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If A Global Recession Is Not Looming, Then Why Are Bailouts Flying Around As If The End Of The World Is Coming?

I have learned that watching what people do is much more important than listening to what they say.  Back in 2008, financial authorities in the United States insisted that everything was gone to be okay.  But we all know now that was a lie.  Well, right now financial authorities in the U.S. and Europe are once again trying to assure us that everything is under control and that we are not headed for a global recession.  Unfortunately, their actions are telling a very different story.  All over the world, bailouts are flying around as if the end of the world is coming.  Governments and central banks are stepping in with gigantic mountains of money to prop up bond yields, major banks and even stock markets.  What we have seen over the past few months has been absolutely unprecedented.  So why are such desperate measures being taken if everything is going to be just fine?  Unfortunately, debt problems are never solved with more debt, so these bailouts really aren’t solving anything.  We are still headed for a massive amount of financial pain.  It would just be nice if the authorities would quit lying to us and would actually admit how bad things really are.

Today it was announced that the European Central Bank has agreed to make $638 billion in 3 year loans to 523 different banks.  Never before (not even during the last financial crisis) has the ECB loaned so much cheap money to European banks at one time.

This move by the ECB made headlines all over the globe.  CNBC is calling them “ultra-long and ultra-cheap loans“.

European authorities are hoping that European banks will use this money to make loans to businesses and to buy up the debt of troubled European governments.

But as we have seen in the United States, bailout money does not always get spent the way that the authorities intend for it to be spent.

The truth is that the banks could end up just sitting on the money.  That is what happened with a lot of bailout money in the United States during the last financial crisis.

European authorities hope, however, that European banks will take this super cheap money and lend it to European governments at much higher interest rates.

Unfortunately, global financial markets were not terribly impressed with this move by the ECB.  European bond yields actually rose and the euro just kept on falling.

Every few days another major “solution” to the European debt crisis is put out there, but so far nothing has worked.

For example, the European Central Bank has already spent over 274 billion dollars directly buying up European government bonds, and yet bond yields continue to hover in very dangerous territory.

But without ECB intervention, we probably would have already seen a major financial collapse in Europe.

The financial system of Europe is a total mess right now, and everyone is becoming incredibly dependent on the ECB.  The following comes from a recent Reuters article….

One of the key factors certain to have boosted demand is that banks are now more reliant than ever on central bank funds. The ECB said on Monday, in its semi-annual Financial Stability Review, that this dependency could be difficult to cure.

French banks have almost quadrupled their intake of ECB money since June to 150 billion euros, while banks in Italy and Spain are each taking more than 100 billion euros.

At this point, the ECB has the weight of the entire world on its shoulders.  One false move and we could see a huge wave of bank failures and we could be plunged into a major global recession.

But even with all of this unprecedented assistance, we have already seen some big time European banks fail.

Back in Obtober, Dexia was the first major European bank to be bailed out, and the cost of that bailout is going to exceed 100 billion dollars.

The funny thing is that Dexia actually passed the banking stress test that was conducted earlier this year with flying colors.

So what does that say about all of the other major European banks that did not do so well on the stress test?

In addition, it was recently announced that Germany’s second largest bank is going to need a bailout.

The following comes from a Sky News report….

Germany’s second largest bank, Commerzbank, is reportedly in discussions with the German government about a bailout after regulators said it needed to raise more money to cope with a potential default on its loans to governments.

“Intense talks” have been going on for several days, according to sources who spoke to the news agency Reuters.

Even with unprecedented intervention by the ECB, the truth is that the European banking system is rapidly failing.

In Greece, a full-blown run on the banks is happening.  According to a recent Der Spiegel article, funds are being pulled out of Greek banks at a pace that is astounding….

He means that the outflow of funds from Greek bank accounts has been accelerating rapidly. At the start of 2010, savings and time deposits held by private households in Greece totalled €237.7 billion — by the end of 2011, they had fallen by €49 billion. Since then, the decline has been gaining momentum. Savings fell by a further €5.4 billion in September and by an estimated €8.5 billion in October — the biggest monthly outflow of funds since the start of the debt crisis in late 2009.

In all, approximately 20 percent of all deposits in Greek banks have been withdrawn since the start of 2011.

Other European nations are implementing draconian measures in an attempt to protect their banks.  For example, in Italy all cash transactions over 1000 euros have been permanently banned.  People will either have to use checks, debit cards or credit cards for large transactions.  This will “encourage” people to keep more money in the banks, and this will also make it much easier for the Italian government to track transactions and to collect taxes.

But it is not just in the EU where we find unusual steps being taken.

In the UK, the Bank of England is acting like the end of the world is about to happen.  The following comes from a recent article on the This Is Money website….

The deputy governor of the Bank of England today warned the situation surrounding the single currency was ‘worrying’ and that the Bank was making preparations to support British banks, should the eurozone collapse.

A temporary loan facility has been introduced as a precaution, for use in the event of contagion from the eurozone crisis endangering UK institutions, Charlie Bean said in an interview on BBC Radio 4’s World at One.

An article posted on Business Insider a while back says that Switzerland is also preparing for “a euro collapse”….

The Swiss government is preparing for a collapse of the euro, according to Swiss Finance Minister Eveline Widmer-Schlumpf.

She told parliament that a work group was studying the imposition of capital controls and negative interest rates to protect Switzerland from the capital flight that a euro collapse would engender

Frightening stuff.

On the other side of the world, the government of China is also taking action.  In fact, China is actually injecting money into the stock market in order to prop up stock prices.

The following comes from an article in the China Post….

In a movement considered “long overdue” by some analysts, the injection of government money into the tanking stock market to prop up stock prices has been given the green light, government officials announced yesterday.

Vice Premier Chen, the topmost government official charged with the country’s financial stability, however, insisted the fundamentals of the economy and the stock market are sound, expressing his hope for continued optimism among the people.

Of course the Federal Reserve is not going to stand on the sideline while all of this is going on.  In a recent article, I described how the Federal Reserve is helping to bail out European banks….

The Federal Reserve, the European Central Bank, the Bank of England, the Bank of Canada, the Bank of Japan and the Swiss National Bank have announced a coordinated plan to provide liquidity support to the global financial system.  According to the plan, the Federal Reserve is going to substantially reduce the interest rate that it charges the European Central Bank to borrow dollars.  In turn, that will enable the ECB to lend dollars to European banks at a much cheaper rate.  The hope is that this will alleviate the credit crunch which has gripped the European financial system by the throat.  So where is the Federal Reserve going to get all of these dollars that it will be loaning out at very low interest rates?  You guessed it – the Fed is just going to create them out of thin air.  Our currency is being debased so that Europe can be helped out.

If the global financial system was in good shape, all of these bailouts would not be happening.

These desperate measures are a clear sign that something is up.

The financial authorities of the world are doing their best to keep the system together, but in the end they are not going to be able to prevent the collapse that is coming.

The world is heading for incredibly hard economic times.

So is the end of the world coming?

No.

But to many in the financial world it may feel like it.  The coming global recession is not going to be fun.

We have now reached a point where it has become “normal” for governments and central banks to throw money at one financial crisis after another.

At one time, bailouts were so unusual that they provoked a great deal of outrage.

Today, bailouts have become standard operating procedure.

The bailouts will continue to get larger and larger, and authorities all over the globe will do their very best to keep the house of cards from coming crashing down.

Unfortunately, they will not be successful.

  • Bret Simpson

    Love it…this pile of ******** Ponzi crapitalism has shown its face to even the most ignorant.The powers to be won’t go down without a fight..dig in.

  • I AM ONLY TRYING TO HELP

    What will life be like 10 years from today? Here’s a glimpse into the future

    DVDs will be as old school as videocassettes were in 2010. Blockbuster, Netflix and other stand-alone DVD rental outfits will all be out of business, replaced by online, on-demand movies and CABLE/SATELLITE programs.
    GET OUT of those stocks NOW if you own them!
    STOP buying DVD’S now at Walmart, imagine all the old DVDs laying around your home.

    Virtual reality video games for the home will make the Nintendo Wii look like Pong.
    WOULD YOU BUY PONG TODAY?
    STOP buying video games for your kids STOP it now!

    Outdoor smoking will be banned in most places as the political strength of the dwindling number of smokers dwindles, QUIT now save your self the hassle later.

    -Electric cars will be the emerging vehicle of choice for city driving, having been led into the mainstream by the Chevy Volt. DON’T finace a new car just yet hang on to the old clunker till you see the new wave of electric cards.

    this is just a sample of the future you should all be preparing for now..not guns and ammo and cans of food.

    • Highspeedloafer

      Yeah, that chevy dolt, err volt is a real winner ehh? They haven’t even sold 10,000 cars, just a little over 1/2 of that. Listen anything our government produces sucks.

      • http://none Hal

        Chevy Dolt! I like that – very good!

      • BenjiK

        I couldn’t agree with you more. It does make one wonder if the Chevy Dolt would have had more success if the feds would have kept their oppressive fingers out of it, as the Dolt has been welcomed about as much as a turd in a punch-bowl……

        • KishinD

          The Volt would have more success if the middle class wasn’t drowning… loans are harder to come by, used vehicle sales are up, national savings are down… it’s the economy, stupids. The basic design of the Chevy Volt has been around for over a century, but combustion motors have been more profitable for the car/oil industries. That’s why innovation has been actively suppressed.

    • gary2

      very interesting predictions. thanks

  • http://www.planorperish.com Gutter Economist

    So why are such desperate measures being taken if everything is going to be just fine?

    It would just be nice if the authorities would quit lying to us and would actually admit how bad things really are.

    The authorities are telling the truth:

    We are not headed for a global recession – we are headed for an engineered global economic collapse.

    Everything will be just fine for the engineers (ECB and Fed).

    The coming global economic collapse will result from the following 3 step plan:

    (1) Create as much debt as possible.

    (2) Bail out the debtors and manage the financial markets.

    (3) Acquire all wealth held by debtors by making the debtors default on their credit / bailout agreements.

  • hoser

    Been dug-in for a long time. I knew something was wrong about two years ago. My money wasn’t going as far as it use to. That’s when I got smarter thanks to alternative news outlets. That was two years ago. I don’t live check-to-check but I could’nt imagine those who did two years ago compared to today! Ouch

  • CourtJester

    I truly dislike when people link the word “capitalism” with anything that is currently going on. We are not witnessing capitalism.

    It is amazing how inadequate our (local, state, national and international) educational systems are if the sheeple believe this is such.

    • http://lastdayrapture.blogspot.com/ TK

      +1 CourtJester

      It is the sheeple that will cause our downfall.
      Wake up America!

    • McKinley Morganfield

      You’re right, we do not have a capitalistic economy. We have a corrupt, rigged economy as far from a free and open market as to be in a galaxy far, far away.

      “America wasn’t founded so that we could all be better. America was founded so we could all be anything we damned well pleased.”

      “Every government is a parliament of whores. The trouble is, in a democracy, the whores are us.”

      “Giving money and power to government is like giving whiskey and car keys to teenage boys.”

      “The Democrats are the party that says government will make you smarter, taller, richer, and remove the crabgrass on your lawn. The Republicans are the party that says government doesn’t work and then they get elected and prove it.”

      “When buying and selling are controlled by legislation, the first things to be bought and sold are legislators.”

      Some wit and wisdom from P.J. O’Rourke to lighten your heart. ;-)

  • 005

    Sad to say, that I’ve reached the point of just
    too tired to care anymore. This doesn’t relate to the article, just after studying these topics for so long, and yet it seems no one can break through “the Matrix” they’re all living under, I’ve reached the point of “what’s the point.”
    Strangely, I’m reminded of the first “Mad Max” film, it was a society in decline, and somehow the citizens just went about their little errands each day, and it just kept falling apart day-by-day.
    publish this, or don’t, I’ve spoken my peace

    • D

      Same here. I used to be energized about these types of dire newscasts, but now I just don’t care. There is absolutely no possibility of stopping the eventual collapse and WWIII. People are living in their matrix, and at this point, don’t have the power to stop it anyway.

      I’m prepped up well. Maybe I’ll last a few years when the SHTF, but will I really want to? All it will take is for some traveler to pop a cap in my head to take everything I’ve prepped up for. I’m a believer in a higher power, so it really doesn’t bother me. It would be interesting to witness the circus though.

      • HeartofShadows

        Same here.
        Overtime you just get blown out and too see your friends and family still believing everything they are told and actually think things are getting better just makes you realize how hopeless it really is.
        I’m not a christian but pray..
        We truly need it now..

  • http://EconomicCollapse Already Gone

    Desperation at it’s greatest height this is a move that will end up as another failed attempt
    to sugarcoat this incredible mess. it would be nice if they would tell everybody the truth but
    how many people could handle the truth? How many
    would panic,commit suicide,have a heart attack and drop dead on the spot? These people will never tell the truth to the american people because they look at them as imdbeciles that
    could not comprehend the truth.Either way it does not matter to them because over the years
    they have built a very elaboate system to protect themseves at the taxpayers expense and
    what is there for us? nothing no civil defense
    program to educate people no shelters absolutely nothing Get The Picture now?

  • Gary2

    How about the homeowners and the poor/students getting bailed out. F the banks. Pay off all student debt, lower peoples mortgage to actual home value.

    We need bail outs for the people and not the banks and corporations.

    • Anonymous

      I have found the perfect answer to your persistent calls to “tax the rich.” Please watch this video in entirety. It’s only 6 mintues long. It will show you just how dire our fiscal situation is.

      http://www.youtube.com/watch?v=JY8LKII_MNA

      • 007

        This video so refutes the argument of taxing the rich, Gary2 will never try to have the nerve to address it.

        • KishinD

          How about… we tax all the money that is currently sheltered in overseas “investments”(often nothing more than a foreign P.O. Box) and doesn’t currently show up as income on tax sheets for the most profitable corporations and wealthiest earners? How about increasing capital gains tax? How about taxing the derivatives market before the bubble bursts?

          This video does a good job of displaying the insane scale of federal government spending, but totally ignores the potential to tap a bloated financial sector and complex tax avoidance.

          Ooh, tax the rich (pre-Bush levels) AND cut spending! Wait, that was the Democrat’s plan… Republicans, bring out another filibuster!

          • Gary2

            I find conservatives to view things as black or white and they do not have the capacity to see that there are a lot of gray areas.

            This is why they are referred to as low information and why studies show that foxs news viewers are dumber than the general population which is saying a lot as as the general population, while lets just say many are a few fries short of a happy meal.

    • knightowl77

      How about you become self-reliant and we bail out No ONE? Seriously, take care of your self, and if you have extra or can get by with less, then help out a neighbor….No more bail-outs, no more too big to fail….You’re a business and going broke…don’t look to the taxpayers….
      The Gov’t is broke, but thinks that it can spend and spend on a lot of crap that is a total waste…
      Ethanol subsidies-GONE
      Solar subsidies-GONE
      Oil subsidies-GONE
      Studying useless stuff in foreign countries, like prostitution in Hong Kong or Gay Bars in Argentina -GONE GONE GONE….
      How about ending foreign aid to ALL countries…Do you know we give more than a Billion dollars a year to Saudi Arabia on top of all the money we spend on Oil???? W-T-F !!!!! Those are more bail outs that we cannot afford….When you END all the wasteful Gov’t spending (ALL of IT) and we still can’t balance the budget on our current taxes then and only then I might be persuaded to pay more…Till then…PISS Off!

      Merry Christmas to all-even Gary!

      • gary2

        thanks merry christmas to you also.

    • mondobeyondo

      I don’t think it will work.
      The bankers will just come to us and say, “You signed these loans and agreements, didn’t you? You knew the risks involved! (umm… but you didn’t read the half page of fine print in 6 point Helvetica font, idiot…) That’s your signature on the form, right? You agreed to the requirements, obligations, and so on and so forth. You signed the form!! So now, you’re obligated to pay your student loans back!”

      – or something like that.

    • McKinley Morganfield

      “… lower peoples mortgage to actual home value.”

      And what would that value be? When you buy an asset (a house in this case) you buy it with the understanding that its value over time may increase or decrease. That is the risk one takes when investing. Life is not risk free, chew all the lotus leaves you want but it will not change this simple truth.

      • Rancher

        Right on…If the value of the home went up they would scream like stuck pigs if we raised the mortgage to reflect that…right?

      • gary2

        life is risk free for the wall street crooks. They created more damage than all the homeowners times 10 yet homeowners got nothing and wall street/bqankers were made whole. No problem getting money fopr wall street buit wee are told no money for homeowners? OWS!

        No more socialism for the rich, and capitalism or what passes for it for the rest of us.

        Soicalism for all except the rich and coporations.

    • http://www.youtube.com/safearmsreview SafeArmsReview

      Yea lets continue to borrow more money we cannot repay & put our country in still worse conditions.

      You just dont get it, borrowing no matter the cause now will only hasten the destruction.

      NO ONE forced these ppl to borrow more than they could afford – you reap what you sow. Its those that saved, prepared & lived within their means who will survive.

      Advocating more debt is like injecting another liter of poison into an already critical patient.

      VERY BAD

    • Kw

      Gary
      Your same song and dance is so stale and tiring. You are obviously not very bright. No one should be bailed out. There is no money. I would have thought by reading this site even you could understand. Things will come crashing down and Obama and all the libs you worship aren’t going save the day for you. If you are unhappy with your lot in life maybe you should have made better choices instead of spending all your energy on envy and jealousy. Very pathetic

      • gary2

        ok rush, …

      • Gary2

        there is a ton of money-as Celente says there is too much in too few hands and to little in too many hands.

  • 007

    We all knew it was only a matter of time for the ECB to start printing money to buy the bankrupt sovereign debt. Unfortunately, the only thing that will stop the money printing will be staggaring inflation which will cause people to riot. I believe we are not very far away from this massive inflation starting. Buy the gold on the dips.

  • Bone Idle

    Thoughts from an Australian central banker:

    “Europe swings between catastrophe and mere disaster.”

  • 007

    This is sort of funny. The ECB offers to loan the broke European banks a half a trillion euros at almost zero interest. However, the only catch is that the banks have to buy more worthless sovereign debt. This sovereign debt is what makes them broke in the first place.

    I do wonder whether these banks will be willing to buy more toxic sovereign debt. I cant imagine them buying this debt unless they are forced to. All this money will slosh into the market somehow. The only certainty of it is that it will inevitably create half a trillion euros of inflation.

  • McKinley Morganfield

    Here is what has happened in the Euro zone:

    The ECD, IMF, central banks in Japan, and Uncle Ben are pumping cash into the Euro Zone banks because many are on the verge of collapse. They are teetering because they are over leveraged by somewhere around 60:1. Why are they so over leveraged? They are over leveraged because they bought sovereign bonds from the PIIGS & France. So the the EU ‘stimulus’ is covering the banks for making bad decisions to buy sovereign debt. Its basically a bunch of monkeys trying to ************* the same football.

  • Ken Nohe

    Unfortunately, sometimes honesty does not pay. That’s certainly the case for a government or an official body. But even for people: Try going to a bank and ask for money because you “really” need it; you’re broke. Good Luck!
    In this case admitting that we are close to the edge would precipitate the outcome we want to avoid; maybe not a great idea…
    And still, there is almost nothing now that can deliver us from this conundrum. This is why it was such a bad idea to initiate all this debt process in the first place. But it felt so good then; remember, early 80s “Good Morning America” Only the smell of hot coffee was missing…

  • shypuffadder

    Listen to what the big banks say, pay no attention to what they do. All of this money being wrecklessly spent and replaced, over and over. Yet, the American worker keeping a 2% tax reduction for another two months causes our government to cry and wring its hands and wail about how its going to be paid for. Money the banks – nothing for us; more money for the banks – take from us; much more money for the banks – starve us.

    The really interesting part will be when these austerity measures begin to hit all of us. From what I have witnessed, most people aren’t willing to give up anything nor change their spending habits. When TSHTF, they plan on covering their azzes with human bodies. They can’t even imagine a food and alcohol shortage as that would be unthinkable.

    • http://lastdayrapture.blogspot.com/ TK

      +20

      If only everyone would realize that we are slaves to the banks because of the massive debt the government has racked up! Wake up people!

    • Tom

      A food shortage I cound handle- but please, I don’t even want to think about living through an alcohol shortage! Life truly would not be worth living. I guess I better start building a still (in the shed, so no one sees it).

  • REED RICHARDS

    Bret Simpson,

    GUARD! GUARD! CAN WE GET SOME SERVICE IN DIS HERE JAIL?

    Dig in to what? When complete collapse occurs and everyone is locked up in FEMA concentration camps, none of this is going to matter.

    • Rancher

      Hey can you back that up with Google aerial photos of the sits please. Oh you can not? Typical….

    • yooperguy

      Fema Camps? They aren’t to lock us citizens in, Bret. They would need a camp the size of Wyoming to fit all the dissenters in. The camps are to keep us OUT, and protect those they choose to protect. It would be IMPOSSIBLE to police/incarcerate/feed one small city, let alone an entire nation of 330 million people. Even if only 1 in 100 fought back, thats still ove 3 million people. Physically and logistically impossible, my friend.

      • http://www.planorperish.com Gutter Economist

        FEMA camps are for strong>depopulation operations.

        Underground bunkers are for protecting the elite.

      • REED RICHARDS

        yooperguy,

        Hence the use of predator drones against the american people. North Dakota farmers run amok anyone?

      • jq

        Thus the coffins!

  • William

    In Europe, bankrupt countries with huge debt that can not, and will not, be repaid are being bailed out by bankrupt banks and bankrupt countries (less Germany) to whom the bankrupt countries owe money. Neat, HUH?? Of course, the UNCONSTITUTIONAL Federal Reserve will invent more soon-to-be worthless dollars to backstop the ECB and other Rothschild banks. This is real…..even an IDIOT like Bush could not imagine this.

    • knightowl77

      Can you get through a day without thinking about or mentioning Bush??? He has been gone 3 years….Just sayen…..Oh & Have a Merry Christmas.

  • zeitgeist

    This you tube video summarizes the underlying reason we have financial difficulties in this country. Much of the cause is due to entitlement programs due to “robin hood” ideology of redistribution of wealth due to individual productivity capability.
    http://www.youtube.com/watch?v=i1YYZjsDsxQ&feature=related

    • sharonsj

      We are not collapsing because of social programs. We are collapsing due to government corruption and bank manipulations. Funny how half of Congress are now multi-millionaires and they are busy cutting heating aid to the poor and elderly while refusing to pay higher taxes themselves. And why should they pay anything when they can write the tax laws and give themselves corporate entitlements? I don’t see zeitgeist complaining about ExxonMobil and GE not paying a penny of federal taxes.

      • REED RICHARDS

        sharonsj,

        zeitgeist and others of who are either of, or think of themselves of “the privileged elite” will never complain about the wealthy stealing and hoarding wealth. Why? because that is who they are and the screwed up mindset they represent. As I told him, there is no Robin Hood ideology going on, but a Green Arrow ideology where the rich privileged corporate and political elite get all the “Green” and the braindead masses that support this upper class theft get the “Arrow” straigth through the heart………….

    • REED RICHARDS

      zeitgeist,

      It’s not “Robin Hood”, ideology as so many rightwingers whine about. It’s actually the Green Arrow ideology of redistribution of wealth. The wealthy elites and the bankers and their “selected political puppets” get the Green and the poor, braindead masses get the Arrow……………..

      • knightowl77

        Robin Hood…actually stole the taxes collected from the people for Prince John (or the Gov’t) and gave them back to the people….We need someone to return our taxes….

  • Martin

    It is nice to watch how this charade of clowns is unravelling.

  • http://www,Back2theLand.com Old Timer

    We become enured with words: “collapse – bailout – debt – etc, To what extent does this imply what actually happens when the system does break down since all this mess is based on the government in question promise to pay (bonds) and if the government is shakey then the banks buy up these bonds at a discounted interest rate (remember junk bonds some years back?) and have a piece of the government state property as collateral to forclose on.

    So now, dear reader, what happens to the real property collateral? How will it be managed? How will it be exploited? If you are aware that other foreign powers have bought some of our bonds and now own the National Forests, which are being cut down and shipped out to … and other pieces of property being sold off …

    Sounds like the houseing market wherein they are now bulldozing down the houses just built…Why? What is the bigger picture? Have you noticed new statutes being introduced and enforced that give precedence to foreign nationals?

    Globalization does not work. The first experiments back in the 1920’s did not work.Political leadership is beating a dead horse which is begining to rot.

    Old Timer

  • http://portlavacalots.com CTD

    I believe the Bankers and the ECB, The Federal Reserve, etc… are buying times by devalue the dollars. The paper can’t hold the fire. It is temporary while they are still looking for solution, but there is NONE at least for now. We all know this, so prepare for your self and holding tight for a good long ride.

  • Syrin

    We aren’t facing a global recession. We are facing global finacial collapse. No one will be able to bail out the banking cabal this time.

    Bank on Obamugabe trying, after all he is the single biggest recipient of Wall Street campaign dollars in US history (Betcha didn’t know that Gary). Half his Cabinet are former Goldman Sachs execs or board members. So expect more of our dollars going to bail out the banking system.

    Speaking of Goldman Sachs, does everyone here know that they had their board members appointed president/prime minister of Italy and the head of the European Central Bank?

    • mondobeyondo

      I tend to agree.

      We’ve been through recessions, and depressions. But never such a crisis we are facing now, on a global scale. This is uncharted territory.

    • Gary2

      syrin-I am deeply disappointed with Obama for appointing the likes of Holder, Sommers, Guithner. You are correct about wall street being a big donor to him. He has been way to conservative. If I wanted a conservative (and I don’t) I would have voted for McCain.

      The only real progressive is Bernie Sanders of Vermont.

  • Syrin

    Bret, this isn’t capitalism. In capitalism, a business takes calculated risks, and suffers the consequences of bad business decisions. What we have now is big business, specifically the finacial sector, owning the gov’t with this administration being the most “owned” administration in US history that allows for them to create a hostile environment that crushes all competition and only allows the favored giant corporations to survive. There is no competition, is no loss. All the crucial components of capitalism have been removed.

    • http://lastdayrapture.blogspot.com/ TK

      +1

    • McKinley Morganfield

      “What we have now is big business, specifically the finacial sector, owning the gov’t with this administration being the most “owned” administration in US history that allows for them to create a hostile environment that crushes all competition and only allows the favored giant corporations to survive. There is no competition, is no loss. All the crucial components of capitalism have been removed.”

      We used to call it fascism! I have to chuckle at die hard leftists, like Gary, you fail to realize their messiah is actually as much a fascist as Mussolini.

    • Tom

      The new law of the banking and finacial sector- All profit is private, all loss is public.

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  • Charles

    The trouble is none of the banks will come clean about how many toxic derivatives are still hidden in their accounts so nobody really can say when they will start lending aqgain and get the stalled financial system working something like normal again. My guess is there are still $trillions of bad debts hidden away that banks are not admitting too.

    • McKinley Morganfield

      I’ve read estimates, by credible analysts who put the amount of toxic (over leveraged) assets on the books of banks all around the globe in the 200+ trillion $ range. Scary indeed.

  • Scott

    Recession? We need to start using the word Depression.

  • http://www.youtube.com/user/TheMainStreetProject ex VRWC

    Here is my latest song about this – The ZIRP Song. It does a good job of laying out the perils of ZIRP, which we are seeing unprecedented use of, as you correctly point out. Keep up the good work.

    http://www.youtube.com/watch?v=7Msnp9_C06Y&context=C3135166ADOEgsToPDskJi-zNFJn8CR_t-CFa42Uwo

    • nowwthen

      EXCELLENT!!! Brings back old memories of songs like “The Eve of Destruction” by Barry McGuire.

      • http://www.youtube.com/user/TheMainStreetProject ex VRWC

        Thank you! Check out the youtube channel (click my name). 4 songs there now, a few more are in the works. The most popular has been ‘Globalize’. Spread them around!

      • nowwthen
  • http://www.youtube.com/aNYCdj Richard Allen

    Bailouts for everyone except those who are responsible.

    Don’t ya think I could use that zero interest rate on my credit card for 3-5 years?

    Don’t ya think I could use a $3000 pay down on my credit card balance so I can buy new shoes or an up to date laptop instead of being tied to a desktop? or maybe a smart phone

    If we are to be a mobile workforce then spending oops investing this money in people should be priority #1

    And look at all the cheap running cars they destroyed in the cash for clunkers program, does anyone know where to find a $500 running car that passes inspection and emissions?

    I’m usually not a real serious pessimist, but it gets harder everyday to see the light at the end of the tunnel…..

    • 007

      Really, just think what good this money would do if loans out to individuals and small businesses. Every small business I know has liquidity concerns. Heck everyone could just invest in AT&T with 5% dividends and pocket the profit. The ECB is as committed to the Fed at screwing over the average man and benefitting the banksters.

      • http://lastdayrapture.blogspot.com/ TK

        +100 007

        As a small business owner, a 0% loan would be wonderful. There are many opportunity’s that get passed up due to cash flow. It seams everyone I know has the same problem except the TOO BIG TO FAIL!

  • Barn Cat

    Actually, the end of the world IS coming. At least the end of the world as we know it. We’ll see the collapse of the dollar, bankruptcies at all levels of government, a complete economic collapse, no police, no fire protection, no running water, and no electricity. That’s setting the stage for a crisis big enough to lead to the one-world government prophesied in Revelation.

  • George

    You know a government has become insolvent when it either “nationalizes” (i.e., seizes) pension funds or defaults on its pension obligations.
    (1) Argentina, the poster child for national insolvency, seized all private pensions a few years ago. The government needed the money.
    (2) Portugal just seized the private pensions held by the country’s largest banks.
    (3) Today, Hungary seized all private pensions.
    (4) The Greek pension system needs 3.5 billion euros from its bankrupt government to continue full pension payments. The pension system will default when the requested government assistance is denied by the Troika.
    (5)The City of Central Falls, Rhode Island, which is in bankruptcy, has just negotiated a 60-70% decrease in its future pension liabilities with its retirees.
    (6)Unfunded pension liabilities for state and local governments are 3.5 Trillion dollars. Some state (e.g., Illinois and California) and local (e.g., Detroit) governments are deeper in the hole than others.

    Partial pension defaults will have to occur as government finances deteriorate and pension claims accelerate.

  • liberranter

    The good news, as Bret Simpson points out, is that even the densest of sheeple new realize the the powers that be are FoS and don’t believe a syllable of their lies. The frightening thing is that the those who should know better, in which category I include financial managers, CPAs, tax attorneys, and anyone else connected with finance and taxes, is so caught up in the Grand Scam and has so much to lose when fiscal reality asserts itself that they’re in unbelievable denial. I’ve actually had financial “experts” tell me to my face, in earnest, that these big banks and national goverments are too big to fail and “can NEVER go bankrupt.” Scary, that people in such positions of trust and authority are this delusional. I shudder to think, for their sakes, what their fates will be when that reality of which I speak DOES assert itself in no unmistakeable form.

  • Bill

    So sad, just read an ad by a single mom of four asking for help so her kids could have a Christmas while another article describes our so-called president flying his dog back from Hawaii, (and another Michelle million dollar vacation), so the scp could have a photo-op shopping at PetSmart. Like the bankers these people have no conscience. Once again I’ll say “FLUSH THE TOILET” !

  • Antonio Gonzalez

    Remember Nixon open de door ( august 15 /1971) then everythings
    going well and everyone very , very happy>

    But now the is over.

  • Rancher

    Who really cares… Why care? It is out of your hands and mine.

    Best be stocking up my friends…stocking up. In fact if you had half a brain you would have seen this coming many years ago and be fully stocked up by now.

    If you had, then right now you could be sitting back and watching….

  • Dr. Tonnie Moenir

    ” It will be worse than you are expected, like domino chain, once the first one fall will follow until the last cards, turbulence’s one after another, keep your fund in your own pockets “

  • juan smith

    Gee, all this money printing. Do you suppose I’m making the right moves in buying more gold and silver?

  • mondobeyondo

    Why are bailouts flying around like mad around the world? Sounds like someone(s) in the financial industry has some “inside knowledge” about what is REALLY happening. And you won’t find it in the Wall Street Journal, New York Times, CBS News or Barron’s.

    What you see is not necessarily what you hear. And more often than not, what you see AND hear is not the truth!

    Use your sense of smell for the best results. This whole deal smells like a rat. In fact, it stinks.

  • Rancher

    preppergroups.com

    Go there and make yourself into an asset and then join with others. You can bet there is nothing the govt is planning to do for you in the crash other than control you while you wither away….

  • Man with no name

    What is happening is this :

    The elite are organising all these so-called bailouts to ensure that the recipients are totally incapable of repaying their debts, so the elite can buy their assets at rock bottom prices and effectively force the world to embrace the NWO and single currency system.
    After all, the countries are all insolvent – they have no choice but to agree to what is the only “way out” !

  • Newton

    Blue Smoke and Mirrors Baby

    Blue Smoke and Mirrors

  • Gary2

    According to the latest data on year-end bank bonuses, 3.5 million jobs with benefits could’ve been created by spending the bonuses from only six firms: Wells Fargo, Chase, Bank of America, Goldman Sachs, Morgan Stanley and CitiBank.

    And the doltish repubes want to cut taxes further on the rich. Repubes are immoral scum and I am being nice in only saying that about them

    2012 the year of taxing the rich and spreading the wealth.

    • 007

      I am sure that is the answer to our economic problems.

      http://www.youtube.com/watch?v=JY8LKII_MNA&feature=youtube_gdata_player

      • Michael

        I don’t think that Gary is going to like that video. ;)

        Michael

        • Gary2

          Michael-this video was completely refuted by some tax policy think tank–EPI?

      • Gary2

        Its typical low info right wing crap-they totally miss where corporations like GE pay nothing etc.
        From SharonsJ:

        We are not collapsing because of social programs. We are collapsing due to government corruption and bank manipulations. Funny how half of Congress are now multi-millionaires and they are busy cutting heating aid to the poor and elderly while refusing to pay higher taxes themselves. And why should they pay anything when they can write the tax laws and give themselves corporate entitlements? I don’t see zeitgeist complaining about ExxonMobil and GE not paying a penny of federal taxes.

        From Reed Richards:

        zeitgeist and others of who are either of, or think of themselves of “the privileged elite” will never complain about the wealthy stealing and hoarding wealth. Why? because that is who they are and the screwed up mindset they represent. As I told him, there is no Robin Hood ideology going on, but a Green Arrow ideology where the rich privileged corporate and political elite get all the “Green” and the braindead masses that support this upper class theft get the “Arrow” straigth through the heart………….

  • r.bitting

    Jesus Christ is Lord of all.

  • Nickelthrower

    Greetings,

    Watch this film – seriously, watch this film.
    http://www.endciv.com

    Share it with everyone you know as this film clearly outlines the next step we must all take.

  • Timo44

    I just hope when it do go down people understand how to blame. Make sure we remove, ******************* all central banks. They have to go if they don’t they will just keep destroying countries and peoples life.

  • luis

    HACKER: EVERYONE WE MUST PROCTECT THIS LAND AN UR FAMILYS FROM THE UNITED NATION THERE GOING CONTROL THE U.S.A IN THE NEAR FUTURE SO PREPARED. FREEMASON AN UN ILLUMINATI THERE UR TARGET TO DESTROY PEOPLE.. HACKER UK

  • William

    This all started about 225 years ago with a man named Adam Weishaupt. President Jackson routed these international bankers out of America. But, the satanic evil returned, and in 1913 President Wilson was BLACKMAILED into signing the legislation creating the FED into law. *****************

  • mondobeyondo

    Saw an article on CNN (Cuckoo News Network) that nearly one-fourth of people haven’t even started their Christmas shopping yet!

    A few hypotheses..

    1. Working people who actually got a Christmas bonus this year finally have a little extra money to buy cheap Chinese crap

    2. 1/4th of the population (at least) didn’t participate in Black Friday

    3. Procrastination

    4. These people have no money to splurge.

    5. Do they know it’s Christmas after all? (it’s a song title, Google it)

    BUT – you can bet the big banksters and Wall Street high rollers are breaking out the cigars and champagne, and saying “Ho ho ho” to their friends as they get yet ANOTHER BAILOUT.

    Oh!!! Those evil… despicable… I can hardly speak their names… those WINTER WARLOCKS!!!
    (to paraphrase Fred Astaire’s voice in “Santa Claus is Coming to Town”)

    By the way: Merry Christmas, everyone!

  • Cinderella Man

    @ IM ONLY TRYING TO HELP, You must think we’re going to have a Jetson’s style of future, or maybe Back to the Future pt.2 perhaps? No my friend people should be prepared for either a Mad Max or the Road or maybe a Running Man type of future. The only techinal advances will be for the Govt. to have better, more efficent weapons (hopefully not Terminators) to kill, sterilize, and cower us with. If things keep going the way they are a revolution WILL take place. The goverment is not operating with the consent of the governed. What we are is PISSED OFF.. I know I am I just spent $65 on corned beef for our Mid-Winter shopping holiday meal, and I can remember a time, not more that 5 years ago, when they costed about $5 apeice! Meat really will be a luxury that few can afford in the near future, but thats what the elite pigs want! We can drive, but you walk! We eat steak, you have GMO gruel! We have mansions, you have shoddy apartments! See, whats good for them isnt for you, little sheeple. The breaking point is here! Dont wake up, stay asleep! Thats what they want. Consume, consume, consume, dont question authority, goverment is always right, we will protect you from yourself, Big Bro and Sis love you! Dont worry about those VIPR teams, we want you to be saaafe! Dont worry about those FEMA camps theyre happy camps! See, we have swing sets for your little serfs to play on! We mean you no harm! Uuuuh! I almost started believing that shit for a minute there! Ok no more flouride for me! Anyway trying to help your model future is not going to be there, so get over it! Good American patriots arent going to just stand there and let this happen. To quote the great General Patton, Lead me, follow me or get out of my way!

    • BenjiK

      Agreed. I keep thinking “The Postman” with Kevin Costner type of future…..

  • Cinderella Man

    Michael, are you going to do another Blue Christmas story again. I started reading your blogs about a year ago, and your last one really hit home to me. I know I have alot ot reflect upon this year, I went from sleeping in my car, and jail, to regaining employment with a wonderful company that pays me vacation even though i havent even worked here for 6 months! I have alot to be grateful for, and i honestly hope we can have a soft landing when the SHTF. Merry Christmas to you and yours Michael, thanks for the ride.

    • Michael

      We’ll see. :)

      Michael

    • Senator Ozmo

      Cinderella Man,

      Thank you for your story. It is good to hear that people are able to make a start. I agree there are too many people sleeping and those who have seen something might be too afraid to do anything or better yet not know where to start.

      Again Congratz on your story I am glad you have a lot to be thankful of. Please keep your head up and keep preparing :).

  • Patriot Alice

    If they are taking desperate actions, it is because we live in desperate times…..Unless we’ve become Paranoid or Post Tramatic Stress Disordered in a massive scale.

  • OnlyLiberty4Me

    In 1983 I earned $3.35/hour bussing tables. That money had the equivalent buying power of nearly $25/hour in today’s money. As a commercial pilot, I earn LESS $$$ (corrected for inflation) than I did as a bus boy. Yeah…the game is nearly over.

  • joefarm

    Ultimately, One world government, One world currency, One globe ID card system, One gold standard is the financial solution.
    But create a third branch in world government; instead of Congress and House Representatives; establish a Senior (not by age) advisory branch, authority over the other 2, monitoring public opinion, general conducts… 100 reps with life time appointment.
    Require all higher position official to attend public services Statesmanship school, national, regional and state levels.
    That all I have to say!

    • KishinD

      Ultimately, that’s the globalist “answer” for further centralized control.

      One world government will happen, one way or another, before 2300AD. One way is the power elite will establish a global dominion. I want another way, which is the people of the world recognizing the inherent authority of individuals forming communities is superior to established political-economic hierarchies. Freedom is prior to authority, and above it.

      1. Global Tyranny – made possible with military-style pyramid command structures and new “Information Awareness” tech
      2. Global Participatory Democracy – made possible through emerging social networking tools and the liberty of minds

      Your default choice is #1. “Do nothing” is a choice for #1. #2 must be fought for, not with weapons but tools, not for territory or resources but for human minds. If you would rather be good than obedient, it’s time to take action.

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  • 007

    I am beginning to believe the powers that be know the collapse is coming. They know they can’t stop it. They are just trying to make sure they can control the collapse and even profit from it. They just want to be in control and very rich when it hits. Very sick.

  • Anony

    I would suggest people who are deeply involved in sites like these read something that is much longer than an article, but will illuminate the “on the ground” realities of what is coming. “American Epitaph” by Damien Darby. Just use any Search engine, preferably not #google. Stay vigilant, the beginning is near.

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  • Steve

    The private sector, automating all jobs, has finished with human workers. Governments are owned by the private sector and will not provide sufficient help to displaced workers for their necessities of life. The middle and lower classes in all countries must unite and do three things: 1) Form Democratic Work Places (DWP’S) where there are no CEO’s, boards of directors, stockholders and investors, 2) Form their own vocational colleges where people learn 21st Century skills for these DWP’s and 3) Establish their own banks, i.e. Democtatic Banks that will print interest free money based on gold, silver, platinum, precious gems – anything of value that displaced workers can get their hand on. The Occupy Wall street protests will not work. Forming a 3rd political party will not work. Violent revolution will be crushed by the plutocrats. The middle and lower classes have been abandonded to fend for themselves.

  • wathap2u

    it sounds of plan to form a true one world economy. This Global Recession may be a necessary evil. This new system would possibly last for a 100 years or greater before another major change.When we look at what the future has to offer through the eyes of hollywood we see that we live in a primitive technological world.

    This is truly a well oiled monetary policy and i don’t be-lie-2-eve it can simply crash unless someone needs it to. Our focus should be on identifying those who are Service to Self (STS) or Service to Others (STO). Although both are use full they are determined by circumstances.

    If we do need to activate our R-Complex minds during this global crisis we need to do so with caution. The only power some one has over you is the power you allow.

    I know this is advise for the global financial gloom we are heading for.

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