The Herd Follows so Far Behind The Lead Bull…They Fail To See Him Turn To Avert The Cliff

“Tolerance is the last virtue of a dying society.” (Aristotle) -- Today we have yet again tolerated another lie.  We were told, by the Fed, that Q-Infinity was necessary in order to save the economy when indeed their only intended use was to prop up the “too big to fail banks”.  This liquidity is simply sitting in their banks producing millions in interest for their benefit and at our expense while the common mans out stretched hands are thin and empty.

The “change” peddled to the masses has done “absolutely nothing” to fix the system.  We now have more people on the dole and pushed into the cart.  More small businesses have been pushed to the brink as the local, national and international crisis play out.  Another recession is just around the corner and is the direct result of this administration’s credit policies as more and more credit has been added.  The outcome will be far worse than we have experienced in the past 5 years.  More businesses will fail and more jobs will be lost. Our country will experience even higher unemployment, more families collecting food stamps, housing vouchers, medical care and climbing into the cart to be pulled by an even smaller group.  Atlas continues to stoop and bow under the weight of pulling 55% of the population that receives at least 1 of 80 entitlements.  Add in the number of those on Social Security and Medicare and you approach 75%.  The next crisis will invariably sink the remaining middle class that has been holding on by a thread these past years when the next round of job losses occur, housing values plummet and paper stocks drop.  The existing small businesses that have been treading water will finally be pushed over the edge by the elite bankster’s and corporate owners as they had planned all along.  The numbers of the unemployed will rise upwards to 25% and higher in the next year as the system crashes.  

Our government cannot spend its way out of the corner they have painted themselves into with no growth in the GDP.  Today the GDP even includes future promised entitlements such as Social Security, Medicare, Medicaid and government pensions.  Therefore the graph below displays a lower GDP than shown.  Any growth we have experienced has come from priming the pump which has increased the stock market and pushed up housing values.  The plan by the Fed, Bernanke and the boys going forward is to ease more and more money into circulation at a pace that allows for the continual expansion of government interaction in the economy. 

Our markets are addicted to credit like a heroin user.  They bottomed in 2000 and the Feds added junk credit, then again in 2008.  When that didn’t work the Feds got busy manipulating interest rates to zero to get everyone back into the markets to take even more risks.  Dollar signs appeared in the minds of professional traders when they saw cheap stocks and recognized that prices would rise with money printing.   They were all in!

The American public though had simply been burned twice and was twice shy.  They withdrew the billions they had left in 2012, but after seeing stocks up over the past five years mom and dad decided to jump back in with both feet in an attempt to recoup their losses with even more than they had invested in the markets during 2007.  An emotional bunch they are repeatedly too late for the dance, buying high and selling low.  It seems they are always too late for drinks and the banquet being served.  They chase the herd leaders and when corrections happen like we currently have experienced in precious metals the faint at heart feel destroyed and sell only to miss out on the market reversal. 

The populace believes the system cannot fail and are hanging their retirement plans on the wide 500 select stocks of the S&P500.  They will find that they too are too late for supper, in a game they should have started in October 2011.  Just last week George Soros placed a put to sell $1.25 Billion betting that the S & P will shortly crash! 

Why can’t Americans see the correlation and the fact that the divergence of these two statistics (GDP & S&P 500) confirms that the evisceration of our economy is at hand.  There is no recovery and the government can do nothing now to save our system.  Ben “Buzz Light Year” Bernanke is but printing as his thesis suggested “Q-Infinity and Beyond” while praying that the imminent collapse doesn’t happen on his watch.  Collapse is but a foregone conclusion!

The U.S. GDP is no longer a relevant indicator as it has been misused. Politicians and the media point to growth since 2009 only because government spending has skyrocketed and is included in a major component of that index. GDP is not wealth nor is it a reliable measure of our countries productivity.

Forty seven of the 50 top corporations are mega big banks, insurance companies and financial service companies who make and produce nothing.  These corporations make money off your sweat and labor.  The middle class is now employed in a mere 25% of jobs labeled as good jobs and therefore 75% of other available jobs are mediocre and low paying!  The middle class is struggling to keep a roof over their heads, food on the table, utilities paid and gas in their tanks to drive to work.   Remember that “Nero fiddled while Rome burned”, the parallel is clear today.

The sequestration was a charade and proved that it is impossible for our government to cut jobs.  They have no intention of pruning our bloated government from the inside out.  The government fails to understand that they produce or make anything and that only the public and private sectors provides services and goods.  

Our governance puppet’s vacation comes to an end to deal with the continuation of the crisis saga, “Debt Ceiling Infinity”.  We are now being warned that the end is unsustainable and must end in this report from the Congressional Research Service  released in May, “The Debt Limit: History and Recent Increases.” 

They conclude, “Debate during the 2011 debt limit episode reflected a growing concern with the fiscal sustainability. Over the next decade, without major changes in federal policies, persistent and possibly growing deficits, along with the ongoing growth in the debt holdings of government accounts, would increase substantially the amount of federal debt. CBO warns that the current trajectory of federal borrowing is unsustainable and could lead to slower economic growth in the long run as debt rises as a percentage of GDP. Unless federal policies change, Congress would repeatedly face demands to raise the debt limit to accommodate the growing federal debt in order to provide the government with the means to meet its financial obligations.”                                                

http://www.fas.org/sgp/crs/misc/RL31967.pdf 

The manipulation in Gold and Silver over the last 8 months was to recapitalize the banks by manipulating the weak masses to sell their physical metals in preparation for their finale.  If you have held firm gold will perform its job of insurance and protect your wealth. We will soon see a war over the next several weeks as gold breaks free of the manipulation and gets busy discounting the impending currency crisis.

The intervention is going to try hard to keep gold prices down, but ultimately gold will win and break free of the artificially low prices. Ultimately gold is going to protect wealth during an inflationary period of time, just as it always does. Ultimately the manipulation will only succeed in causing gold and silver prices to rise farther and faster than they would have if had been allowed to trade freely.  Brace for impact; the next Fed’s created catastrophe has already begun.  Protect your life’s savings by getting out of all paper and into tangible assets like gold and silver.  It is the insurance you need to protect your family from the corruption around you!  They have already told us they will nationalize retirement plans and pensions into government bonds and they will bail in the banks with shareholder funds.  If you wait for this “their finale” you will ultimately be too late!