The Month of Shocktober

We have posted several Warning/Situation Updates and we will continue to do so as information dictates.  The solar surface has been relatively quiet, although a still large un-numbered solar sunspot is just beginning to rotate into view and the earth facing sun surface has #1305 and #1313 still earth facing and could still be the sources of a large CME.

In addition, the Canary Islands El Heirro volcano still bears watching.  Swarms of earthquakes are continuing sporadically and have increased in intensity and the depth of the quakes is more shallow,  both of those facts RAISES concern.  Below is the latest press release from Spanish officials.

“October 8, 2011 – CANARY ISLANDS – An intensified sustained earthquake swarm is now taking place at the Canary Islands and it appears the magma is now on the move again bubbling closer to the surface and incinerating more rock in the process. Over the last 24 hours, we’ve seen the depths of the tremors rising up to within 11 km from a depth average of about 14.5 to 15 km. The number of seismic volcanic tremors has also doubled at El Hierro since Wednesday. On Wednesday, October 5, there were 79 recorded seismic events. On Thursday, there were 160 and on Friday, October 7th, there were 177.”

Our concern over this situation is the potential for a large land mass sliding into the ocean creating a mega-tsunami directed at the East Coast of the US and South America.  The focus of this concern is that IF a tsunami were to occur, the East Coast of the Americas would have only 8-9 hours to take any preventive measures.  IF the tsunami were to occur at say midnight EDT, then most of the residents in the danger zone would be asleep, not have any communication devices on during the valuable time they would need to get to safety.

If you live in the areas of potential danger, and until this situation stabilizes, you should think about getting the information you would need in a timely fashion.  This concern is amplified by the fact that the USGS service is not even REPORTING anything on this situation.  We are recommending taking these actions:

1).  You can monitor that activity at The European-Mediterranean Seismological Center . Do so at least twice a day.

2).  As with an emergency plan, make sure you have a way to communicate with each other 24 hours a day.  So as some of you sleep, others are awake and monitoring the situation.  We can’t emphasize enough that in this particular situation, every minute will be precious.

3).  Be sure about your evacuation plan.  Again, those with the information first will be the ones who will most likely be successful in escaping and will not be the ones stuck in grid-lock.  I think you could imagine that the roads will become impassable very quickly when every coastal citizen is trying to go west and to high ground.

However, as we monitor natural dangers, we also monitor financial and political situations as well. Given the current situation in the EU concerning Greece, Italy, Ireland, Spain, and Portugal, and the lack of action and political grid-lock in Germany, France, and to a lesser degree the UK, the collapse of the EU could occur within the next two weeks.  Based on information provided us privately, it is no longer a question of IF, only WHEN, and those in the know say it could be this week coming up (October 10-17^th).

Some would say, OK, why would this be any different than the 2008 financial event in the US?  Well, consider that the EU CANNOT “bail-out” countries like we bailed out banks.  In addition, the bastard child in the room is the world’s derivatives market.  If the EU goes down, investors would only be holding all those credit swaps, etc. which would all be exercised at once.  This is the monster.  It is a $500 Trillion monster!  To put this insanity into perspective, that is almost 10 tens the world’s GDP as estimated by the World Bank for 2010, which was just a little north of $63 Trillion!

This, simply stated, ends the world economy as we know it, and it would all unravel within a matter of 7-10 days.  Markets and banks close immediately, riots ensue within 48 hours and chaos is real for EVERYONE.  We are now elevating our watch of this situation.  Anything that would even trigger rumors at this point could tip the bus over the cliff.  While we have been writing about this since we began, we now see real events beginning to form that toxic situation that could trigger this financial tsunami and soon.

One of the major concerns are the threats being issued by the so-called “Anonymous”, the group believed responsible for kicking off the Occupy Wall Street (OWS) movement.  They have specifically threatened to “attack” the global electronic banking system during this period.  If the markets were forced to close because of such attack, it could be the “gunshot” that panics the herd into a stampede to “preserve” what is left in value in the market.  

We know that these situations all together seem a bit overwhelming.  It makes us step back and want to just go fishing.  However, the reality is we will survive all of this and more!  We simply want everyone to be awake and alert.  It is the LERTS that will survive and we want everyone to survive.  Too many of us have already paid the ultimate sacrifice as a result of the events unfolding.  Each loss is a loss to each and every one of us. Whether it was a soldier or civilian killed in the various wars, or the death of a protestor in Yemen, or the retired “investor” who took their own life because they lost everything, they ARE US.  Knowledge gives us the ability to remain calm, confident, and most importantly the ability to endure and continue.

Keepin’ Myself Honest

Beginning last June or so, I began focusing my blog on the economy, solar activity, natural disasters, and political instability on a global basis.  I tried to understand and focus current events to understand what the near future may hold for us all.  While I don’t try to make predictions, I do try to give people heads up on what I think is coming.I fully understand that there are thousands of sites, threads, and forums dedicated to these “ so-called” alternative news “outlets”.  However, I have no agenda or need for recognition nor any desire for monetary gain, just a desire to share my knowledge and experience, along with my daily efforts to monitor the WORLD events around us.However, such efforts must be evaluated by the facts to insure we are “seeing” the real important issues, and NOT the     and disinformation.  So how did we do?

Thanks to a wonderful article in Homeland Survival I will let you be the judge by evaluating what is considered 32 most important events of the year so far.

January:

New Year’s Eve, 2010 more than 5,000 dead red-winged blackbirds and starlings were found in Beebe, Arkansas.

3^rd-5^th) 100 tons of dead fish washed ashore the Brazilian coast, near the port of Paranagua. 2 million fish died in Chesapeake Bay, Maryland, thousands of dead turtle doves were found in Faenza, Italy.

Egypt, the most populous country in the Arab world, erupted in mass protests.

10^th) At least 8 people are dead and over 70 missing after massive flooding ravages Brisbane, Australia.

Feburary:

14^th) Unrest in Middle East Spreads to Bahrain

14^th) Sun Erupts With Most Powerful Solar Flare in Four Years

22^nd) A 6.3-magnitude earthquake hits Christchurch, New Zealand, killing at least 75 people.

March:

19^th) No-Fly Zone is Imposed in Libya

11^th) Massive 9.0 Magnitude Earthquake and Tsunami Devastate Japan

April:

1^st) Possible Shutdown of Federal Government Goes Down-to-the-Wire

27^th) Series of Tornadoes Devastate Southern States. In one of the worst U.S. tornado seasons, 137 reported tornadoes sweep through the south, killing nearly 300 people in six states.

May:

5^th) Floods Force Evacuations along the Ohio and Mississippi Rivers

22^nd) One of the Deadliest Tornados in U.S. History Hits Joplin, Mo.

June:

1^st) Tornados Continue to Strike in the U.S. For the first time in three years, seven tornadoes touch down in Massachusetts.

3^rd) Unemployment Rises as Job Growth Slows

5^th) Toxic E. Coli Outbreak Linked to German Sprouts

6^th) Flooding in Iowa Forces Hundreds to Flee

11^th) Wildfires Rage Through East Arizona. Two fires in Arizona merge into one runaway 600-square-mile blaze becoming the largest fire in Arizona’s history.

July:

1^st) Minnesota Government Shuts Down

1^st) New Mexico Wildfire Rages On

22^nd) Two Related Terrorist Attacks Shock Norway

August:

1^st) Last Minute Deal Reached to End Debt Crisis

5^th) Standard & Poor’s Lowers the U.S. Credit Rating

6^th) Violent Riots Spread Throughout Britain

8^th) Stocks Nosedive After U.S. Credit Rating Is Lowered

8^th) Mystery orange goo invades Alaska village

11^th) East Africa Hit with Worst Drought in 60 Years

Heat wave in Texas grips state with 100 degree temperatures for over a month

23^rd)  5.8 Virginia earthquake shakes east coast

26^th) Hurricane Irene hits the east coast, millions lose power.

September:

Texas Wildfires destroy 1554 homes

8^th) Power outage leaves 1.5 million in the dark in California, Arizona and Mexico

*9^th) Four Major Solar CMEs and X-Ray events with more predicted in the next four to six days.

*11^th) President Obama gives an almost cryptic warning in his 9/11 address.  Everyone should re-listen to that address in context to what you just reviewed.  * added by this editor since article was published.

Natural disasters, unexplained events, historic drought and flooding, economic uncertainty, civil unrest, and terrorism are the things we may face at anytime. You may not have been directly affected by the events listed here but events around the world can quickly change our daily life. We don’t know what tomorrow will bring but as we have seen so far this year, it might be a good idea to be prepared for whatever tomorrow brings.

Given the predictions for the increase in solar activity and the almost certain collapse of the EU within the next month I would hope we are ready.  On the financial side, I hope you are all sitting on the sidelines with your popcorn watching the show.  The markets are no place for arm chair investors right now.  Hell, it’s no place for pros either right now.

On the survival side, simply think what you need to do if you have no power for say 2 weeks and prepare for that contingency.  I think we have more than a 60% chance of that happening in the next thirty days.

However, even more important than all these things, I think you should not believe your lyin’ eyes as you watch the news for the next 30 days.  As political and financial system begin this final collapse phase of business as usual, in the PTB circles, things are beginning to be a bit frantic.  Just remember desperate people do desperate things.

Ultimately though, take care of each other.  We all act as one in face of challenges and disasters.  This must now, unfortunately, become daily habit.  We are all really in this together.  Live peacefully in love and compassion.  It really is the most important contribution you can make to getting things “right”.

The Arab Spring, The European Summer, and An Americans Fall

As the economy continues to collapse and various sovereigns try to institute the austerity programs that are being demanded by the bankers, we have reached the point I have been writing about for over a year.  The riots have broken out on every continent.

In the last week alone there have been major riots in England, Chile, Israel, China, and the US.  These riots are in addition to  the riots that are on-going in Egypt, Libya, Syria, Iran, and Lebanon.  There is no longer any doubt that the Global Revolution has begun.

Words and discussions certainly can help us understand, but understand what?  The fact these riots have begun is simple.  When hope is no longer visible to the masses and basic essential needs of food, shelter, employment, and health care are not met, all Hell will break loose!  Any military veteran will tell you that the most fearless warriors are the hungry ones with no other options.

But I think the following photo journal  of the week’s activities will say it all

The London Riots

The Riots in Chile

The Riots in Israel

 

The Riots in San Francisco

The next few months are truly dangerous times.  The level of tension is high and the actions of those in charge to stabilize the situation are woefully absent.  My advice is if possible, stay isolated and prepared to survive on your own for 1-4 weeks.  I fear a gross over reaction from various enforcement forces and certainly a military action against the various domestic citizens.  Secondly, most of the riots are involving massive looting which only justifies the over reaction of the various police and military.

Making Sense of the Events in The Middle East

MSM tends to report the events in Egypt, Yemen, Tunsia, Bahrain, Syria, and Libya as if they were all the same.  The same MSM, both western and Arab tend to paint the involvement of the EU, UK, and the US as purely self interests related to oil.  In both cases to do so does not create an understanding of the real complex and in all cases, country specific issues.  Nor does these same western countries relate the events in the region to events at home in their own countries.

Let’s address the “oil” issue first. The truth is that the entire global economy, including the side-liners like Russia, China, and India economies,  must have a SECURE supply of oil.  If anyone of these nations were really “after the oil”, Kuwait would be a US territory as well as Iraq.  That is not the case in either country and the US pays MARKET price to these countries for their oil, just like everyone else.  The same could be said of the european countries as related to Libya.  So from my perspective and vantage point, the oil imperialism argument, primarily kept in the mainstream by Iran, is just a red herring argument.

When we look at the divisions within the Arab countries, Iran is the nation, fomenting the issues.  What most Westerners fail to grasp is the fact that while Iran is primarily a Shia nation, they are NOT Arabs!  Iran is Persian.  One only has to look deeply at how Iran has constantly be meddling in the affairs of Iraq to understand why there is more concern in the Arab world over the activities of Iran than there are concerns about Western interference.

That is not to say that the Arab countries are all that secure with their relationships with the US and EU, but these concerns are more related to the consistency that may be demonstrated by the US and the EU and NATO related to assisting in the security and protection of Arab countries in relationship to Iran.  these concerns are well founded and have resulted from the fickle manner in which both the US and NATO have acted in the past.  These concerns were voiced again when US Secretary Gates visited Saudi Arabia last week.

The GCC countries are especially worried about the Iranians , their aggressiveness in the region, and their ability to disrupt the flow of oil to the world.  GCC foreign ministers on Sunday condemned Iran’s “blatant” interference in the State of Kuwait’s internal affairs, accusing Iran of “planting espionage networks on [Kuwait's] territory” to undermine the country’s security and stability and the interests of its citizens. In a statement issued at the conclusion of their extraordinary one-day meeting, the foreign ministers commended Kuwait’s security bodies for uncovering the sleeper cell of spies believed to be working covertly on Iran’s behalf. The ministers also affirmed their support for all the measures taken by the State of Kuwait to protect its national security.

The statement further noted that the senior government officials had expressed concern at what they called “continuous Iranian interference in the domestic affairs of the GCC countries, by conspiring against those nations’ national security … and instigating sectarian sedition between their GCC countries’ citizens, independence, principles of good neighborliness, international laws, the Charter of the UN and OIC.” The foreign ministers also welcomed the return of calm and stability to the Kingdom of Bahrain, praising the spirit of the Bahraini people who it said had sought the country’s higher interests.

Bahrain has the capabilities and wisdom to dealing with its internal affairs, said the ministers, whilst stressing that they “strongly condemn the Iranian interference” in Bahrain’s affairs. The senior government officials also stressed the legitimacy of the deployment of Peninsula Shield forces in Bahrain, which they indicated was compliant with an earlier defense agreement binding the six GCC countries – Kuwait, Saudi Arabia, Bahrain, Oman, Qatar and UAE.

The GCC ministers further condemned the Iranian Shura Council’s national security and foreign affairs committee’s statement which claimed that Saudi Arabia’s policy was “playing with fire.” The Iranian statement, which also called on Saudi Arabia to pull out forces from Bahrain, “is a hostile position and is a provocative interference in the internal affairs of the GCC countries,” the ministers warned.

On Yemen, the foreign ministers voiced great concern over the deterioration of security and the growing divisions in the country, a matter that would undermine interests of citizens and economy as a whole. They called on all parties in Yemen to launch dialogue to ultimately reach reform and bring about social stability. The ministers said they respected the wishes and choices of the Yemeni people, adding that they would be establishing contact with the Yemeni government and opposition to address the conflict

Also on Sunday, the UAE’s Foreign Minister Sheikh Abdullah bin Zayed Al-Nuhayyan said that there is a “huge contradiction” between Iran’s words and its deeds towards the GCC countries. “The espionage networks that were arrested in the State of Kuwait are strange [things to] happen from a neighboring country that always claims to have good neighborly relations with us,” Sheikh Abdullah told a joint news conference with GCC Secretary General Abdullatif Al-Zayyani that followed the ministers’ meeting.

The Gulf Cooperation Council (GCC) countries are firmly behind the Bahraini King’s request to send Peninsula Shield forces to the Kingdom, he reiterated. Concerning events in Yemen, meanwhile, Sheikh Abdullah said the GCC countries would be contacting the government and opposition parties there in a bid to resolve their conflict. Al-Zayyani on his part said that there are currently numerous challenges facing the GCC countries, further reiterating the member states demand for “other countries not to interfere in the GCC countries’ affairs.

Meanwhile, Kuwait’s caretaker foreign minister Sheikh Dr. Mohammad Al-Sabah told a Kuwaiti daily Al-Qabas via phone following the meeting that the talks, as well as the concluding statement, “reflect the collective spirit of the GCC,” indicating that “GCC Foreign Ministers insisted on the common united fate of GCC countries,” whilst also noting that the Bahraini subject and current events in Kuwait were equally addressed during the meeting and stressing the cohesion of the GCC as a single unit. “The GCC proved to be capable of meeting its responsibilities, and showed that to the security of member states…meaning a threat to any GCC state is regarded as a threat to all countries of the region”.

Meanwhile, in the same article, Al-Qabas, also quoted GCC insiders as saying that the foreign ministers had agreed during the meeting that all the member states’ capabilities would be utilized to confront any potential threats against any member state. The sources further indicated that the senior government officials agreed on the principal measures that should be taken to face any Iranian threats, adding that an agreement was also reached to hold further top-level GCC meetings featuring senior security and defense personalities within the next couple of days to discuss the type of measures to be taken and the strategies to be utilized for their implementation.  The insiders further asserted that the GCC foreign ministers were unanimous in stressing the importance of eliminating “suspicious individuals” in member states, while ensuring that this process is not based on group identity. Other sources also revealed that an agreement was reached to “reinforce internal fronts” in the member states in order to confront any attempts to incite sectarianism.

Given these issues and the economic situations in each of the countries now experiencing internal conflicts it is crucial for the US, the EU, and NATO to develop a consistent and strong policy to support it’s vital Arab partners.  Players like Russia, China, and India are sitting on the sidelines looking for opportunities to exploit the failures of the US and EU policy in the region.  So far, their decision to remain on the sidelines, and even tacitily support Iran seems to have traction.  The politicians in the US and EU better get their act together before oil goes to $200 or $300 per barrel.  Commit to their Arab partners and support them unconditionally.

Global Revolution Must Occur

Some are looking the phenomena occurring in the Middle East as if somehow it is unique to that region and we would like to believe it is related to monarchies or religion.  I assure you nothing would be further from the truth and the facts.  I just returned from the region.  I was in fact in the streets the night Mubarak stepped down.  It is about a dignified living.

Now, in the US we have stirrings in Wisconsin, Indiana, New York, and Ohio.  We witnessed the “in-your-face” fake David Koch call to Governor Walker of Wisconsin.  What is happening in Wisconsin will spread everywhere.  Governors are meeting in Washington today to discuss the overwhelming $175 Billion budget shortfalls collectively facing the states.

However, attempting to bust unions and collective bargaining in the face of the enormous tax cuts given to the ultra wealthy is just not going to sit here as it has not been accepted globally.  There is a moment when the masses do their own math and guess what doesn’t add up?  Distribution of wealth in the society is the problem.  It is that simple and it has reached the event horizon.

The PTB and their political hacks actually still believe they can maintain their power structure and as a result they move forward with the methodical destruction of the world’s middle class as the “cost” to maintain their position.  Their solution: just print more money everywhere! Consider this great reporting by Michael Snyder – BLN Contributing Writer.

“If the U.S. dollar is being devalued so rapidly, then why does it sometimes increase in value against other global currencies?  Well, it is because everybody is recklessly printing money now.  The 6 charts which you are about to see below prove this.  The truth is that it is not just the U.S. Federal Reserve which has been printing money like there is no tomorrow.  Out of control money printing has also been happening in the UK, in the EU, in Japan, in China and in India.  There are times when one particular global currency will fall faster than the others, but the reality is that they are all being rapidly devalued.  Unfortunately, this is a recipe for a global economic nightmare.

Right now you can almost smell the panic as it rises in global financial markets.  Investors all over the world are racing to get out of paper and to get into hard assets.  Just about anything that is “real” and “tangible” is hot right now.  Gold hit a record high last year and it is on the rise again.  In fact, it just hit a new five-week high.  Demand for silver is becoming absolutely ridiculous right now.  Oil is marching up towards $100 a barrel again.  Agricultural commodities have exploded in price over the past year.  Many investors are even gobbling up art and other collectibles.

Paper money is no longer considered to be safe.  All over the globe investors are watching all of the reckless money printing that has been going on and they are becoming alarmed.  An increasing number of investors and financial institutions are putting their wealth into hard assets that are real and tangible in an effort to preserve their wealth.

The other day, a reader of this column named James sent me some charts that he had put together.  I thought they were so good that I asked him if I could include them in an article.  These charts show how central banks all over the globe have been recklessly printing money.  Over the last 30 years virtually the entire world has developed a great love affair with fiat currency….

So is everyone printing money?

The U.S. is printing lots of money…..

Source, The St. Louis Fed

The Bank of England is printing lots of money…..

Source: The BoE

The EU is printing lots of money….

Source: The ECB

Japan is printing lots of money…..

Source: The BoJ

China is printing lots of money…..

Source: The People’s Bank of China

India is printing lots of money…..

Source: Reserve Bank of India

Of course anyone with half a brain can see where all of this is ultimately headed.  In the end, inflation is going to spiral out of control and we are going to witness financial implosion on a global scale. So why don’t these nations just adopt sound money?

Well, it turns out that if you are a member of the IMF, you are specifically prohibited from having gold-backed currency.  Yes, you read that correctly.

In fact, U.S. Representative Ron Paul once sent an open letter to the U.S. Treasury and the Federal Reserve asking about this and he received no response.  The following is the content of that letter….

Dear Sirs:

I am writing regarding Article 4, Section 2b of the International Monetary Fund (IMF)’s Articles of Agreement. As you may be aware, this language prohibits countries who are members of the IMF from linking their currency to gold. Thus, the IMF is forbidding countries suffering from an erratic monetary policy from adopting the most effective means of stabilizing their currency. This policy could delay a country’s recovery from an economic crisis and retard economic growth, thus furthering economic and political instability.

I would greatly appreciate an explanation from both the Treasury and the Federal Reserve of the reasons the United States has continued to acquiesce in this misguided policy. Please contact Mr. Norman Singleton, my legislative director, if you require any further information regarding this request. Thank you for your cooperation in this matter.

Ron Paul
U.S. House of Representatives

Sadly, the truth is that the global elite don’t want nations to start adopting gold-backed currencies.  They want countries to use fiat currencies that they can openly manipulate for their own benefit.

At this point, every nation on earth (to the best of my knowledge) uses a fiat currency.  All of the major global currencies are being continually devalued.  In fact, there are times when counties will purposely devalue their currencies even more rapidly in order to gain a competitive advantage in world trade.

This is why so many investors now have such an aversion to paper currency.  It starts losing value the moment you take possession of it.  In some areas of the world, “gold fever” is absolutely exploding.  For example, China imported five times as much gold in 2010 as it did in 2009.  On the Shanghai Gold Exchange, trading volume soared 43 percent during the first 10 months of 2010.

And while these reckless monetary policies continue, consider the fact that NOT ONE individual has faced any kind of criminal charges in the 2008 collapse, NOT ONE.  However, the “Baby Ruth” always floats to the top of the pool.  Consider this just out over at the Huffington Post.

Source: Huffington Post

Goldman Sachs collected $2.9 billion from the American International Group as payout on a speculative trade it placed for the benefit of its own account, receiving the bulk of those funds after AIG received an enormous taxpayer rescue, according to the final report of an investigative panel appointed by Congress.

The fact that a significant slice of the proceeds secured by Goldman through the AIG bailout landed in its own account–as opposed to those of its clients or business partners– has not been previously disclosed. These details about the workings of the controversial AIG bailout, which eventually swelled to $182 billion, are among the more eye-catching revelations in the report to be released Thursday by the bipartisan Financial Crisis Inquiry Commission.

The details underscore the degree to which Goldman–the most profitable securities firm in Wall Street history–benefited directly from the massive emergency bailout of the nation’s financial system, a deal crafted on the watch of then-Treasury Secretary Henry Paulson, who had previously headed the bank.

“If these allegations are correct, it appears to have been a direct transfer of wealth from the Treasury to Goldman’s shareholders,” said Joshua Rosner, a bond analyst and managing director at independent research consultancy Graham Fisher & Co., after he was read the relevant section of the report. “The AIG counterparty bailout, which was spun as necessary to protect the public, seems to have protected the institution at the expense of the public.”

Goldman and AIG both declined to comment.

When news first broke in 2009 that Goldman had been an indirect beneficiary of the AIG bailout, collecting the full value of some $14 billion in outstanding insurance polices it held with the firm, the officials who brokered the deal justified these terms as a necessary stabilizer for the broader financial system. As the world’s largest insurance company, AIG’s inability to cover its outstanding obligations could have threatened the solvency of the institutions holding its policies, asserted the Federal Reserve Bank of New York, which oversaw the deal.

Goldman fended off claims that the arrangement amounted to a backdoor bailout by asserting that none of the money from the AIG rescue landed in its own coffers. Rather, those funds went to compensate clients or institutions on the other side of its trades, Goldman said.

Many times in past posts, I have both predicted and worried over what a violent reaction would look like in say the US or the UK.  Now more than ever, I see the kindling for such a fire is about to be lit.  I only hope that the people, when they do stand up, do so peacefully.  If there is any lesson we can learn from Tahrir Square was the dignified and resolute manner in which the people imposed their will.

Trends For 2011

As we begin 2011, I want to thank my readers for their support and their inputs for the site during 2010.  It appears that more and more folks are interested in knowing “the rest of the story”.  Traffic on the site expanded seven fold during the year.  Interestingly, there were also a numerous amounts of inquiries asking to “buy ad space” on my site.  Just for the record, this site is and always will be 100% sponsor free.  It is a simple philosophy. This site is responsible to everyone and beholding to none.  As the jackboots start attacking the web this year in earnest, and they will, we will try to stay visible as long as possible.

As we face the beginning of 2011we wonder “what next”.  When we look back at 2010, it played out much like we anticipated.  Last spring, we said look out for the summer of hell.  Between the weather and the economy, I think my European readers, especially, would agree it could have been called “hellish”. I believe the lack of economic recovery has created hellish situations in more than 150,000,000 families globally who lost their homes and jobs.

So what is next?  Let’s start with what the Trends Research Institute has published.

By Gerald Celente – Trends Research Institute

KINGSTON, NY, 28 December 2010 — After the tumultuous years of the Great Recession, a battered people may wish that 2011 will bring a return to kinder, gentler times.  But that is not what we are predicting:

1.  Wake-Up Call  The people of all nations, having become convinced of the inability of leaders and know-it-all “arbiters of everything” to fulfill their promises, will do more than just question authority, they will defy it.  The seeds of revolution will be sown….

2.  Crack-Up 2011  In 2011, with the bailout funds and arsenal of other schemes to prop up the economy depleted, teetering economies will collapse, currency wars will ensue, trade barriers will be erected, economic unions will splinter, and the onset of the “Greatest Depression” (a trend we forecasted before the massive bailouts existed) will be recognized by everyone….

3.  Screw the People  As times get even tougher and people get even poorer, the “authorities” will intensify their efforts to extract the funds needed to meet fiscal obligations.  While there will be variations on the theme, the governments’ song will be the same: cut what you give, raise what you take….

4.  Crime Waves  No job + no money + compounding debt = high stress, strained relations, short fuses.  In 2011, with the fuse lit, it will be prime time for Crime Time.  As Gerald Celente says, “When people lose everything and they have nothing left to lose, they lose it.”  And “lose it” they will….

5.  Crackdown on Liberty  As crime rates rise, so will the voices demanding a crackdown.  A national crusade to “Get Tough on Crime” will be waged against the citizenry.  And just as in the “War on Terror,” where “suspected terrorists” are killed before proven guilty or jailed without trial, in the “War on Crime” everyone is a suspect until proven innocent….

6.  Alternative Energy  In laboratories and workshops unnoticed by mainstream analysts, scientific visionaries and entrepreneurs are forging a new physics incorporating principles once thought impossible, working to create devices that liberate more energy than they consume.  What are they, and how long will it be before they can be brought to market?

7.  Journalism 2.0   2011 will mark the year that new methods of news and information distribution will render the 20th century model obsolete.  With its unparalleled reach across borders and language barriers, “Journalism 2.0” has the potential to influence and educate citizens in a way that governments and corporate media moguls would never permit….

8.  Cyberwars   In 2010, every major government acknowledged that Cyberwar was a clear and present danger and, in fact, had already begun.  The demonstrable effects of Cyberwar and its companion, Cybercrime, are already significant – and will come of age in 2011.  Equally disruptive will be the harsh measures taken by global governments to control free access to the web, identify its users, and literally shut down computers that it considers a threat to national security….

9.  Youth of the World Unite  University degrees in hand yet out of work, in debt and with no prospects on the horizon, feeling betrayed and angry, young adults and 20-somethings are mad as hell, and they’re not going to take it anymore.   Not mature enough to control their impulses, the confrontations they engage in will escalate disproportionately….

10.  End of The World!  The closer we get to 2012, the louder the calls will be that “The End is near!”  Among Armageddonites the actual end of the world, and annihilation of the Earth in 2012, is a matter of certainty.  Even the rational and informed may sometimes feel the world is in a perilous state.  Both streams of thought are leading many to reevaluate their chances for personal survival, be it in heaven or on earth….

Gonzalo Lira, one of the most prolific bloggers on the EU economy, thinks as I do that Europe is in deep shit—there’s really no polite way to say it. Back in the spring of 2010, Greece went down the tubes, as its sovereign debt collapsed in price, and its ability to borrow money from the open markets—and thereby continue to operate—for all intents and purposes ceased.

Then in November/December of 2010, the Irish sovereign debt also began to tumble, as it became increasingly clear that Ireland simply does not have the wherewithal to backstop it’s disproportionately large—and insolvent—banking sector. Angela Merkel’s less than clever words in an interview (to the effect that Irish debt holders might have to take a haircut) sparked a rise in Irish debt yields, squeezing Ireland’s ability to borrow fresh cash to keep its insolvent banks afloat—thereby creating the need for a rescue package from the IMF, the UK, the European Union, and the European Central Bank. What was painfully apparent in 2010 was that the Eurozone and the European Union had no mechanism to handle a crisis in one of its member states. Nor is it moving forward to correct the single biggest weakness of the euro scheme—namely, the ability of each member state to issue its own debt.

Possible EMU Collapse: What To Pay Attention To In 2011. After the Greek and Irish bailouts, it looks like Portugal and possibly Belgium are up next in this perverse game of musical chairs played to the tune of sovereign debt, but these smaller countries are dwarfed by Spain: Spain is where the European game is really at.

As Lira pointed out, Spain is twice the size of Greece, Ireland and Portugal combined—Spain is roughly half the size of Germany—Spain has a fiscal deficit of over 11% of GDP for 2010, and a total debt of over 80% of GDP, data here (I am counting the accumulated debt of comunidades autónomas, which is so far 10.2% of GDP and steadily rising; data here)—Spain has an unemployment of over 20%—in short, Spain is trouble. Not “Spain is in trouble”—that’s obvious, but that’s not my point: Spain is trouble, trouble for the German banks that own so much of the Spanish debt. Trouble for Germany, which is propping up its insolvent banks (What, you think German politicians are any less craven than American politicians?). Spain is trouble for the European Union, for what a German banking crisis might mean for the EU as a whole and as an institution.  More than anything, Spain is trouble for the European Financial Stability Facility, because Spain is too big to be saved—and there’s really no way to finesse that hard fact.

Do you know what a lynchpin is? According to the dictionary, a lynchpin is “a pin passed through the end of an axle to keep the wheel in position”. Hence the figure of speech: Without a lynchpin, the wheel comes off, and the whole vehicle crashes. In the case of Europe, the lynchpin can come off awfully fast—think of Ireland. A few impolitic words from Angela Merkel, and suddenly the Irish bond market panics. Suddenly, Ireland is teetering on the brink of insolvency, unable to meet its funding needs. And that was Ireland—all due respect to those wonderful people, but we’re talking a GDP of a paltry $227 billion. Ben Bernanke takes a morning dump bigger than that. What’s Ireland’s $227 billion when compared to Spain’s economy of $1.5 trillion?

How the EU and the ECB handle an eventual Spanish sovereign debt crisis will determine the very future of the European Union.  If the EU and the ECB are clever, and brave, and humble in the face of failure, then they’ll expel Greece, Ireland, Portugal, Spain and Italy from the European Monetary Union. The euro will remain the currency of the stronger economies—France, Holland, Germany—while the weaker economies will go back to their original currencies, and immediately devalue so as to kickstart their economies.

In the US, I believe we are going to see the dollar fail three times in 2011.  First, the dollar is going to be challenged against the Euro.  It will fail, but shortly there after, the Euro will begin its  final demise.  Then the dollar will be challenged as the world’s reserve currency, and once again it will fail and about this time everyone in mainstream media will introduce the world to the Bancor.  Finally,  the federal reserve note will be challenged as the US currency.  Already we are seeing many areas and communities developing alternative currencies in the US.

Commodities rose drastically all throughout 2010: Every single commodity class, every single one of them rising by double digit percentage points—at least.  The winter weather globally will cause huge impacts to food supplies and hyperinflation will rear its ugly head everywhere.

However, I think the most serious stories and realities of 2011 will be civil unrest.  People all over the world have lost faith in their governmental bodies and hungry, homeless, hopeless people are really going to start taking actions, and most of those actions will be violent and irrational.  This is going to invoke governmental response and things are going to escalate quickly.

So, bottom line, if you haven’t followed my advice in 2010, I ask you to reconsider this one question.  If you wake tomorrow morning and there is no job, no food, no utilities, and soldiers on your street to maintain order, are you ready to survive for the next three months without leaving your home?  Are you? I want to wish you all a Happy New Year, but this year, I hope you accept my sincerest wishes to have a safe and secure New Year.

The Insanity on the Currency Warfront

As I have chronicled the global financial meltdown, I have been amazed at the number of economists, traders, and politicians that seem to be in complete denial of the facts of the current crisis and at each step either they have reacted in exactly the opposite manner required to respond to the crisis, or they have failed to act at all for self-centered political reasons.  Some examples include banks sitting on huge cash reserves instead of stimulating the economy, the US CONgress adding $1.3 trillion in new debt with tax cuts, central banks everywhere printing money willy-nilly without regard to the consequences. But most of all, we, as citizens and the main participants in the economy merrily skipping down the road without a care in the world.  That is until you are homeless and hungry, then the feelings are anger and despair.

Then the other day, I had a conversation with an old friend who was a forensic psychologist for one of the US Government alphabet agencies.  He is retired now, but his job was a “profiler”.  He would investigate crimes and other “stuff” to help the agents understand the make-up of the criminal or spy and maybe predict “next” moves.  When I lamented about those around me who I love and respect being in complete denial as to the grave nature of the current economic situation, he explained that this is a very natural response to extreme crisis and distress.  It is called Normalcy Bias.

In short, when humans are faced with natural disasters or a man-made crisis that overwhelms them, they simply slip into complete denial.  Logic and intelligence functions stop.  He pointed out some startling examples.  Consider this.  In Germany in 1937 there were nearly 550,000 Jews.  Long established the Jewish German community was rift with businessmen, intelligentsia, professional people who were just beginning to enjoy a good life again after recovering from World War One.

As Hitler rose to power with his hate mongering and obsession with the Jewish community, it became very apparent that the Jewish community was facing more and more injustices.  Property seizures, business taxed at 100%, lose of civil rights, street beatings by the Brown Shirts, still they did not understand the danger they were in and believed being rational and calm would weather them through the storm.  Only about 100,000 Jews fled in time.  We know the tragic end to that story.

However, things are heating up on the currency warfront.  This week saw many assaults on the US Dollar.  Let me stop here and talk some basics.  Currently the US policy and the FED policy simply has been to print more money.  The US enjoys a unique position when it comes to currency because the US dollar is the world’s transactional currency.  For example, if Germany wishes to buy oil, it must first convert Euros to Dollars to purchase the oil.

However, keeping the dollar as the global transactional currency only lasts as long in the faith of the value of the dollar remains in the rest of the world.  The US actions of the last week, both at the FED and CONgress have gone a long way to weaken that faith.  What is happening is both countries and companies are choosing to use other methods to transact business.

So we are beginning to see news items like this. In spite of its infancy, interest in the offshore renminbi market is growing quickly. Caterpillar, the US-based maker of earth-moving equipment, launched a Rmb1bn ($150m) bond issue last month, making it the second multinational to tap the market, following an August issue by McDonald’s, the fast-food chain.

What makes these bond issues important is that the offshore renminbi market is much more than just a new avenue for debt financing – it is one of the core components in a plan to internationalize the Chinese currency. The process will be a slow one, with more baby steps than giant leaps, and it is by no means assured that the renminbi – also known as the yuan – will forge a decisive international role. But it is one that could have a huge long-term impact on trade, the global financial system and even international politics.

If the plan works, the renminbi could become the main currency for doing business in Asia, the world’s most economically dynamic region, and in the long run it could become a significant part of the reserves of the world’s central banks. Indeed, some Chinese officials have already called for the renminbi to be included in the International Monetary Fund’s basket The timing is also full of portents. The renminbi is starting to go global just as the future of the euro and the dollar is looking increasingly uncertain. Eventually the shift could have an impact on the ability of the US to borrow overseas in its own currency. In China, some have taken to calling their currency the hongbi, or “redback”, to rival America’s greenback – a moniker that gives a flavour of the geopolitical undercurrents.

“We may be on the verge of a financial revolution of truly epic proportions,” says Qu Hongbin, China economist at HSBC, one of the banks pushing the renminbi to its corporate clients. “The world economy is, slowly but surely, moving from greenbacks to redbacks.”of main currencies.

So even though the Fed has flooded the credit markets with cash, spreads haven’t budged because banks don’t know who is still solvent and who is not. This uncertainty, says Ms. Schwartz, is “the basic problem in the credit market. Lending freezes up when lenders are uncertain that would-be borrowers have the resources to repay them. So to assume that the whole problem is inadequate liquidity bypasses the real issue.”

Today, the banks have a problem on the asset side of their ledgers — “all these exotic securities that the market does not know how to value.” “Why are they ‘toxic’?” Ms. Schwartz asks. “They’re toxic because you cannot sell them, you don’t know what they’re worth, your balance sheet is not credible and the whole market freezes up. We don’t know whom to lend to because we don’t know who is sound. So if you could get rid of them, that would be an improvement.”

And economics professor and former Secretary of Labor Robert Reich wrote in 2008:

The underlying problem isn’t a liquidity problem. As I’ve noted elsewhere, the problem is that lenders and investors don’t trust they’ll get their money back because no one trusts that the numbers that purport to value securities are anything but wishful thinking. The trouble, in a nutshell, is that the financial entrepreneurship of recent years — the derivatives, credit default swaps, collateralized debt instruments, and so on — has undermined all notion of true value.

What everyone here is cryptically referring to is the credit derivatives and credit swap facilities which no one knows the value of when conducting a transaction.  Indeed only nine major banks control this $1 quadrillion market.  No I didn’t make a mistake, I said $1 quadrillion! We were just getting our heads around what a trillion really meant.  Here is the fundamental problem with this situation. $1 quadrillion represents about 20 times the Global GDP!  This is pure insanity.  There is no other way to describe what is going on right now.

Economists focus on the whole notion of incentives. People have an incentive sometimes to behave badly, because they can make more money if they can cheat. If our economic system is going to work then we have to make sure that what they gain when they cheat is offset by a system of penalties.

Wall Street insider and New York Times columnist Andrew Ross Sorkin writes:

“They will pick on minor misdemeanors by individual market participants,” said David Einhorn, the hedge fund manager who was among the Cassandras before the financial crisis. To Mr. Einhorn, the government is “not willing to take on significant misbehavior by sizable” firms. “But since there have been almost no big prosecutions, there’s very little evidence that it has stopped bad actors from behaving badly.”

Indeed, polls show that people no longer trust our economic “leaders”. See this and this. A psychologist wrote an essay published by the Wharton School of Business arguing that restoring trust is the key to recovery, and that trust cannot be restored until wrongdoers are held accountable.

Government regulators know this – or at least pay lip service to it – as well. For example, as the Director of the Securities and Exchange Commission’s enforcement division told Congress:

Recovery from the fallout of the financial crisis requires important efforts on various fronts, and vigorous enforcement is an essential component, as aggressive and even-handed enforcement will meet the public’s fair expectation that those whose violations of the law caused severe loss and hardship will be held accountable. And vigorous law enforcement efforts will help vindicate the principles that are fundamental to the fair and proper functioning of our markets: that no one should have an unjust advantage in our markets; that investors have a right to disclosure that complies with the federal securities laws; and that there is a level playing field for all investors.

If people don’t trust their government to enforce the law, government will become more and more impotent in addressing our economic problems. If government leaders take action, the market will not necessarily respond as expected. When government leaders make optimistic statements about the economy, people will no longer believe them.

Then also on the warfront, China and Russia announced they will trade in their own currencies.  In addition, the IMF recently released a report suggesting that given the weakness of the Euro and the Dollar, we should be moving toward a global central bank and a single global currency, which they are calling the Bancor. Several banks no longer are accepting deposits in dollars.

What does this really mean and why should you care about it.  I have one word for you, hyperinflation.  The world is currently pushing back on US policies and are demanding that either the US deal effectively with the deficit or devalue the dollar.  When the pressure gets strong enough, and I believe that could be as soon as the next three months, the US will acquiesce and devalue the dollar by as much as 40%.

This will happen suddenly and overnight!  You will wake up to $8 gas, $5 bread, a 4000 point dip in the Dow and events will rapidly cascade from there to riots in the streets of the US just as we have riots now in Ireland, Greece, Italy, France, and Britain.  The war is reaching fever pitch.  Pay close attention now because bunker time may not be far off.

Further Posts from the Currency Warfront

The assault on the EU and the Euro is in full force now.  It was nearly a year ago that I predicted that some of the final fronts in the Great Economic War was the assault on pension funds and the profound effects the fallout from those raids would have on the general population.  Nearly every major G20 member nation is now in full on raids of their pension funds as we speak.  We can expect several million causalities, mostly the elderly and most vulnerable citizens, or as the PTBs say “culling of the herd has begun”.

Source: Zero Hedge
“If the recent Hungarian “appropriation” of pension funds, and today’s laughable Irish bailout courtesy of domestic pension funds sourcing 20% of the “new” money was not enough to convince the world just how bankrupt the entire European experiment has become, enter France. Financial News explains how France has “seized” €36 billion worth of pension assets: “Asset managers will have the chance to get billions of euros in mandates in the next few months for the €36bn Fonds de Réserve pour les Retraites (FRR), the French reserve pension fund, after the French parliament last week passed a law to use its assets to pay off the debts of France’s welfare system. The assets have been transferred into the state’s social debt sinking fund Cades. The FRR will continue to control the assets, but as a third-party manager on behalf of Cades.” FN condemns the action as follows: “The move reflects a willingness by governments to use long-term assets to fill short-term deficits, including Ireland’s announcement last week that it would use the country’s €24bn National Pensions  Reserve Fund “to support the exchequer’s funding programme” and Hungary’s bid to claw $15bn of private pension funds back to the state system.” In other words, with the ECB still unwilling to go into full fiat printing overdrive mode, insolvent governments, France most certainly included, are resorting to whatever piggybanks they can find. Hopefully this is not a harbinger of what Tim Geithner plans to do with the trillions in various 401(k) funds on this side of the Atlantic.More from FN on how first France, and soon every other socalized pension regime, will continue to plunder a nation’s life saving to fund short-term deficits.

And elsewhere, in the UK, things in the pension arena are also starting to heat up as the country is preparing to launch an “auto enrolment” feature for workers, whereby up to 11 million will be eligible for automatic enrolment.  Trades Union Congress general secretary Brendan Barber hailed it as an “historic advance”: a minimum pension to go with the UK’s minimum wage. Pensions Minister Steve Webb confirmed last month that all employers would have to enroll staff into a company scheme. As a result, up to 11 million people will be eligible for automatic enrolment in a workplace scheme, with up to eight million of them saving for the first time. However, there is little evidence that employers are ready for it.

And judging by the Hungarian, Irish and French case studies, all monies auto deposited will soon find a new mandate: one of bidding up sovereign European bonds (More from Financial News).  Staff can opt out to avoid mandatory contributions that will eventually account for half of the minimum of 8% of salary, with employers contributing 3% of salary, and 1% coming from tax relief.

It is impossible to predict how many people might opt out, but Colin Tipping, head of institutional wholesale at asset manager BlackRock, points to an 80% take-up at US companies that have introduced auto-enrolment compared with less than half of that before the mechanism was introduced. The latest annual review of New Zealand’s national KiwiSaver scheme has an opt-out rate of 18%.

The European experience is less encouraging. Italy tried to boost private pensions saving in 2007 with reforms to the Trattamento di Fine Rapporto, a fund traditionally paid to workers on leaving an employer.  However, its policy of “silent consent”, which had the money transferred into a pension unless workers objected, saw only about a quarter participate. Tito Boeri, director of the country’s social policy reform group Fondazione Rodolfo Debenedetti, said: “It was a great opportunity to develop private pension schemes here, but to a large extent it failed.”

Our only question: how soon before the US administration takes this hint of what every proper socialist country does with funds apportioned to it by a gullible public and ends up investing trillions in the worst possible asset classes (while in Europe this obviously means sovereign bonds, in the US by and far the proceeds will be used to make further purchases of such equities as Apple, Amazon and Netflix, in whose continued successful ponziness lies the fate of a vast majority of US-based hedge funds, whose LPs may at some point, in the distant future, actually pay domestic income tax.”

And in the US there are respected individuals who are now beginning to sound the alarm, but no one is listening.  The recent upward movement of the dollar is taunted by conventional wisdom as proof against such alarmists.  However consider this article.

By Paul Craig Roberts – BLN Contributing Writer

“On Thanksgiving eve the English language China Daily and People’s Daily Online reported that Russia and China have concluded an agreement to abandon the use of the US dollar in their bilateral trade and to use their own currencies in its place. The Russians and Chinese said that they had taken this step in order to insulate their economies from the risks that have undermined their confidence in the US dollar as world reserve currency.

This is big news, especially for the news dead Thanksgiving holiday period. But I did not see it reported on Bloomberg, CNN, New York Times or anywhere in the US print or TV media. The ostrich’s head remains in the sand.  Previously, China concluded the same agreement with Brazil.

As China has a large and growing supply of dollars from trade surpluses with which to conduct trade, China is signaling that she prefers Russian rubles and Brazilian reals to more US dollars.  The American financial press finds solace in the episodes when sovereign debt scares in the EU send the dollar up against the euro and UK pound. But these currency movements are just measures of financial players shorting troubled EU-denominated debt. They are not a measure of dollar strength.

The dollar’s role as world reserve currency is one of the main instruments of American financial hegemony. We haven’t been told how much damage Wall Street fraud has inflicted on EU financial institutions, but the EU countries no longer need the US dollar for trade between themselves as they share a common currency. Once the OPEC countries cease to hold the dollars that they are paid for oil, dollar hegemony will have faded away.

Another instrument of American financial hegemony is the IMF. Whenever a country cannot make good on its debts and pay back the American banks, in steps the IMF with an austerity package that squeezes the country’s population with higher taxes and cuts in education, medical and income support programs until the bankers get their money back.

This is now happening to Ireland and is likely to spread to Portugal, Spain, and perhaps even to France. After the American-caused financial crisis, the IMF’s role as a tool of US imperialism is less and less acceptable. The point could come when governments can no longer sell out their people for the sake of the American banks.

There are other signs that some countries are tiring of America’s irresponsible use of power. Turkey’s civilian governments have long been under the thumb of the American-influenced Turkish military. However, recently the civilian government moved against two top generals and an admiral suspected of involvement in planning a coup. The civilian government further asserted itself when the prime minister announced on Thanksgiving Day that Turkey is prepared to react to any Israeli offensive against Lebanon. Here is an American NATO ally freeing itself from American suzerainty exercised through the Turkish military. Who knows, Germany could be next.

Meanwhile in America, the sheeple remain content with, or blind to, their role as sheep to be slaughtered to feed the rich. The Obama Administration has managed to come up with a Deficit Commission whose members want to pay for the multi-trillion dollar wars that are enriching the military/security complex and the multi-trillion dollar bailouts of the financial system by reducing annual cost-of-living increases for Social Security, raising the retirement age to 69, ending the mortgage interest deduction, ending the tax deduction for employer-provided health insurance, imposing a 6.5% federal sales tax, while cutting the top tax rate for the rich. Even the Federal Reserve’s low interest rates are aimed at helping the banksters.

The low interest rates deprive retirees and those living on their savings of interest income. The low interest rates have also deprived corporate pensions of funding. To fill the gap, corporations are issuing billions of dollars in corporate bonds in order to fund their pensions. Corporate debt is increasing, but not plant and equipment that would produce earnings to service the debt. As the economy worsens, servicing the additional debt will be a problem.

In addition, America’s elderly are finding that fewer and fewer doctors will accept them as patients as a 23% cut looms in the already low Medicare payments to doctors. The American government only has resources for wars of aggression, police state intrusions, and bailouts of rich banksters. The American citizen has become a mere subject to be bled for the ruling oligarchies.

The police state attitude of the TSA toward airline travelers is a clear indication that Americans are no longer citizens with rights but subjects without rights. Perhaps the day will come when oppressed Americans will take to the streets like the French, the Greeks, the Irish, and the British.”

What is so interesting about the above OpEd is to know who Paul Craig Roberts is and what he is known for in the world.  Dr. Paul Craig Roberts is the father of Reaganomics and the former head of policy at the Department of Treasury. He is a columnist and was previously an editor for the Wall Street Journal. His latest book, “How the Economy Was Lost: The War of the Worlds,” details why America is disintegrating.

The next Wikileaks is supposedly centered on a large New York Bank.  When these documents are released, I am afraid the real backlash will start in earnest.  If Congress fails to extend unemployment benefits in the US and does so while extending the Bush tax cuts, I think we see in America what has already started in Europe.  What is so sad about this scenario is that “mob” reaction is predicted and contingencies are developed to “deal” with “those” kinds of situations.  What people should be realizing is that politicians and banksters can be prosecuted and replaced.  This should be the rebellious effort.  Make the administrative side of government work.  I can dream can’t I?

Is the Global Big Crash Just Weeks Away?

As I wrote in my post of last week, the biggest story in my humble opinion is what is going on with currency manipulations and the so-called “austerity” programs being rolled out in Europe.  Why do I consider these events so seminal?  Firstly, for many months now the “textural” landscape of the internet has contained increasing material related to future mass riots.

Secondly, I have previously reported on serious contingency plans and exercises conducted by the UN and more specifically, the US.  The 3rd Infantry Division’s 1st Brigade Combat Team has spent 35 of the last 60 months in Iraq patrolling in full battle rattle, helping restore essential services and escorting supply convoys. Now they’re training for the same mission — with a twist — at home. Beginning Oct. 1,2009, the 1st BCT is under the day-to-day control of U.S. Army North, the Army service component of Northern Command, as an on-call federal response force for natural or manmade emergencies and disasters , including terrorist attacks.  This new mission marks the first time an active unit has been given a dedicated assignment to NorthCom, a joint command established in 2002 to provide command and control for federal homeland defense efforts and coordinate defense support of civil authorities.

After 1st BCT finishes its dwell-time mission, expectations are that another, as yet unnamed, active-duty brigade will take over and that the mission will be a permanent one. “Right now, the response force requirement will be an enduring mission. How the [Defense Department] chooses to source that and whether or not they continue to assign them to NorthCom, that could change in the future,” said Army Col. Louis Vogler, chief of NorthCom future operations. “Now, the plan is to assign a force every year.”

Here is a scenario.  First, understand the markets are as much psychological as they are technical.  We are witnessing increased pressure on the working class globally and the economy is sputtering at best.  The fear is that frustrations boil over to active rebellion which becomes pandemic globally.  This results in governments over-reacting to the population and martial law is declared and many are interned in makeshift large detention centers.  I think that global events are unfolding right now that validate the scenario is unfolding rapidly, especially in Europe.  Last week the Members of Parliament from Iceland had to be escorted out of the back door of the assembly when confronted by angry citizens.  This type of unrest is erupting everywhere in Europe.  Consider these reports.

PARIS (Reuters) – French families, students and private sector workers joined mass demonstrations on Saturday as trade unions ramped up pressure on the government to drop pension reforms.  Opposition to President Nicolas Sarkozy’s plan to raise the retirement age to 62 from 60 showed no signs of abating and hundreds of thousands across the country marched in the fourth round of rallies in as many months

Unions said that about 2.9 million had marched, while police said the crowds numbered 899,000. The union figure was about the same as at the last demonstrations on September 23. The police figure was slightly lower.  About 230 protests took place across the country with a bigger turnout of families, who are less likely to protest on weekdays, and students as concerns about pension reform highlight a deeper anxiety about their future.

Until now the protests have been also mostly in the public sector but private sector workers including some from plane builder Airbus and national carrier Air France-KLM joined Saturday’s marches.  “We are a lot more today than during the week,” said Xavier Petrachi, a delegate at the CGT union in Toulouse. “It’s got a real family feel, buggies are out. France is protesting.”

The draft bill, a reform deemed unjust by unions but essential by Sarkozy, will be debated in the Senate — the upper house — from Oct 5.  A survey published by French daily newspaper L’Humanite showed more than 70 percent of people backed the day of action.  Trade unions across Europe are seeking to rally opposition as governments slash spending to dig their way out of debts run up during the global financial crisis.

The government says its legislation is essential to erase a growing deficit in the pay-as-you-go pension system, curb rising public debt and preserve France’s AAA credit rating, which enables it to borrow at low financial market rates.  French Labour Minister Eric Woerth late on Saturday told France 3 television the government still had to educate people about the reform, but it would not budge on its core.

The real issues here are that global employment will not recover to pre-crisis levels until 2015 if current policies are pursued, creating social tension, the International Labour Organisation has warned.

Riot police hit out at demonstrators during protests in Barcelona, Spain.

The United Nations work agency said it was putting back by two years from 2013 its previous assessment of the time needed to create the 22 million jobs still needed to regain the pre-crisis level – 14 million in rich countries and 8 million in developing states.  ”Despite these significant gains … new clouds have emerged on the employment horizon and the prospects have worsened significantly in many countries,” it said.  Raymond Torres, lead author of the report, told a news conference that job losses since the crisis started had totalled some 30-35 million. The ILO has forecast global unemployment this year of 213 million, a rate of 6.5 per cent.

For the United States – where persistent unemployment has become one of the main issues in this November’s elections – the number of jobs still needed to regain pre-crisis levels is 6.9 million, Steven Tobin, ILO economist, said.   The extended loss of employment and growing perceptions of unfairness risked increasing social tension, the ILO said.  In 35 countries for which data exists, nearly 40 per cent of jobseekers have been without work for more than one year, running risks of demoralization and mental health problems, and young people were disproportionately hit by unemployment.   It noted that social unrest related to the crisis has been reported in at least 25 countries, including some recovering emerging economies.

In Germany, Chancellor Angela Merkel called for calm Friday after riot police used what critics called “Rambo” tactics to disperse thousands of opponents of a contentious rail project.  ”I would hope that demonstrations like these would pass off peacefully,” Merkel told public broadcaster SWR after the skirmishes in the southwestern city of Stuttgart on Thursday that raged on into the night.   ”This must always be tried, and anything that leads to violence must be avoided.”

Demonstrators said that more than 20,000 protestors, including more than 1,000 schoolchildren, were dispersed by close to 1,000 police in riot gear using water cannons, pepper spray, tear gas and batons.  More than 400 people including minors needed medical treatment, mostly because of the tear gas and pepper spray exposure.

In Ireland, taxpayers are being left with the bill and deeper austerity measures, but the government says the banks are too big to fail.  Overnight taxpayers learned they will be shouldering an even bigger burden to bail out the Anglo Irish Bank – to the tune of $41 billion.  “The banks have actually got us into this mess. They should actually get us out,” one person said.

“It is too shocking when you see people still on the side of the road homeless and yet there were these people smoking their big cigars and yachts out in the Mediterranean,” another said.  With unemployment at a record high of 14 per cent, Macdara Doyle, from the Irish Congress of Trade Unions, says citizens cannot afford the bailout bill.  “We started out at this place two years ago with what we were told was the cheapest bank guarantee or bank rescue scheme in the world,” Mr Doyle said.  “[It] then went to $4 billion. It is now at about $29 billion or $34 billion depending on what scenario you believe. It is not working. It is killing the economy.”

Irish finance minister Brian Lenihan says he understands the country’s frustration, but says this should draw a line under the taxpayer’s liability.  “The Irish people are entitled to be angry with the bankers who lent recklessly over a considerable period of time in the earlier part of this decade,” Mr Lenihan said.  Irish government borrowing was heading to 12 per cent of its annual economic output.
This will now treble; a third of the Irish economy will now go towards supporting its banks.

When you combine all of this intel with the gross lack of political will inherent in the congresses and parliaments of these countries, coupled with the “pressure” the financial communities are applying to the governments currently, November could be the month we will historically mark as the beginning of the great world collapse.

In the US we can sense the tensions building as more and more families are facing desperate situations.  The Tea Party is somewhat a barometer of that anger.  People are really pee’vd and they really don’t know what to do about it.  The fact is we really are all the same, whether you are Bill Gates, billionaire, or John Smith, McDonalds night manager.  We EACH GET ONE VOTE.  Get it? Be sure to do something about it. Get informed and vote. It has NEVER been more important globally than now.

Watching the Slow Motion Implosion

When you take all of the events occurring right now, both on the financial front and the social front globally, one can easily get the sense you are watching a slow motion implosion of societal structures. The question becomes how to react to the events. On the one hand, do you get involved, act, react, prepare, declare, etc. or do you just observe and stay detached. I think anyone who is awake is asking these types of questions at the moment.

From a financial perspective, the situation in Europe I fear is going to spread like wildfire in the next few months.  There are many reasons for this, but mostly it is that those who “know” the truth have not been truthful with the general public.  Their reasoning for this is that they don’t want to precipitate a general panic, but the truth is they are trying to save their butts from an angry mob.

The events, however, are overwhelming them and the next few weeks these events are going to spiral out of control.  What events you ask? consider these most recent revelations.

Greece will need financial assistance amounting to between €100-120bn over the next three years, German parliamentarians claimed on Wednesday after meeting Dominique Strauss-Kahn, managing director of the International Monetary Fund, and Jean-Claude Trichet, president of the European Central Bank. They said that the €45bn currently proposed as a rescue package of loans from the IMF and other members of the eurozone was only enough for the first year of support. Yields on two-year Greek bonds rose to above 16 per cent on Wednesday amid growing nervousness about the state of the country’s deteriorating public finances.

When you consider these kinds of numbers, the reality dictates these are not doable in any fashion.  Greece could not devise draconian enough austerity plans to address this kind of debt and the supporting eurozone could not possibly support such an effort. I say this because Greece is not an isolated case given the situations which are similar in Spain, Portugal, Italy and for that matter the UK as well. “It’s not a question of the danger of contagion; contagion has already happened,” Angel Gurría told Bloomberg. “This is like Ebola. When you realise you have it you have to cut your leg off in order to survive.”

Credit rating agencies have been criticized for their role in the financial crisis, but their views are still closely watched by investors anxious about the deteriorating public finances of some of the world’s most heavily indebted countries. S&P’s announcement hit Spain’s stocks and bonds. Spanish 10-year bond yields, which have an inverse relationship with prices, rose to 4.127 per cent, while the stock market tumbled 3 per cent. Greek bond prices fell further in the wake of Tuesday’s downgrade of Greece’s credit rating to junk status by S&P. Ten-year bond yields jumped to 9.91 per cent. The euro was down 0.1 per cent at $1.3135, its lowest since April 2009.

In the UK, the political candidates are debating and without exception they are lying to the public as to the extent and nature of UK national debt.  At best they are representing the issue at 25% of reality.  They cannot bring themselves to even utter the truth about what austerity measures will be required for fear of evoking Greek like riots in Britain.  The truth is they know that in this case the truth would not set them free but exactly the opposite, it would land them in jail or worse on the pointy end of a pitchfork.

Social unrest combined with these financial realities is beginning to spread world-wide as well.  These issues tend to simmer for a period and then rapidly come to a boil.  We are seeing just this in Thailand, the Ukraine, Greece and now I fear the US.  Politicians and talking heads tend to fuel the fires for their own selfish purposes which does not help the situation.

The immigration issues in the US are a prime example of how irresponsible political leaders are acting for what they perceive as political positioning.  Arizona’s politicians managed to guide frustrations into an absurd legislative action that can only bring riots and bloodshed.  At the core of the issue when examined with the cool head is how NAFTA and the impacts of NAFTA were not planned for and dealt with as they unfolded.  NAFTA created a situation in Arizona where agricultural products from Arizona were allowed to be imported into Mexico cheaper than Mexicans could produce the products and import them into the US.  These activities have increased by over 30% in the last three years. http://www.nass.usda.gov/Statistics_by_State/Arizona/Publications/Crops/cur-crop.pdf. Over 2,000,000 small farmers in Mexico were displaced by these facts.  However, Arizona imported those farmers to work the fields in Arizona to deal with the rapid increase in cheap labor demand.  Now the social issues are coming home to roost. We see this spilling over into other states like Texas, California, and New Mexico.

Instead of politicians dealing with these facts and the cause and effect elements of the problem, they choose instead to fuel the emotional aspects of the issues for political gain.  They are however, creating a maelstrom of events like is very likely to spiral out of control.  What we need right now is calm honest debate of the cause and effects of the situation on the border.  We need an honest assessment of all of the factors that have created the tension and most of all we need to deal with issues as partners, not enemies.  There is enough stress and frustation on both sides of the border. The apartheid approach simply will not work.

Globally putting all these things together as a giant tapestry, we certainly look like we are heading into the Summer of Hell.  Maybe we ought not take ourselves so seriously.  Maybe we ought to look at the messes we are in and chuckle at how ignorant we can be, and then sit down and figure our way out of this mess.  That is the one thing I think is gravely missing here.  It is our sense of humor and a good belly laugh.  I can hope.

Here’s Uncle Willy’s Thought for the Day: