Reagan's ex-budget director hasn't been reading my blog....

…but he’s now writing pretty much the same thing I have been writing for years.  Of course, he has credentials where I only have math, logic and history to support my views.  David A. Stockman is a former Republican congressman from Michigan, President Ronald Reagan’s budget director from 1981 to 1985 and the author, most recently, of “The Great Deformation: The Corruption of Capitalism in America.”  You might want to read his latest article since it's getting so many eyes upon it due to being in the New York Times:

http://www.nytimes.com/2013/03/31/opinion/sunday/sundown-in-america.html?pagewanted=all&_r=2&

 To recap some of the most important points (but not all of them):

• The stock market recovery has been bought by the Federal Reserve by scooping up assets at full price and putting them on its books in the hope of holding them off the market (and therefore not subject to deflation) for the term of the underlying loans.  The fed used to hold only 500bn of safe assets on its books. Now it has 3.2 trillion of crap assets.  If it ever has to sell some of them (and eventually it will), the prices of these assets will fall through the floor because there will be no greater fool (con man) than the fed to buy them.

• The argument for buying these crap assets was to support confidence which would cause people to borrow even more money and thus grow the economy (errrrr, Ponzi).  But for all the fed’s buying the economy has been growing at the slowest rate since the civil war. Real median family income growth has dropped 8 percent, and the number of full-time middle class jobs, 6 percent. The real net worth (buying power) of the “bottom” 90 percent has dropped by one-fourth. The number of food stamp and disability aid recipients has more than doubled, to 59 million, about one in five Americans.  Bottom line, Keynesianism appears to work for a while just like a Ponzi scheme appears to work for a while.  But both are confidence games that collapse when the people lose confidence in them.

• The fed is the lender of last resort in the debt Ponzi.  When the fed is no longer able to convince more people to take on US debt with nearly 0% interest returns, there will be no “next step” or “backup plan” or anything else.  The Ponzi will collapse.  The longer we wait for this to happen, the bigger the bubble will get and the more dramatic the collapse will be.  Don’t think we can’t make it worse.  Things can always be made worse.

• “We’ve been living on borrowed time — and spending Asians’ borrowed dimes”.

• The real 10 year forward looking deficit (AKA additional debt) in the coming years will far exceed the CBO’s $7.5 trillion estimate.  As I have written many times, the growth has to be exponential (on average) else the Ponzi will collapse.  Stockman sees a $30 trillion debt by 2023.  Without any change in our productive output, that would put us at a debt:gdp ratio of 150% which is where 3^rd world nations generally get cut off from more loans by the IMF.  That, of course, discounts the coming drop in GDP that will occur when government runs out of free money to spend into the economy.  Before this is over, the debt to GDP will be 400% IMO.  Nobody and I mean nobody is predicting that right now even though it is more than obvious to anyone who can do math.  Since debt was used to goose the GDP, when we can no longer goose the GDP using debt, the GDP must collapse.  But the debt will remain.  This is the nature of the so called debt death spiral that marks the final days of the collapse of the debt Ponzi. 

While Stockman gets closer to the truth than perhaps any article I have read to date, he still never makes the final step to reach the most important conclusion that the culprit of all of this is none other than fiat currency and fractional reserve banking.  It is a scam of such ridiculous proportion and of such far reaching consequence that those pushing it upon the peoples of the world are in fact mass murders, traitors and economic war criminals.  Yeah, it sounds ridiculous to say so now, I know.  Too much of my stuff tends to sound like that to normal, hard working people who have not had time in their busy lives to do their homework. 

 

But don’t let that fool you.   The elite know where this is going and they are preparing.  They have already robbed us silly on paper.  Soon they will steal us blind in actual life and then when we start to protest they will keep us in check with 1.7 billion bullets and 3000 MRAPs (just the start).  At some point they worry that even with the application of military force on the people that we will stop being scared of their "military training exercise" fear tactics. 

 

Of course, the problems will not just be between US government and US citizens.  This is a global debt Ponzi, not a localized US one. Whole countries will end up getting screwed out of many years worth of labor.  When the ensuing $hit storm gets too big they plan to abandon us.  In the words of Men At Work, "They've built castles underground for the rich, politically".  In the US we call them D.U.M.Bs  (Deep Underground Military Bases).  Yes, they exist.   No, you are not invited.  Yes, they are using your money right now to stockpile supplies in them.  No this is not a theory of any kind.  Yes this is what I would do if I were a scum bag con man who had conned the world into a pile of debt whose collapse carries the significant possibility of global war being used to settle accounts.  It doesn't mean it will certainly happen, only that there is enough of a chance of it happening that those who don't have to work for a living are preparing their golden parachute.  Similar "end of the world" activities are happening all over the world.  Some are hidden, some are in plain sight.