The Federal Reserve Plans To Identify “Key Bloggers” And Monitor Billions Of Conversations About The Fed On Facebook, Twitter, Forums And Blogs

The Federal Reserve wants to know what you are saying about it. In fact, the Federal Reserve has announced plans to identify "key bloggers" and to monitor "billions of conversations" about the Fed on Facebook, Twitter, forums and blogs. This is yet another sign that the alternative media is having a dramatic impact. As first reported on Zero Hedge, the Federal Reserve Bank of New York has issued a "Request for Proposal" to suppliers who may be interested in participating in the development of a "Sentiment Analysis And Social Media Monitoring Solution". In other words, the Federal Reserve wants to develop a highly sophisticated system that will gather everything that you and I say about the Federal Reserve on the Internet and that will analyze what our feelings about the Fed are. Obviously, any "positive" feelings about the Fed would not be a problem. What they really want to do is to gather information on everyone that views the Federal Reserve negatively. It is unclear how they plan to use this information once they have it, but considering how many alternative media sources have been shut down lately, this is obviously a very troubling sign.

You can read this "Request for Proposal" right here. Posted below are some of the key quotes from the document (in bold) with some of my own commentary in between the quotes....

"The intent is to establish a fair and equitable partnership with a market leader who will who gather data from various social media outlets and news sources and provide applicable reporting to FRBNY. This Request for Proposal ("RFP") was created in an effort to support FRBNY's Social Media Listening Platforms initiative."

A system like this is not cheap. Apparently the Federal Reserve Bank of New York believes that gathering all of this information is very important. In recent years, criticism of the Federal Reserve has become very intense, and most of this criticism has been coming from the Internet. It has gotten to the point where the Federal Reserve Bank of New York has decided that it had better listen to what is being said and find out who is saying it.

"Social media listening platforms are solutions that gather data from various social media outlets and news sources. They monitor billions of conversations and generate text analytics based on predefined criteria. They can also determine the sentiment of a speaker or writer with respect to some topic or document."

The Federal Reserve Bank of New York intends to listen in on "billions of conversations" and to actually determine the "sentiment" of those that are participating in those conversations.

Of course it will be those conversations that are "negative" about the Federal Reserve that will be setting off the alarm bells.

"Identify and reach out to key bloggers and influencers"

Uh oh. So they plan to "identify" key bloggers and influencers?

What exactly do they plan to do once they "identify" them?

"The solution must be able to gather data from the primary social media platforms –Facebook, Twitter, Blogs, Forums and YouTube."

Hopefully you understand this already, but nothing posted on the Internet is ever anonymous. Everything on the Internet is gathered by a vast host of organizations and is used for a wide variety of purposes. Data mining has become a billion dollar industry, and it is only going to keep growing.

You may think that you are "anonymous" when you criticize organizations like the Fed, but the truth is that if you are loud enough they will see it and they will make a record of it.

"The solution must provide real-time monitoring of relevant conversations. It should provide sentiment analysis (positive, negative or neutral) around key conversational topics."

Why do they need to perform "sentiment analysis"?

If someone is identified as being overly "negative" about the Fed, what will they do about it?

"The solution should provide an alerting mechanism that automatically sends out reports or notifications based a predefined trigger."

This sounds very much like the kind of "keyword" intelligence gathering systems that are currently in use by major governments around the globe.

Very, very creepy stuff.

Are you disturbed yet?

For those of us that write about the Federal Reserve a lot, this is very sobering news.

I wonder what the Fed will think about the following articles that I have posted on this site....

*Unelected, Unaccountable, Unrepentant: The Federal Reserve Is Using Your Money To Bail Out European Commercial Banks Once Again

*Celebrating Independence Yet Enslaved To Debt

*19 Reasons Why The Federal Reserve Is At The Heart Of Our Economic Problems

*Is Ben Bernanke A Liar, A Lunatic Or Is He Just Completely And Totally Incompetent?

*10 Things That Would Be Different If The Federal Reserve Had Never Been Created

What is their "Social Media Monitoring Solution" going to think about those articles?

Unfortunately, this is all part of a very disturbing trend.

Recently, a very creepy website known as "Attack Watch" was launched to gather information on those saying "negative" things about Barack Obama.

Suddenly, everyone seems obsessed with what you and I are saying.

This just shows how the power of the alternative media is growing.

Not only that, but it seems as though the government also wants to gather as much information on all of us as possible.

For example, a new rule is being proposed by the Department of Health and Human Services that would force health insurance companies to submit detailed health care information about all of their customers to the federal government.

Every single day our privacy is being stripped away a little bit more.

But now it is often not just enough for them to know what we are doing and saying. Instead, the "authorities" are increasingly stepping in to silence important voices.

One of the most recent examples of this was when Activistpost was taken down by Google. We are still awaiting word on why this was done.

Sadly, the silencing of Activistpost is far from an isolated incident.

Hordes of YouTube accounts have been shut down for their political viewpoints.

Quite a few very prominent alternative media websites have been censored or attacked because of what they stand for.

So why is this happening? Well, it turns out that the power of the alternative media is growing. According to a new survey by the Pew Research Center for The People & The Press, 43 percent of Americans say that they get their news on national and international issues from the Internet. Back in 1999, that figure was sitting at just 6 percent.

The American people are sick and tired of getting "canned news", and they are increasingly turning to the Internet in a search for the truth.

As I have written about previously, the mainstream media in this country is overwhelmingly dominated by just 6 very powerful corporations....

Today, ownership of the news media has been concentrated in the hands of just six incredibly powerful media corporations. These corporate behemoths control most of what we watch, hear and read every single day. They own television networks, cable channels, movie studios, newspapers, magazines, publishing houses, music labels and even many of our favorite websites. Sadly, most Americans don't even stop to think about who is feeding them the endless hours of news and entertainment that they constantly ingest. Most Americans don't really seem to care about who owns the media. But they should. The truth is that each of us is deeply influenced by the messages that are constantly being pounded into our heads by the mainstream media. The average American watches 153 hours of television a month. In fact, most Americans begin to feel physically uncomfortable if they go too long without watching or listening to something. Sadly, most Americans have become absolutely addicted to news and entertainment and the ownership of all that news and entertainment that we crave is being concentrated in fewer and fewer hands each year.

The "news" that we get from various mainstream sources seems to always be so similar. It is as if nearly all mainstream news organizations are reading from the same script. The American people know that they are not getting the whole truth and they have been increasingly looking to alternative sources.

The monopoly over the news that the mainstream media once possessed has been broken. The alternative media is now creating some huge problems for organizations that were once very closely protected by the mainstream media.

The American people are starting to wake up and they are starting to get very upset about a lot of the corruption that has been going on in our society.

But it turns out that the "authorities" don't like it too much when Americans try to actually exercise free speech in America today. For example, you can see recent video of female protesters in New York City being penned in by police and then brutally maced right here.

Are you sickened by that?

You should be.

What the "authorities" want is for us to shut up, sit in our homes and act as if nothing wrong is happening.

Meanwhile, they seem determined to watch us more closely than ever.

So are you going to be afraid to talk negatively about the Federal Reserve now that you know that they are going to be watching what you say on the Internet?

Bedbugs and Islam...

If you haven't seen this Brit before, you've missed an extraordinarily erudite speaker.
He is serious when he is funny and he is funny when he is serious. And, oh boy, is he on point! This is his latest, and I think the first of 2011. And he doesn't pull any punches, either! I wish every man and woman could see this! Please share it.

Is The U.S. Government Stockpiling Food In Anticipation Of A Major Economic Crisis?

Is the U.S. government stockpiling huge amounts of food and supplies in anticipation that something bad is about to happen? Is something about to cause a major economic crisis that will require large quantities of emergency food? For a while, I have been hearing things about the government storing food through the grapevine and I have not been sure what to think about those rumors. Well, today I received a phone call that blew me away. I debated for quite a while before I decided whether or not to share this information with you all. Normally I do not like to talk about anything unless I am able to prove it by pointing to an article in the mainstream media. But the source of the information that I am about to share with you is rock solid. I cannot reveal his name, so you will just have to trust me on that. Hopefully the following information will be one more "dot" as we all try to connect the dots about what is really going on out there.

This morning I received a call from a very prominent person in the storable food industry. He has asked me not to reveal his name. I have been dealing with him for an extended period of time and I consider him to be a rock-solid source. When I talked to him today, he had just received a huge order for storable food from a U.S. government source. He told me that the dollar amount of the order was in the "five figures".

When he asked about why so much food was being ordered, the government source told him essentially that "you know what is coming". When pushed further, the government official did not elaborate.

It was unclear whether this was part of a larger food stockpiling program by the government. Perhaps this order was just part of the normal preparations that government agencies make for potential emergencies.

Nobody could blame the government for storing up some emergency food. That is something that we all should be doing.

The truth is that the government is taking emergency preparedness very seriously these days. For example, you can see video of a high-level NASA official urging NASA employees to develop preparedness plans for their own families right here.

But what if this is a sign of something bigger?

Remember, this is not some rumor I just pulled off the Internet. This is not something that someone got from "an aunt" somewhere.

I got this information over the telephone from the person who took the order.

I promised that I would not reveal any more specific details, so I won't.

But this does seem to fit with a pattern that we are beginning to see emerge.

Earlier this year, FEMA issued an RFI (Request For Information) that inquired about the availability of 140 million meals of emergency food. Apparently the food was meant to be stored up in case there was a "catastrophic disaster event" along the New Madrid Fault.

You can view this FEMA RFI right here. The following is an excerpt....

The Federal Emergency Management Agency (FEMA) procures and stores pre-packaged commercial meals to support readiness capability for immediate distribution to disaster survivors routinely. The purpose of this Request for Information is to identify sources of supply for meals in support of disaster relief efforts based on a catastrophic disaster event within the New Madrid Fault System for a survivor population of 7M to be utilized for the sustainment of life during a 10-day period of operations. FEMA is considering the following specifications (14M meals per day):

- Serving Size - 12 ounce (entree not to exceed 480 calorie count);
- Maximum calories - 1200 and/or 1165 per meal;
- Protein parameters - 29g-37g kit;
- Trans Fat - 0;
- Saturated Fat - 13 grams (9 calories per gram);
- Total Fat - 47 grams (less than 10% calories);
- Maximum sodium - 800-930 mg;

Requested Menus to include snacks (i.e. fruit mix, candy, chocolate/peanut butter squeezers, drink mix, condiments, and utensils). All meals/kits must have 36 months of remaining shelf life upon delivery. Packaging should be environmentally friendly.

Mysteriously, seven days later this RFI was cancelled.

At that same time, FEMA also issued an RFI that sought to identify a supplier for 140 million blankets. You can view that RFI right here. The following is an excerpt....

The Federal Emergency Management Agency (FEMA) procures and stores blankets to support readiness capability for immediate distribution to disaster survivors routinely. The purpose of this Request for Information is to identify sources of supply for blankets in support of disaster relief efforts based on a catastrophic disaster event within the New Madrid Fault System for a survivor population of 7M to be utilized for the sustainment of life during a 10-day period of operations. FEMA is considering the following specifications (14M blankets per day):

- 100% cotton;
- White;
- 66" x 90"

Also, there have been some much publicized shortages of storable feed recently. There has been much speculation about whether or not the government is part of the reason for these shortages.

There are some products that simply were not available for an extended period of time. For example, the following was posted on the Mountain House home page....

As you know we have removed #10 cans from our website temporarily. The reason for this is sales of #10 cans have continued to increase. OFD is allocating as much production capacity as possible to this market segment, but we must maintain capacity for our other market segments as well.

The shortages around the country got so bad at one point earlier this year that a special alert was posted on Raiders News....

Look around you. Read the headlines. See the largest factories of food, potassium iodide, and other emergency product manufacturers literally closing their online stores and putting up signs like those on Mountain House's Official Website and Thyrosafe's Factory Webpage that explain, due to overwhelming demand, they are shutting down sales for the time being and hope to reopen someday.

Unfortunately, shortages have not been limited to storable food. Most Americans don't realize this, but there is a significant shortage of certain pharmaceutical drugs in many areas of the country right now. Just check out the video news report posted below....



In addition, it is not just in the United States where food is being aggressively stored up. For example, a recent article in The Telegraph noted that governments all over the globe are now stockpiling food....

Authoritarian governments across the world are aggressively stockpiling food as a buffer against soaring food costs which they fear may stoke popular discontent.

Also, some governments are now gobbling up as much farmland as they can.

According to the New York Times, China has been buying up "vast tracts of Latin America’s agricultural heartland" and is seeking to acquire quality farmland all over the globe.

So what does all of this mean?

It could mean something.

It could mean nothing.

But as I have written about so much recently, we really do seem to be on the verge of a major economic crisis.

The signs that the financial world is melting down are all around us. I won't take the time to repeat what I have covered in the last few days here. If you missed any of it, just go back and read these articles over....

*Is Financial Instability The New Normal?

*Depressed As A Nation? 80 Percent Of Americans Believe That We Are In A Recession Right Now

*Nervous Breakdown? 21 Signs That Something Big Is About To Happen In The Financial World

One thing that I haven't covered yet is a very curious move by Lloyd's of London. It turns out the Lloyd's of London has started pulling money out of banks in Europe’s peripheral economies according to Bloomberg....

Lloyd’s of London, concerned European governments may be unable to support lenders in a worsening debt crisis, has pulled deposits in some peripheral economies as the European Central Bank provided dollars to one euro-area institution.

At this point, world financial markets have officially entered "bear" territory. In fact, global stocks are down approximately 20 percent since May.

Many believe that what we have seen is just the beginning of another major financial crisis.

For example, in a recent editorial for The Ticker, Karl Denninger (who saw the 2008 crash coming) warned that the house of cards is starting to fall once again....

Well, America (and the world), you’ve been scammed by the financial institutions and governments for the last 30 years. 2008 was the first spasm of recognition but was short-circuited by…. you guessed it…. even more scams. Rather than demand truth and an end to the games the American consumer lapped up the frauds and schemes of the politicians on both sides of the aisle who conspired with the financiers to rip you off once again.

Later on in the editorial, Denninger stated that he hopes that all of us have "taken the last couple of years to become prepared"....

Now recognition of that fact is dawning on people in a convulsive fashion, and markets of all sorts are reacting as one would expect when their entire worldview is exposed as having been a gigantic and intentional pyramid scheme constructed of debt layered upon debt thatcannot be paid down. The wrong thing was done in 2008 and there is zero evidence that our government has changed one iota in their singular focus on misdirection and lies in this regard.

Welcome to awareness; I hope you’ve taken the last couple of years to become prepared.

Well, if the anecdotal evidence presented above is an indication of a larger trend, it appears that the government is getting prepared.

And if the government is stockpiling food, who can blame them?

It should be obvious to anyone that the world has become an incredibly unstable place.

Hopefully we are not about to enter another major economic crisis, but it never hurts to be prepared.

If anyone out there has any additional information that is relevant to this report, please let me know.

If the government really has started to aggressively stockpile food, that would be an important thing to know.

If it is happening, the mainstream media surely will not tell us about it. So we will have to rely on one another for information.

30 Signs That The U.S. Economy Is About To Go Into The Toilet!

If you think the U.S. economy is bad now, just wait for a few months. Things are about to become absolutely nightmarish. None of the long-term economic trends that are hollowing out our economy have been addressed and more bad economic news seems to come out virtually every single day. Now there is constant talk of the "next recession" in the mainstream media. But did the last recession ever truly end? The number of good jobs continues to decline, more stores are closing, incomes continue to go down, credit card debt and student loan debt are soaring, the housing market resembles a corpse, the number of Americans living in poverty continues to rise and government debt is at unprecedented levels. We are losing blood fast, and almost all of our leaders are either too corrupt or too incompetent to be able to do anything about it. The U.S. economy really and truly is about to go into the toilet, and if something is not done very quickly we are going to experience a complete and total economic disaster in this nation.

Americans have been promised over and over that this economic downturn is just "temporary" and that things will return to normal soon. During this upcoming election cycle, the Democrats will swear that they have all the answers and that if we just elect them everything will be okay. The Republicans will also swear that they have all the answers and that if we just elect them everything will be okay.

Well, both sides are lying. The economic plans of both major political parties are a joke. Neither of them can restore economic prosperity to this nation.

Our politicians could delay the coming economic collapse by borrowing gigantic piles of money and pumping all of that cash into the economy. But stealing from our children and our grandchildren is not exactly sound economic policy.

Yes, the U.S. economy is in bad shape right now, but things are about to get even worse. The long-term problems that are destroying our economy have not been fixed, and the leaks in our ship are going to continue to grow.

The following are 30 signs that the U.S. economy is about to go into the toilet....

#1 An increasing number of unemployed Americans have become so desperate that they have started to look for work overseas. For example, the number of Americans that are submitting applications for temporary work visas in Canada has approximately doubled since 2008. Other Americans are willing to learn foreign languages and travel to the other side of the world if that is what it takes to land a decent job. Just consider the following quote from a recent USA Today report....

Job placement firms are reporting a surge in American worker interest in booming economies such as Hong Kong, Singapore, China and, increasingly, India. Hunt Partners, an executive search firm, estimates that it's getting 50% to 100% more unsolicited résumés from Americans looking for Asia-based positions today than before the recession.

#2 When Barack Obama first took office, the official U.S. unemployment rate was 7.6 percent. Today it is 9.1 percent.

#3 The number of Americans that are concerned that they will lose their jobs continues to hover near record highs. According to Gallup, 30 percent of all employed Americans are worried that they will soon be laid off.

#4 After three straight years of very high unemployment, you can feel frustration and desperation in the air almost everywhere that you go. Many unemployed Americans are now at the end of their ropes. The following is from a testimonial that was recently posted on The Atlantic....

The most difficult part of the job search is:

1. that I don't live near a factory or outsource outlet in China, India, or Malaysia.

2. trying not to appear desperate for a job when I am, in fact, quite desperate for a job.

3. that I am subject to everyone's advice on how to get a job, but no real job leads.

4. that I am reminded that having a good job is not an entitlement.

5. that when I become depressed from my job search, I'm told told to cheer up or else give a bad vibe to prospective employers ... yet when I become happy through non-search related activities, I am reminded that I should be looking for work

7. that when I confide to friends and family that I have "given up" to pursue more fruitful interests, it elicits a crushing look of disbelief, disappointment, and disgust

8. waiting for permission to give up.

#5 The percentage of American men that are employed continues to plummet. In July, only 63.5 percent of all men in the United States had a job. Since 1948, that number has only been lower one time (63.3 percent in December 2009).

#6 Back in the 1950s, manufacturing accounted for about 28 percent of U.S. GDP. Last year, it accounted for just 11.7 percent. Meanwhile, manufacturing now accounts for about 25 percent of GDP in China and they now actually have more factory production each year than we do. Sadly, Barack Obama is pushing for even more trade agreements that will send millions more of our jobs overseas.

#7 The percentage of Americans that are working low paying jobs continues to relentlessly march upwards. Back in 1980, less than 30% of all jobs in the United States were low income jobs. Today, more than 40% of all jobs in the United States are low income jobs.

#8 According to John Williams of shadowstats.com, after you add in all short-term discouraged workers, all long-term discouraged workers and all Americans that are working part-time because they cannot find full-time employment, the real unemployment rate should be approximately 23 percent.

#9 We are starting to see another huge wave of store closings and layoffs. For example, the parent company of Payless stores has announced that it will be permanently closing 475 stores. Borders is in the process of closing every single one of its 399 stores. Also, Bank of America has just announced that it will be closing about 600 branches, and that could result in the loss of about 30,000 good jobs.

#10 Median household income has fallen for three years in a row.

#11 Americans are really starting to rack up consumer debt once again. According to Time Magazine, U.S. consumers are on pace to collectively add 54 billion dollars in credit card debt in 2011.

#12 Student loan defaults are rising very sharply. Just consider the following excerpt from a recent New York Times article....

The share of federal student loan defaults rose sharply last year, especially at for-profit colleges and universities, where 15 percent of borrowers defaulted in the first two years of repayment, up from 11.6 percent the previous year.

#13 According to a chart in The Economist, whenever the number of newspaper articles in the Financial Times and the Wall Street Journal that mention the word "recession" goes over 1,500 in a particular quarter, the U.S. economy almost always goes into a recession.

#14 The U.S. housing crash just continues to get worse. The index of home builder sentiment put out by the National Association of Home Builders fell once again during the month of September. With such a glut of unsold foreclosed homes on the market, it is making things really hard of home builders. Things have gotten so bad that even the U.S. government now owns nearly a quarter of a million foreclosed homes. The impact of this housing nightmare on families has been absolutely devastating. Just check out what a recent Time Magazine article had to say about what has been going on in California....

The impact on children has been brutal: since 2007, 7% of the state's children have had a foreclosure process started on their homes, the fourth-highest level in the nation, according to a study released this month by the Annie E. Casey Foundation.

#15 Many believe that due to much tighter lending standards, it is now harder to be approved for a mortgage than at any other time since World War II. This is absolutely crushing the housing market.

#16 Most Americans don't seem to expect housing prices to recover for an extended period of time. One recent survey found that 54 percent of Americans believe that there will not be a housing recovery until "2014 or later".

#17 The combined debt of the largest GSEs (Fannie Mae, Freddie Mac and Sallie Mae) has increased from 3.2 trillion in 2008 to a whopping 6.4 trillion in 2011. If that debt goes bad, U.S. taxpayers will be left holding the bill.

#18 There are now nearly 50 million Americans that do not have health insurance, and the percentage of Americans covered by employer-based health plans has fallen for 11 years in a row. Meanwhile, Americans now spend about 3 times as much on health care as they did back in 1990.

#19 The Postal Service has publicly announced that it is "on the verge" of financial collapse.

#20 The number of small businesses continues to fall. I recently noted this fact on The American Dream Blog....

The number of "self-employed" Americans continues to rapidly shrink. According the Bureau of Labor Statistics, 16.6 million Americans were self-employed back in December 2006. Today, that number has shrunk to 14.5 million. Even though we have 14 million unemployed people in this country and jobs are incredibly difficult to come by, the number of people trying to work for themselves continues to decrease because the environment for small businesses in this country has become so incredibly toxic.

#21 American consumers have become tremendously pessimistic. According to one recent survey, 61 percent of all Americans believe that they will not return to their "pre-recession" lifestyles until at least 2014. According to a different recent survey, 39 percent of Americans actually believe that the U.S. economy has now entered a "permanent decline".

#22 Many U.S. investors certainly seem to believe that trouble is coming. According to CNN, last month the number of bets against the S&P 500 was the highest that we have seen in about a year.

#23 The number of U.S. households that are "doubling up" continues to grow. According to the U.S. Census Bureau, the number of combined households has increased by 10.7 percent since 2007.

#24 When Barack Obama moved into the White House, the average price of a gallon of gasoline in the United States was $1.83. Today it is $3.58.

#25 The number of Americans living in poverty grew by 2.6 million last year. That was the largest increase since the U.S. government began calculating poverty figures back in 1959.

#26 Back in the year 2000, 11.3% of all Americans were living in poverty. Today, 15.1% of all Americans are living in poverty.

#27 On Barack Obama's first day on the job, there were about 32 million Americans on food stamps. Today, there are more than 45 million Americans on food stamps.

#28 If there is a financial collapse in Europe, that will definitely plunge us into another recession. Right now, things do not look promising. At this point, headlines all over the world are proclaiming that Greece is dangerously close to defaulting.

#29 At some point soon, investors all over the globe may decide that it is time to start dumping U.S. government debt. For example, Chinese officials are now openly talking about the need to "liquidate" their holdings of U.S. Treasuries.

#30 The U.S. national debt continues to explode in size and spiral out of control. According to Professor Laurence J. Kotlikoff, the U.S. "fiscal gap" increased by about 6 trillion dollars last year. In fact, Kotlikoff makes a compelling argument that Greece is actually in better shape financially than the United States is.

Do you now understand how much trouble we are in?

The long-term trends that are destroying us continue to get worse.

The United States is steamrolling directly toward an economic collapse.

When this economy hits bottom and splatters all over the place, it is not going to be easy to fix.

The America that we know today is going to be wiped out by a gigantic mountain of debt and by the consequences of decades of really bad decisions.

We were handed the keys to the greatest economic machine in the history of the world and we have wrecked it.

So prepare for really, really hard times ahead.

The era of endless prosperity is ending.

Next comes the pain.

Moody’s downgrades three US banks!

Moody’s downgraded the credit ratings of Bank of America, Citigroup and Wells Fargo, three of the biggest US banks, over concerns that the US government would be less likely to rescue the lenders if they faced failure.
“Moody’s believes that the government is likely to continue to provide some level of support to systemically important financial institutions. However, it is also more likely now than during the financial crisis to allow a large bank to fail should it become financially troubled, as the risks of contagion become less acute,” the ratings agency wrote on Wednesday.
Bank of America, the largest US bank by assets, had its long-term senior debt cut from A2 to Baa1 and its short-term debt cut from Prime 1 to Prime 2. The downgrades “do not reflect a weakening of the intrinsic credit quality” of the bank, Moody’s said, but warned that the bank continued to face risks from its mortgage holdings.
The short-term rating of Citigroup, the third-biggest US bank, was also cut from Prime 1 to Prime 2, but its long-term rating was held at A3. Moody’s said the downgrade was “not a reflection of Citigroup’s liquidity profile, which strengthened significantly in the past two years and is robust.”
Senior debt at Wells Fargo, the largest US mortgage lender, was downgraded from A1 to A2, but Moody’s affirmed its Prime 1 rating on the bank’s short-term debt.
On Wednesday afternoon in New York trading, BofA’s shares fell 3.3 per cent to $6.68 and Citi’s stock was down 0.1 per cent at $26.90, while Wells Fargo shares shook off an initial fall following the announcement and were up 0.7 per cent to $24.84.
The ratings agency said the outlook on all three banks’ senior ratings remains negative, suggesting that further downgrades were possible. The move followed notice that the banks were placed under review in June.
The negative outlook “reflects the possibility it may further reduce its systemic support assumptions in the future as a consequence of the process set in motion by the enactment of the Dodd-Frank Act”, Moody’s said. “The orderly liquidation authority included in Dodd-Frank demonstrates a clear intent to impose losses on bondholders in the event that a systemically important bank ... was nearing failure.”
Moody’s said that because measures to reduce systemic risk, including resolution plans and reforms to the over-the-counter derivatives market, were still pending, it believed it would be “very difficult” for the US government to wind down a failing bank “without a disruption of the marketplace and the broader economy”.

25 Signs That A Horrific Global Water Crisis Is Coming!

Every single day, we are getting closer to a horrific global water crisis. This world was blessed with an awesome amount of fresh water, but because of our foolishness it is rapidly disappearing. Rivers, lakes and major underground aquifers all over the globe are drying up, and many of the fresh water sources that we still have available are so incredibly polluted that we simply cannot use them anymore. Without fresh water, we simply cannot function. Just imagine what would happen if the water got cut off in your house and you were not able to go out and buy any. Just think about it. How long would you be able to last? Well, as sources of fresh water all over the globe dry up, we are seeing drought conditions spread. We are starting to see massive "dust storms" in areas where we have never seem them before. Every single year, most of the major deserts around the world are getting bigger and the amount of usable agricultural land in most areas is becoming smaller. Whether you are aware of this or not, the truth is that we are rapidly approaching a breaking point.

If dramatic changes are not made soon, in the years ahead water shortages are going to force large groups of people to move to new areas. As the global water crisis intensifies, there will be political conflicts and potentially even wars over water. We like to think of ourselves as being so "advanced", but the reality is that we have not figured out how to live without water. When the water dries up in an area, most of the people are going to have to leave.

And yes, it will even happen in the United States too. For example, once Lake Mead dries up there is simply no way that so many people are going to be able to live in and around Las Vegas.

Right now, most of us take for granted that we will always have access to an unlimited amount of clean water.

But when you take a hard look at the data, it quickly becomes clear that everything that we have always taken for granted about water is about to dramatically change.

That following are 25 signs that a horrific global water crisis is coming. The first 12 facts are about the United States, and the last 13 are about the rest of the world....

#1 Today, the United States uses approximately 148 trillion gallons of fresh water a year.

#2 According to the U.S. government, 36 U.S. states are already facing water shortages or will be facing water shortages within the next few years.

#3 Since 1998, the level of water in Lake Mead has plunged by more than 50 percent. Lake Mead supplies about 85 percent of the water used in Las Vegas, and at this point the lake has 5.6 trillion gallons less water than it used to have. Lake Mead is falling so fast that some believe that the Hoover dam could actually stop producing electricity in a few years. Needless to say, that would be a total disaster for that entire region of the country. In addition, if things continue at the current pace, it is being estimated that Lake Mead will run completely dry some time around the year 2021.

#4 According to the U.S. National Academy of Sciences, the U.S. interior west is now the driest that it has been in 500 years.

#5 The Ogallala Aquifer, which is a massive underground lake that stretches from South Dakota all the way to Texas, is rapidly drying up. The Ogallala Aquifer is believed to be the largest body of fresh water in the world, and right now it is being drained at a rate of approximately 800 gallons per minute. Right now it covers approximately 174,000 square miles, and since the 1950s we have drained enough water from it "to half-fill Lake Erie". Once upon a time, the Ogallala Aquifer had an average depth of about 240 feet, but today the average depth is just 80 feet. If something is not done, we will definitely see a return of the Dust Bowl days of the 1930s. We need to start listening to the experts. Just consider what David Brauer of the Ogallala Research Service had to say when asked about the future of the Ogallala Aquifer....

"Our goal now is to engineer a soft landing. That's all we can do."

#6 A federal judge has ruled that the state of Georgia has very few legal rights to Lake Lanier. Lake Lanier is the main water source for the city of Atlanta. Millions more people are expected to move into the Atlanta area in the coming years, and this is creating an absolute nightmare for city officials.

#7 It is estimated that California only has a 20 year supply of fresh water left.

#8 It is estimated that New Mexico only has a 10 year supply of fresh water left.

#9 Things have gotten so dry in Arizona that now giant "dust storms" have been blowing through the city of Phoenix.

#10 Texas is has experienced one of the driest stretches that it has ever seen. Right now, approximately 81 percent of the state of Texas is experiencing "exceptional drought" conditions, and wildfires have burned an astounding 3.6 million acres in the state.

#11 Approximately 40 percent of all U.S. rivers and approximately 46 percent of all U.S. lakes have become so polluted that they are are now considered to be too dangerous to fish in, swim in or get drinking water from.

#12 Eight states in the Great Lakes region have signed a pact banning the export of water to outsiders - even to other U.S. states.

#13 It is being projected that by the year 2030, global demand for water will be 40 percent higher than it is today.

#14 Worldwide demand for fresh water tripled during the last century, and is now doubling every 21 years.

#15 According to USAID, one-third of the population of the earth will be facing severe or chronic water shortages by the year 2025.

#16 Of the 60 million people added to the world’s cities every year, the vast majority of them live in impoverished areas that have no sanitation facilities whatsoever.

#17 It is estimated that 75 percent of the surface water in India is now contaminated by human and agricultural waste.

#18 If you can believe it, according to a UN study on sanitation, far more people in India have access to a cell phone than to a toilet.

#19 In the developing world, 90 percent of all wastewater is discharged completely untreated into local rivers, streams or lakes.

#20 Every 8 seconds, somewhere in the world a child dies from drinking dirty water.

#21 Due to a lack of water, Saudi Arabia has given up on trying to grow wheat and will be 100 percent dependent on wheat imports by the year 2016.

#22 In northern China, the water table is dropping one meter every single year because of drought and overpumping.

#23 Incredibly, a new desert the size of Rhode Island is created in China every single year because of drought and overpumping.

#24 In China, 80 percent of all major rivers have become so horribly polluted that they do not support any aquatic life at all at this point.

#25 Collectively, the women of South Africa walk the equivalent of the distance to the moon and back 16 times a day just to get water.

To learn more about the coming global water crisis, check out the short video posted below....

Right now, more than a billion people around the globe do not have access to safe drinking water.

That number is going to keep increasing.

Without enough fresh water, people cannot grow enough food. Global food prices are already starting to skyrocket, and the coming global water crisis certainly is not going to help matters.

A massive, massive disaster is on the horizon. The era of gigantic amounts of cheap food and "unlimited" amounts of clean water is over.

A horrific global water crisis is coming.

You better get ready.

Unelected, Unaccountable, Unrepentant: The Federal Reserve Is Using Your Money To Bail Out European Commercial Banks Once Again

For a moment, imagine that there is a privately-owned organization in the United States that can create U.S. dollars out of thin air whenever it wants and can loan that money to whoever it wants to. Imagine that this organization is able to act with the full power of the U.S. government behind it, but that nobody in the organization is ever elected by the American people, and that for all practical purposes the organization is not accountable to the president or to Congress. Imagine that the organization is able to make trillions of dollars of secret loans to banks, to foreign governments and even to their close friends without ever having to face a comprehensive audit. Does that sound preposterous? Well, such an organization actually exists. It is called the Federal Reserve, and today we found out that once again the Fed is going to be taking huge piles of your money and loaning it to commercial banks in Europe. The Congress cannot overrule this decision. Neither can Barack Obama. Because it has so much power, many refer to the Federal Reserve as "the fourth branch of government", but unlike the other three branches of government, there are basically no significant "checks and balances" on the Federal Reserve. If you don't like the fact that the Federal Reserve is racing in to help big foreign banks survive the European debt crisis that is just too bad. The Federal Reserve pretty much gets to do whatever it wants to do, and the folks over at the Fed simply do not care whether you like that or not.

So what in the world just happened today? The following is how an article on CNBC explained it....

Just ahead of the Wall Street open Thursday, the European Central Bank, along with the U.S. Federal Reserve, Bank of England, Bank of Japan and Swiss National Bank announced they would offer three-month dollar loans to Europe's commercial banks, easing dollar funding constraints.

It must be nice to do whatever you want without having to get the approval of anyone else.

What do you think Barack Obama would give for such power right about now?

The Federal Reserve and other major central banks around the world decided that lending big European banks gigantic piles of dollars would be a good idea, so they are just doing it.

No debate, no votes and no democracy - they just tell us how things are going to be and that is that.

It is a bit ironic that all of this happened on the third anniversary of the collapse of Lehman Brothers. It is almost as if the central bankers of the world are trying to send some sort of a message.

So how much money is going to be loaned out?

Well, according to an article in The Daily Mail, big European banks are going to be able to borrow an "unlimited" amount of money....

The deal announced yesterday means banks will be able to borrow ‘any amount’ of money in three separate auctions in October, November and December. Banks will have to put up collateral, or security, to tap the emergency funds.

Wow - I wish someone would offer to lend me an "unlimited" amount of money.

But of course this really is not going to solve anything in the long run. You can't solve a raging debt problem with more debt.

Yes, it will help the big European banks with their short-term liquidity problems, but it will do nothing to fix the long-term structural problems that are tearing Europe to pieces.

Win Thin, a senior currency strategist at Brown Brothers Harriman, said essentially the same thing to CNBC today....

"They're taking care of the symptoms, but the underlying illness is still out there. On the margin, it's positive. Until Greece defaults and we clear this whole thing up, they're still treading water"

So, no, the financial problems of Europe have not been solved.

Just think of this latest move as a temporary band-aid.

So why get upset about it?

Well, what all of this shows is just how arrogant the Federal Reserve is.

The Federal Reserve gets to throw around trillions of dollars without any accountability to the American people.

As I have written about previously, the Federal Reserve made $16.1 trillion in secret loans to their friends during the last financial crisis.

This was revealed in a GAO report, and members of Congress such as Ron Paul and Bernie Sanders tried to get people to pay attention to this. The following is a statement about this report that was taken from the official website of Senator Sanders....

"As a result of this audit, we now know that the Federal Reserve provided more than $16 trillion in total financial assistance to some of the largest financial institutions and corporations in the United States and throughout the world"

So how much of that money went overseas? Well, it turns out that approximately $3.08 trillion of that money was loaned to big banks and major financial institutions in Europe and Asia.

Barack Obama can't lend trillions of dollars to foreign banks.

So why does the Federal Reserve get to do it?

Sadly, most Americans know very little about the Federal Reserve. In the United States today, most Americans graduate from high school without ever learning much of anything about the Fed.

But if you really want to understand what is going on with our economy, it is absolutely critical that you understand the Federal Reserve.

The following are some more reasons why you should be upset about what the Federal Reserve has been doing....

*The Federal Reserve is a perpetual debt machine. Today, the U.S. national debt is 4700 times larger than it was when the Federal Reserve was created back in 1913.

*The Federal Reserve has recently been actually paying banks not to make loans. Right now banks can park money at the Federal Reserve and make risk-free income without having to make loans to the American people.

*Current Federal Reserve Chairman Ben Bernanke has a track record of failure that is legendary, and yet George W. Bush and Barack Obama both backed him 100%.

*The Federal Reserve system is designed to create inflation. The truth is that the United States has only had a persistent, ongoing problem with inflation since the Federal Reserve was created back in 1913.

*Since 2008, what the Federal Reserve has been doing to our money supply has been absolutely insane. Eventually this is going to have very serious consequences for us.

*The U.S. government has handed over the task of "centrally planning" our economy to the Federal Reserve. The Fed decides what the target rate of inflation should be, what the target rate of unemployment should be, what interest rates are going to be and what the size of the money supply is going to be. This is quite similar to the "central planning" that goes on in communist nations, but very few people in our government seem upset by this.

*The Federal Reserve picks "winners" and "losers" in the financial system. For example, when the last financial crisis hit, the Fed bent over backwards to help out the big Wall Street banks, but hordes of small banks were left out in the cold.

*As mentioned above, the Federal Reserve has become way, way too powerful. The Fed is able to do a lot of things that the three branches of government are simply not able to do. Fortunately, there are a few of our leaders that are alarmed by this. For example, Ron Paul once told MSNBC that he believes that the Federal Reserve is now more powerful than Congress.....

"The regulations should be on the Federal Reserve. We should have transparency of the Federal Reserve. They can create trillions of dollars to bail out their friends, and we don’t even have any transparency of this. They’re more powerful than the Congress."

As long as we continue to use a debt-based currency that is controlled by a privately-owned central bank, we are going to continue to have permanent inflation and government debt that expands at an exponential pace.

The "central planning" done by the Federal Reserve has created bubble after bubble after bubble. Our dollars is on the verge of dying and our financial system is about to collapse.

The Federal Reserve system simply does not work.

Hopefully we can start sending more politicians to Washington D.C. that will be willing to stand up to the Federal Reserve.

But for now, the Federal Reserve is going to keep running around doing whatever it wants to do whether we like it or not.

KUHNER: How the media are dividing Republicans...Debates provoke Republican hopefuls’ conflicts with each other rather than with Obama

The liberal media are President Obama’s last hope. His popularity is plummeting. The economy is in crisis. Global recovery has stalled. The Middle East is drifting toward chaos. Even many Democrats concede that Mr. Obama’s re-election is in serious jeopardy. Hence, he has only one chance left: Provoke the GOP presidential candidates to tear each other apart.

And that is exactly what they are doing. The administration and its Democratic media allies have laid a trap - and the Republican nominees are rushing headlong into it. This started with the Sept. 7 debate hosted by NBC and Politico, which focused on the supposed differences on Social Security between Texas Gov. Rick Perry and former Massachusetts Gov. Mitt Romney.

In reality, both men rightly understand that the entitlement program is going broke. Unless it is profoundly reformed, the pension system is financially unsustainable. The demographics - the shrinking ratio of workers who pay into the system and the coming wave of baby-boomer retirees who are scheduled to receive benefits - cannot be altered. The choice is clear: Either the program is revamped or it collapses.

The establishment media, however, are obsessed with Mr. Perry having characterized the program as a “Ponzi scheme.” Mr. Perry’s only “mistake” was he said something that Washington potentates consider controversial: the truth. Social Security is a form of inter-generational theft. Today’s average beneficiary gets much more than he puts in, leaving future generations to pay the mounting tab. If a private business ran its finances the same way, the owners would rightly be sent to prison. It has been a massive fraud perpetrated upon the American people.

Yet Social Security is the crown jewel of the New Deal. For liberals, it is the political Holy Grail. This is why they despise Mr. Perry. His call for the program to be partially privatized and devolved to the states strikes at the heart of welfare liberalism. Democrats have become ideological reactionaries, resisting any attempts to modernize entitlement programs through market-based reforms. They are now smearing Mr. Perry as someone who hates seniors and wants to take away their pension checks. This is a lie. His proposals would not only save and improve Social Security, but are intended only for those under the age of 55. In other words, it will have no impact - zilch, zero, none - on current or soon-to-be retirees.

Many Republicans, however, are taking their cue from the liberal press corps. They are denouncing Mr. Perry for his “language” and “poor choice of words.” Mr. Romney is now running ads that could have been produced by the Democratic National Committee, hoping to scare seniors over Mr. Perry’s ideas. The two GOP front-runners should be waging a frontal assault upon Mr. Obama’s dismal record and showcasing to voters their positions on Social Security, health care reform (besides simply repealing Obamacare), slashing the debt and fostering economic recovery. Instead, they are attacking - and undermining - each other. Mr. Obama must be laughing in the White House.

Monday’s CNN debate was another case in point. Moderator Wolf Blitzer, consistently asked questions that aimed to create fissures among the candidates on Social Security, illegal immigration and Mr. Perry’s 2007 decision to vaccinate Texas schoolgirls against human papillomavirus (HPV) - a common sexually transmitted disease that can lead to cervical cancer. Rep. Michele Bachmann of Minnesota excoriated him for mandating the HPV vaccination. She also went a step further, accusing Mr. Perry of corruption. She charged that his former top aide, Mike Toomey, a chief lobbyist at Merck & Co., the pharmaceutical giant that produces the Gardasil vaccine, received special favors in return for lucrative campaign donations.

Mr. Perry’s executive order was wrong. It violated family autonomy and personal responsibility. Mr. Perry has admitted it was a mistake, he has apologized for it and the order was eventually overturned by the Texas legislature. The HPV vaccination was not Watergate. Mrs. Bachmann, however, refuses to back away from her accusations of influence-peddling. Even Sarah Palin is jumping on the bandwagon, decrying Mr. Perry’s “crony capitalism.” This may be true. But so far, there is one problem: evidence - or rather the lack of it. Making a charge is not the same thing as proving it.

The result is that the GOP is slowly descending into a civil war. Candidates are now turning their guns on one another instead of attacking the real enemy: Mr. Obama. What is remarkable about the recent debates is how little the moderators asked about America’s swift decline during the past three years. The record deficits, the historic credit downgrade, high unemployment, creeping inflation, economic sclerosis, soaring poverty rates, more than 45 million Americans on food stamps, the pervasive opposition to Obamacare, the abandonment of Israel, Iran’s impending acquisition of a nuclear bomb, the rise of radical Islam in Egypt and Libya - all of this is a direct result of Mr. Obama’s transnational hard-left policies. Yet hardly a question has been asked about any of these issues. Like in 2008, the liberal media is trying to prop him up.

Primaries are supposed to be combative - a chance for voters to assess where candidates stand on the issues and to evaluate their records. Debating policy is one thing, mud-slinging and demagoguery is quite another - especially when the incumbent president is systematically dismantling America. Almost any of the Republican challengers - Mr. Perry, Mr. Romney, Mrs. Bachmann, Newt Gingrich, Rep. Ron Paul, Herman Cain - would be infinitely better than Mr. Obama. And any of them could probably beat him in 2012 - unless, they so badly bleed each other that the eventual nominee is too weak and tarnished to win. This is what the establishment media is counting on.

Jeffrey T. Kuhner is a columnist at The Washington Times and president of the Edmund Burke Institute.

Income Slides to 1996 Levels. Thank Obama.

The income of the typical American family—long the envy of much of the world—has dropped for the third year in a row and is now roughly where it was in 1996 when adjusted for inflation.

The income of a household considered to be at the statistical middle fell 2.3% to an inflation-adjusted $49,445 in 2010, which is 7.1% below its 1999 peak, the Census Bureau said. READ THE STORY CLICK HERE....

20 Signs Of Imminent Financial Collapse In Europe

Are we on the verge of a massive financial collapse in Europe? Rumors of an imminent default by Greece are flying around all over the place and Greek government officials are openly admitting that they are running out of money. Without more bailout funds it is absolutely certain that Greece will soon default on their debts. But German officials are threatening to hold up more bailout payments until the Greeks "do what they agreed to do". The attitude in Germany is that the Greeks must now pay the price for going into so much debt. Officials in the Greek government are becoming frustrated because the more austerity measures they implement, the more their economy shrinks. As the economy shrinks, so do tax payments and the budget deficit gets even larger. Meanwhile, hordes of very angry Greek citizens are violently protesting in the streets. If Germany allows Greece to default, that is going to start financial dominoes tumbling around the globe and it is going to be a signal to the financial markets that there is a very real possibility that Portugal, Italy and Spain will be allowed to default as well. Needless to say, all hell would break loose at that point.

So why is Greece so important?

Well, there are two reasons why Greece is so important.

Number one, major banks all over Europe are heavily invested in Greek debt. Since many of those banks are also very highly leveraged, if they are forced to take huge losses on Greek debt it could wipe many of them out.

Secondly, if Greece defaults, it tells the markets that Portugal, Italy and Spain would likely not be rescued either. It would suddenly become much, much more expensive for those countries to borrow money, which would make their already huge debt problems far worse.

If Italy or Spain were to go down, it would wipe out major banks all over the globe.

Recently, Paul Krugman of the New York Times summarized the scale of the problem the world financial system is now facing....

Financial turmoil in Europe is no longer a problem of small, peripheral economies like Greece. What’s under way right now is a full-scale market run on the much larger economies of Spain and Italy. At this point countries in crisis account for about a third of the euro area’s G.D.P., so the common European currency itself is under existential threat.

Most Americans don't spend a lot of time thinking about the financial condition of Europe.

But they should.

Right now, the U.S. economy is really struggling to stay out of another recession. If Europe has a financial meltdown, there is no way that the United States is going to be able to avoid another huge economic downturn.

If you think that things are bad now, just wait. After the next major financial crisis what we are going through right now is going to look like a Sunday picnic.

The following are 20 signs of imminent financial collapse in Europe....

#1 The yield on 2 year Greek bonds is now over 60 percent. The yield on 1 year Greek bonds is now over 110 percent. Basically, world financial markets now fully expect that Greece will default.

#2 European bank stocks are getting absolutely killed once again today. We have seen this happen time after time in the last few weeks. What we are now witnessing is a clear trend. Just like back in 2008, major banking stocks are leading the way down the financial toilet.

#3 The German government is now making preparations to bail out major German banks when Greece defaults. Reportedly, the German government is telling banks and financial institutions to be prepared for a 50 percent "haircut" on Greek debt obligations.

#4 With thousands upon thousands of angry citizens protesting in the streets, the Greek government seems hesitant to fully implement the austerity measures that are being required of them. But if Greece does not do what they are being told to do, Germany may withhold further aid. German Finance Minister Wolfgang Schaeuble says that Greece is now "on a knife’s edge".

#5 Germany is increasingly taking a hard line with Greece, and the Greeks are feeling very pushed around by the Germans at this point. Ambrose Evans-Pritchard made this point very eloquently in a recent article for the Telegraph....

Germany’s EU commissioner Günther Oettinger said Europe should send blue helmets to take control of Greek tax collection and liquidate state assets. They had better be well armed. The headlines in the Greek press have been "Unconditional Capitulation", and "Terrorization of Greeks", and even “Fourth Reich”.

#6 Everyone knows that Greece simply cannot last much longer without continued bailouts. John Mauldin explained why this is so in a recent article....

It is elementary school arithmetic. The Greek debt-to-GDP is currently at 140%. It will be close to 180% by year’s end (assuming someone gives them the money). The deficit is north of 15%. They simply cannot afford to make the interest payments. True market (not Eurozone-subsidized) interest rates on Greek short-term debt are close to 100%, as I read the press. Their long-term debt simply cannot be refinanced without Eurozone bailouts.

#7 The austerity measures that have already been implemented are causing the Greek economy to shrink rapidly. Greek Finance Minister Evangelos Venizelos has announced that the Greek government is now projecting that the economy will shrink by 5.3% in 2011.

#8 Greek Deputy Finance Minister Filippos Sachinidis says that Greece only has enough cash to continue operating until next month.

#9 Major banks in the U.S., in Japan and in Europe have a tremendous amount of exposure to Greek debt. If they are forced to take major losses on Greek debt, quite a few major banks that are very highly leveraged could suddenly be in danger of being wiped out.

#10 If Greece goes down, Portugal could very well be next. Ambrose Evans-Pritchard of the Telegraph explains it this way....

Yet to push Greece over the edge risks instant contagion to Portugal, which has higher levels of total debt, and an equally bad current account deficit near 9pc of GDP, and is just as unable to comply with Germany's austerity dictates in the long run. From there the chain-reaction into EMU's soft-core would be fast and furious.

#11 The yield on 2 year Portuguese bonds is now over 15 percent. A year ago the yield on those bonds was about 4 percent.

#12 Portugal, Ireland and Italy now also have debt to GDP ratios that are well above 100%.

#13 Greece, Portugal, Ireland, Italy and Spain owe the rest of the world about 3 trillion euros combined.

#14 Major banks in the "healthy" areas of Europe could soon see their credit ratings downgraded. For example, there are persistent rumors that Moody's is about to downgrade the credit ratings of several major French banks.

#15 Most major European banks are leveraged to the hilt and are massively exposed to sovereign debt. Before it fell in 2008, Lehman Brothers was leveraged 31 to 1. Today, major German banks are leveraged 32 to 1, and those banks are currently holding a massive amount of European sovereign debt.

#16 The ECB is not going to be able to buy up debt from troubled eurozone members indefinitely. The European Central Bank is already holding somewhere in the neighborhood of 444 billion euros of debt from the governments of Greece, Italy, Portugal, Ireland and Spain. On Friday, Jurgen Stark of Germany resigned from the European Central Bank in protest over these reckless bond purchases.

#17 According to London-based think tank Open Europe, the European Central Bank is now massively overleveraged....

"Should the ECB see its assets fall by just 4.23pc in value . . . its entire capital base would be wiped out."

#18 The recent decision issued by the German Constitutional Court seems to have ruled out the establishment of any "permanent" bailout mechanism for the eurozone. Just consider the following language from the decision....

"No permanent treaty mechanisms shall be established that leads to liability for the decisions of other states, especially if they entail incalculable consequences"

#19 Economist Nouriel Roubini is warning that without "massive stimulus" by the governments of the western world we are going to see a major financial collapse and we will find ourselves plunging into a depression....

“In the short term, we need to do massive stimulus; otherwise, there's going to be another Great Depression”

#20 German Economy Minister Philipp Roesler is warning that "an orderly default" for Greece is not "off the table"....

''To stabilize the euro, we must not take anything off the table in the short run. That includes, as a worst-case scenario, an orderly default for Greece if the necessary instruments for it are available.''

Right now, Greece is caught in a death spiral. The more austerity measures they implement, the more their economy slows down. The more their economy slows down, the more their tax revenues go down. The more their tax revenues go down, the worse their debt problems become.

Greece could end up leaving the euro, but that would make their economic problems far, far worse and it would be very damaging to the rest of the eurozone as well.

Quite a few politicians in Europe are touting a "United States of Europe" as the ultimate solution to these problems, but right now the citizens of the eurozone are overwhelming against deeper economic integration.

Plus, giving the EU even more power would mean an even greater loss of national sovereignty for the people of Europe.

That would not be a good thing.

So what we are stuck with right now is the status quo. But the current state of affairs cannot last much longer. Germany is getting sick and tired of giving out bailouts and nations such as Greece are getting sick and tired of the austerity measures that are being forced upon them.

At some point, something is going to snap. When that happens, world financial markets are going to respond with a mixture of panic and fear. Credit markets will freeze up because nobody will be able to tell who is stable and who is about to collapse. Dominoes will start to fall and quite a few major financial institutions will be wiped out. Governments around the world will have to figure out who they want to bail out and who they don't want to bail out.

It will be a giant mess.

For decades, the governments of the western world have been warned that they were getting into way too much debt.

For decades, the major banks and the big financial institutions were warned that they were becoming way too leveraged and were taking far too many risks.

Well, nobody listened.

So now we get to watch a global financial nightmare play out in slow motion.

Grab some popcorn and get ready. It is going to be quite a show.

KUHNER: Obama and the lunatic left! By Jeffrey T. Kuhner-The Washington Times

President Obama is politically insane. This is the real meaning of his speech Thursday night in front of a joint session of Congress. Albert Einstein defined insanity as doing the same thing over and over, expecting a different result. By that definition, Mr. Obama is a lunatic leftist.

Much of his speech called for more of the same - government activism; massive spending on infrastructure, bridges and roads; extending the payroll tax cut; and more public aid to states and municipalities. In short, he seeks to perpetuate the dismal policies of Obamanomics. He is a reckless ideologue masquerading as a pragmatist.

Mr. Obama’s presidency has been dominated by one seminal reality - failure. His nearly $1 trillion stimulus; record budget deficits; unprecedented levels of public spending; the government bailouts of the auto, insurance, housing and banking sectors; billions heaped on “green jobs”; Obamacare; Dodd-Frank to reform Wall Street, and huge outlays for food stamps and unemployment benefits - all have failed to restore the economy.

In fact, they have done the opposite. Unemployment is 9.1 percent. Growth is anemic. In August, no new net jobs - none - were created. Consumer confidence is low. Inflation is rising. The value of the dollar plummets. Burdensome regulations are strangling business. America is being buried under a mountain of debt. For the first time in history, its credit rating has been downgraded. The country is not only on the verge of national bankruptcy, but of economic collapse.

Any reasonable person would change course - but not Mr. Obama. He is a big-government liberal who worships at the altar of statism. The fact that we are broke and can no longer afford his borrow-and-spend policies means nothing. Like all fanatics, he is disconnected from reality.

Contrary to popular myth, liberalism is not politics committed to science or rational thought. It is a substitute religion - a secular philosophy similar to Marxism that seeks to replace Christianity and provide believers with existential meaning. Hence, it must be defended at all costs, even in the face of irrefutable evidence or logic. Mr. Obama is not an anomaly among progressives. They share his stubbornness. Reassessment is not possible. If Mr. Obama truly were to tack to the center, it would represent a fatal admission of error. The liberal faith would collapse.

This is why left-wing Democrats are demanding that he defy the Tea Party - and reality. Rep. Maxine Waters of California is urging Mr. Obama to pass another trillion-dollar stimulus. New York Times columnist Paul Krugman argues that Obamanomics has not spent, borrowed or taxed enough. The problem is not Keynesian liberalism, but the lack of sufficient zeal. In Bolshevik Russia, hard-core communists criticized Soviet leader Vladimir Lenin for not completely abolishing private property. They argued that it was Lenin’s “deviationism” from Marxist orthodoxy - not central economic planning and state socialism - that explained the failures of the Soviet system. For liberals, Mr. Obama is now the new Lenin.

Yet, Mr. Obama - like Lenin - cannot escape the consequences of his disastrous worldview. Whether it’s $300 billion, $1 trillion or $10 trillion - no amount of “stimulus” or public spending will provide a long-term cure for the ailing economy. The reason is simple: Government does not - and cannot - create wealth. Only the vibrant free market can.

This is why liberals are now left with only two options: lie about Mr. Obama’s record or engage in dangerous demagoguery. Democratic National Committee Chairwoman Rep. Debbie Wasserman Schultz is more of a cheap propagandist than a serious party spokesperson. Mrs. Wasserman Schultz insists that Mr. Obama’s stimulus “worked.” The “facts” speak for themselves, she says. They don’t. In 2009, Mr. Obama vowed that if the stimulus were passed, the jobless rate would remain under 8 percent. Under his tenure, America has lost more than 2 million private-sector jobs. Mrs. Wasserman Schultz is the equivalent of a Stalinist-era hack jabbering about the Soviet economic miracle. No one believes her - not even her staunchest supporters.

This leaves political gangsterism. Teamsters President Jimmy Hoffa recently said that it’s time for unions to declare “war” on Republicans and Tea Partyers. “President Obama, this is your army,” Mr. Hoffa thundered at a Sept. 5 Labor Day rally in Detroit. “We are ready to march. Let’s take these SOBs out and give America back to an America where we belong.” Mr. Hoffa’s comments were vile, reprehensible and could foment civil violence. Labor unions, such as the Teamsters, have a long history of street brawls and physically intimidating opponents. Once these kinds of furies have been unleashed, it is difficult to contain them.

The Democrats’ hypocrisy is staggering. For days following the Tucson shooting of Rep. Gabrielle Giffords and others, leading Democrats and the liberal media blamed conservative talk radio, Sarah Palin and a “climate of hate” for the massacre. Mr. Obama even called for a “new civility” and “tone,” tacitly chastising his critics. Yet, now that a key ally has called for blood to flow in the streets, the White House is silent.

Mr. Obama is a man of the hard left. He deeply loathes everything America stands for - capitalism, limited government, individual freedom and Christian civilization. In particular, he despises our exceptionalism. His stated goal is to create a “post-American world” where the United States is simply one of many countries - no bigger, better or stronger. He exhibits a form of madness, a self-loathing, reminiscent of the late pop singer Amy Winehouse. Mr. Obama keeps injecting the heroin of class warfare and socialism into our national bloodstream. And he can continue to play on the biggest stage and boast a huge audience. In the end, however, it leads to the same result: insanity and death.

Jeffrey T. Kuhner is a columnist at The Washington Times and president of the Edmund Burke Institute.

GoldNomics - Cash or Gold Bullion?

Economic Collapse Approaches - Preppers Shall Inherit the Earth

Even Goldman Sachs Secretly Believes That An Economic Collapse Is Coming!

Goldman Sachs is doing it again. Goldman is telling the public that everything is going to be just fine, but meanwhile they are advising their top clients to bet on a huge financial collapse. On August 16th, a 54 page report authored by Goldman strategist Alan Brazil was distributed to institutional clients. The general public was not intended to see this report. Fortunately, some folks over at the Wall Street Journal got their hands on a copy and they have filled us in on some of the details. It turns out that Goldman Sachs secretly believes that an economic collapse is coming, and they have some very interesting ideas about how to make money in the turbulent financial environment that we will soon be entering. In the report, Brazil says that the U.S. debt problem cannot be solved with more debt, that the European sovereign debt crisis is going to get even worse and that there are large numbers of financial institutions in Europe that are on the verge of collapse. If this is what people at the highest levels of the financial world are talking about, perhaps we should all start paying attention.

There is a tremendous amount of fear in the global financial community right now. As I wrote about the other day, the financial world is about to hit the panic button. Things could start falling apart at any time. Most of these big banks will not admit how bad things are publicly, but privately there is a whole lot of freaking out going on.

According to the Wall Street Journal, Brazil believes that "as much as $1 trillion in capital may be needed to shore up European banks; that small businesses in the U.S., a past driver of job production, are still languishing; and that China's growth may not be sustainable."

Perhaps most startling of all is what the report has to say about the debt problems of the United States and Europe.

For example, this following excerpt from the report sounds like it could have come straight from The Economic Collapse Blog....

“Solving a debt problem with more debt has not solved the underlying problem. In the US, Treasury debt growth financed the US consumer but has not had enough of an impact on job growth. Can the US continue to depreciate the world’s base currency?”

Remember, this statement was not written by some guy on the Internet. A top Goldman Sachs analyst put it into a report for institutional investors.

The report also goes into great detail about the financial crisis in Europe. Brazil writes about how the euro is headed for trouble and about how dozens of financial institutions in Europe could potentially be in danger of collapse.

But in any environment Goldman Sachs thinks that it can make money. The following is how Business Insider summarized the advice that Brazil gave in the report regarding how to make money off of the impending collapse in Europe....

Buy a six-month put option on the Euro versus the Swiss Franc, thus betting the Euro will drop against the Franc (the Franc being the currency that an official Goldman report recently referred to as the most overvalued in the world)
Buy a five-year credit default swap on an index of European corporate debt—the iTraxx 9. This is a bet that some of these companies will default, and your insurance policy, the CDS, will pay off
This is so typical of Goldman Sachs. They will say one thing publicly and then turn around and do the total opposite privately.

For example, prior to the financial crisis of 2008, Goldman Sachs was putting together mortgage-backed securities that they knew were garbage and marketing them to investors as AAA-rated investments. On top of that, Goldman then often privately bet against those exact same securities.

The CEO of Goldman Sachs has even acknowledged that the investment bank engaged in "improper" behavior during 2006 and 2007.

For much more on the history of all this, please see this article: "How Goldman Sachs Made Tens Of Billions Of Dollars From The Economic Collapse Of America In Four Easy Steps".

So will Goldman Sachs ever get into serious trouble for any of this?

No, of course not.

Yeah, they will get a slap on the wrist from time to time, but the reality is that the top levels of the federal government are absolutely littered with ex-employees of Goldman Sachs. Goldman is one of the "too big to fail" banks and they are going to continue to do pretty much whatever they feel like doing.

Sadly, the power of the "too big to fail" banks just continues to grow. At this point, the "big six" U.S. banks (Goldman Sachs, Morgan Stanley, JPMorgan Chase, Citigroup, Bank of America, and Wells Fargo) now possess assets equivalent to approximately 60 percent of America's gross national product.

Goldman Sachs was the second biggest donor to Barack Obama's campaign in 2008, so don't expect Obama to do anything about any of this.

We have a financial system that is deeply, deeply corrupt and all of that corruption is a big reason why things are falling apart.

Sadly, the 54 page report mentioned above is right - we really are facing a global debt meltdown and we really are heading for an economic collapse.

You aren't going to hear the truth from the mainstream media or from our politicians because "keeping people calm" is much more of a priority to them than telling the truth is.

The debt crisis in the United States is unsustainable and the debt crisis in Europe is unsustainable. Right now we are in the calm before the storm, and nobody knows exactly when the storm is going to strike.

But let there be no doubt - it is coming.

The amazing prosperity that we have enjoyed for the last several decades has largely been a debt-fueled illusion. It was a great party while it lasted, but now it is coming to an end and the aftermath of the coming crash is going to be absolutely horrific.

Keep watch and get prepared. We don't know exactly when the collapse is going to happen, but it is definitely on the way and now even Goldman Sachs is admitting that.

Debunking Money - 1 Myth and Machiavelli 1 of 5 Series