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18 Signs That Global Financial Markets Smell Blood In The Water

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Can you smell it?  There is blood in the water.  Global financial markets are in turmoil.  Banking stocks are getting slaughtered right now.  European bond yields are absolutely soaring.  Major corporations are announcing huge layoffs.  The entire global financial system appears to be racing toward another major crisis.  So could we potentially see a repeat of 2008?  Sadly, when the next big financial crisis happens it might be worse than 2008.  Back in the middle of 2008, the U.S. national debt was less than 10 trillion dollars.  Today it is over 14 trillion dollars. Back in 2008, none of the countries in the EU were on the verge of financial collapse.  Today, several of them are.  This time if the global financial system starts falling apart the big governments around the world are not going to be able to do nearly as much to support it.  That is why what is happening right now is so alarming.  As signs of weakness spread, the short sellers and the speculators are starting to circle.  They can smell the money.

Back in 2008, bank stocks led the decline.  Today, that appears to be happening again.  The “too big to fail” banks are getting absolutely pummeled right now.  Most people don’t have much sympathy for the banksters, but if we do see a repeat of 2008 they are going to be cutting off credit and begging for massive bailouts once again, and that would not be good news for the economy.

In Europe, the EU sovereign debt crisis just seems to get worse by the day.  Bond yields for the PIIGS are going haywire.  The higher the yields go, the worse the crisis is going to get.

Meanwhile, as I have written about previously, a bad mood has descended on world financial markets. Pessimism is everywhere and fear is spreading.  The short sellers and the speculators are eager to jump on any sign of weakness.  Investors all over the globe are extremely nervous right now.

So what happens next?

Well, nobody knows for sure.

But things certainly do not look good.

The following are 18 signs that global financial markets smell blood in the water….

#1 Banks stocks are absolutely getting hammered right now.  Bank of America hit a 52 week low on Monday.  Bank of America shares declined 4 percent to $9.61.

#2 So far this year, Bank of America stock is down about 27 percent.

#3 Bloomberg is reporting that Bank of America may be forced to increase its capital cushion by 50 billion dollars.

#4 Shares of Goldman Sachs and Morgan Stanley are near two year lows.

#5 Shares in Citigroup fell 2.5 percent on Monday.

#6 Moody’s recently warned that it may be forced to downgrade the debt ratings of Bank of America, Citigroup and Wells Fargo.

#7 Barclays Capital, Goldman Sachs, Bank of America, JPMorgan Chase and Morgan Stanley are all either considering staff cuts or are already laying workers off.

#8 The deputy European director of the International Monetary Fund says that the Greek debt crisis is “on a knife’s edge“.

#9 Moody’s has slashed Ireland’s bond rating all the way to junk status.

#10 The yield on 2 year Portuguese bonds is now over 20 percent, the yield on 2 year Irish bonds is now over 23 percent and the yield on 2 year Greek bonds is now over 35 percent.

#11 Shares of Italy’s largest bank dropped by a whopping 6.4% on Monday.

#12 On Monday, the yield on 10 year Italian bonds was the highest it has been since the euro was adopted.

#13 On Monday, the yield on 10 year Spanish bonds was also the highest it has been since the euro was adopted.

#14 Shares of Germany’s largest bank fell by a staggering 7% on Monday and are down a total of 22% so far this month.

#15 Citigroup’s chief economist, William Buiter, says that without direct intervention by the ECB there is going to be a wave of sovereign defaults across Europe….

“Nothing stands in the way of multiple sovereign defaults except the ECB: they are the only game in town, there is nothing else”

#16 Cisco has announced plans to axe 16 percent of its workers.

#17 Borders Group has announced that it will be liquidating all remaining assets.  That means that 399 stores will be closed and 10,700 workers will lose their jobs.

#18 During times of great crisis, many investors seek safe havens for their money.  On Monday, the price of gold shot past $1600 an ounce.

These are not normal financial times.  The worldwide debt bubble is starting to burst and nobody is quite sure what is going to happen next.  Certainly we are going to continue to see financial authorities all over the world do their best to keep the system going.  But as we saw in 2008, things can spiral out of control very quickly.

Just remember, back at the beginning of 2008 very few people would have ever imagined that the biggest financial institutions in America would be begging for hundreds of billions of dollars in bailouts by the end of that year.

When confidence disappears, the game can change very quickly.  To the vast majority of economists it would have been unimaginable that the yield on 2 year Greek bonds would be over 35 percent in mid-2011.

But here we are.

The entire global financial system is a house of cards built on a foundation of sand.  It is more vulnerable today than it has been at any other time since World War II.  When a couple of major dominoes fall, it is likely to set off a massive chain reaction.

The global financial system of today was not designed with safety and security in mind.  It was designed for greedy people to be able to make as much money as possible as quickly as possible.  The banksters don’t care about the greater good of mankind.  What they care about is making huge piles of cash.

There is way too much risk, way too much debt and way too much leverage in the global financial marketplace.  You would have thought that 2008 should have been a major wake up call for financial authorities around the world, but very few significant changes have been made since that time.

The financial news is just going to keep getting worse.  This financial system is simply unsustainable.  It is fundamentally unsound.  The reality is that financial bubbles cannot keep expanding forever.  Eventually they must burst.

Over the next few weeks, keep a close eye on banking stocks and keep a close eye on European bond yields.

Hopefully things will stabilize.

Hopefully the next wave of the financial collapse is not about to hit us.

Hopefully the entire global financial system is not on the verge of a major implosion.

But you might want to get prepared just in case.

  • Mr. G

    Lots of regular people who are not paranoid have really been catching on this Summer. There is a feeling that the party is over. The economy is just too wrong in too many ways now. I do feel that we are going to see some good come from this. The decadence is coming to an end, as well. But I was asked for money at the gas station this evening. I feel that the USA will come back, someday, but it will take a lot of trial and trouble to put the decency back in this troubled nation. I hope it will not get so bad that people are hurt. So long as no one is injured, the money is just money, after all. Mr. G

    • Highspeed

      I am a man of faith and have always tried to have faith in my fellow man unless I’ve seen reason not to do so. Here lately, my faith in my fellow man is waning to say the least. I have sounded the alarm to my friends and loved ones to the point of exhaustion and I’ve even been mocked by many for my ” survivalist mentality”. Most people are so lazy and so dependent on our government coming thru for them that they aren’t the least bit worried about a collapse. I know preachers, lawyers and doctors who scoff at the thought af an economic collapse. The only people who dare listen and research the very real likelyhood of a collapse are regular people like myself who have heard stories about the great depression and learned from them. I have been so vocal in my warnings to people about the coming problems that I now look for many of them to show up at my house with their hands out. I am telling you, from where I sit, I have already done all I can do for them. Unless you live in a place where hungry, desperate and wicked people can’t get to you, you are sure to see some violence.

      Get ready now, both physically and spiritually.

      • josh

        “I now look for many of them to show up at my house with their hands out”

        this is why i stopped talking about it with people.

      • Katie

        I know it is frusterating but don’t give up hope. My coworkers, family and friends all think I am paranoid too and I am the butt of most of their jokes. But I will keep at it. Every gardener will tell you there is no way to tell which seeds will grow and which will not but you plant them all anyways. It is my view that every news article I forward on is like a little seed and hopefully at least a couple of them will sprout. Can’t hurt to try…

    • Mad Max

      Mr. G, I have to say I like and I don’t even know you. It is obvious that you have a hart. But are you kidding? In order for our country and the rest of the world to get in such a bad place, could only mean that our ignorance has to be equal to our crisis if not greater. And our crisis is far worse than we can know.

      We have a lot of pain ahead of us. It stems from our ignorance and arrogance, a deadly combination.

      OsiXs (Revolution 2.0)

  • dmitry

    ^ MR.G…your right my man.

  • ScoutMotto

    Last I heard, Iceland had the right idea: have no central bank running the show. Maybe enough people will wake up and see that the walls in their minds must come down.

    Get rid of the Fed and the IRS. Both are communist, and destructive.

  • stan

    By the end of September, things should really get ugly. Watch oil prices. Watch food prices and watch Helicopter Ben.

    The party is winding down

  • michelle

    Thanks for keeping us informed and giving us statistics and information to help us wake up as many people as possible so they can start getting ready for the collapse of our economy and the rebuilding of a better one.

    Time is growing short people. Good luck everyone.

    It’s “interesting times” for sure.

  • r.bitting

    More inflation, followed by QE3, then comes greater inflation with 2008 stock market dejavue, followed by QE4, then hyperinflation and game over.

  • Prophet

    I laugh when Wallstreet panics. They are the very cause of the financial woes this country finds itself in. They act surprised when, oh my gosh, unemployment keep rising? How could that be? They seem to think a few “policy” decisions can fix an economy that is built on a foundation of sand.

    They can print all the money they want and set interest rates to 0% (for the banks… not consumers) and it is not going to make this ponzi scheme any better. The fundamentals of this economy are rotted. Outsourcing, de-industrialization, fiat money system, dishonesty at all levels, and pure greed have destroyed this economy.

    Americans have no faith in this ponzi scheme any longer. Years of short term corporate profit strategies, scandals, insider trading, monopolies, have absolutely eviscerated consumer confidence.

    If Wallstreet wants to know why the Global economy is imploding, they need to look in the mirror. There stands a corporate elite without any moral compass to guide them. Years of “Crony Capitalism” have leveled this once prosperous nation. We find ourselves on the precipice of the greatest depression the world has ever known.

    The only way out of this is a return to what America once stood for. Then, only then, we might be able to rebuild what America once was. But, all I see is a degenerate, Godless, Immoral, and greedy people who do not love their fellow man.


    Mr. G,


    To put a very fine point on it, the Asylum States of America (A.S.A.) and the rest of the so-called global economy (code for the western world mainly) must fall. The sooner the economic collapse happens, the faster the remaining souls can go about the business of hopefully rebuilding a new Republic/world where the avariciously greedy are kept inside the box and not let out. It seems that the White Male Power Structure that the Bill O’Reillys of the world are so fond of finally allowed its unchecked greed to bring the world’s economy to its knees. But this could not have been done without tacit support from the local populace of each asylum state, seeing as how greed and crime at all levels of society is the rule rather than the exeception. Crime is king in the world, especially in the A.S.A, from the corrupt politicians in gov’t, to the greedy bankers and white collar workers of all Wall Street banks and businesses, down to the welfare and disability fund cheats at the common man’s level. Until the Culture of Crime and Corruption (CCC) are eliminated from societies at large, you will continue to see this pattern of greed, corruption, and fraud/debt fueled bubble/boom and bust cycles which do nothing but cause misery, pain, death and destruction. But this, by and large, is what people want, which is why corrupt people continue to rise to the highest levels of business and gov’t………………..

  • The Tyranny of Relativism

    Yes, there is lots of “Blood in the Water”.

    But, “They” have myriad “Accounting Gimmicks” and “Tricks” to keep the World Economy Propped Up for a while longer.

    “They” can keep “The Game” going for much longer than you think.

    Relax and Observe but don’t be too excited about the Coming Collapse of the World’s Economy–it will take longer to arrive than you can imagine.

    • 007

      They have a tot of tricks, but you give them credit for being more competent than they are. They almost let the whole thing collapse in 2008. They were very lucky to even slow it down.

      Once inflation reaches a point where interest rates have to be raised, it will be game over.

  • Doug in Jax

    Debt. Its not just the “banksters”, its the common greed of those who have created and populated the welfare state. Living off another’s labor is the ultimate form of greed and tyranny.
    Our social welfare state is a rotten corpse, that no one has noticed is dead.
    All that the Bush-Obama bailouts have done is kick the can down the road, and as always happens when the problem is debt, things have gotten worse with time, not better.
    We are choking in debt, and half the country firmly believes that the problem is that are debt limit isn’t high enough. This isn’t a problem that people reasoned themselves into, and it won’t be reasoned out of. The only fix is bankruptcy, which will force the idle and parasitical to explore the concept of work. There isn’t much to be had, so to eat, they are going to have to work for next to nothing.
    This is the price of thinking that you can vote yourself a free lunch.

  • Kathryn

    Read yesterday that Borders Books is closing it’s stores, laying off 10,700. And Cisco is laying off 11,700. I go walking early in morning, but today saw an individual quietly going from house house, checking the bins on the street that had been put out the night before, taking out all the recyclables he could carry before garbage trucks come. Must be pretty desperate to get up and do that before 5 am. He’ll probably be back next week. I used to take plastic bottles to recycle depot but the price was slashed in half, a big 1.5 liter bottle was worth 2.5 cents vs 5 cents previously. Inflation?? So if the poor soul can get a few pennies for his efforts at 5 am, well, there you have it. It all adds up I guess.

  • Arivernameddenial

    As long as America has the Christians-should be fine. Once the Christians are gone-the thing(Holy Spirit) that is holding back the end times- then all hell will break loose. Not because Christians are better than anyone else-but favored by God because of His word and promise. I do not deserve to escape, but God has promised escape for his people. Not based on me or my performance as a human. It is grace- getting what I do not deserve. That is why people should be running to God-now is the time for salvation. The age of grace and the church is running out. Jump on board now-people get ready there is a train a coming

  • Donald Wilson

    The greedy will get what they deserve.

  • Winston Smith

    There are still majority that-being this is the “indespensible” nation of USA, think that everything will get better and roaring economy and good times on the way…..

  • Getready

    If You Thought 2008 Was Bad… Get Ready
    The next Crisis is literally at our doorstep. And it’s going to kick off another 2008 episode ..
    Google these headlines;
    Perkins to close 58 restaurants
    Borders Closing All Stores in Connecticut
    US mall vacancies rise in 2nd quarter, rents flat
    Thorntons To Close 120 Stores Over 3 Years; Says Trading Still Challenging
    200 Gap stores around nation to be closed over next 2 years

    yes folks these are still the most horrifying times ever for the working man and women.
    soon most jobs will be so scarce you might end paying a headhunter for a job at McDonalds.

  • A.S.

    How is it possible that big companies can even ask for billions in bailouts when they:
    1. made billions in profits
    2. paid $0 in taxes
    3. got billions in bailouts in 2008
    4. the top CEOs took in tens of millions in salary, benefits, stock options, etc.

  • Jeff

    I am an optomist by nature, and generally believe that things will work out for the best.

    But the majority of the data presented on this blog is indisputably accurate, and that leads to some very ominous conclusions.

    Many days, I awake and wonder if this is what the world felt like back in 1929, on the verge of the stock market crash (another huge bubble) and the Great Depression.

    Security and a feeling of financial well-being are in short supply in 2011.

    • Agreed

      jeff wrote:
      ((((((Many days, I awake and wonder if this is what the world felt like back in 1929, on the verge of the stock market crash (another huge bubble) and the Great Depression.

      Security and a feeling of financial well-being are in short supply in 2011.)))))))

      We are all victims of the news media.
      No matter how hard the news media tries to put a spin on the economy improving, somewhere in between the lines we can all see through the Vail.
      When the Labor Department announced on June 3 that 13.9 million Americans are unemployed (9.1%), and that 4.8 people are competing for a single job, one would think this would trigger a national debate. But not in the United States. Our national media prefers to shift attention to tabloid-type stories that often, unlike economic statistics, have a sexual backdrop.

      The media views the ongoing economic malaise affecting tens of millions of Americans as not only “old” news, but as information that is not conducive to people buying advertisers’ products. In contrast, the Weiner story offered juicy new updates and photos, an embarrassing press conference, interviews with the affected women, and the underlying sexual backdrop that encourages consumer purchases.

  • C

    When things get really bad, only then will people come together and work on real solutions. Until then, greed is the norm, it’s infectious, and to many people have it, many don’t even know they have it, just working an occupation for a corporation or company that runs on greed for instance. When most of the basic needs for living are all capitalistic greed driven components, quality will have to suffer in order for people to keep getting rich.
    Sadly enough.., letting large entities, even governments to collapse is at least a step in the right direction.

    • Jeff

      You are so correct about the disease known as GREED.

      Everyone who works is entitled to their share of the American Dream, but some people have decided that they are entitled to WAY MORE than their fair share.

      When that happens, the hard-working people known as the Middle Class are destroyed.

  • Dr. Chicago

    Here is a few more to add to your list.

    #19. First half of 2011 Central banks purchased more gold than they sold.

    #20. Belarus (another European country but not of the European Union) has skyrocketing inflation (28% in 2011 so far).

    #21. The mideast is a flame. Egyptians have taken back to the streets; Libya is still having a civil war; Syria is routinely killing protesters and Saudi Arabia is doing it’s best to hide the social unrest inside it’s own borders.

    #22. Iran is considering dropping off 3 000 on its’ currency due to inflationary pressure.

    #23. News on Japan: debt, recovery effort of the tsunami, Fukashima, etc… has all gone eerily quiet. Japan, like Greece, is on the edge of a knife.

    #24. China…protests within their borders, due to food shortages, droughts and now brazenly pushing for fishing rights in the South China Sea which they did not have before….

    #25. US Debt Default… is this the straw that breaks the camels’ back?

    I could go on. It all impact the looming crisis that is gaining steam. We are at peak food; peak water; peak oil; peak population. People will start fighting to feed their families, cities and countries….

  • Mark

    This website is helping people begin to understand what might be coming. Many people will be hurt when they are cut-off from welfare and start to riot in the streets. Many have placed their future in a government that is broke. All they will do is print more dollars and collaspe the value of our savings if you have any. If you are able, store some food and other items to protect yourself and your family.

  • If they don’t smell blood in the water by now they need to find a new business to be in.

  • Too Many Fat Asses In The USA

    Go. On. A. Diet.

    • Ben Dover

      Many will, whether they want to or not.

  • Antonio Gonzalez

    I am sorry for the congress men and woman, I don’t any bank stock.

  • James

    The key word here is PREPARE. We’ve been blind to our collapsing environment for decades. America is resourceful and, with proper leadership, we can make it. We may even avoid catastrophe. But, there is no harm in being prepared.

  • jd

    The global economy is in for a colonic.

    And it’s going to hurt.

  • Gary2

    I smell that we will be taxing the rich hard and spreading their ill gotten gains to their rightful owners, namely the working people and poor. Just fresh from an OFA meeting-trust the president…the rich will be paying hard ha ha ha.

    Tax the greedy to help the needy.

  • Gary2

    According to conservati­ves lower taxes on the wealthy will create all the jobs we need… even though there is no actual evidence to support this. When asked about job creation after Bush lowered the tax rates their eyes glass over.

    I’m gonna go drop a “job creator” in the toliet right now…

    • Grumpy


      Really, Gary, get a new schtick. While you’re at it, make an attempt to learn about how ‘money’ actually works in today’s world. I’ve stated it before: if you taxed every US billionaire 100% of their income AND CONFISCATED ALL THEIR PROPERTY, you’d have enough money to fund the Feral Gubbermint for ONE YEAR (a bit less than that, actually).


      If you understood anything about the world monetary system, you’d know that the system itself needs to be replaced by a commodity-backed, exchangeable currency – NOT debt-based currency ‘notes’, as are currently used, abused, and stolen by the same people you want to give more of them to.


      • Rhinehart Fox

        Hey Grumpy. Don’t bother reacting to Gary. I’ve figured out that he is a troll. He just puts in his cliche response to get a reaction. Not worth the effort.

        Gary2 – if you want to go on vacation, just let me know. I can write your response for you. I always know what you are going to say before I get to your post. I don’t even think that you bother to read the contents of the article.

        • Gary2

          At least I am consistent!

      • Gary2

        I would then tax the shit out of the corporations that are sitting on record piles of cash.

        I would much rather have Obama take it and spend it on safety net programs for the poor.

        Tax the greedy to help the needy.

  • I’ve always wondered when the US would fall just like Rome. The thought passed my mind the last few years. I was thinking its possible that this could be the beginning of a slow change in power. Now that other countries are getting during hit with issues it seems like we just got hit first which I would think is a good thing.

  • Maria

    2008 was a tremor. The earthquake has yet to hit.

  • dw

    “I hope it will not get so bad that people are hurt.”

    Wishful dreaming Mr. G.

    Today you were ‘asked’ for money. When the person (or their family) is starving, you won’t be asked.

    When the food stamps don’t show, the cities will burn.

    • Ben Dover

      I have relatives on SSI. They will be dumbfounded when the deposits are not made. They all have cool phones, cable TV with all the bells and whistles, A/C, and eat out more than I can afford.

      • Gary2

        Tax the rich and spread the wealth. If the rich had not stolen productivity increases from the workers over the years the average wage would be $19 per hour and median household income would be 91,000 per year.

        Tax the MF rich and get our money back from these immoral scum bags.

  • The smart money seems to be moving to cash… Corporate insider selling to buying ratio is 3500 to 1. If reports are to be believed, George Soros’ hedge fund is now sitting 75% in cash waiting for better opportunities. While the debt ceiling issue is likely nothing but an Armageddon psyop that will probably be resolved at the last minute, any number of catalysts can set this thing off. And when the fuse is lit, as the article suggests, things will spiral out of control very quickly and will be much worse off than 2008… This time around Americans may finally realize that the last three years have been rife with lies…but it may be too late as savings and retirements are destroyed, more jobs are lost and any hope of a return to pre-crash normalcy disintegrates.

  • CatNap

    Pastor Lindsay Williams recently said in an interview with Alex Jones to keep an eye on the Euro. He said when it collapses, the dollar’s collapse is only a couple weeks behind.

    There’s a sign to make a hasty visit to your bank!
    Euro collapses, run and pull your cash out and head for the coin shop!

    Btw…he has been suggesting people cash out their 401K’s and Roth’s while they still can. Another market crash is expected. One that will bring it down below the 2008 crisis.

    • Otown Right Guy

      Why wait for the Euro to crash? Avoid the stampede. Trade those worthless federal reserve notes for real gold and silver NOW.


    Blood in the water was the name of the skit on the Colbert Report last night!

  • iamawake

    I agree, I think most people are starting to open their eyes about the economy. It has been unsustainable for a long time and time has run out. I just hope that we don’t march off to war in some vain attempt to divert the public’s attention.

  • Nostradamus

    So, we have all these signs that many major banks are in trouble.

    Excellent news!

    Banks’ job is to finance industry and act as depository manager. But many banks have assigned that business to the backroom long time ago. Run by some unimaginative accountants with regulators breathing over them. Something about low profit and lack of excitement.

    For a few decades, banks have moved into far more exciting business, based on products they invented. (Note *they* invented, not people invented). One by one, they transformed themselves into non-banks, running the business of their own inventions. Of course they never called themselves non-banks – so boring and dangerous. They use far sexier names to convey a sense of sophistication and wisdom.

    The business of the non-banks is to invent strange numbers out of think air and make them bigger numbers by spinning them mathematically. When regular people asks what are these numbers, the bankers would say something like “These numbers are money of course, and we can exploit inefficiencies of their underlying resources and increase financial value! Our methodologies are highly sophisticated, developed by an army of the smartest PhD, and operated by the world’s most powerful computer systems!!”

    But like the magical business of Mr Ponzi, the non-bank business is no more than speculation, gambling, and as we now know, a great deal of fraud.

    It is very simple: they take people or country’s money, gamble with them, give themselves a big profit for being the gambler, and stick the bill back to the people.

    That non-bank industry now exposed to be in the multi-trillion dollar. This is the amount they have spin up. But there is a problem – there is a huge loss. Not to the real economy (because these numbers are only math) but to other non-banks as they played each other for the greater fool.

    What to do? Well, stick the bill to the regular folks of course! But folks have wised up and refused. So the non-banks are now crying Armageddon like some sorry infant.

    So I welcome all the good news of ‘impending financial collapse’. Because it means the Ponzi of the non-banks are being reduced back to nothing, which is what they all started with. The non-banks have not added economic value. They have only added to the obscene profiteering of the gamblers who play the games of fake.

    Let the non-banks die a quick death. So that the real economy of real people can get on with their lives; and stop being suckers and slaves to fabricated debts.

  • 005

    It can be described like, a pile of dynamite with a new fuse added every day. It would almost resemble a strange looking “pin-cushion.”
    Just wondering what will set off any one of the “fuses.”
    The writer “Mr. G” has a point about people starting to catch on, the feeling is that we’re in a post-political time.
    That’s it

  • McKinley Morganfield

    The US Treasury also raised interest rates yesterday, 0.2% on the 10 year & 1% on the 30 year bonds to attract buyers. Granted this does not (yet) compare to the situation in the Euro zone, but it is a sure sign that the idea that US T-bonds are a safe haven is diminishing in the minds of investors around the world. The bond vigilantes are riding and our government will be pressured to raise interest rates more and more over the summer. If this occurs it will lead to the exponential increase in the growth rate of government debt.

    No one should panic right now as we can expect frequent fluctuations in all markets (stocks, bonds, metals). There will be dips and recoveries on a daily basis during the rest of this year. What to watch out for, as much as possible without a crystal ball, is an event or swift series of events that start the panic. Once the panic starts the crash will gallop around the globe in a matter of a few days at most. I suggest everyone research what happened in 1932 with the default of the Creditanstalt bank in Austria. This was the initial bank failure that triggered the collapse of banks all around the world and kicked off the depression of the 1930s.

  • James

    I say let the “Too Big To Fail Banks” fail. Start supporting your local banks that keep your money invested in local businesses. Invest in local mom and pop business enterprises, and agriculture efforts. All the money being loaned and borrowed today only benefit foreign governments and businesses that only support the Elites who own businesses overseas and do not care about, or support local businesses.

  • Mr. G

    I am sorry to say that this stuff is not even really about the economy. The economy is just an extention of our overall society, and our overall psychology. I am sad to say that we turned away from the time-tested ways long ago. The good ol’ days never existed, but it is a fact that all innocence and decency has been lost. If you happen to work with young people sometime, it’s an eye opener. No youthful idealism is to be found.

    I am particularly disturbed by the pragmatic materialists who hide behind an agnostic or atheistic philosophy so as to pretend that the wrongs done in the world don’t matter. You can be a complete atheist and still realize that nature does not like it when your society is a dump – the debts from those wrongs will come back to haunt you! You wrong people, they get hurt, then they get mad, then they get mean…

    I cannot convince any member of the “well educated” materialistic upper middle class that the nation is on the brink, while poor people and people who are rich don’t take much convincing. The very worrisome thing is that the rich people I know (and they aren’t evil) understand the dire nature of this situation best, and they are the most savvy and knowledgable! Look out, folks…

    Mr. G

  • Mr. G

    If I might add just a little more – I can be a little long winded –

    The reason I cannot convince the upper middle class of the looming disaster is simple – they are a prime cause of the disaster, and it is a fact that those who are doing wrong don’t want to hear the truth.

    Poor people did not cause it. I don’t care how lazy the guv-check recipients are (and this is largely a myth, though there is some truth) – people on the check did not cause it. Try the check sometime and you will learn that the US actually has only a very crude welfare system.

    The rich are greedy but they always were. Some were complicit – the ones running the banks and so forth. Most “everyday” rich people who are in business and so forth are just bewildered by what has happened.

    The upper middle class went hog wild since the mid 1980’s on a spending spree financed by credit. This culminated when they all started buying mansions they could not afford. In addition, they have stuck this country with their children – psychopathic aspiring professionals with no morals, sexual or otherwise. There are millions more of them on the way. This is what total materialism and 14 hours a day of TV brings you.

    I am not running down any particular individuals, so there is no need for any doctors or CPAs to take my statements personally. However, the upper middle class is a materialistic and atheistic lot – manipulative too. They fancy themselves intelligent due to their diplomas, and yet they are remarkably keen to be manipulated by the elite and their marketing. Many of them have distorted themselves so fully with their Dale C. “Social Skills” training that it is hard to find the real person inside there. Intelligent People – Totally Brainwashed.

    I view the main crooks in all of this as the ultra-elite banking sect and the upper middle class wannabees who could not live without all the yuppie fixings.

    My apologies to anyone who does not fit the profile I am using here. No one can be judged by membership in a “class.” I don’t like to stereotype. However, I have so much experience with the particular kind of people I am talking about here that I must speak out. They present themselves very well, but they are the future Nazis, the future fascists and brown shirts. No one likes to mention them because they appear to be upstanding citizens. But a great many are simply tools of the elite.

    Mr. G

    • McKinley Morganfield

      “The upper middle class went hog wild since the mid 1980′s on a spending spree financed by credit. This culminated when they all started buying mansions they could not afford.”

      One small correction… the entire middle class has been on this easy credit binge these past 30 years.

    • xander cross

      atheists did not help create this economic collpase. I find it funny that you did not metioned that most of the bankers are christians and believe in a god. (I know, I find that hard to believe as well) We are all in this together and again, this is why I inform people about this site especially when I am at work where people buy massive junk items everyday. When I tell people about inflation, some really do get it because they have been laid off, well, some just laugh it off and buy things on “credit”. Even though I am an atheist, I am glad that I found this site, it changed my life for the better and how to be prepared and being a better person, ethically, morally, and caring.

  • Mr. G

    haha, I outdid myself there, sorry – no insult intended to anyone – Great site, Michael. Best on the topic on the net.

  • Darin

    Actually, Borders is just obsolete and would be even in a good economy. I don’t think it counts as a sign of global financial armageddon, but 17 out of 18 is still pretty good.

  • El Pollo de Oro

    I certainly hope that things will stabilize. I certainly hope that “the next wave of the financial collapse is not about to hit us.” But then, I was also using the words “I certainly hope” back in 2006 and 2007. Back then, I was saying, “I certainly hope I’m wrong, but I think we’re headed for a major financial crash that is going to be nasty.” In 2007, I started referring to the former USA as The Banana Republic of America (BRA) because it was looking more and more like a Third World banana republic to me (unstable currency, massive debt, political corruption galore, police state in the making, torture, unconstitutional travel restrictions on innocent civilians). And in September 2008, it turned out that I was exactly right even though I really wanted to be wrong: the BRA ran into a brick wall financially, and the country entered a depression. So-called “economists” called it a recession, but I knew it was a depression. So did Gerald Celente.

    In October 2008, I went overseas (Italy and Greece) on some business for about a month. Night after night, the news on Italian television was about all the economic turmoil in Gli Stati Uniti and the repercussions in Europe. And several weeks after I left Greece, all hell broke loose in Athens. It was obvious that a period of frightening instability was underway and would only get worse.

    Fast forward to 2011. Has the BRA gotten out of this depression? Hardly. Unemployment has gotten worse, millions of formerly middle class Americans are now the neo-poor, and it is obvious to anyone who isn’t in total denial that the BRA is a Third World basketcase on so many levels. This is a very sick patient, but the patient is going to get a whole lot sicker. The misery will only intensify, and life in the BRA is going to be absolutely hellish for the vast majority of people. Gerald Celente is fond of saying, “When people lose everything and have nothing left to lose, they lose it”—and many Americans are going to lose it big-time. Things are going to get bloody in The Banana Republic of America—Ciudad Juarez bloody, Caracas bloody, Johannesburg bloody, favelas bloody. The violence, the hardship, the suffering, the misery will be horrific. Desperate people do desperate things, and many people who are desperate will feed themselves with guns, knives and razor blades in this Third World hellhole that used to be the United States. So far, this depression hasn’t been as severe as the Great Depression of the 1930s, but that will change. Ultimately, this depression will turn out to be much worse.

    God help The Banana Republic of America, formerly the USA. As the late Irv Homer (a Libertarian talk show host in Philadelphia) used to say, we’re in a pickle.

    • Ben Dover

      Get a clue. The recession ended in June 2009.

      So it is written, so let it be done.

  • 007

    I must say I am not crying over the poor big banks. The market can’t go and they can’t make any money trading. Now they are just short selling each other.

    Kind of poetic justice. It’s like a bunch of thugs sitting around a card table trying to cheat each other at poker. But the chips keep disappearing off the table.

  • Andrew Bulles

    Inflation is here… everyday a little more. Today, I did some grocery shopping… didn’t need Mayonaise but I DID NOTICE THE PRICE… $5.79 for a medium size jar!!! 30 oz.? Price of meats… I CAN NO LONGER AFFORD! Even the soda is about 25% higher! Lucky for me… I HAVE STORED alot of food. Lucky for me… I HAVE AMMUNITION — LOTS! Lucky for me… I have gold and silver!!! What have you done to prepare for the coming economic chaos, CONVULSION & COLLAPSE?

  • Steve

    There will be no QE4. In fact, a week or two after QE3 starts it’s all over. China will dump all their US treasuries and buy GOLD!


    The ability for America and the 50 states to create its own credit has largely been lost to private bankers. The lion’s share of new credit creation is done by private banks, so – instead of being able to itself create money without owing interest – the government owes unfathomable trillions in interest to private banks.

    America may have won the Revolutionary War, but it has since lost one of the main things it fought for: the freedom to create its own credit instead of having to beg for credit from private banks at a usurious cost.

    But – whatever one thinks about public banking or paper currencies – one thing should be clear to everyone: the giant banks are rapidly chipping away at the sovereignty of virtually all of the world’s nations.
    Indeed, they are waging warfare against national sovereignty worldwide.

  • Tent city

    The next crash is waiting somewhere around 2012, its gonna be huge, no one will escape.

  • Zombee K

    The Economic collapse is only getting worse.

  • OldPhart

    An author, on another site (that I can’t recall) likened our dubious economy to the old game “Kerplunk”. That game was a cylinder that had a bunch of sticks through it, with a pile of marbles stacked on top.

    Removing the sticks was no problem initially, but as the game progressed it became harder and harder to safely remove a stick without causing a massive drop of marbles.

    We’re at the point in our “Kerplunkanomy” that each piece of news, financial reversal and political action not only causes more marbles to drop, but we have very few sticks left, if any, to hold back the final collapse.

    There are quite a few known events coming up that will violently jar our “Kerplunkanomy”.

    China will be opening a silver exchange. This will break the collusion and manipulation between London and the New York Cartel on silver pricing. It will also have an effect on gold. The prices should surge as a result and make the use of paper currency seem ridiculous to even the currently unaware.

    We still have ALL the “Toxic Assets” sitting in ALL the banks that were “TBTF”. Those didn’t go away, they’ve just been sanitized a bit so the toxicity didn’t reek as badly.

    We have another round of SubPrime Interest Resets coming starting NOW. Bringing a new round of “foreclosures”. Plus we have the added bonus of resets with Commercial Real Estate…the malls, shops, restaurants, etc.

    2012 will be moving to five years since the beginning of this depression. That means there will be a pile of five year commercial leases being reexamined.

    Five years also means that commercial financing taken on in the better days of 2006/2007 will be paid off. That means that the those wonderful institutions that used to loan us our money, (before they found out it was quicker, easier and cleaner to simply steal it) will no longer have capital streams coming in. Nor will they be showing revenue from the normal interest income they eaarned.

    As Controller, I worked to pay ours off early. The 100 ready mix trucks purchased in 2006 have been sitting at our various plants. And since they’ve been idled, we haven’t had to pay heavy vehicle use tax, fuel tax, registration, insurance, or inspection fees. Our older vehicles will stay on the road until beyond repair, and we will be able to replace from the pool with basically no new costs.

    That means that state and other agencies will not be seeing increases in fees, taxes or other revenue schemes unless they change the rules again.

    We still have the costs associated with the commodity speculation earlier this year piling into the production systems. Now we will see more costs as the unprecedented flooding, storms, and draught have basically wiped out our mid-west farms. We know, right now, that beef and pork will be significantly higher by the end of the year. We know that cereals, not the kellogg stuff, necessarily…oats, wheat, corn, etc are going to be tight. We know that Russia had their own problems and banned any grain export. We may need to do that, but we KNOW that we will export food to some degree regardless.

    We already know that the effects of the Japanese earthquake back in March will show the full effect on financial reports starting NOW. The JIT (Just-In-Time) inventory/logistics was severed for a period and that will reflect in our few remaining mega-manufacturers.

    We also know, based on personal observation and experience, that our “Kerplunkanomy” is much worse than our ruling elite deign to acknowledge. That unemployment is higher, inflation for day to day items is higher, that there is an air of desperation emanating from more and more of our fellow serfs…and things are rapidly coming to a breaking point.

    And we KNOW that whether the scum-sucking vermin weasels in Congress settle the current “debt crisis” or not, it will ultimately fall on our backs; along with a lash from a whip.

    So we have a lot more sticks that are still to be pulled from our “Kerplunkanomy” in a relatively short time.

    And when the marbles fall, it’s game over.

  • mondobeyondo

    Ah yes, nothing smells better than money. Crisp, brand new Federal Reserve notes. Except perhaps freshly baked bread.

    We’ll all get to enjoy that fragrance more often, as the Fed’s printing presses are getting oiled up for QE3. If Bernanke gives the go-ahead, watch the stock market to zoom upwards (more heroin for the drug-addicted Dow and Nasdaq to shoot up), precious metals to rise, and food and basic supplies to rise.

    Your 401(k) – if it is only based on Treasuries and other U.S. dollar assets – will look as though you’re a brand new millionaire. Yet you will never be so poor in your entire life. A few years ago, there were many billionaires in Zimbabwe who struggled to buy a dozen eggs or a loaf of bread…

    • J

      The Fed doesn’t really “print” money anymore. The theory that the U.S. will hyperinflate due to excessive printing of physical dollar bills is incorrect. The far majority of physical bills printed by the Treasury are replacements for currently circulating bills. It’s 2011 now, the Fed creates money by pressing a few key strokes on a computer, not by “firing up the printing presses”. QE1 and 2 were almost entirely digitally created “money”. It’s not like the Fed delivers cases of Benjamin’s to its bankster friends…

      • J

        I should say though, that hyperinflation due to excessive creation of digital money has never really happened before. There’s no way to tell how the economy will collapse; we are in such a unique economic situation that nobody can make a sound prediction on how the economy will collapse. Even the wonderful author of this blog realizes this; he never talks about how it will collapse, only that a collapse is imminent. This being said, I find it a waste of time and energy trying to “figure out” how the economy will collapse. Heck, there are still people arguing “how” WW1 started. Just like WW1, the economy today is like a Jenga tower. Fundamental weaknesses have developed, and now the whole entire tower could fall from any one of many blocks you could possibly pull from the tower. Whether it’s the PIIGS block, the China hates us block, the U.S. sovereign debt block, or any other of the various blocks: one must be pulled eventually and the whole tower will come crashing down.

  • denny

    Yes, the big change is unfolding. This is not a political issue. It is a survival issue. It is not left vs. right or this nation against that nation. It is a war initiated by the rich against the rest of us. Some of the above comments mentioned how they are being labeled ‘survivalists’ or ‘paranoids’. Do not concern yourself with these responses. I firmly believe almost everyone, yes, everyone knows in their heart that big changes are on the way. You do not have to convince anyone. It is a waste of effort. I firmly believe that people of like minds will inevitably meet AND act accordingly. The time for distractions is over. The old American ‘virtues’ of success, accumulation, constant indulgence and sense gratification, power, pride and boastfulness, among others, are, indeed, inapplicable. The virtues of compassion, generosity, humility, diligence, fortitude, honesty (particularly with oneself) and love will be what we need although we haven’t been practicing them on a regular basis for a long time now. Mastering others is strength. Mastering oneself is true power. Turn off your tv’s. Speak with your neighbors. Buy local if possible. Ignore corporate America – The only thing they truly pay attention to is the bottom line – once that is affected, they will be more attentive to methods involved in implementing a more just and equitable perspective ie – no more Fukushimas, Gulf disasters and Wall Street and bank thefts of our collective futures and start thinking ‘smaller’, much smaller, simpler. Although our national psychology has devolved to the level where most of us believe we are incapable of affecting events (This illness is encouraged by those in power); we are, ultimately and immediately, masters of our own destiny and we do not realize this – yet. We have been taught to fear not only the mirage of terrorism, but each other as well and as long as we engage in these distractions true power will never be ours. Let go of the illusions of the ‘American Dream’ for it is just that – a dream, a wasteful and destructive one. We are entering a reality which we have never before experienced and if we do not drop our pride, vanity and self-absorption, among other things, we will perish. One cannot say specifically how this will all come about, but I know in my heart that almost all of the ‘ideals’ we believe to be essential and important will break down, become meaningless and ultimately destroy us if we continue giving them power over our lives. Entering a new world is scary and the only way we can do it is together. Isolation means desolation. Together, we are strong, stronger than anyone realizes. It’s inevitable – adapt or die.

    • Zedge Hero

      That was the best cummalative response to sum up my feelings and so many others for so long around here. I copy and pasted it to my email and sent it to all my family. Thanks for a intelligent break down of the break down. Simply amazing, is all can say. Bravo Denny, bravo my good sir!!

    • Jeff

      Denny, your article would serve as an excellent explanation to the reasons for the following statement: We must begin living like the Amish and the Mennonites.

    • Ganimedes

      Congratulations denny. Very well composed article. You articulate words, facts and thoughts. Amazing text !!!

  • HerrLT

    Everyone: I became a man yesterday! I graduated from an extended adolescence and finally grew up by putting someone ahead of me in terms of wants and needs. It was a bitter pill to swallow, but the weight has been lifted off my chest. Let me explain my revelation…

    My spider-sense has been tingling a great deal lately, so much so that I unilaterally decided my wife and I were going to move to South America against her wishes to get away from what is going on around us. The fight or flight mechanism had swing 180 degrees to the flight spectrum. I’m not taking anything off the table, but in terms of survivability it is going to be best to weather the storm as best as possible with a network of like-minded people around you. So I’m “all-in” here stateside. As Michael said and now I feel, I am compelled to stay here for the time being. As much as I want to get away and run from the writing on the wall, I must grow up and support those I love near me. Afterall, these corporeal shells we call bodies are just rented anyway. Mine will take me as long as it needs to on earth and afterwards will be of no concern. Keep preparing for the worst but do not lose site of today. God bless!

    • Michael

      I agree – the best chance any of us will have is to have a strong group of family and/or friends around us.

      The truth is that the entire globe is going to go through a tremendous amount of chaos. There are going to be very few places that are going to be truly “safe”.


    • JR

      South America? Where, exactly?? Perhaps Chile or Colombia, but where else would you go? Collapsed Argentina? Brazil is now run by a former (and probably still) Communist Dilma Russof (sp?); Peru just went with Chavez clone Humala, and Equador is about the same. Don’t even thing about Morales’ Bolivia. And Ortega is back in Nicaragua. People like Bill Bonner and Doug Casey think they’ll be fine in Nicaragua or Argentina. I say, good luck if/when things hit the fan

  • Fonestar

    Got Silver?

  • Mr. G

    You are right, xander cross. The bankers and many of the guilty parties do claim religion. I doubt that they are true believers, though! I am amazed at how many wealthy “Christians” are completely pragmatic. I am an atheist about 1/3 of the time myself, so I am not against it. Makes perfect sense, in many ways. What I suppose I was getting at was pragmatic materialists, rather than atheists. But, there are crooks of all stripes. Mr. G

  • JR


  • JR

    Silver (and gold) is right. These are one of the few things that ***are not someone else’s promise to pay***

  • 007

    I am an attorney practicing bankruptcy and tax law. Not surprisingly, my business has been good. I recently decided to move my office and take advantage of much lower rents. The amount of vacant office and commercial space is amazing. I soon was able to find three times the space for the same rent. The competition for my business was overwhelming. I finally took a lease space from a landlord at a great price. However, my new landlord is struggling with a massive vacancy rate, bankrupt tenants, taxes and debt problems. This is the first time she has experienced problems like this in her life.

    Today I bought some carpet for the new office and went to several huge carpet sellers. I was the only customer in any of these stores. Most of these stores had virtually no carpet inventory. They could not afford to maintain it. It felt like I was in a ghost town. You could smell the desperation of the poor employees of these businesses.

    Through this whole experience, I could not help but feel that I was going in one direction while everyone else was closing up shop and getting the hell out of dodge. There is an eerie and creepy feeling out there like everyone is going into hiding and waiting for an atomic bomb to explode. Nothing is getting better in Memphis.

    I wish this site was wrong but it is not. These critical economic conditions are everywhere. There is no hiding from it.

    • Michael

      Well said 007.




  • Fem


    I realize the need to have a better idea of the overall economic system, so I start with 2 simple questions to the economy experts, or anyone willing to answer:

    1-What defines a financial market?

    2-What portion of the US, or global, economy corresponds to the stock market?

    Maybe that issue has implications on real value type of economy, jobs, income, and what would make a system real and sustainable.

Finca Bayano

Panama Relocation Tours



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