

    November 30, 2015 at 10:52 AM

    GovCo may believe it only has to buy a little more time, say4-6 months, before the little brown dwarf twin star system (mini-solar system) to our sun does its usual 3600 lunar year fly-by (for you bible types, think Noah’s flood, Exodus, etc), and apparently, GovCo may more than aware that this particular fly-by is most likely a worst-case scenario.

    GovCo has been preparing D.U.M.B.s (deep underground military bases) under Project Camelot for well over 50 years, in preparation for this particular event (and, no, this one is NOT a ‘false flag event), and the military/’GovCo and certain self-proclaimed ‘elite’ will be disappearing underground, leaving the majority of the population of the planet to deal with what may be rather cataclysmic consequences (look up Project Camelot and you can see where all those missing Pentagon multi trillions of ‘dollars’ were actually spent)……again, all you bible folks have read about these fly-by events before…..

    GovCo won’t have to worry about ‘repaying the debt’, as the events within the next 6 months, or so,may slightly overshadow the relatively insignificant national debt issues, as well as pretty much wipe out most evidence of such on the surface, …..try researching Robert Stitchen, head astronomer of the US Naval Observatory, Robert Shafsky, Marshal Masters (MIT, ex-head of CNN Science programming, current researcher on the Nemesis mini-solar system)..

    Of course there will those who say this is total bunk, BS, etc, and that is okay…nice thing about a ;free’ country is the right to one’s opinion…..however, if you want to see why possibly, just possibly, GovCo is NOT worried about the financial ‘crash’, and why all of a sudden we have such an uptick in global false-flag events, plus such a rush of new robo and drone technological application in war-making machinery (can’t control the surface of the planet personally, if you are 2-1/2 miles underground in a D.U.M.B.) take a look at Project Camelot and our sun’s binary dwarf brown star Nemesis and its three planets……might be a refreshing perspective on why GovCo seems to just be ‘buying time’, rather than trying to actually solve or address any of the financial issues….

    and for those of you intellectual types who think I may be a bit off, I can assure you I would much rather agree with you, than see the consequences of what GovCo, NOAA and NASA have known about since the early 20th century….only now, are we close enough they can put a timeline on it, and it is a very short timeline…and if you are waiting for GovCo to tell you about it: good luck with that……watch a few ‘disaster’ movies, and see how often GovCo tell the masses about possible upcoming cataclysmic events BEFORE it seals itself away safely in some bunker, leaving ‘the people’ on the surface to deal whatever event….

    just another ‘E-ticket’ ride at Disneyland…..

     
    • Adask

      November 30, 2015 at 11:53 AM

      Again, we live in “interesting times”.

      Everywhere we turn, towards our State governments, towards Wall Street, towards Washington DC, towards the economy, and even towards outer-space, we see discouraging signs.

      I don’t know how many of those discouraging signs will turn out to be true, but one fundamental seems certain: as a nation, we are pessimistic about our future. We may disagree on what particular brand of trouble is headed our way, but a seeming majority of Americans appear to believe that big trouble is coming. Is that belief true, false, exaggerated, or understated? We shall see.

      Looking on the bright side, however, if Nemesis is going to destroy most of the earth in six months, we at least won’t have to worry about Hillary being elected president.

       
  3. Adask

    November 30, 2015 at 11:10 AM

    The fiat dollar’s only remaining value is as “petro-currency” and, from that, World Reserve Currency. It’s role as the only “petro-currency” is gone. A number of other currencies are being used, in addition to the dollar. However, the dollar’s use remains predominant–perhaps 80% or more of world currency transactions take place in terms of fiat dollars. But it’s no longer nearly 100%.

    As the dollar’s predominance is diminished, the dollar will hold less and less of a claim as World Reserve Currency. Today, the fiat dollar is World Reserve Currency (WRC) by custom moreso than by some mathematical formula. Plus, there is no other currency that’s currently able to function as WRC.

    The fiat dollar remains the WRC because there are no other credible contenders for the role.

    The dollar’s perceived value is primarily derived from its status as WRC. If/when anything happens to significantly diminish that status, the dollar’s perceived value should plummet, hyperinflation will probably occur, and the dollar will fall to extinction.

    In theory, the dollar extinction process could happen overnight. More likely, the process will take 1 to 3 years much as it did in Zimbabwe.

    It’s also conceivable that The Powers That Be, seeing that the dollar was virtually certain to fall within, say, 3 to 6 months, would try to impose a “new-and-improved” debt-based monetary system before the dollar died and proved that debt-based currency is insane. That could also happen overnight. One day we have green dollars. The next day we have pink SDRs. Maybe.

     
    • Midnight Gardener

      November 30, 2015 at 6:33 PM

      “…perhaps 80% or more of world currency transactions take place in terms of gold.” Really? Why would those who demonize gold do that? I think gold is much too valuable as a store of wealth to be used as currency or as backing for government money. Also, silver is much too valuable as a commodity to ever again be used as a medium of exchange.

      When paper gold burns government loses control and the real value of physical gold will become obvious…it will not be for backing of government money. Fiat works just fine as a medium of exchange and unit of account if one does not, mistakenly, also try to use it as a store of value. Gold standards have a history of failure…government has a history of failure if one falls for the line that they want to help us. Get yer self some gold, but do not hijack it’s value with a gold standard.

       
      • Adask

        November 30, 2015 at 7:15 PM

        No, not really. I meant to write “dollars” and instead wrote “gold”. My mistake. I’ll correct that error.

        As for “gold standards” having a “history of failure,” note that “gold standards” are not gold-money. They are a relationship between gold and something else that’s inevitably worth much less than gold (like paper dollars). So long as a “gold standard” relates something relatively valuable to something relatively cheap, the temptation and means will always be present to print masses of the “cheap” in order to acquire masses of the something “valuable”.

        When a “gold standard” fails, is the failure in the gold component of that “standard” or is it in the “paper” component?

        When a “gold standard” fails, is the failure in the gold component of that “standard” or is it in the morals of those empowered to administer that “standard”.

        While “gold standards” are clearly preferable to a debt-based monetary system, even “gold standards” are imperfect. If they weren’t, there’d never have been a failure in a “gold standard”.

        My point is that it’s not the “gold” that failed–it was the “standard”.

         
  4. Midnight Gardener

    December 1, 2015 at 4:26 AM

    “My point is that it’s not the “gold” that failed–it was the “standard”.” I can agree with that, but if one wants a gold standard/gold money, they must overcome your three prior points. Physical gold as a medium of exchange is not at all practical in our modern society. Who wants to ship a gold coin to Amazon for a book and a smaller gold coin as change?

    After paper gold burns, physical gold is, again, the perfect store of value…then, fiat money will work perfectly as a medium of exchange. It is the attempt to store wealth in fiat paper and, as you point out, the marrying paper to gold that throws the monkey wrench into the gears.

    Shiny yellow rocks have a long history of storing wealth. The connection of those rocks to paper has been but a brief interruption in that history. When paper gold burns, I would be surprised if one troy ounce goes for less than $50,000 worth of current purchasing power. If the can is kicked beyond my lifetime, that is not a problem as others will reap the rewards…point being, it will happen.

     
  5. palani

    December 1, 2015 at 8:34 AM

    Rock, paper, scissors.

    Rock sinks … can be submerged by water whereas paper floats. Scissors can destroy paper but cannot touch rock.

    Moral? Always carry a scissors with you in the event someone tries to paper you over with debt.

     
  6. Chex

    December 1, 2015 at 12:20 PM

    Black’s Law Dictionary 1990, defines “Money Changers” as: …..business of a banker… today handled by the international departments of banks.” Think for a moment, what did Christ do to the Money Changers.” Yes, he severely interfered with their activity. Three days later he was crucified. Lincoln was killed for interfering with the money changers. Kennedy was slaughtered for interfering with the money changers.

    The General Accounting Office (GAO) is another agency they use for this country.

    This is where all the accounting goes on to keep track of the debt. All the states have to send reports to Washington D.C. Washington D.C. has to send reports to the (GAO).

    Take a look at your state Comptroller’s Annual Report to the Governor of your state. Look under “Trust Fund” for each state sub-corporation like the state courts, IRS, Banks, Education, etc. you will be amazed at the amount of money being pumped into the Trust Fund from the various Corporate State Departmental Revenues (all revenue is referred to as taxes: fines, fees, licenses, etc.).

    There are millions and billions of your hard earned worthless federal reserve notes, “dollars”, being held in “trust.”

    This money is being siphoned off into the coffers of the International Bankers while the corporate government officials are hounding you for more and more tax dollars.

    All this accounting system is NOT so the people will know what is going on. The accounting reports are for the bankers and creditors to keep tabs on just where their collections are coming from.

    The bankers want to know if the bankruptcy debt payments are coming in and just how much and from what sources. This accounting is the purpose behind M1, M2, M3, M4. and M5. All this accounting is closely monitored.

    These M’s are the reports of the amounts of money in circulation. The amount of debt out there, and the amount of credit out there. The floating of debt in the form of bonds. There are five different categories.

    This system had to come into existence in order for the creditors to be on top of the bankruptcy at all times. This system allows the creditors to figure out and know exactly what is going on in their domain.

    Don’t the bankers hire bill collectors? Creditors hire bill collectors to snoop around do see why you’re not paying. They want do know how much you are going to pay so they can figure out how much will be coming in. How much they will collect. They want to know who will pay and who won’t.

    Look at this. Houston Judge a no-show on appointed hearing-date https://supremecourtcase.wordpress.com/2015/11/24/houston-judge-a-no-show-on-appointed-hearing-date/

     
  7. Jim on Oregon

    December 2, 2015 at 2:13 PM

    Chex:

    Thank you for that link and your informative response.

    FYI, Alfred introduced us in two of his AntiShyster magazine articles in 1999 to the FRAUD of the two sets of books used by the governments in all levels. He presented the work of Walter Burien (see his videos on YouTube, including this: https://www.youtube.com/watch?v=hWpbQfkv8Z4 ) in exposing the Comprehensive Annual Financial Statement (CAFR). You gotta watch it to see the depth of the conspiracy is against us. A short and hard-hitting introduction to the CAFR fraud can be seen here: https://www.youtube.com/watch?v=1pRPBKJQnyU

    I am hoping that Al will revisit this Biggest Game in Town and educate us all about this massive FRAUD on the people.

     
  8. Cody

    December 4, 2015 at 8:38 PM

    Good article as usual, Al. As I see it there may be a different reason the scheme can operate perpetually. One of the things that escapes us when we’re talking about “government” is that ours is a “Civil” government. Civil governments presume they own all of the resources and assets within their geographic land mass. In the case of the US, the claims go way beyond that.

    The second key to the puzzle is the ability to extract and produce from the resources, which is generally said to be private, despite the overt governmental regulation.

    With the government “owning” and regulating the production of wealth estimated to be worth over $128 trillion (I once read it was actually $550 quadrillion) in today’s dollars, $18 trillion is chicken feed. That doesn’t lessen the scam of the presumption of government ownership but, it might be the perspective they’re looking at in the long run.

    I don’t know how else to explain whatever has prevented us from already having a global currency. What do you think?

     
    • Adask

      December 6, 2015 at 11:57 AM

      There are limits–even on the human imagination. You can only go so far from reality before your fantasy takes on an aura of madness. In the final analysis, the government creates nothing that is substantive and objectively true. The government relies on lies and fantasies. The American people and the peoples of the world tend to believe those lies and fantasies. So long as that belief remains largely intact, the lies and fantasies seem to be true and seem to work.

      However, although I could be wrong, I am convinced that the lies and fantasies will inevitably be exposed for what they are and rejected by those of us who are condemned to live according to objective reality. Those who are so condemned are the people who actually work for a living. Farmers are on example who must actually grow corn and cows according to the principles of objective reality rather than government fantasies and lies. Sooner or later the weight of government’s lies and fantasies will crush the farmers and leave America with food that is too high to be afforded by most or, in a worst case, non-existent.

      You can’t eat fantasies. You can’t eat lies. Sooner or later those of us who like to eat will be forced to face and reject governments fantasies and lies–or starve to death.

      The claim that government has earned and somehow saved somewhere between $128 trillion and $550 quadrillion is simply a fantasy, delusion or lie. That claim is as bogus as the almighty FDIC promising to guarantee all of America’s bank accounts. In fact, the FDIC has less than 1/2 cent in assets to back up each and every dollar in American banks. If the stuff hits the fan, the FDIC’s “guarantees” will be shown to all to be nothing but fantasies and lies. The idea that the FDIC is guaranteeing all of our bank accounts may be comforting to depositors, but it’s only true for the first 1/2% of the banks that go broke. For the other 99.5% of depositors, there is no government insurance on their deposits.

      Something similar is going on with the rest of governments promises and debts. Government claims to be good for paying its debts and keeping its promises, but those claims have no more substance than the FDIC guarantees. There’s a little truth to the government’s claims, but mostly they are lies.

      I believe that, sooner or later, the government’s debts and claims will be shown to be mostly lies and fantasies. The moment of revelation might happen this month and it might not happen in the remainder of this decade. But it’s going to happen. And when it does, Americans and the world will be forced to eat a big and painful dose of objective reality. Nobody’s going to like it. Many will scream in shock and dismay.

      OMG! The government lies are failing! The consequences could be revolutionary. The USA might break apart into smaller nations/regions. People–especially those who depended most on government lies and fantasies–may die. Lots of ’em.

      The claims that the government as a secret treasury containing $128 trillion are absurd. Where did government acquire all of that cash? Only by spinning it out of thin air like Monopoly Money or by overtaxing the American people to the tune of $128 trillion. $128 trillion in Monopoly Money means hyper-inflation and destruction of the dollar. $128 trillion in excess taxes means the US economy has been depressed and destroyed by excess federal taxes equal to about 8 years worth of our annual GDP. Imagine that your net worth could be 8 times greater than it is, except for government’s excessive but hidden taxes. Would you be ready to revolt? Would you be ready to hang every federal politician and bureaucrat? The government could not survive the revelation that they actually a secret stash of $128 trillion.

      The claim that government has a secret stash of somewhere between $128 trillion and $550 quadrillion is an absurd lie. It might be propaganda designed to fool some Americans who are concerned by the unpayable size of the National Debt into believing all is well, and that the government is honest and benign and is in complete control of our economic future.

      Anyone who believes that is a fool.

      The truths are: 1) the federal government is the biggest debtor in the world; 2) the federal debt is too great to ever be paid in full; 3), what can’t be paid, won’t be paid; and 4) the world is beginning to see that “the Emperor is nude”.

      The big lies of fractional reserve banking, debt-based money, and the US government’s ability to pay more that 20% of its debts are going to fail in the foreseeable future. You and I should live long enough to see it. The resulting chaos will probably resemble the Civil War more than the Great Depression. That chaos may be the very same described in Revelation 18:10– “Alas, alas, that great city Babylon, that mighty city! For in one hour, your judgment has come.”

      There’s more to be read in Revelation 18 that might apply to the U.S. I won’t quote it further other than to note that many who believe the Bible is true are puzzled by the apparent absence of the U.S. from End Times prophecy. How could it be that the almighty U.S. is not clearly referenced in End Times prophecy?

      Well, if it’s true that the End-Times “Babylon” seen in Revelation 18 is really referring to the US and/or western world, maybe the US is implicitly referenced in Revelation 18:21, which reads in part, “Thus with great violence the great city Babylon shall be thrown down, and shall not be found anymore.” If the Bible is true, “Babylon” ceases to exist early on in the End Times chronology

      MAYBE–if End Times “Babylon” is a code for the U.S. and if “Babylon” is thrown down with such violence as to cease to exist forever, that could explain why the almighty U.S. is not clearly mentioned in Revelation and End-Times prophecy. MAYBE the U.S. isn’t clearly mentioned in End Times prophecy because the U.S. ceases to exist early on in the End Times chronology and therefore plays no further significant role.

      If any of that were true, who would be surprised if it turns out that the modern U.S. is basically built on lies (fractional reserve banking, debt-based currency, government’s ability to repay its debts) and therefore collapses into oblivion if/when those lies suddenly failed?

      In any case, I can’t imagine any way that the U.S. government could be truly hiding a $128 trillion stash for “emergency use only”. If the government had that much “extra” money it would spend every dime and then borrow more to spend even more. The $128 trillion claim is a lie or a fantasy intended to create public confidence where there’s no objective basis for confidence.

       
  9. dog-move

    December 6, 2015 at 10:13 AM

    Those inside a bubble never realize they are within a bubble. They are in a Low State of believing a lie, and suffer as a result of it. The U.S. 30 year Treasury Bond has been a safe and profitable place to be since A.D. 1990. In A.D. 1990 the bond price was roughly at 66.46 and here lately 164.95, nice bull market action, but trees don’t grow to the sky.
    It is my understanding that the Treasury Bond Bubble is the largest bubble ever. As long as we have crowds and madness we will always have bubbles. Mass media has allowed this bubble to go on for a long time. I suspect the whole derivative machinery bubble is part of the Tower of Bubble. I am very amazed at the proliferation of exchange traded funds that have been created in the last many years. As these have aided in the upward trend in the value financial assets with their leverage multiplier tools, these will be the cause of serious downside action when the rollover gets underway as there are ETF,s to exploit downside opportunities in every asset class.
    Charles Mackay wrote about bubbles back in A.D. 1841, his book Extraordinary Popular Delusions and the Madness of Crowds, bubbles have been around for a long time.
    Given the madness of the crowd globally, maybe the pop won’t be heard round the world. As with all bubbles, they are fun to be a part of but they always end badly.

     
  10. timmy

    December 6, 2015 at 8:50 PM

    The US is heavily referenced in Revelation… you have to take the symbols with the Bible’s (Old Testament) typical meanings for them. Beast = a political nation, etc. Babylon = a very specific religio-philisophical world view, specifically that man is god and that church (false) and state should be one. (Hence the wearing of the Babylonian fish head, etc. by the Catholic leaders, who are utterly pagan and not truly Christian, btw.)

    A big topic, but just systematically study each symbol in the total context of it’s usage in scripture, especially its first usage and its typical meaning in prophesy passages. Example: Locusts… super clear if you use this approach.

     

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