Liberty Phoenix

New, Hard Evidence of Continuing Debt Collapse!

http://www.moneyandmarkets.com/new-hard-evidence-of-continuing-debt-coll...

We are governed through our perceptions. Sooner or later, reality will intrude and people won't understand what went wrong until it's too late.

In this (1hr 30min) video from the Pikes Peak Economic Club, Jeff Wright shares his experience working with the financial industry.

The charts and powerpoint presentation referenced in this video are available here:

• Keynesian Charts
• Powerpoint Outline

If you've ever watched Mad Money, with Jim Cramer, then you probably hate the guy. It's hard not to. If you've ever watched him several days in a row, then you know how both how full of shit he is and how broke his fans must be. In this interview, Jon Stewart is once again proving to be the spiritual successor of Tim Russert, even surpassing him at times.

Part 1 (05:47)

Part II (08:24)

Part III (08:31)

Cooking the numbers and risky investments have contributed to the underfunded pension fund fiasco:

http://www.bloomberg.com/apps/news?pid=20601109&refer=home&sid=alwTE0Z5.1EA

Most young people aren't promised a pension anymore and they certainly can't count on the looted Social Security "trust" fund to be there. Now the older generations, whose recklessness has destroyed the economy and any hope for the younger generation to save enough to compensate for their lack of retirement benefits, are once again looking to the younger generation to bail out their underfunded pension funds, so that they can retire in the style they've become accustomed to. When will the shamelessness stop? When will this game of musical chairs finally come to an end?

Then consider this headline:

Zimbabwe stock exchange resumes trading, in US dollars

I call it the McDonalds laugh. Good for a moment, until you feel that pit in your stomach when you realize what the Zimbabweans are in for. Their timing could not have been worse. Or course, we will all be in this together, soon enough.

When Vladamir Putin is warning the United States about the perils of socialism, you know that we are in trouble.

http://www.therightperspective.org/?p=1472

Torture, "preemptive" war, the suspension of habeas corpus, spying on our own citizens, socialism -- is there any evil, that we had once opposed, that we have not come to embrace? When will Americans stop cheerleading the government and come together to clean house once and for all? When when the evil be considered too intolerable to hide our heads in the sand anymore? I suspect we will soon find out once enough people lose their sandboxes to the bank.

Hmmm, what a surprise! China is starting to worry where this borrowing binge might be taking them.

http://www.bloomberg.com/apps/news?pid=20601080&sid=a_dsDz145J_A&refer=asia

I can understand why China might be worried about their dollar denominated holdings, but I'm not sure what they are expecting us to do about it. The only way that we could guarantee the value of their holdings is to promise them that we'll borrow the money from them to make up for any lost value later on. I think this pyramid scheme is starting to look more like an Ouroboros.

When we buy goods from China, their Central Bank keeps those dollars as foreign reserves and prints new yuan to pay their exporters. This naturally has an inflationary effect on their economy. As Americans shift more towards buying cheaper goods here at home, this inflationary effect should accelerate in China. Will this trend, combined with other Chinese regulatory trends designed to combat deflation, ultimately lead to a hyperinflationary scenario? Will the Chinese sacrifice the dollar in order to fight inflation on their shores? And what will the effect be on the prices of all those cheap Walmart products that Americans have come to depend on? One author has an interesting take on it:

http://www.marketskeptics.com/2009/01/hyperinflation-will-begin-in-china...

Whether inflation is exported along with Chinese goods or it comes out of our need to monetize the debt, when they inevitably stop buying it, the next few years will no doubt be very challenging here in the U.S. and in China.

Are you a herd animal or a human capable of independent thought? Do you deny objective reality in order to better fit in? This study claims that deviation from group opinion is regarded by the brain as punishment:

http://www.cnn.com/2009/HEALTH/01/15/social.conformity.brain/index.html

That would certainly help to explain why the cattle of this country seem so intent on stampeding off a cliff.

Building a unanimous consensus on any issue, has typically been an exercise in futility. However, in watching the main stream news lately, one might come to the conclusion that we have finally resolved all points of contention here in the United States. Exploring both sides of an issue is considered a waste of time for most of our news critters. After all, we are told that Americans are tired of partisan politics and that we must come together to solve the near insurmountable challenges we face. It sounds reasonable on the surface, but only if you accept the assumption that our politicians were in any significant disagreement in the first place.

Listening to talk shows, Republicans and Democrats do frequently argue with each other about what is best in theory, but when it comes time to vote they, more often than not, choose to agree for the sake of practicality. The theories that each side espouses are always confined to their campaign rhetoric and rarely culminate in any sort of legislative action. Both sides are guilty of this, leading to the frustration of liberals and conservatives alike.

The two most obvious examples of this pertain to war and the economy. Liberals elect Democrats to end wars, and act shocked when their guys vote to continue them. Conservatives elect Republicans to be champions of free-market capitalism, and act shocked when their guys vote to nationalize the economy. In both cases, the Republicans and Democrats argue that the immediacy of the moment prevents them from staying true to their core beliefs. Just like hypocritical parents, they call on everyone "do as they say, not as they do."