Day Of Reckoning

A Day Of Reckoning For The Euro Has Arrived – 26 TRILLION In Currency Derivatives At Risk

February 8, 2015February 8, 2015 by Michael

This is the month when the future of the eurozone will be decided. This week, Greek leaders will meet with European officials to discuss what comes next for Greece. The new prime minister of Greece, Alexis Tsipras, has already stated that he will not accept an extension of the current bailout. Officials from other eurozone countries have already said that they expect Greece to fully honor the terms of the current agreement. So basically we are watching a giant game of financial “chicken” play out over in Europe, and a showdown is looming. Adding to the drama is the fact that the Greek government is rapidly running out of money. According to the Wall Street Journal, Greece is “on course to run out of money within weeks if it doesn’t gain access to additional funds, effectively daring Germany and its other European creditors to let it fail and stumble out of the euro.” We have witnessed other moments of crisis for Greece before, but things are very different this time because the new Greek government is being run by radical leftists that based their entire campaign on ending the austerity that has been imposed on Greece by the rest of Europe. If they buckle under the demands of the European financial lords, their credibility will be gone and Syriza will essentially be finished in Greek politics. But if they don’t compromise, Greece could be forced to leave the eurozone and we could potentially be facing the equivalent of “financial armageddon” in Europe. If nobody flinches, the eurozone will fall to pieces, the euro will collapse and trillions upon trillions of dollars in derivatives will be in jeopardy.

According to the Bank for International Settlements, 26.45 trillion dollars in currency derivatives are directly tied to the value of the euro.

Let that number sink in for a moment.

To give you some perspective, keep in mind that the U.S. government spends a total of less than 4 trillion dollars a year.

The entire U.S. national debt is just a bit above 18 trillion dollars.

So 26 trillion dollars is an amount of money that is almost unimaginable. And of course those are just the derivatives that are directly tied to the euro. Overall, the total global derivatives bubble is more than 700 trillion dollars in size.

Over the past couple of decades, the global financial system has been transformed into the biggest casino in the history of the planet. And when things are stable, the computer algorithms used by the big banks work quite well and they make enormous amounts of money. But when unexpected things happen and markets go haywire, the financial institutions that gamble on derivatives can lose massive quantities of money very rapidly. We saw this in 2008, and we could be on the verge of seeing this happen again.

If no agreement can be reached and Greece does leave the eurozone, the euro is going to fall off a cliff.

When that happens, someone out there is going to lose an extraordinary amount of money.

And just like in 2008, when the big financial institutions start to fail that will plunge the entire planet into another major financial crisis.

So at the moment, it is absolutely imperative that Greece and the rest of the eurozone find some common ground.

Unfortunately, that may not happen. The new prime minister of Greece certainly does not sound like he is in a compromising mood…

Greece’s new leftist prime minister, Alexis Tsipras, said on Sunday he would not accept an extension to Greece’s current bailout, setting up a clash with EU leaders – who want him to do just that – at a summit on Thursday.

Tsipras also pledged his government would heal the “wounds” of austerity, sticking to campaign pledges of giving free food and electricity to those who had suffered, and reinstating civil servants who had been fired as part of bailout austerity conditions.

Prior to the summit on Thursday, eurozone finance ministers are going to get together on Wednesday to discuss what they should do. If these two meetings don’t go well this week, we could be looking at big trouble right around the corner. In fact, Greece is being warned that they only have until February 16th to apply for an extension of the current bailout…

Euro zone finance ministers will discuss how to proceed with financial support for Athens at a special session next Wednesday ahead of the first summit of EU leaders with the new Greek prime minister, Alexis Tsipras, the following day.

However, the chairman of the finance ministers said the following meeting of the Eurogroup on Feb. 16 would be Greece’s last chance to apply for a bailout extension because some euro zone countries would need to consult their parliaments.

“Time will become very short if they (Greece) don’t ask for an extension (by then),” said Jeroen Dijsselbloem.

The current bailout for Greece expires on Feb 28. Without it the country will not get financing or debt relief from its lenders and has little hope of financing itself in the markets.

And as I mentioned above, the Greek government is quickly running out of money.

Most analysts believe that because of the enormous stakes that one side or the other will give in at some point.

But what if that does not happen?

Personally, I believe that the eurozone is doomed in the configuration that we see it today, and that it is just a matter of time before it breaks up.

And I am far from alone. For example, just check out what former Fed chairman Alan Greenspan is saying…

Mr Greenspan, chairman of the Federal Reserve from 1987 to 2006, said: “I believe [Greece] will eventually leave. I don’t think it helps them or the rest of the eurozone – it is just a matter of time before everyone recognizes that parting is the best strategy.

“The problem is that there there is no way that I can conceive of the euro of continuing, unless and until all of the members of eurozone become politically integrated – actually even just fiscally integrated won’t do it.”

The Greeks are using all of this to their advantage. They know that if they leave it could break apart the entire monetary union. So this gives them a tremendous amount of leverage. Greek Finance Minister Yanis Varoufakis has even gone so far as to compare the eurozone to a house of cards…

“The euro is fragile, it’s like building a castle of cards, if you take out the Greek card the others will collapse.” Varoufakis said according to an Italian transcript of the interview released by RAI ahead of broadcast.

The euro zone faces a risk of fragmentation and “de-construction” unless it faces up to the fact that Greece, and not only Greece, is unable to pay back its debt under the current terms, Varoufakis said.

“I would warn anyone who is considering strategically amputating Greece from Europe because this is very dangerous,” he said. “Who will be next after us? Portugal? What will happen when Italy discovers it is impossible to remain inside the straitjacket of austerity?”

After all this time and after so many bailouts, we have finally reached a day of reckoning.

There is a very real possibility that Greece could leave the eurozone in just a matter of months, and the elite know this.

That is why they are getting prepared for that eventuality. The following is from a recent Wall Street Journal report…

The U.K. government is stepping up contingency planning to prepare for a possible Greek exit from the eurozone and the market instability such a move would create, U.K. Treasury chief George Osborne said on Sunday.

A spokeswoman for the Treasury declined comment on the details of the contingency planning.

The U.K. government has said the standoff between Greece’s new anti-austerity government and the eurozone is increasing the risks to the global and U.K. economy.

“That’s why I’m going tomorrow to the G-20 [Group of 20] to encourage our partners to resolve this crisis. It’s why we’re stepping up the contingency planning here at home,” Mr. Osborne told the BBC in an interview. “We have got to make sure we don’t, at this critical time when Britain is also facing a critical choice, add to the instability abroad with instability at home.”

And if Greece does leave, it will cause panic throughout global financial markets as everyone wonders who is next.

Italy, Spain and Portugal are all in a similar position. Every one of them could rapidly become “the next Greece”.

But of even greater concern is what a “Grexit” would do to the euro. If the euro falls below parity with the U.S. dollar, the derivatives losses are going to be absolutely mind blowing. And coupled with the collapse of the price of oil, we could be looking at some extreme financial instability in the not too distant future.

When big banks collapse, they don’t do it overnight. But we often learn about it in a single moment.

Just remember Lehman Brothers. Their problems developed over an extended period of time, but we only learned the full extent of their difficulties on one very disturbing day in 2008, and that day changed the world.

As you read this, big financial troubles are brewing in the background. At some point, they are going to come to the surface. When they do, the entire planet is going to be shocked.

The Japanese Financial System Is Beginning To Spin Wildly Out Of Control

May 27, 2013 by Michael

The financial system of the third largest economy on the planet is starting to come apart at the seams, and the ripple effects are going to be felt all over the globe. Nobody knew exactly when the Japanese financial system was going to begin to implode, but pretty much everyone knew that a day of reckoning for Japan was coming eventually. After all, the Japanese economy has been in a slump for over a decade, Japan has a debt to GDP ratio of well over 200 percent and they are spending about 50 percent of all tax revenue on debt service. In a desperate attempt to revitalize the economy and reduce the debt burden, the Bank of Japan decided a few months ago to start pumping massive amounts of money into the economy. At first, it seemed to be working. Economic activity perked up and the Japanese stock market went on a tremendous run. Unfortunately, there is also a very significant downside to pumping your economy full of money. Investors start demanding higher returns on their money and interest rates go up. But the Japanese government cannot afford higher interest rates. Without super low interest rates, Japanese government finances would totally collapse. In addition, higher interest rates in the private sector would make it much more difficult for the Japanese economy to expand. In essence, pretty much the last thing that Japan needs right now is significantly higher interest rates, but that is exactly what the policies of the Bank of Japan are going to produce.

There is a lot of fear in Japan right now. On Thursday, the Nikkei plunged 7.3 percent. That was the largest single day decline in more than two years. Then on Monday the index fell by another 3.2 percent.

And according to Business Insider, things are not looking good for Tuesday at this point…

In post-close futures trading, the Nikkei has dropped by another couple hundred points, and has dropped below 14,000.

Are we witnessing the beginning of a colossal financial meltdown by the third largest economy on the planet? The Bank of Japan is starting to lose control, and if Japan goes down hard the crisis could spread to Europe and North America very rapidly. The following is from a recent article by Graham Summers…

As Japan has indicated, when bonds start to plunge, it’s not good for stocks. Today the Japanese Bond market fell and the Nikkei plunged 7%. The entire market down 7%… despite the Bank of Japan funneling $19 billion into it to hold things together.

This is what it looks like when a Central Bank begins to lose control. And what’s happening in Japan today will be coming to the US in the not so distant future.

If you think the Fed is not terrified of this, think again. The Fed has pumped over $1 trillion into foreign banks, hoping to stop the mess from getting to the US. As Japan is showing us, the Fed will fail.

Investors, take note… the financial system is sending us major warnings…

If you are not already preparing for a potential market collapse, now is the time to be doing so.

And all of this money printing is absolutely crushing the Japanese yen. Since the start of 2013, the yen has declined 16 percent against the U.S. dollar, even though the U.S. dollar is also being rapidly debased. Just check out this chart of the yen vs. the U.S. dollar. It is absolutely stunning…

The term “currency war” is something that you are going to hear a lot more over the next few years, and what you can see in the chart above is only the beginning.

What the Bank of Japan is doing right now is absolutely unprecedented. It has announced that it plans to inject the equivalent of approximately $1.4 trillion into the Japanese economy in less than two years.

As Kyle Bass recently discussed, that dwarfs the quantitative easing that the Federal Reserve has been doing…

“What they’re doing represents 70% of what the Fed is doing here with an economy 1/3 the size of ours”

The big problem for Japan will come when government bond yields really start to rise. The yield on 10 year government bonds has been creeping up over the past few months, and if they hit the 1.0% mark that will set off some major red flags.

Because Japan has a debt to GDP ratio of more than 200 percent, the only way that it can avoid a total meltdown of government finances is to have super low interest rates. The video posted below does a great job of elaborating on this point…

It really is very simple. If interest rates rise substantially, Japan will be done.

Investor Kyle Bass is one of those that have been warning about this for a long time…

There’s a fatalism, he says, in everyone he talks to in Japan. Their thinking is changing, and the way they talk to him about debt is changing. They already spend 50% of tax revenue on debt service.

“If rates go up, it’s game over.”

The financial problems in Cyprus and Greece are just tiny blips compared to what a major financial crisis in Japan would potentially be like. The Japanese economy is larger than the economies of Germany and Italy combined. If the house of cards in Japan comes tumbling down, trillions of dollars of investments all over the globe are going to be affected.

And what is happening right now in Japan should serve as a sober warning to the United States. Like Japan, the money printing that the Federal Reserve has been doing has caused economic activity to perk up a bit and it has sent the stock market on an unprecedented run.

Unfortunately, no bubble that the Federal Reserve has ever created has been able to last forever. At some point, we will pay a very great price for all of the debt that the U.S. government has been accumulating and all of the reckless money printing that the Fed has been engaged in.

So enjoy the calm before the storm while you still can.

It won’t last for long.

The Sovereign Debt Bubble Will Continue To Expand Until – BANG – The System Implodes

January 20, 2013 by Michael

Why are so many politicians around the world declaring that the debt crisis is “over” when debt to GDP ratios all over the planet continue to skyrocket? The global economy has never seen anything like the sovereign debt bubble that we are experiencing today. The United States, Japan, and nearly every major nation in Europe are absolutely drowning in debt. We have heard a lot about “austerity” over in Europe in recent years, but debt to GDP ratios continue to rise in Greece, Spain, Italy, Ireland and Portugal. In general, most economists consider a debt to GDP ratio of 100% to be a “danger level”, and most of the economies of the western world have either already surpassed that level or are rapidly approaching it. Of course the biggest debt offender of all in many ways is the United States. The U.S. debt to GDP ratio has risen from 66.6 percent to 103 percent since 2007, and the U.S. government accumulated more new debt during Barack Obama’s first term than it did under the first 42 U.S. presidents combined. This insane sovereign debt bubble will continue to expand until a day of reckoning arrives and the system implodes. Nobody knows exactly when that moment will be reached, but without a doubt it is coming.

But if you listen to the mainstream media in the United States, you would be tempted to think that this giant bubble of debt is not much of a concern at all. For example, in a recent article in the Washington Post entitled “The case for deficit optimism“, Ezra Klein wrote the following…

“Here’s a secret: For all the sound and fury, Washington’s actually making real progress on debt.”

How many times have we heard that before?

About a decade ago, government officials were projecting that we would be swimming in gigantic government surpluses by now.

Instead, we are running trillion dollar deficits.

But right now there is a lot of optimism about the economy. The stock market recently hit a 5 year high and the business community is loving all of the false prosperity that all of this debt is buying us.

Even Warren Buffett does not really seem concerned about the exploding U.S. government debt. He recently made the following statement…

“It is not a good thing to have it going up in relation to GDP. That should be stabilized. But the debt itself is not a problem.”

Oh really?

A debt of 16 trillion dollars “is not a problem”?

Perhaps we should all run our finances that way.

Why don’t we all go out and open up 20 different credit cards, run them all up to the max, and then tell the credit card companies that we can’t pay them back but that it “is not a problem”.

Of course real life does not work that way.

The truth is that government debt is becoming a monstrous problem all over the globe. Just check out how debt to GDP ratios all over the planet have grown over the past five years…

United States

Debt to GDP ratio in 2007: 66.6 percent

Debt to GDP ratio in 2012: 103 percent

United Kingdom

Debt to GDP ratio in 2007: 43.4 percent

Debt to GDP ratio in 2012: 85.0 percent

France

Debt to GDP ratio in 2007: 63.7 percent

Debt to GDP ratio in 2012: 86 percent

Germany

Debt to GDP ratio in 2007: 67.6 percent

Debt to GDP ratio in 2012: 80.5 percent

Spain

Debt to GDP ratio in 2007: 39.6 percent

Debt to GDP ratio in 2012: 69.3 percent

Ireland

Debt to GDP ratio in 2007: 24.8 percent

Debt to GDP ratio in 2012: 106.4 percent

Portugal

Debt to GDP ratio in 2007: 63.9 percent

Debt to GDP ratio in 2012: 108.1 percent

Italy

Debt to GDP ratio in 2007: 106.6 percent

Debt to GDP ratio in 2012: 120.7 percent

Greece

Debt to GDP ratio in 2007: 106.1 percent

Debt to GDP ratio in 2012: 170.6 percent

The Eurozone As A Whole

Debt to GDP ratio in 2007: 68.4 percent

Debt to GDP ratio in 2012: 87.3 percent

Japan

Debt to GDP ratio in 2007: 172.1 percent

Debt to GDP ratio in 2012: 211.7 percent

So how does all of this end?

Well, it is going to be messy, but it is very difficult to say exactly when the system will collapse under the weight of too much debt. Some nations, such as Japan, are able to handle very high debt loads because they have a very high level of domestic saving. Up to this point, an astounding 95 percent of all Japanese government bonds have been purchased domestically. But other nations collapse under the weight of government debt even before they reach a debt to GDP ratio of 100%. The following is an excerpt from a recent Congressional Research Service report…

It is hard to predict at what point bond holders would deem it to be unsustainable. A few other advanced economies have debt-to-GDP ratios higher than that of the United States. Some of those countries in Europe have recently seen their financing costs rise to the point that they are unable to finance their deficits solely through private markets. But Japan has the highest debt-to-GDP ratio of any advanced economy, and it has continued to be able to finance its debt at extremely low costs.

When a government runs up massive amounts of debt, it is playing with fire. You can pile up mountains of government debt for a while, but eventually it catches up with you.

Over the past 10 years, the U.S. national debt has grown by an average of 9.3 percent per year, but the overall U.S. economy has only grown by an average of just 1.8 percent per year. That is unsustainable by definition.

There is going to be a tremendous price to pay for the debt binge that the U.S. government has indulged in over the past decade. During Barack Obama’s first term, the amount of new debt accumulated by the federal government breaks down to about $50,521 for every single household in the United States. That is utter insanity.

If you can believe it, we have accumulated more new government debt under Obama than we did from the inauguration of George Washington to the end of the Clinton administration.

And most Americans realize that something is seriously wrong. One recent poll found that only 34 percent of all Americans believe that the country is heading in the right direction, and 60 percent of all Americans believe that the country is heading in the wrong direction.

If we keep piling up so much debt, at some point a moment of great crisis will arrive. When that moment arrives, we could see havoc throughout the entire global financial system. For instance, most people don’t really understand the key role that U.S. Treasuries play in the derivatives market. The following is from a recent article posted on Zero Hedge…

This time around, things will be far worse if nothing is solved. If the US loses another AAA rating, then the financial markets could face systemic risk. The reason for this is that US Treasuries are one of the senior most forms of collateral used by the banks to backstop the $600+ trillion derivatives market.

As any trader who trades on margin can tell you, when the value of your collateral is called into question, those on the other side of the trade come looking for you to put up more capital on your trades. This can result in assets being sold en masse (similar to what happened after Lehman failed) and things can get very ugly very fast.

For much more on the danger that derivatives pose to our financial system, please see this article: “The Coming Derivatives Panic That Will Destroy Global Financial Markets“.

Once again, nobody knows exactly when the sovereign debt bubble will burst, but if we continue down the path that we are currently on, it will inevitably happen at some point.

And according to Professor Carmen Reinhart, when this bubble does burst things could unravel very rapidly…

“These processes are not linear,” warns Prof. Reinhart. “You can increase debt for a while and nothing happens. Then you hit the wall, and—bang!—what seem to be minor shocks that the markets would shrug off in other circumstances suddenly become big.”

At some point the global financial system will hit the wall that Professor Reinhart has warned about.

Are you ready?

34 Signs That America Is In Decline

November 29, 2012 by Michael

The United States is clearly in an advanced state of decline. Many people around the world (and even inside America) rejoice at this, but not me. I mourn for the country that I was born in and that I still love. Yes, the United States has never been perfect, but the Republic that our Founding Fathers started truly has been a light to the rest of the world in a lot of ways over the centuries. Unfortunately, our foundations are badly rotting and our nation is collapsing all around us. Many Americans like to think that the United States is greater today than it has ever been before, but the truth is that America is like a patient that has stage 4 cancer that has spread to almost every area of the body. Our nation is being destroyed in thousands of different ways, and more distressing news emerges with each passing day. This article will mainly focus on the economic decline of America, but much could also be said about our social, political, moral and spiritual decline as well. We are simply not the same country that we used to be. Americans are proud, selfish, greedy, arrogant, ungrateful, treacherous and completely addicted to entertainment and pleasure. Our country is literally falling apart all around us, but most Americans are so plugged into entertainment that they can’t even be bothered to notice what is happening. Most Americans seem to assume that we will always have endless prosperity just because of who we are, but unfortunately that simply is not true. We inherited the greatest economic machine the world has ever seen and we have wrecked it, and now a very painful day of reckoning is approaching. But most people will not understand until it is too late.

The following are 34 signs that America is in decline…

#1 According to the World Bank, U.S. GDP accounted for 31.8 percent of all global economic activity in 2001. That number dropped to 21.6 percent in 2011. That is not just a decline – that is a freefall. Just check out the chart in this article.

#2 According to The Economist, the United States was the best place in the world to be born into back in 1988. Today, the United States is only tied for 16th place.

#3 The United States has fallen in the global economic competitiveness rankings compiled by the World Economic Forum for four years in a row.

#4 According to the Wall Street Journal, of the 40 biggest publicly traded corporate spenders, half of them plan to reduce capital expenditures in coming months.

#5 More than three times as many new homes were sold in the United States in 2005 as will be sold in 2012.

#6 America once had the greatest manufacturing cities on the face of the earth. Now many of our formerly great manufacturing cities have degenerated into festering hellholes. For example, the city of Detroit is on the verge of financial collapse, and one state lawmaker is now saying that “dissolving Detroit” should be looked at as an option.

#7 In 2007, the unemployment rate for the 20 to 29 age bracket was about 6.5 percent. Today, the unemployment rate for that same age group is about 13 percent.

#8 Back in 1950, more than 80 percent of all men in the United States had jobs. Today, less than 65 percent of all men in the United States have jobs.

#9 If you can believe it, approximately one out of every four American workers makes 10 dollars an hour or less.

#10 Sadly, 60 percent of the jobs lost during the last recession were mid-wage jobs, but 58 percent of the jobs created since then have been low wage jobs.

#11 Median household income in America has fallen for four consecutive years. Overall, it has declined by over $4000 during that time span.

#12 The U.S. trade deficit with China during 2011 was 28 times larger than it was back in 1990.

#13 Incredibly, more than 56,000 manufacturing facilities in the United States have been shut down since 2001. During 2010, manufacturing facilities were shutting down at the rate of 23 per day. How can anyone say that “things are getting better” when our economic infrastructure is being absolutely gutted?

#14 Back in early 2005, the average price of a gallon of gasoline was less than 2 dollars a gallon. During 2012, the average price of a gallon of gasoline has been $3.63.

#15 In 1999, 64.1 percent of all Americans were covered by employment-based health insurance. Today, only 55.1 percent are covered by employment-based health insurance.

#16 As I have written about previously, 61 percent of all Americans were “middle income” back in 1971 according to the Pew Research Center. Today, only 51 percent of all Americans are “middle income”.

#17 There are now 20.2 million Americans that spend more than half of their incomes on housing. That represents a 46 percent increase from 2001.

#18 According to the U.S. Census Bureau, the poverty rate for children living in the United States is about 22 percent.

#19 Back in 1983, the bottom 95 percent of all income earners in the United States had 62 cents of debt for every dollar that they earned. By 2007, that figure had soared to $1.48.

#20 Total home mortgage debt in the United States is now about 5 times larger than it was just 20 years ago.

#21 Total credit card debt in the United States is now more than 8 times larger than it was just 30 years ago.

#22 The value of the U.S. dollar has declined by more than 96 percent since the Federal Reserve was first created.

#23 According to one survey, 29 percent of all Americans in the 25 to 34 year old age bracket are still living with their parents.

#24 Back in 1950, 78 percent of all households in the United States contained a married couple. Today, that number has declined to 48 percent.

#25 According to the U.S. Census Bureau, 49 percent of all Americans live in a home that receives direct monetary benefits from the federal government. Back in 1983, less than a third of all Americans lived in a home that received direct monetary benefits from the federal government.

#26 In 1980, government transfer payments accounted for just 11.7 percent of all income. Today, government transfer payments account for more than 18 percent of all income.

#27 In November 2008, 30.8 million Americans were on food stamps. Today, 47.1 million Americans are on food stamps.

#28 Right now, one out of every four American children is on food stamps.

#29 As I wrote about the other day, according to one calculation the number of Americans on food stamps now exceeds the combined populations of “Alaska, Arkansas, Connecticut, Delaware, District of Columbia, Hawaii, Idaho, Iowa, Kansas, Maine, Mississippi, Montana, Nebraska, Nevada, New Hampshire, New Mexico, North Dakota, Oklahoma, Oregon, Rhode Island, South Dakota, Utah, Vermont, West Virginia, and Wyoming.”

#30 Back in 1965, only one out of every 50 Americans was on Medicaid. Today, one out of every 6 Americans is on Medicaid, and things are about to get a whole lot worse. It is being projected that Obamacare will add 16 million more Americans to the Medicaid rolls.

#31 In 2001, the U.S. national debt was less than 6 trillion dollars. Today, it is over 16 trillion dollars and it is increasing by more than 100 million dollars every single hour.

#32 The U.S. national debt is now more than 23 times larger than it was when Jimmy Carter became president.

#33 According to a PBS report from earlier this year, U.S. households that make $13,000 or less per year spend 9 percent of their incomes on lottery tickets. Could that possibly be accurate? Are people really that foolish?

#34 As the U.S. economy has declined, the American people have been downing more antidepressants and other prescription drugs than ever before. In fact, the American people spent 60 billion dollars more on prescription drugs in 2010 than they did in 2005.

So what are our “leaders” doing about all of this?

Not much.

They just continue to insist that everything is “just fine”.

Sadly, the truth is that they live in a world that is very different from most of the rest of us.

Barack Obama is getting ready to take a 20 day vacation to Hawaii.

When was the last time you got to take a 20 day vacation?

And most of our “leaders” have no idea what it is like to struggle from month to month on a paycheck.

Overall, more than half of the members of Congress are millionaires. We are led by wealthy men who are serving the interests of other wealthy men.

But the problem with our system is not limited to the president and the members of Congress. The truth is that the political system in America has become a colossal beast that just continues to grow no matter who is in power. The political establishment of both parties is totally dependent on this beast, and they will continue to feed it and serve it because it has been very good to them. The following is from an outstanding article by Steve McCann…

The Republican and Democratic political establishments are made up of the following:

1) many current and nearly all retired national office holders whose livelihood and narcissistic demands depends upon fealty to Party and access to government largesse;

2) the majority of the media elite, including pundits, editors, writers and television news personalities based in Washington and New York whose proximity to power and access is vital to their continued standard of living;

3) academia, numerous think-tanks, so-called non-government organizations, and lobbyists who fasten onto those in the administration and Congress for employment, grants, favorable legislation and ego-gratification;

4) the reliable deep pocket political contributors and political consultants whose future is irrevocably tied to the political machinery of the Party; and

5) the crony capitalists, i.e. leaders of the corporate and financial community as well as unions whose entities are dependent on or subject to government oversight and/or benevolence .

Do you think that there is any chance that this insidious system will be uprooted any time soon?

Of course not.

We will continue on the same path that we are on right now and America will continue to decline.

Many will rejoice as America falls, but I will not.

I will mourn for a mighty Republic that has fallen and for a dream that has been lost.

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