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Ah duh - the Federal Reserve will cut off the U.S. debt funding

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  • Ah duh - the Federal Reserve will cut off the U.S. debt funding

    I should have realized this earlier. It seems obvious.

    When The Financial Powers That Be (TFPTB) took down other nations, they had their major banks, such as Citi, BofA and JPMorgan, first extend much debt to the victim nation, then sharply cut off funding. This sent the victim into a financial crisis, leading to social unrest from out of work people no longer able to pay for their food, clothing or housing, and angry that some sort of banking fraud had deprived them of their savings. The crisis was resolved by the nation's political "leaders" signing over the country into debt slavery. Any property or future income stream worth mentioning was "privatized", going to one of a few corporate oligarchs. Any government social expense, such as welfare or pensions, was minimized, so that as much of the taxes collected as possible could go toward paying on the debt, to the afore mentioned banks.

    Well, the citizens of U.S. would not exactly accept being sold into slavery for debt owed to some banks. "Those are our banks; if they can't behave we should nationalize them and imprison their executive officers, not let them privatize us!"

    But it looks like we will accept being sold off into debt slavery over debts owed to the Federal Reserve, China and Japan.

    Recall that the Federal Reserve is another wholly owned subsidiary of TFPTB. In reality, though perhaps not some legal detail, it ultimately answers to the Financial Powers, not to the U.S. Congress. The U.S. Dollar is not really the "U.S." Dollar. They are "Federal Reserve Notes (FRNs)." The Fed, a wholly owned subsidiary of TFPTB, already has a de facto world currency, the FRN. The U.S. paper in this scenario is U.S. Treasury, Fannie and Freddie debt, and the U.S. is going down baby, down on its knees. So in the case of the U.S., just replace the afore mentioned banks with the Federal Reserve, rinse, lather and repeat, mutatis mutandis.

    So here's how I think it goes down.

    First we spend some more time piling up U.S. government debt paper on the books of the Fed.

    Then at some point, the Fed starts to complain that it can't keep piling on U.S. debt. This provokes massive sales of U.S. debt by the Fed, China and Japan, in some rapid sequence and no doubt with misdirection as to who sold what first. This body slams the U.S. debt paper market. The U.S. gets desperate quickly. Congress cuts payments wherever it can, in order to meet the rapidly increasing interest charges and to minimize accruing further debt. This pisses off the populace. When you're out of work, no longer collecting even a government benefit check and can't feed your child, you get riled up easily at any big shot institution that apparently stole your prosperity.

    This social unrest is already anticipated, and cracked down on hard by militarized police forces nation wide. Any citizen (or cow ?!) previously identified as someone unlikely to "get with the program" is likely to get visited late at night by some strong young men. Unfortunately, these men always seem to forget to bring the beer. If the Muslim nations from North Africa through to Indonesia haven't succumbed sufficiently yet (likely the case) then the U.S. finds or invents an excuse to escalate the wars on that front dramatically, as both a diversion from the home front and as a necessary step in bringing these Muslim nations on board (or deep sixing them) as well.

    ... the part above seems more likely to me, the part below more speculative ...

    This time, the U.S. President does not recall gold. He recalls the Dollar (which has just lost much value, due to the monetization of a substantial portion of the U.S. debt.) It is replaced by another instrument, perhaps issued by some other wholly owned subsidiary of TFPTB. The U.S. Dollar was already the nearest thing to a world currency. This exchange makes manifest what has been hidden this last century, that TFPTB issue the world's reserve currency. U.S. debt is partially defaulted in this exchange. That debt includes the Social Security "Trust Fund" IOU's issued by the Treasury; so Social Security payments are repriced downward as part of this. Any other pension funding within arms reach of Washington, DC gets hit as well. This Dollar recall allows further fine tuning of who wins, who loses. The Dollar swap is one-to-one for the new currency, to reassure Americans. The partial defaults come on the debt side, not the currency side. In particular, those lucky enough (the Fed, Japan and China, and a few big banks, I'd guess) to cash in on the above massive monetization get out one-to-one. Those still holding U.S. debt (e.g. the Social Security "Trust Fund") get short changed.

    Taxes, fees, gas prices and oppression go up; benefits and freedom go down.

    Gold fails as an insurance policy through this crisis, just as a fire insurance policy fails on your business, after the Mafia takes over your neighborhood, your local and state government and your insurance company. If I see the Fed start to seriously complain that it can't keep taking on more U.S. debt, then (if I still believe this conspiracy theory) I'm selling most of my gold and stocking my spare bedroom to the rafters with rice, beans, toilet paper, and, for trade, cigarettes and liquor. Of course I keep some gold; one never knows the future for sure, so should not put all ones eggs in one basket. Maybe I'll stock a few six packs of beer as well, just in case some strong young men come to visit me late at night. Hopefully there's a cute female in the visiting group.

    P.S. -- The escalation of the Middle East wars may happen sooner than suggested above, as part of increasing the U.S. debt burden. It seems that we (the U.S.) are already maneuvering for a war with Pakistan.
    Last edited by ThePythonicCow; 10-11-10, 06:56 AM.
    Most folks are good; a few aren't.

  • #2
    Re: Ah duh - the Federal Reserve will cut off the U.S. debt funding

    why would they go to he trouble of issuing a new currency and selectively default? If your going to selectively default why not just do it? And the author mentions that by that time the dollar has already lost alot of value (hence switching to new currency); in that scenario gold has already protected you....

    Comment


    • #3
      Re: Ah duh - the Federal Reserve will cut off the U.S. debt funding

      Originally posted by karim0028 View Post
      why would they go to he trouble of issuing a new currency and selectively default? If your going to selectively default why not just do it?
      Well, this was the part of my prediction I was less confident of.

      However, it still seems like an intriguing option to me.

      For one thing, it obfuscates the partial debt default, as a magicians often disguise their critical step with a sexy lady or a flashing distraction.

      For another thing, it demarks, for all the world to see, the "official" transition from an apparently U.S. currency to a more worldly currency. This further gives cover and justification for other steps to make a world monetary order de jure.

      It also allows side stepping the problem that not all the U.S. debt got the same treatment. U.S. debt held by China or JPMorgan gets a higher class treatment than that held by the Social Security "Trust Fund." A straight debt restructuring would have to make this manifest. By allowing the favored debt to cash out first, then anyone left holding U.S. debt can all be treated "equally."

      Originally posted by karim0028 View Post
      And the author mentions that by that time the dollar has already lost alot of value (hence switching to new currency); in that scenario gold has already protected you....
      Yes, it would be possible, with perfect timing, to hold gold a bit longer and hit the perfect peak. But as soon as the new currency is in place, many who had been holding gold as an insurance policy will want to cash out, causing a sharp drop in gold's price. I figure it would be better to sell a week early than a day late in this circumstance.
      Most folks are good; a few aren't.

      Comment


      • #4
        Re: Ah duh - the Federal Reserve will cut off the U.S. debt funding

        For another thing, it demarks, for all the world to see, the "official" transition from an apparently U.S. currency to a more worldly currency. This further gives cover and justification for other steps to make a world monetary order de jure.
        This part is actually quite important.

        The rulers always desire the coin of the realm to reflect their special position. We will not have a "real" world monetary system until exactly when we have a currency issued by a (more obviously) world financial organization. The Financial Powers That Be (TFPTB) seek no less. This must be their currency.
        Most folks are good; a few aren't.

        Comment


        • #5
          Re: Ah duh - the Federal Reserve will cut off the U.S. debt funding

          The key points of my theory, which might have gotten lost in the detail, are
          • that the Federal Reserve is fundamentally an institution owned by TFPTB,
          • that the Fed is collecting U.S. Treasury and other debt in great globs, and
          • that if this goes down for the U.S. like it has for so many other nations the last 50 years, the time will come when the Fed stops accepting U.S. debt, forcing a financial crisis and social unrest in the U.S., leading to
            • privatizing (selling to oligarchs) income streams,
            • selling off public property (to oligarchs) and
            • cut backs in social payments (aka austerity) the better to send most tax collections to oligarchs.

          The end result is a world monetary system (justifying other world-wide powers) and a U.S. in debt slavery.
          Most folks are good; a few aren't.

          Comment


          • #6
            Re: Ah duh - the Federal Reserve will cut off the U.S. debt funding

            Originally posted by ThePythonicCow View Post
            The key points of my theory, which might have gotten lost in the detail, are
            • that the Federal Reserve is fundamentally an institution owned by TFPTB,
            • that the Fed is collecting U.S. Treasury and other debt in great globs, and
            • that if this goes down for the U.S. like it has for so many other nations the last 50 years, the time will come when the Fed stops accepting U.S. debt, forcing a financial crisis and social unrest in the U.S., leading to
              • privatizing (selling to oligarchs) income streams,
              • selling off public property (to oligarchs) and
              • cut backs in social payments (aka austerity) the better to send most tax collections to oligarchs.

            The end result is a world monetary system (justifying other world-wide powers) and a U.S. in debt slavery.
            You are right that the FED is owned by TPTB, but it is also a legal fictional entity that was created by the will of congress... At some point the pain could get so great that the sheeple are actually getting slaughtered instead of just fleeced.... Whats to stop congress from dissassembling the FED under some sort of populist revolt? Its already happened twice in our history... Granted the american public is alot dumber than they were then, but hell you would have to be brain dead to not see your being fleeced when you catch the thieve with his hand in your pocket..

            Comment


            • #7
              Re: Ah duh - the Federal Reserve will cut off the U.S. debt funding

              Originally posted by TPC

              The key points of my theory, which might have gotten lost in the detail, are
              • that the Federal Reserve is fundamentally an institution owned by TFPTB,
              • that the Fed is collecting U.S. Treasury and other debt in great globs, and
              • that if this goes down for the U.S. like it has for so many other nations the last 50 years, the time will come when the Fed stops accepting U.S. debt, forcing a financial crisis and social unrest in the U.S., leading to
                • privatizing (selling to oligarchs) income streams,
                • selling off public property (to oligarchs) and
                • cut backs in social payments (aka austerity) the better to send most tax collections to oligarchs.
              The end result is a world monetary system (justifying other world-wide powers) and a U.S. in debt slavery.
              Perhaps you might elucidate in your theory why the rest of the world would want to accept a new world currency controlled by any one nation, when the old one just got repudiated.

              Once bitten, twice shy wouldn't you think?

              It is also unclear as to why TPTB - or the NWO - or whatever the mysterious benefactors/instigators of said present crisis, would choose to benefit China. China has not ever been an easily manipulable entity and understands full well the uses of sovereign power over non-sovereign entities.

              Japan also is very questionable as a creditor to the United States. Besides the military (or lack thereof) issue, Japan needs a friend as it is surrounded by much larger powers. The US, for historical reasons, has been that friend. The collapse of the US into a debt slave removes the US from this role - who then would replace them?

              China for very long standing historical reasons is the most feared. Russia is still involved in disputes over land. No one else has a Navy sufficient to matter.

              Comment


              • #8
                Re: Ah duh - the Federal Reserve will cut off the U.S. debt funding

                Originally posted by karim0028 View Post
                Whats to stop congress from dissassembling the FED
                Have you seen any evidence that such populism has more sway over Congress than does the Fed itself?

                When push comes to shove, in the heat of the moment, in a financial crisis of a few weeks duration, we already have excellent evidence -- Congress will answer to the will of the Fed and the Financial Powers, regardless of what the people think.

                The control of the Financial Powers and their associated oligarchs in key military, media, industrial and intelligence organizations is far greater than the last time that the U.S. disenfranchised a National Bank, back in Andrew Jackson's time, in the 1830's. No Presidential candidate vowing to remove the Fed's charter would get even close to the White House today, nor would any such political party get anywhere close to majority control of both houses of Congress. Such change in control of these political offices would require sweeping victories for a political party over at least two elections two years apart, both nationally and in most states; a political party that barely has any impact on the polls at all today. We're talking a crisis here that erupts in the space of a few weeks, after festering for perhaps a few months.

                Not a chance. Not even a remote chance.

                Even Ron Paul barely goes beyond suggesting he might hope to remove the Fed's charter, maybe. There is a vast distance between Mr. Paul retaining his Congressional seat and electing people who are openly and adamantly determined to disenfranchise the Federal Reserve (both in campaign promises, and in actual votes in the heat of crisis) to the offices a majority of the House of Representatives, 60% of the Senate, and the President.
                Most folks are good; a few aren't.

                Comment


                • #9
                  Re: Ah duh - the Federal Reserve will cut off the U.S. debt funding

                  Originally posted by c1ue View Post
                  Perhaps you might elucidate in your theory why the rest of the world would want to accept a new world currency controlled by any one nation, when the old one just got repudiated.
                  This new currency would not appear to be "United States" currency. It would be openly (rather than just covertly, like the Federal Reserve note) issued by a world (actually, by certain Financial Powers) body, likely under the auspices of or working with the G20.

                  Originally posted by c1ue View Post
                  It is also unclear as to why TPTB - or the NWO - or whatever the mysterious benefactors/instigators of said present crisis, would choose to benefit China. China has not ever been an easily manipulable entity and understands full well the uses of sovereign power over non-sovereign entities.
                  See the March 2009 article China eyes SDR as global currency. More generally, The Financial Powers That Be (TFPTB) seem to prefer China over the United States. They "work faster." See for example the recent interview in the German magazine Spiegel of IMF Director Dominique Strauss-Kahn , as linked from iTulip post Helicopter Ben prepares to strafe the economy with his next "money bomb" run....

                  Listen c1ue, listen, to so much of what is being said in the main stream these days. China (and Russia) are largely playing with the agenda of TFPTB, not against. It was Russia's Medvedev that flashed a possible new world order Gold Coin some months back. See also the positive press (e.g. China's Wen offers to buy Greek debt (Reuter's)) that China received a week or two ago for vowing to help out Greece by purchasing its debt. China is not complaining about world governance of our monetary system; China is complaining about U.S. debt. Currently, China speaks in line with TFPTB better than U.S. leaders.

                  Oh, and once again, may I remind the reader that my key prediction was that the Fed would openly stop monetizing U.S. debt, helping to cause a crisis. The replacement of the current Federal Reserve Note (ostensibly, though not really, a U.S. construct) with a world currency openly issued by some quasi-world (really TFPTB) body was a secondary, less certain, prediction.

                  (Yes, I realize that there is almost exactly zero chance of anything I say ever convincing yourself, c1ue, to openly change your mind on anything.)
                  Most folks are good; a few aren't.

                  Comment


                  • #10
                    Re: Ah duh - the Federal Reserve will cut off the U.S. debt funding

                    Originally posted by TPC
                    Listen c1ue, listen, to so much of what is being said in the main stream these days. China (and Russia) are largely playing with the agenda of TFPTB, not against. It was Russia's Medvedev that flashed a possible new world order Gold Coin some months back. See also the positive press (e.g. China's Wen offers to buy Greek debt (Reuter's)) that China received a week or two ago for vowing to help out Greece by purchasing its debt. China is not complaining about world governance of our monetary system; China is complaining about U.S. debt. Currently, China speaks in line with TFPTB better than U.S. leaders.
                    I have to say I disagree with your assessment of what is going on.

                    Russia, China, and some parts of Europe are clearly exiting the US dollar reserve currency regime but are equally not entering into a new reserve currency.

                    The deals that China has signed with Turkey and Brazil, for example, make no mention whatsoever of SDRs but rather create yuan/ruble and yuan/lira trading zones. Ditto for China's numerous other non-dollar trading zones.

                    Russia in turn is less eager for a straight ruble trading zone since they already have a common currency: energy and commodities. Russia's energy is devoted more towards removing the petro-dollar standard - a different leg of the US dollar reserve currency tripod.

                    From my view, the Russia and China SDR actions are purely maneuvering to ensure that the US is unable to use the SDR fig leaf to continue its 'print and spend' actions.

                    By insisting on increased ruble/yuan presence in the SDR - and not coincidentally reduced US/UK control over the IMF and World Bank - the effect is to neutralize these institutions as acceptable alternatives to the US dollar reserve currency regime.

                    So your theory might be completely correct in terms of what is happening in the US and UK, but equally not correct with regards to what the world economy will look like in 3 to 5 years.

                    Comment


                    • #11
                      Re: Ah duh - the Federal Reserve will cut off the U.S. debt funding

                      I have to say I disagree with your assessment of what is going on.
                      Well, I knew you would.

                      For the third or fourth time, my primary prediction was that the Fed would (perhaps covertly) be the one to cause a run on U.S. debt, after it accumulates some more of it.

                      The world currency situation, present and future, is more controversial, that I agree. Points and counter-points can be made for just about any view.

                      By insisting on increased ruble/yuan presence in the SDR - and not coincidentally reduced US/UK control over the IMF and World Bank - the effect is to neutralize these institutions as acceptable alternatives to the US dollar reserve currency regime
                      The key question in all this, the fundamental decider (no, not George W Bush) is whether the U.S. national interests or The Financial Powers That Be (TFPTB) power and monetary interests, are the final decider.

                      If it is TFPTB, as I am forecasting, then once the U.S. national debt is body slammed, it won't matter so much what the U.S. wants. It will be bend over time for Uncle Sam.

                      If it is the U.S. national interests, as almost every other sentient human on the planet is forecasting, then you're likely quite right.
                      Most folks are good; a few aren't.

                      Comment


                      • #12
                        Re: Ah duh - the Federal Reserve will cut off the U.S. debt funding

                        One more twist to my theory: the rising ruckus we are now seeing in the mainstream media over currency and trade wars is likely the mime that marks the clear increase in U.S. domestic prices for all things imported. The American people are being setup to be angry at this or that foreign nation, while the inflation gets significantly more painful.

                        My theory requires a crisis in the week-to-week budget of most ordinary Americans, even to finance basics of food, clothing, shelter, cable TV and cell phone (grin). More outgo, less incoming, until a sudden and critical U.S. debt crisis causes a dramatic drop in any remaining income. Squeeze, squeeze, until they are about to scream, then punch them in the gut. They they riot, and we get our social unrest, domestic crack-down, austerity (reduced government benefits, increased taxes) and the selling (privatization) of every thing and every income stream to various TFPTB interests.
                        Most folks are good; a few aren't.

                        Comment


                        • #13
                          Re: Ah duh - the Federal Reserve will cut off the U.S. debt funding

                          Originally posted by TPC
                          The key question in all this, the fundamental decider (no, not George W Bush) is whether the U.S. national interests or The Financial Powers That Be (TFPTB) power and monetary interests, are the final decider.
                          As someone who does NOT believe in the New World Order - merely in the scummy ponds by which the rich and powerful wallow in - the present situation seems to me more of a logical, if pathetic, consequence of years of hubris and regulatory capture than it seems the product of some ordered plan.

                          The only semi-adult discussions going on right now involve the US telling other nations to 'take one for the team', when in fact none of the other nations outside Japan seem willing to.

                          Comment


                          • #14
                            Re: Ah duh - the Federal Reserve will cut off the U.S. debt funding

                            Originally posted by c1ue
                            the present situation seems to me more of a logical, if pathetic, consequence of years of hubris and regulatory capture than it seems the product of some ordered plan.
                            Agreed - but who's hubris?

                            I am not claiming that TFPTB are operating under some arranged and ordered plan.

                            Like a tribe of lions hunting gazelles, they don't march to a single plan. They have their own internal competitions, conflicts and dissensions. But their habits are predictable, and they do habitually co-ordinate. They recognize one another, and normally attack others, not themselves. They obey the law of the jungle, or rather, in their view, everyone else obeys the laws of their jungle, for they are King of the Jungle (in their not so humble view.)
                            Most folks are good; a few aren't.

                            Comment


                            • #15
                              Re: Ah duh - the Federal Reserve will cut off the U.S. debt funding

                              Originally posted by TPC
                              Agreed - but who's hubris?

                              I am not claiming that TFPTB are operating under some arranged and ordered plan.

                              Like a tribe of lions hunting gazelles, they don't march to a single plan. They have their own internal competitions, conflicts and dissensions. But their habits are predictable, and they do habitually co-ordinate. They recognize one another, and normally attack others, not themselves. They obey the law of the jungle, or rather, in their view, everyone else obeys the laws of their jungle, for they are King of the Jungle (in their not so humble view.)
                              That may be.

                              From my own experiences at the upper levels of the corporate world, however, my formed view is that what we're seeing is more a result of protracted abuse of short term advantageous positions than any coherent behavior.

                              Numerous times I've seen CEOs and what not come in with fine backgrounds, but who were too afraid to take on the bureaucratic establishment and break it of the long term behaviors which were holding the overall company back. Between the large perks and the insulating layer of 'supporters' brought in, between the willful ignorance of what's happening on the ground both due to lack of experience doing so and arrogance in thinking, and ultimately with the realization that the gigantic packages given were sufficient to not have to succeed, that's how you wind up with GM (and its numerous corporate brethren).

                              There was no plan, merely the short sighted jostling of the biggest lemmings on the way to the cliff.

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