-- Posted Wednesday, 5 December 2012 | | Disqus
By Theodore (Ty) Andros
· Misery Spread widely
· Recipes for disaster and opportunity
· Fingerprints of RECESSION
· Truth and Consequences
The verdict is in and the man-made disaster that is creeping socialism just got a green light in the world’s largest economy! The SOMETHING for Nothing society known formally as the United States of America and controlled by what Vladimir Lenin called USEFUL IDIOTS (products of centrally controlled public schools taught the VIRTUES of socialism as beneficial) have now elevated their chosen REPRESENTATIVES as slave masters (at the point of a government GUN) to the last vestiges of the private sector that still produce more than they consume.
The TAKERS (people who consume more than they produce) of our society now own the MAKERS (people who produce more than they consume) lock, stock and barrel. This is a recipe for ECONOMIC and SOCIETAL failure which will ACCELERATE from this point on.
Many progressives and government agencies have told us Clinton-era taxes don’t matter while ignoring all the other issues that have changed since his presidency. Like a 50% PLUS increase in the federal regulatory state and the approximate growth of government by OVER 100% since he left office!
"A great civilization is not conquered from without, until it has destroyed itself from within. The essential causes of Rome's decline lay in her people, her morals, her class struggle, her failing trade, her bureaucratic despotism, her stifling taxes, her consuming wars."
– Will Durant, The Story Of Civilization III, Epilogue, 1944
Read that quote very carefully as it is the description of the developed world today. In just the last 90 days 6100 regulations where inserted into the federal register and since the election more than 1,900,000 million acres of oil and gas shale on federal lands have been removed from energy development. They just happen to be the most abundant areas for energy development.
Bureaucratic despotism is looming large with over 80,000 PLUS pages a year in NEW REGULATION in the first four years and unbridled creation for four more. Prosperity, capitalism, competition and innovation PROHIBITED by LAW! Take a look at what small business identifies as their most pressing problems (courtesy of www.pdgraaf.com - this is a fabulous newsletter and I subscribe to it):
Wow a bull market in PROGRESSIVE government sponsored pain to entrepreneurs, small businessmen and JOB creators since the chosen one was elected. Obam@care, Dodd Frank and the stimulus bill (expansion of government by 25% since 2008 when the chosen one was elected) are now IRREVOCABLY enshrined in STONE. This bull market is set to EXPLODE higher!
As their tentacles reach deeper and deeper into the economic fabric of Amerika they will SQUEEZE the life out of their respective purviews and enshrine political controls over practical policies. Also known as Bureaucratic DESPOTISM. They are Chicago- and Illinois-style political corruption brought to the national stage. The results will be the same! Collapsing economies and exploding insolvencies, just like ILLINOIS…
Now those (BAD) things are in the process of changing human behavior. As the takers FEEL the pain as it will ALWAYS ratchet higher until they change their thinking, actions and their support for socialist welfare government. For the makers it will be reflected in a capital strike until central government bureaucrats reverse course and confiscatory taxes and DESPOTIC regulations are ROLLED BACK!
As an Austrian economist I actually BELIEVE the fiscal cliff must be implemented and ADD more SPENDING CUTS to restore the potential for MORE sound money (rather than less sound)and the growth potential of the USA. If not cut government and deficit spending now, the question becomes when? The Answer is NEVER as long as leviathan governments and progressives control both sides of the debate (republicans and democrats, Tories versus liberals, etc.).
The left and the right are the Gotti’s and Gambino’s fighting turf wars known as elections to see whose special interest supporters get the front row FLEECING the PUBLIC and private sector. Crony capitalists play BOTH sides of the isle.
Just today a parade of trade unions and hard core socialists (UAW, AFSCME, AFL-CIO, SEIU, moveon.org and several more) are visiting the WHITE HOUSE to decide how they will carve up the public purse and political opponents. A wall street journal report today reports the outcome was DON’T BLINK, take the money from the private sector and give it to US. WE put you back into the driver’s seat and now it’s time to pay your supporters with plunder taken from the VANQUISHED.
The next parade of crony capitalists at the WHITEHOUSE then emerged led by Warren Buffet and the CEO’s of the largest companies in the USA. Most of whom dodge the taxman almost entirely through earlier regulatory and tax favors bestowed to them from previous episodes of lobbying and campaign support (disguised bribery). Supporting the president in socking it to the small businessmen who really drive the economy and cannot weasel their way out of paying taxes as individuals.
The chosen ones most senior advisor is a woman named Valerie Jarrett. An old style Chicago gangsta politico. Here are her own words on what lies ahead:
"After this election, it's our turn. Payback time. Everyone not with us is against us, and they better be ready because we don't forget....the ones who opposed us will get what they deserve...there will be hell to pay. Congress won't be a problem for us this time...No election to worry about after this is over, and we have two judges ready to go"
– Valerie Jarrett, Obama's closest and most senior advisor, during a recent meeting with the administration's senior staffers.
Echoing the chosen ones comments Dmitry Medvedev Russian president to Vladimir Putin about more FLEXIBILITY after the election also known as selling out the American people’s security. He was referring to missile defense, but it applies to everything.
This is arguably the most powerful woman in the world unbeknownst to many; the president does whatever she and Michelle tell him to. Do you think that signals an era of bipartisanship? Compromise? If it didn’t happen after the 2010 election don’t expect it NOW! Now let’s look at another confidant’s recent comment:
"All whites are going to hell."
- "Rev." Joseph Lowery, Obama confidante and pastor
And the chosen one himself
"Vote for revenge!"
Progressive Corrupt supermajorities have emerged in Illinois and California state governments, and now the collapses will accelerate in those places as well. Both states are DROWNING in RED INK and totally and completely operating in INSOLVENCY. NOW completely unconstrained by the checks and balances of government their drive to GREEK like debacles will accelerate. Look at this quote from the governor of California:
High-income earners have more to fear from their spouses than they do from taxes in California,” he said. “Usually it’s because they are going through a nasty divorce. So as long as they take care of their relationships, we will take care of spending their money wisely.”
California’s legislative leaders are talking about an EXIT tax for wealthy citizens trying to escape…er…move out. These REALITIES are going to hit the economy and YOU like a brick. The FEDERAL deficit is supposedly about 7% of GDP according to the office of the treasury:
The fiscal cliff (huge tax hikes, REAL cuts to defense and imaginary cuts to spending) is what was intended from the very beginning of the current progressives which control Capitol Hill. They just did not want the blame for unpopular LIBERAL/SOCIALIST policies, so they devised a plan where no one and everyone are to blame. It is a HUGE MIDDLE CLASS TAX HIKE! Of course, that is where the big money is…
It’s about 4 dollars of new taxes for each dollar of spending cuts consisting 50% from defense (REAL cuts) and 50% (FAKE cuts) from the executive branch. Academic studies and Simpson Bowles recommend 3 dollars of spending cuts to one dollar of NEW taxes. This is the OPPOSITE! US politicians are following Eurozone peers rather than respect HISTORY. A recent Barons sums up what is about to be IMPLEMENTED on the tax side:
This is Washington DC’s greatest WISH, not to be avoided but to be implemented in all its glory with themselves and their corrupt supporters as BENEFICIARIES. $506 Billion dollars LOOTED from the private sector (on a YEARLY basis) and transferred (as a lump sum) to GOVERNMENT consumption, misallocation and capital destruction under the direction of socialists and crony capitalists within the Beltway. This is the beltways RECIPE for growth! Growth of government and dependency.
Now the progressives and the main stream media have made a BIG mistake. They have labeled what they have LONG dreamt (massively higher taxes, more defense cuts and postponement of spending cuts) improperly and the masses don’t understand anything but one word definitions and they and the main stream media have labeled it in a threatening manner “Fiscal Cliff” so the masses are AFRAID. These fraudsters prey upon public FEAR. Scaring the public then seizing power to PROTECT THEM then preying on them as their FREEDOM and WEALTH is CONFISCATED.
BIG GOV’T Progressives WANT massively higher taxes and regulation, and are quite happy to cut defense. Just look to Europe where the armed forces are antiquated and a pale shadow of their former selves. National defense is a NATO (read US) responsibility. The MAIN PROBLEM of RUNAWAY Entitlement SPENDING are left untouched. THIS IS WHAT THEY WANT AND DREAM OF, unfortunately it is labeled the DEVIL in the public’s mind. POETIC JUSTICE: HA HA!
Deficit spending is just another word for PRINTING MONEY (out of thin air) and must be recognized as such. Spending our and our children’s future income TODAY. Now that is absurd and IMMORAL. The Federal Reserve is BUYING $85 trillion a month of worthless Government and Mortgage backed securities and that will NEVER change again. The FINANCIAL and CURRECY CRISIS will only accelerate from HERE until the ultimate denouement.
While I DESPISE centrally planned progressive Leviathan government, the welfare state, the chosen one, and his PROGRESSIVE minions, it is only POETIC justice that they WILL BE HOLDING the BAG when the FINAL bill for their moral and fiscal insolvency ARRIVES; National and international BANKRUPTCY and societal chaos as seen in Greece, Spain and Portugal.
This will be a very dangerous moment as anyone following the unbelievable parade of executive orders KNOWS they may try and seize power during the emergency and impose a dictatorship to PROTECT and SAVE you!
The USEFUL idiots (aka the public) don’t understand CAUSE and EFFECT as the 40-year KEYNESIAN purely fiat currency experiment nears its DEMISE. MITT and the Republican Party will thank their LUCKY stars that they are NOT the FALL GUYS for the ECONOMIC collapse that is continuing to unfold. In 2014 and 2016, no amount of media or government spin can deflect that progressives have been in charge for 6-8 years.
When the Bush tax cuts expire, Dodd Frank is implemented, and the OB@MACARE taxes kick in the public will KNOW what they have voted for, for the first time in over a decade THEY will feel the PAIN and the cost of bigger government.
Once the pain arrives the liberal jig is up and the chosen one will be revealed for the socialist he is. Because he is a blind ideologue you can expect no compromise going forward. In fact, partisanship will be worse than ever. So it’s NO SPENDING cuts and MUCH more TAXES, with the main stream media confusing and demagoging the issue to the public at large.
PAIN is an important part of human behavior: it induces changes in behavior. When you shield the public from the pain of their poor electoral choices than they don’t get the signal to vote for smaller government or understand the costs of not doing so to themselves.
The only pain they get at this point is the pain from the invisible tax of INFLATION. Now they will get a glimpse of what they have voted for in 2008, 2012 and their weekly pay stubs. As they recoil in HORROR expect the pitchforks to emerge. It will be quite a big wakeup call as millions who fell off the TAX ROLLS are put back on them. Take a look at the breakdown of who pays what from a recent www.nytimes.com:
Can you imagine the pain of a family of four when their incomes are REDUCED by the figures above? With the public and middle class as modern day serfs, tax & debt slaves how many debts or provisions for the future (savings) will NOW go UNPAID as government confiscates MORE of their wealth? The mortgage, the auto payment, the kid’s schools, insurance, retirement savings, which will get the heave ho?
Quite a bit of the mischief and pain from the stimulus package, the affordable care act and Dodd Frank where postponed till after this presidential election to FOOL the public into continuing support. Now since the election is over they can emerge as the economy killers they are.
A recent Wall Street Journal outlined what’s to come in the banking and financial service industry:
“According to a Davis-Polk analysis, only 133 or 33.4% of the 398 rule-makings the law firm estimates Dodd-Frank requires have been finalized. The law is ambiguous and other reviews suggest the figure could be closer to 500. As of November 1, some 132 rules haven't even been proposed, while the government has failed to meet 61% (or 144) of Dodd-Frank's legal deadlines.”
- Wall Street Journal
Those MAJOR rule makings cost $100 million or more times 500 equals at least $50 billion out of the banking sector and into compliance costs which produce NOTHING. The EPA and energy department will be resuming its wars on inexpensive conventional energy such as Oil, Natural gas, and coal. You can expect less of it at astronomically higher prices. Here is the Chosen one in his own words telling you what his plans are. They haven’t changed I promise you.
Click here for video.
It is their solution to making CLEAN energy affordable by making conventional energy EXPENSIVE. This is the genius of socialism, crony capitalism and misallocation of resources to new heights of absurdity.
Here’s a quote from Thomas Donlan of Barrons:
Some issues are settled. Obamacare will shake up one-sixth of the economy, if the bureaucracy can make it work. The Dodd-Frank law will rule financial services, again if the bureaucracy can make it work.
- Thomas Donlan
Of course the bureaucrats will fail and with their failure so will the healthcare, energy industry and financial systems. They have failed with the post office, social security, the public schools, Medicare, Medicaid, energy policy and everything else they have taken charge of to PROTECT you!
Central Planning run AMOK, devised by Washington DC (District of Corruption)
Please tell me one of these areas were there has been improvement while in government hands. Prices have exploded and quality of product has DECLINED; now we can add private sector healthcare and the financial system to their VICTIMS list.
Now the USEFUL IDIOTS will find out the true costs of supporting socialism and government control of the private sector. It’s called the NEXT LEG DOWN IN THE ONGOING DEPRESSION.
Over the last several newsletters we have been showing the fingerprints of tops in the markets (complacency, long-term vix), exports order crashes. Now we see the next steps on the game of dominoes known as the next leg down in the ongoing depression.
Now we will be looking at, Eurozone credit growth/contraction, US capital spending and GLOBAL industrial production. Key leading indicators which are signaling DANGER ahead. First let’s look at credit growth in the Eurozone from 2004 through September 2012 courtesy of the New York Times:
If credit is not growing than neither are these economies. Eurozone banks will be SHRINKING their balance sheet for years to come as leverage fails. More misery to follow. Now let’s look at US capital spending courtesy of www.wsj.com:
Those are canaries in a coal mine and they are signaling the ECONOMY has stopped growing, big corporations have lost confidence in the future and independent businessmen cannot rise above the double top shown. And this is also reflected in this chart of business profits versus revenues. REVENUES are falling off a cliff and you can expect sales to follow. Take a look at the chart from www.zerohedge.com these two measurements are HIGHLY correlated:
Revenues/sales are in free-fall and earnings are sure to follow. Now know why layoffs are skyrocketing in the last several months and gone into orbit since the chosen one has been REELECTED. What does industrial production do to confirm other indicators (illustrations courtesy of the New York Times and www.wsj.com):
These are year over year numbers and put official GDP numbers to the test. REAL growth has gone the way of the DODO bird. Only one economy has fractional growth: the United States, where the ministry of truth has been supporting the chosen ones REELECTION with official MISINFORMATION.
In Closing: The DEVELOPED world is now firmly in the hands of something for nothing constituents and their socialist masters in their respective capitals. As the economies they inhabit cascade lower under their policies past, present and future misery will be spread widely. Misery spread widely is the product of socialism as real growth DISSAPEARS and Money printed out of thin air fills in for the lack of income growth.
It is paid for in a variety of ways but the bottom line is the money you are paid and store your wealth in buys less and less while you balance in the bank stays the same. As politicians loot and plunder the private sectors to pay the unpayable promises and support those that don’t produce by enslaving those that do for the CRIME of leading a prudent and productive lifestyle. Creating DISINCENTIVES to do so in the present and future.
As the economic and societal implosions unfold more and more of the private sector and freedoms will be seized to SAVE you. It is only beginning.
The Fiscal cliff is a bogus issue. Think of the absurdity of our leaders in the public and private sector viewing living within their means as UNTHINKABLE. Never ending borrowing and spending to expand government and control YOU. The developed world is now dominated by something for nothing societies and the public serpents...er…servants that reflect them. A ride over the cliff was the plan in the first place.
(Author's note: In my opinion, this is NOT Doom and GLOOM, it is one of the greatest opportunities in HISTORY. Invest properly for this outcome and Prosper, invest looking in the REARVIEW mirror and your wealth will be irreparably DAMAGED. Volatility is opportunity for the prepared investor. As it is priced in and markets ZOOM higher or LOWER to price in collapsing economies and money printing huge opportunities are created. Is your portfolio structured to thrive? The greatest transfer of wealth from those that hold it in paper and financial assets to those that don't is UNDERWAY. Restoring fiat currencies to sound money and absolute return alternative investments with the potential to thrive in all market (up, down and sideways) conditions is what I do. If you have an interest in learning more and working with Ty: CLICK HERE
What was a TEMPORARY capital, investing and job creating strike by the private sector in the United States BEFORE the ELECTION will now become a PERMANENT one. Small business is done and will not revive under the current administration in Washington DC (District of Corruption), or progressive states. In fact, their hell just got a LOT WORSE! They stand to be absorbed and PUT out of BUSINESS by politically connected crony capitalist’s ala the “CHICAGO” way.
The chosen ones goal is not to spur ECONOMIC growth and job creation. It is to foment ECONOMIC collapse, grow government DEPENDANCE, gather power as the man-made disaster unfolds, gather power, take freedoms and REDISTRIBUTE what wealth is left to the special interests that who put him in charge. Google the words: Cloward-Piven strategy for more info.
The PROGRESSIVE government PYTHON has and is finalizing wrapping itself around and throughout the PRIVATE economy, now it is about to squeeze the life out of it!
The banking, finance and healthcare industries will be Unrecognizable to you in four years. If you are a supporter of BIG government you will be helped and if you aren’t YOU won’t! Declining living standards and people at each other’s throats will continue to escalate as poverty unfolds. Societal Chaos looms. Do you live in a gated community?
“Lift Debt Limit to Infinity" Treasury secretary Tim Geithner
You can expect an unlimited debt ceiling to be enacted SOON with no spending reforms implemented. The printing presses are about to go into HYPERDRIVE!
Fed monetization cannot be withdrawn without causing a collapse of insolvent governments and the financial system. What will happen if the Baby boomers do not escape the future with their stock, bond and real estate wealth?
In purchasing power terms they have ALREADY lost 75-80% since 2000, now the elites in charge will TAKE the rest of it by doubling down on their disastrous policies… This is HISTORY REPEATING and a HUGE opportunity to those that embrace it and a huge loss to those that don’t…
Thank you for reading TedBits, subscriptions are Free at www.Tedbits.com or www.TraderView.com, may God Bless you!
Ty Andros / TraderView – Gold & Silver Backed, Absolute-Return Alternative Investment Specialists
7800 Southland Blvd. #110 Orlando, FL 32809
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-- Posted Wednesday, 5 December 2012 | Digg This Article | Source: GoldSeek.com