The Mother of All Depressions (MOAD)
Bob Moriarty
Mar 19, 2009
The US government lit the fuse to the $683 trillion dollar derivative's debt bomb on Wednesday March 18, 2009 with the announcement the Fed would purchase $300 billion dollars worth of US Treasury used toilet paper and an additional $750 billion dollars worth of mortgage backed used toilet paper. In total the commitment to counterfeit over a trillion dollars leaves only $682 trillion dollars worth of derivatives to sort out.
Economics is all about price discovery. No one knows what the real value is of the $683 trillion dollars in derivatives. No one knows who owns what. No one knows who owes what. If left to its own devices, the market would lower prices until all assets had a value to someone. The government in its infinite wisdom has just short-circuited this discovery mechanism.
This is the end of the dollar. Everyone with any sense on earth will be unloading both their treasuries and mortgage-backed crap on the Fed. The Fed has just pissed $1 trillion of counterfeit money into a $683 trillion dollar cesspit. It can't possibly fix the problem. When the world realizes the impact of the Fed monetizing all debt, there will be a total default. And then what happens?
The Mother of All Depressions.
The ability to publicly fund its debt has been what has kept the US government spending. Once that ability is dead, so is the government.
The meeting of the G20 in London on April 2, 2009 will be the most important financial meeting in history. If the delegates do not adopt a new gold standard of honest money, the dollar will totally default within a few months. The fuse has been lit. There is nothing the government can do beyond what they have already done. Nothing has worked. Nothing can work.
Bob Moriarty
President: 321gold
Link
China Inc. On Huge Foreign Buying Spree!
China’s companies are fast finding ways to spend, snapping up raw materials across the globe while those assets are cheap.
Chinese companies have been have been gulping down tens of billions of dollars worth of key assets in countries as varied as Iran, Brazil, Russia, Venezuela, Australia and France, the Washington Post reports.
link
AIG IS CHINESE!
The AIG companies were one of the very few U.S. companies to have their origins in China when their founder, C.V. Starr, formed American Asiatic Underwriters in Shanghai.
Actually this will only increase the deflationary spiral. Unemployment is rising, demand is falling, the FED just launched commodities into the stratosphere, driving the dollar lower increses the price of imports causing demand to fall more reducing the dollars that can be used to buy treasuries and support exploding goverment spending on a collapsing tax base.
ReplyDeleteCool.
Sorry but your wrong. The Chinese take over creating massive DEMAND! The more everything falls the better for the Chinese. Thats the problem you Americans think your the only people on the planet..DUH..HYPERINFLATION HERE WE COME.
ReplyDeleteI agree that hyperinflation is the major concern here. The deflationary spiral will only last as long as the liquidation sales suppress inflation. Once that ends, Chinese demand will surge and commodity and food prices in North America will soar. And 99.5% of people are not prepared for it.
ReplyDeleteI would have laughed at this a year ago. I would never have believed the prosperity would come to an end. Now I'm not laughing.
ReplyDeleteI was a corporate executive until six months ago. Now I have a part time job as a warehouse worker and I'm very lucky to have that. I am continuing a transformation from a pampered, affluent, well-dressed business executive into a blue-collar working man and by the time the changes are finished I will be a very different person.
My wife and I have been able to keep our home for now, but my Lexus was traded in for a pickup and my beard is growing in for the first time in my life.
It is a great education. I never thought this could happen to me, a man with an MBA and years of executive experience. I was very, very wrong and foolish in my arrogance.
I realize now how spoiled I have been - seeng life from inside a pinstriped suit and a silk tie, with polished Italian shoes on my feet and a briefcase in my hand.
Now I have been dragged out of my corporate world and stripped without warning of my prestigous job, my office, my fancy business suit, my expensive tie and my polished shoes, and my entire white collar identity -and I am waking up fast.
We are fortunate to have enough to eat and a place to sleep. We are saving what little we have left to buy canned goods and have sold many of our personal items.
I am finding a new identity in the midst of all of this. For a former clean-cut, straight arrow, impeccably dressed executive like me, it is a feeling of freedom and rebellion to let my bead and hair grow and put on work boots.
My wife and I have more time together and I am training as a mechanic to prepare for a job that might be available in the future.
There will be a need for good mechanics in the depression, but not for executives in pressed pinstriped suits with clean fingernails.
There are millions going through what I am experiencing and together we will be changed nation.
Few people from my former life recognize me now: a bearded, pony-tailed, uniform-wearing warehouse worker. No more polished Italian shoes for me or slick haircuts! I never for a moment thought I would become a mechanic. But I will be very, very lucky to have any work at all.
Corporate suit-You have a head start on most of us! Many will be left with a bewildered look, standing in a soup line.
ReplyDeleteThat's a refreshing and honest appraisal of yourself, ex-corporate exec. It's never too late to apologize and make changes. For a lot of people, karma is going to bite them in a big way. It's nice that you see the writing on the wall and are making some positive strides.
ReplyDeleteforgot who said it but:
ReplyDeletecharacter - the only thing left when you have nothing left to lose.
One day corporate suit we will read another comment from you and you will not mention articles of clothing one time and then, we will know that you have made the necessary adjustments.
ReplyDeleteSounds like corporate suit has found the way!
ReplyDeleteCHEERS and good luck!!!
Welcome aboard.
Refreshing to finally find a "good news" post in this time.
Thanks very much for the encouragement and all of the comments! One of the toughest things has been the lack of people to talk to about what has been happening. Your attitude is much appreciated.
ReplyDeleteMy wife has been great. I didn't know how she would take it but she has been working exta hours herself and she is very practical about everything.
I read this comment several times: "...you will not mention articles of clothing one time and then, we will know that you have made the necessary adjustments".
I was confused and didn't get it until I showed it to my wife. She laughed and said she understood: that I talk about who I USED to be who I ONCE was and my FORMER self - and about suits and shoes I no longer wear at all and won't wear again to work.
I didn't realize it. It's true that it's taking me some time to leave my old identity and my previous life behind and fully adapt to my new self. I sill have adjustments to make. It's still a surprise sometimes when I look in the mirror and see a bearded blue collar worker.
It takes time to remove a man's arrogance and a haughty attitude, and admit I could be haughty in the past. But as they say - what goes around, comes around!
But we are now in a world where the old rules don't apply and some jobs will be worth a lot moe than others: the old "low status" jobs will now be the ones needed. I am determined to find a way to adjust.
She suggested that I change my blog name to "I am a Blue Collar Warehouse Laborer"! You'll know when I make the necessary adjustments when that happens.
中国 is taking over. You better learn how to read and write Chinese:)
ReplyDelete