Over the past year there has been some speculation that World War III is eminent. When the general public thinks of war, we conjure up images of horrific bloodshed and even the launching of nuclear weapons. But there is a more insidious weapon that is actually poised to devastate economies around the world. What we do know is that the fact that the Trump Administration is so ignorant about foreign affairs is poised to unleash a barrage of retaliation from our trading partners around the world. These tariffs you are considering if implemented could very well be a justification for destructive attacks on the very precarious US financial system by China, Japan, Russia, the EU, and OPEC nations, along with many other countries. .
The way this will play out is that these countries will begin to shed their holdings of American debt and, in doing so, will end up with the dollar as a world reserve state. This is only superficial. The real danger is an internal war waged against the global economy by central banks. It is the banks themselves that throughout history have deliberately created financial crises and collapses. Remember the financial crisis of 2008. That financial catastrophe for millions of Americans only made financial institutions that much richer when the US government and the Fed pumped trillions of fresh cash back into banks that were too big to fail. . If the US dollar were not the world’s reserve currency, the panic of 2008 would have made the Great Depression look like a picnic.
Today, large sums of wealth can be transferred in and out at the speed of light. The collapse of an economy or economies really means the destruction of the wealth of the bankers. It is the banks themselves that see national economies as simply put containers. The way this works is that banks can pour their wealth, which they can create out of thin air, as long as the US dollar is the world’s reserve currency, into one or more of these containers or economies. They can also circulate that wealth within the container or economy for a time and then pour out all of their wealth at any time.
We have to remind ourselves that the destruction of a national economy can be exploited as a means to a greater end. Generally, this so-called greater end means using the crisis to justify a further centralization of power or the transfer of power from the public into the hands of the people behind the bankers. Throughout history there have been such transfers. The liquidity crisis of 1914 just after the Federal Reserve was established and led to World War I. Let’s not forget the financial power grab by the banks when the League of Nations was created. In 1920 the artificial bubble in multiple asset classes created by the Federal Reserve with very low interest rates. That bubble burst when interest rates rose, sparking the Great Depression. The Depression in the United States coincided with other manufactured economic disasters in Europe and Asia that led to the rise of fascism and World War II. All of this greatly benefited the banking establishment as thousands of smaller banks were crushed. This was the beginning of the World Bank, the United Nations, the International Monetary Fund, and the beginning of the European Union. When we realize what has happened, we find that in every economic calamity ownership and bureaucratic control are consolidated into a kind of oligarchy. And, with every financial catastrophe, there is massive dependence on debt.
Today, we are in an era of burgeoning crisis and, believe it or not, the Fed is fueling the fire of disaster. A disaster that will unleash and explode, a controlled demolition of our financial system. Remember the massive dependency on debt? What we have today are three time bombs, all capable of causing untold mass destruction. Consumer Debt: Total American household debt at the end of 2017 exceeded $ 13 trillion. the highest in history. Over the past 5 years, consumer debt has increased. By the end of 2018, projected consumer debt will be even higher. Credit cards, car loans, mortgages, student loans, etc. all indicate that the so-called economic recovery is just smoke from the mirrors. There has been no legitimate creation or resurgence of wealth. There has just been increased reliance on the same debt that helped create the 2008 financial crisis. The Fed’s money only made those who were too big to fail the banks that much richer. When the Fed quietly raises interest rates, everything it does affects the many asset classes, including the housing markets, mortgages, etc., auto loans, credit cards, and student loans. In fact, when interest rates go up, all other areas of the economy come under pressure. The average person with record levels of debt is now faced with a financial nightmare.
Corporate debt is the most subversive crisis waiting to erupt. With rising interest rates and the amount of corporate debt already on the table, we are more than likely to see another stock market crash. Today, the S&P shows that at least 40% of 13,000 companies have a debt-to-earnings ratio of 5 times. An even higher level than before the collapse of 2008. We must consider that corporations have been exploiting low interest rates to borrow huge sums of cash for the sole purpose of buying their own shares. None of this money was used to increase employee salaries. Share buybacks are a legal form of market manipulation in which companies recover shares from the public, which in turn reduces the number of existing shares circulating on the market, artificially increasing the value of the shares overall. .
We must remember that share buybacks have been the main fuel for the longest bull market in history. But this bull market is so fake that even the mainstream media has started to question its validity. Stock buybacks are completely reliant on cheap debt. Unfortunately, cheap debt is no longer getting so cheap with the Fed raising interest rates. Eventually, perhaps sooner than we think, another stock market crash is inevitable.
The national debt has been the subject of many presidential debates, and yet it looms higher than ever. In the wake of a potential global trade war, the question arises of how long it will be before major holders of US Treasuries like China shed their holdings in retaliation. Trump’s insanity in refusing to acknowledge the seriousness of our continued increase in the national debt ceiling only concludes that our national debt will only increase. The Federal Reserve used to be the biggest buyer of American debt. But since interest rates have risen, the Fed will most likely not intervene when a trade war turns into a Treasury dump. When that happens, it will be too late for our dollar to no longer be the world’s reserve currency. And when that happens, all hell will break loose.
We better recognize that all three debt contingencies, each deepening each year, are catalysts for an economic catastrophe that will occur if not addressed as soon as possible. The longer we remain in a perpetual state of denial by elected officials and don’t realize how close we are to economic Armageddon, the sooner all Americans will pay a heavy price. A price that we can no longer afford. There is a way to deny the possibility of financial ruin, but it is necessary for our elected officials to first recognize how close we are to falling into the financial abyss. Then we have to implement the reforms that will deny the possibility of financial calamity by introducing the Ten Articles of Confederation of the National Economic Reform.
