The Origin of the Tea Party

Middle Class Is Crashing

The Economic Collapse comes to the same conclusion -

If you haven’t read “It’s Impossible to Get By In the US”by Graham Summers of Phoenix Capital Research, you really need to. In his article, Summers analyzes the expenses of a typical family making the median U.S. household income of $50,300 (he was using 2008 figures). According to Summers, if a family making that much did everything right financially, they would maybe have a couple hundred bucks at the end of the month for discretionary spending. But if they overpaid for their house or had any consumer debt then according to his calculations the typical American family would be operating in the red.

The truth is that the day is fast approaching when it will not be possible for the average American family to make it from month to month.

Even now record numbers of American families are failing financially.

In March 2010, there were 158,000 bankruptcy filings. That was up 19% from March 2009’s number, and it was also up 35% from February 2010’s number.

Things are getting scary out there.

The Real Effect

Good to see that the obvious is now observable to anyone who is remotely paying attention. As I have been droning on about for the five years that I have run this blog, this is a DEPRESSION. The kind your grandparents lived through. Now that you're listening you need to hear the following:

1. This depression cannot be avoided. Perhaps it could have been 10 years ago, but not now.
2. Anything done to try to prevent it from happening will make it significantly worse. (Go back, read the commentary on the Great Depression.)
3. Everyone is broke. There are few individuals that actually have the capital to not be broke.
4. The bankers want that capital.
5. This lust for power is the primary reason for much of the suffering in the earth's history.
6. The banking elite don't want you to know that, because if you did, you'd take away their power.
7. The depression will give way to war, probably a world-wide war.
8. The elite want the war because that allows them to consolidate their power and remove potential challenges to their power.

Don't believe me? Here's Karl Denninger -

We now have both driven the low end of the rate curve to zero and taken on more than $3 trillion in new Federal debt. To put this in perspective the total outstanding accumulated Federal Debt at the end of 1992 - from the founding of the US to January 1st of 1993 - was just $4.2 trillion. We added more Federal debt than had been accumulated in 217 years in just a little over THREE years - from 2007 to the third month 2010.

The ugly is that this debt load (currently $12.8 trillion, more or less) presents interest expense. If the Fed Funds Target was to reach just five percent, and every bit of the Treasury debt was to be refinanced into overnight obligations at that same 5%, the interest expense alone of the current debt would be $640 billion a year.

If the Treasury was to have to pay a roughly 6% average coupon (reasonably aggressive with a 5% Fed Funds Target) the interest expense would be $768 billion annually.

To put this in perspective that is an amount roughly equivalent to that spent on defense, and is higher than Social Security, Medicare, or all other "mandatory" program spending combined.

It would consume nearly all of Social Security and Medicare tax receipts ($891 billion) or the personal income tax ($915 billion) (ed. All 2009 federal budget numbers)

It is also four times what we spent last year on interest.

There is not a snowball's chance in Hades that the Federal Government can afford that.

Ron Paul Grills Bernanke On The Massive Expansion To The IMF's New Arrangement To Borrow

Argentina Seizing Pensions

Pension seizing starts in earnest -

So, over $29bn of Argentine civic savings are to be used as a funding kitty for the populist antics of President Cristina Kirchner. This has been dressed up as an anti-corruption and efficiency move. Aren’t they always?

Argentine sovereign debt was trading at 29 cents on the dollar today, pushing the yield to 25pc. Tempted?

Credit Default Swaps on Argentine bonds reached 2,900. Do we have a Latin Iceland on our hands, but with 100 times the population? Or several, Pakistan, Ukraine, Hungary? …… Switzerland? Australia? Britain?

The funds being targeted are known as AFJPs or retirement accounts, but how long will it now be before Mrs Kirchner cracks down on the entire $97bn pool of private pensions? There are a lot of much-needed hard currency assets in those portfolios.

The Real Effect

Banks will start to claim ownership of 401k and pension funds (private and public) and begin "looting" them. (Read as taking your cash and continue to "invest" as they double-double down) and the government moves to “protect” them by seizing them. I would assume they would be placed in a new 'secure conservatorship'.

And if the political will is not present for the banks to do it, they will defer to the government to finish the job.

When you remove the concept of property rights from a society, any sort of property posession becomes scandalous and subject to theft equitable redistribution. For a fee of course, perhaps 80%?

Watch for increased calls of legal reformation to prevent"loopholes", "evasion" and "protests" of individuals that refuse to "pay their fair share of taxes" by allowing the banks to consume their life savings. Of course this will preclude massive rioting, as who wants to work their entire lives to end up destitute at the hands of corporate elite?

Dylan Ratigan MSNBC exposes Federal Reserve Con

Microchipping Airport Workers

States Broke....

From CNN -
A total of 33 states and the Virgin Islands have depleted their funds and borrowed more than $38.7 billion to provide a safety net, according to a report released Thursday by the National Employment Law Project. Four others are at the brink of insolvency.

Here's how much they’ve borrowed from the federal government.

State	Borrowed
California	$8.40 billion
Michigan	$3.78 billion
New York	$3.00 billion
Pennsylvania	$2.81 billion
Ohio	$2.23 billion
North Carolina	$2.14 billion
Illinois	$2.06 billion
Texas	$2.03 billion
Indiana	$1.81 billion
New Jersey	$1.55 billion
Florida	$1.50 billion
Wisconsin	$1.34 billion
South Carolina	$851 million
Kentucky	$760 million
Missouri	$687 million
Minnesota	$638 million
Connecticut	$422 million
Georgia	$337 million
Nevada	$331 million
Arkansas	$318 million
Virginia	$317 million
Massachusetts	$279 million
Alabama	$268 million
Rhode Island	$204 million
Colorado	$186 million
Idaho	$181 million
Maryland	$104 million
Kansas	$65 million
New Hampshire	$23 million
South Dakota	$23 million
Vermont	$23 million
Arizona	$22 million
Virgin Islands	$13 million
Delaware	$1 million

Source: National Employment Law Project

The Real Effect
States going bankrupt?

Situational Report - Going to Be a Rough Weekend

I thought I would offer my readers a quick update on the worldwide situations this weekend. I have employed a danger rating on a 1-10 scale with 10 being catastrophic. Enjoy!

Economy
Greece: (9.5) Seriously in trouble: 6% for emergency loans, capitol flight/bank runs and controls, 3-month yields of about 15%, debt rating cut to BBB- by Fitch, . It's Armageddon for Greece.

U.S. (9.0) - 200:1 leveraging, 11% deficit spending as a percentage of GDP, Banks hiding 42% of debt risks (Greece 2 anyone?), FDIC in Puerto Rico(25% of the island's assets), unemployment deepening, $4 a gallon gas, sporadic riots, Civilian Service Corps(SA brownshirts?), John Paul Stevens is retiring, April 15th is looking like a prime protest date.

Kyrgyzstan - (9.0) Riots, an interim government and a US airbase important to the Global War of Terror. Is Russia smelling blood in the water?

U.K. (9.0) - Gas is $9 a gallon! Good luck recovering.

China (8.5) - A failed bond auction bodes ill. What, Tim Geithner is there? I wonder why...

Canada (8.0) - Has no gold, real estate is looking overpriced.

War
Israel/Gaza (9.0) - Like a bully caught crying on the playground, Israel is going to go home and kick the family dog.

U.S./World (9.0)- Video scandals make the U.S. appear like the bully it is.

U.S./Mexico (9.0) - More troops? And more?

Thailand (8.5) - Martial law in the capital.

Iran - (8.0) - Baring it's teeth, get's centrifuges!

Religion
Catholic Church (9.5) - Sex scandal is melting down any moral credibility the church had. 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, At least it's safer than public school, I guess.

At least it was an uneventful week?

Ron Paul- US Apache Murder

Bilderberg to Meet in Spain

From Paul Joseph Watson -

The Bilderberg Group will meet this year in Spain and continue to advance their agenda for world economic governance while agreeing to prolong the global financial recession for another year, according to Bilderberg sleuth Jim Tucker, who has discovered through his routinely accurate inside sources that the conference will take place from June 3-6.

Bilderberg sleuths were correct in predicting that this year's meeting would take place in western Europe, but were wrong in pinpointing the UK as the likeliest location. The 2010 conference will take place in a coastal resort called Sitges, which is about 20 miles from Barcelona.

This year's confab will focus around prolonging the global financial recession and creating more economic woe in order to provide the pretext for more regulation in pursuit of world economic governance, according to Jim Tucker's sources.

"Bilderberg hopes to keep the global recession going for at least a year, according to an international financial consultant who deals personally with many of them. This is because, among several reasons, Bilderberg still hopes to create a global “treasury department” under the United Nations. Bilderberg first undertook this mission at its meeting last spring in Greece, but the effort was blocked by nationalists in Europe and the United States. “Nationalists” (a dirty word in Bilderberg) objected to surrendering sovereignty to the UN," writes Tucker.

Tucker's source highlighted a recent speech by French President Nicolas Sarkozy in which he called for a "new global monetary order.” As we have highlighted, such rhetoric has been abundant over the past year, with British Prime Minister Gordon Brown and EU President Herman Van Rompuy repeatedly echoing similar ideas.

SILVER to $436/oz and Beyond?

Criminal Cops Shoot Woman In The Face, Then Laugh At Her

We Live In a Land of Laws?

CNN reports the following via Vox -

By April 2005, when Bextra was taken off the market, more than half of its $1.7 billion in profits had come from prescriptions written for uses the FDA had rejected. But when it came to prosecuting Pfizer for its fraudulent marketing, the pharmaceutical giant had a trump card: Just as the giant banks on Wall Street were deemed too big to fail, Pfizer was considered too big to nail.

Why? Because any company convicted of a major health care fraud is automatically excluded from Medicare and Medicaid. Convicting Pfizer on Bextra would prevent the company from billing federal health programs for any of its products. It would be a corporate death sentence.

Prosecutors said that excluding Pfizer would most likely lead to Pfizer's collapse, with collateral consequences: disrupting the flow of Pfizer products to Medicare and Medicaid recipients, causing the loss of jobs including those of Pfizer employees who were not involved in the fraud, and causing significant losses for Pfizer shareholders.

"We have to ask whether by excluding the company [from Medicare and Medicaid], are we harming our patients," said Lewis Morris of the Department of Health and Human Services.

So Pfizer and the feds cut a deal. Instead of charging Pfizer with a crime, prosecutors would charge a Pfizer subsidiary, Pharmacia & Upjohn Co. Inc.

The Real Effect
Wow, just wow...

Greece Is NOT Under Control

A sobering look at the current economy by Denninger -

There's no particular reason for Greece to get funds from the Eurozone "directly" in this case irrespective of anything else. If there's no rate advantage why not just sell into the market?

This is the problem with debt spirals, you see. Trying to borrow and spend your way out of recession runs the risk of interest costs exceeding cash tax inflows. If that happens you're done, and the market will react to the possibility long before it actually happens.

Contrary to popular belief we aren't any better off than Greece is. We've been at the same game they played for the same amount of time, basically - we embarked on our "borrow and spend to lie about GDP" in 2003, and we have maintained that level of borrow and spend ever since, until it blew out to where it is now in 2008.

Those who refuse to learn from what others have done (and blew up in their faces) are destined to have to go through it themselves.

We cannot mask a 10% GDP deficiency for very long. We've gotten away with it for two years, with the first of those years coming on the back of an all-on stock market collapse that fed the bond market with fear-driven money, and the second half with "QE" and similar shenanigans.

But now both of those influences are gone - and we're still trying to spend and borrow the same way, continuing to lie about our GDP circumstances.

We had better stop it and get behind some concrete block before Greece goes up in smoke - from what I can see from here, which is an admittedly-imperfect picture, the only two ways out for them are an outright default or departure from the EU; the latter would allow them to issue in massive quantity and thus effectively devalue.

Nothing else is going to work - they're too far down the hole - and if we don't cut this crap out right now we're going to follow them down the bowl.

The Real Effect
Of course Denninger is correct in noting that we are facing a similar fate as Greece, the operative question is - How do you "bail out" the largest economy in the world? And if the eurozone is so hesitant to "help" Greece, how much more hesitant will the world powers be to help us? I think we know the answer to that question.

Keep a close eye on Greece as the countries of the world blow out their currencies in a coordinated fashion so as to set up the idea that collapse was "unavoidable" and that we now need a global currency to chase the global trade zone.

There was a reason why Jesus chased the money changers out of the temple...

Rep. Hank Johnson Fears Guam May Capsize

And people wonder why I have issues with government run anything....

Woman Has 5 Agents Invade Home

Monty Python - Crackpot Religions Ltd.

Police “Welfare Check” Leaves Woman Dead

Brilliant and it makes the point that I will expound on at a later date -

Police in Franklin Township, New Jersey recently announced an innovative program “designed to improve the safety of senior citizens,”reported WCBS-TV.

Through “Operation Blue Angel,” elderly residents would leave a key to their front doors in a lockbox accessible by a combination known to police. Police doing “safety checks” of the homes would knock on the door and, if nobody responds, would use the keys to enter.

What could possibly go wrong? What does anybody have to fear from angelic armed strangers sent to check on their “welfare”?

One possible problem is demonstrated bythe shooting death of a 47-year-old Prairie Village, Kansas woman this morning (March 31).

Police were sent to her apartment to conduct a “welfare check.” For some reason, the woman didn’t want to be “helped” by the friendly state functionaries with guns.

Oh, but we insist, replied the “Blue Angels,” as they summoned their khaki-clad comrades from the Tactical Squad. Eventually, because of “threats” she supposedly made against the stormtroopers, the police (in the words of a local TV reporter) “were forced to shoot her.”

Perhaps it has something to do with this -

Tarred and Feathered speed van 911 call

The Hilarity of Government Thugs

Every once and a while you just have to laugh at the clueless clowns in the room -

with the city facing a budget deficit that could drain its reserves by summer, Mayor Villaraigosa wants to re-open contract talks with 45,000 cops, firefighters, librarians and other city employees in hopes of persuading them to contribute more to their pensions and health-care costs. His deputy chief of staff, Matt Szabo, puts it bluntly: "Unions have priced themselves out of a job."

What? We can't demand whatever no matter how out of line with the private sector?

In December, state and local governments spent an average of $39.60 in wages and benefits per hour worked on their employees, versus an average $27.42 for private employers, the Labor Department said.

You do realize that government employees spend 44% more than a private employee? And who is paying for that? Since government can only seize wealth, the private employee.

Just to drive home the fact that union employees are absolutely clueless -

Public-employee unions argue that it's unfair to penalize them for a financial crisis that isn't their fault. They say cities and states are opportunistically taking advantage of a short-term crisis to gut benefit plans in place for decades.

The Real Effect
Uh no, what is "unfair" is expecting individuals who are UNEMPLOYED to support your behind with a good percentage of what they DON'T have because you like a big check. Get used to it, because the electorate knows that the public won't tolerate a much higher level of taxation without revolting completely, at which point YOU will be the one unemployed.