De-Dollarization and the Collapse of the US Economy

For several months we have been writing about how the world’s financial landscape is changing and the complete failure of the FED’s monetary policies and how their policies are creating an utter disaster for the US economy. Since 2008, when the FED decided for us (the US taxpayer) that we would bailout and continue to fund the totally insane bankers and their never ending casino games, our economy is flat, poverty is increasing, our infrastructure is collapsing, our trade deficits are exploding, and we are beginning to look like a third world country.

All the while, the rest of the world (excluding the US. Canada, the EU, and Japan), are starting to wake up and say “No More Insanity”. Quietly, but surly, the BRICS and in particular China began to build consensus that a new approach was needed to address the world’s economic situation. When China formed the AIIB, the FED, the World Bank, and the IMF snickered arrogantly at their efforts. After all, the US, Japan, and the EU were giants in the financial world.

Now, just a few years later, there is quiet panic within this same group and for very good reason. Not only has the BRICS and particularly China been successful in their efforts, they are about to crush the EU and US economies. The dollar is essential DOA as the international trading currency. It is truly criminally negligent how the FED and the ECB have handled this situation. Further, instead of waking up to the new economic reality, the western banking cartel continues to play their insane game.

These bankers have created a $278 TRILLION dollar derivatives time bomb SINCE 2008 that could go off at any moment.  The ECB has doubled down on Greece and this will absolutely insure a Greek default which will, without question, create a total collapse of the Euro. Instead of curbing the gambling excesses of these bankers, breaking up the too big to fail banks, stopping the blatant market manipulations, the FED and the ECB continue to ignore their fiduciary duties to regulate and police the very bankers that have created this disaster.

They say a picture is worth a thousand words, so here is the big picture.

aiibmap

 AIIBCapitalStructure

 

What is most important to note is that in just under a year, the AIIB has created a membership of participating countries that is quickly isolating the ECB, Japan, and the US. Secondly, you can see the AIIB already has more paid in capital than the World Bank, the IMF, and the ADB combined.

What is also interesting to note is how far behind the US has fallen in infrastructure. Infrastructure is the backbone of economic growth and the US is beginning to look like a third world country. Our CONgress continues to ignore these needs and by all measures could be seen as criminally negligent in addressing these issues.

It is really time that the American people begin to wake up and understand that these issues are at the very core of our standard of living issues and if we don’t make these issues the focus of the next election, we are in for one helluva dismal future. This isn’t a theory or opinion. It is FACT.

What can we do? Here are just a few suggestions that need to be addressed immediately.

1). Can the FED and return the responsibility of determining fiscal policy back to the Treasury Department.

2). Break up the big six “too big to fail” banks and instead of fining them, start the criminal charges and send some of these idiots to jail. Congress and our Department of Justice should be doing their jobs honestly and not as dupes to these cronys.

3). Starting working with the BRICS and the AIIB, instead of being like recalcitrant children. This means working on sound global fiscal policies, developing real backing to international trading currencies, and addressing the world’s infrastructure needs, instead of trying to fast track TPP, which is just another failed effort to exert a strength we no long have in the world. Our trade agreements, based on this unrealistic premise, has been a disaster for the US economy and US workers, has killed our manufacturing capabilities, and skyrocketed our trade deficits. These are facts, not opinions or theories.

4). Make rebuilding the US infrastructure a priority in the federal budget. It is the fastest way to create jobs and economic demand. Our critical immediate needs would generate nearly $5 trillion in spending. That is money that would go directly into the economy and not in some bankers accounts.

Get informed as a voter, speak up, demand these actions from our representatives. We are literally only months away from a total economic meltdown from which there is no immediate recovery. It would take decades to recover. Action is needed right now.

Why Poverty is a Weapon of Mass Destruction

In the United States, the official poverty rate for 2012 stood at 15 percent based on the national poverty line which is equivalent to around $16 per person per day. Of the 46.5 million Americans living in poverty, 20.4 million live under half the poverty line. This begs the question of just how poor America’s poorest people are.

Using an alternative dataset from the one employed for the official U.S. poverty measure, Shaefer and Edin show that millions of Americans live on less than $2 a day—a threshold commonly used to measure poverty in the developing world. Depending on the exact definitions used, they find that up to 5 percent of American households with children are shown to fall under this parsimonious poverty line.

These numbers are intended to shock—and they succeed. The United States is known for having higher inequality and a less generous social safety net than many affluent countries in Europe, but the acute deprivations that flow from this are less understood. A crude comparison of Shaefer and Edin’s estimates with the World Bank’s official $2 a day poverty estimates for developing economies would place the United States level with or behind a large set of countries, including Russia (0.1 percent), the West Bank and Gaza (0.3 percent), Jordan (1.6 percent), Albania (1.7 percent), urban Argentina (1.9 percent), urban China (3.5 percent), and Thailand (4.1 percent). Many of these countries are recipients of American foreign aid. However, methodologies for measuring poverty differ wildly both within and across countries, so such comparisons and their interpretation demand extreme care.

When we take a closer look at poverty in America, we must understand that poverty is greatest among the most vulnerable of the population. Looking at Mississippi, which is ranked 51st, meaning even Puerto Rico ranks above it, the overall poverty rate is a staggering 24.2%! That is 1 in four who live in poverty! However, it gets worse when you drill down further into the numbers. The child poverty rate is 34.7%, which is one of every three children in Mississippi living in poverty. This clearly demonstrates the third world nature of the scope of the poverty in the US. The poverty rate for people with disabilities is also deplorable at 30.4%.

poverty in america

You can explore where your state stands in detail at http://www.povertyusa.org/the-state-of-poverty/poverty-map-state/#. What you discover may surprise you and what is apparent is that children and people with disabilities are most adversely affected by poverty.

What is more surprising is where the US ranks in the world related to child poverty. A new report by the United Nations Children’s Fund, on the well-being of children in 35 developed nations, turned up some alarming statistics about child poverty. More than one in five American children fall below a relative poverty line, which UNICEF defines as living in a household that earns less than half of the national median. The United States ranks 34th of the 35 countries surveyed, above only Romania and below virtually all of Europe plus Canada, Australia, New Zealand and Japan.

 

The map below gives a comparative sense of the data. The blue countries have less than 10 percent of its children below UNICEF’s relative poverty line, with the red countries approaching 25 percent. Southern European countries, among the most effected by the euro crisis, have some of the worst rates, although none as low as the United States. Former Soviet countries also score poorly. Northern European countries score the highest. English-speaking countries tend to fall somewhere in the middle.

The poor U.S. showing in this data reflects growing income inequality. According to one metric of inequality, a statistical measurement called the gini coefficient, the U.S. economy is one of the most unequal in the developed world. This would explain why the United States, on child poverty, is ranked between Bulgaria and Romania, though Americans are on average six times richer than Bulgarians and Romanians.

Here, from the UNICEF report, is the chart of relative child poverty rates (the grey countries are marked separately because they could not provide data for all other indices and are thus not included in the final rankings):

child-poverty-rates

 

And finally, when you compare the poverty rate among children in the US and compare it to what we think are the poorest nations in Africa, we would rank worse than some countries that would surprise you.africa poverty

 Does this appall you? Does this make you understand the real danger to the America ideal and standing in the world? We should be outraged that we have allowed our leaders to drain our treasures, take the fruits of our labor and fritter them away on wars, and war machines. Without meaning to be too harsh, we are directly responsible for this deplorable state of affairs by our apathetic attitude toward politics. We must understand the raping of America is on-going and if we don’t soon stand up to these political hacks and corporate cronies soon, there will be no one capable of standing because of poverty, hunger, and ignorance. Those ads on TV showing the starving children of the world that pull on your heart strings may have your grand kids photos featured. This is the canary in the mine for the real collapse of America and it already died! Let’s get pissed!