Global Economy

Who Controls The Global Economy? Do Not Underestimate The Power Of The Big Banks

July 24, 2013July 24, 2013 by Michael

Are the big banks really as powerful as some people say that they are? Do they really control the global economy? If y0u asked most people, they would tell you that governments control the global economy. But the campaigns of our politicians are funded by the ultra-wealthy, the big banks and the large corporations that they control. Others would tell you that the Federal Reserve and the rest of the central banks around the world control the global economy. But the truth is that the Federal Reserve was established by the bankers and for the benefit of the bankers. As you will see below, at the very core of the global economy there exists a “super-entity” of financial institutions that control an almost unimaginable amount of wealth and power. These financial institutions and the ultra-wealthy individuals behind them are really the ones that are pulling all the strings. In this world money equals power, and the borrower is the servant of the lender. When you follow the pyramid all the way to the top, it begins to become very clear who really is in control.

In business schools all over America today, instead of dreaming of starting new businesses and contributing something positive to society, most business students are dreaming of going to Wall Street and getting rich. But Wall Street doesn’t actually create or build anything of value for society. Instead, the bankers make most of their profits by essentially pushing money and paper around. In a recent article, Chris Martenson commented on this…

Today, some of the most celebrated individuals and institutions are ensconced within the financial industry; in banks, hedge funds, and private equity firms. Which is odd because none of these firms or individuals actually make anything, which society might point to as additive to our living standards. Instead, these financial magicians harvest value from the rest of society that has to work hard to produce real things of real value.

While the work they do is quite sophisticated and takes a lot of skill, very few of these firms direct capital to new efforts, new products, and new innovations. Instead they either trade in the secondary markets for equities, bonds, derivatives, and the like, which perform the ‘service’ of moving paper from one location to another while generating ‘profits.’ Or, in the case of banks, they create money out of thin air and lend it out – at interest of course.

But just because they aren’t adding much value to society does not mean that these big banks are not extremely powerful. In fact, anyone that underestimates that power of these monolithic financial institutions is being quite foolish.

A team of researchers at the Swiss Federal Institute of Technology in Zurich studied the relationships between 37 million companies and investors worldwide, and what they found was absolutely stunning.

What they discovered is that there is a “super-entity” of just 147 very tightly knit companies that controls 40 percent of the entire network…

When the team further untangled the web of ownership, it found much of it tracked back to a “super-entity” of 147 even more tightly knit companies – all of their ownership was held by other members of the super-entity – that controlled 40 per cent of the total wealth in the network. “In effect, less than 1 per cent of the companies were able to control 40 per cent of the entire network,” says Glattfelder. Most were financial institutions. The top 20 included Barclays Bank, JPMorgan Chase & Co, and The Goldman Sachs Group.

So exactly who are the companies that are at the core of this “super-entity”?

Well, almost all of them are banks or financial institutions. The following is a list of the 50 “most connected” companies from the study, and the notes in parentheses are from Chris Martenson…

1. Barclays plc
2. Capital Group Companies Inc (Investment Management)
3. FMR Corporation (Financial Services)
4. AXA (Investments & Life Insurance)
5. State Street Corporation (Investment Management)
6. JP Morgan Chase & Co (Bank)
7. Legal & General Group plc (Investments & Life Insurance)
8. Vanguard Group Inc (Investment Management)
9. UBS AG (Bank)
10. Merrill Lynch & Co Inc (Bank)
11. Wellington Management Co LLP (Investment Management)
12. Deutsche Bank AG (Bank)
13. Franklin Resources Inc (Investment Management)
14. Credit Suisse Group (Bank)
15. Walton Enterprises LLC
16. Bank of New York Mellon Corp (Bank)
17. Natixis (Investment Management)
18. Goldman Sachs Group Inc (Bank)
19. T Rowe Price Group Inc (Investment Management)
20. Legg Mason Inc (Investment Management)
21. Morgan Stanley (Bank)
22. Mitsubishi UFJ Financial Group Inc (Bank)
23. Northern Trust Corporation (Investment Management)
24. Société Générale (Bank)
25. Bank of America Corporation (Bank)
26. Lloyds TSB Group plc (Bank)
27. Invesco plc (Investment mgmt) 28. Allianz SE 29. TIAA (Investments & Insurance)
30. Old Mutual Public Limited Company (Investments & Insurance)
31. Aviva plc (Insurance)
32. Schroders plc (Investment Management)
33. Dodge & Cox (Investment Management)
34. Lehman Brothers Holdings Inc* (Bank)
35. Sun Life Financial Inc (Investments & Insurance)
36. Standard Life plc (Investments & Insurance)
37. CNCE
38. Nomura Holdings Inc (Investments and Financial Services)
39. The Depository Trust Company (Securities Depository)
40. Massachusetts Mutual Life Insurance
41. ING Groep NV (Bank, Investments & Insurance)
42. Brandes Investment Partners LP (Financial Services)
43. Unicredito Italiano SPA (Bank)
44. Deposit Insurance Corporation of Japan (Owns a lot of banks’ shares in Japan)
45. Vereniging Aegon (Investments & Insurance)
46. BNP Paribas (Bank)
47. Affiliated Managers Group Inc (Owns stakes in 27 money management firms)
48. Resona Holdings Inc (Banking Group in Japan)
49. Capital Group International Inc (Investments and Financial Services)
50. China Petrochemical Group Company

Are you starting to get the idea?

The global economy truly is completely dominated by banks and other financial institutions.

In the United States, the big banks are not just content to own other companies anymore. Now, some of our largest banks are actually starting to directly get into businesses such as “electric power production, oil refining and distribution, owning and operating of public assets such as ports and airports, and even uranium mining”. The following is an excerpt from a letter that several members of the U.S. Congress recently sent to Federal Reserve Chairman Ben Bernanke…

We write in regards to the expansion of large banks into what had traditionally been non-financial commercial spheres. Specifically, we are concerned about how large banks have recently expanded their businesses into such fields as electric power production, oil refining and distribution, owning and operating of public assets such as ports and airports, and even uranium mining.

Here are a few examples. Morgan Stanley imported 4 million barrels of oil and petroleum products into the United States in June, 2012. Goldman Sachs stores aluminum in vast warehouses in Detroit as well as serving as a commodities derivatives dealer. This “bank” is also expanding into the ownership and operation of airports, toll roads, and ports. JP Morgan markets electricity in California.

In other words, Goldman Sachs, JP Morgan, and Morgan Stanley are no longer just banks – they have effectively become oil companies, port and airport operators, commodities dealers, and electric utilities as well. This is causing unforeseen problems for the industrial sector of the economy. For example, Coca Cola has filed a complaint with the London Metal Exchange that Goldman Sachs was hoarding aluminum. JP Morgan is currently being probed by regulators for manipulating power prices in California, where the “bank” was marketing electricity from power plants it controlled. We don’t know what other price manipulation could be occurring due to potential informational advantages accruing to derivatives dealers who also market and sell commodities. The long shadow of Enron could loom in these activities.

You can read the rest of their letter right here.

This week, Goldman Sachs has been facing allegations that it has cost American consumers billions of dollars by manipulating the price of aluminum. The following is from an article that was posted on CNBC…

Hundreds of millions of times a day, thirsty Americans open a can of soda, beer or juice. And every time they do it, they pay a fraction of a penny more because of a shrewd maneuver by Goldman Sachs and other financial players that ultimately costs consumers billions of dollars.

The story of how this works begins in 27 industrial warehouses in the Detroit area where Goldman stores customers’ aluminum. Each day, a fleet of trucks shuffles 1,500-pound bars of the metal among the warehouses. Two or three times a day, sometimes more, the drivers make the same circuits. They load in one warehouse. They unload in another. And then they do it again.

This industrial dance has been choreographed by Goldman to exploit pricing regulations set up by an overseas commodities exchange, an investigation by The New York Times has found. The back–and-forth lengthens the storage time. And that adds many millions a year to the coffers of Goldman, which owns the warehouses and charges rent to store the metal. It also increases prices paid by manufacturers and consumers across the country.

If that sounds shady to you, that is because it is shady.

But as the big banks continue to gain even more power in our society, this kind of thing will become even more common.

So what can we do about it?

Not much.

Do you think that the media will tell us the truth about all of this? I wouldn’t count on it. At this point, there are just six giant media corporations that control more than 90 percent of the news and entertainment that you see on your television. And those six giant media corporations are very hesitant to do anything that will damage their corporate owners or their corporate advertisers.

Do you think that our politicians will do anything about all of this? I wouldn’t count on it. In national elections, the candidate that raises more money wins more than 80 percent of the time. Our politicians know where their bread is buttered, and as history has shown most of them are very good to the guys with the big checkbooks.

As I said at the top of this article, money is power, and according to a report that was released last summer, the global elite have up to 32 TRILLION dollars stashed in offshore banks around the globe.

The global economy belongs to them. We are just living in it.

But hopefully if enough people start waking up, someday we will see some significant changes.

One of my favorite musical artists of all-time, Michael W. Smith, once wrote a song that contained the following lyrics…

Tell me, how long will we grovel at the feet of wealth and power?

Tell me, how long will we bow down to that golden calf, now?

(How long will be too long)

Will the people of the world ever get sick and tired of the overwhelming power of the big banks and start demanding changes?

That is a very good question. Please feel free to share what you think by posting a comment below…

Worldwide Unemployment Crisis: There Are 93 Million Unemployed Workers In G20 Nations

July 19, 2013July 19, 2013 by Michael

Did you know that the total number of unemployed workers in G20 counties is now up to 93 million and that it is increasing with each passing day? You see, the truth is that the United States is not the only one dealing with a systemic unemployment crisis. This is literally happening all over the planet. So what is causing this crisis? Is there any hope that it will be turned around? Well, unfortunately there are several long-term trends that have been developing for decades that have played a major role in bringing us to this point. First of all, the giant corporations that now totally dominate the global economy have figured out that they can make a lot more money by replacing expensive workers that live in major industrialized nations with workers that live in nations where it is legal to pay slave labor wages. So it isn’t really a huge mystery why there is such a huge problem with unemployment in the western world. If you were running a giant corporation, why would you want to hire workers that will cost you 10 to 20 times as much as other workers? A worker is a worker, and over the past decade we have seen a massive movement of jobs to countries where labor is cheaper. In addition, large corporations are also trying to completely eliminate as many jobs as they can by using technology. If a corporation can get a computer or a machine or a robot to do a task more cheaply than a human worker can do it, then why would that corporation want to continue to rely on human labor? And of course we have seen an overall weakening of the economies of the western world in recent years as well. This has been particularly true in the United States. As these long-term trends intensify, the worldwide unemployment crisis is going to get even worse.

In fact, the director general of the International Labor Organization is fully convinced that unemployment is going to continue to rise in G20 nations. Just check out what he told CNBC on Friday…

Unemployment will likely soar further in the group of 20 major economic powers without immediate action, Guy Ryder, the director general of the International Labor Organization told CNBC on Friday, comparing the jobs crisis to the 2008-2009 financial crisis and warning it needs to be tackled urgently.

“We have gone backwards. It is quite alarming to see…that unemployment has not gone down, in fact it’s gone up,” Ryder told CNBC at the G20 finance ministers’ meeting in Moscow.

He said 93 million people were currently unemployed in the G20.

And when those living in G20 nations lose their jobs, they tend to stay out of work for a very long time. In fact, 30 percent of unemployed workers in G20 countries have been out of work for one year or longer.

Major industrialized nations all over the planet are no longer able to produce enough jobs for their people. In many “wealthy nations” the unemployment rate has already risen well up into double digits. Just consider the following numbers…

-The unemployment rate is above 25 percent in South Africa.

-The unemployment rate in France recently hit a 15 year high.

-The unemployment rate in Italy is up to 12.2 percent, which is the highest in 35 years.

-The unemployment rate in the eurozone as a whole is up to an all-time high of 12.2 percent.

-The unemployment rate in Poland is 13.2 percent.

-The unemployment rate in Ireland is now 13.6 percent.

-The unemployment rate in Portugal has rocketed up to 17.7 percent.

-The unemployment rate in Greece is currently sitting at 26.9 percent and it is being projected that it will soon hit 30 percent.

-The unemployment rate in Spain is even worse than in Greece. The unemployment rate in Spain is a staggering 27.2 percent.

Sadly, it looks like things are not going to be getting better any time soon. In fact, global business confidence is now the lowest that it has been since the last recession.

So what about the United States?

Well, it is true that our official numbers do not look quite as bad as much of the rest of the world. But the official unemployment rate in the U.S. has been at 7.5 percent or higher for 54 months in a row. That is the longest stretch in U.S. history.

But at least it is not in double digits yet.

Things could be worse.

However, that does not mean that we are doing well either.

The mainstream media is attempting to convince us that everything is just fine because the unemployment rate has been “going down”, but when you take a deeper look at the numbers that is not exactly an accurate assessment of our situation.

As the New York Times recently pointed out, the decline in the unemployment rate can almost entirely be accounted for by a decline in the labor participation rate…

Let’s take a step back. Lots of people lost jobs during the Great Recession. In the aftermath, the great surprise has been how few are looking for new jobs. Labor force participation, the share of adults working or trying to find work, has stagnated at about 63.5 percent, almost three percentage points below the pre-recession level.

The unemployment rate has dropped almost entirely because of this decline in labor force participation. In other words, it has not fallen because people are finding jobs. It has fallen because fewer people are looking for jobs.

To get a more accurate picture of what is really happening with employment in America, you need to look at the employment-population ratio. It is a measurement of the percentage of the working age population that is actually working. As you can see, the percentage of working age Americans that actually have a job has been declining since the year 2000…

As you can see, there has been no employment recovery.

When the mainstream media tells you that the employment numbers for June were “great”, that is not being honest. The truth is that the unemployment rate rose in 28 U.S. states and it only declined in 11 states during June, and as I mentioned yesterday, the U.S. economy actually lost 240,000 full-time jobs last month.

So no, things are not getting better, and the unemployment problems in the United States and in Europe are likely going to continue to get worse in the years ahead.

That is very bad news for most of us, because the only thing that most of us have to offer in the marketplace is our labor. If the value that is placed on our labor is continually declining, then that puts us in a very difficult position.

It is almost as if we have all been drafted to play a very twisted game of musical chairs. Each time the music stops, more chairs (jobs) are being pulled out of the game.

You might be doing okay for the moment, but what is going to happen when the music suddenly stops one day and your chair gets pulled out of the game?

That is something that you might want to start thinking about.

19 Reasons To Be Deeply Concerned About The Global Economy As We Enter The 2nd Half Of 2013

July 3, 2013 by Michael

Is the global economic downturn going to accelerate as we roll into the second half of this year? There is turmoil in the Middle East, we are seeing things happen in the bond markets that we have not seen happen in more than 30 years, and much of Europe has already plunged into a full-blown economic depression. Sadly, most Americans will never understand what is happening until financial disaster strikes them personally. As long as they can go to work during the day and eat frozen pizza and watch reality television at night, most of them will consider everything to be just fine. Unfortunately, the truth is that everything is not fine. The world is becoming increasingly unstable, we are living in the terminal phase of the greatest debt bubble in the history of the planet and the global financial system is even more vulnerable than it was back in 2008. Unfortunately, most people seem to only have a 48 hour attention span at best these days. They don’t have the patience to watch long-term trends develop. And the coming economic collapse is not going to happen all at once. Rather, it is like watching a very, very slow-motion train wreck happen. The coming economic nightmare is going to unfold over a number of years. Yes, there will be moments of great panic, but mostly it will be a steady decline into economic oblivion. And there are a lot of indications that the second half of this year is not going to be as good as the first half was. The following are 19 reasons to be deeply concerned about the global economy as we head into the second half of 2013…

#1 The velocity of money in the United States has plunged to an all-time low. It is extremely difficult to have an “economic recovery” if banks are not lending money and people are not spending it…

#2 The fall of the Egyptian government threatens to bring even more instability to the Middle East. In response to the events in Egypt, the price of oil rose to more than 101 dollars a barrel on Wednesday.

#3 Every time the average price of a gallon of gasoline in the United States has risen over $3.80 in the past three years, a stock market decline has always followed.

#4 As the world becomes increasingly unstable, massive citizen protest movements have been rising all over the globe…

The protests have many different origins. In Brazil people rose up against bus fares, in Turkey against a building project. Indonesians have rejected higher fuel prices, Bulgarians the government’s cronyism.

In the euro zone they march against austerity, and the Arab spring has become a perma-protest against pretty much everything. Each angry demonstration is angry in its own way.

#5 The European sovereign debt crisis is flaring up once again. This time it is Portugal’s turn to take center stage…

From Greece to Cyprus, Slovenia to Spain and Italy, and now most pressingly Portugal, where the finance and foreign ministers resigned in the space of two days, a host of problems is stirring after 10 months of relative calm imposed by the European Central Bank.

Portuguese Prime Minister Pedro Passos Coelho told the nation in an address late on Tuesday that he did not accept the foreign minister’s resignation and would try to go on governing.

If his government does end up collapsing, as is now more likely, it will raise immediate questions about Lisbon’s ability to meet the terms of the 78-billion-euro bailout it agreed with the EU and International Monetary Fund in 2011.

#6 It is being projected that Italy will need a major EU bailout within six months.

#7 Bond investors are starting to panic. In fact, even prominent firms such as Pimco are seeing investors pull massive amounts of money out right now…

In June, investors pulled $9.6bn from Bill Gross’s flagship fund at Pimco, the largest single month of outflows at the fund since Morningstar records began in 1993, the investment research firm said.

The outflows came after investors pulled $1.3bn from the fund in May, which marked the first outflows since December 2011.

Overall, a whopping 80 billion dollars was pulled out of bond funds during June.

#8 Central banks are selling off staggering amounts of U.S. Treasury bonds right now.

#9 U.S. mortgage bonds just suffered their largest quarterly decline in nearly 20 years.

#10 We continue to buy far more from the rest of the world than they buy from us. The U.S. trade deficit for the month of May was 45.0 billion dollars.

#11 The severe drought that the western half of the United States is suffering never seems to end. What will it do to food prices if ranchers and farmers out west have to go through another summer like they did last year?

#12 European car sales have fallen to a 20 year low.

#13 Unemployment in the eurozone is at an all-time high.

#14 Could the paper gold Ponzi scheme be on the verge of crumbling? There are reports that there is now a 100 day delay for gold owners to take physical delivery of their gold from some warehouses owned by the London Metal Exchange…

We’re told that bullion-buyers in London must now wait more than 100 days to take delivery of the bullion for which they have already paid.

The comedic drones at Bloomberg, and officials of the London Metal Exchange itself would have us believe this is due to “warehouse queues.” While precious metals bulls undoubtedly appreciate the imagery implied of a 100-day line-up of armored cars waiting to load their bullion – in the middle of this “bear market” – the implication is fallacious.

In an era of just-in-time inventories; the notion that there can be a 100-day backlog to load bullion into armored cars with the metal already sitting in the warehouse is ludicrous. Clearly what the LME is really reporting here is a greater-than-three-month delay to refine the gold (or silver) being purchased here – and then ship it to their warehouse.

In other words, the “bullion” which traders believe they are purchasing today is in fact merely ore which hasn’t even been dug out of the ground yet.

#15 The number of mortgage applications in the United States is falling at the fastest rate in more than 3 years.

#16 Real disposable income in the United States is falling at the fastest rate in more than 4 years.

#17 The percentage of companies issuing negative earnings guidance for this quarter is at a level that we have never seen before.

#18 Is the dark side of derivatives trading about to be exposed? EU officials claim that 13 major international banks have been colluding to control the trading of derivatives…

The European Commission says many of the world’s largest investment banks appear to have colluded to block attempts by exchanges to trade and offer more transparent prices for financial products known as credit derivatives.

The commission, the executive arm of the European Union, said Monday it has informed 13 banks — including Citigroup, Goldman Sachs, JPMorgan and Morgan Stanley — as well as the industry association for derivatives itself, the International Swaps and Derivatives Association, ISDA, of the preliminary conclusions of an investigation that began in March.

#19 There are 441 trillion dollars of interest rate derivatives sitting out there and interest rates have risen rapidly over the past few weeks. What is going to happen to those derivatives if interest rates keep going higher?

So what do you think?

Are there any items that are missing that you would add to this list?

Please feel free to share what you think by posting a comment below…

What Would War Between Israel And Syria Do To The Already Fragile Global Economy?

May 5, 2013 by Michael

War is a horrible thing. Just ask anyone that has ever been in the middle of it. And in this day and age governments around the world possess weapons of such incalculable power that war should be unthinkable. In future wars, we could literally see millions of people killed on a single day. Nobody should want that or look forward to that. Unfortunately, the next major regional war in the Middle East appears to be closer than ever. But nobody should want it to actually happen. During the next major regional war in the Middle East we will likely see death on a scale that is unprecedented. It won’t be like the wars of 1967 or 1973. It will likely be a fight to the death where nothing is held back. You see, the truth is that most Americans have no idea what is really going on in the Middle East. There are ancient grudges and ancient hatreds that go back for thousands of years. There is no “peace plan” that is going to suddenly make everything okay. The Middle East is a simmering volcano of hate and resentment that could erupt at any moment. That is why what is happening in Syria right now is so important. An Israeli airstrike in Damascus that reportedly was attempting to destroy a shipment of Fateh-110 missiles that Iran was sending to Hezbollah has brought Israel and Syria to the brink of war. In fact, Syria is calling the airstrike a “declaration of war” and is vowing retaliation. The Syrian government is saying that “Israeli aggression opens the door to all possibilities“, but they have not provided any specifics about what they plan to do. Meanwhile, Israel has made it very clear that they will do whatever is necessary to keep Fateh-110 missiles from getting into the hands of Hezbollah. With those missiles, Iranian-backed Hezbollah would have the capability of striking the heart of Tel Aviv with a very high degree of accuracy. So it is definitely understandable why Israel would not want Hezbollah to have those missiles. Just think about it – would you want Russia or China to deploy highly advanced missile systems in northern Mexico which could rain down hell on Los Angeles and Dallas in less than five minutes? Unfortunately, this gives Iran the perfect way to provoke a war between Israel and Syria. All they have to do is keep rolling trucks loaded with Fateh-110 missiles through war-torn Syria toward Hezbollah bases in Lebanon. Israel will feel forced to intervene, and the rest of the Islamic world will get angrier and angrier.

The explosions that rocked northern Damascus on Sunday were absolutely massive. It is being reported that they registered about two or three on the Richter scale, and enormous balls of fire that lit up the sky could be seen from all over Damascus.

The following is how the Washington Post described the attack…

Israeli warplanes bombed the outskirts of Damascus early Sunday for the second time in recent days, according to Syrian state media and reports from activists, signaling a sharp escalation in tensions between the neighboring countries that had already been exacerbated by the conflict raging in Syria.

Videos posted on the Internet by activists showed a huge fireball erupting on Mount Qassioun, a landmark hill overlooking the capital on which the Syrian government has deployed much of the firepower it is using against rebel-controlled areas surrounding the city.

So why did Israel do this?

Despite what the anti-Israel crowd is suggesting, Israel did not do this just to be mean. As Reuters is reporting, Israel was specifically targeting Fateh-110 missiles that were on their way to Hezbollah…

Israel does not confirm such missions explicitly – a policy it says is intended to avoid provoking reprisals. But an Israeli official told Reuters on condition of anonymity that the strikes were carried out by its forces, as was a raid early on Friday that U.S. President Barack Obama said had been justified.

A Western intelligence source told Reuters: “In last night’s attack, as in the previous one, what was attacked were stores of Fateh-110 missiles that were in transit from Iran to Hezbollah.”

These missiles would significantly change the balance of power if they got into the hands of Hezbollah. According to the Times of Israel, Fateh-110 missiles would be a very serious threat not only to Tel Aviv – these missiles would also threaten cities all the way down to Beersheba…

Uzi Rubin, a missile expert and former Defense Ministry official, told the Associated Press that if the target was a consignment of Fatah-110 missiles, then such weaponry did constitute a “game-changer”: Fired from Syria or south Lebanon, these missiles, he said, could reach almost anywhere in Israel with high accuracy.

Rubin emphasized that he was speaking as a rocket expert and had no details about the reported strikes.

“If fired from southern Lebanon, they can reach Tel Aviv and even [the southern city of] Beersheba,” Rubin said. He said the rockets are much five times more accurate than the Scud missiles that Hezbollah has fired in the past. “It is a game-changer because they are a threat to Israel’s infrastructure and military installations,” he said.

So that is why Israel carried out these airstrikes. They feel like they simply cannot allow Hezbollah to have these weapons. And with Hezbollah’s track record, that is very understandable.

Unfortunately, these airstrikes have also brought the Middle East much closer to the next war.

According to the Jerusalem Post, Syria is positioning units for a potential conflict with Israel…

Syria has stationed missile batteries aimed at Israel in the aftermath of alleged Israeli air strikes in the country, the website of Lebanon’s Al Mayadeen TV, considered close to the regime of President Bashar Assad, quoted a top Syrian official as saying on Sunday.

In response, Israel has deployed two Iron Dome batteries to northern Israel, they have closed off airspace in northern Israel to commercial traffic, and Israeli embassies around the world have been put on high alert.

But Syria may choose not to retaliate against Israel directly. According to WND, Syria may decide to allow jihadist groups to carry out their vengeance for them…

The Syrian government will soon declare it is opening its borders with Israel for Palestinian and other jihad groups to carry out attacks against the Jewish state, a senior Syrian official told WND.

Separately, informed Middle Eastern security officials said the Syrian army held a meeting Sunday afternoon with the leaders of the military wing of the Iranian-backed Islamic Jihad terrorist group to discuss retaliation against Israel for the recent air strikes near Damascus.

According to those officials, Islamic Jihad and the Iranian-backed Hezbollah are coordinating a possible reaction to Israel’s reported strikes.

In any event, things are definitely becoming more unstable over in the Middle East.

So what would a war between Israel and Syria do to the already fragile global economy?

Well, a war between Israel and Syria would likely paralyze the entire region. Hezbollah and Hamas would almost certainly jump into the war on the side of Syria, and there is the potential that nations such as Iran, Egypt and even Jordan could get involved as well.

In such a scenario, the flow of oil from the Middle East could become interrupted for an extended period of time, and that would have serious consequences for the global economy.

But the bigger threat to the global economy would be the fear that a regional war in the Middle East would create. Global financial markets respond very badly to fear, and right now the world economy is already teetering on the brink of disaster. Much of Europe has already descended into a full-blown economic depression, and there are signs that the greatest debt bubble in the history of the planet is starting to burst.

The next major wave of the economic collapse is rapidly approaching, and a major regional war in the Middle East would greatly accelerate our economic problems.

Unfortunately, it appears that such a conflict is inevitable.

I don’t believe that it will happen yet though. For the moment, I believe that cooler headers will prevail.

But as tensions continue to rise, I believe that we will see tempers boil over and the Middle East will descend into full-blown warfare at some point within the next several years.

Of course I could always be wrong about this. We will just have to wait and see what happens.

So what do you think?

Do you believe that we will see a regional war in the Middle East soon?

Please feel free to post a comment with your thoughts below…

Why Is The World Economy Doomed? The Global Financial Pyramid Scheme By The Numbers

March 20, 2013 by Michael

Why is the global economy in so much trouble? How can so many people be so absolutely certain that the world financial system is going to crash? Well, the truth is that when you take a look at the cold, hard numbers it is not difficult to see why the global financial pyramid scheme is destined to fail. In the United States today, there is approximately 56 trillion dollars of total debt in our financial system, but there is only about 9 trillion dollars in our bank accounts. So you could take every single penny out of the banks, multiply it by six, and you still would not have enough money to pay off all of our debts. Overall, there is about 190 trillion dollars of total debt on the planet. But global GDP is only about 70 trillion dollars. And the total notional value of all derivatives around the globe is somewhere between 600 trillion and 1500 trillion dollars. So we have a gigantic problem on our hands. The global financial system is a very shaky house of cards that has been constructed on a foundation of debt, leverage and incredibly risky derivatives. We are living in the greatest financial bubble in world history, and it isn’t going to take much to topple the entire thing. And when it falls, it is going to be the largest financial disaster in the history of the planet.

The global financial system is more interconnected today than ever before, and a crisis at one major bank or in one area of the world can spread at lightning speed. As I wrote about yesterday, the entire European banking system is leveraged 26 to 1 at this point. A decline in asset values of just 4 percent would totally wipe out the equity of many of those banks, and once a financial panic begins we could potentially see major financial institutions start to go down like dominoes.

We got a small taste of what that is like back in 2008, and it is inevitable that it will happen again.

Anyone that would tell you that the current global financial system is sustainable does not know what they are talking about. Just look at the numbers that I have posted below.

The following is the global financial pyramid scheme by the numbers…

–$9,283,000,000,000 – The total amount of all bank deposits in the United States. The FDIC has just 25 billion dollars in the deposit insurance fund that is supposed to “guarantee” those deposits. In other words, the ratio of total bank deposits to insurance fund money is more than 371 to 1.

–$10,012,800,000,000 – The total amount of mortgage debt in the United States. As you can see, you could take every penny out of every bank account in America and it still would not cover it.

–$10,409,500,000,000 – The M2 money supply in the United States. This is probably the most commonly used measure of the total amount of money in the U.S. economy.

–$15,094,000,000,000 – U.S. GDP. It is a measure of all economic activity in the United States for a single year.

–$16,749,269,587,407.53 – The size of the U.S. national debt. It has grown by more than 10 trillion dollars over the past ten years.

–$32,000,000,000,000 – The total amount of money that the global elite have stashed in offshore banks (that we know about).

–$50,230,844,000,000 – The total amount of government debt in the world.

–$56,280,790,000,000 – The total amount of debt (government, corporate, consumer, etc.) in the U.S. financial system.

–$61,000,000,000,000 – The combined total assets of the 50 largest banks in the world.

–$70,000,000,000,000 – The approximate size of total world GDP.

–$190,000,000,000,000 – The approximate size of the total amount of debt in the entire world. It has nearly doubled in size over the past decade.

–$212,525,587,000,000 – According to the U.S. government, this is the notional value of the derivatives that are being held by the top 25 banks in the United States. But those banks only have total assets of about 8.9 trillion dollars combined. In other words, the exposure of our largest banks to derivatives outweighs their total assets by a ratio of about 24 to 1.

–$600,000,000,000,000 to $1,500,000,000,000,000 – The estimates of the total notional value of all global derivatives generally fall within this range. At the high end of the range, the ratio of derivatives to global GDP is more than 21 to 1.

Are you starting to get the picture?

Every single day, the total amount of debt will continue to grow faster than the total amount of money until the day that this bubble bursts.

What we witnessed back in 2008 was just a little “hiccup” in the system. It caused the worst economic downturn since the Great Depression, but global financial authorities were able to get things stabilized.

Next time it won’t be so easy.

The next wave of the economic collapse is quickly approaching. A full-blown economic depression has already started in southern Europe. Unemployment is at record highs and economic activity is contracting rapidly.

The major offshore banking centers in Cyprus are on the verge of collapsing. It was just announced that they will now be closed until Tuesday, but nobody really knows for sure when they will be allowed to reopen. And there is already talk that when they do reopen that there will be strict limits on how much money people can take out.

And now the IMF is warning that the three biggest banks in Slovenia are failing and that a billion euros will be needed to bail them out.

The dominoes are starting to tumble, and the United States won’t be immune. In fact, the greatest financial problems that the United States has ever seen are on the horizon.

But you can just have faith that Ben Bernanke, Barack Obama and the U.S. Congress know exactly what they are doing and will be able to save us from the coming financial collapse if you want.

The mainstream media will provide you with all of the positive economic news that you could possibly want. They are giddy about the fact that the Dow keeps hitting all-time highs and they would have us all believe that we are in the midst of a robust economic recovery. You can listen to them if you want to.

But when you are tempted to believe that everything is going to be “okay” somehow, just go back and look at the numbers there were posted above one more time.

There is no way that the global financial pyramid scheme is going to be able to hold up for too much longer. At some point it is going to totally collapse. When that happens, will you be ready?

Who Controls The Money? An Unelected, Unaccountable Central Bank Of The World Secretly Does

February 5, 2013 by Michael

An immensely powerful international organization that most people have never even heard of secretly controls the money supply of the entire globe. It is called the Bank for International Settlements, and it is the central bank of central banks. It is located in Basel, Switzerland, but it also has branches in Hong Kong and Mexico City. It is essentially an unelected, unaccountable central bank of the world that has complete immunity from taxation and from national laws. Even Wikipedia admits that “it is not accountable to any single national government.” The Bank for International Settlements was used to launder money for the Nazis during World War II, but these days the main purpose of the BIS is to guide and direct the centrally-planned global financial system. Today, 58 global central banks belong to the BIS, and it has far more power over how the U.S. economy (or any other economy for that matter) will perform over the course of the next year than any politician does. Every two months, the central bankers of the world gather in Basel for another “Global Economy Meeting”. During those meetings, decisions are made which affect every man, woman and child on the planet, and yet none of us have any say in what goes on. The Bank for International Settlements is an organization that was founded by the global elite and it operates for the benefit of the global elite, and it is intended to be one of the key cornerstones of the emerging one world economic system. It is imperative that we get people educated about what this organization is and where it plans to take the global economy.

Sadly, only a very small percentage of people actually know what the Bank for International Settlements is, and even fewer people are aware of the Global Economy Meetings that take place in Basel on a bi-monthly basis.

These Global Economy Meetings were discussed in a recent article in the Wall Street Journal…

Every two months, more than a dozen bankers meet here on Sunday evenings to talk and dine on the 18th floor of a cylindrical building looking out on the Rhine.

The dinner discussions on money and economics are more than academic. At the table are the chiefs of the world’s biggest central banks, representing countries that annually produce more than $51 trillion of gross domestic product, three-quarters of the world’s economic output.

The article goes on to describe the room that these Global Economy Meetings are held in. It sounds like something out of a novel…

The Bank of England’s Mr. King leads the dinner discussions in a room decorated by the Swiss architectural firm Herzog & de Meuron, which designed the “Bird’s Nest” stadium for the Beijing Olympics. The men have designated seats at a round table in a dining area scented by white orchids and framed by white walls, a black ceiling and panoramic views.

The central bankers that gather for these meetings are not there just to socialize. No staff members are allowed into these meetings, and they are conducted in an atmosphere of absolute secrecy…

Serious matters follow appetizers, wine and small talk, according to people familiar with the dinners. Mr. King typically asks his colleagues to talk about the outlook in their respective countries. Others ask follow-up questions. The gatherings yield no transcripts or minutes. No staff is allowed.

So the fate of the world economy is determined by unelected central bankers in secret meetings that nobody ever hears about?

That certainly does not sound very “democratic”.

But this is the direction that “global governance” is taking us. The elite believe that the “big decisions” are far too important to be left “to the people”, and so most of the “international institutions” that have been established by the elite operate independently of the democratic process.

Sadly, the truth is that all of this has been planned for a very long time.

In a recent article entitled “Who Runs The World? Solid Proof That A Core Group Of Wealthy Elitists Is Pulling The Strings“, I included a quote from Georgetown University history professor Carroll Quigley from a book that he wrote all the way back in 1966 in which he discussed the big plans that the elite had for the Bank for International Settlements…

[T]he powers of financial capitalism had another far-reaching aim, nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements arrived at in frequent private meetings and conferences. The apex of the system was to be the Bank for International Settlements in Basle, Switzerland, a private bank owned and controlled by the world’s central banks which were themselves private corporations.

Back then, the Bank for International Settlements was only just starting to play a major role in global affairs. But over the years the BIS began to become increasingly important. The following is an excerpt from an article by Ellen Brown…

For many years the BIS kept a very low profile, operating behind the scenes in an abandoned hotel. It was here that decisions were reached to devalue or defend currencies, fix the price of gold, regulate offshore banking, and raise or lower short-term interest rates. In 1977, however, the BIS gave up its anonymity in exchange for more efficient headquarters. The new building has been described as “an eighteen story-high circular skyscraper that rises above the medieval city like some misplaced nuclear reactor.” It quickly became known as the “Tower of Basel.” Today the BIS has governmental immunity, pays no taxes, and has its own private police force. It is, as Mayer Rothschild envisioned, above the law.

Yes, it most definitely does bear a striking resemblance to the Tower of Babel as you can see from the photo in this article. Once again the global elite are trying to unite humanity under a single system, and that is most definitely not a good thing.

But many of these elitists are entirely convinced that “global governance” is what humanity desperately needs. They even publicly tell us what they plan to do, but most people are not listening.

For example, the following is an excerpt from a speech that former president of the European Central Bank Jean-Claude Trichet delivered to the Council On Foreign Relations in New York…

In the area of central bank cooperation, the main forum is the Global Economy Meeting (GEM), which gathers at the BIS headquarters in Basel. Over the past few years, this forum has included 31 governors as permanent members plus a number of other governors attending on a rotating basis. The GEM, in which all systemic emerging economies’ Central Bank governors are fully participating, has become the prime group for global governance among central banks.

The speech was entitled “Global Governance Today”, and you can find the full transcript right here. But most people have never even heard that such a thing as a “Global Economy Meeting” even exists because the mainstream media rarely discusses these sorts of things. They are too busy focusing on the latest celebrity scandal or the latest cat fights between the Republicans and the Democrats.

If you go to the official BIS website, the purposes of the organization sound fairly innocent and quite boring…

The mission of the Bank for International Settlements (BIS) is to serve central banks in their pursuit of monetary and financial stability, to foster international cooperation in those areas and to act as a bank for central banks.

In broad outline, the BIS pursues its mission by:

promoting discussion and facilitating collaboration among central banks;

supporting dialogue with other authorities that are responsible for promoting financial stability;

conducting research on policy issues confronting central banks and financial supervisory authorities;

acting as a prime counterparty for central banks in their financial transactions; and

serving as an agent or trustee in connection with international financial operations.

The head office is in Basel, Switzerland and there are two representative offices: in the Hong Kong Special Administrative Region of the People’s Republic of China and in Mexico City.

But when you start looking into the details, things get much more interesting.

So exactly how does the BIS achieve “monetary and financial stability”? An article posted on investorsinsight.com described how this is accomplished…

It accomplishes this through control of currencies. It currently holds 7% of the world’s available foreign exchange funds, whose unit of account was switched in March of 2003 from the Swiss gold franc to Special Drawing Rights (SDR), an artificial fiat “money” with a value based on a basket of currencies (44% U.S. dollar, 34% euro, 11% Japanese yen, 11% pound sterling).

The bank also controls a huge amount of gold, which it both stores and lends out, giving it great leverage over the metal’s price and the marketplace power that brings, since gold is still the only universal currency. BIS gold reserves were listed on its 2005 annual report (the most recent) as 712 tons. How that breaks down into member banks’ deposits and the BIS personal stash is unknown.

By controlling foreign exchange currency, plus gold, the BIS can go a long way toward determining the economic conditions in any given country. Remember that the next time Ben Bernanke or European Central Bank President Jean-Claude Trichet announces an interest rate hike. You can bet it didn’t happen without the concurrence of the BIS Board.

In recent years, it has become increasingly obvious who really has power over our economy.

When Barack Obama speaks, the markets usually move very little.

When Ben Bernanke speaks, the markets often respond with wild gyrations.

A recent CNBC article entitled “Central Banks: How They Are Ruling the Financial World” detailed the enormous impact that central banks had on the global financial system during 2012…

In all, 13 other central banks in the world have followed the Fed’s lead and set interest rates at or near zero in an effort to keep the liquidity spigots open and prop up their ailing economies. Those 14 economies represent a staggering $65 trillion in combined equity and bond market capitalizations, according to Bank of America Merrill Lynch.

Later on in that same article, the author discussed the enormous amounts of money that global central banks were creating out of thin air…

“When you add up all the central banks in the world, it’s going to be over $9 trillion,” said Marc Doss, regional chief investment officer for Wells Fargo Private Bank. “That’s like creating the second-largest economy in the world out of thin air.”

Indeed, central banking has become an economy unto itself, a multi-trillion-dollar empire that massages and manipulates markets, which respond to the slightest news out of the respective entities’ policy making committees.

So who controls the money?

The central banks of the world do.

And who controls those central banks?

The Bank for International Settlements does.

If we don’t like what the Bank for International Settlements is doing, can we do anything about it?

Nope. The Bank for International Settlements is above the law…

Maybe we’d feel better about the BIS if it were more transparent, but most everything about it, including its bi-monthly member and board meetings, is shrouded in secrecy. And perhaps more worrisome is that the BIS is free from oversight. By rights granted under its agreement with the Swiss Federal Council, all of the bank’s archives, documents and “any data media” are “inviolable at all times and in all places.” Furthermore, officers and employees of BIS “enjoy immunity from criminal and administrative jurisdiction, save to the extent that such immunity is formally waived . . . even after such persons have ceased to be Officials of the Bank.” Finally, no claims against BIS or its deposits may be enforced “without the prior agreement of the Bank.”

In other words they can do whatever they want, without consequences. How’s that for a leak-proof legal umbrella?

If the BIS wants to “intervene” in the financial markets, they simply just do it.

If the BIS wants to bail out big banks or even entire nations, they simply just do it.

The BIS reminds me of this old joke…

Q: Where does an 800 pound gorilla sit?

A: Anywhere it wants to.

So what is next for the Bank for International Settlements?

Well, many have speculated that eventually the goal is to have just a single global currency which will be administered by a single global central bank. The BIS is already using Special Drawing Rights (SDRs), which are considered to be a precursor to the coming global currency. The BIS played a big role in the adoption of the euro, and more currency integration is almost certainly on the way in future years…

But in the end, how you feel about the BIS may come down to how you feel about a one-world currency. The bank was a major player promoting the adoption of the euro as Europe’s common currency. There are rumors that its next project is persuading the U.S., Canada and Mexico to switch to a similar regional money, perhaps to be called the “amero,” and it’s logical to assume the bank’s ultimate goal is a single world currency. That would simplify transactions and really solidify the bank’s control of the planetary economy.

But if the United States ever did give up the U.S. dollar, it would be a massive blow to our national sovereignty.

When someone else controls your money, it doesn’t really matter that much who makes the laws.

Unfortunately, the global elite seem absolutely obsessed with the idea of a global currency, a one world economic system and a global government.

None of those things will happen this year, but that is where we are moving. With each new crisis that arises, the solutions that we will be given will always involve more centralization and more globalization.

So what do you think about all of this?

Please feel free to share your thoughts by leaving a comment below…

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?

21 Signs That The Global Economic Crisis Is About To Go To A Whole New Level

October 14, 2012 by Michael

The global debt crisis has reached a dangerous new phase. Unfortunately, most Americans are not taking notice of it yet because most of the action is taking place overseas, and because U.S. financial markets are riding high. But just because the global economic crisis is unfolding at the pace of a “slow-motion train wreck” right now does not mean that it isn’t incredibly dangerous. As I have written about previously, the economic collapse is not going to be a single event. Yes, there will be days when the Dow drops by more than 500 points. Yes, there will be days when the reporters on CNBC appear to be hyperventilating. But mostly there will be days of quiet despair as the global economic system slides even further toward oblivion. And right now things are clearly getting worse. Things in Greece are much worse than they were six months ago. Things in Spain are much worse than they were six months ago. The same thing could be said for Italy, France, Japan, Argentina and a whole bunch of other nations. The entire global economy is slowing down, and we are entering a time period that is going to be incredibly painful for everyone. At the moment, the U.S. is still experiencing a “sugar high” from unprecedented fiscal and monetary stimulus, but when that “sugar high” wears off the hangover will be excruciating. Reckless borrowing, spending and money printing has bought us a brief period of “economic stability”, but our foolish financial decisions will also make our eventual collapse far worse than it might have been. So don’t think for a second that the U.S. will somehow escape the coming global economic crisis. The truth is that before this is all over we will be seen as one of the primary causes of the crisis.

The following are 21 signs that the global economic crisis is about to go to a whole new level….

#1 Bank of Israel Governor Stanley Fischer says that the global economy is “awfully close” to recession.

#2 It was announced last week that the unemployment rate in Greece has reached an all-time high of 25.1 percent. Unemployment among those 24 years old or younger is now more than 54 percent. Back in April 2010, the unemployment rate in Greece was only sitting at 11.8 percent.

#3 The IMF is warning that Greek debt may have to be “restructured” yet again.

#4 Swedish Finance Minister Anders Borg says that it is “probable” that Greece will leave the euro, and that it might happen within the next six months.

#5 An angry crowd of approximately 40,000 angry Greeks recently descended on Athens to protest a visit by German Chancellor Angela Merkel…

From high-school students to pensioners, tens of thousands of Greek demonstrators swarmed into Athens yesterday to show the visiting German Chancellor, Angela Merkel, their indignation at their country’s continued austerity measures.

Flouting the government’s ban on protests, an estimated 40,000 people – many carrying posters depicting Ms Merkel as a Nazi – descended on Syntagma Square near the parliament building. Masked youths pelted riot police with rocks as the officers responded with tear gas.

The authorities had deployed 7,000 police, water cannon and a helicopter. Snipers were placed on rooftops to ensure the German leader’s safety.

#6 The debt crisis is Argentina is becoming increasingly troublesome.

#7 The government debt to GDP ratio in Italy is expected to hit 126 percent this year. In Greece, it is expected to hit 198 percent. In Japan, it is expected to hit a whopping 237 percent.

#8 Standard & Poor’s has slashed the credit rating on Spanish government debt to BBB-, which is just one level above junk status.

#9 Back in the year 2000, the ratio of total debt to GDP in Spain was 192 percent. By 2011, it had reached 363 percent.

#10 Record amounts of money are being pulled out of Spanish banks, and many large Spanish banks are rapidly heading toward insolvency.

#11 Manufacturing activity in Spain has contracted for 17 months in a row.

#12 It is being projected that home prices in Spain will fall by another 15 percent by the end of 2013.

#13 The unemployment rate in France is now above 10 percent, and it has risen for 16 months in a row.

#14 There are signs that Switzerland may be preparing for “major civil unrest” throughout Europe.

#15 The former top economist at the European Central Bank says that the ECB has fallen into a state of “panic” as it desperately tries to solve the European debt crisis.

#16 According to a recent IMF report, European banks may need to sell off 4.5 trillion dollars in assets over the next 14 months in order to meet strict new capital requirements.

#17 In August, U.S. exports dropped to the lowest level that we have seen since last February.

#18 Economics Professor Barry Eichengreen is very concerned about what is coming next for stocks in the United States…

“I’m worried that stock markets in the United States in particular have gotten ahead of economic growth”

#19 During the week ending October 3rd, investors pulled more than 10 billion dollars out of U.S. mutual funds. Overall, a total of more than 100 billion dollars has been pulled out of U.S. mutual funds so far this year.

#20 As I wrote about the other day, the IMF is warning that there is an “alarmingly high” risk of a deeper global economic slowdown.

#21 When shipping companies start laying off workers, that is one of the best signs that economic activity is slowing down. That is why it was so troubling when it was announced that FedEx is planning to get rid of “several thousand” workers over the coming months. According to AFP, “its business is being hit by the global economic slowdown”.

For even more signs that the global economy is rapidly crumbling, please see my previous article entitled “The Largest Economy In The World Is Imploding Right In Front Of Our Eyes“.

So is anyone doing well right now?

Yes, it turns out that QE3 is padding the profits of the big banks in the United States and making the wealthy even wealthier just like I warned that it would.

According to the Washington Post, QE3 is helping the big banks much more than it is helping consumers. Is this what the Fed intended all along?…

JPMorgan Chase and Wells Fargo, the nation’s largest mortgage lenders, said Friday they won’t make home loans much cheaper for consumers, even as they reported booming profits from that business.

Those bottom lines have been padded by federal initiatives to stimulate the economy. The Federal Reserve is spending $40 billion a month to reduce mortgage rates to encourage Americans to buy homes. Instead, its policies may be generating more benefits for banks than borrowers.

So exactly how much has QE3 helped out the big banks? Just check out these numbers…

Revenue from mortgages was up 57 percent in the third quarter compared with the same period last year at JPMorgan and more than 50 percent up at Wells Fargo.

But should we expect anything else from the Federal Reserve?

The American people are trusting the Fed to protect our economy, and yet they cannot even protect their own shipments of money. In fact, the Fed recently lost a large shipment of new $100 bills.

Or perhaps could letting people steal money from their own trucks be another way that the Fed is trying to “stimulate the economy”?

Stranger things have happened.

In any event, the truth is that the U.S. economy and the U.S. financial system are unsustainable from any angle that you want to look at things.

We are drowning in government debt, we are drowning in consumer debt, Wall Street has been transformed into a high risk casino where our largest financial institutions are putting it all on the line on a daily basis, we are consuming far more than we are producing, there are more than 100 million Americans on welfare and we are stealing more than 100 million dollars an hour from future generations to pay for it all.

Anyone that believes that we are in “good shape” does not know the first thing about economics.

Sadly, the U.S. is not alone. Nations all over the globe are experiencing similar problems.

The global economic crisis is just beginning and it is going to get much, much worse.

I hope that you ready.

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