Economic Devastation

[iamback]

Cross-posting from the Skycoin thread...

The increase in technology, knowledge, productivity, machinery is constantly pushing the cost to do things down. A person could operate one lathe by hand, now a technician can operate a thousand CNC controlled lathes. Soon a technician with robots will be able to operate an infinite series of lathes and shuffle work units between lathes and CNC machines in a factory anywhere on earth, from a laptop.

A single person will be able to design a thing, have millions of pieces machined out and then assembled into a structure. The physical world will increasingly look like a game of Minecraft being played by robots. The same robot on earth that can build a castle or pyramid in an Africa desert over the internet, can build the same structure on the moon or mars, from the same laptop on the same beach.

---

The reason companies are organizing theses cartels through government, is that they are on their deathbed. The large companies are unable to achieve consistent long term profitability without a government organized cartel, subsidies and a heavy financial manipulation by the FED.

That is the bifurcation of the economy I was writing about in the Economic Devastation thread.

http://mobihealthnews.com/36874/the-evolution-of-ibms-watson-and-where-its-taking-healthcare/

http://armstrongeconomics.com/2015/02/21/doctors-lawyers-peaking-with-2015-75-the-crash-burn/

The two fields that are peaking with this turn in the ECM appear to be law firms and the medical industry. Both has become extremely arrogant and way over-priced. The entire Obamacare was REALLY about hospitals who had to provide care for indigent people who just showed up in emergency rooms. Obamacare was all about making sure these medical-for-money corporations did not have to do anything for free. But in trying to guarantee their financial security, he has established the high.

The legal profession has committed suicide. The big firms have so over-priced themselves and pad the bills unbelievably it is outright criminal. I actually had a lawyer send me a bill [for an] attempted phone call not answer[ed]Analysis on a closer level reveals how the greed of the “Largest 50” firms has taken it toll. There has been a distinction shift in legal work from the “Largest 50” firms to the “Large Enough” category is far more dramatic. The “Large Enough” firms have almost doubled the share of high fee litigation matters that generate fees exceeding $1 million or more rising from 22% three years ago to 41%. This is contributing to lawyers being laid-off.

http://armstrongeconomics.com/2015/02/21/comment-from-the-medical-profession/

I laughed out loud this morning reading your blog. Your blog piece about how doctors (health care in general) and lawyers are peaking with 2015.75, I believe is spot on.

Looking back at the past 10 years I have been in practice, the fortunes of my group do trace out the ECM. There was a soft landing from the bottom in March 2009… an Ice storm! Independent medical practices that are still afloat are delving into real estate and other ventures. Just look at the number of practices or any health care ventures in strip malls and retail commercial space at this time. Think back ten or 15 years ago…. how many back then? I believe this is part of the peak.

At a conference not dealing with medicine, I sat next to a hospital administrator of a small outlying facility in southwestern Pennsylvania. The projections from his association for their future is for 50% of small outlying hospitals to be closed in the next 5-10 years. (The periphery goes first!)

From a personal perspective, I appreciate very much your opening up your thoughts and teaching to the little guy. I have felt for some time that something is wrong but could not put my finger on it.

[iamback]

CoinCube,

China can write down the debt because they have so much upside. Japan was already a first-world economy and had already maxed out. China is no where near maxed out, and is in fact highly retarded from its potential because of the Communist Party holding back the full capability of China's free market. All that top-down driven debt growth was focused on negative profit margin activity being driven by the corruption in the political system. The coming Minksy Moment correction will force radical openness in China and it's fully potential can be realized.

China isn't bankrupt in social capital as the West is. The population is still young enough (not as young as SE Asia, but not mostly retiring as the West is) and very erudite with strong family values and hard work ethic.

Also Chinese are naturally explorers and traders, unlike the Japanese who are insular and tyrants (and a very old population). Through trade instead of war, China is leveraging Africa, SE Asia, etc..

The West is decadent and the social capital is negative and everyone is entitled and overpriced.

The Chinese political elite if they could, would extract as much as they could from the peasants, just like the American elites. However, they have a much weaker hold on power. They are also engineers and not lawyers and have a much clearer vision of the world undistorted by lobbyists, think tanks and a controlled media. China has experienced thirty years 10% economic growth with living standards doubling every eight years for decades. The Chinese political elite are aware that they will remain in power only as long as they continue to deliver prosperity and increasing standards of living. For Chinese, to return to even living standard a few years ago is a 30% decline and the public would riot and draw blood. Even a decline to 6% yearly growth is problematic, while Americans have been kept at the same living standards since the 70s. Chinese riot when pork prices rise and hold their leaders accountable for even things they cannot control, while Americans accept even the greatest abuses of government.

Chinese do not want cheap slogans about "democracy", they want iPhones, sports cars and houses.

There is a turbulent period coming for China wherein the people come to realize that what they've been doing doesn't work.

If China choose to tax and financially repress to prevent writing down the debt for 26 years as Japan did, then the Chinese standard of living will decline (and it is not that high yet), thus I think the Chinese peasants will riot and the system will have to change. The last major inflection point for China was when Deng embraced capitalism under a State model. This coming Minsky Moment should push China to make the shift to ending the State oppression. However during this transition, the State may try to make war with Japan as a scapegoat and to direct peasant angst towards nationalism. The Chinese are not as religiously nationalistic as the Japanese who whor(e)ship an Emperor. The Chinese spit and defecate along the road. Japanese are very conforming society and more like cats than the Chinese who are more like dogs. Japanese sip tea and have many formalities of social behavior. The Chinese gets things done any way they feel like it (did you read about them putting straw in the concrete to save money so the bridges collapsed, the Japanese would never do that!). China is a mainland held back from conquering the world by geography (Himalayan mountain range blocks projecting supply lines for war) and Japan is an island. Two different cultures arose from that differing geography.

[CoinCube]

Below is a very good introduction to the concepts and consequences of fiat currency.
It's is somewhat introductory but well written and easy to understand it probably a good starting point for those just learning about the concept. Great coverage of the history of fiat currency in ancient times. I learned some historical facts that I did not know previously.

http://www.acting-man.com/?p=35965

[iamback]

OROBTC,

NZ is shifting with Kim Dot.com leading the way politically. It is a member of the USA's 5 Eyes, but the people are turning against their own government. It is a socialist country, but the natural resources far outweigh the population at this point, so the capital is not bankrupted. An influx of high tech workers can transform NZ into a paradise and this is what I think will happen. I am even drooling at the pics of NZ. I wouldn't go for NZ citizenship, but I might live there during the summer. That Kim Dot.Com could so impact the politics there is indicative of NZ being small enough and manageable enough to adapt, unlike the USA which is a social capital morass of epic proportions.

Australia is also shifting politically back towards more conservative but it is bigger morass (incorrigible, youth drugs is very widespread) and less adaptable. But still much more upside than the USA. Has a wider range of climates than other choices in Asia. As a NZ citizen, you can reside in Australia.

Canada is slightly better than the USA for similar reasons, but I agree with you the climate is too cold for me. For many Americans it may be the most practical plan B.

CoinCube is wise to select Singapore as the best of Asia. I agree. Hong Kong is another slightly more turbulent option. And a pathway to leveraging China. You can still get residency and a travel document (Stateless person) there by just landing there and renouncing your US citizenship (a little secret most people don't know, but make sure you check with an attorney first).

I am ignorant of Taiwan. Passed through the airport there only. Met one young man from Taiwan in 1991 in New Orleans and showed him around the French Quarter, then he sent me a calendar scroll from Taiwan! He told me Philippines could never be productive because it is too hot of a country. Decades hence, I agree with his astute analysis.

The corruption of the Philippines is precisely what makes it such a great place to live. The Philippines is for people who hate to have any rules. Filipinos hate discipline. If you like discipline, erudite schools, and an accomplished life, don't migrate to the Philippines! The Philippines is the place to go to goof off. I am about done with the Philippines. I would like to focus more on quality of life and work. The Philippines will remain a great place to play and I will be back to visit. But not a great place to live if you want to maximize productivity. Everything is more inefficient.

China is not for most Westerners. Yes you need to learn how to work within their system which is a mix of lies, corruption, two-faced, backstabbing, but also erudite and productive. Did you see they built an entire building in a day?

South America is violent. But there are some good options there for citizenship. One doesn't need to live where they hold citizenship. One would want to study the future tax direction of that country though. Most Latin American countries are very socialist. Ecuador, Venezuela, Argentina, Brazil come to mind as being very socialist. Guatemala appears to be less so and more like the Philippines.

[CoinCube]

...

CoinCube must be a banker with Goldman-Sachs, look, his reply number is 666...  
...
For me, that leaves Latin America.  I speak Spanish, so there is some choice (but I do not speak Portuguese, so Brazil is out for me).  We have our company in Peru (as well as nice in-laws there), so Peru wins by default in my case.  Other places in LatAm might work: Costa Rica, Panama, Chile, Uruguay and even Paraguay might be OK.

Now look what you have done. You have totally gone and blown my cover  

Of those Latin American countries Costa Rica is quite nice I found it to be friendly and safe. The people were mostly middle class reasonably well educated and friendly towards foreigners. I was not at all impressed with Panama. Very poor and somewhat dangerous. I did not feel safe when I traveled there. Costa Rica also has low income taxes and no capital gains tax.

There is a turbulent period coming for China wherein the people come to realize that what they've been doing doesn't work.

If China choose to tax and financially repress to prevent writing down the debt for 26 years as Japan did, then the Chinese standard of living will decline (and it is not that high yet), thus I think the Chinese peasants will riot and the system will have to change. The last major inflection point for China was when Deng embraced capitalism under a State model. This coming Minsky Moment should push China to make the shift to ending the State oppression. However during this transition, the State may try to make war with Japan as a scapegoat and to direct peasant angst towards nationalism.

I hope you are right and China smoothly transitions to a better system. Historically, however, sucessive Chinese governments do not have the best track record when it comes to smart economic choices.

In an effort to maintain control the Communist party may choose the path of nationalism as you outline above and financial repression via ever increasing government spending/malinvestment. This spending would achieve "growth" and placate an increasingly agitated population for a time. To achieve your more optimal outcome requires the abolishment or at least significant restructuring/reform of the ruling communist party. I hope that happens but it does not seem inevitable to me in the immediate future.

 

[iamback]

CoinCube that is the big open question which is regularly discussed at http://mpettis.com

I don't think it will be smooth. I am expecting a Minsky Moment collapse and I think China will gyrate through war first before settling into a new path of growth. I think this is why Asia won't become the new financial center of the world until 2033. China can't head there in a straight line.

So yes, I am concerned Asia could also be hit with war. This is the reason I am also looking at South America too.

NZ seems far enough away from the China sea. With Singapore citizenship, I bet you could residency in NZ or vice versa, if SE Asia descends into war.

But the other possibility is Japan is really bottoming. They will have a flash crash and finally  bottom. Thus Asia is aligned for mutual interest in a growth model with the Asian Union starting this year.

I suspect Asia might rattle the sabers but end up working together. Japan needs SE Asia.

[iamback]

Costa Rica is an interesting choice. They managed to avoid having a military!

I'd be concerned about culture for your kids in the schools. Seems too laid back. The "mañana" mentality which is pervasive in any brown skin country (winter forced white people to be serious and productive, long before Socialism destroyed our culture).

[grendel25]

And this is just the power of prophetic motivations.  If you can dream it you can do it and if you can convince enough people of it's manifest destiny then it truly will happen.

[CoinCube]

And this is just the power of prophetic motivations.  If you can dream it you can do it and if you can convince enough people of it's manifest destiny then it truly will happen.

In the spirit of having a little fun

I will reply to your rational citation of Reflexivity with its natural antithesis... French poetry from the era of Romanticism

"Armies cannot stop an idea whose time has come. Nothing is as powerful as an idea whose time has come." -Victor Hugo

Of course what Victor Hugo actually wrote was "On résiste à l'invasion des armées; on ne résiste pas à l'invasion des idées." but that lacks the pizzazz of the liberal English translation.

[iamback]

It is true that current (officially reported) government spending in china as a percent of GDP at 23.9% is much lower then the USA at 41.6% or Japan at 42%.

Counting all the costs of compliance with regulations it is much higher than 60% in the USA and Japan. Meticulous, perfectionist Japan regulates everything even the gloves worn by taxi drivers. Regulations are very lax in China.

Note the linked page:

Additional data and sources, inputs, and encouragement provided by Nobel Laureate Economist Milton Friedman.

Note I exchanged email with MW Hodges back in I believe 2010. I have quoted that email exchanged some where on this forum. But I don't feel like digging for it right now.

[CoinCube]

The whole issue of "Plan B countries" is very complex, at least for Americans.  There are a slew of factors to be taken into account, and these factors have to be judged for each individual.
...
1)  Plan B countries among the "developed countries"?  Well, ahh, I don't know.  ALL of them have arguably MOAR problems than the USA.  Canada?  Europe?
So where would an OROBTC go?  Europe and all/most of Asia are not attractive.  

In Europe Norway may be the best choice.

Not tied to the Euro. Very socialist with massive taxation but sustainable (at least for a long while) with zero government debt and massive government reserves. Probably the safest currency in Europe right now. To date they have been fiscally disciplined and keep spending in line with revenues. Redistribution is not necessarily bad if it is sustainable and voluntarily chosen by an educated population with full understanding of the trade offs involved.  

http://www.zerohedge.com/news/2013-07-30/heres-some-data-safest-fiat-currency

Norway’s central bank, which issues the krone, has among the highest capital ratios of any central bank in the world at 23.3%.

Moreover, the Norwegian government has zero net debt, i.e. its total financial assets far exceed debt.

Norway isn’t part of some supranational body like the European Union, which means that Norway cannot be stuck with some other nation’s liabilities (just as we see Luxembourg stuck with a share of Greece’s bailout…)

Last, the krone is not pegged to any other currency, so it can’t be dragged down with a sinking ship.

In a paper currency system controlled by a tiny banking elite, the Norwegian krone is as ‘low risk’ as it gets

[CoinCube]

NZ is shifting with Kim Dot.com leading the way politically. It is a member of the USA's 5 Eyes, but the people are turning against their own government. It is a socialist country, but the natural resources far outweigh the population at this point, so the capital is not bankrupted. An influx of high tech workers can transform NZ into a paradise

For anyone who has not kept up with the Kim Dotcom story I highly recommend you read this story in the guardian.

http://www.theguardian.com/technology/2014/aug/17/kim-dotcom-megaupload-new-zealand-interview

As Dotcom fought the extradition order through the courts, incredible details began to emerge. An unlawful court order was used to carry out the raid. Process was abused multiple times in multiple different ways. Edwards fills in the details: "He was spied on illegally. Laws were broken...

Dotcom and his lawyers discovered was that his personal data going back for years – emails, phone calls, texts, Skype calls – had been harvested using the 5-Eyes spying system...

They used XKeyscore, which is basically the Google of the 5-Eyes cloud, and they've downloaded everything, every single email, every single chat message," he says. And it was this archive of information that was used to construct the case against him.

I'm probably the one individual in the world who is closest to getting discovery on what this material is, on getting visibility around this kind of spying, and what mass surveillance actually means to an individual like me. I'm the closest anywhere in the world in a relatively good judicial system to getting the answers that they are trying to cover up. I am entitled to that data; it is a much more complete set of data than I have and it would completely exonerate me. They are sitting on a trove of evidence that I could use in my case… so what they did in order to prevent that from ever happening is that they just deleted it.

The New Zealand government froze his assets, without which he had – theoretically – no access to legal representation. (He has elsewhere tweeted: "The sad reality is that there is no justice if you can't afford it. That's why the US government seized all of our assets from the start." The result is that Dotcom, Fisher believes, is "fighting for his life. He doesn't want to do 80 years in an orange jumpsuit.

Dotcom is certainly refusing to see it any other way. The fightback has only just begun, he says. "The internet is only 20 years old. It only really took off in the last 10 years. It's all just beginning. And it's great that we now know that our data is being stored and that it can be used against us. That now will always be in the back of people's minds and it's going to drive this whole new business sector. It's going to be a cat-and-mouse game and I'm glad that everyone knows about this because we can now actually do something about it.

We can beat the intrusions of government with innovation, with technology. We can beat them with our brains. That's what the internet is all about. They can try and do all those things but in the end we'll have the technologies to beat them.

As there’s little progress in the criminal case, the U.S. launched a separate civil case asking the court to forfeit the bank accounts, cars and other seized possessions of the Megaupload defendants.

The recent US legal tactic of seizing all a persons money before a conviction depriving them of the resources needed to mount an effective defense takes us several steps down the road to tyranny. Having failed to get New Zealand to rapidly extradite and having failed to keep his assets in Hong Kong competently frozen (his lawyers can now access them for his legal defense) the US has switched tactics and is trying to win via civil forfeiture laws and just take the funds.

Kim Dotcom has now been declared a fugitives from justice for refusing to voluntarily travel to the US while he appeals his extradition. The US is also arguing the Kim Dotcom's lawyers do not have the legal standing to challenge the civil forfeiture in court because of his fugitive status.  

Are these the actions of a free country that respects due process rule of law and constitutional rights?

http://rt.com/usa/207443-kim-dotcom-megaupload-fugitives/

[iamback]

The whole issue of "Plan B countries" is very complex, at least for Americans.  There are a slew of factors to be taken into account, and these factors have to be judged for each individual.
...
1)  Plan B countries among the "developed countries"?  Well, ahh, I don't know.  ALL of them have arguably MOAR problems than the USA.  Canada?  Europe?
So where would an OROBTC go?  Europe and all/most of Asia are not attractive.  

In Europe Norway may be the best choice.

Not tied to the Euro. Very socialist with massive taxation but sustainable (at least for a long while) with zero government debt and massive government reserves. Probably the safest currency in Europe right now. To date they have been fiscally disciplined and keep spending in line with revenues. Redistribution is not necessarily bad if it is sustainable and voluntarily chosen by an educated population with full understanding of the trade offs involved.  

http://www.zerohedge.com/news/2013-07-30/heres-some-data-safest-fiat-currency

Norway’s central bank, which issues the krone, has among the highest capital ratios of any central bank in the world at 23.3%.

Moreover, the Norwegian government has zero net debt, i.e. its total financial assets far exceed debt.

Norway isn’t part of some supranational body like the European Union, which means that Norway cannot be stuck with some other nation’s liabilities (just as we see Luxembourg stuck with a share of Greece’s bailout…)

Last, the krone is not pegged to any other currency, so it can’t be dragged down with a sinking ship.

In a paper currency system controlled by a tiny banking elite, the Norwegian krone is as ‘low risk’ as it gets

In some past post, I showed that they are very dependent on oil revenue and afair approximately within a year they would deplete their reserves without the oil revenue. Their oil revenue will decline significantly with the drop in the oil price, because many of their deep sea wells will be uneconomic.

[CoinCube]

In some past post, I showed that they are very dependent on oil revenue and afair approximately within a year they would deplete their reserves without the oil revenue. Their oil revenue will decline significantly with the drop in the oil price, because many of their deep sea wells will be uneconomic.

From what I can tell the total current annual government spending of Norway is around 87 Billion USD.

The Petroleum Fund of Norway. The fund is commonly referred to as The Oil Fund (Norwegian: Oljefondet). As of the valuation in June 2011, it was the largest pension fund in the world, although it is not actually a pension fund as it derives its financial backing from oil profits and not pension contributions. As of September 30, 2014 its total value is NOK 5.534 trillion ($857.1 billion),

Even if they completly stopped collecting taxes, all oil revenue instantly ceased, and they did not cut any spending they could last almost 10 years just on their savings. Below is a chart of total government spending for Norway. Its shows the amount each quarter (in millions of Krones) so you have to multiply it by 4 and convert the Krone to the USD which is 1 NOK = 0.132 USD currently.




Norway has a population of 5.1 million and government savings essentially equal to $160,000+ per person.
USA has a population of 320 million and government debt of $56,000+ per person

[iCEBREAKER]

The recent US legal tactic of seizing all a persons money before a conviction depriving them of the resources needed to mount an effective defense takes us several steps down the road to tyranny.

Like parallel construction, this is one of the new Intolerable Acts.  

King's Men and patriots will die settling the score for such affronts to the liberty of free people.

When the assassination markets are ready, the "awkward stage" will end and we will water the tree.

[iamback]

CoinCube, you know how to use Google to search my archives? (search site:bitcointalk.org ...)

Norway's savings is wiped out by their external debt:

https://bitcointalk.org/index.php?topic=365141.msg9862184#msg9862184

Sorry but large levels of socialism and taxation are never adaptable and always end up in massive failure. Norway has a 78% tax on oil revenue!

I found a figure of $160 billion for annual government expenses, but even if I was mistaken on that, my point remains valid that Norway is not fiscally strong. They have a huge socialism bill (that will worsen as their boomers retire) to pay dependent on revenues which can wither.

[CoinCube]

CoinCube, why do I have to repeat myself so much? You know how to use Google to search my archives? (search site:bitcointalk.org ...)

Norway's savings is wiped out by their external debt:

https://bitcointalk.org/index.php?topic=365141.msg9862184#msg9862184

Well you do have a lot of posts under a lot of different user names

Great linked post I missed it when you first put it up. I am copying the most relevant parts of it below.
Norway government debt is $737 billion and their oil savings fund is $857 billion net positive $120 Billion (at current market rates) and per capita positive of $23,500. Enough to fund a year and a half of current expenses with no incomming revenue not ten.    

Still they have some significant reserves. Enough to do much better than the rest of the Europe so it’s a relative safe haven.

http://www.rigzone.com/news/oil_gas/a/136374/Norwegian_Oil_Firm_Noreco_to_Restructure

Norwegian Oil Firm Noreco to Restructure
by  Reuters | Monday, December 15, 2014

OSLO, Dec 15 (Reuters) – Norwegian oil firm Noreco proposed a restructuring as low oil prices and persistent production problems at its key assets are threatening its ability to remain a going concern, it said on Monday. Noreco, which holds stakes in a handful of British, Norwegian and Danish fields, said it needs to fully convert its outstanding bond debt as it was burning through cash rapidly and cannot pay interest or service its debt.

http://www.rigzone.com/news/oil_gas/a/136404/Norways_Statoil_Approves_610M_North_Sea_Development

OSLO, Dec 16 (Reuters) - Norwegian energy firm Statoil ... has delayed several new developments as low oil prices and high costs have reduced its profitability, eating into its cash.

The North Sea oil dependent countries have a huge problem with the ability to finance HUGE per-capita external debt levels as their export oil revenues wane.

http://www.telegraph.co.uk/finance/comment/edmundconway/6505670/North-Sea-oil-is-dragging-us-into-the-red.html

for the past quarter of a century, Britain has been a petro-economy. In 1999, we were producing more oil than Iraq, Kuwait or Nigeria. The following year, we pumped out almost twice as much natural gas as Iran – a country with reserves that are the envy of the world.

There are two problems, however. The first is that the stuff is running out. Production of North Sea oil has halved in the past decade; Britain has gone from being comfortably self-sufficient in oil and gas to being a net importer.

http://gcaptain.com/norway-reviews-gdp-growth-estimates-oil-plunge-continues/

A 41 percent drop in oil prices from a June high is proving to be the worst since the financial crisis erupted in 2008. The slump has put pressure on a nation [Norway] that relies on energy resources for about 22 percent of its [GDP] output.

In the “short term, the disturbances in the Norwegian economy will not be as large,” Solberg said. Norway funnels its oil riches into an $870 billion sovereign wealth fund, the world’s largest. The government follows a self-imposed cap of 4 percent of the fund when it plans [deficit] budget spending.

‘Dark Clouds’

Over the past decade, Norway’s reliance on oil has been its main strength. Booming prices helped keep unemployment below 3 percent even as other parts of Europe suffered double-digit jobless rates.

https://en.wikipedia.org/wiki/List_of_countries_by_external_debt  (sorted by highest per-capita first)

Rank	Nation	External Debt	Per Capita
5.	United Kingdom	$9.6 trillion	$160,158
7.	Norway	$737 billion	$131,220

Note that 22% of GDP for oil quoted above doesn't include the Norwegian government which is 44% of the GDP and gets most of its revenues from taxing oil! Thus greater than 50% of Norwary's GDP is dependent on oil and it is claimed to be fiscally strongest country in Europe!

https://en.wikipedia.org/wiki/State_budget_of_Norway

Total costs: $160 billion
Tax Income: $124 billion

http://www.theguardian.com/commentisfree/2014/sep/04/oil-tax-norway-could-teach-australia-a-thing-or-two-about-managing-wealth

In Norway, companies drilling for North Sea oil pay a 78% tax rate on income...

http://armstrongeconomics.com/2014/12/16/russian-ruble-collapses-conspiracy-or-warning-of-things-to-come/

There was nothing that survived during the Great Depression from stocks, bonds, commodities, tangible assets, to currencies. This is what we are facing. The complete meltdown of the world economy thanks to the convergence of many factors. Just about anything that can go wrong is going wrong and the end game is not looking pretty. As we can see from this chart of the bond market, while Andrew Mellon first bragged when the stock market crashed “gentlemen buy bonds”, those who ran into the bond markets either were left with nothing as sovereign debt defaulted, or their US bonds were suddenly devalued by FDR and the gold redemption closes were reneged upon.



The Middle East has become addicted to high energy prices and thus they have increased their budget taking into consideration expectations of perpetual high energy prices. [meaning OPEC can't cut production because they need the revenues]

During the Great Depression, stocks rallied into 1929 but commodities peaked in 1919. The tangible commodity sector declined into 1932 coinciding with the stock low. That 13 year decline was profound. It wiped out much of the commodity industry.

We are dealing with a very serious crisis within the global economy that is by no means limited to Russia or oil.

We are witnessing the unraveling of the world economy because we have pervasive corruption in government...[/td][/tr][/table]

Crude oil has two numbers we must now pay close attention to for year-end $75 and $57. A closing BELOW $57 warns that we are in serious trouble with oil and we may not see the final low until 2016-2017. The real critical level of support lies at $32. We should see this type of decline send crude back to retest the 1980 high of about $40 similar top gold retesting the $875 high of 1980. Welcome to the land of DEFLATION as all the promises of socialism with government taking care of you from cradle to grave is over and done with.

Consequently, additional proof that this is not limited to Russia is just open your eyes. There is a crisis in ALL EMERGING markets. As the dollar rises and commodities decline, this is part of the cycle that sets in motion the Sovereign Debt defaults.

We are looking at a major decline within the world economy. This is part of Big Bang. We will produce a major and very serious report on this entire subject matter after the closing of 2014.

[iamback]

Enough to fund a year and a half of current expenses with no incomming revenue not ten.

The Sovereign Debt crisis won't bottom until 2024 or so...

The citizenry I assume has become entitled, spoiled, overpriced. Humans don't readjust quickly from this state. They go kicking and screaming back to poverty, not willingly with foresight and planning. Socialism destroys humans.

I repeat my point from upthread that trajectory is more important.

P.S. Note I had edited my post to be less acrimonious but you quoted my flippant comment. Apologies. I guess I am feeling pressured today to get many things done. I need to head out to rent the better house. Worried about my finances and how to complete many tasks pronto. But health is strong today!

[Gyfts]

I'd like to take a moment from your learned "OMG, economic devastation" discussion to share some great news: For Bitcoin, it's already in progress.
We broke $280!
You may now return to prognosticatin' doom & disaster

Come over a month later we are 40 dollars plus below that. I wouldn't bet on a complete economic meltdown. But, hypothetically speaking, I could imagine Bitcoin prices, and gold for that matter, soaring in value when fiat collapses.

[CoinCube]

I'd like to take a moment from your learned "OMG, economic devastation" discussion to share some great news: For Bitcoin, it's already in progress.
We broke $280!
You may now return to prognosticatin' doom & disaster

Come over a month later we are 40 dollars plus below that. I wouldn't bet on a complete economic meltdown. But, hypothetically speaking, I could imagine Bitcoin prices, and gold for that matter, soaring in value when fiat collapses.

The PostWar Decline in the Price of Silver 1920-1933 (pdf link)

From 1926-1929 Silver traded between 53 and 60 cents per ounce in New York.
In 1929 (onset of the Great Depression) the price for silver began to decline and went down steadily through 1930 reaching an all time low of 25 cents per ounce in New York in Feburary, 1931. During 1931 and 1932 the price stabilized at a new low level between 25 and 32 cents per ounce before reaching a new all time low in December 1932 of 24 cents.

It was not until 1933 (three years after the start of the great depression) that silver begain to rise in terms of depreciating American dollars.