The Best Explanation of the Federal Reserve & Money Supply

The Biggest Scam In The History Of Mankind – Who Owns The Federal Reserve? Hidden Secrets of Money 4.  Inflation, the IRS, the debt ceiling, and the personal income tax are covered as well. Bonus Presentation here: Who owns the Federal reserve? You are…

Epitome of a #HousingBubble in #SiliconValley

A new documentary filmed by local Bay Area residents explains it all. This can’t last.

This has got to be the biggest, most glaring sign of a real estate bubble I have ever seen in my entire life (and I was around for the 2004-2008 housing bubble).

RWC-Real-Estate-BuubleYes folks, step right up and get your 700 sq ft home in Redwood City, California, heart of the #SiliconValley, for just $649,000! The American Dream! 1 bedroom, 1 bath for just $3154 per month on a mortgage with super low interest rates if you put down 20%.

AWESOME! I feel so privileged to be in this AMAZING job market, this AMAZING country! Only in America!

If you pay the mortgage back according to the standard 30 year schedule, in April 2045 you will have paid $1,135,721 for a tiny little fucking shack.  BRILLIANT!

My question is, who would pay this kind of money for a little shack? Who has the intellectual capacity to make enough money to afford the place and yet choose to “invest” in a tiny shack?

See all the glorious details of this wonderful home here.

mortgage on a shack

On Preventing the Next #BailIn for #TBTF and The Global Bankers’ Coup

This is the first big move by the banksters in the legal space for a long time.  If Elizabeth Warren is pissed, then you KNOW the banksters did something illegal, immoral, unethical, and will likely cost taxpayers more money. It’s time to pass #GlassSteagall.  It’s time to #AuditTheFed. It’s time to build #PublicBanking.  It’s time for the #MonetaryReformAct supported by Bill Still. 

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“On December 11, 2014, the US House passed a bill repealing the Dodd-Frank requirement that risky derivatives be pushed into big-bank subsidiaries, leaving our deposits and pensions exposed to massive derivatives losses. The bill was vigorously challenged by Senator Elizabeth Warren; but the tide turned when Jamie Dimon, CEO of JPMorganChase, stepped into the ring. Perhaps what prompted his intervention was the unanticipated $40 drop in the price of oil. As financial blogger Michael Snyder points out, that drop could trigger a derivatives payout that could bankrupt the biggest banks. And if the G20’s new “bail-in” rules are formalized, depositors and pensioners could be on the hook.
The new bail-in rules were discussed in my last post here. They are edicts of the Financial Stability Board (FSB), an unelected body of central bankers and finance ministers headquartered in the Bank for International Settlements in Basel, Switzerland. Where did the FSB get these sweeping powers, and is its mandate legally enforceable?
Those questions were addressed in an article I wrote in June 2009, two months after the FSB was formed, titled “Big Brother in Basel: BIS Financial Stability Board Undermines National Sovereignty.” It linked the strange boot shape of the BIS to a line from Orwell’s 1984: “a boot stamping on a human face—forever.” The concerns raised there seem to be materializing, so I’m republishing the bulk of that article here. We need to be paying attention, lest the bail-in juggernaut steamroll over us unchallenged.” Finish the article here.

Knowing the White House and Congress are surrounded by Council on Foreign Relations and the Israeli lobby and they are both intricately interwoven with the banksters in the too big to fail banks and the Federal Reserve, it appears their plan is to go after OUR DEPOSITS and PENSIONS.  This is why the article is entitled “The Global Bankers’ Coup”.  It is a financial act of terrorism.

There are all kinds of alternatives to another bailout.  Let the too big to fail banks and their ponzi scheme Federal Reserve lending apparatus FAIL!

The Last 15 Years In the DJIA: 0.14% Annual Return

One of the great myths about investing that we’re told by the mainstream investment education is that we should “buy and hold” for the long term.
I remember being taught in a personal finance class long ago that I should just buy the S&P 500 index, walk away, and that years later I will have achieved huge gains.
The premise is that over a long period of time, it doesn’t really matter at what point you get in and out. The long-term trend of the stock market portends that you will make money.
It’s those kinds of investing myths that become axiomatic through repetition. You keep hearing the same thing over and over again and pretty soon people believe it.
Let’s look at the data.
It’s true that stock markets have plenty of peaks and troughs. Going back to the last relative peak, the Dow Jones Industrial Average (DJIA) hit just over 14,000 in October 2007; back then this was an all-time high.
If you had bought the DJIA back then, your return on the increase in share prices through today would work out to be a measly 3.5% on an annualized basis.
If you adjust that for taxes and inflation (even using the government’s own monkey numbers for inflation), you’re looking at a real rate of just 1.2%.
Now just think about everything that you saw in the last 7 years. The volatility. The risk. The turmoil.
Was it worth it? Probably not.
But if we go back further and hold an even longer-term view, the picture must brighten, right?
Let’s go to the peak before that. In early 2000, stocks once again reached what back then was an all-time high.
If you had bought the S&P 500 index back then (which is exactly what I was told at precisely the time that I was told), your annualized rate of return through today would be just 2.17%.
If you adjust that number for taxes and inflation, your real rate of return would be a big fat 0.14%… as in less than 1%. It’s practically ZERO.
Think about what you saw over the last 15 years in the markets—the collapse after 9/11, interest rates cut to zero, interest rates ratchet up again, huge swoons in markets, the credit crunch, Lehman’s collapse, the debt ceiling debacle, etc.
Is all that really worth a return of 0.14% per year? (i.e. 14 cents on every $100 invested)
It makes absolutely zero sense to do this with our money. But that’s what we’re forced into right now with most conventional investments at their all-time highs.
Bottom line—you don’t HAVE to be invested in the market. Sometimes the best investment you make is the investment you don’t make.
The challenge is, of course, that if you’re not invested in the market, your money is just sitting at the bank, earning less than the rate of inflation.
Welcome to the world of mainstream financial options. You’re damned if you do and damned if you don’t.
The conclusion here is very simple. It’s time to move on from the mainstream. There’s too much technology and too many global options now to be lulled into conventional investments that are born to lose.

30-300% Inflation on Goods You Buy Since 2000

We’re being hit with a double-whammy: Wages are under deflationary pressure, and almost everything else is exposed to inflationary pressure.
As correspondent Mark G. observed in Globalization = Permanent Instability, it’s impossible to understand inflation and deflation now except in a global context.
Now that prices for commodities such as oil and grain are set on the global market, local surpluses don’t push prices down. If North America has record harvests of grain, on a national basis we’d expect prices to fall as local supply exceeds local demand.
But since grain is tradable, i.e. it can be shipped to other markets where demand and thus prices are much higher, the price in North America reflects supply and demand everywhere on the planet, not just in North America.
If we put ourselves in the shoes of a farmer or grain wholesaler, this is a boon: why sell your product for 1X locally, when it fetches 2X in other countries? You’d be crazy not to put it on a boat and get double the price elsewhere.
As the share of the economy exposed to digitization increases, so does the share of work that can be done anywhere on the planet. When work is digitized, it is effectively commoditized, meaning that it no longer matters who performs the work or where they live.
If people in countries with low wages can perform the work, why on Earth would you pay double to have high-wage people do the work? It makes no sense. Taking advantage of the differences in local pay scales is called labor arbitrage, as the employer is trading on (i.e. arbitraging) two sets of prices.
It’s not just labor that can be arbitraged: currency, interest rates, risk, environmental regulations, commodities–huge swaths of the global economy can be arbitraged.
The basic idea of the global carry trade is to borrow money cheaply in a currency that’s weakening and use the money to buy low-risk, high-yield assets in currencies that are gaining in relative value.
It’s a slam dunk arbitrage: not only does the trader earn an essentially free return (borrowing yen at 1%, for example, converting the yen to dollars and buying Treasury bonds paying 3%), but there is a bonus yield on the dollar strengthening against the yen: a two-fer return.
Global labor is in over-supply–one reason why wages in the U.S. have been declining in real terms, i.e. when inflation is factored in. The better description is purchasing power: how much can your paycheck buy?
Here is a chart reflecting the decline in purchasing power of U.S. earnings since 2006:
Courtesy of David Stockman, here is a chart of inflation (i.e. loss of purchasing power) since 2000:
Whatever isn’t tradable can skyrocket in cost because, well, it can–since there’s little competition in healthcare and school districts, both of which operate as quasi-monopolies, school administrators can skim $600,000 a year: Fired school leaders get big payouts:
A former Union City, CA superintendent took home more than $600,000 last year, making her the top earner on a new online database tracking salary and benefit information for California public school employees.
Since healthcare is only tradable at the margins, for example, medical tourism, where Americans travel abroad to take advantage of treatments that are 20% the cost of the same care in the U.S., healthcare costs can rise 500% when measured as a percentage of wages devoted to healthcare:
Note that this doesn’t mean that healthcare costs rose along with wages–it means a larger share of our earnings is going to healthcare than ever before. Other than a brief period in the 1990s when productivity gains drove wages higher, healthcare costs have risen faster than earnings every decade. The consequence is simple: the more of our earnings that go to healthcare, the less there is for savings, investments and other spending.
In a way, we’re being hit with a double-whammy: whatever can’t be traded, such as the local school district and hospital, can charge outrageous fees and pay insiders outrageous sums for gross incompetence, while whatever can be traded can go up in price based on demand and currency fluctuations elsewhere.
Meanwhile, as labor is in over-supply virtually everywhere, wages are declining when measured in purchasing power. Wages are under deflationary pressure, and almost everything else is exposed to inflationary pressure. No wonder we feel poorer: most of are poorer.
re: inflation, #auditthefed, #ENDTHEFED