Elaine Meinel Supkis
China has sent us a very loud warning. If we default on our many billions in debts to China, there will be a blinding, hideous retaliation. I expected this would happen after the Olympics closed with China taking the lion's share of gold medals. We look back to a year ago to see how this present banking collapse was proceeding last August. And we look at August, 1930. Similar situation! Not unexpectedly. The US empire is bankrupt. Biden was chosen to herd Obama into office. Biden's son is a credit card lobbyist. Arrest everyone. The Bushese are even more corrupt: they are owned by the Chinese and Saudis. Today is a grim day after a grim year. The US empire is dead but still rolls onwards due to inertia and fear.
First, we visit Culture of Life News exactly one year ago:
In the famous movie, 'Rashomon', four different people tell four different stories about a rape/seduction/murder. The present economic meltdown is similar: so many people are lying or concealing stuff, it is very hard to sort out what is true, what is fake and where this will end except I know it will end badly. We have had a philosophy of global trade/global banking for quite a few years now yet many people trying to make sense of this latest...and not so unusual...banking collapse tend to overlook key players and misunderstand key philosophical banking issues. China and Japan are NOT playing the same game or using the same rules Europe and the USA use.
The bizarre financial systems we see today was set up in the West, with the collapse of communism. When communists coupled their own, new system with the Cold War economic alliance which was set up so that the two losers in WWII could hyper-prosper, thus has created a New World Order that is totally insane and utterly impossible to sustain. The US was persuaded to rebuild the communist empires. The thinking was, if they became stronger and more capitalistic, they would become friends of the US.
This infantile way of thinking is due to propaganda put out by the elites, themselves. The grave danger of all propaganda is, one ends up believing the fake stories. This is why a cold-eyed look at reality is necessary. History never was a conflict between economic systems. It was and still is a conflict between EMPIRES. Empires have been founded on every possible sort of system, style, philosophy and economics. But they all have many, many things in common. This is why recognizing the history of empires and the dynamics of domination are more useful than dickering over details.
The old article from last year is important reading. In it, I tried to explain how the collapse which had barely begun last August, would evolve. I knew this was a major, major global banking collapse due to too much lending, too much overspending. And I knew that the key to all this was in the US global empire: the US was already bankrupt. No one wants to admit this. Everyone wants the US to continue paying its debts. The last thing they want is for the US to do what Germany did in 1933: totally default on all international debts.
Just as the US tried, from 1923 onwards, a desperate stream of continuing lending to Germany to keep their economy afloat so Germany could pay WWI reparations and therefore, fund England and France's repayment of loans from America to run that ruinous war. The collapse of this circle of higher and higher lending coupled with a flood of foreign savings pouring into the US markets from 1922-1929, destabilized international banking and commerce. Which was still, despite the bankruptcy of England, run on the English currency as the base.
Note here how empires run along as if they are alive and well, long after they have died! This is a characteristic feature! Important as all hell. For dead empires always keep moving from sheer momentum. Electrical shocks are applies to keep the dead beasts going and they go and go. The Ottoman Empire, locus of WWI's energies, was dead in 1750. But all the European rising empires kept it alive because they were competing with each other over dismembering that older empire. The whole thing finally came apart in 1914 when the heir to the Viennese throne was assassinated. Now, the Ottoman Empire is a small rump, Turkey. And the rest is being shattered into ever-smaller slivers.
England sailed merrily along after basically being destroyed in WWI. But when the Japanese and Germans poked at the paper tiger of bankrupt England, it all collapsed so fast, the armies and navies of Germany and Japan could barely keep up. The 'Blitzkrieg' aspect of all this was due to the utter collapse of English power.
The US empire is DEAD. Yes, dead. Not totally in the grave...yet. But it is financially dead. The military will follow suit. Our only solution is total warfare, I fear. The summer conventions this year are very dark indeed, as I will explain later. Back to money matters: neither candidate has the solution to our financial destruction since both support wild military overspending. And we are bankrupt. This is part of the international instability. The US cannot pay for the empire we saddled ourselves with. We can ruthlessly cut off our free protection services to Europe and Japan! And we might survive our own collapse.
But this option is not allowed. Unlike in the 1930's when the Asian and European powers wanted us to eat their bitter war fruits while they invade our markets, our own nation took severe measures to withdraw and protect itself. This may have caused WWII but I would state here that we would have LOST WWII without a single bullet being shot if we took up the burden of the entire French and English empires! There was no way we could afford that. Nor would it make any sense. Later, when we tried this in Indochina, we were thumped, hard. At least with WWII, both England and France had to surrender significant degrees of autonomy in order to have us rescue them from the messes their dying empires created.
Losses expected to double, while Fed remains under microscope
(MarketWatch) -- The financial crisis has entered a new phase and will likely bring total credit losses above $1 trillion, according to a leading academic who has been studying the turmoil since its beginning a year ago.
Princeton University economics professor Hyun Song Shin says the subprime mortgage crisis has already cost financial institutions roughly $500 billion. Now, however, the problem has spread to the real economy, and losses on credit cards, consumer and business debt should match or exceed those from subprime mortgages and the like, he said.
"We'll see as much as the subprime losses again on the other side, at the very least," Shin in an interview Saturday with MarketWatch on the sidelines of the Federal Reserve's two-day annual economic seminar in Wyoming.
The International Monetary Fund has estimated that financial institutions will suffer a total $945 billion in credit losses. Shin said that remained a credible number, but was still probably on the low side.
"We are probably half way [through the financial turmoil], "Shin said. "The first stage is done -- we're at the second stage. ... The real issue is how much is how much the prime mortgage portfolio is going to be affected. That is going to depend on how far house prices will fall."
I wasn't invited to this picnic. So I will hang out with the grizzly bears outside the Jackson Hole fences and yell at them all: 'Hey, you guys are supposed to be EXPERTS and some of you dudes even claim to be experts about the Great Depression! So why are you guys all so utterly clueless?' I am happy that this one intellectual giant can see part of the truth. About time. Yes, indeed, we are in the 'second stage' of this epic banking collapse! Wow.
Um, this being year 2 in the collapse, I have been running past postings on anniversary days to show clearly, where we were a year ago and where we are going today. It is striking! The Second Great Depression or GDII is an echo of the previous one just as WWII was an echo of WWI. The Great Depression II is going to probably be worse than the previous one just as WWII was worse than WWI. The British Empire was big. But the US empire dwarfs that. England didn't have troops in the majority of the world's countries. The English economy didn't overwhelm all other economies. The expenses for running the British Empire were far less than the epic hemorrhaging of red ink by the US during times of low-level colonial wars.
Enraged mobs might wipe out British interlopers in India or China but were helpless when fairly small armies with little equipment were hauled in to kill civilians or poorly-paid native troops. The US occupation of hostile territory, on the other hand, is tremendously expensive. And deliberately so. The US military is very anxious to spend as much money as humanly possible, as fast as they can. This is immensely profitable.
And we are bankrupt. The fact that our entire financial system is collapsing as fast as the World Trade Center fell on 9/11 is significant. For they are one and the same. The people who benefited most from that attack were our military/industrialists and the global revolutionaries seeking to destroy US economic powers.
The housing bubble was launched because the US emperor, Bush, wanted Americans to be enthusiastic about widening the empire and overspending on wars. Instead of a punishing rise in taxes and restrictions in trade, the US tried the usual imperial solution to pesky revolutionaries: throw money out the window to the masses. This created global inflation. And destroyed international values, trade and banking. Not the act of buying those stupid houses, it was blasting that huge hole in the Cave of Death so we could get rich, killing civilians far away. If everyone in America paid their debts, the #1 debt to pay is to pay taxes to cover the costs of war. Since war money flows OUTWARDS, this is a much greater danger to our financial welfare than social services. Social services are INTERNAL. War is EXTERNAL.
We became stronger after WWII because despite external flows of goods and money, we taxed ourselves to the hilt to pay for this. But since wages and jobs went up due to the dominance of the US in industrial output, all was in balance. Today, we are a global industrial MIDGET. And what production we now have, increasingly, it is owned by the people we defeated in WWII or defeated in the Cold War!
(Bloomberg) -- A failure of U.S. mortgage finance companies Fannie Mae and Freddie Mac could be a catastrophe for the global financial system, said Yu Yongding, a former adviser to China's central bank.
``If the U.S. government allows Fannie and Freddie to fail and international investors are not compensated adequately, the consequences will be catastrophic,'' Yu said in e-mailed answers to questions yesterday. ``If it is not the end of the world, it is the end of the current international financial system.''
``The seriousness of such failures could be beyond the stretch of people's imagination,'' said Yu, a professor at the Institute of World Economics & Politics at the Chinese Academy of Social Sciences in Beijing. He didn't explain why he held that view.
China's government hasn't commented on Fannie and Freddie.
The Olympics are over. After the West earned the Gold Medal in Whining About The Hosts and after the US got the Gold Medal in Sneak Attacks On Russians, we are entering a new system today! The news from China is very dire. The Chinese are losing patience with the US. They held off slitting our economic throats due to the anticipated Olympics. But the US and NATO did a dual attack: they continued to demand the dismemberment of China while attacking Russia's borders.
China and Russia are solvent. The US is bankrupt. Now, China 'be bank'. Frankly, the Chinese are NOT shocked about the US going bankrupt. THEY PLANNED THIS. They knew that if they held the keys to the bank vaults, they could strangle the US. This silence from Beijing is not stupid. It isn't from annoyance. It is PART OF THE PLANS.
Few people believe me when I say, this plan was cooked up in the US back in the 1980's when the Chinese finally understood capitalism and saw clearly how the US had gone off the financial cliff after the Vietnam War. The US ruling class cannot claim they had no idea the Chinese figured things out. I told everyone until blue in the face, what was going on. Bush Sr. wanted to be ambassador to China back in the seventies because he knew he could make a financial killing and in addition, get Chinese support for getting more power in America.
For Bush was head of the CIA before hiking off to China to get rich. He had all the inside information from my mom and dad. It was my mom and dad who suggested to the CIA, they have the Chinese officials live in my house, for example. We all know each other. Just as I knew Moynihan and D'Amato when they were the Senators for New York. All of them knew about China and China's desire to get a grip on capitalism so they could make their empire stronger. They also knew of the Chinese cynicism about bribery. After all, they spied on Bush when he was ambassador! And they were VERY inquisitive when it came to spying, by the way.
For example, once when my mother and father wanted to talk privately, they went into the shower. A frustrated Chinese agent burst into the bathroom, demanding they stop it, now. This was during Madame Mao's days.
China's silence today is tactical. Being very aware about the entire issue of 'face', they send out courtiers to step forwards and issue threats and demands. Only these are 'suggestions.' The Chinese have made it utterly clear, the US cannot fob off all losses onto China. If the US does this, unnamable horrors will occur. I have said in the past, the rulers of China won't hesitate to whack us very, very hard. They don't want an army of super-rich in China, either. They want to balance state power with private power. Unlike the US which has utterly divorced the people from the power at the center, handing it over to the hyper-rich. Both alien and domestic. The Chinese want to use Bill Gates, not create him.
The international financial systems are broken. They cannot be fixed unless the oath breaker, the US, resumes fiscal responsibility. None of the US allies, Japan, Germany, France or England, want this. They need to keep the US misspending money protecting THEM. Even as they poke at Russia and China. Every tiny principality and statelet also wants this. They can all call upon the US to protect them while they roar defiance to their neighbors. Gads. So instead of us turning aside from this bankrupt situation, it increases. All the war bellows we will be hearing at the Conventions will confirm this to the Chinese: the US thinks it will have enough money from Europe and Japan to keep going.
THIS IS FALSE. If Europe and Japan can fund the US empire, it will be only for a few more years, if that. And only if the US keeps away from conflicts with Russia and China over other nations such as Georgia or Iran. If we insist on confrontations, they will give this to us. By bankrupting the US. If Europe and Japan want to buy ALL the US dollars and debts held by Russia And China, they can! BE MY GUEST. Try keeping the dollar 'strong' while buying up $3 trillion in communist held US debts and dollars!
THIS IS IMPOSSIBLE. They could do this by getting loans from each other. This will increase global inflation, of course. We tried this after losing the Vietnam War. Unlike in 1980, the US can't scare Saudi Arabia into our embrace. The kings were terrified of communists. But now, they are terrified of the bin Laden religious revolution. Which has not died. It is stronger than ever and eating up Pakistan pretty rapidly. It has defeated the US. We just won't admit this.
Both China and Russia can protect the Saudi royals. As the US collapses, the Saudis are already being hammered by US financial losses. If the US goes bankrupt to China and Russia, ALL OTHER SYSTEMS WILL FOLLOW SUIT. This is unavoidable. We can't do a selective bankruptcy. If we cheat the Saudis out of their oil profits just like we did in the 1990's, they will rush to China and Russia for help and protection. And they will join them in basically suing the US for past financial damages. Using the UN. Which still exists. And will be run by a consortium of holders of US debts. Trust me on this.
So why has the dollar climbed 7 percent against a basket of currencies since July 15? It is all relative. The outlook for the American economy may be grim, but that of the rest of the developed world is deteriorating rapidly. "This spreading weakness abroad - and it is worse now in Europe and Japan than it is in the U.S.A. - is the primary reason for the dollar's recovery," said David Rosenberg, an economist at Merrill Lynch.
Data released Friday showed that Britain's economy did not grow at all in the second quarter. The euro zone recorded its first-ever contraction during that period.
Revised figures due Thursday are expected to show that the U.S. economy grew at a solid 2.7 percent annual rate in the second quarter, according to economists polled by Reuters, well ahead of the 1.9 percent pace that was initially reported.
But don't expect much of a celebration on Wall Street, because few investors believe this pace can be sustained. Ironically, the recent resurgence in the dollar is part of the reason why.
For the global economy, a strengthening dollar is a mixed blessing. It is good news for European exporters, who have long complained that an expensive euro was hurting their business. It is not such great news for the U.S. economy, which has relied on export demand to compensate for sluggish domestic spending.
Indeed, foreign trade added 2.4 percentage points to second-quarter U.S. gross domestic product, its largest contribution in nearly 28 years, according to calculations from the research firm Global Insight. The revised data Thursday may show that it provided an even stronger kick of 3.2 percent. In other words, without trade, the second-quarter GDP figure could very well have been negative.
If we subtract the US budget deficit for this year which is rapidly approaching a trillion dollars and subtract our trade deficit, the 'growth rate' falls to well below zero. Goosing our economy with that $600@ gift to US tax payers worked. But it increased our debts to China and Russia. So it simply made our situation worse. No sane human overseas is fooled by our GDP figures. Besides, some of this was due to the sudden hike in US exports when food and fuel shot up. The US exports lots of food.
EXPORTS IN AUGUST ABOVE JULY TOTAL;
Amount, Though, Is Far Below That of Month in 1929--Imports Lowest in 10 Years.
DRIFT OF GOLD CONTINUES. Steady Stream of Money Metal Flowing From Country Lately-- Silver Movement Shrinks. Foreign Trade in Merchandise.
One year after the fall in stocks in 1929, this was the headlines! How similar it is today! Metals of all sorts are flowing out of America. I get emails and see stories in the news about the inability to buy gold or silver in physical form. See how this was happening in the past? Imports were lowest and look at today: our government is boasting that imports are down. Japan and Europe can't save the US finances if they are losing the ability to export to the US. This is part of the deflationary liquidity trap.
Offerings of Stocks and Bonds Total $236,250,000, Against $564,739,000 in July. SALES OF SHARES ARE FEW Most of Lien Securities Put Out In Last Eight Months Are of Public Utilities. Offerings Show Big Changes. August Offerings Are Compared.
Looks like today's news. Now, back to today:
(Bloomberg) -- Merrill Lynch & Co., Wachovia Corp., Lehman Brothers Holdings Inc. and the rest of the U.S. finance industry are about to find out how expensive credit has become.
Banks, securities firms and lenders have a record $871 billion of bonds maturing through 2009, according to JPMorgan Chase & Co., just as yields are at their most punitive compared with Treasuries. The increase in yields may cost them as much as $23 billion more in annual interest versus a year ago based on Merrill Lynch index data.
Higher refinancing expenses will restrict the ability of banks to borrow in the capital markets and lend, further cutting off credit to consumers and businesses and curbing what is already the slowest growing economy since 2001. Standard & Poor's said last week that it had a ``negative'' outlook on almost half of the 50 highest-rated financial institutions in the U.S. as of June 30, the highest proportion in 15 years.
Even as the bigger bankers are paying more and more to access money, thanks to the Federal Reserve cheating savers in our bankrupt nation, rates are rising for them. But not for savers. This is STUPID. And totally infuriating. The US bankers, instead of attracting savings, are BORROWING and doing this overseas. They used to go to Russia, China and Saudi Arabia for funds. But as we can see, these three entities are increasingly united in refusing us this option.
One trillion in bonds will be maturing this next year. Someone with money has to buy them. Who are these people? Will people being cheated out of their savings by the collapse of Fannie Mae and Freddie Mac buy these bonds? HAHAHA. NO. The minute we understand this, we have to get on our hands and knees and crawl to the Dragon Throne, the the Double Eagle Throne and to Mecca's rulers and head to the floor, beg for mercy. Is this being discussed?
NO! Not at the Teddy Bear Picnic at Jackson Hole. Nor was it discussed at the Bilderberger Meeting in DC. HAHAHA. Actually, it was. With fear and trembling. 'How can we kow tow without letting the peasant masses see this?' was what they said to each other. Once the proud flag waving, gun owning American peasants figure out, the ruling elites in America are fools and stooges of the communists and Arabs, they will revolt. If they think McCain isn't a stooge, well, they should watch the Three Stooges. He ain't Larry. He is the bald guy who crashes into walls.
Obama is being led by the hand in the art of kow towing while pretending to be Kennedy. Kennedy was at the apex of our power. Obama is at the nadir. The best we can hope here is, he is enough a gentleman to do this with enough grace, the real rulers in China, Russia and Saudi Arabia will allow him to pretend to be proud and not a beggar at their gates. But the advisors to Obama want to confront China and Russia. And hate Saudi Arabia. I don't see how any of this is possible, frankly.
During the years that Senator Joseph R. Biden Jr. was helping the credit card industry win passage of a law making it harder for consumers to file for bankruptcy protection, his son had a consulting agreement that lasted five years with one of the largest companies pushing for the changes, aides to Senator Barack Obama’s presidential campaign acknowledged Sunday.
Mr. Biden’s son, Hunter, received consulting fees from the MBNA Corporation from 2001 to 2005 for work on online banking issues. Aides to Mr. Obama, who chose Mr. Biden as his vice-presidential running mate on Saturday, would not say how much the younger Mr. Biden, who works as both a lawyer and lobbyist in Washington, had received, though a company official had once described him as having a $100,000 a year retainer. But Obama aides said he had never lobbied for MBNA and that there was nothing improper about the payments.
“Senator Biden has a 35-year record fighting for people against powerful interests, whether it’s drug companies, oil companies or insurance companies,” David Wade, a spokesman for the Obama campaign, said in a statement. “He took plenty of knocks from the largest employer in his state because he demanded changes in the bankruptcy bill. But legislating requires compromise. Senators cast tough votes. Congress worked on the bankruptcy bill for nearly a decade, over five Congresses, to forge a bipartisan compromise.”
ALL the teeming relatives of the Senate and other seats of power are lobbyists. 'Hey, dad, hey, honey, hey, gramps, can you sign this bill for my employers?' these flock of locusts babble. They are legion and they are a sign of corruption. Nearly everyone in DC is corrupt these days. Give them money, they give back corruption. The use of family members as lobbyists should be outlawed. Arrest them all! McCain has a paid lobbyist for Georgia where we just saw a sneak attack on Russia. These people are TRAITORS. I can't emphasize this enough. Corrupting the political system is treason. When our lawmakers are lawbreakers, we get a broken system. Broken systems go bankrupt. We are going bankrupt.
But it was 1980, South Dakota's economy was a mess, and suspicion was an instinct that Janklow could not afford. "We were in the poor house,'' he recalled. "It cost 42 cents a bushel in 1980 to haul wheat. When something's only selling for $2.20 a bushel, you certainly can't afford to be paying almost 50 cents a bushel to ship it.''
The calls were from Citibank, which was having a serious problem of its own. "It was very simple,'' said Walter Wriston, then the chairman of Citibank. "We were going broke.''
The bank had lost more than $1 billion on its audacious foray into the credit card business, and the future looked even worse. The trouble, simply put, was that the rate of inflation exceeded the amount of interest Citibank was allowed to charge its credit card customers under New York usury laws.
But the bankers saw opportunity and salvation in the plains of South Dakota. Within days of those first phone calls, a team of top executives arrived from New York with a proposal for Mr. Janklow: If South Dakota would quickly pass legislation that would enable Citibank to move its credit card operations to the state, they would bring hundreds of high-paying white collar jobs to the state.
The unlikely alliance would clear the way for Citibank to turn a money-losing credit card operation into a vastly profitable business. "All of their senior people used to say it,'' Mr. Janklow said. "That South Dakota saved Citibank. I believe it did. That South Dakota saved Citibank.''
Congress protects systems that are set up to bleed the US public dry. Everyone wants laws that protects this process and are willing to buy up all our political leaders to gain this. Citibank is always in the news. Despite this scam they pulled 35 years ago, they are still going bankrupt! They are basically owned by the Chinese and Saudis. Citibank is grossly overextended and hasn't near enough capital to stay alive much longer. All the tricky schemes to bleed money from the US consumer have failed, in the end. There is no going back. After bankrupting the consumer, the consumer can't consume. The scheme to flood the consumer market with new lending has now failed. The housing bubble was the last grasp at piling unpayable debts upon the US consumers.
Even if all the sons, daughters, wives, husbands, cousins, and other relatives beg Congress to pass bad laws, this won't bring in a flood of money to the sponsors of these craven family members seeking greater and greater wealth. Nearly all of Congress is multimillionaires now. The Clintons, when Hillary took office, were in debt. Then, over the course of just 7 years, they raked in over $100 million by selling Hillary like she was a political Monica giving blow.
The two candidates for President who were not multimillionaires were Kucinich and Ron Paul. Both were brutally muscled aside by the media. The media has a whole flock of relatives of the rich and powerful, working with or for them.
Iowa Gov. Chet Culver has some harsh words for an embattled kosher meatpacking plant that's accused of child labor violations and was the site of a huge Immigration raid.
It's an unusual move for a governor to knock a company that employs hundreds in a rural part of the state, but Culver said past violations and new allegations at Agriprocessors Inc. in Postville called for the criticism.
He published his thoughts in a guest column in the Des Moines Sunday Register, where he said Agriprocessors has "chosen to take the low road in its business practices." Culver also charged that the meatpacker has taken advantage of a failed federal Immigration system.
"In doing so, this company has fallen far short of meeting the high business standards that Iowans expect," Culver said.
Note that the powerful Jewish owners are NOT being arrested. Being connected helps. This mirrors the US punishing the lowest level guards in Iraq in the torture cases there. Punishing the guys following orders is typical. And corrupt. The failure of immigration right in the wake of 9/11 is treason. The borders are closed to people like myself. If I try to cross, I will lose my computer. And since I write about stuff like when I was a hippie and took LSD, why, this is also grounds for grounding me. But illegal aliens flowed back and forth with total impunity. Back in earlier times, the US government said they would prosecute owners of factories who fire Americans and rehire illegal aliens. So what happened?
Lobbyists. This is not being fixed. Our legislators want to get rich, not serve the nation.