The Greatest Depression

[SaroDarksbane]

I've mainly been interested in the unsustainability of our debt-based monetary system, but Chris Martenson ties the need for our economy to increase exponentially to remain viable together with peak resource theory in a compelling manner:

[Technomancer]

I'm still confused about whether or not I should pay off the rest of my student loan. Predictors of fiat currency collapse and economic disaster keep advising to get out of personal debt. But why bother, says I? If there are millions of folk who each owe 100k, then what's the point of paying my loan off especially if the economy collapses? I already feel ripped off from paying most of it with the looming possibility that I may as well have never paid any of it.

I didn't know you were in a doomsday cult.

[jmervyn]

I don't think the dollar is overvalued. It's pretty low in comparison to the Euro and that's what the dollar should compare with, not the Chinese currency which is undervalued anyway.

It's definitely overvalued, but the Fed's "fan dance" prevents people from realizing to what extent. That's one of the reasons the Fed is desperately trying to refuse opening its 'books' {/channels vdzele}.

I changed all the bank notes into Euros and donated the coins.

Looks like one of us can still buy a meal at a German Pizza Hut (when I went there it ran ~$40 for a large pie).

I knew you will bite on that :azn:.

We're both becoming predictable.

You mean it would be best for all non-German EU members to bind their currency to a future D-Mark? Maybe a few small neighbour countries would do that, but there are none with currency problems (except maybe Belgium) and France, Poland and in particular England certainly won't.

I don't believe in doing so, though the Chinese and other countries certainly have and do. But by establishing a fully fixed exchange rate, you can generate some near-term benefits (again, like the Chinese have).

I'm down if Berlusconi gets to be the antichrist.

Sorry, but Soros is the one with delusions of godhood. Berlusconi just wants to chase tail.

Guess the central banks don't like competition, eh?

The remedy is to buy junk metal off of eBay. I did so, but nowhere nearly as much as I should have. I still remember gold trading at $350, yet I don't have any. :cry:

At least I have a privacy fence around my yard, and a nice garden going.

You don't have to worry about deer, but at the same time there's a significant overpopulation of two-legged vermin in both FL and NY.

Early next year I'm going to get my pitiful front and back doors swapped out for some heavier duty fare,

Same here. I have a metal double front door but it has a significant gap (at least it opens outwards), and glass patio doors on both ground and deck levels. You do what you have to.

maybe see about getting those metal roll-down hurricane shutters for my windows,

In krischan's world they're called "Rouladen" (and they're fantastic) whereas here for some obscure/obscene reason they somewhat feeble and cost multiple body parts. My guess is that people choose those ugly bars for security instead, so Rouladen remain rare.

replace a useless tree or two for some fruit or nut trees instead.

Given your location, citrus is an obvious choice - my in-laws had both orange and grapefruit rotting on the ground due to overabundance. I've apple, and am trying for some berry bushes, but the deer have pretty much ensured that my first years' crop was non-existent. Next year I hope to be doing better, but I'll need deer fencing.

That's why we haven't seen QE3 yet; Bernank is painted into a corner. He'll print in the end. He has to; like the scorpion and the frog, it's his nature.

He'd never do something that stupid; it would be like monetizing our debt! He's a student of the Depression!

Related Question: If France and the UK slip (further) into trouble, will the new acronym be PIIGSFUK?

Yeah, I'm hedging every which way. I don't hold any high interest debt (credit cards) to protect myself from deflation, but I'm not putting any extra on my mortgage or student loans in case of inflation.

That's kind of where I'm positioning myself. I've a moderate mortgage (which matches my old rental, though the NY bastages continue to raise taxes) and an unexpected car loan, but eliminated credit cards. I'm trying to badger my live-in-in-law into eliminating his credit cards, but the senile old coot keeps trying to play Daddy Warbucks and wants to "pay" for things.

What's stealing? If they demand to be paid in paper, I'll gladly repay them in paper.*

* Value of said paper not guaranteed.

Exactly. I expect to be able to pay off my car loan in cash if things go as I expect. The question is whether my in-law survives long enough to outrun his retirement. If he doesn't, I wonder whether he's actually on the right track; push his credit cards to the hilt and then die (his condo in St. Pete's isn't selling at $85K, but it would be seized if he doesn't gift it).

[krischan]

It's definitely overvalued, but the Fed's "fan dance" prevents people from realizing to what extent. That's one of the reasons the Fed is desperately trying to refuse opening its 'books' {/channels vdzele}.

Looks like one of us can still buy a meal at a German Pizza Hut (when I went there it ran ~$40 for a large pie).

And you tell me the dollar is overvalued?

Maybe you confuse prices with Norway? An average 35cm (14") pizza from the delivery service costs about €10-11 here, that's certainly not $40, more like $15.

The current rate is €1=$1,30-1.40. That has been the lower end of the dollar fluctuation from the times before the Euro. So no, the dollar is undervalued in comparison to the Euro.

The Rembinbi (or whatever) from China can't be taken serious, it doesn't reflect values properly. It's expected to rise sooner or later, however, as the Chinese people become more and more unsatisfied with seeing their government devalue their wages and if there's something which the Chinese government fears, it's a rebellion of their 1.3 billions of citizens.

[jmervyn]

And you tell me the dollar is overvalued?

Maybe you confuse prices with Norway? An average 35cm (14") pizza from the delivery service costs about €10-11 here, that's certainly not $40, more like $15.

Bear in mind that I'm talking 25 years ago. Plus, the Pizza Hut was an honest-to-goodness restaurant (downtown Gießen) whereas the ones in America are generally on the quality level of a 'greasy spoon'.

So no, the dollar is undervalued in comparison to the Euro.

I'd not argue the comparison; I'm talking about overvaluation compared to actual financial strength (just as the Renminbi is significantly undervalued by the Red Chinese). You're correct about the eventual fate of the Renminbi, incidentally, but the Red Chinese have to keep manipulating it lest they kill the golden goose and have millions of angry villagers expecting better standards of living than they would have.

[krischan]

Bear in mind that I'm talking 25 years ago. Plus, the Pizza Hut was an honest-to-goodness restaurant (downtown Gießen) whereas the ones in America are generally on the quality level of a 'greasy spoon'.

Prices were lower in the past, in particular with respect to gastronomy and the $/DM rate was about 1/2, sometimes more, sometimes less. When the Euro came, the bastards from the restaurants and pubs rose their prices drastically and €1 now = DM1 in 2000.

[BobCox2]

The Central Banks Are Doing What?

This morning the Fed along with the central banks of Canada, England, Japan, Europe and Switzerland rang the dinner bell and basically said to banks around the world, "You need money? Come and get it!" Of course, the central bankers themselves were a little more reserved in their press release. They described it as "coordinated actions to enhance their capacity to provide liquidity support to the global financial system."
Okay, that's a scary sentence so let's break it down:
"Coordinated actions" - We're going to work together. Why these central banks and no others? The Fed says "these five currencies are used globally and account for the bulk of the foreign currency funding of U.S. financial institutions." Really this is about two key players — the U.S. and Europe. No one believes that the financial crisis in Europe is really that they don't have enough Canadian dollars (Loonies to the rescue!) No, this is mostly about getting dollars to Europe.
"To enhance their capacity" - This is a polite way to describe the flood of money that is about to be made available to European banks.
"To provide liquidity support" - Bingo. It's all about liquidity. Basically, the banks in Europe are having trouble getting loans from other European banks. They need these loans to open their doors every morning. So "liquidity support" means the Fed will loan other central banks (the ECB) as many dollars as they want. Then each central bank (the ECB) can lend those dollars to the banks in their country that need them. These agreements are called "swap lines" because the country that lends their currency gets some of the other country's currency in return.
"To the global financial system" - Europe. Don't let them fool you — this is all about helping European banks. Nobody else needs this kind of help right now. Banks in Europe are having trouble getting people to lend them dollars. Why? Lenders are afraid that Europe's banking system is in trouble because a lot of the banks there are holding a lot of bad debt. Why do European banks need dollars? Because they lend money to people in the U.S. and because they have borrowed money from the U.S. and they need to pay these loans back in dollars


The comments at the link show a lot of disagreement - your thoughts Guys?

[vdzele]

It’s about creating post industrial societies. All of us under one government ruled by the bankers aka Usury Lords. New world order as the say.

Main features are low energy consumption, every aspect of your life is controlled and low population. You can do that only by controlling money. This crisis did not happen because we had manufacturing or resources problems. It’s about cutting flow of money so the societies stop doing what their doing and accept their terms. That’s what they did in 2008 in America by forcing Congress to give them money or else…

It’s about slowly cutting your standard of living so they can merge you more easily with other non western countries. They do that slowly so you don’t wake up – boiling frog strategy.

We can see them now blackmailing Europe to accept deeper integrations as part of the solution for the crises they deliberately created. Their proposals would be imposable to implement in a normal situation. They are calling Europe leaders to give up their sovereignties and they will fix your problems. As I said 3 years ago.

Usury Lords are bored and they have decided to reconfigure The Matrix. When you get desperate they will offer you The Solution for Your problem. They always do, so don’t be depressed how long it’s going to last. Eventually some politician will come on TV and make a proposal that you never dreamed off ...

As for your post:

They are flooding Europe with other currencies because there are massive bank runs here and people want to get out of euro. I am having rough times finding Swiss franks so I decided to hunt down Canadian dollars. Banks are having trouble because people are taking out their savings and converting them into commodities or some other stabile currencies. The source of this liquidity problem is fractional reserve system. Banks can loan out 50-100 times more money then they have in deposits. Fake money. All money is fake and is used to enslave you.

The issue which has swept down the centuries and which will have to be fought sooner or later is the people versus the banks.

~ Lord Acton (1834-1902) English historian

The Bolsheviks and the Comintern worked hand in hand with the international bankers. The latter, just like the Marxists, sought to destroy all national borders and establish a worldwide dictatorship - not a proletarian one, true, but a financial oligarchy.

- Christian Rakovsky, member of the Comintern during the 20’s.

[BobCox2]

Usury Lords are bored and they have decided to reconfigure The Matrix. When you get desperate they will offer you The Solution for Your problem. They always do, so don’t be depressed how long it’s going to last. Eventually some politician will come on TV and make a proposal that you never dreamed of ...

When I think back to the reception your Matrix posts got then v.s. now I think of this Thomas Paine Quote.

"It is never to be expected in a revolution that every man is to change his opinion at the same moment. There never yet was any truth or any principle so irresistibly obvious that all men believed it at once. Time and reason must cooperate with each other to the final establishment of any principle; and therefore those who may happen to be first convinced have not a right to persecute others, on whom conviction operates more slowly. The moral principle of revolutions is to instruct, not to destroy."

[jmervyn]

When the Euro came, the bastards from the restaurants and pubs rose their prices drastically and €1 now = DM1 in 2000.

Well, maybe Pizza Hut was a fluke - it was just before the Euro, and the Mark was quite strong against the Dollar in comparison with prior years.

When I think back to the reception your Matrix posts got then v.s. now I think of this Thomas Paine Quote.

Whereas I'm always reminded how much I miss Glenn Beck's better shows. Of course, Beck now has his underground shelter completed.