As I listen to the inside the beltway bickering of sound bites from “taxes on private jets” to “cut, cap and balance,” I cannot grasp that no one has simplified this discussion regarding debt and deficits. The way it is presented, many act as if debt and deficit are the same things when they are not, while just forgetting to explain that the real issue is our sovereign debt crisis as a nation and not liquidity. This means that the US economic woes are a function of structural problems we have while operating in a global economy.For example, around the globe, the real problem is not the governments (albeit they play a major role) but rather the banks and the possibility they may run out of money. In Ireland for example, it is more likely that banks will run out of loot before the government. Here at home, Bank of America recently made a bond issuance of $2.5 billion in new bonds. Why, because they are short on loot, running out of money and because the bank's stock just fell to fresh multi-year lows.
Both banks and governments are responding to the global debt crisis by adding more debt on top of debt. Adding debt to more debt is a pyramid scheme, a Ponzi scheme for to keep the pyramid intact, more loot is needed to keep those on top and under them making money. All kidding aside, looking a Greece for example, the fact is that Greece will never be able to pay back the debt it owes bond holders and the global markets.
It is not hard to see, but when you have a basically dumb-downed and ignorant electorate, the obvious gets lost in this age where talk and opinion takes the place of news and information. Or else it would be front and center that in the last year, the US dollar has fallen 12% in value which has led to making China the top seller of US treasury bonds worldwide. This means that the US government is an insolvent nation financially. We have accumulated a trillion dollar deficit three years in a row and a double dip in the housing market. Add to this the rising cost of oil and gas due to manipulation by speculators, mainly by the Goldman Sachs Commodity Index, and then it is easy to see what the outcome will be – a global economy run by a single corporate institution in the form of one world bank.
Ireland, which total debt is 100 percent of GDP, is insolvent. Greece, Italy, Spain, France and the US are all approaching the same boat. Why because the IMF, World Bank, Federal Reserve, Bank for International Settlements in Basle, Switzerland (a private bank owned and controlled by the worlds' central banks which were themselves private corporations) and similar agencies only work to see banks get paid, not that governments or democracy survive and prosper. If the US is to survive, it must function on a national credit system, which would lead to a sovereign nation state based on a system of our currency – the dollar. This would result in a non-inflationary credit system run by the state. But banks don’t want that, as Andrew Jackson and Lincoln found out centuries earlier.
If this does not occur, then we will continue, as a nation to involve ourselves in wars, for that will be the only way to make money. We will be in Pakistan, which will put us in conflict with China (which may involve India and Russia) and even in our own hemisphere in South America.
What is saddening is that most Americans do not have a clue, especially African Americans who often cannot see the trees for the forest through our own doing. History shows us that when the US economy goes awry, we feel it first and hardest. For we have limited if any knowledge of the collateralized debt obligations, complex financial papers/instruments, or the sophisticated computerized risk models that got us as a nation in this predicament. But we can spend, and buy and not save although property depreciations due to the foreclosure crisis will wipe out a significant amount of our wealth as a community and may cost us alone upwards of $190 billion dollars. After all everybody know we are the most vulnerable, especially loan companies, except for us.
Folk, America is broke. We the people are broke. The only thing I see on the horizon is debt on top of debt. But like all pyramid schemes, ours will fall or be found out too and our republic as we know it will be no longer and instead, a part of a new entity – the one world corporation.
