-- Posted Friday, 30 April 2010 | | Source: GoldSeek.com
By R. D. Bradshaw
For the past 15 months, www.analysis-news.com has had several eye opening and frightening news reports of brewing trouble with pensions and retirement funds of all sorts (to include individual retirement funding programs). For those funded by the US government, like with social security, the US simply freezes out any COLA adjustments; meaning that the inflationary depression we are now under hits these persons extremely hard (the government keeps its COLA payments down by manipulating inflation statistics and telling the gullible people that there is little or no inflation).
For other persons in state and private pension funding arrangements, and people using individual retirement plans, their investments and sources of funding are drying up and vanishing as the depression intensifies and takes its toll on society.
While most government and private pension funding arrangements and individual retirement plans have not yet totally collapsed, they are as a minimum teetering on the brink and about to go down the tubes. This Goldsmiths will now go on record and suggest that all of them linked to the United States/the US dollar for funding will soon be worthless, in terms of benefits for their subscribers.
People living on pension and retirement funds are soon going to be in the have-not category as much of the rest of the population is now in if they are not already there. Soon, retirees hoping to enjoy their sunset retirement years will find that they do not receive sufficient pension/retirement funds to begin to cover their needs.
Four things Can Happen to destroy all hope that Retirees have for their Futures
One, we may have a huge deflationary fall which would wipe out much of the source of the funding for their pensions and individual retirement plans. The stocks and other investments will collapse leaving nothing to be paid to their beneficiaries in retirement. Already, real estate has been hit hard and may face more trouble in coming days. While this writer personally doesn’t look forward to this option, some persons do expect this future. Therefore, this course must be on the table of possibilities.
Two
Two, we may have a hyperinflationary blow off which means that whatever retirees receive will not be enough to meet their needs. In conjunction with rising inflation, the dollar must and will start down dramatically in value. While some posit that the government will formally devalue the dollar, I take it that the Cabal will direct its puppet central banks to stop supporting the dollar (like the Rothschild controlled central banks in Europe, England, Japan, Canada, Sweden, and Switzerland). Actually, the dollar right now has very little support globally except for the Rothschild Cabal controlled central banks in the Rothschild controlled nations. Many countries around the world are rapidly abandoning the dollar.
Either way, with a formal devaluation or a trickledown effect by the central banks controlling the dollar index, the dollar will start to depreciate as inflation heats up. For social security and government retirements, the government will continue to lie about the inflation rate so there will be no COLA adjustments to keep up with rising inflation.
On the now evident trend, the National Inflation Association had a report on Apr 22, 2010 on U.S. Food Inflation Spiraling Out of Control. This report was based on the Bureau of Labor Statistics (BLS) of the Producer Price Index (PPI) report for March 2010. Food prices for the month were up by 2.4%, its sixth consecutive monthly increase and the largest jump in over 26 years. Some of the big increases on a yoy basis included fresh and dry vegetables up 56.1%, fresh fruits and melons up 28.8%, eggs for fresh use up 33.6%, pork up 19.1%, beef and veal up 10.7% and dairy products up 9.7%.
NIA said it believes that “a major breakout in food inflation could be imminent, similar to what is currently being experienced in India.” Going back to the situation on October 30th, 2009, NIA noted now that “inflation would appear next in food and agriculture, but we never anticipated that it would spiral so far out of control this quickly.”
The story added that food stamp usage in the U.S. has now increased for 14 consecutive months. There are now 39.4 million Americans on food stamps, up 22.4% from one year ago. The U.S. government is now paying out more to Americans in benefits than it collects in taxes. NIA concluded that as “food inflation continues to surge, our country will soon have no choice but to cut back on food stamps and other entitlement programs.”
Noting that rising food and gasoline prices accounted for 58% of February's year-over-year 3.85% rise in retail sales, NIA “believes price inflation is beginning to accelerate in many areas of the economy besides food and energy, and all increases in U.S. retail sales this year will be entirely due to inflation.”
The point of this is that with increasing inflation and soon to be hyperinflation, retirement benefits will simply not keep up with price increases, even assuming that the retirement payments can continue at the present levels. Frankly, I don’t think they will continue at the present levels. But even with this assumption, retirees will be in a fix trying to make ends meet with the accelerating inflationary demands. Retirement funds denominated in gold and some hard currencies will do better (assuming that the government does not confiscate them).
Three
Three, we may have a combination of both inflation and deflation and certainly in the immediate future. We may have eventual hyperinflation in the market place but deflation in stocks and pension financing because of government cut backs on spending and funding (even more than lying about the inflation rate); and certainly state and local government pension funds will dry up (the public is already to the point of over-taxation; so how can more taxes be an answer). Even private pension funds and individual retirement plans will fall or collapse in their investments to produce a condition where they will have little or nothing to pay out to beneficiaries.
Frankly, this is my best projection for the future. I submit that the Cabal will continue and intensity its deflationary efforts though it won’t do anything with prices. The Cabal efforts to deflate the economy will only translate to more layoffs and more business and credit contractions. But these moves won’t change the inflation picture which will eventually take off like a rocket ship to outer space.
Four
And/or four, the US government is trying to force state government and private pension funds to buy US Treasuries (since the government is finding it harder and harder to sell its IOU paper elsewhere). If the government can sell its debt paper to state and local government retirement funds and private pension funds (and perhaps even individual retirement plans), it will put all of these retirement plans in the same boat as social security and other existing US retirement funding.
In other words, the government will continue to freeze out any increases in the funding for retirements all the while inflation intensifies to the hyperinflation level. Even if pension funds buy supposed inflation indexed bonds, the net effect will still be zero because the government will lie to bond holders and keep the inflation index rates substantially below the real world rates in order to avoid having to recognize the true rate of inflation. Thus, bond holders will be just like social security recipients. The government is not going to pay either of them what they should pay based on real inflation rates.
The Bottom Line
Either way, retirees looking for retirement and pension funding will wake up and find that they don’t have any pension or retirement funds as needed to cover their needs. This eventuality will undoubtedly materialize in the US, Britain and so-called White British Commonwealth states (of Canada, Australia, New Zealand, etc).
Possibly other parts of Europe and Asia might fare a little better and especially if their retirement provisions are held in some other funding source than the US/US dollar (like in gold or hard currencies). As far as most of Africa, we can forget them in terms of retirement funding for their people. Most African states can’t even feed their people much less do anything constructive on their retirement needs.
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-- Posted Friday, 30 April 2010 | Digg This Article | Source: GoldSeek.com