Created Out Of Thin Air – That Is Where The Federal Reserve Got The 1.3 Trillion Dollars That It Bought All Of Those Mortgage Backed Securities With

When the mainstream media told the American people that the Federal Reserve was going to “help” the housing industry by buying up hundreds of billions of dollars worth of toxic mortgage backed securities, very few people probably even stopped to wonder where all of that money was going to come from.  Well, the truth is that it did not come from anywhere.  It was made up out of thin air.  In fact, a total of 1.3 trillion dollars was just “printed into existence” so that the Fed could soak up these problematic securities (and help their buddies down on Wall Street in the process who were desperate to dump them).  During a recent Joint Economic Committee hearing on Capital Hill, U.S. Representative Ron Paul directly confronted Federal Reserve Chairman Ben Bernanke about this 1.3 trillion dollars.  As Ron Paul described how this 1.3 trillion was just created out of thin air, all Bernanke could do was nod his head.  Why?  Because it was the truth.

Of course we all know that the Federal Reserve creates money out of thin air all the time, so that is not new, but what is new is the recklessness and openness with which they are going about doing it.

Need to help your buddies down on Wall Street by buying up a tsunami of bad mortgage securities?

Just zap another trillion dollars into existence!

Need to bail out the mortgage giants Fannie Mae and Freddie Mac?

Just get the magic money printing machine ready!

Wouldn’t it be nice if the rest of us could create money out of thin air?  It would make life so much easier.

A video clip of the exchange between Ron Paul and Bernanke at this hearing is posted below.

The key moment comes when Ron Paul makes this statement….

“Well, where did you get the money? You created this money. So you did monetize debt, and that went into the banking system.”

As you watch this video, you will notice that at that moment Bernanke nods his head up and down repeatedly….

So who does all of this money printing benefit?

Well, it benefits the Federal Reserve and the big financial institutions on Wall Street that have financial ties to the Federal Reserve.

It certainly does not benefit the rest of us.

No, in fact Bernanke says that the rest of us need to get ready to pay higher taxes and have a lower standard of living in order to pay for the big financial mess that our politicians and the Fed have gotten us into.

So while there are lots of smiles going around in Washington D.C. and on Wall Street these days, the same cannot be said for the rest of the good ole U.S.A. as the following video illustrates….

The reality is that the United States is a nation that does not even have control over its own currency.  If the United States government wants more money, it has to go ask the Federal Reserve to create it.  Unfortunately, the Federal Reserve does not also create the interest that will ultimately be paid on that new money that is being created.  So where will the money come from to pay the interest?  Well, by creating even more money (debt) in the future.  It sounds like insanity, but that is the U.S. financial system.  It is a perpetual debt machine that was created to have an ever expanding national debt that is mathematically impossible to pay off.

Just because the folks down on Wall Street do not dress up in gang colors or try to sell drugs to our children does not mean that they are not corrupt or that they are not criminals.  In fact, the truth is that the corruption in our financial system is hitting unprecedented levels.

But most Americans have no idea what in the world is going on in the financial system.  All most of them know is that things are getting bad and they want somebody to “fix” the problems.

Unfortunately, the folks that the American people are expecting to “fix” things are the very same ones who got us into this mess in the first place.

“Most Americans have no real understanding of the operation of the international money lenders. The accounts of the Federal Reserve System have never been audited. It operates outside the control of Congress and manipulates the credit of the United States.”
-Senator Barry Goldwater

“A great industrial nation is controlled by it’s system of credit. Our system of credit is concentrated in the hands of a few men. We have come to be one of the worst ruled, one of the most completely controlled and dominated governments in the world–no longer a government of free opinion, no longer a government by conviction and vote of the majority, but a government by the opinion and duress of small groups of dominant men.”
-President Woodrow Wilson

“The real truth of the matter is, as you and I know, that a financial element in the large centers has owned the government of the U.S. since the days of Andrew Jackson.”
-Franklin Delano Roosevelt

“The money powers prey upon the nation in times of peace and conspire against it in times of adversity. It is more despotic than a monarchy, more insolent than autocracy, and more selfish than bureaucracy. It denounces as public enemies all who question its methods or throw light upon its crimes. I have two great enemies, the Southern Army in front of me and the bankers in the rear. Of the two, the one at my rear is my greatest foe.”
-Abraham Lincoln

“Give me control of a nation’s money and I care not who makes it’s laws”
-Mayer Amschel Bauer Rothschild

Revealed!

Why Do So Many Bad Things Keep Happening To The United States?

At a time when the American economy is already reeling like a drunken sailor, the United States is being hit by what seems like an endless parade of horrible disasters that threaten to push the fragile financial system over the edge.  The massive oil spill in the Gulf of Mexico that is now destroying not only the the entire economy of the Gulf Coast but also the entire way of life for hundreds of thousands of people is getting all the headlines right now, but it is far from the only major crisis that has hit the United States recently.  The old saying, “when it rains it pours”, is certainly applicable to the United States right now.  Already faced with some of the biggest economic problems in a generation, America is also being forced to deal with horrifying natural disasters, rapidly growing environmental nightmares and agricultural problems that could end up being absolutely unprecedented.  So why do so many bad things keep happening to the United States?  Does there come a point when the economic damage from all of these disasters just becomes too much?  After all, how many body blows can the “biggest economy in the world” take and still remain standing?  

Consider just a few of the major disasters that the U.S. is having to deal with….

*The Gulf Of Mexico Oil Spill

Industry experts are now saying that the oil spill in the Gulf of Mexico could be increasing at a rate of 25,000 barrels a day – five times the U.S. government’s current estimate.  In fact, Barack Obama is calling the massive oil spill in the Gulf of Mexico a potentially unprecedented environmental disaster.

So how much is this disaster going to cost?

Well, estimates vary at this point, but it is being reported that some analysts are already projecting that the costs related to the oil spill drifting toward Louisiana from a well operated by BP in the Gulf of Mexico could exceed 14 billion dollars.

The cost to the fishing industry in Louisiana alone could top 3 billion dollars, and it is being projected that the tourism industry in Florida could lose even more than that. 

This is rapidly shaping up as one of the biggest environmental nightmares (perhaps the biggest) that the United States has ever had to face.  In fact, there are some who are saying that this incident has already eclipsed the 1989 Exxon Valdez incident as the worst U.S. oil disaster in history.

Louisiana Governor Bobby Jindal is warning that the oil spill in the Gulf threatens the very way of life of people in his state.  As bad as Hurricane Katrina was, there are those who are already claiming that this disaster will be worse than Hurricane Katrina for the region, because it will literally take years for this mess to be cleaned up.  In fact, there is a very real possibility that the fishing industry may be crippled for generations by this disaster.

*The Disappearance Of The Honeybees

For the fourth year in a row in the United States, more than a third of all bee colonies have failed to survive the winter.

To be more precise, according to the annual survey by the Apiary Inspectors of America and the U.S. government’s Agricultural Research Service, the number of managed honeybee colonies in the United States fell by 33.8% last winter.

Needless to say, this is not a good trend.

In fact, it could quickly turn into an unmitigated disaster as it is estimated that a third of all that we eat depends upon honeybee pollination.

Are you starting to get the picture?

Most flowering plants require insects for pollination.  The most effective insect for pollination is the honeybee.

Without honeybees, we are going to be in a world of hurt.

According to WorldNetDaily, the following is a list of just some of the crops that depend on honeybees: almonds, apples, apricots, avocados, blueberries, boysenberries, cherries, citrus fruits, cranberries, grapes, kiwi, loganberries, macadamia nuts, nectarines, olives, peaches, pears, plums, raspberries, strawberries, asparagus, broccoli, carrots, cauliflower, celery, cucumbers, cantaloupe, honeydew, onions, pumpkins, squash, watermelon, alfalfa hay and seed, cotton lint, cotton seed, legume seed, peanuts, rapeseed, soybeans, sugar beets and sunflowers.

In fact, Ohio State University’s honeybee specialist, James Tew, recently told the following to the Dayton Daily News….

“The average person should care. Bees of all species are fundamental to the operation of our ecosystem.”

So what happens if they all die off?

You don’t even want to think about that.

But certainly our scientists can find a solution, right?

Well, the World Organization for Animal Health announced on Wednesday that the huge die off of bees worldwide is not due to any one single factor.

Some of the factors for the honeybee deaths the World Organization for Animal Health included in its report include parasites, viral and bacterial infections, pesticides, and poor nutrition.

Other researchers claim that genetically modified crops and cell phone transmissions are also playing a role in the disappearance of the honeybees.

But the truth is that a “solution” seems to be very far away right now and we are running out of time.

*The Deadly Tornadoes Which Have Ravaged The Southeast

Last Sunday saw an unprecedented outbreak of tornadoes across the southeast United States.  Officials said 61 tornadoes erupted as a massive storm marched across states such as Mississippi, Florida and South Carolina. 

Winds inside some of the tornadoes were clocked as high as 160 mph, and one of the tornadoes had a base one and a half miles wide.

The tornadoes killed at least 12 people, and it is estimated that the damage that they caused could reach into the billions of dollars.

*The Drying Up Of The Ogallala Aquifer

Most Americans have never heard of the Ogallala Aquifer, but it is absolutely critical to food production in many areas of the United States.

The water from this massive underground lake is used to irrigate much of America’s Great Plains.  But it is being drained at a rate of approximately 800 gallons per minute and it is starting to dry up.  

So why is that a bad thing?

Well, the Ogallala Aquifer is a gigantic underground lake that stretches from southern South Dakota all the way through northern Texas, covering approximately 174,000 square miles.

If it gets depleted, the era of “pivot irrigation” in the region will be over.  That would mean that the Great Plains could quickly turn into the Great American Desert. 

America could very well see a return to the Dust Bowl days of the 1930s.

Are you prepared for that?

Even if agricultural production continues to grow normally, scientists are telling us that the world is heading for a massive global food shortage.  So what happens if our food production does not increase or is even reduced?

Sadly, the United States has only enough grain stored up to give about a half a loaf of bread to every man, woman and child in the United States.

How long do you think that is going to last in the event of a major emergency?

The truth is that “the good times” we have all grown up with are not going to last forever.  The United States is in big trouble economically, and all of these natural disasters and environmental problems are not helping things one bit. 

We are not entitled to endless wealth and prosperity just because we are Americans.  In fact, we have recklessly squandered the wealth that prior generations have left for us. 

But even as the economy crumbles around them, millions of Americans will remain in denial until the day they have to cook a dinner of “mouse soup” for their starving family.

Why You Should Be VERY CONCERNED About The Financial Crisis In Greece

Up to this point, it seems as though most Americans have not really been too concerned about the financial meltdown that is taking place in Greece.  But they should be.  The truth is that the debt crisis we see playing out in Greece may soon repeat itself in some of the largest nations in the world such as Japan, the U.K. and even the United States.  Once upon a time, this kind of thing only happened in third world nations, but now virtually every nation on earth has a debt problem.  As the saying goes, the borrower is the servant of the lender, and so when a country like Greece gets in way, way too deep financially, it ends up having to give up a portion of its sovereignty to those controlling the purse strings.  In the case of Greece, those controlling the purse strings are the IMF and the EU.  But it just isn’t Greece that is in trouble.  Dozens of nations are in serious financial trouble and are at the mercy of those who can bail them out.  The truth is that global financial institutions like the IMF, the World Bank, the European Central Bank and the Federal Reserve are increasingly gaining power all over the globe as governments around the world continue to accumulate frightening amounts of debt.

This has been quite a week for Greece and for the other nations in Europe teetering on the edge of financial disaster.  Standard & Poor’s reduced Greek debt to “junk” status, and Spain and Portugal’s debts were also downgraded substantially.  These unprecedented steps by Standard & Poor’s have many concerned that this financial “contagion” could start spreading across all of Europe.

We’ll take a look at the “austerity measures” being forced on Greece in a moment, but first it is important to note that financial panic is already spreading to other nations in the region.

In Portugal, the government has announced that additional “austerity measures”, beyond those in the current three year plan, are expected to be implemented.  Perhaps they wouldn’t need to take such drastic steps if they hadn’t spent all of those millions constructing those shiny new soccer stadiums a few years ago.  But in any event, many analysts are now forecasting that Portugal will be the next domino to fall.

Officials in Spain are expected to announce this week that unemployment has hit 20%.  But of course any nation that implements a hardcore “cap and trade” law like the one in Spain should expect unemployment to soar into the stratosphere.  So they are just reaping what they have sown, but the fallout could end up being very painful.  Spain’s economy is approximately five times larger than Greece’s so if Spain ends up defaulting it will create a financial nightmare for all of Europe.

There are now rumors that even Italy and Ireland are in a massive amount of trouble financially.

So will the EU and the IMF end up having to bail all of them out?

Well, for now Greece is first in line.

European officials said on Friday that the Greek government, facing a rapidly deteriorating financial situation, is close to completing negotiations for assistance from the International Monetary Fund.

So Greece is going to get the money that it needs – but it comes with strings.

Greece must surrender some of its fiscal sovereignty and adopt a three year program of severe spending cuts and higher taxes.

In fact, one major Greek newspaper says that wage and job cuts for public workers will also be ordered alongside the spending cuts and tax increases to get through what they are calling “three hard years”.

You see, the truth is that Greece is a highly socialized nation.  In a population of just over 11 million people, Greece employs more than a million in the public sector.

Just think about that for a moment.

That is huge.

They get paid extremely well, and Greek civil servants also enjoy very generous pension benefits and early retirement.

Needless to say a lot of these Greek civil servants are not happy at all about the changes the IMF is forcing upon them, and they have called a general strike for May 5th.

For his part, the Greek Prime Minister, George Papandreou, is trying to convince the Greek people that these new spending cuts and tax increases are necessary to keep his nation afloat.  According to The Associated Press, Mr. Papandreou recently told the Greek Parliament the following….

“The measures we must take, which are economic measures, are necessary for the protection of our country — for our survival, for our future, so we can stand firmly on our feet.”

There are even fears that this sovereign debt crisis could spell the end for the Euro.  Back on Wednesday, the leaders of the 16 countries currently using the Euro called an emergency meeting to attempt to avert a Euro meltdown triggered by Greece’s financial collapse.

Of course the Euro is not actually going to collapse, but the fact that they all felt the need to get together and talk about this situation is quite telling.

In fact, the language used by some of the top financial authorities in the world when speaking about the Greek debt crisis is quite alarming….

Angel Gurría, head of the Organization for Economic Cooperation and Development:

“This is like Ebola. It’s threatening the stability of the financial system.”

Colin Ellis, economist at Daiwa Capital Markets:

“The time for horse-trading, prevarication and posturing is over. Arguably, the very future of the euro area is now teetering on a knife edge.”

Dominique Strauss-Kahn, head of the International Monetary Fund:

“If we don’t fix it in Greece, it may have a lot of consequences on the EU.”

But for the people of Greece, getting help with their debt means giving up their ability to determine their own affairs.  They have gotten into so much debt that now they are forced to do whatever the IMF and the EU tell them to do.  Of course there are many in Greece who are extremely upset by this as evidenced by the recent riots there….

But this is what happens when a nation allows itself to get into way too much debt.  In fact, this has been done by design in third world nations for decades.  In his extraordinary book, Confessions of an Economic Hitman, John Perkins explained how it was his job to go around the world and get third world governments to accept multibillion-dollar loans that he knew they would never be able to repay.  Of course when the time came and they could not repay the loans, the big global institutions would go in and confiscate natural resources and impose “conditions” and implement “austerity measures” similar to the ones they are currently imposing on Greece.

The alarming thing today is that it just isn’t third world nations where this game is being played anymore.  Now that they have perfected the blueprint, they are trying it out on nations like Greece.

The reality is that this is all part of the push towards globalization.  In fact, Jean-Claude Trichet, the president of the European Central Bank, emphasized the need for global coordination in financial matters during his April 26th address at the Council on Foreign Relations.

“Global coordination” sounds nice, but just like “global governance” and “global cooperation”, it is just another way of saying that we need to transfer more power and more authority to globalist institutions.

You see, whatever problem that pops up (in this instance it is the Greek debt crisis), the solution always seems to be to transfer more power to global institutions.

In fact, as a “solution” to the global financial crisis, the IMF is proposing two new taxes on financial institutions worldwide: a “financial stability contribution” which levies a small charge on financial institution balance sheets, and a “financial activities tax”, which would tax “excess profits” and bonuses.

As the nations of the world continue to get deeper in debt, and as more power and more money is transferred to unelected global institutions, the people of the world may find their lives increasingly being run by heartless bureaucrats on the other side of the globe.

For anyone who loves freedom, that is a very sobering thought.

“Things Are Never Going To Get THAT Bad”

Our recent article, “20 Things You Will Need To Survive When The Economy Collapses And The Next Great Depression Begins“, has drawn some intense criticism from those who believe that the U.S. economy is so strong that it could never completely and totally collapse.  In fact, this blog is being accused of officially going off the deep end.  Why?  It’s not because we are pointing out that the economy is bad.  After all, according to a recent Pew Research national poll, 88 percent of Americans rate national economic conditions as only fair or poor.  No, rather it is because we are projecting the eventual complete and total collapse of the U.S. economy.  There still seems to be a belief among a large number of Americans “that things are never going to get THAT bad”.  But they are going to get that bad.  It’s just that most people do not realize it yet.

But while times are still good (and what we are experiencing now is rip-roaring prosperity compared to what is coming), large numbers of people are going to continue to live in denial.  In fact, those who try to warn people about what is coming are going to be accused of “fear-mongering”.  One recent commenter even accused us of totally going off the deep end like many of the Y2K alarmists did….

—-

“Ok – you’ve officially fallen off the deep end. This blog went from legitimate economic concerns to grand fear mongering. This is the same as Y2K all over again. I have friends who still have bunkers and thousands of dollars of expired canned food and you’re suggesting they go do it again…”

—-

First of all, it was completely and totally obvious that Y2K was going to be a non-event to anyone with a bit of common sense.  There was simply no way that a “computer glitch” that was foreseeable years ahead of time was going to cause the collapse of society.

What is happening with the U.S. economy now is completely different.  We have built an entire economic system on ever-increasing amounts of debt and paper money, and anyone with half a brain should be able to see that such a system is not sustainable in the long-term.  The collapse of the economy is inevitable due to the way that it was constructed.

As for having “thousands of dollars of expired canned food”, that would not be a problem if you rotated the food that you have stored.  You eat the old stuff first and you replace it with new food that you have purchased.

But the commenter above was not the only one to accuse us of trying to scare people….

—-

“How does the economic collapse lead to a complete halt to all economic activity? More people may be poorer, but they will still have some money to motivate others to produce for a market. The natural disaster scenario seems more plausible for this type of warning. More and more foreclosures don’t. This posting is a bit much for me, seems just some much scaremongering.”

—-

The commenter is right about one thing – a few bad economic statistics are not enough to run out and start preparing for the collapse of society.  After all, the American economy has always recovered no matter what happened before.  If we made it through the Great Depression, we can make it through this, right?

Well, the truth is that there are some fundamental differences between what is happening now and what happened during the Great Depression.

During the Great Depression, most Americans were not up to their eyeballs in credit card debt, car payments, student loans and mortgage debt.

During the Great Depression, most Americans either owned their land or had a great deal of equity in their land.  As we wrote about recently, today that is not the case.  Equity as a percentage of home value in the United States has been hitting all-time record lows.

During the Great Depression, most Americans were not dependent on giant corporations to feed and supply us.  Back then, the majority of Americans knew how to live off the land and grew at least some of their own food.  Today that is most definitely not the case.

During the Great Depression, America still had the greatest manufacturing base in the entire world.  Today we have “offshored” our once great manufacturing base, and we have become a fat, spoiled society that consumes everything in sight but manufactures very little.

During the Great Depression, America did not have a colossal trade deficit.  Today we have got the biggest trade deficit in the history of the world.

During the Great Depression, the wealth of Americans was not being sucked dry by dozens of different kinds of taxes.  Today we are being taxed in so many various ways that many Americans actually end up spending over half their incomes just in taxes.

During the Great Depression, the U.S. government had debt, but it was not threatening to collapse the entire global economy.  Today the U.S. government has piled up the biggest mountain of debt in the history of the world.

During the Great Depression, derivatives were not even an issue.  Today, we have created a derivatives bubble that is now well beyond a quadrillion dollars.

Just think about that.

Over 1,000,000,000,000,000 dollars.

Counting at one dollar per second, it would take 32 million years to count to one quadrillion.

In fact, renowned investor Warren Buffett has warned that derivatives are “financial weapons of mass destruction” that could bring down the entire world economic system.

And he is right.

When derivatives collapse, there is not enough money in the world to fix the mess that will be created.  All of the governments in the world working together would not be able to print money fast enough to even make a dent in the colossal wave of red ink that would be created.

The truth is that the U.S. economy (and the world economy for that matter) is teetering on top of a giant pyramid of debt and paper that is on the verge of coming down like a house of cards.

But if you do not want to believe this blog, perhaps you will listen to some of the top financial experts in the world who are also warning that a complete and total economic collapse is coming.

For example, Gerald Celente, the CEO of Trends Research Institute, is forecasting that we are going to see a devastating economic collapse by the year 2012.  It would be easy to dismiss him, except for the fact that he has a sterling track record of forecasts going back 3 decades, and he has appeared on almost all of the major news networks who have no problem relying on him as a source.  What Celente says is on the way for America is absolutely bone chilling….

But if you don’t want to listen to Celente, perhaps you will listen to Peter Schiff, the president of Euro Pacific Capital.  He accurately predicted the recent financial crisis, and he is also forecasting that a depression is on the way.  Schiff is convinced that we need to allow the current “Ponzi economy” to collapse so that something more substantial can arise from the ashes….

Jim Rogers is another financial expert that is forecasting a major economic collapse.  Jim Rogers was a co-founder of the Quantum Fund, and is a college professor, author, economic commentator, and creator of the Rogers International Commodities Index.  He says that civil unrest is on the way and that now is a good time to take up farming if you want to make it through what is coming….

The truth is that the vast majority of Americans have no idea just how vulnerable the U.S. economic system is.  A new Gallup poll has found that 44 percent of Americans believe that they could barely go a month before experiencing severe economic hardship if they lost their jobs.

How long could you go if you suddenly lost your job?

Right now the U.S. economy is being kept afloat by unprecedented U.S. government intervention and spending, but we all know that the U.S. government cannot keep spending money like it is water forever without very serious economic consequences.  To give you an idea of how desperate things have become, just check out the following graphic about the U.S. national debt that was featured in the Chicago Tribune….

Anyone who believes that such a tidal wave of red ink is sustainable please raise your hand.

The truth is that the U.S. economy is caught in a death spiral.

Already there are some areas of the United States that are literally dying.

For those who do not believe this fact, the following is a challenge for you….

Head down to Detroit and buy one of those houses that are on sale for less than a thousand dollars (in fact there have even been reports of some houses selling for a single dollar in Detroit), and try to live there for a month.

You will quickly learn what it is like to live in an area that is literally dying economically.

When people are hungry and they can’t get jobs they get desperate.

So far this year in Detroit, car thefts are up 83%, robberies are up 50%, burglaries are up 20% and property destruction is up 42%.

What is happening in Detroit is a preview of what is soon going to happen all over America.

So doubt it all you want, but all the doubting in the world is not going to stop what is coming.  The U.S. economy is dying so you better start getting ready.

The Prep Room

20 Things You Will Need To Survive When The Economy Collapses And The Next Great Depression Begins

Today, millions of Americans say that they believe that the United States is on the verge of a major economic collapse and will soon be entering another Great Depression.  But only a small percentage of those same people are prepared for that to happen.  The sad truth is that the vast majority of Americans would last little more than a month on what they have stored up in their homes.  Most of us are so used to running out to the supermarket or to Wal-Mart for whatever we need that we never even stop to consider what would happen if suddenly we were not able to do that.  Already the U.S. economy is starting to stumble about like a drunken frat boy.  All it would take for the entire U.S. to resemble New Orleans after Hurricane Katrina would be for a major war, a terror attack, a deadly pandemic or a massive natural disaster to strike at just the right time and push the teetering U.S. economy over the edge.  So just how would you survive if you suddenly could not rely on the huge international corporate giants to feed, clothe and supply you and your family?  Do you have a plan?

Unless you already live in a cave or you are a complete and total mindless follower of the establishment media, you should be able to see very clearly that our society is more vulnerable now than it ever has been.  This year there have been an unprecedented number of large earthquakes around the world and volcanoes all over the globe are awakening.  You can just take a look at what has happened in Haiti and in Iceland to see how devastating a natural disaster can be.  Not only that, but we have a world that is full of lunatics in positions of power, and if one of them decides to set off a nuclear, chemical or biological weapon in a major city it could paralyze an entire region.  War could erupt in the Middle East at literally any moment, and if it does the price of oil will double or triple (at least) and there is the possibility that much of the entire world could be drawn into the conflict.  Scientists tell us that a massive high-altitude EMP (electromagnetic pulse) blast could send large portions of the United States back to the stone age in an instant.  In addition, there is the constant threat that the outbreak of a major viral pandemic (such as what happened with the 1918 Spanish Flu) could kill tens of millions of people around the globe and paralyze the economies of the world. 

But even without all of that, the truth is that the U.S. economy is going to collapse.  So just think of what will happen if one (or more) of those things does happen on top of all the economic problems that we are having.

Are you prepared?  

The following is a list of 20 things you and your family will need to survive when the economy totally collapses and the next Great Depression begins….

#1) Storable Food

Food is going to instantly become one of the most valuable commodities in existence in the event of an economic collapse.  If you do not have food you are not going to survive.  Most American families could not last much longer than a month on what they have in their house right now.  So what about you?  If disaster struck right now, how long could you survive on what you have?  The truth is that we all need to start storing up food.  If you and your family run out of food, you will suddenly find yourselves competing with the hordes of hungry people who are looting the stores and roaming the streets looking for something to eat.

Of course you can grow your own food, but that is going to take time.  So you need to have enough food stored up until the food that you plant has time to grow.  But if you have not stored up any seeds you might as well forget it.  When the economy totally collapses, the remaining seeds will disappear very quickly.  So if you think that you are going to need seeds, now is the time to get them.

#2) Clean Water

Most people can survive for a number of weeks without food, but without water you will die in just a few days.  So where would you get water if the water suddenly stopped flowing out of your taps?  Do you have a plan?  Is there an abundant supply of clean water near your home? Would you be able to boil water if you need to?

Besides storing water and figuring out how you are going to gather water if society breaks down, another thing to consider is water purification tablets.  The water you are able to gather during a time of crisis may not be suitable for drinking.  So you may find that water purification tablets come in very, very handy.

#3) Shelter

You can’t sleep on the streets, can you?  Well, some people will be able to get by living on the streets, but the vast majority of us will need some form of shelter to survive for long.  So what would you do if you and your family lost your home or suddenly were forced from your home?  Where would you go? 

The best thing to do is to come up with several plans.  Do you have relatives that you can bunk with in case of emergency?  Do you own a tent and sleeping bags if you had to rough it?  If one day everything hits the fan and you and your family have to “bug out” somewhere, where would that be?  You need to have a plan.

#4) Warm Clothing

If you plan to survive for long in a nightmare economic situation, you are probably going to need some warm, functional clothing.  If you live in a cold climate, this is going to mean storing up plenty of blankets and cold weather clothes.  If you live in an area where it rains a lot, you will need to be sure to store up some rain gear.  If you think you may have to survive outdoors in an emergency situation, make sure that you and your family have something warm to put on your heads.  Someday after the economy has collapsed and people are scrambling to survive, a lot of folks are going to end up freezing to death.  In fact, in the coldest areas it is actually possible to freeze to death in your own home.  Don’t let that happen to you.

#5) An Axe

Staying along the theme of staying warm, you may want to consider investing in a good axe.  In the event of a major emergency, gathering firewood will be a priority.  Without a good tool to cut the wood with that will be much more difficult.

#6) Lighters Or Matches

You will also want something to start a fire with.  If you can start a fire, you can cook food, you can boil water and you can stay warm.  So in a true emergency situation, how do you plan to start a fire?  By rubbing sticks together?  Now is the time to put away a supply of lighters or matches so that you will be prepared when you really need them.

In addition, you may want to consider storing up a good supply of candles.  Candles come in quite handy whenever the electricity goes out, and in the event of a long-term economic nightmare we will all see why our forefathers relied on candles so much.

#7) Hiking Boots Or Comfortable Shoes

When you ask most people to list things necessary for survival, this is not the first or the second thing that comes to mind.  But having hiking boots or very comfortable and functional shoes will be absolutely critical.  You may very well find yourself in a situation where you and your family must walk everywhere you want to go.  So how far do you think you will get in high heels?  You will want footwear that you would feel comfortable walking in for hours if necessary.  You will also want footwear that will last a long time, because when the economy truly collapses you may not be able to run out to the shoe store and get what you need at that point. 

#8) A Flashlight And/Or Lantern

When the power goes off in your home, what is the first thing that you grab?  Just think about it.  A flashlight or a lantern of course.  In a major emergency, a flashlight or a lantern is going to be a necessity – especially if you need to go anywhere at night. 

Solar powered or “crank style” flashlights or lanterns will probably be best during a long-term emergency.  If you have battery-powered units you will want to begin storing up lots and lots of batteries.   

#9) A Radio

If a major crisis does hit the United States, what will you and your family want?  Among other things, you will all want to know what in the world is going on.  A radio can be an invaluable tool for keeping up with the news. 

Once again, solar powered or “crank style” radios will probably work best for the long term.  A battery-powered until would work as well – but only for as long as your batteries are able to last.

#10) Communication Equipment

When things really hit the fan you are going to want to communicate with your family and friends.  You will also want to be able to contact an ambulance or law enforcement if necessary.  Having an emergency cell phone is great, but it may or may not work during a time of crisis.  The Internet also may or may not be available.  Be sure to have a plan (whether it be high-tech or low-tech) for staying in communication with others during a major emergency.

#11) A Swiss Army Knife

If you have ever owned a Swiss Army knife you probably already know how incredibly handy they can be.  It can be a very valuable and versatile tool.  In a true survival situation, a Swiss Army knife can literally do dozens of different things for you.  Make sure that you have at least one stored up for emergencies.

#12) Personal Hygiene Items 

While these may not be absolute “essentials”, the truth is that life will get very unpleasant very quickly without them.  For example, what would you do without toilet paper?  Just think about it.  Imagine that you just finished your last roll of toilet paper and now you can’t get any more.  What would you do? 

The truth is that soap, toothbrushes, toothpaste, shampoo, toilet paper and other hygiene products are things that we completely take for granted in society today.  So what would happen if we could not go out and buy them any longer?

#13) A First Aid Kit And Other Medical Supplies

One  a more serious note, you may not be able to access a hospital or a doctor during a major crisis.  In your survival supplies, be absolutely certain that you have a good first aid kit and any other medical supplies that you think you may need.

#14) Extra Gasoline

There may come a day when gasoline is rationed or is simply not available at all.  If that happens, how will you get around?  Be certain to have some extra gasoline stored away just in case you find yourself really needing to get somewhere someday.

#15) A Sewing Kit

If you were not able to run out and buy new clothes for you and your family, what would you do?  Well, you would want to repair the clothes that you have and make them last as long as possible.  Without a good sewing kit that will be very difficult to do.

#16) Self-Defense Equipment

Whether it is pepper spray to fend off wild animals or something more “robust” to fend off wild humans, millions of Americans will one day be thankful that they have something to defend themselves with.

#17) A Compass

In the event of a major emergency, you and your family may find yourselves having to be on the move.  If you are in a wilderness area, it will be very hard to tell what direction you are heading without a compass.  It is always a good idea to have at least one compass stored up. 

#18) A Hiking Backpack

If you and your family suddenly have to “bug out”, what will you carry all of your survival supplies in?  Having a good hiking backpack or “survival bag” for everyone in your family is extremely important.  If something happened in the city where you live and you suddenly had to “go”, what would you put your most important stuff in?  How would you carry it all if you had to travel by foot?  These are very important things to think about. 

#19) A Community

During a long-term crisis, it is those who are willing to work together that will have the best chance of making it.  Whether it is your family, your friends, a church or a local group of people that you know, make sure that you have some people that you can rely on and work together with in the event that everything hits the fan.  Loners are going to have a really hard time of surviving for long.

#20) A Backup Plan

Lastly, it is always, always, always important to have a backup plan for everything.

If someone comes in and steals all the food that you have stored up, what are you going to do?

If travel is restricted and your can’t get to your “bug out” location immediately do you have a Plan B?

If you have built your house into an impregnable survival fortress but circumstances force you to leave do you have an alternate plan?

The truth is that crisis situations rarely unfold just as we envision.  It is important to be flexible and to be ready with backup plans when disaster strikes. 

You don’t want to end up like the folks in New Orleans after Hurricane Katrina.  You don’t want to have to rely on the government to take care of you if something really bad happens. 

Right now the U.S. strategic grain reserve contains only enough wheat to make half a loaf of bread for each of the approximately 300 million people in the United States.

How long do you think that is going to last?

Now is the time to get ready.

Now is the time to prepare.

The United States economy is going to collapse and incredibly hard times are coming.

Will you be able to survive when it happens?

The Economic Recovery Is Moving Along Quite Well – For The Boys Down On Wall Street

If you are part of the Wall Street establishment, the economic recovery is moving along quite well.  Many of the biggest firms on Wall Street just handed out record-setting bonuses, the Stock Market has been moving up steadily and the DOW is back up to around 11,000.  Profits at the top banks have been quite impressive lately.  Bank of America, JPMorgan Chase, Citigroup and Wells Fargo combined for first quarter profits of $13.4 billion – the most in almost three years.  Yes, life is quite good down on Wall Street these days.  People are still buying fast cars, big yachts and homes in the Hamptons.  It is almost as if “the greatest financial crisis since the Great Depression” didn’t even happen.  Things are quickly getting back to “normal” for the banking elite and to many it seems like there are a lot more smiles down on Wall Street than there have been in a long, long time.

Bank of America’s chief executive officer, Brian T. Moynihan, is being quoted by Reuters as saying that “the worst of the credit cycle is clearly behind us” and that the economic growth we are experiencing is “real”.

JPMorgan CEO Jamie Dimon is quoted as saying that the U.S. economy may be poised for “a strong recovery”.

And why wouldn’t they say these things?  Profits are up.  Their stock portfolios are up.  They are getting record bonuses.  They know that if anything does go wrong again that their friends in Washington D.C. will bail them out because they are “too big to fail”.

But for tens of millions of other Americans, the economy seems like it is getting worse than ever.  It is hard to explain the gut-wrenching agony that many highly-educated and highly-qualified American workers are going through as they send out hundreds of resumes only to get no response.  Or the absolute frustration of only being able to get a very low paying retail job and realizing that it will not even be able to pay the mortgage – much less support an entire family.  Or the soul-crushing despair of working two or three jobs and still not being able to pay the bills at the end of the month.

But these are the daily realities that millions of Americans must face now.  The truth is that there are not nearly enough jobs for everyone.  The number of unemployed Americans per job opening hit 5.5 in February.  It is like we are all caught in some bizarre game of musical chairs, and the losers end up destitute and out in the street.

Even many of those who can get jobs find themselves in bad situations.  Gallup’s underemployment measure hit 20.0% on March 15th.  That was up from 19.7% two weeks earlier and 19.5% at the start of the year.  A lot of very educated, very qualified people find themselves slaving away at jobs that high school students are qualified for.

But the ones being hurt the worst by this unemployment epidemic are the poor.  Check out the following chart.  At the end of 2009, the unemployment rate for those at the top end of the income scale in the United States was about 3%.  For those at the bottom of the income scale, the unemployment rate was about 30%….

It isn’t the boys down on Wall Street that are losing their homes and their jobs.

No, they are “too big to fail”.

It is millions of ordinary Americans that are losing their homes and their jobs.

And things keep getting worse.

According to RealtyTrac, foreclosure filings were reported on 367,056 properties in the month of March.  This was an increase of almost 19 percent from February, and it was the highest monthly total since RealtyTrac began issuing its report in January 2005.

Not only that, but RealtyTrac projects that there will be a total of 4.5 million home foreclosures by the end 2010.  If you figure that there are approximately 4 people per household, that is another 18 million people that will be facing the pain of a foreclosure filing.

For many Americans, losing their home to foreclosure is just too much.  For example, one man in Ohio actually decided to bulldoze his own home rather than let the bank take it in foreclosure proceedings.

Because of the extreme economic conditions, millions of Americans are in severe pain and are becoming increasingly desperate.  In some of the most depressed areas, crime is absolutely spiralling out of control.  So far this year in Detroit, car thefts are up 83%, robberies are up 50%, burglaries are up 20% and property destruction is up 42%.

Adding to all of this economic despair is the fact that food and gas prices are starting to shoot up.

In some areas of the United States, people are already paying as much as $3.50 for a gallon of gasoline, and many experts are now predicting that gasoline could hit $4.00 a gallon by the end of 2010.

Not only that, but wholesale food prices rose 2.4% in March, matching the biggest gain in 26 years.

So while the economic recovery is buzzing along quite well down on Wall Street, the reality is that for millions of other Americans things are really hard.  In fact, not even the smaller banks are experiencing much of a recovery.  The FDIC’s list of problem banks just hit a 17-year high.

No, the main beneficiaries of this “economic recovery” are the boys over on Wall Street.  They should enjoy it while it lasts, because even harder economic times are on the way, and the reality is that none of us will be able to completely escape the economic pain that is coming.

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Megabanks: The Banking Oligarchy That Controls Assets Equivalent To 60 Percent Of America’s GNP

Today financial power is being concentrated in the hands of fewer and fewer individuals.  In fact, the six biggest banks in the United States now possess assets equivalent to 60 percent of America’s gross national product.  Back in the 1990s that figure was less than 20 percent.  These six banks – Goldman Sachs, Morgan Stanley, JPMorgan Chase, Citigroup, Bank of America, and Wells Fargo – literally dictate what goes on in the U.S. banking industry.  These entities are the poster children for “too big to fail”, and they donate massive amounts of cash to the campaigns of both Republicans and Democrats to ensure that they will continue to receive favorable treatment.  The vast majority of Americans have had a banking account, a credit card and/or a mortgage with one of these institutions at some point.  If they acted in concert, these six banks could literally bring down the U.S. economy overnight if they wanted to.  Together with the Federal Reserve, these six banks represent the real financial power in America.  They are the 800 pound gorilla in the room that influences nearly every major financial deal that gets done and virtually every major political decision that gets made.  As the last couple of years have demonstrated, top politicians from both parties (John McCain and Barack Obama for example) will instantly jump into action and start advocating that the U.S. government spend billions upon billions of dollars when the interests of these behemoths are threatened.  The frightening thing is that the power of these megabanks is growing at a frightening pace.  As dozens upon dozens of smaller U.S. banks are “allowed to fail”, they either go out of existence or the Feds actually encourage these smaller banks to sell themselves to one of the big sharks.  In either event, the banking power in the United States becomes further consolidated in the hands of the megabanks.

Bill Moyers recently interviewed Simon Johnson and James Kwak, the authors of a new book entitled 13 Bankers: The Wall St. Takeover and the Next Financial Meltdown.  During that interview Kwak described to Moyers just how explosive the growth of the power of these megabanks has been….

Bill Moyers: And you write that they control 60 percent of our gross national product?

James Kwak: They have assets equivalent to 60 percent of our gross national product. And to put this in perspective, in the mid-1990s, these six banks or their predecessors, since there have been a lot of mergers, had less than 20 percent. Their assets were less than 20 percent of the gross national product.

Does it alarm you that the banking elite have accumulated such a large amount of financial power?

It should.  These institutions have the power to wreck entire economies.  Just consider what happened in Greece lately.  Now, it is being alleged that the megabanks are ripping off American cities with the same kinds of predatory deals that brought down the financial system in Greece. 

And that is what these megabanks are.

They are predators.

In fact, a very revealing article in Rolling Stone described Goldman Sachs this way….

The first thing you need to know about Goldman Sachs is that it’s everywhere. The world’s most powerful investment bank is a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money.

Unfortunately, they may have actually been understating things a bit.

These megabanks have rigged the game so that the wealth of the nation is slowly transferred from us to themselves and to the international financial interests that control them.

They can make money if the markets are going up, and they can make money if the markets are going down.

For example, in a newly released email from the height of the housing crash, the CEO of Goldman Sachs bragged that his firm “made more than we lost” by betting against the housing market.

Thankfully the SEC is starting to look into the fraud that Goldman Sachs committed during this time period, but the truth is that Goldman is not likely to receive any more than a slap on the wrist for what it has done.

They are way too big, way too powerful and have too many friends in high places for them to get into any real trouble.

For example, it has come out that Barack Obama does not intend to return any of the campaign contributions that he received from Goldman Sachs.  And surely they will be glad to continue to pour big money into his political coffers.

So where does that leave the rest of us?

Well, the rest of us can expect higher taxes and a lower standard of living according to the IMF.  The IMF (which has deep connections to these megabanks) says that the party is “over” for nations that have been enjoying the good life.  In a recent article, the Washington Post summarized the message that the IMF is trying to communicate through their recent policy papers….

To keep the global economy on track, people in the United States and the rest of the developed world need to work longer before retiring, pay higher taxes and expect less from government. And the cheap imports lining the shelves of mega-chains such as Wal-Mart and Target? They need to be more expensive.

So are you ready to work longer, pay higher taxes, expect less from government and have a lower standard of living?

That is what the IMF says we are all going to be facing in the years ahead.

We are all going to financially suffer as the megabanks continue to thrive and consolidate power.

Isn’t that wonderful?

You say you don’t like that so much?

Well, good luck taking on the 800 pound gorilla.

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