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alstry (35.02)

8.9.10....It is only a question of when?

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August 07, 2010 – Comments (4)

For Alstry, it wasn't hard to see if banks loaned Americans trillions of dollars to buy, refinance, and extract "equity" from their homes......America would have the perception of a boom while the process was going on, this was an unprecedented amount of borrowing and we would be told that houses never go down in price so keep borrowing regardless of income.......and the more we borrowed, the bigger the boom......and if Wall Street took that debt and stuffed it in our retirement, pension, and investment accounts, bankers would get rich and it would appear that our net worth was rising...............................until Wall Street cut Americans off of credit, then all would crash..................and all did.

But instead of restructuring the system, we bailed out Washington and Wall Street and did very little for the private economy.....so here we go again, but this time Washington and Wall Street is borrowing trillions each year and that debt is again being stuffed into our retirement, investment, and pension funds......HOWEVER, while we are giving unlimited money to bankers and Washington, Wall Street is cutting off credit to the private sector and outsourcing many of our jobs so much of the private sector is collapsing or in a Depression causing tax receipts to evaporate.

Now the only question is when will bankers cut off credit to Washington, just like they did to homeowners.......at that point a collapse is guaranteed as most Americans are now dependent on government checks each month to consume....and those who are not dependent on government checks are dependent on those below consuming for their income.

50,000,000 Socicial Security and Medicare/Medicaid recipients

41,000,000 Food Stamp recipients

+/-20,000,000 Unemployment recipients

+/-20,000,000 Government employees

and an entire Healthcare industry most funded by government dollars

PLUS ALL OF THE DEPENDENTS OF THE ABOVE........

and how is the above being funded?......just like the housing boom.....by borrowing money, and now incredible amount of money.....Over $1.5 Trillion PER YEAR just at the Federal Level alone......and obligations are rising rapidly as more and more are becoming dependent on government checks as the population ages and the private sector is outsourced or shutdown.

Alstry tried to warn people about the pending housing collapse.....people thought he was crazy as housing was the backbone of America.  Then, we saw what happend when homeowners were allowed to borrow many trillions and cut off of credit......it will be interesting to see what happens to America when politicians are cut off of credit......remember, there is always a point when you can't borrow anymore.....it is just a question of when.

 

The same is true with

4 Comments – Post Your Own

#1) On August 07, 2010 at 10:04 AM, alstry (35.02) wrote:

It is amazing how much tax receipts can be generated if you simply overpay politicians.....

The California city of Bell says seven more city workers received high salaries, with two making more than $400,000 per year and three making more than $200,000. 

http://www.cbsnews.com/stories/2010/08/06/national/main6751175.shtml
 

However, when you are borrowing the money to pay those salaries.....the incomes and tax receipts are suspect.  Federal, States, Counties, and Cities are now collectively borrowing about $2 trillion dollars per year......an unprecedented amount.

How much of current revenues, sales and tax receipts are simply the product of government borrowing and spending?

8.9.10............it is only a question of when....

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#2) On August 07, 2010 at 10:14 AM, tomatoflu (< 20) wrote:

Hyperinflation or Deflation? Dramatic Fiscal Austerity Measures: "Deficit Terrorists" Strike in the UK -- The USA is Next
by Ellen Brown

Banks advance the principal but not the interest necessary to pay off their loans; and since bank loans are now virtually the only source of new money in the economy, the interest can only come from additional debt.  For the banks, that means business continues to boom; while for the rest of the economy, it means cutbacks, belt-tightening and austerity.   Since more must always be paid back than was advanced as credit, however, the system is inherently unstable.  When the debt bubble becomes too large to be sustained, a recession or depression is precipitated, wiping out a major portion of the debt and allowing the whole process to begin again.  This is called the “business cycle,” and it causes markets to vacillate wildly, allowing the monied interests that triggered the cycle to pick up real estate and other assets very cheaply on the down-swing. 

 

The financial sector, which controls the money supply and can easily capture the media, cajoles the populace into compliance by selling its agenda as a “balanced budget,” “fiscal responsibility,” and saving future generations from a massive debt burden by suffering austerity measures now.  Bill Mitchell, Professor of Economics at the University of New Castle in Australia, calls this “deficit terrorism.”  Bank-created debt becomes more important than schools, medical care or infrastructure.  Rather than “providing for the general welfare,” the purpose of government becomes to maintain the value of the investments of the government’s creditors. 

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#3) On August 07, 2010 at 10:16 AM, tomatoflu (< 20) wrote:

Ellen Brown knows ..........Banks advance the principal but not the interest necessary to pay off their loans;

An amazing woman in every way.

I really like her.

And thanks!@!

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#4) On August 07, 2010 at 10:27 AM, alstry (35.02) wrote:

Tomato.....

It is nice to see there are some Fools that think......

The current events mirror the moments leading up to the housing/banking collapse....but this one is much larger, the government collapse.

OVER 2/3 OF AMERICANS ARE DEPENDENT ON GOVERNMENT SPENDING TO CONSUME EACH MONTH AND OVER 2/3 OF OUR ECONOMY IS DEPENDENT ON CONSUMPTION

THINK ABOUT THOSE FIGURES FOR A SECOND....

What is still amazing to this day is how the sheep allowed politicians to bailout Washington and Wall Street and not the citizens they served?

Had the sheep been bailed out....Washington and Wall Street would have been the beneficiary.........now the real question is why?

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