The reality of impending economic collapse

[themadscientist]

Andrew Jackson gives a fist pump from the great beyond.

[Encryptshun]

The funny situation is that the majority mocks of Ron Paul like if he is crazy, but actually, by listening him with more attention, he is the only candidate that hits reality, while the rest only make promises on the air. Who, after Ron Paul, is asking to audit the FED?

I think Ron Paul is the only genuine presidential potential candidate America has had in decades. I agree with almost every idea he has.

[themadscientist]

http://www.msnbc.msn.com/id/44179875/ns ... umer_news/

As worldwide debt problems increase, the rush to buy and sell (gold) is only picking up steam

What is your wealth denominated in? Do you have tangible things of value or are you completely invested in paper and computer wealth? The cruise to crash continues unabated. Washington still doesn't get it. rather than take the S&P downgrade as what it is, tough love, the government lashes out with an SEC investigation. Sounds like textbook behavior for a addict cornered and forced to confront their addiction.

The U.S. government's and really most western nations' addiction is dubious currency and monumental debt that they don't want to talk about. Every bond issue is America telling the world they just need "one more fix" and then they will be ok and stop. The world is not going to support our self-destructive habit anymore and when the party comes to a stop coming down off the drug of easy money and guiltless spending beyond our means with no fear of consequence is going to be as rough as a heroin addict in the holding tank working that poison out of their system.

[Casey Kasem voice]And today's long distance dedication comes from halfway around the world from themadscientist, and he writes:

"Casey, I'm watching the destruction of my beloved country's future through the delusional irresponsibility of our government. In an effort to reach them through a new medium I'm sending out this dedication in hopes they might pull their god damned f*** ing heads out of their a** es and realize that you can't spend more than you take in. They need to shake their addiction to deficit spending and crushing debt and it's high time for an intervention"

Well TMS, I hear ya and I'm sending this auditory enema out to those Washington scumbags we hate so much. Here's Ministry with Just One Fix.[/Casey Kasem voice]

[youtube]http://www.youtube.com/watch?v=SeCjuLcZ2no[/youtube]

[themadscientist]

Well, Timmay goes to Germany and gets mushroom stamped by the Germans.

http://www.zerohedge.com/news/germany-r ... al-warning

European Central Bank Governing Council member Jens Weidmann told Germany's Spiegel magazine in an interview he considered it wrong to "throw out all established principles of monetary policy by citing a general emergency."

In a preview of an interview to be published in the new edition of Spiegel, Weidmann, head of the Bundesbank, said: "Once people start to use monetary policy there will always appear to be reasons suggesting it should continue to be used.

Europe is teetering on the edge. Germany has been that family member that worked hard and did good that all the loser relatives hit up for money. Germany just closed their wallet. Timmay flew over to ask them to keep playing along and they said "scheize."

[IBCoupe]

...but unfortunately, I don't like any of the current contenders on the right. They all scare me a bit.

That's why I don't think President Obama's on his way out. At least not yet. It's way too early to tell, but can you see the right being energized enough and the left/center being worried not too much about any single candidate in those debates? President Obama has to lose to someone, and I really can't figure out who he'd lose to.

Look at the front runners: Perry frightens the left and worries the middle ("...another Texas cheerleader governor? We tried this once."), which would make independents split and energize President Obama's base. Romney simply doesn't excite the right enough to get out the vote to win. It's possible it's going to be a close election (I'm having trouble seeing that), but it's also possible that President Obama could coast to reelection.

[bigbadberry3]

Soooo I ask, what should be done by the US. We all know the problem, but all we do is waste time. Can I get some actions here?

[IBCoupe]

That's why I don't think President Obama's on his way out.

I take it back. Talking with TMS in another thread, I think I convinced myself that he is on the way out. I don't think Europe's going to bail out Greece, and then Greece won't be able to pay its banks. And then its banks won't be able to pay anybody else. And then the banks they owe throughout Europe are going to have their next crisis, and then that's going to slip the world back into another recession. President Obama will get the blame (though it's not anywhere close to being his fault), and he'll lose re-election to probably Mitt Romney. Rick Perry might hold onto his lead in the primaries, but once the recession hits, Mitt Romney will look to the Republicans the way he's looked to the rest of us: as the more capable economic mind (or, "more capable mind" period), and he'll eventually get the nod. President Obama's base will be disheartened when they're not looking for work, and the TEA Party will be angrier than ever. If the Republicans can hold onto the TEA Party anger and focus it towards voting for Romney (rather than writing in Ron Paul), President Obama will be out of a job come January 2013.

Unless I'm wrong.

[themadscientist]

While I like Ron Paul and am interested in John Huntsman, I must agree with IB here. Romney does not pass the Republican litmus test. The attitudes that caused him to lose the nomination to McCain in 08 have only become more polarized. The focus on Perry suggests the Republicans are still not getting it. If, they went against their, I won't call them core, but certainly a very vocal constituency, and tapped Romney, he would get a lot more acceptance in a general election. I don't think he is the best candidate, but I do think he would have the best chance of defeating Obama. Perry would get a lot of "not Obama" votes, but Romney would get more positively-influenced votes; people voting for him, not against the other guy.

[IBCoupe]

And it's those positive votes you need to be an effective leader, post-election. I guess if Perry gets the nomination, President Obama will have a chance. I don't know if it's a good one, but it's there.

[themadscientist]

If he picks Ron as his VP and let's him tackle congress on monetary policy I would vote for him.

[themadscientist]

Lloyds of London decides European debt is too risky, pulls investments.

http://business.financialpost.com/2011/ ... om-europe/

“Given the uncertainty around the euro zone, it’s only natural that we would seek to reduce any potential downside risk. As a result, we’re not holding government debt of any peripheral EU country and have sought to reduce our exposure to banks in these countries,” Lloyd’s Finance Director Luke Savage told Dow Jones Newswires on Wednesday.

Things are heating up.

[Encryptshun]

To hell with gold. I'm packing up the car and moving the family down to the farm in Missouri. We've got cattle, crops, goats, our own fuel tanks, ponds stocked with fish, and lots of guns.

[themadscientist]

Not a bad idea to keep on the back burner. The PM markets are dropping as people flock to the dollar away from the euro. It's a short term trend and soon those investors will realized that bag they jumped out of the plane with was not a parachute, but a sack of bricks.

[RCA]

Things are heating up.

I turn on CNBC and all I hear about is "Asia is slowing down", "the FEDs speech was a very bad thing", "possibility of Asian housing crisis", "possible Euro depression and a double dip recession for the US" etc...

W T F !

[IBCoupe]

In anticipation of next week's (next month's?) European crash, I spread out my existing retirement savings away from my employer's stock and into a variety of conservative investments. Still buying into the stock and will be all the way down.

Worldwide economic crisis = Congressional retardation = Budget tightening = Defense Contractor stock drop = layoff fears = more stock drop...

[Eikon]

All I can tell is that being in the USA doesn't seem quite as bad now as it did a year ago. Sounds like EU and Asia are going to have a rough couple years.

[Encryptshun]

I think it's fair to say that everyone is going to have a rough couple years.

[themadscientist]

All I can tell is that being in the USA doesn't seem quite as bad now as it did a year ago. Sounds like EU and Asia are going to have a rough couple years.

Read...

http://www.thenewamerican.com/economy/s ... anks-again

To the list of mega-corporations bailed out by the U.S. government, we now must add — Europe. In an announcement that rocked financial markets worldwide, the European Central Bank revealed yesterday a concerted effort in combination with four other major central banks — the Bank of England, the Bank of Japan, the Bank of Switzerland, and yes, the U.S. Federal Reserve — to use dollars rather than euros in an attempt to paper over the European Union’s economic woes.

That's our money.

Silver still dropping, buying opportunity still open.

[rc1honda]

Sorry for a old bump but a very familiar and very dangerous issue has arisen way earlier then the American people were told.

President Obama is jockeying into position to propose yet another increase in the debt ceiling another 1.3 trillion.
If we remember it was just months ago when Capitol Hill went into a standstill on this issue and when it finally was approved the American people where promised it will have been enough to reign in spending, not default on it's loans and finally start to cut the debt. They also said it would be enough to easily last our government 18 months. It has been less the 6 months and the American debt is in danger of defaulting again.

This will bring the Debt up to 16.6 trillion dollars. The interest on the loans themselves are becoming unpayable. Coupled with the stall in employment, and slow moving economy i see this at the first of series of devastating blows to the US dollar and the state of our economy.

Now I don't think that this one debt raising will have any real tangible effect. I just think this is a dangerous precedent and it really shows the carelessness with which our government is handling the very real problem. At this rate the national will Debt will be at 25 trillion in 5 years. It's completely reckless the way our politicians our handling our currency. Couple this with the new possibility of war in Iran and it paints a very bleak future for Americans.

[themadscientist]

It will be the whole world that suffers. My attitude on this collapse has gone from worry and loathing to frustration and just thinking "let's just get it going already." I don't mean that from a negative perspective. It would of course be a terrible thing, but it's inevitable and I'm starting to move past the initial event and even the dark times to what will come after. My faith in the worlds' peoples' ability to drag themselves up out of it in maybe a decade increases daily. There is a positive aspect to the collapse of this ponzi scheme. Sound economics will reassert itself and that will start us on the road to a new evolution of our world.

Get ready for the ride!

[Chaotic_Warlord]

A world wide great depression, civil unrest, a very very real threat of WWIII from multiple countries and a extremely high likelihood of another American Civil War as the the Presidential elections start to really wind up and the Occupy & Tea Party nutjobs face more and more resistance and become violent and dangerous.

I'm starting to get very concerned with how 2012 will develop.

[themadscientist]

Don't forget a new Rebecca Black album is due out too. Damned Mayans might have been right.

[themadscientist]

European debt is downgraded now.

http://bottomline.msnbc.msn.com/_news/2 ... bond-talks

Friday the 13th was not a good day for Europe.
In the midst of the European trading day, news began circulating that credit agency Standard and Poor's would downgrade many eurozone countries, including France, Italy and Spain. Given Europe's deepening financial problems, that move had been widely expected.

S&P, which took away the cherished AAA rating from U.S. government securities in August, took the same step with France Friday, cutting the rating one notch to AA+.

S&P also downgraded eight other countries, including Austria and Slovakia by one notch and Italy, Spain and Portugal by two notches. Cyprus, Malta and Slovenia were also downgraded. S&P gave a negative outlook to 14 eurozone countries, meaning there is a one-in-three chance they could be downgrded again in 2012 or 2013. Only Germany and Slovakia were given "stable" outlooks.

This will hurt US exports which will kick this duct-taped together economy square in the nuts. If you drank that rosy economic outlook s*** the government was pushing you should start to feel the numbness by now.

Cover you asses people because here comes that double dip and we all know only the rich and powerful waltz through that unscathed.

[Eikon]

I don't think this was any big surprise to anyone.

I don't see how this hurts US exports enough to send us back into recession?

[Jesda]

The GOP is about to nominate its own John Kerry. It would take a catastrophe for this president to not be reelected. I suspect it'll be a difference of 100 or more electoral votes in Obama's favor.

[themadscientist]

We never really got out of the recession. They just fudge the numbers more and more each time. Any real gains have been cautious and based more on blind faith than real economics. Any "recovery" based upon such dubious means is vulnerable to any major events.

[themadscientist]

Well, it's been a while. Jesda's words were proven prescient just a few days ago, but we are not going to talk about the election. Head over to our politics forum for all your angry posting needs. Back on topic, some interesting developments in the world of high finance.

Basel III
This new set of regulations was spurred by the global financial crisis of 2008.
http://www.cfr.org/economics/basel-comm ... /p28694#p5

The global financial crisis of 2007 to 2009 generated fresh pressure for international regulations to protect against future meltdowns. One body that took on a more wide-reaching role was the Basel Committee on Banking Supervision, long considered a private club for the world's leading central bankers. The committee's most sweeping accomplishments have been the Basel rules on banks' capital requirements, which culminated in 2010 with the development of the Basel III accord on capital and liquidity standards. However, many national governments are facing significant resistance from the international financial sector, which has argued that the Basel standards will slow growth and damage the fragile global economic recovery. Other critics say the framework does not go far enough to stem risk in the international banking system.

America cannot comply
http://business.inquirer.net/92286/us-n ... s-treasury

WASHINGTON—The US Treasury announced Friday that it would not implement the Basel III rules for strengthening banks on January 1, saying the banks were not yet ready to meet the tougher capital standards.

“Many industry participants have expressed concern that they may be subject to a final regulatory capital rule on January 1, 2013, without sufficient time to understand the rule or to make necessary systems changes,” the Treasury said.

There could be ramifications
http://www.reuters.com/article/2012/11/ ... 3F20121104

New rules forcing banks to roughly triple the size of capital buffers they hold are set to be phased in over six years starting in January, after each country has finalized its own version.

But the United States and Europe, home to most of the world's largest banks, are still at the drafting stage, prompting speculation that the Basel III timetable may be postponed.

Juan Manuel Valle, head of banking supervision at the Mexican Treasury, said no country had suggested a delay but any that failed to meet the deadline would face pressure from their peers.

"For the ones that don't have regulations in place in January, the question will be, what kind of punishment will they face?" he told Reuters on the sidelines of Group of 20 meetings, adding that details would only be worked out after countries become "non-compliant."

Now, part of Basel III that I would like to focus on is the increased requirements for Tier 1 assets in portfolios. Tier 1 assets are considered the least risky and are thus weighted at 0% when grading an institutions financial rating. Discussions about the standard got interesting over the summer.

http://dailyreckoning.com/gold-just-became-money-again/

At the top of the proposed changes is the new list of “zero-percent risk weighted items,” which now includes “gold bullion,” right after “cash.

Wait, what? Gold? that's that silly metal that pirates like! That's old news!

Yes, it has been out of the news for a very long time and the continued rise in the value of it downplayed as a "bubble" often by the same people who didn't seem to think the housing market was suspicious at all.

Now if this rule is codified into the Basel III standard banks will suddenly be very interested in acquiring and holding gold in their portfolio, something countries around the world have been busy with for the past several years.



Time is short, January 1st is the date for roll out of the standard. What's in your wallet?

[Jesda]

The GOP is about to nominate its own John Kerry. It would take a catastrophe for this president to not be reelected. I suspect it'll be a difference of 100 or more electoral votes in Obama's favor.

I shuddered when I reread my post.

TOO REAL.

[RCA]

Not sure when you wrote that but 3 months prior to the election, most people could have called it.

[Jesda]

January