Monday, September 17, 2012

Yeah, it's like that.

Katie Rose is not the only wise person posting in "Turdville." I'd like to offer the following from a fellow who goes by the name of California Lawyer.

Yeah, It's Like That

By California Lawyer
As seen on tfmetalsreport.com
September 17, 2012

One of my favorite movies, Training Day, has that line. The scene is where Jake and Alonzo have their fight and confrontation at the end of the movie. In a split second, the power shifts. Alonzo asks the neighborhood leader, Bone: "It's like that, Bone?" Bone says "yeah, it's like that."

It is mesmerizing, and fantastically powerful, watching the power ebb from the once untouchable Alonzo, to the rookie cop and the neighborhood leader who announces to Jake "go on and bounce up out of here homie, we got your back." The now powerless Alonzo, realizes he just lost EVERYTHING, gets petulant, while the neighborhood citizens, realizing what just happened, walk away understanding that everything just changed.

We in turdville, are at that moment. Bernanke is Alonzo, doing the bidding of TPTB. Us turdites are like the neighborhood citizens, watching, realizing what just happened, with QE to infinity, MOPE, rumors of war, uprisings in the middle east, sabre rattling over Iran, drones, Hillary the warmonger, all of it. Who is Jake? Turd? Anyhow, that is how I see it. Now for the analysis.

Let's all operate from the same macro understanding.

(1) There is a system of global governance, banking, military, what not.

(2) That system is controlled, as opposed to being random.

(3) Those in charge of the system desire to keep the system in place, that is, to perpetuate the system, rather than see it collapse. This desire to perpetuate the system includes recognition of the ending of the current paradigm, to be replaced by another permutation of the system, allowing those in charge to remain in charge.

(4) As a result, those in charge, understand that there are but three methods to maintain system stability, that is, to keep the system from uncontrolled collapse, which collapse WILL occur from the accumulation of DEBT which cannot ever be repaid:

a-dilution of the existing fiat currency to prop up the system, that is, repaying debt by devaluing the currency and stealing from savers by inflation;

b-default on sovereign debt to prop up the system, that is, forgiveness of debt by creditors, or insolvency; or

c-war.

Choose one.

We are there now, clearly.

Fiat devaluation has been ongoing for years, and has grown exponential, including since 2008. There is a race to the bottom, says Jim Rickards, proven correct time and time again.

Default or forgiveness is not an option, since the entire system in intertwined by massive derivatives. That is, each unit of debt translates to trillions of derivatives, each of which to be viable requires that the underlying debt NOT default, or else the derivative explodes into worthlessness.

That leaves WAR.

Look backwards in time.

The great depression, societal collapse, and a changing paradigm, from agrarian to production in factories, cities. Collapse was ongoing, and FDR radically altered the landscape. When FDR's fixes proved unable to solve the problems, including confiscation and devaluing the currency, the only solution left was WAR. Debts were thus defaulted/forgiven/repaid in blood and treasure. The world changed.

Economic prosperity ensued, because the US was the world's economic engine. That paradigm lasted for a while, then it changed, of course.

Currently, we have a basic world structure:

(1) Producers of size with regard to goods, China, BRICs, rest of the third world;

(2) Consumers of size with regard to goods and energy, USA, Europe, Japan, China;

(3) Producers of size with regard to resources, Africa, China, Russia;

(4) Producers of size with regard to energy, OPEC, Russia, etc.

EACH needs the other in this global world. NONE individually can go it alone any more.

The producers of goods need resources, energy and consumers. If there is a fall off in ONE of the three, chaos ensues, and those in charge face revolution and death.

The consumers need cheap goods, cheap energy, and the means to consume; hence, fiat devaluation and credit, since labor prices have fallen off the cliff, the unproductive outnumber the productive, and those in charge use bread and circuses to control the masses by propaganda and distraction and MOPE. Without consumers, the producers collapse. The producers holding the fiat, face ruin, revolution, and societal upheaval, including death to those in charge.

Producers of energy need producers of goods and consumers, or else the energy produced falls in price due to collapsing demand. Revolution likely ensues, see Venezuela. Shifting alliances of political and tribal factions are on balance, insignificant, but are useful as distractions.

Putting it all together reveals:

(1) The USA is the consumer part of the puzzle. Those in charge will keep it this way, for now.

(2) China produces goods, and will keep it this way for now, with India the other third world countries with their cheap labor continuing to produce at rates the USA cannot match.

(3) Energy and resources continue to be the shifting targets, with each pillar of the system dependent upon cheap energy.

(4) In balance, all players mutually benefit the others. Out of balance, there is chaos.

(5) The US military is the enforcer. So long as the US military engages and keeps the order, the other countries will accept and hold our worthless fiat. If the USA reneges, then the fiat system collapses. If the holders of fiat try to dump them, the USA will not support those in charge, and revolutions and coups will result.

See, simple?

What then, when there is too much fiat sloshing all around? Food prices get too high, citizenry goes hungry, risk of revolution and death of leaders. Cannot have that, no sir.

So, the world needs a distraction, and a reset.

WAR IS COMING, as certain as I sit here and type this.

Please, please prepare...

Are you listening?

1 comment:

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