Wednesday, May 08, 2013
Economist: Say Goodbye To Your Life Savings
A record breaking stock market is distorting a frightening reality: The U.S. is being eaten alive by a horrific cancer that will ultimately destroy the economy and impoverish the vast majority of its citizens.
That's according to Peter Schiff, the best-selling author and CEO of Euro Pacific Capital, who delivered his harsh warning to investors in a recent interview on Fox Business.
"I think we are heading for a worse economic crisis than we had in 2007," Schiff said. "You're going to have a collapse in the dollar...a huge spike in interest rates... and our whole economy, which is built on the foundation of cheap money, is going to topple when you pull the rug out from under it."
Schiff says that, despite "phony" signs of an economic recovery, the cancer destroying America stems from a lethal concoction of our $16 trillion federal debt and the Fed's never ending money printing.
Currently, Bernanke and company is buying $1 trillion of Treasury and mortgage bonds a year. That's about $85 billion per month against a budget deficit that is about the same level.
According to Schiff, these numbers are unsustainable. And the Fed has no credible "exit strategy."
Eventually interest rates will rise... and when they do, Schiff says, stocks will tank and bonds dip to nothing. Massive new tax hikes will be imposed and programs and entitlements will be cut to the bone.
"The crisis is imminent," Schiff said. "I don't think Obama is going to finish his second term without the bottom dropping out. And stock market investors are oblivious to the problems."
"We're broke, Schiff added. "We owe trillions. Look at our budget deficit; look at the debt to GDP ratio, the unfunded liabilities. If we were in the Eurozone, they would kick us out."
Schiff points out that the market gains experienced recently, with the Dow first topping 14,000 on its way to setting record highs, are giving investors a false sense of security.
"It's not that the stock market is gaining value... it's that our money is losing value. And so if you have a debased currency... a devalued currency, the price of everything goes up. Stocks are no exception," he said.
"The Fed knows that the U.S. economy is not recovering," he noted. "It simply is being kept from collapse by artificially low interest rates and quantitative easing. As that support goes, the economy will implode."
A noted economist, Schiff has been a fierce critic of the Fed and its policies for years. And his warnings have proven to be prophetic.
In August 2006, when the Dow was hitting new highs nearly every day, Schiff said in an interview: "The United States is like the Titanic, and I'm here with the lifeboat trying to get people to leave the ship... I see a real financial crisis coming for the United States."
Just over a year later, the meltdown that became the Great Recession began, just as Schiff predicted.
He also predicted the subprime mortgage bubble burst, nearly a year before the real estate market fully crashed.
Schiff estimates this "cancer" could consume a trillion dollars from consumers this year.
"Today we're the world's greatest debtor nation. Companies, homeowners and banks are so highly leveraged, rising interest rates will be devastating."
According to polls, the average American is indeed sensing danger. A recent survey found that 61% of Americans believe a catastrophe is looming - yet only 15% feel prepared for such a deeply troubling event.
“Austerity” in Britain
"What austerity?" asks the super-sound UK economic commentator Liam Halligan in the Telegraph. GDP is down to be sure (6.2% below its pre-crisis peak), and we members of the public are indeed tightening our belts. Not so government. It's belt-tightening amounts to just 2.7% "cuts" over six years. That's after previous Chancellor/PM Gordon Brown expanded government spending by half, from 35% to 50% of GDP. Some "austerity" from our politicians!
The present government aimed to reduce its annual deficit to zero by 2015. In the wake of disappointing growth figures, that has now been expanded to 2018. Will it even be achieved? Most of the "cuts" were end-loaded, so the real complaints haven't even started yet.
Meanwhile, annual borrowing continues to add to the national debt. Even if that 2018 balanced-budget target is achieved, says Halligan, it still means that the national debt in 2017/18, at around £1.7 trillion, will be three times that in 2008. And the interest payments on that expanded debt all have to be met. It is money we could have used on something more useful, had we not been so profligate in the boom years.
Only virtual money-printing on a record scale has saved the government. How nice it is to have the monopoly on money, so you can just mint it to pay off your debts. But then your money loses its value, and lenders stop bailing you out again because they know they will be conned.
Investment, meanwhile, the one thing that might pull the UK out of its doldrums, has dried up. Private sector investment was just 1.2% of GDP in 2012, down from 5.8% in 2007. Businesses are sitting on cash, or paying off their debts, rather than risking money on an uncertain future.
As for the government, its "cuts" have fallen mostly on capital expenditure, nearly halved from £47bn in 2008/09 to just £27bn in 2014/15. That is the easy way to reduce your overspending – you don't have to fire anyone, or raise taxes too much, you just let the potholes get a bit bigger. But it does not tackle government's bloated spending appetite, nor lay down capital for tomorrow.
And now the IMF are joining the pleas to go steady on "austerity". As I said: "What austerity?"
Democrats go home!
Allergen producing plants aren’t the only things that can cause you grief and make your life a choking misery. There’s something else out there that can make your life miserable, cause you to feel bloated, tired, out of sorts. This allergen can destroy initiative and make you lazy and unmotivated. It robs you of the joy of achievement and the rewards of hard work. There are but a few places in this country where this weed hasn’t taken hold, and those places are threated. The noxious weed I’m talking about is Democrat big government liberalism.
So ... here’s what I’m driving at here. I live in Naples, Florida. Naples is a very successful smaller city ... or town, if you will. A year or so ago Naples scored the highest life expectancy for women, and was number two for men. The recession hit Naples, of course, but not nearly as hard as other areas of the country. There’s no state income tax in Florida, and in Collier County and Naples having to deal with a county or city employee, for a new license plate, for instance, is rarely unpleasant. Crime? Well some woman did attack a man at the beach with a swim noodle last year. Unemployment in the Naples area remained lower than the nation, home prices are recovering and the economy is vibrant.
So for the last 50 years people have been moving to Naples to escape the mess they caused by putting liberal Democrats in charge of their old hometowns. They’ve fled high taxes, poor schools, unionized work forces, crime, corruption and the economic malaise that comes packaged with most Democrat governments. No problem! That’s great! It’s called “voting with your feet.” Our country was founded by people fleeing an oppressive government for more liberty! It’s much the same thing as moving away from all those allergy-causing trees and shrubs to a new area where the air is cleaner and your teeth don’t itch.
Now my question: If you moved to Naples, or to Texas, or to a number of other low-tax regions not run by Democrats to improve your enjoyment of life, then can you please tell me just why in the hell you want to then turn around and put the very same species of politicians – liberal Democrats that chased you away from your old home – into office in your new home? Why would you plant those allergy-causing plants you moved to get away from in your new back yard? You move to an area where Republicans are and have been in control of the government for decades because you like what they’ve created, and you start voting for Democrats? Are you NUTS? Are old self-destructive habits that hard to break?
There was a little Naples rally in support of Hillary Clinton over the past weekend. Twenty people showed up. That’s 20 too many. What is your problem? Do you think it is people like Hillary Clinton that made our town the great place to live it is today?
Look at Colorado! That place used to actually make sense! Then people fleeing high-tax, highly-regulated California came there to take advantage of a lifestyle created by small-government Western conservatives, and now look what you have? Hickenlooper? Sounds like a disease, doesn’t it. Irrationalitis Democratus. Are you kidding me?
Our request is simple. If you love big government creating a dependent class of parasites and choking the life out of business, stay the hell where you are. You DID build that … so stay there and enjoy it! Self-reliant, liberty-loving Americans built something entirely different in Naples, in Texas and in other havens of rationality. If you want to move here, fine. But can you leave your noxious weeds behind please?
The Left's Sick Fetish for Cop-Killing Radicals
By Michelle Malkin
There's a stomach-turning segment of the American population that sees surviving Boston bomber suspect Dzhokhar Tsarnaev as a romantic maverick. The New York Times mused about the accused jihadist's "Holden Caulfield-like adolescent alienation." Pop singer Amanda Palmer wrote a fan girl "Poem for Dzhokhar." An adoring "Free Jahar" movement thrives on social media.
Fringe, you say? Think again. The fetish for cop-killing fugitives and cop-hating radicals is a mainstay of Hollywood, academia, the liberal media and Democratic Party circles. It has persisted for decades. It reared its head on May Day with rock-hurling anarchists in Seattle and D.C. shouting "F**k the pigs" and kicking cops. And consider the exaltation of the woman just named to the FBI's Most Wanted Terrorist list, Joanne Chesimard.
On Thursday, the feds announced that they are doubling their reward for the capture of Chesimard (a.k.a. "Assata Shakur"). The former Black Panther and Black Liberation Army agitator has been a fugitive from justice for nearly 40 years and openly thumbs her nose at her victim's family while living in Cuba as a political asylee. Congressional Black Caucus members have stubbornly protested extradition efforts, invoking the poisonous race card and deifying Chesimard as a "political prisoner." Columbia University professor Marc Lamont Hill glorifies her as a "freedom fighter."
Just last week, rapper Common added an Assata Shakur tribute verse to Jay Z's recent "Open Letter" rap defending his wedding anniversary trip to Chesimard's sanctuary of Cuba. "The same way they say she was a shooter, Assata Shakur, they tried to execute her. We should free her like we should (convicted cop-killer) Mumia (Abu Jamal)," Common proclaims.
Chesimard/Shakur is the godmother of the late Tupac Shakur, a gangsta rapper whose genre spawned NWA's "F**k tha Police," Ice-T's "Cop Killer" and The Game's "911 is a Joke" ("I ought to shoot 51 officers for the 51 times that boy was shot in New York").
Mic check this: In 1973, Chesimard shot and killed New Jersey state trooper Werner Foerster execution-style during a traffic stop. The gunfight also left her brother-in-law, Black Liberation Army leader Zayd Malik Shakur, dead. At the time, the BLA had been tied to the murders of more than 10 police officers across the country. Chesimard, Zayd Shakur and another member were wanted for questioning in the murder of two of those cops when they were stopped.
Chesimard was convicted and sentenced to life in 1977, but escaped from prison two years later with help from violent left-wing accomplices. One of those thugs, Black Liberation Army killer Tyrone Rison, admitted to participating in a series of armored-car robberies, including a $250,000 heist in the Bronx on June 2, 1981, that left a Brink's guard dead. Rison also confessed to taking part in the planning of the Rockland County, N.Y., $1.6 million Brink's robbery by left-wing domestic terrorists on October 20, 1981. Police officers Waverly Brown and Edward O'Grady and Brink's guard Peter Paige were murdered during the siege.
Chesimard's brother, Jeral Wayne Williams (a.k.a. Mutulu Shakur), was the convicted ringleader of the group responsible for murdering those law enforcement officers; he also masterminded Chesimard's escape. His release is set for February 2016.
Celebrated left-wing heroine Kathy Boudin and her then-husband David Gilbert were convicted for their role in the bloody Rockland County robbery. Boudin and Company, as I reported in March, are the inspirations for Robert Redford's new movie love letter to the Weather Underground. Boudin now holds an adjunct professorship at Columbia University's School of Social Work, along with a scholar-in-residence post at New York University, as the New York Post reported in April. The adoptive parents of her son, Rhodes scholar and Yale legal fellow Chesa Boudin, are Weather Underground militants-turned-academics Bill Ayers and Bernardine Dohrn.
Susan Rosenberg, a violent "progressive" domestic terrorist who participated in bombings of the United States Capitol Building, three military installations and other sites during the 1980s, was a principal getaway coordinator for Chesimard, Shakur, Boudin, et al. After receiving a pardon from Bill Clinton, Rosenberg taught literature at John Jay College of Criminal Justice and was offered a teaching position at Hamilton College.
Blogger Bill Ardolino, whose father was a N.J. state trooper and classmate of murdered N.J. trooper Werner Foerster, recounted Chesimard's chilling lack of remorse: "After their capture, my father was part of the team assigned to guard the severely wounded Chesimard in the hospital. As the troopers stood outside of her room, she incessantly chanted, 'If I had some poison gas, I'd throw it on your white ass.' ... Today she walks free as a professor, counter-cultural heroine and published author reviewed by The New York Times: "A deftly written book ... a spellbinding tale."
From Free Assata to Free Mumia to Free Jahar, the left's police-bashing bloodlust is not just a sick joke. Their romanticizing of cold-blooded terrorism is a pathology. Twisted Dzhokhar Tsarnaev summed it up in three letters for his friends while still on the lam for committing a deadly terrorist attack, murdering a police officer and wounding another:
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Posted by JR at 12:13 AM