This article was written by Brandon Smith and originally published at Alt-Market.com
I began writing analysis on the macro-economic situation of the American financial structure back in 2006, and in the eight years since, I have seen an undeniably steady trend of fiscal decline.
I have never had any doubt that the U.S. economy as we know it was headed for total and catastrophic collapse, the only question was when, exactly, the final trigger event would occur. As I have pointed out in the past, economic implosion is a process. It grows over time, like the ice shelf on a mountain developing into a potential avalanche. It is easy to shrug off the danger because the visible destruction is not immediate, it is latent; but when the avalanche finally begins, it is far too late for most people to escape…
If you view the progressive financial breakdown in America as some kind of “comedy of errors” or a trial of unlucky coincidences, then there is not much I can do to educate you on the reasons behind the carnage. If, however, you understand that there is a deliberate motivation behind American collapse, then what I have to say here will not fall on biased ears.
The financial crash of 2008, the same crash which has been ongoing for years, is NOT an accident. It is a concerted and engineered crisis meant to position the U.S. for currency disintegration and the institution of a global basket currency controlled by an unaccountable supranational governing body like the International Monetary Fund (IMF). The American populace is being conditioned through economic fear to accept the institutionalization of global financial control and the loss of sovereignty.
Anyone skeptical of this conclusion is welcome to study my numerous past examinations on the issue of globalization; I don’t have the time within this article to re-explain, and frankly, with so much information on deliberate dollar destruction available to the public today I’ve grown tired of anyone with a lack of awareness.
If you continue to believe that the Fed actually exists to “help” stabilize our economy or our currency, then you will never find the logic behind what they do. If you understand that the goal of the Fed and the globalists is to dismantle the dollar and the U.S. economic system to make way for something “new”, then certain recent events and policy initiatives do start to make sense.
The year of 2014 has been looming as a serious concern for me since the final quarter of 2013, and you can read about those concerns and the evidence that supports them in my article Expect Devastating Global Economic Changes In 2014.
At the end of 2013 we saw at least three major events that could have sent America spiraling into total collapse. The first was the announcement of possible taper measures by the Fed, which have now begun. The second was the possible invasion of Syria which the Obama Administration is still desperate for despite successful efforts by the liberty movement to deny him public support for war. And, the third event was the last debt ceiling debate (or debt ceiling theater depending on how you look at it), which placed the U.S. squarely on the edge of fiscal default.
As we begin 2014, these same threatening issues remain (along with many others), only at greater levels and with more prominence. New developments reinforce my original position that this year will be remembered by historians as the year in which the final breakdown of the U.S. monetary dynamic was set in motion. Here are some of those developments explained…
Taper Of QE3
When I first suggested that a Fed taper was not only possible but probable months ago, I was met with a bit (a lot) of criticism from some in the alternative economic world. You can read my taper articles here and here.
This was understandable. The Fed uses multiple stimulus outlets besides QE in order to manipulate U.S. markets. Artificially lowering interest rates is very much a form of stimulus in itself, for instance.
However, I think a dangerous blindness to threats beyond money printing has developed within our community of analysts and this must be remedied. People need to realize first that the Fed does NOT care about the continued health of our economy, and they may not care about presenting a facade of health for much longer either. Alternative analysts also need to come to grips with the reality that overt money printing is not the only method at the disposal of globalists when destroying the greenback. A debt default is just as likely to cause loss of world reserve status and devaluation – no printing press required. Blame goes to government and political gridlock while the banks slither away in the midst of the chaos.
The taper of QE3 is not a “head fake”, it is very real, but there are many hidden motivations behind such cuts.
Currently, $20 billion has been trimmed from the $85 billion per month program, and we are already beginning to see what APPEAR to be market effects, including a flight from emerging market currencies from Argentina to Turkey. A couple of years ago investors viewed these markets as among the few places they could exploit to make a positive return, or in other words, one of the few places they could successfully gamble. The Fed taper, though, seems to be shifting the flow of capital away from emerging markets.
The mainstream argument is that stimulus was flowing into such markets, giving them liquidity support, and the taper is drying up that liquidity. Whether this is actually true is hard to say, given that without a full audit we have no idea how much fiat the Federal Reserve has actually created and how much of it they send out into foreign markets.
I stand more on the position that the Fed taper was actually begun in preparation for a slowdown in global markets that was already in progress. In fact, I believe central bankers have been well aware that a decline in every sector was coming, and are moving to insulate themselves.
Is it just a “coincidence” that the central bankers have initiated their taper of QE right when global manufacturing numbers begin to plummet?
Is it just “coincidence” the taper was started right when the Baltic Dry Index, a global indicator of shipping demand, has lost over 50% of its value in the past few weeks?
Is it just “coincidence” that the taper is running tandem with dismal retail sales growth reports from across the globe coming in from the final quarter of 2013?
And, is it just a “coincidence” that the Fed taper is a accelerating right as the next debt ceiling debate begins in March, and when reports are being released by the Congressional Budget Office that over 2 million jobs may be lost due to Obamacare?
No, I do not think any of this is coincidence. Most if not all of these negative indicators needed months to generate, so they could not have been caused by the taper itself. The only explanation beyond “coincidence” is that the Federal Reserve WANTED to launch the taper program and protect itself before these signals began to reach the public.
Look at it this way – The taper program distances the bankers from responsibility for crisis in our financial framework, at least in the eyes of the general public. If a market calamity takes place WHILE stimulus measures are still at full speed, this makes the banks look rather guilty, or at least incompetent. People would begin to question the validity of central bank methods, and they might even question the validity of the central bank’s existence. The Fed is creating space between itself and the economy because they know that a trigger event is coming. They want to ensure that they are not blamed and that stimulus itself is not seen as ineffective, or seen as the cause.
We all know that the claims of recovery are utter nonsense. Beyond the numerous warning signs listed above, one need only look at true unemployment numbers, household wage decline, and record low personal savings of the average American. The taper is not in response to an improving economic environment. Rather, the taper is a signal for the next stage of collapse.
Stocks are beginning to plummet around the world and all mainstream pundits are pointing fingers at a reduction in stimulus which has very little to do with anything. What is the message they want us to digest? That we “can’t live” without the aid and oversight of central banks.
The real reason stocks and other indicators are stumbling is because the effectiveness of stimulus manipulation has a shelf life, and that shelf life is over for the Federal Reserve. I suspect they will continue cutting QE every month for the next year as stocks decline. Will the Fed restart QE? If they do, it will probably not occur until after a substantial breakdown has ensued and the public is sufficiently shell-shocked. The possibility also exists that the Fed will never return to stimulus measures (if debt default is the plan), and QE stimulus will eventually be replaced by IMF “aid”.
Government Controlled Investment
Last month, just as taper measures were being implemented, the White House launched an investment program called MyRA; a retirement IRA program in which middle class and low wage Americans can invest part of their paycheck in government bonds.
That’s right, if you wanted to know where the money was going to come from to support U.S. debt if the Fed cuts QE, guess what, the money is going to come from YOU.
For a decade or so China was the primary buyer and crutch for U.S. debt spending. After the derivatives crash of 2008, the Federal Reserve became the largest purchaser of Treasury bonds. With the decline of foreign interest in long term U.S. debt, and the taper in full effect, it only makes sense that the government would seek out an alternative source of capital to continue the debt cycle. The MyRA program turns the general American public into a new cash stream, but there’s more going on here than meets the eye…
I find it rather suspicious that a government-controlled retirement program is suddenly introduced just as the Fed has begun to taper, as stocks are beginning to fall, and as questions arise over the U.S. debt ceiling. I have three major concerns:
First, is it possible that like the Fed, the government is also aware that a crash in stocks is coming? And, are they offering the MyRA program as an easy outlet (or trap) for people to pour in what little savings they have as panic over declining equities accelerates? Bonds do tend to look appetizing to uninformed investors during an equities rout.
Second, the program is currently voluntary, but what if the plan is to make it mandatory? Obama has already signed mandatory health insurance “taxation” into law, which is meant to steal a portion of every paycheck. Why not steal an even larger portion from every paycheck in order to support U.S. debt? It’s for the “greater good,” after all.
Third, is this a deliberate strategy to corral the last vestiges of private American wealth into the corner of U.S. bonds, so that this wealth can be confiscated or annihilated? What happens if there is indeed an eventual debt default, as I believe there will be? Will Americans be herded into bonds by a crisis in stocks only to have bonds implode as well? Will they be conned into bond investment out of a “patriotic duty” to save the nation from default? Or, will the government just take their money through legislative wrangling, as was done in Cyprus not long ago?
The Final Swindle
Again, the next debt ceiling debate is slated for the end of this month. If the government decides to kick the can down the road for another quarter, I believe this will be the last time. The most recent actions of the Fed and the government signal preparations for a stock implosion and ultimate debt calamity. Default would have immediate effects in foreign markets, but the appearance of U.S. stability could drag on for a time, giving the globalists ample opportunity to siphon every ounce of financial blood from the public.
It is difficult to say how the next year will play out, but one thing is certain; something very strange and ugly is afoot. The goal of the globalists is to engineer desperation. To create a catastrophe and then force the masses to beg for help. How many hands of “friendship” will be offered in the wake of a U.S. wealth and currency crisis? What offers for “aid” will come from the IMF? How much of our country and how many of our people will be collateralized to secure that aid? And, how many Americans will go along with the swindle because they were not prepared in advance?
[NOTE FROM STEWART RHODES:
The ticking time bomb of our economy is the greatest single threat, and most likely catalyst for serious civil disorder, that we face. Which is why Oath Keepers launched our CPT Program to get our members to focus on emergency preparedness and community mutual aid and defense.
It is critical that you focus the lion's share of your energy, money, and time on preparedness at the individual, family, neighborhood, town, and county level, getting ready from the bottom up. If you are not prepared to care for your family, neighborhood, and town through a catastrophic economic collapse, then you really have no business attending some protest or some convention that seeks political solutions. I am not saying to abandon politics or to not protest - but those are things you should do AFTER you get your AO squared away for mutual aid and mutual defense, and that includes training too, not just amassing stuff. Are you and your family trained? Is your neighborhood watch?
Do you even have a neighborhood watch? Bottom line is if you don't have a neighborhood watch established, stop whatever else you are doing and get that done, as priority number one. And if you don't have food storage to feed you and your family for at least six months, again, you need to stop whatever else you are spending discretionary money on and fix that critical hole in your preparedness. Doesn't matter how many guns you have - you can't fight very long while starving to death.
The Titanic is going down, and it is too late to fix the intentional sabotage. And arguing over who will be the next captain on the doomed ship is also pretty pointless (especially when they are more alike than different). What matters now is building life rafts. And that means food storage, emergency medical, communications, fuel, shelter, clean water, growing gardens and raising chickens, goats, rabbits, etc., and it means organized, trained security as a community. Get busy, and stay busy, focused on what will really matter most when the crap hits the fan.
As I urged in the CPT Program announcement, work in three or four month sprints, getting as squared away as possible in that period of time, acting as if that is all the time you have, so that if a collapse happens during that time, you will be as ready as possible as soon as possible. If it doesn't happen in that four months, then fine - do another sprint of preparation, organization, and training! Note that I am not making predictions on when it will happen. I am just urging you to presume the worst, and get ready as fast a possible.
Got a trained, equipped, supplied family? Your family is your most important team. Are they training?
Got emergency medical in your family? Is someone in your family trained in that skill or training in it? In my family, my 17 year old son and I are in EMT basic training right now, at our local community college, because we realized that we needed someone in our family with those skills, and a backup.
Got emergency communications in your family? My son and I, along with my eldest daughter, are also studying for our HAM licenses. We have our handheld HAM radios, and a more powerful radio we are mounting in our truck, and now we are learning to use them and integrate ourselves in a local HAM network. Are you establishing emergency comms in your family?
Got emergency engineering for power, water purification, shelter, and fuel?
Got security? And that is not just having guns and ammo. It also means training, including small unit tactics training such as provided by Max Velocity (I have attended two of his excellent classes and cannot recommend them enough. I will post a review shortly, but the short answer is that unless you were an Army Ranger, or otherwise extensively trained in light infantry small unit fire and movement and patrolling, then you absolutely need his class (and even if you were trained in light infantry skills, I still recommend it to make sure there are no gaps in your skills and because it will make you better at what you already know - there is no substitute for realistic training under the watchful eye of a top flight trainer like Max). You are better off with a rusty AK, six mags, and 500 rounds of ammo and Max's class under your belt than having a safe full of expensive guns and gear but no basic knowledge in light infantry fire and maneuver. Get to Max and get trained! And then train your family and friends.
Got neighborhood watch? Are they trained? Do they have emergency communications, medical, and engineering? If not, then get it done.
Got an awake veterans org in your town, that is forming itself into the local civil defense group? If not, then wake em up and get them off the bar stools and get them training, gearing up, and taking responsibility for their community security.
Got Sheriff Posse?
You get the idea. Get it going, starting with you and yours, and working outward from there, till your town, county, and state are ready to ride out the storm. That is what you can actually do. It is too late to keep the crash from happening. What matters is how we ride it out. - Stewart]
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