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.