Thursday, November 19, 2015

The Illusion Of Prosperity........DO NOT MISS THIS!

The Illusion Of Prosperity

Between Reality TV and Social Media, no one will ever understand what is really happening. 

Sadly that is all most people in the West are exposed to. 

Neither ordinary people nor those that are better-off understand that the world is living on borrowed time. 

For about a hundred years the world economy has lived on a lie and a corrupt financial system based on few real values but instead on printed money and a fractional-reserve banking system. The synthesis of these two elements has created a perceived prosperity unprecedented in history. Little do people understand that the false wealth and high standard of living have not been produced with honest work or investment but with printed money and credit that have created the illusion of prosperity.

When the Federal Reserve was created in 1913 by and for the benefit of private bankers, world debt was negligible. It grew slowly until Richard Nixon realized in 1971 that the U.S. economy could survive only if money was created out of thin air. From then on the United States started in earnest to take advantage of its status as issuer of the reserve currency of the world by printing worthless pieces of paper that they called money or dollars. But it was not until the real master of Fed-speak and financial gobbledegook came on stage that the world abandoned any notion of sound money and entered the era of financial fantasy. Alan Greenspan had his own language, a language that nobody understood but everybody loved because with brief exceptions he managed to create a false prosperity that everyone believed was real. He was a master of financial repression, setting interest rates at levels that had nothing to do with economic realities but that created a bonanza in credit expansion and stock market euphoria.

Before Greenspan became chairman of the Fed, he had been a proponent of sound money, which meant he had a clear understanding of the importance of gold. But as soon as any sane person assumes a political role, any values or principles he had disappear. 

The role once in a position of power is to assist the government to buy votes and to pass the baton without serous mishaps. 

And so Greenspan did. His successor, Ben Bernanke, was the most productive government shill in history. During his reign U.S. federal debt went from $8 trillion to $17 trillion. It took the United States more than 200 years to go from zero debt to $8 trillion, but Bernanke managed to more than double the U.S. debt in eight years.

The world followed the U.S. lead and between 1990 and 2015 world debt went from $35 trillion to $225 trillion, a six-fold increase. 

At the same time world GDP increased by less than three times. This is the law of diminishing returns or, in layman's terms, pushing on a string. 

The world needed to create more and more money just to stand still. But now we are at a point when even exponential credit creation leads to a negative return.  

Virtually all indicators for commerce between countries are now showing a substantial contraction. The Baltic Dry Goods Index is at its lowest level in history. The China Container Freight Index is down 50 percent since its 2011 peak. Chinese exports fell for the fourth month in a row in October, down 7 percent. And Long Beach empty containers are at the highest level since 2006. Freight on U.S. railroads has seen the biggest fall since 2009. And U.S. truck loads are down 60 percent since 2014. THE TRUTH IS VERY EVIDENT!

All these statistics are indicators of real economic activity. This is very different from manipulated official statistics like U.S. unemployment, which shows a false improvement, overlooking the 94 million people who have no job, and that for the up-to-55-year-olds, 119,000 jobs were lost and the only jobs gained were for the over-55 or fabricated jobs (145,000) based on a theoretical model assuming eternal job expansion.

The world has reached a stage when all the king's horses and all the king's men cannot put things back together again. We have reached the end of the road where all the trickery of governments and central banks will be revealed as just a temporary postponement of the final collapse.

The World Is Now On The Edge Of Total Economic Collapse!

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