"A Tremendous Secret" (resetting the monetary system)

[ninakat]

"A Tremendous Secret"
7/14/2009
by John Rubino

[dbairdsevilcousinjimmy]

"Call me contrarian, but I say that when the rubber band breaks this time it will snap back with a speed and fury that will make your head spin.

Ya I am totally down with that!

[Connovar]

I do not think this is tinfoil - dare i say it makes sense?

[feelingweird]

This is an important piece to read and more importantly UNDERSTAND.

This is exactly what I was trying to verbalize when we were having all these Inflation/Deflation arguments last year. Deflation/Inflation only matters when a currency has value, what happens when it ceases to have value? What then?

SHORTAGES and RATIONING!!

That is what is in our future and that future is much closer than any of us want to believe. Even those of us on this board.

What can you do? EXHANGE THOSE SOON TO BE WORTHLESS pieces of paper in for real things. That is my plan.

Even to the point of getting a new pool liner put in today. I know its wasteful to a certain degree, but it will last me well over 12 years. Better to do it now while I can still actually get it done, then to wait till all the water pours out of it and I'm stuck with a 40 x 20 foot x 8 foot deep hole in my backyard.

To me the liner is worth more than the dollars at this point.  A massive devaluation is the only move they have left at this point. They have been monetizing the debt now or over 12 months and it is only getting worse not better. The amount of "non federal reserve money" is getting smaller at each auction and the amount of Monetization is getting higher.

The next step is a massive devaluation of the US Dollar coupled with a switch to some other global system of clearing.

This is OBVIOUS and should be how you are positioning yourself for the future. NOT DEFLATION, NOT INFLATION, but SHORTAGES and RATIONING...

Look around and decide what you would rather have in your life besides a pile of worthless dollars in your 401k or your bank account, or would you rather have THINGS of long term value? I decided that I would rather get as many things in place now, even if they cost a little more now. Because you could find 4 months from now that a pool liner isn't just 5 times more expensive, but that its not available because its a product of Singapore. Or the generator you wanted to get from Sears isn't just 10 times more expensive, but that Taiwan is no longer shipping to the US until a new monetary system is in place.

Think about it.

Robert

[wordnerd]

But Robert - I don't HAVE money to put things in place 
What I have now is what I will have to make do with
but thanks to LATOC I have been preparing for that
Not nearly as well as I wish I could - but the best that I can - with the money that I did have
Thanks

[lynnie]

Hey Robert...I saw an amazing new thing at BJ's ( big box store like SAMs). It was 180 bucks. A thingey that attached to your pool filter line and you put salt in your pool ( 1/10 the amount in sea water) so it doesn't feel and taste salty but the salt kills everything. No more chlorine or chemicals, just salt. It looked really worthwhile but I want to check it out farther.

[wordnerd]

A friend of mine has a pool in Florida - and he uses salt - not chlorine or chemicals
I don't know details - only that he uses salt

[ArmaGoof]

I have a question.  Probably naive, as I am not by any means a financial guru.  Some of you understand this stuff WAY better than I do.  There is always so much talk about TPTB who manipulate the worlds' money. 

What is the attraction of having power over an impoverished nation/world?

For instance, in my own little micro-universe, I and my wife hold dominion over our 26 year old unemployed son.  While there's a certain amount of ego stroking from knowing we're successful enough to "handle" it, it's a pain in the butt to actually HAVE to handle it.  If all the money is in the hands of a few, and there is no production from the many - on what can the money be spent?  Especially with a reset - if everyones' assets are devalued to unsustainable levels, from what pool of not-yet-owned wealth do TPTB pillage?  Once you strip the planet of its wealth, what's next?  What do you do for an encore after you win the Monopoly game?

Seems to me, the ONLY thing left to do is get RID of those you now find yourself sustaining.

It's simple math.  If 1% has 90% of the wealth, the 99% who need fed become a huge liability.  So, let's say they let, or facilitate a die-off of the 99%.  THEN what?  You got a bunch of fat cats waiting for someone to fill their bowl, except there's no one left who knows how to plow.  Just doesn't make sense to me.

[ashmeadskernel]

I have a question.  Probably naive, as I am not by any means a financial guru.  Some of you understand this stuff WAY better than I do.  There is always so much talk about TPTB who manipulate the worlds' money. 

What is the attraction of having power over an impoverished nation/world?

For instance, in my own little micro-universe, I and my wife hold dominion over our 26 year old unemployed son.  While there's a certain amount of ego stroking from knowing we're successful enough to "handle" it, it's a pain in the butt to actually HAVE to handle it.  If all the money is in the hands of a few, and there is no production from the many - on what can the money be spent?  Especially with a reset - if everyones' assets are devalued to unsustainable levels, from what pool of not-yet-owned wealth do TPTB pillage?  Once you strip the planet of its wealth, what's next?  What do you do for an encore after you win the Monopoly game?

Seems to me, the ONLY thing left to do is get RID of those you now find yourself sustaining.

It's simple math.  If 1% has 90% of the wealth, the 99% who need fed become a huge liability.  So, let's say they let, or facilitate a die-off of the 99%.  THEN what?  You got a bunch of fat cats waiting for someone to fill their bowl, except there's no one left who knows how to plow.  Just doesn't make sense to me.

That's simple.  You pay those who know how to plow, and you pay the soldiers to guard them, and you let everybody else who only know how to type die.  The plowers will be grateful to still be alive.  The soldiers will be grateful to have a job and rations of food from the plowers who appreciate their efforts to keep the raping and pillaging down.

And then you start fighting amongst your brothers for the spoils.  While the plowers and soldiers become even better buddies.  The attraction of having power over an impoverished world is this: if I can purchase food and protection by the mere penstroke, then I don't have to fear hunger or violence, like my great great grandpappy did.  The feeling of having food security without having to actually lift a finger is priceless.

[ninakat]

There does seem to be a growing consensus of suspicion about something bad coming down the pike this fall. Whether it's a reset of the monetary system, a fast crash of the dollar, or some combination of these and other monetary events.... hard to guess.

Jim Sinclair issued his 130 Day Warning, discussed in a thread here recently. 130 days from his posting date of June 29 puts the date at about November 6. Here's the direct link to Sinclair's warning, along with the link to the LATOC thread:

130 Day Warning
http://jsmineset.com/2009/06/29/130-day-warning/

http://www.doomers.us/forum2/index.php/topic,48231.0.html

[Jeromie]

The dollar has floated since August 1971.  Just how do you devalue a Dollar that free  floats other than letting it seek a lower level by letting speculators attack it?  What moves would encourage speculators to attack the Dollar so it falls by say half?   That is other currencies will buy twice the amount of present dollars.    

[ninakat]

Robert, thanks for your posting on this. I'm doing the same thing -- in fact, inspired by your generator purchase, I did the same last month. I agree that prepping for tangible items that might no longer be available is a smart strategy. I also still believe that silver and gold are good investments with any remaining savings. Having said that, I'm wondering what kinds of laws might be enacted at the time of a surprise monetary reset -- perhaps not direct confiscation, although that's still always a possibility, but perhaps new taxes on gold and silver transactions. But given the choice between fiat currencies and precious metals, the latter still seems much less risky.

[ninakat]

The dollar has floated since August 1971.  Just how do you devalue a Dollar that free  floats other than letting it seek a lower level by letting speculators attack it?  What moves would encourage speculators to attack the Dollar so it falls by say half?   That is other currencies will buy twice the amount of present dollars.    

I don't follow what you're saying. Why are speculators the ones you think will be responsible for devaluing the dollar? The article is suggesting that the monetary authorities will do the reset, and that this will happen during a "bank holiday."

[feelingweird]

I think more than anything the powers want to decouple the world from the dollar while at the same time keeping the underlying productive parts of the economy in tact. As was said in the larger article cited. He said that if you remove the overlay of the current global economic system, you still have a lot of productive means left in the world. Removal of the economic system doesn't have to be absolutely catastrophic. But if done rashly or chaotically it probably will be catastrophic.

I think the move afoot now is to remove the US dollar as the center of the floating currency system and replace it with something a little more global. I personally feel this will fail, but it will take more time. The goal I feel is to drastically reduce the consumption of the US while walking the short to medium term tightrope of not completely tanking the US and causing a civil war.

The US consumes a HUGE proportion of the globes resources. That was fine and dandy while there was excess, but in a world of dwindling resources, the US cannot continue to consume 25% of the worlds output while only representing 2 to 3% of the population. The math just doesn't work.

I think back to a piece I wrote years ago call Island Economics. In my hypothetical island they keep devaluing the underlying productivity of the island with Palm Leaf dollars. And so long as the devaluation is accepted by the islands inhabitants, it keeps working. But they must keep making  it bigger and bigger. And at some point the REALITY of the underlying productivity of the island can no longer be jived with the ridiculous amounts of paper money chasing it.

At some point the king is seen as naked. If they are successful in pushing the currency up one more level to a more global currency, they may buy themselves many more decades of shell shuffling. The wild card is how will the US reacts to a severe reduction in its standard of living? Will we bend and accept this outcome, or do we violently break and fly apart as a country?

Even though most of the evidence points to the contrary, I HOPE we bend and make the best of the situation. And that level heads prevail and we as a country get back to living within our means and become a truly productive people.

Robert

[Jeromie]

I keep hearing this 25 %  US energy use  versus 5 % of the population argument  shibboleth.   Just what are the NET  consumptions of US energy use over the last century?   We exported a lot of our oil and gas in the last century both directly and indirectly in  the agricultural products and manufactures.    We had a balanced trade account for most of the last century plus.   

Then "we" which realistically defined is North America seem to have possessed more of our own energy than most other areas of the world . Certainly we possessed far more than 5 % of world energy and if my look sees are an indication just might still have.  Over the past century North America has created a lot of technological advances that frankly enabled overpopulation to happen in the first place.   What kind of energy versus population spread would there be had we frankly  forbade as national policy exports of any kind that aided population survival in third world countries?  Might we then be 25 % of the world population and use 25 % of the world's energy?


The subject is far  too complex for the  comparison to have validity.      What is the energy use of Japan compared to it's population being a finished goods export nation to survive?    The US and Canada are wrecking a good deal of their arable land to provide cereals and other agricultural products to keep vast areas of the world from imploding.  What would be the effect of total cessation of exports of these products on third world populations?


Politically, the vast majority  of North American's  will obviously not settle for loss of disproportionate energy use.  They are the vast majority of the voting populations of North America.   Would they war to the death at some point beyond which they will not surrender their energy use?     Then again , they just might have enough of their  own energy to avoid energy imports along with some diminution of energy uses. But at some point there is a line in the sand. That line in the sand might not be far away 
facts, particularly political facts , are not faced head on.


I have posted a number of times that I favor a weak dollar. One that forces foreign Treasury  holders to spend the money in the United States to give us the advantage present exporter nations possessed the last thirty years.  Now it is their turn to buy our products, not our production assets.  We get the manufacturing advantage for the next generation.   High energy prices will insure domestic energy is exploited. 

My point is really that what I suggest will be forced on us very soon anyway.