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alstry (34.88)

NY Gov Saying California Going Bankrupt???

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November 13, 2009 – Comments (8)

"Now many of the legislatures don’t understand what a downgrading in a credit rating is eventually going to do. They need to go spend a few weeks in California, it might be a good investment for us to send them there because California is in a state which, I don’t know, in spite of the valiant efforts of their governor, I don’t know that California can remain in a place where they don’t inevitably go into default."

Did Paterson really mean to suggest that the largest state in the Union will stiff the investors who own tens of billions of dollars of its bonds?

http://latimesblogs.latimes.com/money_co/2009/11/new-york-gov-david-paterson-california-debt-bond-default.html

Soon you will understand that practically everything is going bankrupt as an UNPRECEDENTED amount of slowly defaulting debt sucks out declining cash flow.  It is the mathematically certain outcome of Zoombulation.

What is absolutely amazing is all of this was so foreseeable......Alstry, the lunatic blogger has been blogging about it for a couple years......now the question is why have our politicians remained silent while the banking system is systematically shutting down our economy as citizens are subsidizing the bankers????

You will find out pretty soon......and I am highly confident you will be shocked.

The longer this takes.....the more people's skills will atrophy due to protracted non use.

We now start to really feel Zombulation as we move forward.......

San Francisco Commercial Property Sales Activity dropped 79%

91% in New York.

That is a BIG drop in commissions, financing revenues, and taxes paid!!!!!!!  Not to mention the dramatic drop in p/sq/ft values of all commerciaal bldgs.

We are now feeling our economy coming to a grinding halt......if RE is not active, we don't have much of a private economy.....and right now, we are really beginning to feel our private economy shrink....setting the stage for the government crash.

 

8 Comments – Post Your Own

#1) On November 13, 2009 at 9:30 PM, alstry (34.88) wrote:

A little hint where this is going:

If you go do your homework, you will learn that Buffett and a number of other "BIG THINKERS" view the single biggest issue facing human existence right now is OVERPOPULATION.

Now the question is who will be deemed the fittest.

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#2) On November 13, 2009 at 10:26 PM, tomatoflu (< 20) wrote:

 

Some peripheral info.

How Fiat currency is actually destroyed in the Fractional Reserve Banking System.

Here is a link and an excerp from the link.

 

"commercial bank money (money created in the banking system through borrowing and lending) - sometimes referred to as checkbook money[5]

When a commercial bank loan is extended, new commercial bank money is created. As a loan is paid back, the commercial bank money disappears from existence."

(There are plenty of fools who know how money is created out of thin air these days, but not at all very many who know how it goes back from whence it came.)

 Ultra important to cognize if you are not able to comprehend how the money supply is being contracted, since paying off the principal of a loan actually removes the money from existance.

 It is destroyed!!

LoL, unless a new loan is created......

 

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#3) On November 13, 2009 at 10:41 PM, alstry (34.88) wrote:

That is true...and it mathematically takes ever expanding credit creation simply to service the interest.  If credit is curtailed and people are paying down debt and not spending....it becomes IMPOSSIBLE to collectively service the interest obligations of the outstanding debt.

And you think Alstry is extreme....you get the feeling anger is rising these days???

 by PAUL CRAIG ROBERTS

The US government's current operating budget is dependent on foreign financing and money creation.

Too politically weak to be able to advance its interests through diplomacy, the US relies on terrorism and military aggression.
(http://www.reuters.com/article/newsOne/idUSTRE59H0AH20091019)

Costs are out of control, and priorities are skewed in the interest of rich organized interest groups at the expense of the vast majority of citizens.

For example, war at all cost, which enriches the armaments industry, the officer corps and the financial firms that handle the war's financing, takes precedence over the needs of American citizens.

There is no money to provide the uninsured with health care, but Pentagon officials have told the Defense Appropriations Subcommittee in the House that every gallon of gasoline delivered to US troops in Afghanistan costs American taxpayers $400.

"It is a number that we were not aware of and it is worrisome," said Rep. John Murtha, chairman of the subcommittee.
http://thehill.com/homenews/administration/63407-4
00gallon-gas-another-cost-of-war-in-afghanistan-

According to reports, the US Marines in Afghanistan use 800,000 gallons of gasoline per day.

At $400 per gallon, that comes to a $320,000,000 daily fuel bill for the Marines alone. Only a country totally out of control would squander resources in this way.

While the US government squanders $400 per gallon of gasoline in order to kill women and children in Afghanistan, many millions of Americans have lost their jobs and their homes and are experiencing the kind of misery that is the daily life of poor third world peoples.

Americans are living in their cars and in public parks. America's cities, towns, and states are suffering from the costs of economic dislocations and the reduction in tax revenues from the economy's decline. Yet, Obama has sent more troops to Afghanistan, a country half way around the world that is not a threat to America.

It costs $750,000 per year for each soldier we have in Afghanistan.

The soldiers, who are at risk of life and limb, are paid a pittance, but all of the privatized services to the military are rolling in excess profits.

One of the great frauds perpetuated on the American people was the privatization of services that the US military traditionally performed for itself.

"Our" elected leaders could not resist any opportunity to create at taxpayers' expense private wealth that could be recycled to politicians in campaign contributions.

Republicans and Democrats on the take from the private insurance companies maintain that the US cannot afford to provide Americans with health care and that cuts must be made even in Social Security and Medicare.

So how can the US afford bankrupting wars, much less totally pointless wars that serve no American interest?

The enormous scale of foreign borrowing and money creation necessary to finance Washington's wars are sending the dollar to historic lows.

The dollar has even experienced large declines relative to currencies of third world countries such as Botswana and Brazil. The decline in the dollar's value reduces the purchasing power of Americans' already declining incomes.

Despite the lowest level of housing starts in 64 years, the US housing market is flooded with unsold homes, and financial institutions have a huge and rising inventory of foreclosed homes not yet on the market.

Industrial production has collapsed to the level of 1999, wiping out a decade of growth in industrial output.

The enormous bank reserves created by the Federal Reserve are not finding their way into the economy.

Instead, the banks are hoarding the reserves as insurance against the fraudulent derivatives that they purchased from the gangster Wall Street investment banks.

The regulatory agencies have been corrupted by private interests.

Frontline reports that Alan Greenspan, Robert Rubin, and Larry Summers blocked Brooksley Born, the head of the Commodity Futures Trading Commission from regulating derivatives.(http://www.pbs.org/wgbh/pages/frontline/warning/)

President Obama rewarded Larry Summers for his idiocy by appointing him Director of the National Economic Council.

What this means is that profits for Wall Street will continue to be leeched from the diminishing blood supply of the American economy.

An unmistakable sign of third world despotism is a police force that sees the pubic as the enemy. Thanks to the federal government, our local police forces are now militarized and imbued with hostile attitudes toward the public.

SWAT teams have proliferated, and even small towns now have police forces with the firepower of US Special Forces. Summons are increasingly delivered by SWAT teams that tyrannize citizens with broken down doors, a $400 or $500 repair born by the tyrannized resident.

Recently a mayor and his family were the recipients of incompetence by the town's local SWAT team, which mistakenly wrecked the mayor's home, terrorized his family, and killed the family's two friendly Labrador dogs.

If a town's mayor can be treated in this way, what do you think is the fate of the poor white or black? Or the idealistic student who protests his government's inhumanity?

In any failed state, the greatest threat to the population comes from the government and the police. That is certainly the situation today in the USA.

Americans have no greater enemy than their own government.

Washington is controlled by interest groups that enrich themselves at the expense of the American people.

The one percent that comprise the super-rich are laughing as they say, "let them eat cake."

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#4) On November 13, 2009 at 10:45 PM, tomatoflu (< 20) wrote:

 

What is 'not' destroyed is the interest which is collected, and fees and charges to service the loan. This Fiat component of a loan does not get destroyed when a loan is serviced or payed down.

It is black hole, and whilst banks are not lending, the money supply is shrinking rapidly irrespective of defaults etc, etc, etc via this unspoken mechanism which is very much a part of our modern Fiat world. 

The quote again: "When a commercial bank loan is extended, new commercial bank money is created. As a loan is paid back, the commercial bank money disappears from existence." Report this comment
#5) On November 13, 2009 at 10:52 PM, tomatoflu (< 20) wrote:

 

Thanks Alstry, but i merely wanted to bring this little known mechanism to the attention of fellow fools.

It was begining to seem to me that everyone was aware of how money is created out of thin air, but it was increasingly evident that not many at all understood the money uncreation process, or how Fiat is destroyed.

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#6) On November 13, 2009 at 11:26 PM, alstry (34.88) wrote:

IT IS NOT JUST CALIFORNIA....OR NEW YORK....OR AZ.....

The Pierce County Council has approved a budget that will cut more than 300 jobs, raises fees and sets up major consolidation of the county government services.

The News Tribune of Tacoma reports that the council approved the $269.3 million 2010 budget Tuesday, a budget 7 percent smaller than this year's.

The cuts will mean longer lines at county buildings and fewer sheriff's deputies as staff is reduced and furloughs are taken.

THE GOVERNMENT CRASH IS EVERYWHERE.....

Iowa will eliminate 205 court positions because of ongoing budget cuts, but the courts will not take the same 10 percent hit as other areas of government, judicial branch officials announced Thursday.

The cuts - including 105 layoffs and 10 days of required unpaid leave for all employees - mean the judicial branch budget will shrink by $11.4 million, or 7.1 percent.

CONSIDERING THE MASSIVE NUMBER OF PUBLIC AND PRIVATE SECTOR CUTBACKS AND LAYOFFS.....A DEEP DEPRESSION IS PRETTY MUCH A LOCK AT THIS POINT FACTORING THE MULTIPLIER EFFECT.

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#7) On November 14, 2009 at 12:34 AM, tomatoflu (< 20) wrote:

Ahh yes,..........Hmmmmm, the 'inverse money multiplier effect'.

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#8) On November 14, 2009 at 9:49 AM, dickseacup (67.49) wrote:

Don't Panic!!!

There is nothing to worry about, salvation is on the horizon and she's steaming hard for shore!

Obama wants domestic spending cuts in next budget

The Obama administration, mindful of public anxiety over the government's mushrooming debt, is shifting emphasis from big-spending policies to deficit reduction. Domestic agencies have been told to brace for a spending freeze or cuts of up to 5 percent as part of a midterm election-year push to rein in record budget shortfalls.

Gosh, at least his heart is in the right place...all that compassion and hope for the masses. Oh, wait,  he just wants to ensure his buddies in the legislature get re-elected so they can continue shafting the idiots who continue voting for them. Never mind that whacking government spending, when it has become the dominant driver of our economy will finish off those idiots for good...hey, you think this is all planned?

Alstry, can you lay out for us what the chances are that the government can balance the budget, continue to fuel the economy and service the massive debt load generated over the last two years?

As the shepherd said to the sheepdog, "It's time to get the flock out of here."

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