Video: Say DEBT 50 Times, Fast. (Hat Tip: Caleb Howe)
From: The Blaze
The earthquake, tsunami, and nuclear disaster that hit Japan this past week and the destruction that it caused is nothing compared to the tsunami of inflation that will soon hit the U.S. as a result of this crisis. A tsunami of inflation in the U.S. will mean a complete collapse of our monetary system, which could lead to millions of deaths due to a lack of food and heat. 44 million Americans are now dependent on food stamps, but when the U.S. dollar becomes worthless as a result of hyperinflation, the government will no longer have the power to support these Americans and many of them will simply starve to death.
Japan’s citizens were smart enough to save up $885.9 billion in U.S. treasuries to spend in a situation like it finds itself in today. The U.S. has no such savings and is the world’s largest debtor nation. Our ability to survive depends on our ability to print money that has purchasing power. The only reason the U.S. dollar still has purchasing power is the dollar’s status as the world’s reserve currency.
All Japan has to do is sell their U.S. treasuries and they will have the financial resources necessary to rebuild the parts of their country that were destroyed by this past week’s disaster. However, U.S. Treasury Secretary Timothy Geithner said on Tuesday that he doesn’t think Japan will unload their $885.9 billion in U.S. treasuries. It remains to be seen if Japan will do the right thing and sell their U.S. treasuries or if they will make the mistake of continuing to artificially prop up the U.S. economy.
The Central Bank of Japan (BOJ) in recent days has already been repeating many of the same mistakes the Federal Reserve made in the U.S. After this past week’s disaster, the BOJ printed hundreds of billions of dollars worth of yen in an attempt to prop up their financial markets. Japan’s central bank should be raising interest rates, which would encourage its citizens to increase their savings so that they have more resources to rebuild their country and invest into the production of clean energy. By printing trillions of yen out of thin air, the BOJ will cause prices to rise for the very building materials the Japanese need to purchase in order to rebuild.
Although the yen has been rising in recent days, it would be strengthening a lot more if it wasn’t for the BOJ’s actions. In fact, NIA believes that while the yen may continue to rise in the short-term, the yen is now likely to lose a substantial amount of its purchasing power over the long-term. Instead of allowing the yen to strengthen so that it is cheaper for the Japanese in import copper, iron, steel, oil, natural gas, and other commodities needed to rebuild, the BOJ’s actions are actually hurting the Japanese and having the effect of propping up the U.S. economy in the short-term.
The mainstream media frequently talks about Japan’s national debt and how it is 225% of their GDP. However, Japan owes most of their national debt to themselves. We have a much worse national debt crisis here in the U.S., where we owe half of our debt to foreigners. Not only that, but once you include America’s unfunded liabilities for Social Security, Medicare, and Medicaid, along with its debts for Fannie Mae and Freddie Mac (which are now government backed entities), total U.S. debt obligations now exceed $76 trillion.
The Japanese economy reached peak consumer spending in 1990 and entered their “Lost Decade” of deflation with a balanced budget, high savings rate of 15%, low unemployment rate of 2%, and a net debt to GDP ratio of less than 20%. The average American peaks in spending at age 46 and the last babyboomer just turned 46 in 2010. This means the U.S. economy just passed peak consumer spending, similar to Japan in 1990. Instead of entering this decade from a position of strength, the U.S. has entered it with a real budget deficit of $4.3 trillion, a savings rate of only 4%, a real unemployment rate of 22%, and total debt obligations that are 5 times higher than GDP. We won’t be so lucky to escape this decade with deflation, but will instead be faced with hyperinflation as the world loses confidence in the U.S. dollar and rushes to dump their dollar-denominated assets.
When Japan comes to their senses and realizes just how dire the fiscal situation is in the U.S., they will realize that they are much better off investing into their own economy and abandoning the U.S. economy. Just the fact that Geithner is now saying that he doesn’t expect Japan to dump their U.S. treasuries, illustrates just how nervous the U.S. government is about the U.S. dollar and how devastating it would be for all Americans if the Japanese did dump their treasuries. No amount of tax increases and spending decreases will ever allow the U.S. to balance its budget. All the U.S. government can do is talk up a strong U.S. dollar, because they have absolutely no real way to keep it propped up.
All NIA members know that Geithner is perhaps the biggest liar in the U.S. government today. Geithner has long said that the U.S. will not monetize its debt, yet the Federal Reserve is now the buyer of 70% of U.S. treasuries being sold. Foreign central bank purchases of U.S. treasuries have fallen from 50% down to 30%. The days of the U.S. exporting its inflation to the rest of the world are now over.
The U.S. just reported a record budget deficit last month of $222.5 billion, a bigger deficit than the entire year of 2007. Up until today, the U.S. has been paying off its debts plus interest by selling larger amounts of U.S. treasuries to new buyers. This is effectively a ponzi scheme, although the U.S. government will never admit it. Even if Japan doesn’t sell the U.S. treasuries they already own, that won’t be enough for the U.S. to keep this ponzi scheme going. The U.S. needs Japan to keep buying U.S. treasuries, but not only that, they need Japan to buy larger amounts of U.S. treasuries than ever before. The odds of Japan increasing their U.S. treasury purchases during this time of crisis are close to zero, they simply don’t have the financial means to do so.
If Japan doesn’t step up its U.S. treasury purchases, who will pick up the slack, China? Geithner infuriated China last year by calling them currency manipulators and since then, China has been rapidly expanding the yuan’s use in cross border transactions and is now setting up the yuan to be the world’s next reserve currency. NIA believes China is likely to stop buying U.S. treasuries, and will instead loan money to Japan to help in their rebuilding efforts.
It is unbelievable just how many of the economists featured by the mainstream media are calling the disaster in Japan a “stimulus” for not only the Japanese economy, but also the U.S. economy. When a country is forced to rebuild an asset that it already had, it is not stimulating the economy, but is spending resources that could have went towards increasing the production of goods and services. When Japan is eventually finished rebuilding the parts of the country that were devastated this past week, the country isn’t going to be better off than they were before the crisis. They will likely be even more deeply in debt, with less foreign currency reserves, and a much larger money supply. The Nikkei will likely be a lot higher than it is today due to inflation, but the yen will be worth a lot less and the Japanese will be far less wealthy as a result.
America has nothing to benefit from Japan’s rebuilding efforts. Most of the commodities that Japan will import as part of their rebuilding efforts will likely come from Australia, China, and even Canada, with very little of it coming from the U.S. All of the fear and uncertainty in the world today is not going to cause another rush into the U.S. dollar like there was in 2008. When the world dumps risky assets in uncertain situations, the U.S. dollar is going to become one of the risky assets that it dumps. With all of the world’s central banks now fixated on printing money in order to “solve” any short-term economic problems, gold and silver will be the new beneficiaries of all safe haven buying during times of crisis. Don’t let yesterday’s dip in gold and silver fool you. Precious metals were due for a dip and would have sold off no matter what. Now is the time to load up with precious metals before the Federal Reserve begins dropping hints of QE3.
It is important to spread the word about NIA to as many people as possible, as quickly as possible, if you want America to survive hyperinflation. Please tell everybody you know to become members of NIA for free immediately at: http://inflation.us.
From: The Watcher’s Council
Welcome to the Watcher’s Council, a blogging group consisting of some of the most incisive blogs in the ‘sphere, and the longest running group of its kind in existence. Every week, the members nominate two posts each, one written by themselves and one written by someone from outside the group for consideration by the whole Council. Then we vote on the best two posts, with the results appearing on Friday.
This week’s edition is dedicated to the bravery and the spirit of the people of Japan.
You can, too. Want to see your work appear on the Watcher’s Council homepage in our weekly contest listing? Didn’t get nominated by a Council member? No worries.
Simply e-mail me a link at [email protected] with the subject heading ‘Honorable Mention’ no later than Monday 6 PM PST to be considered for our honorable mention category and return the favor by creating a post on your site linking to the Watcher’s Council contest for the week.
It’s a great way of exposing your best work to Watcher’s Council readers and Council members, while grabbing the increased traffic and notoriety. And how good is that, eh?
So, let’s see what we have this week….
- The Noisy Room – Coming Soon… The Daley Czar
- Joshuapundit – Horror Returns; Sleeping Israeli Family Murdered by Arabs, Including An Infant
- The Political Commentator – If a Japanese sovereign debt default was predicted before, what will happen now? (Video)
- Right Truth – A Closer Look at Rep. Keith Ellison’s Past **UPDATED**
- The Colossus of Rhodey – Ignorance And Hypocrisy
- Bookworm Room – The nuclear plant problem in Japan — and the problem with ideologues in science
- The Razor – The Japanese Earthquake Of 2011
- Rhymes With Right – Opposition To Outrageous Pay And Benefits For Public Employees Isn’t Class Envy
- GrEaT sAtAn”S gIrLfRiEnD – Nippon Relief
- New Zeal – Is Richard Trumka a DSA Socialist?
- The Glittering Eye –The Policy Of The One Horse Shay
- VA Right – Are Environmentalists to Blame for Japan’s ‘Meltdown’?
- Simply Jews – How do you tell a moron that…
- Snapped Shot – Calculating Protest Coverage
- The Grouch – Should we be Americans First? Is that a Good Thing?
- Capitalist Preservation – One Flew Over Obama’s Mess
- Divided We Stand, United We Fall – Jackass Journalism
- Theo Spark – Legit Ways To Help Tsunami and Earthquake Victims in Nippon
- The Patriot Post – Democratic Socialism submitted by The Noisy Room
- Mark Steyn/The Corner – Dead Jews Is No News submitted by Joshuapundit
- Pajamas Media – Obama, Wright, Farrakhan, and Gaddafi submitted by The Political Commentator
- Sultan Knish – An Open Letter To Harvey Weinstein submitted by Right Truth
- The Chronicle of Higher Education – The Intellectual As Courtier submitted by The Colossus of Rhodey
- Pajamas Media/Charlie Martin – Fear the Media Meltdown, Not the Nuclear One submitted by Bookworm Room
- Gateway Pundit – Madison Students Will Stay After School… submitted by The Razor
- National Association of Scholars/Andrew Bieszad – Islamo-Correctness at Hartford Seminary submitted by Rhymes with Right
- First Take/CFR – Saudi Arabia’s Missteps Into Bahrain submitted by GrEaT sAtAn”S gIrLfRiEnD
- RBO – Lying Liars: Center for American Progress Cooks the Numbers for Its Fauxroots ‘Main Street Movement’ submitted by New Zeal
- Megan McArdle, The Atlantic – The American President submitted by The Glittering Eye
- Katy’s Conservative Corner – How I Made It With No Health Insurance, No Job, Big Medical Expenses and No Obamacare submitted by VA Right
- Elder of Ziyon – Hamas Attacks Unity Rally In Gaza submitted by Simply Jews
- BLACKFIVE – Brian DePalma has American blood on his hands submitted by Snapped Shot
- Nick Gillespie/Reason – 3 Essential Facts About the Current Moment: We’re Out of Money, The Public Sector is Overpaid, & We Can’t Tax Our Way Out of This submitted by The Watcher
- Shrinkwrapped – Oh No, Are Kidz Can’t Lurn submitted by The Watcher
There’s no excuse for your current failures. 62% of the American people oppose Obamacare. You assured all of us that you would defund it. $105 billion was embedded and appropriated within the bill. You refuse to put a stop to the spending of this $105 billion.
WAKE UP OR GET OUT!
Americans of all political persuasions are screaming “STOP SPENDING!” and yet you refuse to make meaningful and significant cuts to President Obama’s reckless and destructive plans. It was wrong when President Bush did it and it’s wrong now. We can’t change what Bush did in the past, but we can change what Obama is doing. That’s what we sent all of you to Washington to do
Tell the American people the truth. The Government will be shut down by the Democrats if they (Harry Reid and his useful idiots) do not pass legislation which defunds Obamacare and makes significant and meaningful budget cuts. Then create the legislation and get it passed in the House.
Tell the American people the truth… if Democrats cause the Government to shut down, essential operations will continue. Social security and welfare checks will still flow, etc.
This isn’t a game and we’re not going to take it anymore. We’ve shown incredible respect and patience, but our patience has run out and it’s time for you to get serious. Your political deal-making and coercion must stop. You are failing to do the job We The People sent you to do.
WAKE UP OR GET OUT!
It’s not about determining which agencies should be cut, it’s about eliminating all redundant agencies as well as those that are outside the scope of what the Federal Government is constitutionally mandated to do. The only question to be answered is which agencies are to be kept; all the rest are unconstitutional and must be eliminated.
If you’re unable to understand this and move forward on it, then you are unfit to serve.
WAKE UP OR GET OUT!
We’ve given you $305 billion that you can cut from President Obama’s reckless spending right now – today… plus more through elimination of the unconstitutional government agencies currently in operation.
While many keep saying we need to cut Social Security and Medicare/Medicaid, the people are saying, “Cut the wasteful and unlawful government spending first!”
We took time away from our families to ensure that Democrats didn’t win a majority in the House and within states. Why? Because we saw the kind of radical un-American “Change” they offered, we don’t want it and Republicans campaigned on – and we elected you to – halt what they’ve done, STOP SPENDING and STOP OBAMACARE. Your amateurish cow-towing to the Democrats is despicable. You’re allowing them to control the narrative and continue as though the 2010 election never happened.
Republicans will pay dearly in the 2012 primaries if you do not change course immediately.
Either you are incompetent or your perception is severely skewed. Either way, you are unfit to serve the people of this great nation if you continue down your current path. There is no compromise when it comes to doing what’s right for America. There is only ‘Doing what’s right for America.’ Step aside if you’re unwilling or unable to do this. Based on what you’ve demonstrated thus far, it’s time for you to GET OUT! Otherwise, you had better WAKE UP! We’re mad as hell and we’re not going to take it anymore!!
Individuals, families and businesses know that spending more than you take in will increase debt. And the only way to pay down debt is to spend less than you take in. Only the idiots in our government believe you can ‘redefine’ mathematics and somehow get away with your corrupt behavior. We’re here to tell you, “Not anymore!”
Here are more cuts which total $1.65 Trillion. If we, the people, can find a total of $1.955 Trillion to cut, so can you. If you won’t, then it’s time for you to WAKE UP right now, do your job OR GET OUT!
There is no rational explanation for spending taxpayer dollars to send American jobs overseas, to support Communist and Socialist anti-American regimes, to fund abortions and healthcare overseas, etc. Eliminate all of it now. We can’t afford it and it’s outside the scope of the limited powers of the Federal Government.
- $1 billion – to Mexico so that they can drill in the Gulf (while Obama caused 23,000 Americans to lose their job because of his ban on US drilling in the Gulf).
- $2 billion – to Brazil for OFFSHORE OIL DRILLING!!!!
- $665.7 million – International Family Planning & Reproductive Health Programs.
- $63 billion – US Global Health Initiative.
- $30 billion – of the $100 billion per year for UN Climate Change Policy; the UN admitted global warming is about wealth redistribution, not climate change policy.
- $430 billion from TARP that Timothy Geithner stated will be recovered by January 2011 (90% of $700 billion minus $200 billion already recovered) – of which the Fed spent $350 billion in taxpayer funds to save 35 foreign banks.
- $1.9 billion – International Agriculture Programs.
- $54.1 billion – USAID to other countries for FY 2011 – President Obama already sent $173.5 billion for international/foreign assistance ($90.6 billion in 2010 – a 60% increase compared to FY2008; $82.9 billion in 2009 – a 47% increase compared to FY2008).
- $8 billion – US pays to IMF for Greece Bailout.
- $147.3 million – US pays Brazil each year in cotton subsidies to keep its mouth shut.
- $5.96 million – U.S. Ambassadors Fund for Cultural Preservation 2010 Awards (i.e. mosque restoration overseas). NOTE: Section 205.1(d) of title 22 of the Code of Federal Regulations prohibits USAID funds from being used for the rehabilitation of structures to the extent that those structures are used for “inherently religious activities.”
Department of Homeland Security (DHS) has a FY2011 budget of $43.6 billion.
- $18.6 billion of the DHS’s $43.6 billion FY2011 budget (defund the duplicate organizations DHS created).
- $4.1 billion – Half of the TSA budget, which includes a FY2011 $508.7 million increase. It’s time to cut TSA’s $8.2 billion budget in half and the remaining $4.1 billion needs to be used for private companies who can fulfill the needs of airport security in a professional manner that does not violate the 4th Amendment.
- $734 million – FY2011 for DHS to purchase another 1000 scanners.
- $200 million – FY2011 for DHS “to pay state and local costs of securing terrorism-related trials; a 10 percent increase.” We now have military tribunals which make this spending unnecessary.
Government employees, organizations and programs are paid with taxpayer dollars. The more politicians grow government, the more they must take from American citizens and businesses.
- $44 billion – This represents a 28% Pay Decrease for Fed employees (Fed pay increased 36.9% since 2000 while private worker’s pay increased only 8.8%. It’s time to be “fair and equal,” right?)
- $228 billion from TARP that Timothy Geithner said has been returned ($200 billion plus $28 billion in profits). Note that only 27% Have Positive View of Government Bailouts.
- $236.1 billion from Stimulus that the Obama administration claims will not be spent until 2011.
- $5.468 billion – “Civilian” R&D $61.6 billion, which includes an increase of $3.7 billion for FY2011; eliminate the $3.7 billion increase and cut another $1.77 billion from the $61.6 billion, leaving $59.83 billion to spend.
- $2.2 billion – Pay Raises (a 1.4% increase for FY2011 for 2 million Fed employees).
- $148 billion – loaned to Fannie Mae and Freddie Mac – these are government operated organizations that are taking control of 90%+ of U.S. home mortgages and these are the organizations who contributed to the housing meltdown.
- $1.416 billion – Serve America Act FY2011 to recruit our children at school and force “volunteerism” (i.e. recruit and train community agitators).
- $1 billion – Dead people to whom our Federal government sends our money.
- $1.4 billion – FDA to take over our food supply and hire 17,000 more taxpayer-funded government employees.
- $400 million – Michelle Obama’s Food Deserts to open government food stores that are closer to urban areas to save residents the 5 extra minutes of driving time that it takes to get to their existing, privately owned store.
These are just a few of President Obama’s NLC spending priorities for FY2011.
- $10.00 billion – EPA; they’ve failed for decades to do the 1 task assigned… US Energy Independence.
- $1.18 billion – Workforce Development (i.e. special interest slush fund).
- $3.50 billion – Education increase in discretionary funding (i.e. slush fund).
- $4.00 billion – Community Development Block Grant (i.e. slush fund).
- $4.90 billion – HUD budget increase for 2011 (i.e. growth of an incompetent government organization).
- $80 billion to Apollo Alliance (socialist/communist George Soros group) to expand community agitation.
- $422 million – Corporation for Public Broadcasting/NPR – a private company that doesn’t need taxpayer funds.
- $161 million – NEH anti-American group which targets our military.
A few additional spending items planned for FY2011 while our healthcare premiums rise, SEIU halts coverage for over 30,000 children of low-income families, AARP says Obamacare is too expense for them and more than 1,000 Unions and companies that supported Obamacare have now been given waivers because they say they can’t afford it.
- $657 million – Planned Parenthood.
- $51 billion Obamacare increase planned for HHS for FY2011 plus $21.066 billion for FY2011 Recovery Act Budget Authorization as shown in the HHS document on pages 3 and 4.
- $5 billion – Pre-existing condition coverage. Oops, they found that there are only 8,011 people in the entire nation who don’t have this coverage, so the $5 billion would become a government slush fund.
- $17 million – Obamacare Section 203 for civilian “Ready Reserve Corps.”
Between MIT’s research which proves the global-alarmists’ “science” is false, the ClimateGate scandal revealing the lies and the recent admission by the UN that it’s all about wealth redistribution, this spending has to go!
- $1.741 billion – INCREASE for “critical efficiency and renewables programs” – this is just the amount of increase to their existing budget.
- $2.4 billion – “clean tech” for energy efficiency and renewable energy programs, a $2.287 billion increase from $113 million in the previous budget [ID:nN01180827].
- $6 billion – clean energy technologies.
- $535 million – Global warming money for a politically-connected private company, Solyndra, to lay off workers and build a new plant.
- $611.4 million – Bureau of Labor Statistics to gather data on ‘green jobs.’
- $123 million – DoE’s wind program, a $43 million increase over current spending.
- $300 million – the Advanced Research Projects Agency-Energy, or ARPA-E.
Although our government continues to increase spending, the quality of education for our children continues to decline. ENOUGH!
- $17 billion – INCREASE in Pell Grant funding from 2010’s $18 billion budget – the added $17 billion makes the FY2011 budget $35 billion.
- $1.35 billion – Race to the Top challenge.
- $155 billion in YouCut legislation introduced by Republicans – wasteful government spending that Americans voted to cut.