The USA Refuses To Understand Bankruptcy

Elaine Meinel Supkis

My astronomer grandfather used to tell me, 'We are always living in the past because it takes time for light to travel so we see only things that already happened. And the further away something is, the further back in time it is and the stars are far back in time, to Creation.' The news stream we get is always the past, the most difficult thing to do is projecting forwards into the future. The more accurate the predictions, the more one can make money anticipating future events. But one can't see into the future unless one is an astronomer and can see into the past. The further one sees into the past, the more one can predict the future. And this is how I try to set up my articles here: watching the trajectory of events. And America is in grave danger. It is obvious.

From Reuters:

The Bush administration may increase the amount of money it is seeking for the Iraq war for the 2008 fiscal year that begins October 1, the White House said on Friday.

The White House outlined a request for around $147 billion for fiscal 2008 for the wars in Iraq and Afghanistan. But the administration is reviewing those figures and is considering giving Congress an updated request.
*snip*
The Washington Post has reported the administration may increase its request by up to $50 billion, which would bring the total request to nearly $200 billion.

$200 billion a year, all of which must be raised from other governments, all of whom are ultimately our rivals. I marvel how our media and our political classes refuse to talk about rivalries yet they love to boast about how we are at the top of the world and can do as we please. Going to one's trade partners for money to fund wars is stupid and dangerous. For anyone buying our debts can then set terms. The terms are quite obvious: we must allow them to have very unbalanced trade with us and they are allowed to penetrate our domestic markets and destroy our industrial base and buy up all our facilities, banks and systems.

The subjegation of America is growing now at a much higher rate than even 10 years ago when at least our government pretended to be interested in stopping foreign domination! With all systems running in the red, the demise of the American empire is certain. $200 billion isn't spare change. It isn't a small amount. But we should understand, this is 4X the size of our FOREX reserves. This is a significant percentage of our Federal Budget. What is worse is, it is buying us nothing, not even time. Each day, things grind down more and more in Iraq and Afghanistan. Each day, US soldiers die, many Iraqis and Afghanis die and the war grinds onwards and expands.

The delusion that we are gaining control of this vital region won't die. Our corrupt Congress and President, both of which are thoroughly entangled with foreign powers and aliens who use us for their own ends, continue this war in the teeth of strong condemnation by the American people. This is part of our continuing Constitutional crisis that began in 1913. The need to feed an empire meant rigging politics so that the Constitution could be circumvented. As our empire grew, our ability to control things has collapsed and the power that runs America has ceased to come out of a consensus of the people and increasingly, became a matter of money and bribes running everything.

From the NYT:

By the end of June, the candidates had raised a combined total of $551,000 abroad, compared with $31,525 at the same point in 2003 and nearly $1 million for the entire election cycle.

The increase appears driven by factors like the ease of donating on the Internet, a diaspora among financial workers in an increasingly global economy and the unending needs of campaigns to cast as wide a net as possible.

“Given the expense of American presidential elections, every fund-raising opportunity is important, and you’ve got to take advantage of it,” Mr. Giuliani said after joining his donors for wine and salmon at the Mandarin Oriental in London.

The people interested in keeping our wars going have such control of Congress, US citizens trying to attend hearings about all this are burtalized in the halls of Congress just like the young man in Florida was brutalized while Kerry said, 'Interesting question...' before not answering. The ruling class still pretends we have politics and they get the voters all worked up about elections only to totally ignore them in between elections. For example, the push to legalize illegal aliens was not popular with many Americans yet Congress and the President pushed this until the uproar became dangerously intolerable and the government backed down.

But all the systems are set to be run via fiat: the government via the President signs statements and then these become law and this is by definition, a dictatorship already. We still have tiny say in who gets to be dictator, thus the need for them to give us goodies still, but this will pass, too, eventually. The plan is, if someone like Ron Paul, for example, gets near the White House, they get killed. Ask any nation on earth that voted for someone our government didn't like. Coups and assassinations are key tools for controlling events.

The US cannot afford these wars nor can we afford to patrol the planet. We must return to our home base and make it stronger. England made this mistake twice. Before WWI, Enlgand was overextended. Germany lunged at France and England directly instead of doing it via proxy wars in Africa or Asia. Then England's empire grew even bigger after WWI.

Germany lunged a second time at England and nearly took England down! The only thing that saved Enlgand was the US empire. And we joined very, very reluctantly because many Americans were disgusted with the British Empire. Since WWII, we took over this empire with the Brits riding piggy-back. Just like the British empire, we are overextended and in increasing debt.

It is imperative we stop this. We can't afford a $500+ billion military commitment every year! This is $5 trillion in 10 years. Our federal debt grew by $5 trillion in the last 10 years. It is at nearly $9 trillion today and the government just raised the ceiling by nearly another trillion dollars. Our trade rivals including a very significant empire, China, fund all this for us. But this is for purely hostile reasons. Ignoring this fact is pure stupidity. Our Presidential candidates go to several sources for funding and two of them are very dangerous: China and Israel. The supporters of both entities gladly pour massive amounts of money into our elections in order to keep control and this is destroying both our economy and our national security.

From CNN:

Aid agencies were appealing for millions of dollars Friday to help more than 1 million Africans affected by deadly floods that have swept across the continent.

The United States planned to send $100,000 for Uganda -- one of the hardest hit countries -- and Europe announced more than $15 million in aid for flood victims across 17 countries. The floods have killed at least 200 people and displaced hundreds of thousands since the summer in central and eastern Africa.

The US just gave Israel over $20 billion so they can steal olive groves and bomb their neighbors with impunity. Nearly everything Israel does at this point, costs us dearly. And we pay for every bit of this garbage with hard cash, too. The loss of power due to our debts is obvious. When nature strikes, we strike out. We can't even help ourselves as the continuing disgrace of New Orleans shows the whole world. To put the $100,000 into perspective, this is the cost of guarding our embassy officials who go about Baghdad, butchering everyone at traffic intersections....FOR ONE DAY! One day's costs! Astonishing. And for only ONE trip by a small group of ambassadors!

This costly mess is hitting us in so many ways, the collapse of our diplomacy, the collapse of our economic power, the collapse of our morals as we ignore the lessons of our own Founding Fathers.

I got this AARP email today and thought it was interesting due to the fact that our own government isn't even bothering with the fiction of caring for the American people even slightly:

Congress Calls for Help Toward Energy Costs

With the help of AARP, Congress is urging President Bush to release $151 million in emergency funds for the Low Income Energy Assistance Program (LIHEAP). LIHEAP helps millions of low-income Americans—many of them seniors—pay for high energy bills. The fight for next year’s LIHEAP funding is just about to start. If you’re concerned about rising energy costs and want to join AARP’s advocacy efforts this fall to help older Americans pay for their utility bills, go to www.aarp.org/getinvolved to become an e-advocate.

$151 million is the cost of just 12 hours of war in Iraq and Afghanistan. The numbers are breath taking, aren't they? Bush is demanding Congress control spending! So these simple things for people here are being eliminated so we can go to war there! And the people bankrolling the politicians want wars and want us in debt to foreign powers for many of them ARE foriegn powers! This is why we are always negotiating from a position of weakness. It is our financial weakness. Instead of being happy we can sell our US bonds to China, Saudi Arabia or Japan, this should be the topic of an emergency hearing in Congress! But then, anyone talking about this is ignored such as, typically, Ron Paul.

From Silver Bear, via a reader here (thanks for the links!)

The central bank in our nation, an independent agent that can do as it pleases, has no morals at all. Nor does it support our nation as we saw from its inception right on the eve of WWI. Nearly instantly, the Federal Reserve was set up to arrange deals with the banks in London and to thus, fund the British Empire and the Crown. With the bankruptcy of England, the empire became ours yet the curious banking relationship continued. When Congress refused to fund the wars Britain was embroiled in after WWI, Presidents worked with the Federal Reserve to circumvent Congress by loaning money through exo-Congressional systems set up to evade the Constitution which was written by revolutionaries who feared despotic rulers and thus, wanted Congress to be in control of the purse, not someone in the White House.

Ron Paul is a very old-style conservative. He increasingly irritates his own party by talking about things like money. This irresponsible immorality of our central bank is bankrupting our nation. Everyone is being encouraged to follow policies that weaken our nation. We are told, we should invest overseas, we should sell dollars and buy euros, we should make deals with Saudi Arabia and we are allowed, very astonishingly, to be dual citizens. So many people come here and then instantly refuse to support this nation, they vote in another nation, they hold jobs in other nations and in general, treat this nation as a tool rather than as a home. The rulers who have zero patriotism love to talk about patriotism because they are worried the masses here will figure them out. This is why Congress, that is selling us down the river to foriegn powers, will spend precious time attacking an anti-war ad paid for by enraged Americans sick and tired of wasting our precious resources and money on a failed war!

Every Senator who voted to condemn MoveOn should be examined and removed from office. For more Americans support ending the war than support continuing this war. But of course, the desire to wave flags while ignoring the essence of patriotism is overwhelming. Erzatz patriots who won't end the dual citizen programs shouldn't throw rocks at real patriots, worried about these imperialist adventures.

From the Daily Pfenning:

One ex-Central Banker spoke and the markets paid attention to him... Yes, you guessed it, good old Big Al Greenspan... The former Fed Chairman speaking in Vienna to promote his new book, said in an interview that "low interest rates in the past 15 years were to blame for the house price bubble, but that central banks were powerless when they tried to bring it under control"... He went on to add... "It's a difficult situation, there is an enormous overhang on the real estate market. Many buildings which just have been finished can't be sold. So far, prices have dropped only slightly. But it was enough to cause alarm around the world. Prices are going to fall much lower yet."

The Daily Pfenning is like so many financial advisory services: it is all about how Americans can protect themselves while this ship is sinking only the very things worried Americans are advised to do are the same things that make this ship sink faster! So as everyone rushes for the exits hoping to save themselves, the rot at the core, the rot in DC, continues and worsens as it becomes each man for himself. The anti-tax mania is the same: damn the disabled, the children, the strong will push forwards and abandon them as everyone goes Darwin. There is no patriotsim in Darwin 'red in tooth and claw' capitalism. Indeed, our problems are due to everyone at the top selling us out to foreign powers just so they can make more profits. Our trade deficit is purely profit-driven. The more people rush overseas to make more money, the worse our situation is, here at home.

From the BBC:

More cuts may have to be made at Airbus if the euro continues to remain strong against the dollar, an executive at the European planemaker has warned.

The main bulk of US manufactured trade benefits are with Boeing. I have written about this for a long time. Much of the energetic actions of our trade representatives and our rulers is to extend contracts for Boeing. This makes our lousy trade stats look good since these contracts are for huge sums. The rise in the value of the euro is killing our European competitors who need their Airbus jobs in order to keep labor peace. Americans don't worry about Europe blowing up with labor unrest but I see this in Europe's near future. Governments will suddenly fall there if the euro's relentless rise kills jobs.

From Gold Seek.com:

The USFed requires foreign central banks to halt their rate hikes, a process evidently begun, but not without risk. If the USFed cuts rates while Europe continues to hike rates, the USDollar will enter a profound decline. The Euro Central Bank is embroiled in a battle with French President Sarkozy. The ECB wants more rate hikes to deal with price inflation. Sarkozy wants politicians to have a role in such decisions, to halt them. The European Union Monetary Affairs Commissioner Joaquin Almunia on Sept 3rd made an important public statement. “The current cycle of Eurozone interest rate tightening is nearing its end. The main part of the interest rate rise is already done. I do not think its is going to rise much more. In the very short term, rate cuts will not be announced, but for sure, in the medium term, interest rates are going to fall because the Spanish, European, and world economies are fundamentally solid.” The consensus is that the ECB will hike once more to 4.25% in the autumn. Pressure is felt by ECB officials to continue hikes, since their euro money supply is growing at a 11.7% rate, year over year in July.

I warned Europe that their banking policies would kill their industries. The US has been passive about the rise of the euro because our own industrialists hope to gain advantage from this. Europe is rapidly replacing the US as the destination of world trade. But this is a negative for Europe since it will wipe out their industry and reduce them to second world status just as it is doing here. The entire world trade system is warped badly and this is due to 'free trade' which refuses to understand how FOREX reserves, relative value of currencies and worker compensations versus profits works.

Or rather, they know but the people running Europe and America make fabulous money exploiting this system because they don't care if their host nations die! This is what I think. They really imagine they can sail away from all this. History is stern: if they try this, they will lose their fortunes in violent spasms we call World Wars. Every 150 years or so, there is a convulsion as the world girdling empires collapse and are replaced. The dual world wars when England was faltering were unusual but this was due to the US supporting England instead of replacing England after WWI.

France went for the English scheme: piggyback on the US empire. But it is too late. The Empire is going bankrupt so the benefits from this will be slender indeed and the government of France will fall before 2 more years. If not sooner.

From the NYT:

HSBC Holdings Plc, Europe's biggest bank, said on Friday that it would close its U.S. subprime mortgage unit, cutting 750 jobs and taking $945 million in charges and write-downs, because the business is no longer sustainable.

For London-based HSBC, which is under pressure from activist investors to shake up its corporate governance, it was the latest blow from the meltdown in the U.S. market for loans to home buyers with poor credit histories.

When investors make such demands, this usually signals a severe bear market. For they are naturally allergic to losing principal as well as potential profits. When these convulsions travel through an economic system, it always goes downhill rapidly since protection tactics are deflationary which is why all the central banks work so hard to inflate their currencies so often. This inflation forces investors to be risky. There is a balance here and we are at the autumn Equinox today: day and night are in balance. Our ancient Ice Age fears begin to surface.

From Bloomberg:

Mitsubishi UFJ Financial Group Inc., Japan's largest bank, may have to revalue its securities holdings at a ``significantly lower price'' because of credit-market turmoil triggered by subprime-mortgage defaults in the U.S.

Prices for some securities have declined, while others may not have been ``properly quoted,'' the Tokyo-based bank said in a regulatory filing today. Mitsubishi UFJ's American depositary receipts fell 60 cents, or 6.7 percent, to $8.32 at 4 p.m. in New York Stock Exchange trading.

Mitsubishi UFJ faces some of the same pressures that forced Wall Street's biggest firms to record a combined $3.8 billion of third-quarter losses after marking down the value of their holdings and financing commitments. Surging defaults on subprime mortgages have eroded demand for securities linked to home loans.

Goldman Sachs Group Inc., the world's biggest securities firm, said yesterday it had $1.48 billion of losses for marking to market the value of non-investment grade credits. Lehman Brothers Holdings Inc. and Bear Stearns Cos. each recorded $700 million of losses on markdowns of mortgage securities and leveraged loans, and Morgan Stanley's totaled $877 million. All of the firms are based in New York.

All these loses: we are talking over $10 billion in paper losses in this week's tally of just the top dogs in Hell's Hound House. This is the tip of the iceberg. Vanishing money can't make money. And since money must cycle in order to be money, this collapse of the cycle means recession or depression. Japan has used the depressionary tool rather than the inflationary and to good effect, their economy is doing great compared to the in-the-red US. But this means selling overseas heavily while NOT importing stuff at the same time to the same degree. Namely, a depression works only if the weak currency leads to a collapse in buying imports.

From Bloomberg:

The yen fell against 15 of the 16 most-active currencies on signs investors have resumed purchases of higher-yielding assets funded by loans in Japan.

The yen has dropped 4.6 percent against the New Zealand dollar and 3.6 percent versus the Australian dollar this week as the Federal Reserve's Sept. 18 interest-rate cut bolstered confidence in so-called carry trades. Lower U.S. borrowing costs may help sustain global economic growth, supporting prices of property, stocks and commodities.

It is official: China and Japan have a banking accord now and it is secret and it involves helping the US go off the economic cliff even faster. The US should be furious about his secret meeting and should be hammering Japan to spit out what happened but we won't, we can't, our rulers are making magic money again and so they are quite content. They fear a backlash but this election cycle shows how our media can still pull rabbits out of the corrupt DC hat and the potentially dangerous candidates are totally sidelined. Which Yale candidate, which think tank supported tool will rule us? That is the question.

I predict, whoever it is, they will betray us. Like Reagan, the Bushes and the Clintons. Namely, every leader since 1980.

From Bloomberg:

Mitsui Fudosan Co., Japan's biggest real estate company, may buy a stake in Imperial Hotel Ltd., owner of the 117-year-old hotel, expanding in central Tokyo as commercial land prices advance for the first time since 1991.

As I said last year, Japan's depression is totally fake and long over. I hope the news media mentions this some day. The passage of time between events and us seeing them increases thanks to the myoptic analysis of the herd of creeps yapping in the media.

Prepared by Alex Carrick, Chief Economist, CanaData

The U.S. trade deficit in goods and services dropped from about $800 billion (annualized) in September of last year to a little over $700 billion in October. It has been stuck there ever since, a period of eight months. This is an ongoing monthly deficit of about $60 billion in both goods and services.
*snip*
The goods trade deficit with China in May 2007 was $20.0 billion, which translates to $240 billion on an annualized basis, or 33% of the total deficit. The Chinese yuan has risen about 9% in value versus the U.S. dollar since it was allowed to partially float in July, 2005.
*snip*
Finally, Japan, Mexico and Canada combined to account for nearly 30% of the total U.S. deficit in the latest month. Japan was out front at $5.93 billion (9.9%), followed by Mexico at $5.87 billion (9.8%) and Canada at $5.17 billion (8.6%).

Congress, the President and the central bankers are all responsible for this. It is not by accident that Japan has negative inflation as its industrial base...in other countries!....grows ever bigger. The coordinated activities of the people running the nation, namely, the Liberal Democratic Party, goes to great lengths to create these conditions which benefits nearly only the major industrialists. Active participation in politics is suppressed by right wing goon squads who terrorize anyone who tries to make changes. Even so, discontent rises. The US government is so out of touch with the citizens here, all of them are rated very low yet the only 'popular' candidates are these same people.

The current system is still producing the illusion of prosperity. But again, we can only look back to the past to see the future. I notice that many people like to look back only six months or six years, some will dare to think about sixty years. But if you look back thousands of years, it becomes very clear, what will happen next.

Unlike the gold buying sites or the pro-Democratic sites or the mainstream media, I can't give much helpful advice as to how to protect oneself from what looms on the horizon. This is because I can't lie. There is no magic or physical way we should avoid this, we must face it, head on. The tactics for avoidance will hasten the day of doom, not put it off. Avoiding debt is the only good way to deal with this mess that is 'moral' as Dr. Ron Paul pointed out in his questions to Bernanke. And since savings will cut commerce, the State must take social actions to prevent dislocations and suffering in the working class who are very vulnerable to any economic stresses. This is why organizing political actions are 'moral'. So long as they don't follow in the path of Nazis who joined the needs for socialist state actions with paying for these actions by looting first, the Jews of Germany and then all of Europe!

Moral choices must be made and to see the consequences of these choices, we look to the lessons of history. And alas, the US, in pushing for more wars while spending too much on wars already, we are on the wrong road. The internet is quite admirable when it spreads messages like Ron Paul's calls for a more 'moral' economy. If he could only really endorse real freedom such as the freedom for me to choose whether or not I should bear children or an equal chance for promotion and economic opportunities for minorities, then he would be a great leader.

Alas, he is too Victorian and I remember how racist and anti-feminist those men from that time were! Economic power based on social discrimination and the enslavement of half of the population is not real populism, it is fascism.

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Comments

[Hamburger]

Great post - keep driving it home, Elaine.

[Neuro Artist]

Your grandfather seemed like a wise man Elaine.

"If he could only really endorse real freedom such as the freedom for me to choose whether or not I should bear children or an equal chance for promotion and economic opportunities for minorities, then he would be a great leader."

I partly agree. But I do think the issue of abortion is a complex one. If one puts the arguments on the edge it would be something like the right of the woman to have irresponsible sex vs the right of life of the unborn child. It is not that simple though, for many practical reasons, abortions will happen anyway (and later in the pregnancy), and unwanted children will always be at a severe disadvantage in life. I think allowing first tri-mester abortion is a reasonable compromise. I don't think the foetus has a human soul at that point (but who am I to suggest such a thing).

For the minority issue I think Ron Paul is attempting to end the rule of one small minority of elitists stealing the rights and enslaving the masses. But I must ask is he against equal rights of promotion and economic opportunities for minorities? Personally I don't think anyone will ever have equal opportunities. But I do think that it is possible to have systems restricting the opportunities of a select few oppressing and using the many for their benefits. But that necesitates a small government a monetary supply that cannot be manipulated, and a recognition of basic rights and obligations under the rule of law. Basically if you or your activity injures someone else you should be required to compensate that others loss, and if you do it willfully you should be punished for it.

I do believe as you do that if Ron Paul is getting close to the White house he will be murdered. But I wouldn't be surprised if George W is the last "elected" president of USA. Wouldn't that be a strange coincidence the first and the last are George W.?

[Elaine Meinel Supkis]

I nearly died twice having my second child. Due to all the damage from that, I was not supposed to have more children. Then I got pregnant (all this, within marriage) again and had to have an abortion to save my life.

And this was a pregnancy I wanted!

No one but the woman risking her life, can decide if she should bear life. It is literally a life and death issue with the mother. The freedom of choice is important here. I can assure everyone of this. My burdens are my own and this includes losses.

[GollyGee]

"Then England's empire grew even bigger after WWI..."

I assume you've read "A Peace to End All Peace" by David Fromkin, because I doubt anyone who hasn't can hope to understand how we got in this mess.

Yes,as Fromkin shows, during WWI Britain double-crossed everyone (Everyone!) to gain more territory, and immediately at the close of the war realized it couldn't afford the ill-gotten real estate or control it, and had to beg double-crossed France and then the U.S. for help.

We now have 800 military bases around the world, and like England we can neither afford them nor hold them -- and we won't be able to give the worst ones away to the U.N.

(And nobody, but nobody is going to want to adopt or financially support that orphan Israel that Britain gave us.)

Very soon we're going to be begging double-crossed Russia for help. (It won't be as forgiving as France.) China is already our banker, but it's going to be even more ruthless than we were with England.

England had us, Yankee traders that we were, to fall back on. We have no one. So yes, you're right, I'd say we're in grave danger. Not doomed yet, but in grave danger.

[Elaine Meinel Supkis]

Good synopsis, Golly Gee. :(

[jon]

More Profit and Less Nursing at Many Homes
http://www.nytimes.com/2007/09/23/business/23nursing.html?pagewanted=1&_r=1&hp&adxnnl=0&adxnnlx=1190556372-7H1iz6jgfSe7Pqsq4sh6Nw

[tutterfrut]

The poor little 'Sarkozy'. He wanted to install the Anglo-american debt economy in France, the miracle of more private debt to create more jobs and endless wealth. "Look at the employment figures in the US, Great-Brittain and Ireland", he said. His whole economic policy was built around this 'real estate' driven pyramid scheme and now its collapsing into his face. You're spot on that his government will not make it to the end. Let's just hope that there will be no french bank explosion à la Northern Rock, because the French aren't as disciplined in queuing as the Brits.
Two famous quotes of Sarkozy during his presidential election campaign:
"We have to reduce the nation's debt, because a nation in debt is not a free nation"

"People have to have all means to take on more debt, because it's a sign of faith in the future."

No wonder the country doesn't know which way to go...

[Neuro Artist]

Elaine you make a good case as to why the state, should have no right to interfere in the womans decision. I am sorry about your experience though. I realise that the burden of ending a pregnancy for whatever reason will be carried by the woman, and I don't think it is an easy choice. Thanks for making me think.

I think Sarkozy might be a plusgood future leader, he is obviously a master of doublethink!