The Beginning Of The End Ad
Gold Buying Guide: Golden Eagle Coins

Recent Posts

The Preppers Blueprint Economic Collapse Blog Get Prepared Now Ad

Enter your email to subscribe to The Economic Collapse Blog:

Delivered by FeedBurner

A Nightmare Scenario

Share on FacebookTweet about this on TwitterPin on PinterestShare on Google+Share on LinkedInShare on StumbleUponEmail this to someone

NightmareMost people have no idea that the U.S. financial system is on the brink of utter disaster.  If interest rates continue to rise rapidly, the U.S. economy is going to be facing an economic crisis far greater than the one that erupted back in 2008.  At this point, the economic paradigm that the Federal Reserve has constructed only works if interest rates remain super low.  If they rise, everything falls apart.  Much higher interest rates would mean crippling interest payments on the national debt, much higher borrowing costs for state and local governments, trillions of dollars of losses for bond investors, another devastating real estate crash and the possibility of a multi-trillion dollar derivatives meltdown.  Everything depends on interest rates staying low.  Unfortunately for the Fed, it only has a certain amount of control over long-term interest rates, and that control appears to be slipping.  The yield on 10 year U.S. Treasuries has soared in recent weeks.  So have mortgage rates.  Fortunately, rates have leveled off for the moment, but if they resume their upward march we could be dealing with a nightmare scenario very, very quickly.

In particular, the yield on 10 year U.S. Treasuries is a very important number to watch.  So much else in our financial system depends on that number as CNN recently explained…

Indeed, since May, just before Bernanke announced a probable end to QE3, the yield on 10-year Treasuries has jumped around almost one percentage point, to 2.6%, wiping out more than two years of interest payments. The markets clearly fear that far higher long-term rates are lurking in the absence of exceptional policies to rein them in.

That’s a crucial issue, because those rates are highly influential in determining the future performance of stocks, bonds, and real estate. Investors grant equities higher multiples when long-term rates are lower; both longer-maturity Treasuries and corporate bonds jump when rates decline; and developers pocket more cash flow from their projects when they borrow cheaply, raising the values of office and apartment buildings. When rates reverse course, so do all of those prices the Fed has been endeavoring to swell as a tonic for the economy.

Even though the yield on 10 year U.S. Treasuries has risen substantially, it is still very low.  It has a lot more room to go up.  In fact, as the chart posted below demonstrates, the yield on 10 year U.S. Treasuries was above 6 percent back in the year 2000…

10 Year Treasury Yield

And the yield on 10 year U.S. Treasuries should rise substantially.  It simply is not rational to lend the U.S. government money at less than 3 percent when the real rate of inflation is about 8 percent, the Federal Reserve is rapidly debasing the currency by wildly printing money and the federal government has been piling up debt as if there is no tomorrow…

National Debt

Anyone that lends the U.S. government money at current rates is being very foolish.  You will end up getting back money that has much less purchasing power than you originally invested.

Why would anyone do that?

But if interest rates rise, the U.S. government could be looking at some very hairy interest payments very rapidly.  For example, if the average rate of interest on U.S. government debt just gets back to 6 percent (and it has been far higher than that in the past), the federal government will be shelling out a trillion dollars a year just in interest on the national debt.

State and local governments all over the nation could also very rapidly be facing a nightmare scenario.

Detroit is already on the verge of formally declaring the largest municipal bankruptcy in the history of the United States, and there are many other state and local governments from coast to coast that are rapidly heading toward financial disaster even though borrowing costs are super low right now.

If interest rates start rising dramatically, it would cause a huge wave of municipal financial disasters, and municipal bond investors would lose massive amounts of money

“Muni bond investors are in for the shock of their lives,” said financial advisor Ric Edelman. “For the past 30 years there hasn’t been interest rate risk.”

That risk can be extreme. A one-point rise in the interest rate could cut 10 percent of the value of a municipal bond with a longer duration, he said.

Many retail buyers, though, are not ready for the change and “when it starts, it will be too late for them to react,” he said, adding that he was encouraging investors to look at their portfolio allocation and make changes to protect themselves from interest rate risks now.

In fact, bond investors of all types could be facing monstrous losses if interest rates go up dramatically.

It is being projected that if U.S. Treasury yields rise by an average of 3 percentage points, it will cause bond investors to lose a trillion dollars.

And already we have started to see a race for the exits in the bond market.  A total of 80 billion dollars was pulled out of bond funds during the month of June alone.  If you want a visual of the flow of money out of the bond market, just check out the chart in this article.

We are witnessing things happen in the financial markets that have not happened in a very, very long time.

And junk bonds will be hit particularly hard.  About a decade ago, the average yield on junk bonds was about twice what it is right now.  When the junk bond crash comes, there is going to be mass carnage on Wall Street.

But of much greater importance to most Americans is what is happening to mortgage rates.  As mortgage rates rise, it becomes much more difficult to sell a house and much more expensive to buy a house.

According to CNBC, there is an increasing amount of concern that the rise in mortgage rates that we are witnessing could throw the real estate market into absolute turmoil…

The housing recovery is in for a major pause due to higher mortgage rates. It is not in the numbers now, and it won’t be for a few months, but it is coming, according to one noted analyst. The market has seen rising rates before, but never so far so fast; there is no precedent for a 45 percent spike in just six weeks. The spike is causing a sense of urgency now, a rush to buy before rates go higher, but that will be short term. Home sales and home prices will both come down if rates don’t return to their lows, and the expectation is that they will not.

We have seen the number of mortgage applications fall for four weeks in a row, and at this point mortgage applications have declined by 28 percent over the past month.

That is an absolutely stunning decline, but it just shows the power of interest rates.

Let’s try to put this into real world terms.

A year ago, the 30 year rate was sitting at 3.66 percent.  The monthly payment on a 30 year, $300,000 mortgage at that rate would be $1374.07.

If the 30 year rate rises to 8 percent, the monthly payment on a 30 year, $300,000 mortgage at that rate would be $2201.29.

Does 8 percent sound crazy to you?

It shouldn’t.  8 percent was considered to be normal back in the year 2000…

30 Year Mortgage Rate

This is what we are talking about when we talk about the “bubbles” that the Federal Reserve has created.  The housing market is now completely and totally dependent on these artificially low mortgage rates.  If rates go back to “normal”, the results would be absolutely devastating.

But of course the biggest problem with rapidly rising interest rates is the potential for a derivatives crisis.

There are several major U.S. banks that have tens of trillions of dollars of exposure to derivatives.  The following is from one of my previous articles entitled “The Coming Derivatives Panic That Will Destroy Global Financial Markets“…

JPMorgan Chase

Total Assets: $1,812,837,000,000 (just over 1.8 trillion dollars)

Total Exposure To Derivatives: $69,238,349,000,000 (more than 69 trillion dollars)


Total Assets: $1,347,841,000,000 (a bit more than 1.3 trillion dollars)

Total Exposure To Derivatives: $52,150,970,000,000 (more than 52 trillion dollars)

Bank Of America

Total Assets: $1,445,093,000,000 (a bit more than 1.4 trillion dollars)

Total Exposure To Derivatives: $44,405,372,000,000 (more than 44 trillion dollars)

Goldman Sachs

Total Assets: $114,693,000,000 (a bit more than 114 billion dollars – yes, you read that correctly)

Total Exposure To Derivatives: $41,580,395,000,000 (more than 41 trillion dollars)

That means that the total exposure that Goldman Sachs has to derivatives contracts is more than 362 times greater than their total assets.

The largest chunk of those derivatives contracts is made up of interest rate derivatives.

I have mentioned this so many times before, but it bears repeating that there are approximately 441 trillion dollars worth of interest rate derivatives sitting out there.

If rapidly rising interest rates suddenly cause trillions of dollars of those bets to start going bad, we could potentially see several of the “too big to fail” banks collapse at the same time.

So what would happen then?

Would the federal government and the Federal Reserve somehow come up with trillions of dollars (or potentially even tens of trillions of dollars) to bail them out?

The Federal Reserve has created a giant mess, and when this current low interest rate bubble ends our financial system is going to slam very violently into a very solid brick wall.

As Graham Summers recently pointed out, entrusting Federal Reserve Chairman Ben Bernanke with control of our financial system is like putting a madman behind the wheel of a speeding vehicle…

Imagine if you were in the car with a driver who was going 85 MPH down a road with a speed limit of 35 MPH (this isn’t a bad metaphor as there is absolutely no evidence that QE creates jobs or GDP growth so there is no reason for the Fed to be doing it in the first place).

The guy is obviously out of control. The dangers of driving this fast are myriad (crashing, running someone over, etc.) while the benefits (you might get where you want to go a little faster assuming you don’t crash) are minimal.

Now imagine that the driver turned to you and said, “I’m thinking about slowing down.” Seems like a great idea doesn’t it? But then a mere two minutes later he says “ we need to continue at 85 MPH for the foreseeable future.”

At this point any sane person would scream, “STOP.” The driver is clearly a madman and shouldn’t be let anywhere near the driver’s seat. Moreover, he’s totally lost all credibility and isn’t to be trusted.

That’s our Fed Chairman.

Sadly, most Americans do not understand any of this.

Most Americans have no idea about the immense economic pain that is going to hit us when interest rates go back to normal levels.

All of this could have been avoided, but instead the American people let the central planners over at the Federal Reserve run wild.

When the bubble finally bursts, the official unemployment rate is going to rocket well up into the double digits, millions of families will lose their homes and America will find itself in the middle of the worst economic crisis in modern U.S. history.

Please share this article with as many people as you can.  We need to help people understand what is coming so that they will not be blindsided by it.

  • James

    Good article I believe that the collapse is speeding up. I read this and some other sites everyday. Interest rates have to rise or the dollar will collapse. Ron Paul even pointed this out to Ben Bernanke when he was a congressman. The collapse is going to happen America is probably one of the worst places to be for the collapse.

    • AS55423

      Yeah, next stop prison style riots.

  • MichaelfromTheEconomicCollapse

    To a lot of people interest rates are boring, but they are going to play such a key role in what is coming.

    I hope that we can get people to understand how close to utter disaster we really are.


    • Rodster

      Michael, what’s the difference between the $441T derivatives bubble and the $1.6 Quadrillion exposure bubble. I always get the two confused.

      • MichaelfromTheEconomicCollapse

        The 441 trillion dollars is just interest rate derivatives.

        The other number is for the total mountain of derivatives.

        There are many other types of derivatives than just interest rate derivatives.


      • Aaron

        I wish someone could explain this derivatives deal. I mean, 441 tril? That money never existed, banks made it up to bet on rates in their own private casinos. If they lose money that never existed to begin with what is the difference? I really want to know!

        • Mondobeyondo

          The banks made it up, but the people still have to pay for it. That’s how this entire Ponzi scheme of a financial system (fractional reserve banking) is rigged!!

          • Brett McQuigg

            Don’t forget. The Fed creates the money, the banks gamble it and keep the profits, and we pay if their bets are bad. And that is how you know that we are no longer a free people but living in a Cabal, built on a Ponzi, and run by government Mafioso s.

        • Techman

          Its like taking insurance on a Million Dollar home that is only worth $100,000. Then you bet on it burning down.

        • Douglas M. Green

          It isn’t even money bet. It is the FACE value of bonds. The bet is the difference between fixed and floating rates on that face value, and that difference is the gain or loss. It is still in the $ trillions and would easily crash the entire system, but far less than $441 trillion in losses. Just an FYI.

        • Gene Baugh BBA

          It’s just like farmers using hedges to protect themselves from unexpected changes in the price of the crop they produce. Banks crops are the loans they make. They make bets both ways, interest rates up and interest rates down, offsetting each other. This is done to protect themselves from changes in rates and to ensure they receive their expected return.

        • Stupid street occupier

          As stupid as I can understand:
          By nature law, if the reasonable rate is 6%, the banks manipulated it to crazy low 1%, all savers lose, only the Elite can benefit from the cheap money, the borrower and renter can benefit little from deceived lower rate but pay more for the irrational high house prices and inflation.
          The bankers bet on 1% rate by derivatives and win, but the rational traders lose, and the justice (6% rate) of all the Mother Nature are punished. Not to mention Climate Changes to the extreme. For any rational investor also, they cut jobs and spending because the risks are high in the Rigged markets. and For the workers and farmers, their Costs to work rise higher, Incomes lower.
          The Elites bet on 1% rate and use 441Tri derivatives to protect their bets, if the rate rise to 2%, they lose and bankrupt, and all tax payers bail them out. But if the rate rise to 6%, the whole Mother Nature Pays with every life of living things.

    • Rick Candler

      Michael, so what do people do to prepare. I am out of debt but not sure
      how much cash to leave in the bank. Should I invest a high percentage of
      my savings into gold and silver? I do have food and a garden for
      canning. I also kill and process my own venison. Keeping very much money
      in the bank is a concern also. What would you suggest?

      • DownWithLibs

        No one really knows what is best. I have been going in circles myself trying to find the “right” direction. For me, I have decided to do a little of everything (this based on past history and recent books and articles about collapses, such as the one in Argentina). I also have “layers” of protection. I start first with immediate needs – food, water, ammo, meds. Once that is in place, then I will turn to “investments” that appear over time to hold value no matter what is going on.

        Basically, we are all in the same boat. Good luck to you.

      • Jackn3

        I believe in the Gs: Guns, Gold, a Garden, a Generator, and Gasoline. But God shouldn’t be left out.

        • GhostSpectre

          Yeah, superstition and paraphrasing a 3000 year old book filled with schizophrenic “visions” is going to really help ppl. ….right

          • ghostbuster


      • MAL3313

        Stockpiling is only a temporary solution. Knowledge is the best investment. Knowing how to garden and preserve is a good start. Knowing what’s edible and what isn’t when you walk through the woods might be more valuable than gold. Knowing how to treat an emergency injury and what available items may be useful for that purpose might save a life. All that gas and gold won’t do much good if you get a bad cut and it becomes infected and you don’t have a clue what to do about it when medical help isn’t available. When you run out of ammunition a gun is just a club. Do you know how to reload? Have you ever learned to bow hunt? It might preserve your ammo if you can take a deer at 30 yards with a bow. Have you obtained any spare parts for your generator? A class in small engine repair might be very useful. Whether you live in a rural area miles from your nearest neighbor or in a Manhatten high rise there are valuable skills that people should know but have lost.

    • MeMadMax

      You know what, it seems like a “feedback loop” has been created. Damned if we do, damned if we don’t. With the only variable that can control and defuse the situation being if the government can cut back spending in a massive way. Otherwise, interest on debt will consume all of the governments’ income on taxes, creating a self-sustaining meltdown so to speak where even if the government cut spending to zero, debt will continue to rise. Are we close to this? It seems like we are, especially if rising interest rates are more critical now than before.

      • Douglas M. Green

        It will take a while for debts to be rolled over and new debt issued to have $1 trillion in debt service for a single year. But the key is that there will be NOTHING done until we are in the midst of a crisis. Only politicians who promise the undeliverable will be elected, and no pain will be taken when it can be delayed and be dealt with by someone else later, even if the delay increases the ultimate pain.

        • MeMadMax

          Well, we are already in the midst of a crisis, that is if you are in the middle class(or are trying aspire to be middle class lol)

    • GOM

      NWO:” Our counter sign is–Force and Make- believe. Only force conquers in political affairs, especially when concealed in the talents essential to statesman. Violence must be principal, and cunning and make-believe the rule for governments. This evil is the one and only means to attain the end, the good. We must not stop at bribery, deceit and treachery when they should serve as an attainment to our end. In politics one must know how to seize the property of others without hesitation if by it we secure submission and sovereignty. Our state has the right to replace the horrors of war with less noticeable and more satisfactory sentences of death necessary to maintain the terror which tends to produce blind submission. We must keep to the program of violence and make-believe. It is not so much by the means themselves, as by the doctrine of severity that we will triumph and bring all governments into subjection to our super-government”…The Earl of Gosford, Secretary of State for Foreign Affairs, November 7th, 1957 [House of Lords Speech]

    • cannuck21

      Excellent and timely article. The ‘recovery in the housing market’ does not bear examination. The number of first time mortgage application is at an all time low and we see that the purchases of homes is concentrated in Wall Street investment firms.
      Reduce your debt people; pay off your credit cards EVERY month (i.e. do not revolve); reduce your expectations – do you really need that plasma TV. Learn how to prep and pray for guidance.

      • Agree with all your recommendations, with the possible exception of credit card debt. Why? When the masses begin to default on their debts and bankruptcy courts are compiling waiting lists, your credit card debt will be very low on the list of priorities. That, plus the reality of so many people living in this manner with practically no consequences from a bankruptcy, it is hard to live a frugal life when the rest of the world isn’t.

        • cannuck21

          Thanks for your comment. My point regarding credit card debt is that you pay (depending on the specific card issued) in the region of 19.8% – 26.2% APR on these cards. I don’t believe that what other people do is relevant – it is what you and your family do that matters. You can obtain a personal loan for far less if you have a family emergency. It is sad to see societies (Western & newly wealthy Asian) focusing so much on material goods – and still not finding happiness. Congrats for never carrying a Credit Card balance!

          • Again, I’m not advocating for that position, but I did bankruptcy law for a short period. I was stunned by the attitude of a majority of my clients, most of whom actually told me what they were planning to buy as soon as the filing was done. And not to dispute you, but I was told repeatedly by these same clients about how many of their friends were doing the same thing – spending on toys, going bankrupt, and planning the next purchase. It has an effect.

    • abby725

      just as Joel responded I’m stunned that you can make $9848 in 4 weeks on the computer. have you read this page w­w­w.K­E­P­2.c­o­m

  • Guest

    I expect more doublespeak from Bernanke tomorrow and Thursday as he appears before both houses of Congress for his semi-annual testimony. This silly game of “we will taper” one day and “we will continue bond purchases” the next can only go on for so long before the whole thing blows up in his face.

    And for those who hold PMs, don’t be surprised if the bullion banks use Bernanke’s speech as cover for another smash. But don’t worry. The PMs will inevitably break free from this bankster stranglehold.

    • Guest

      Told ya so.

      • Douglas M. Green

        Yes, you did. Good call! Funny how price declines in PMs coincides with language that should make them rise.

  • jokyjo

    Thanks for all the articles you have posted Michael.

    • MichaelfromTheEconomicCollapse

      You are welcome. 🙂


  • markthetruth

    If he gets Pulled over for speeding doing 85 in a 35 would result in Suspension of license and fines and surcharges galore and possible Jail time.

    Pull him over already and throw his butt in Jail.

    the end,,,

  • K

    Michael except for the rich, we are all in the same boat. We see we are headed towards the rocks, and so do a few others. But 80% of the population divides into two camps. The camp that keeps their eyes tightly closed, and refuses to see the rocks. And the camp that can see the rocks, but tells everyone to calm down. They tell you to relax, because the rocks are not real. I can not help but wonder, how long can any society last? When 80% of the population is out of touch with reality.

    • kathy k

      Not only is the 80% out of touch K but yhe MSM just keeps feeding them more & more lies. MSNBC has an article about the sluggish economy & guess what they say its not the Federal Reserves fault go figure. Last night on Fox News Bill O’Rielly hammered MSM for constantly lying to the people; But sometimes I think peope like the lies better than dealing with the truth.

      • K

        kathy k that is the saddest part of all. You are correct a good many prefer the lies.

      • MeMadMax

        Well, look at the way we have been raising our kids for the past few decades: “every” kid is a winner. No father, Barney took his place. Education system teaches NO CRITICAL THINKING skills whatsoever, creating droids that are lax to ask questions…

        • DownWithLibs

          Don’t forget the meds for boys to make them sit quietly in their chairs and listen to the teacher (or not play cowboys and indians at recess because it glorifies guns!). No one really knows how medicating our kids in this way will affect their mental development. That may be were all of these “zombies” will come from.

      • Gay Veteran

        almost all the media (including Fox) is controlled by 6 corporations

        • letfreedomringrh

          And all 6 CEO’s are card-carrying members of the Council on Foreign Relations (CFR)

      • letfreedomringrh

        When I watch the different cable and broadcast news networks (to keep track of their lies and to track their propaganda agenda) they all individually claim that all the other MSM-Networks are the lying MSM.

        Conversely, all the MSM networks individually claim that they are not the lying MSM and criticize all the other networks calling the other networks the lying MSM and identifying their own network as the alternative truth-telling media.

        This delusion is then sold to the comatose public, who, depending on their party affiliation, believe their favorite MSM-network is not associated with the rest of the lying MSM.

        This is one of the biggest lies being told by the MSM as a whole, to the dumb-downed populace who are simply too ignorant to catch-on to this delusion and are unable or unwilling to do their own fact-checking research, The truth is, all the cable and broadcast networks are the lying MSM i.e. the propaganda arm of the infiltrated and hijacked U.S. government.

        The truth of what is important is only found at the independent, self-supported or citizen-supported or fan supported internet alternative-media websites that have no major financial support outside of their advertisers or their fan-support, leaving their independence and the control of their content intact and beholden to nothing but the truth. The veracity and credibility of all alt-news sites must still be verified by one’s own independent research.

        If one is looking for the truth of a matter it will not be found on any MSM-network. Do your own research to find the truth to your own satisfaction. NEVER TRUST THE MSM-NETWORKS.

        I don’t care how much one might want to believe that their favorite MSM talking-head is telling the truth. 99% of MSM personalities and their networks are telling government approved lies.

    • “V”

      Camp #1 Listens to Obama, Reid, Pelosi etc.
      Camp#2 Listens to Boehner, Mcconnell, Limbaugh etc.
      Camp #3 searches for the answers and not what Camp #1 & #2 (or their proaganda machines – Msnbc/CNN) tells us. We must spread the word for people to look far beyond what camp #1 & #2 tells them.

      • Gay Veteran

        totally agree

      • GSOB

        And have you heard the Word?

        It’s soul salvation

    • Joseph Lizak

      You’ve got that right, that 80% of people are out of touch with reality. For example if I were to go to my co-workers and ask 10 of them what a derivative is only one or maybe two could tell me. I sometime ask co-workers what their mortgage payment is (just curious) and how much interest are they paying. Do you know what they tell me? They say “I don’t know, the bank handles all that. They even include my property taxes on the monthly bill”. So for most people all they care about is the monthly bill and have no idea about increasing interest rates (if they have an ARM) or perhaps a balloon payment at the end that nobody can afford, then they take your house.

  • markthetruth

    If Walmart was to raise their prices that matched other stores, they would lose all their customers as there’s no incentive to go buy garbage when they can get quality at the other stores.

    the end…

    • Mondobeyondo

      But Walmart DOESN’T raise their prices. That’s why they’re #1. Bottom line – People care more about low prices than quality, and the Walmart head honchos know it.

      • Jack Frost

        There was a grocery store on hte outskirts of a small town looking to incorporate. A nearby small town reached out and annexed the small grocery store just as the other city finished incorporation. The citizens of hte second town were outraged because the sales taxes and business taxes would support another town’s school system. So they refused to shop there, choosing instead to drive to a different location within their city. The grocery store was closed within a year because it was too far from the citizens of “its” city and had no revenue. The same concept would decimate Walmart if all the people who moan and complain shopped elsewhere. They either lack the fortitude to carry out their stated convictions or they are a small minority in hte market place.

    • piccadillybabe

      I can’t afford to shop for better quality and really who can without going into debt so Walmart is my store of choice. Actually, their quality has gotten a little better than it was a few years ago.

      • jaxon64

        I was raised with the exact opposite thinking–you can’t afford to buy cheap.
        Spend the extra money for a sofa with a real wood frame and nails with dowels instead of a press board or microparticle fabricated fake wood furniture. One of them you’ll replace 4 times in 20 years ( or live with a broken/saggy sofa) the other one will last until you give it to your kids to re-upholster……same with tools, appliances etc etc..

        • markthetruth

          I agree with that too. But like you said this has become a buy and throw away Society . No more minor repairs. Just more garbage Land dumps and ocean dumps. Screw the land and water.

          the end…

      • Jack Frost

        And since almost nothing is actually made in America anymore, where do the higher priced stores get their merchandize? The very same suppliers with a much higher mark up because they lack the economy of scale that Walmart enjoys. Mom and pop stores buy a 1,000 units, Walmart buys a million units and gets lower prices allowing them to still make a profit and sell below others.

        • piccadillybabe

          You are right. The same thing
          at Macy’s that you find at Walmart only cheaper at Walmart.

  • Jason

    Great piece Michael, I enjoy your site immensely.

    • MichaelfromTheEconomicCollapse

      It is always encouraging to hear that people enjoy the hard work that I put into all of this. 🙂


      • Marc

        There are maybe thousands like myself who check your site daily but never post. Keep up the outstanding work, Michael!

      • Catalin

        Not daily here, but weekly at least, when I’m not away or caught into something. It will be a great thing if you could write an article in which you shine more light on the derivatives, interest rates, bond yields, stocks and all these strange terms, with more details and complexity, but still maintaining readability and using everyday life examples; that’s what I noticed works with complicated matters. Jesus talked in parables, they didn’t get it even then but that’s another story. I am not from the USA and I would like to understand more of what makes the world’s former greatest country tick and I don’t want to sift through all the garbage out there because the smell is distracting; I think you know where to look and how to piece it together. This will help in understanding local and global economics better, in my opinion, and see where the head is and how the tentacles move. I understood from one of your articles that the BIS is the most influential bank but from there down it slowly spirals out of control and understanding when I hit terms like those mentioned above. I have the pages, but I don’t know in which order to put them and how to bind the book. If there is such an article out there, I would like to know the link to it.

        I am sorry for all the people out there who are living in the USA. The thing is that it’s the backbone of the world and they’re going to break it and while the world is busy picking the pieces, the USA will burn hotter than all. As it raised, so shall it fall: loud. I hope I am wrong, but history shows how violently empires fell when they prospered and turned vile as an unfortunate consequence of human nature.

        God bless you and your family!

  • El Pollo de Oro

    “The Fed knows that the U.S. economy is not recovering. It simply is being kept from collapse by artificially low interest rates and quantitative easing. As that support goes, the economy will implode.”—Peter Schiff

    “In America, the problem is that interest rates are too low. They have to go up. We can’t have an economy with interest rates at zero. If the Fed lets interest rates go up, we have to realize that we will have a deeper recession. We have to realize that banks are going to fail.”—Peter Schiff

    “They’re robbing everybody’s savings by keeping these interest rates at historic lows. There’s no savings in this country anymore, and they’re
    forcing you to play their game in the stock market and equity market.” —Gerald Celente

  • Sack man

    While I may have more faith than you. Still enjoy the site. Articles. And comments.

    • juskinruck00

      Faith is paying your bills? hmmm

  • jsmith

    Are any of those brainy wizards at Goldman Sachs worried?

    • Mondobeyondo

      Nope. They could care less as long as the Dow Jones keeps rising.

  • Dave Webb

    Study Houston, Texas in the late 80s. Because that is what I expect to happen soon.
    The banks went broke. The people had loads of money in the banks. The banks actually foreclosed on people with money in the bank! They could not access their money in time to keep their own homes.
    The insurance on banks is not capable of handling a massive bankrupt system. It will take anywhere from 9 months to five years to recover the money lost in a bank failure.
    By then the money will have lost a lot of its value.
    Picture this. Direct Deposit on wages into banks. Forced by the U.S. Government. Direct Deposit on all pensions and Social Security. The banks go broke. Suddenly all that money is not available to the people on pensions. Many of which live check to check. Not that it would matter, because their savings is unavailable also.
    Direct Deposit means the money is lost if the banks fail. This is because of an executive order in the case of Social Security.
    Part of the problem is unemployment levels way above normal.
    Part of the problem is no raises in a depressed economy and people without negotiating ability.
    Part of the problem is no raises for 3 years under a democratic administration. Then a token raise in an election year.
    This is the ground level problems. Not the problem with fancy manipulation of banks.
    The immediate effect is people do not have the discretionary income to keep the retail market going.

    I suggest that a lot of retail business will be filing chapter 11 this year. Discretionary income is down, unemployment is up, and people are scared. When the credit cards are maxed out it will all come to a head.
    By what you are saying about derivatives, The entire stock market could crash down to between 5 and 7. That would be the straw that breaks everything.

  • Mondobeyondo

    How bad is it?

    Imagine your worst nightmare. Now, imagine something worse than that. You’re getting close, but I really believe things are going to be much worse

    This country passed the point of no return long ago. If we really want to – if we have the collective will to do so – we CAN turn back. Alas, we don’t. Our leadership shows no such will. Instead, they are actually accelerating the destructive process! Imagine that!

    And the citizens? There was a glimmer of hope with the “Occupy (fill in the blank)” protests in 2011. That faded. So – now what?

    • Mudpie

      Federalism. But the USA will not let that happen. Faith, friends, and family. But the savage irony is that we have given up those old values which really ARE enduring. The older I get, the more wise those values seem. And they are. When there is no money left, lifestyles are going, people will be living as in the Depression (but this time add millions of heavily armed gangbangers roaming the nation with the govt. protecting their “rights”).

      Some folks were happy in the Depression, but mostly due to strong family ties and love and traditions that got them through.

      Today we place faith in the God of Money and Political Correctness.

      Our will to survive will be tested….

    • Jack Frost

      People tear stuff up and set fires when their sports team win some mythical title. Imagine no more handouts…frightening!

  • Mondobeyondo

    What’s the prime lending rate these days?
    I haven’t kept up with it lately (got my own personal issues to deal with and stuff such as). The rate’s been hovering around zero percent for the longest time. But let’s throw 1.3 percent as an example. That’s pretty low.

    At 1.3 percent, you can get some smoking deals on mortgage and auto loans and so forth. Even if you don’t smoke. But when you’re down, there’s no where to go but up. Interest rates WILL rise.

    And when that happens–

    Your college student loans will rise. The interest on debt will rise. ALL debt. Your Visa and Mastercard debt. The national debt. (Every dollar bill in your pocket is debt. Do you realize that?)

  • Graham

    These bankers know exactly what they are doing and why they are doing it. If they truly want a “New World Order” run by a [fake] Super Government, they will have to implode the currency, sovereignty religion morals and integrity of [all] Western nations. How well underway is their agenda?

    What role will BRICS play? When you have the big bad West, something proposed from the East may look like a breathe of fresh air and very palatable. I think we may just see an intermediate stage of the same old agenda, but dressed in new clothes.

    People will be in such a dire state by then that most will jump at anything. Don’t think that the “Western Internationalists” won’t have a controlling interest in any new financial system that is ultimately going to be proposed. Are they not proven experts at playing both sides of the same coin for their own ends? The global reliance on China is strangely interesting.

    I believe deception is about to move onto an entirely different level, so be wary of localised distractions. These “people” will not give up until they get what they want and the control may go “far and beyond” what most could comprehend at this moment in time.

    How many “hidden hands” exist and what is their ultimate motive? Why attempt to unify a planet in three major ways? Government, Currency, Religion. Is fragmentation and diversity our problem?

  • chekmate2

    I’m probably older than most who read this post, but I bought my first house in 1985 and had excellent credit. My interest rate was 15.5%. I had an account that paid 14%. Believe it or not, these are not bad times. My father lived during the Great Depression. He was paid $0.25 per day. Things can get much worse and will if we don’t keep this government in check.

    • Steven

      These are not bad times….yet..

      Suppose the socialists have no more money to pay for food stamps and welfare to the unemployed? And jobs are being offshored more than ever while the world population has increased by over 3 billion since the Great Depression.

      The 21st century Great Depression may be worse than the 1930s Depression

  • Ca Chon

    Thanks to Bernanke, I just sold my house in Calif. and bought 3 houses in Vegas..Try to be a landlord..I know it will be some headach, but the houses are no mortgage so I can have plenty of time to select the tenant

  • seth datta

    Its more or less over in more ways than one. Also, Society is already divided and conquered. The question is how to prepare for an economically and socially uncertain future.

  • Jimbo

    I read the UK paper “The Daily Mail” and I am astounded by the level of ignorance of the posters in the financial pages. The Mail had an article yesterday about some financial experts predicting exports and GDP rising 5% in 2015. The comment posters were whoop whooping saying that Britain had turned a corner and things were getting better. Meanwhile, shops are closing, personal bankruptcies are rising and full time jobs are being replaced by part time jobs. The Pound is weak and interest rates are historically low. Inflation is now (officially) 2.9% which is 1% over the Bank of England target. Britain is a net importer of energy and food and the falling pound will increase import costs and raise inflation. The only main contributors to UK GDP growth are the housing and services sectors which have been boosted with cheap, government backed mortgages which have fueled a boost in housing prices. Nothing about the UK economy adds up but still people can’t see it?

    • Graham

      I often visit the UK media forums to check the pulse and some of the knee jerk reaction to what is put on their plate is astounding.

      Are you by any chance from north of the border? Jimbo is a very popular nickname from my neck of the woods.

      • Jimbo

        My parents are Scottish. My Mum calls me “Jimmy”.

  • Ralfine

    Just imagine.
    The price of the product produced is higher than the wage paid for producing that product.

    Now imagine,
    the sum of all prices vs. the sum of all wages paid.

    Who shall buy all those products?

    Is that nightmare enough?

    • Jimbo

      That is how the world FIAT economy works. The shortfall is made up with debt. While we in the West have to work 1 minute to buy enough rice to fill a bowl, others will work a whole day for half a bowl of rice. We live in houses of brick and they live in huts. Meanwhile our countries have been living off trade deficits while they run surpluses. China has a whole load of US,UK and European debt saved up and when it decides to cash in (change the debt for real things like food and tangible assets) we will be well and truly “in the poo”. I say when China decides to convert debt into real things, what I should say is that it is happening now. The Chinese are buying property, companies, gold and resource companies all over the world at alarming rates. They are converting the “bowl of rice” that we never earned (but borrowed) into our future. Our future is to work a full day for half a bowl of rice.

      • Ralfine


  • Rufus T Firefly

    So how did Goldman Sachs get to be so rich…basically 100 times the other banks. Obviously through underhanded and nefarious doings, but what did they do to get 114 billion? Such behavior deserves to be worshipped along with a god who floods the world, killing all but 8 people and a few animals.

    • Jimbo

      I have an apple and you want an apple. I sell you a bit of paper that says you own the apple but I keep the apple for safe keeping. I sell hundreds of pieces of paper all worth one apple (but I still keep the one apple that I really own). I have lots of money and one apple. Because I have flooded the market with “paper” apples, the real apple drops in value. People come back to me and say that they want to cut their losses on the apple before it falls further in value. I “buy” the paper apple back for less than I paid for it. The apple drops in value even more and I buy back even more “paper” apples. I have settled all of my “paper” apple contracts and I have a tidy profit and an apple. Rinse and repeat.

    • messianicdruid

      Knowing when the land { erats} would be flooded {a natural event} and saving eight people is different from flooding the planet with debt and stealing everyone’s birthright.

    • Firefly

      See comment above by GOM…..

  • RarefiedSnotress

    While I’m not a history buff, I would say that if you followed the ruination of great cultures/nations, that many more were destroyed by the devastation of illness that weakened their populace than any financial ruin.Despite economic collapse, Germany goes on,Argentina goes on.etc
    Columbus got here in 1492, 521 years ago, and we consider ourselves a nation as of 237 years ago. But the Inca Empire was in existence from 2500BC to 1572AD.. that’s 4072 years! What brought it down? They believe it was Small Pox brought over by Spaniards.
    H7N9 is on the horizon. It’s more insidiously communicable than many Avian flus and has almost a one -third mortality rate Pray that they find a good vaccine, but before getting complacent, remember.. we still haven’t beaten the common cold w/a vaccine.
    It’s something to put into perspective.


    The Gods of the Copy Book Headings are very angry.

  • edrobar2978

    The “Too Big Too Fail” situation is called “Overleverage”

  • americalsgt

    I believe what you are saying Michael and appreciate what you are doing to keep me (us) informed. Could you explain to me in simple terms why the DOW continues to maintain a 15,000 level? I think it should be 3,000. We are making nothing in this country so what value is their in a company to give it’s stock the value.

    • Tim

      Equity prices have been inflated by Fed money printing. If it weren’t for that, equity prices would be much, much lower. If the Fed lets off the gas, the jig is up.

      • americalsgt

        Thanks. So the 15K figure would be 6 or 7 K in 2005 money?

  • squashpants

    With all due respect, Michael, what goes up, necessarily, can go down, as well. I rather excitedly watched the interest rate on 10 year treasuries climb to about 2.6%, but I have since followed the rate every few days, and it seems to have settled back down into the 2.4-2.5% range. We are breathlessly waiting for something to happen catastrophically in the financial area, but it seems that, in spite of some volatility, the threatening moves end up mitigating. It gives one pause, as if to suggest that things are not as bad as they seem, or, at least, things will not go the way we think they will/should.

  • BlackDog


    I’m afraid what you and many, many other people have failed to see is that our Federal Government has no intention of there being a ‘tomorrow’ for this country. It was not rational for Bernanke to go on a money-printing spree, but he did it. It was not rational for our President to mandate a broken, failed, miserable attempt at universal healthcare, but he did it. It is not rational to lend to the US Government at a rate of 3% when the real rate of inflation is around 8%, but it’s being done. Try to look at the whole scenario as if crooks entered a bank, unnoticed for now, and were not only tapping into the safety deposit boxes, but everything and anything else that isn’t bolted down. They are stealing the office equipment, the cash registers, the filing cabinets, the entire phone system. If the bank folks or the cops or the depositors don’t notice or realize that these crooks are stealing from them, it will be too late to stop them when it finally dawns on them. NOTHING is going to change to help the average citizen. In fact, I’m beginning to wonder if citizenship is all it’s cracked up to be. If they want my land, they put a lien on it, whether or not it’s legal. If they want my house, they simply take it…forclose when they shouldn’t or is illegal — happens ALL THE TIME, Michael. The nightmare scenario you speak of is already here. But we are too big, too spread out, too divided to care.

  • Sev

    I think plenty of people know what’s in store and that the global economy is a giant ponzi. But what are any of us supposed to do about it? What can we do? It’s like a fly facing a behemoth. The system has to just collapse and we’re in for the ride. One cannot “plan” for anything really.

    • Tim

      I think the best thing anyone can do is try to become less dependent on the system. Living completely off the grid, though ideal, is not an easy lifestyle, and it still requires money. You need money to pay the insurance and registration on your automobile. You need money to pay the annual property taxes.

      • themusicgod1

        There are bitcoin companies willing to help you with all of this at this point. You do not need to rely on the US dollar, and if there’s an area which you do, it just means there’s a business opportunity to be the person to be the go between between the bitcoin world the legacy one. If you ‘still need money’ start converting your use of money to bitcoin now, and take as much of your income in it as possible if you suspect the USD is going to devalue.

    • RarefiedSnotress

      I agree. I mean, who thinks their pistol is really protection against a marauding gang? Even a community of closely knit but somewhat distant farmers wouldn’t be able to take that on. And you can’t eat gold. Maybe you can sell it in a time of need at a good price.. maybe not..and maybe it will be confiscated. Wishful planning is nice, but likely only goes so far.
      Policy makers will always favor certain groups and adjust rules/circumstance accordingly.
      Nothing is certain but death and taxes, and as I mention below, illness may become more of a challenge than a monetary crisis.

      • Jack Frost

        Marauding gangs are actually more akin to burglars. They prefer the easier targets over the hardened targets. Like the western where the mob leader says to the marshal,”There are thirty of us and only one of you!”. The marshal replied,”True, have the six men I can kill step to the front and let’s get started.” Funny how it is like belling a cat, everyone agrees it is a great idea, but no one wants to do it. Plus, pistols are for dispatching the survivors or small groups. Mobs or large gangs require either a rifle or shot gun. Then they become the manageable smaller number. Ready is like pregnant- you are or you aren’t.

    • GSOB

      Perhaps we can share each others physical attractions and secrets

      that is,


      our geographical


      Who knows, it could lead to a bug out plans.

      Aurora CO

    • Jack Frost

      Like the man who jumped off the Empire State building. As he passed each floor, people heard him say, “So far, so good!”

  • Trailer Park Investor

    Hope you like living in a cardboard box down by the river, eating rat meat on a stick cooked over an open flame.
    I like my rat well done, Thank You…
    You can thank our banksters and their highly paid Professional Politicians for this predicament.
    Like Iceland we need to jail them all.

  • dmc2

    The only logical solution is to repudiate all debt and start over. This solution is biblical. They call it jubilee where every servant was set at liberty from their masters.

    • GSOB

      Christ is God’s jubilee, for those who believe.

  • Mogombo

    Maybe I am being simplistic but the answer seems obvious. Do away with the Federal Reserve, throw Bernanke and other bankers in jail, declare all derivatives null and void since it isn’t actual money they are gambling with, and the US can then print it’s own money and owe no interest. We all know that won’t happen but what will happen is that Big Ben will just issue more digits onto the Loser Banks’ balance sheets and further debase the currency. Ben’s solution is likely the plan all along and he has done this before hasn’t he? This is how they keep each other fabulously rich at our expense. Don’t fool yourselves into thinking that they are all stressed out about finding solutions. They only thing they think about is can we continue to fool the American people. The answer to that is obvious.

  • Gary

    No one is going to stop what is about to happen or slow it down because it is part of the plan, God’s Plan. It was predicted from the foundations of civilization by God and is clearly in His word. What we can do is NOT be indebted to anyone but God, live by his Spirit and depend on HIS provision when this all goes bust. He is God and He will see us through.

    • Debbie

      See how far you get with the whole God’s plan theory when you don’t have a job an income. I guess we could all just live in the wilderness like the Israelites did and eat berries and bugs.

      God does not do anything on this planet he merely created us and let go. Just the facts. If everyone lived a Godly and just life then living on Earth would be the most awesome and wonderful thing imaginable.

      Unfortunately people do not live a Godly and just life. Even the ones that tell themselves they are. Just a reality of life.

      • GSOB

        The fact is, they did not eat berries an bugs.

        They ate manna mostly, and quail.

        Manna – It’s a perishable, bread like substance that came down out of heaven as God’s provision for His people.

        Jesus says that He is the true bread that comes down from heaven. (True = eternal)

        Unless you eat his flesh and drink his blood, you have not His life in you.

        John the baptist dwelt pretty much alone in the wilderness and ate locusts and honey.

        The common people like yourself and the religious folks thought he was crazy.

        Also, read this,

        Acts 17:24 > 28a

        ‘God that made the world and all things therein, seeing that he is Lord of heaven and earth, dwells not in temples made with hands;

        25 Neither is worshipped with men’s hands, as though he needed any thing, seeing he gives to all life, and breath, and all things;

        26 And has made of one blood all nations of men for to dwell on all the face of the earth, and has determined the times before appointed, and the bounds of their habitation

        27 That they should seek the Lord, if haply they might feel after him, and find him, though he be not far from every one of us:

        28 For in him we live, and move, and have our being; …..’


        • Doc_Glock

          People, if you are trying to preach the “gospel of Jesus Christ”, JUST DO IT!!! Don’t confuse the spiritually undiscerned.

          Jesus IS the “true bread”, the “living water”, the “vine”, the “door”, and the shepherd”…

          But you don’t have to eat His flesh & drink His blood!

          But what you DO NEED TO DO, is profess Him as LORD & GOD, your SAVIOR!

      • Err Amerika

        I thought everything was god’s will; all according to his master plan. What happened to that, or are you interpreting, reinterpreting, triple reinterpeting, or something else?

        • Doc_Glock

          Hmmm, yeah, that elusive “God’s will”. Everyone’s looking for it, blaming things on it, etc….

          You go FIND it, for YOU. I’ve already found it.

          “God hath chosen the foolish things of the world to confound the wise.”

          • Err Amerika

            More mindlessness blah blah blah ..,

          • Err Amerika

            I’ll bet the same sounding psycho-babble is happening right now in any insane asylum.
            Happy for you that you find comfort swimming in the sea of lunacy.
            I wish I could comfort myself in such delusion, but I just cannot turn my back upon reality. Life’s just too freak’n short!

      • Louise in MO


        Are you, personally, living a just and Godly life?? In the end that’s all that matters! You and God! It’s personal!

        • Doc_Glock

          Uh Louise, I’m sorry, but I must correct you here, before you put out false teaching.

          NONE OF US are just or Godly, and that’s NOT what matters. It’s WHAT JESUS DID to save any of us that matters.

          So when you, or anyone stands before God, and He wants to know why you should be considered RIGHTEOUS in His eye….


          (Rom 5:8-9, 10:13, Eph 2:8-9, 1Jn 5:13,21)

    • Err Amerika

      Hey, my friend’s son was still-born the other day. I guess the boy was to grow up and do some really terrible things or something. It must be all part of God’s plan, must be!

  • Patrick

    I read your articles everyday keep up the great work. I finally got my neighbors to see how dangerous the economy really is. We all started to plan for the worst and pray for the best. Thank you Michael and God bless you and your family thank you

    • Mondobeyondo

      It’s worse than you and everyone else, thinks it is.

  • Raddy

    I read all the comments and see not one about the fact that it is all Spiritually driven.
    The “West” must fall for the Antichrist to be revealed.
    Read the Bible, understand Hitler was a type of the Antichrist. People must be desperate for the man of perdition to be able to come on the world stage.
    All true about the effects in the “natural”, but the drivers are spiritual.

    • Mondobeyondo

      It is spiritually driven. The Bible does not lie. It is God’s written Word. Jesus was the Word made flesh (John 1:1)

      Does that mean what the Bible says will happen, is going to happen? Uh-huh. Yep.

    • GSOB

      The book of Revelation, first and foremost, was written to give believers hope in the revelation of Jesus Christ.

      It’s not focused on the West and events that unfold there. It is the unveiling of the One who is the Alpha and the Omega, who controls of all history to bring about the transformation of the kingdoms of this world to the Kingdom of God.

      The Kingdom is at hand. Christ’s has poured His spirit on all flesh and the Kingdom of heaven has been spreading through this planet to include people from every tribe, nation and language.

      The Church is the body of Jesus Christ.
      Not a building with a rainbow cross on it.

      We are already in the thousand year kingdom, fore it’s not literally a thousand years. Revelation is a book of signs and symbols.

      The whole is His and He is taking it, though He already took it.

      The New Jerusalem coming down out of heaven as a bride adorned for her husband is a sign. What it depicts is the Spirit coming down from the throne towards the elect to justify, sanctify and redeem them. The church is a living organism, not a building with a cross on it.

      The King and His working through us in expanding the Kingdom citizenry will reign in full as we reign in His life now as a foretaste of the things to come.

      The restoration has already started. We don’t have to wait for Christ for the Kingdom to come. We groan even now, eagerly awaiting with the rest of creation, for the return of Jesus, our glorious Savior, and the revelation of the children of God.

    • Err Amerika

      I think you, and the couple guys after you should be committed.

      • Louise in MO

        Committed exatly where? There will come a time when the ability to rely on the one immutable source of justice and power will be the most important thing you have!

      • Doc_Glock

        Well, there’s an interesting couple verses in Jeremiah, who was the last prophet before God spanked the sinful nation of Israel. God tried to warn them using Jeremiah, but they wouldn’t listen. The times we live currently, are almost an EXACT PARALLEL (Spiritually & morally) to this time.

        “Thus saith the LORD, Let not the wise man glory in his WISDOM, neither let the mighty man glory in his MIGHT, let not the rich man glory in his RICHES:”

        “But let him that glorieth GLORY IN THIS, that he UNDERSTANDETH and KNOWETH ME, that I am the LORD which exercise LOVINGKINDNESS, JUDGEMENT, and RIGHTEOUSNESS, in the earth: for IN THESE THINGS I delight, saith the LORD.”
        Jer 9:23-24

        Do you know & understand God, it would seem not. Funny, it’s those things we cherish the most that God warns us about, and the things HE CHERISHES, we (YOU) don’t even know about.

        Repent (change your mind), ask God to forgive & save you, get right with your fellow man, get right for His return.

  • Patriot Alice

    Bernanke has played the balancing act very very well so far. I hope he stays until we have clear sailling..And………That trial was a total farce from the very beginning…6 white female jury? Why not 6 black male jury? Didn’t want to arrest him at all, only the protests forced the arrest…The procecutor called good witnesses for the defense to be questioned…. Stand your ground was good for Trevor too, who was persued…The punch on the nose, caused the back of his head to hit the concrete (Minor cuts), not the blows that attorney slammed the dummy on the floor…If Trevon, had slammed Zimmeman’s head that hard on the cement his scull would have cracked open…A lot more, and I am not an attorney…

    • Unix

      We can tell you are not an attorney…you have no idea what you are talking about and the facts you present are flawed, starting with Chairsatan (BernanQE)…he is ruining this nation with debt, so is our Govt. as to the Martin thing, there was bodily harm, he was afraid, so he defended his life. Get over yourself and get the facts straight ok?

      • Be Real Please

        Patriot Alice is not very smart that is obvious, and your are right this should not devolve into a Zimmerman discussion, but let’s be real: nobody has a problem with vilifying the young man but what about Zimmerman. A history of violence and vigilantism. Why is it impossible that he basically hunted down the kid, got into a confrontation because of it, and shot him like a little bitch. F*#k that scared sh%!.

    • Louise in MO

      Since when did this article suddenly become a treatise about the Zimmerman trial and verdict?

  • Riggah Mortise

    Most of the planners are lawyers.

    Here is a secret most people don’t know. LAWYERS JUST MAKE UP STUFF.

    Derivatives are just made up stuff. COMPLETELY MADE UP.

    So is interest rates, income tax. All pulled from the sky.

    The Federal Reserve is made up. They pull money from the sky too.

    In short, as Jesus said, lawyers are hypocrites. America and the world has been living the dream, only it is really a nightmare created a 100 years ago with the baloney Federal Reserve and the fake income tax.

    You’ll will wake up pretty soon and realize it wasn’t a dream.

  • SAW

    so when might the crash of our economy occur? Are we talking months, years?

    • Mondobeyondo

      Sometime between July 18th, 2013 and February 6th, 2024.

      (Anyone got a spare crystal ball? This one I’m using is broken.)

  • Mondobeyondo

    Banks punch in some numbers on a keypad, on the 88th floor of some financial center sosmewhere.
    They expended NO effort or energy in doing this.
    Voila! Money is CREATED!

    You work the 9 to 5 deal in an office cubicle. You work hard for your money. You created exactly $0.00. However, you EARNED your paycheck!

    You EARNED your paycheck.
    The Fed didn’t earn a beaver dam thing.

    Are you angry?
    (sure you are. America’s Got Talent, on at 8pm tonight on NBC. yawn, yeah whatever.)

  • JailBanksters

    Depends what is meant by Brink, if you mean close then it’s been close for 5 years and it’s been near Brink for another 5 years. But even being just before the Event Horizon, there is still no way of telling how many orbits are left before it this puppy actually goes over the edge and into the Black Hole. It could be on the Brink for another 5-8 years.

    • Doc_Glock

      but it would seem to be inevitable….

      • JailBanksters

        Every time you go around a Blackhole you are nudged a little bit closer, and takes considerable more effort to move away each pass. No matter how much money Bernanke spends, you can’t build a rocket big enough to escape, it’s physically impossible.
        But I gotta give Bernanke AAA+ Credit for trying the same thing over and over and expecting different results each time though.

  • GSOB

    Interesting concept but it don’t completely settles easy with me,
    there are reminding me of Woodrow Wilson’s administration and JFK.

  • GSOB


    Have you ever heard of interpreting the ‘last days’ to mean the incarnation and eternal salvation of Jesus Christ with the destruction of the old covenant system and the temple in AD 70?

    I believe that is how it was understood by the reader back then.

  • jaded

    Great analogy.

  • Arm up, America. And learn how to use it.

  • Guest


  • Louise in MO

    This is one time when I’m glad that we have little investment dollars so that your figures and predictions don’t send me into a deep depression or thoughts of suicide.

    It has been evident to me that inflation has been upon us for many moons. You make adjustments here and there and you survive reasonbly well.

    I do recognize that those who depend on their investments to safeguard the future for their children’s college education, to maintain their home, and retirement will be effected most.

    I don’t, however, feel any sympathy for those who only want more and more money simply to gain more and more power. Money for money’s sake never made much sense to me.

    Extreme fortune and fame does ntot guarantee good health, a happy family life and freedom from vices. Take Anthony Wiener for example.

    The banksters as you call them are most likely not the happiest people in the world.

  • Catalin Oancea

    Thank you for comparing God’s incredible wisdom with the stupidity of man. This 60 year cycle is what I lacked in explanation in regards to the fantastic law of the Jubilee. In a society where the year of the Jubilee exists, banks would be non-existent. Plus, we find another interesting law:

    “At the end of every seven years thou shalt make a release.

    And this is the manner of the release: Every creditor that lendeth ought unto his neighbour shall release it; he shall not exact it of his neighbour, or of his brother; because it is called the LORD’S release.” – Deuteronomy 15:1-2

    How great is that? People saying the Bible was written by men without the inspiration of God obviously haven’t understood the Jubilee and the Lord’s release and can’t grasp the reality that surrounds them. Banks can’t function if they are forced to erase all debts, that is not a law that could have come from man’s limited understanding, for he is too greedy to consider such a thing.

  • anonymous



    *Do you need a loan to pay off your debt?

    *Do you have bad credit ?

    *Do u you need loan to start doing business? if yes, UNIVERSAL TRUST LOAN INC

    INCORPORATED, are Granting you personal loan, Business loan, mortgage loan,

    Construction loan, Debt loan, Student loan, Auto loan, e.t.c. loan is range

    from $10.000 ”min” to Euro10 million”max”@2% rate if u are interested kindly

    send response to:

    *Full Name:_________



    *loan amount:_________

    *Loan duration:_________


    *Purpose of loan:_________

    *Next of kind :_________

    *Email :_________

    *Awaiting your Response:_______

    best regard


  • Doc_Glock


  • Steven

    Hi, Michael,
    The 4 big too big to fail banks have giant exposure of derivatives-most bet on low interest rate. I am going to ask who are on the opposite betting side on high interest?

    In casino, there will be winner and loser, because they bet against each other. n future, if the biggest banks will be loser, who are going to be winner?



  • John

    Abolish the Fed.

  • Stephen Hinkle

    Where do I think this is going to lead? HYPER-DEFLATION, defaults, break-ups of big banks, redistribution of wealth, and maybe even a debt jubilee. I suspect the wall street bankers will end up being losers for a change. If the real wages keep getting smaller, and this collapse leads to a massive debt default, etc this will eventually cause more people to lose jobs, homes, etc. But if too many lose them and the number on the street rise way too much, people will eventually question the motion of throwing people into the streets an eventually allow people to go back home (it happened in the great depression BTW). With too many homes on the market and not enough people who have the money to buy them, this will cause deflation. Add in environmental resource depletion, and this will reduce values of some homes not next to gardens.

  • steve

    Too bad the “1%” can’t bail us out. I mean seriously those people could never spend all that money before they die.

  • Jesse Ejsmont

    I can’t listen to someone who has something to sell. You are trying to profit from fear. You are selling books and your site is littered with affiliate links.

  • Gerasimos Christoforatos

    Land, food, water and community should be primary concern. Get yourself prepared now so you can be ready prior to the collapse. And very possibly at first some guns and amo. Dependent on where you are you just might have to defend yourself and your family but most importantly, It’s also good to be able to hunt for food.

  • Joseph Lizak

    What a great writer. I love his analogies. What’s really amazing is the example of a house payment going up nearly $1000 per month when interest rates increase from 3.66% to 8%.

  • HowsItWorkingOutForYa

    As there have not been comments lately I am not sure this would be seen BUT. I don’t understand why the Central Banks would not continue printing money, buying the Fed’s debt ad nauseum. If all the CB are doing it then how will the bubble burst (meaning they will never default on their loans and they will always keep interest rates low). It seems the major banks feel this is going to happen as they have all sold these derivatives to the moon.
    Secondly if the bubble does burst who would people lose their homes to if all the banks went bankrupt?

Finca Bayano

Panama Relocation Tours



Facebook Twitter More...