Posted on 12/24/2009 7:26:31 AM PST by FromLori
Do you believe everything the government tells you? Economist and statistician John Williams sure doesn't. Williams, who has consulted for individuals and Fortune 500 companies, now uncovers the truth behind the U.S. government's economic numbers on his Web site at ShadowStats.com. Williams says, over the last several decades, the feds have been infusing their data with optimistic biases to make the economy seem far rosier than it really is. His site reruns the numbers using the original methodology. What he found was not good.
Maymin: So we are technically bankrupt?
Williams: Yes, and when countries are in that state, what they usually do is rev up the printing presses and print the money they need to meet their obligations. And that creates inflation, hyperinflation, and makes the currency worthless.
Obama says America will go bankrupt if Congress doesn't pass the health care bill.
Well, it's going to go bankrupt if they do pass the health care bill, too, but at least he's thinking about it. He talks about it publicly, which is one thing prior administrations refused to do. Give him credit for that. But what he's setting up with this health care system will just accelerate the process.
Where are we right now?
In terms of the GDP, we are about halfway to depression level. If you look at retail sales, industrial production, we are already well into depressionary. If you look at things such as the housing industry, the new orders for durable goods we are in Great Depression territory. If we have hyperinflation, which I see coming not too far down the road, that would be so disruptive to our system that it would result in the cessation of many levels of normal economic commerce, and that would throw us into a great depression, and one worse than was seen in the 1930s.
What kind of hyperinflation are we talking about?
I am talking something like you saw with the Weimar Republic of the 1930s. There the currency became worthless enough that people used it actually as toilet paper or wallpaper. You could go to a fine restaurant and have an expensive dinner and order an expensive bottle of wine. The next morning that empty bottle of wine is worth more as scrap glass than it had been the night before filled with expensive wine.
We just saw an extreme example in Zimbabwe. ... Probably the most extreme hyperinflation that anyone has ever seen. At the same time, you still had a functioning, albeit troubled, Zimbabwe economy. How could that be? They had a workable backup system of a black market in U.S. dollars. We don't have a backup system of anything. Our system, with its heavy dependence on electronic currency, in a hyperinflation would not do well. It would probably cease to function very quickly. You could have disruptions in supply chains to food stores. The economy would devolve into something like a barter system until they came up with a replacement global currency.
What can we do to avoid hyperinflation? What if we just shut down the Fed or something like that?
We can't. The actions have already been taken to put us in it. It's beyond control. The government does put out financial statements usually in December using generally accepted accounting principles, where unfunded liabilities like Medicare and Social Security are included in the same way as corporations account for their employee pension liabilities. And in 2008, for example, the one-year deficit was $5.1 trillion dollars. And that's instead of the $450 billion, plus or minus, that was officially reported.
Wow.
These numbers are beyond containment. Even the 2008 numbers, you can take 100 percent of people's income and corporate profit and you'd still be in deficit. There's no way you can raise enough money in taxes.
What about spending?
If you eliminated all federal expenditures except for Medicare and Social Security, you'd still be in deficit. You have to slash Social Security and Medicare. But I don't see any political will to rein in the costs the way they have to be reined in. There's just no way it can be contained. The total federal debt and net present value of the unfunded liabilities right now totals about $75 trillion. That's five times the level of GDP.
What can we, the people, do to stop the government from, you know, taking all our money?
We should have acted 20 years ago. There's not much you can do at this point to prevent the eventual debasement of the dollar. This involves both sides of the political spectrum. It's not limited to the Republicans or the Democrats. They've both been very active in setting this up.
What can individuals do?
The only thing individuals can do now is look to protect themselves. I wish I could see a way, but shy of severe slashing of the social programs that is so politically reprehensible and would create such problems and social unrest, I don't see that as a practical solution.
If you're a young 20- or 25-year-old guy or gal, would you move to another country? What would you do?
We still have a great country. We're going through a period of economic pain. It's happened before. This is the kind of thing that's taken us decades to get into and it will take us decades to get out. Although the hyperinflation is going to be limited largely to the U.S., the economic downturn will affect things globally. I can't tell you how things will go with a hyperinflationary Great Depression, which is where I see things going.
It's the type of thing that will tend to lead to significant political change. People tend to vote their pocketbooks. You could have the rise of a third party. You could even have rioting in the streets. I'm not formally predicting that — anyone can run these different scenarios. For the individual, what you need to do, from an investment standpoint, look to preserve your wealth and assets. Don't worry about the day-to-day fluctuations in the markets. What I'm talking about here is over the long haul...
[Gold is] going to be highly volatile, as will the dollar, over the near term, but longer term, physical gold I would look at as a primary hedge for preserving the purchasing power of your wealth and assets. Maybe some physical silver. Get some assets outside the U.S. dollar. I might even look to move some assets physically outside the United States. The key here is to look at a longer range survival package, battening down the hatches, and preserving your wealth and assets during a very difficult time. Once you're through that, you'll have some extraordinary investment opportunities, and I can't tell you what it's going to be like on the other side of this crisis.
Wow. Gordon Brown is pure Hitler except with zero testosterone - even the clenched fist business.
What is really needed is not a New World Order, but a New World Storming of the Bastille.
That will not remove harmful protozoa. This will:
http://junglebucket.com/Jungle-Bucket-1.htm
Good for you. Blood was spilled for liberty. We need to honor that sacrifice and do all in our power to see it was not in vain.
Beer.
Agreed.
We can purge these shysters from our government. Jail those responsible for greed, corruption and traitorous acts against our nation.
Begin anew with monetary policy, bring back the gold standard.
RE-industrialize this nation, put Americans back to work producing first class products with true American innovation.
Kick illegal aliens out of this country. Stop paying for education, medication and incarceration of those who are not Americans.
Take the federal government back to it's constitutional roots and scope. Return the power back to the states.
This is a good start......any other suggestions y'all?
Wise words. I think people have a disconnect and do not realize that treaties like nafta really gave our people the shafta!
Not to mention those treaties erode our sovereignty and frankly they really destroyed our middle class.
Then after all that is the goal to infiltrate from within and take us down. Sick twisted thinking that we should be punished and brought under control like the rest of the third world crap holes!
thanks for that info...one more place I can scratch off the list.
That is what it will take but we will probably have to collapse completely first for people to get together and do that sadly.
Well, partially prepared. He doesn't have enough room to grow anything.
Is the doc from the area, and does he know something that you don’t about the public water supply?
It comes from the Tennessee river and the intake is downstream of three nuclear reactors, including Oak Ridge. The TN River has also had hundreds of thousands of tons of industrial waste, coal tar and other chemicals, poured into it for decades. I won't drink it. I have two wells on my farm down in the valley and I have them checked every year for heavy metals and other contaminants. I get my drinking water from those wells, but they are way, way better wells than any here on the plateau. The thing here on the plateau, especially in this area, is no one has good wells. They are full of sulfur and iron. Without treatment, the water coming out looks like it came out of mud puddle and it smells and tastes like rotten eggs. Rainwater harvesting would be a much better idea if survival is his motivation.
Jail those responsible for greed, corruption and traitorous acts against our nation.
I disagree here. Execution for treason during time of war.
Execution.
And don’t forget the ammo and reloading equipment - the need to fight off the zombies will rear it’s ugly head.
A doctor has skills to barter with.
Exactly. The Republicans are equally complicit in the mess we find ourselves in.....
Thx. We will probably never be able to fix the liberals. If they are dumb enough to think Cap and Trade is a good idea, they are probably lost causes. However, conservatives and the GOP do have the power to cease their own depredations upon the middle class. Libertarians, I put in the same category as the liberals, hopelessly clueless.
parsy, who is starting to get cold in Arkansas
Good. I have the food he will need.....
Conservative MUST understand that the government schools movement has ALWAYS been the Rosemary's Baby of the Utopian Progressives. It has been since they open the first compulsory government school in the mid-1800s.
THIS DID NOT START IN THE 1950s!!!! Utopian Progressives have ALWAYS been the leading directors of teacher education and curriculum.
Our nation's demise began when the FIRST child entered government schools in the mid-1800s!
Every day a child attends government schools he learns that government can take money from his neighbor to pay for a service his parents want for tuition FREE! They are taught every day that education is a right. Well?...If education is “right” then why not health care, food, clothing, or anything else the child wants for FREE!
Within one to three generations, my parents, grandparents, and great grandparents had approved:
** The direct election of Senators
** The feminist movement
** The Federal Reserve
** The failed League of Nations
** FDR and his New Deal
** Johnson's Great Society
** The abandonment of the gold standard
** A thousand other paper cuts of socialism
** And...Now we have Obama
If conservatives want to save this nation we MUST shut down the government schools and get children into PRIVATE CONSERVATIVE SCHOOLS!!
Yes, I am shouting. Conservatives are very stupid about the harm government schools have done and fail to realize that they can NOT be reformed! Government schools ARE A SOCIALIST PROGRAM. SOCIALISM CAN NOT BE REFORMED!!!!!
pinggggggggg
Solar h2o pumps work very well, and are affordable. You will need to construct a storage system for the pumped water. Sun and gravity work quite well for this application.
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