US, world headed for 25 year depression: Jim Rickards

US, world headed for 25 year depression: Jim Rickards

“When I use the phrase 25 year depression, it sounds extreme but it’s not. We had a 30 year depression in the United States from about 1870 to 1900…The Great Depression lasted from about 1929 to 1940. The U.S. is in a depression today.” Well, it's been in the works for

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Canadian banking haven myth exposed

Canadian banking haven myth exposed

"One of the reasons that Canadians (and international commentators, other finance ministers and global financial institutions) buy this Canadian banking fairy tale is the way the government accounts for the money borrowed to support the banks." The sorry spectacle of Conservat

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Get rid of your mortgage, loans, because interest rates set to rise

Get rid of your mortgage, loans, because interest rates set to rise

Get rid of your loans, guys and gals, because we are going into a high interest rate period. Very high. It will be the equivalent of going into the double digit interest rates we had in the 80s where many people threw their house keys at the bank and we had record numbers of ba

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E-cigarettes save lives, money

E-cigarettes save lives, money

"We know that cigarettes have thousands of chemicals in them and we know that they are killing us. They have been for over a hundred years. So now, the e-cig industry comes along with only one or two chemicals in their mixture and people are freaking out over these as well. Whe

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US inches closer to big bank charges

US inches closer to big bank charges

Federal prosecutors are nearing criminal charges against some of the world’s biggest banks, according to lawyers briefed on the matter, a development that could produce the first guilty plea from a major bank in more than two decades. In doing so, prosecutors are confronting

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Canada’s home sales top predictions; why a real estate crash is inevitable

Canada’s home sales top predictions; why a real estate crash is inevitable

“The assurance of relatively low borrowing costs has likely given home buyers confidence while rising home values have kept new listings at a healthy level. Stable employment has provided some assurance to owners and buyers alike.” Our website is back after many months of

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Comparing today’s recession/depression to the 1980 recession

Comparing today's recession/depression to the 1980 recession

"Much like today, Americans were concerned not only with high unemployment but increasing budget deficits in the early 1980s. A September 1983 Gallup poll found that three-fourths of the public agreed that the federal government's budget deficit was a great threat (42%) or some

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Why savers are getting screwed

Why savers are getting screwed

"Without the intervention of economic policymakers, interest rates would be naturally higher. That would increase the cost of borrowing for businesses and consumers, but there would be some offsetting economic benefits. Savers are getting screwed by the current monetary policy

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Geithner admits USA bankrupt to US Senate

Geithner admits USA bankrupt to US Senate

"Never in our history has Congress failed to increase the debt limit when necessary. Failure to raise the limit would precipitate a default by the United States. Default would effectively impose a significant and long-lasting tax on all Americans and all American businesses

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World economies on verge of currency revaluations to deal with debt

World economies on verge of currency revaluations to deal with debt

"It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning." -- Henry Ford Basically what the world central banks are doing is increasing their money by devaluin

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Is Obama the next Mugabe of Zimbabwe?

Is Obama the next Mugabe of Zimbabwe?

"America, Britain, Japan, Germany, France, Sweden, Holland, Norway, Canada and Australia make up the Fishmongers Group and their meeting on Tuesday will deliberate on the state of the inclusive government, debt relief, public finance administration and the controversial economi

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US raiding foreign countries with dollars, not soldiers

US raiding foreign countries with dollars, not soldiers

""The United States is going to China and saying: we want you to commit economic suicide, just like Japan did. We want you to follow the same thing: we want you to revalue your currency, we want you to squeeze your companies, we want you to go bankrupt,” says Michael Hudson,

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hyperinflation photo silver coin investor

“There might not have been a second round of quantitative easing, if Federal Reserve Chairman Ben Bernanke shopped at Walmart. A new pricing survey of products sold at the world’s largest retailer showed a 0.6 percent price increase in just the last two months, according to MKM Partners. At that rate, prices would be close to four percent higher a year from now, double the Fed’s mandate.”

The real scary thing is that anyone who thinks they know what is going to happen is a fool and there seems to be a lot of that going around.

A new pricing survey of products sold at the world’s largest retailer [ WALMART] showed a 0.6 percent price increase in just the last two months, according to MKM Partners. At that rate, prices would be close to four percent higher a year from now, double the Fed’s mandate.

The market is essentially chaotic and we can mean that in the true mathematical way – just like the weather. The basic mechanism is that things are so complicated with so many feedback paths – this goes up, that goes down, so this goes up, so the first element goes down, etc.,etc.,etc. The orderly market concept might have had some validity 100 years ago but we have an economic structure of such complexity where people are buying financial instruments that are so divorced from reality very few people understand what the heck is going on.

There are some basic rules when dealing with chaotic systems:

1. They can change from one stable state to another equally stable state essentially instantaneously. Depression of 30′s, today.

2. The more energy you put into a system the more likely it is to change state. – what we’ve had in the 2000′s.

3. The more you think you can react appropriately to fix things the more likely it is going to get worse.

Here’s how it works: The US Treasury prints a few billion dollars worth of bonds that the Fed agrees to purchase. The Fed then prints the money and gives it to the Treasury Dept for deposit in government bank accounts. No big cost, just the expense of paper and ink plus some labor. The Feds money presses are really fast so labor is minimal in keeping with the philosophy of the wealthy elite that actually own the banks.

Now here’s the next part of the scam – the Fed then sells these bonds to investors, other banks, and pension funds through member banks for real money. The member banks get to charge an appropriate commission so they make money as a direct result of this enterprise. If they can sell to foreign banks and investors they make even more on the exchange rates.

Now here’s the really sweet part. The US Treasury pays the interest and redeems the principal on the bonds held by the investors that purchased the bonds. Notice how the Fed gets to keep the money that they sold the bonds for. It’s just a sneaky way to effectively print money and give it away to the big banks that own the Federal Reserve.

Know what the government is up too or get burned. Government is really trying to spike inflation to reduce value of debt. That is, pay back current debt with future dollars that have less purchasing power.

Don’t think of oil going up or down, a barrel of oil is the same today as it was in 1920. Difference is it takes more depreciated dollars today to buy the same barrel of oil. Oil didn’t go up in price, the dollars value became less. Now if they can stick you with a low yield bond setup and buy oil, they get the value you get the depreciation of the currency. Government is trying to pull a fast one. Intelligent investors are out of bonds altogether. Simply not worth the risk/yield.

National Inflation Association projects massive food price hike

NIA projects that at the average U.S. grocery store it will soon cost $11.43 for one ear of corn, $23.05 for a 24 oz loaf of wheat bread, $62.21 for a 32 oz package of Domino Granulated Sugar, $24.31 for a 32 fl oz container of soy milk, $77.71 for a 11.30 oz container of Folgers Classic Roast Coffee, $45.71 for a 64 fl oz container of Minute Maid Orange Juice, and $15.50 for a Hershey’s Milk Chocolate 1.55 oz candy bar. NIA also projects that by the end of this decade, a plain white men’s cotton t-shirt at Wal-Mart will cost $55.57. Read the rest of the document:


The American consumer is beig encouraged to spend their way out of the current situation. Unfortunately the consumer’s good eyesight is keeping them from making that “leap of faith”.

  1. They see the “pillars” of the American economy are fundamentally unstable and tottering badly.
  2. They see the obscene government deficit but know its 3 major expenditures (military, education and medical) are politically unassailable.
  3. They see the jobless “recovery” and know the real unemployment rate is twice the official one.
  4. They see the current fiscal policy must result in either inflation (possibly hyper-inflation) or deflation.
  5. They see that 53% of all US mortages exceed or equal the current market value of the house…and know even a small further drop could bring foreclosure to the door of half of all American homes.

The American consumer is seeing things very clearly. They are angry at their politicians and very worried about their personal assets/wealth. They know their nation is at a tipping point, with third world life-styles awaiting for the masses. Surely it cannot be a surprise that low interest rates and gobs of money crying out to be borrowed is not “stimulating” them to go out and buy, buy, buy.

Related posts:

  1. Food inflation will appear next in the USA“It is our belief that massive price inflation has already begun.”– PR Newswire Just remember people, you can only store so much food for so long. It is very important...
  2. Export bans, increasing protectionism major reason for food inflation“Zoellick said he expects food prices to continue to rise, and that export bans and weather disruptions are partly to blame.” He also said global food prices have hit “dangerous...
  3. Official Canadian inflation rises to 2.4 percent; real inflation close to 10 percent“Inflation came in hotter than expected. Markets were expecting to see a 2.2% increase in headline inflation but it came in at 2.4%. The more important piece of information is...
  4. Venezuelan inflation rate hits 30 percent; South American currency planned“That’s an incredible surge,” Adrian Aguirre, an economist at Caracas-based Bancaribe SA, said in a telephone interview. “The fact that food prices rose by more than 11 percent is something...
  5. Analysts See USA's Future And It Is JapanHoward Davidowitz sees a similarly horrific future [similar to Japan and Zimbabwe] in store for the U.S. He calls America’s current path, rich in deficit spending and weak in currency...
  6. Jim Rogers: Fed understates inflation“If the world economy gets better, commodities are going to go up in price because there are shortages. If the world economy does not get better, you should own commodities,...

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