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A prudent person foresees danger and takes precautions. The simpleton goes blindly on and suffers the consequences.

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there is a decay of conscience, the pulpit is responsible for it))) --


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X22 Report is a daily show that will cover issues surrounding the economic collapse

Tuesday, May 5, 2015

The Rant - U.S. Prints Economic Slavery

U.S. Prints Economic Slavery
Did you hear the one about the two stock traders who met for lunch? The first one asks, "What do you think." The second replies, "I think the market will rise."
"So do I!" "Then we agree." They finish lunch and walk out in accord. It is only when they get back to work do they realize there is nobody to trade with because you have to have someone who is willing to sell in order to buy. They realize this when they have the pink slips waiting on their desks.

That in essence, sums up the American market today. Less than one in seven traders or investors can even conceive of the market going down anymore. There's no balance left. All as a result of the Federal Reserve's thinking it is above politics or even normal people.

The extreme printing press run is akin to one stockbroker slapping the other across the back while ignoring the fact the continual, contrived bull run is against every economic law ever devised. Bubbles abound but until they pop, none in the government seem to see them.

Stephen Roach, former chair of Morgan Stanley Asia and currently a Yale economics professor, said about the printing press run last week, "Not only have wealth and currency effects failed to spur meaningful recovery in post-crisis economies, they have also spawned new destabilizing influences that threaten to keep the global economy trapped in a continuous series of crises as the wealth effects of monetary easing worked largely for the wealthy, among whom the bulk of equity holdings are concentrated. For everyone else the benefits were negligible."

David Stockman, former White House budget chief added to the problem outlined by Roach. "The greater the size of the Fed balance sheet, the greater the amount of fraud released into the financial system." To Stockman's point, the Fed balance sheet of printed money went from $800 billion at the close of 2008 to more than $4.5 trillion today.

The first direct crisis of the central bankers' currency war is coming Wednesday in Greece. Greece has an installment on its debt due the IMF on Wednesday for 200 million euros (about $220 million). On May 12 it has another 770 million euro payment due. Euro-area officials involved in the talks for emergency funding for Greek banks expressed skepticism that a technical agreement will be reached by Wednesday's due date.

The problem the Europeans are having is that, under the existing agreement, restrictions on Greek banks can only be eased once it is 'absolutely clear' that additional bailout funding will resume. Without this assurance, Greece is left to its own ability to repay its debt and Prime Minister Alexis Tsipras has made it perfectly clear without some concessions by its creditors, Greece cannot keep that provision.

America, while it doesn't have this problem yet, is in even worse shape. The dollar's position as the world's reserve currency is being openly challenged. Without this prestige to back the outstanding U.S. debt, interest rates will have to climb on that debt. In its current financial situation, the government simply cannot continue to cover its promised expenditures because the added interest has to come from some already promised budgets.

Cutting any budget area in the public sector when the consumer has already demonstrated a reluctance to spend dwindling currency in the first quarter would merely expose the weakness of the American economic recovery for the sham it has been for the past six years.

In this regard one has to look no further than the impending Commerce Department report due tomorrow that is expected to show the U.S. trade deficit rose nearly 13% in March from February. The main culprits in the trade deficit are Japan, Germany, China and South Korea. However, instead of addressing the problem directly, U.S. governmental analysts will put the blame on those countries' monetary and exchange rates policies which, they feel, pose a 'significant barrier' to U.S. growth.

That is not the case.

It is a factor but the U.S. policy of trimming positive traction by implementing "eco friendly" burdens that has resulted in millions of dependable jobs lost is much more of a deterrent for economic recovery than the exchange rates.

We have placed ourselves in the mouth of the predator by allowing our ability to economically stand alone--without the predatory countries' assistance--to disappear.

No amount of printed fiat, no amount of gain in the stock market can mask that grim reality. That is why all the contrived government programming for social justice are doomed to fail. We arrogantly sold ourselves into slavery thinking we could always bounce back to where we had been in the 1940s and 50s when we alone had the industrial strength to support our political machinations.

It is a funny thing the way the burden of slavery slips in. Once you have donned the yoke of slavery, even economic slavery, it is still a yoke and you no longer call the shots. Those operating the Fed and doing the policy decisions in Washington have to correct that problem before America can make lasting progress on the economic front.

 "I have sworn on the altar of God eternal hostility to every form of tyranny over the mind of man."--Thomas Jefferson

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