Money is Debt, is American Economic Collapse Imminent? 8% Inflation, 15% Unemployment, 47M Poor, Deficit >100% of GDP
If you want to understand how the modern world may end as we know it, the odds-on favorite to study is economic collapse. The only people who could argue some sort of collapse hasn’t already happened are either hopelessly optimistic or well compensated by the multinational corporate interests consolidating the wealth. To bolster that sweeping generalization before I start a Keynesian flame war, some statistics:
47 million U.S. citizens live in developing-world conditions today. We’ve seen 8% inflation on everyday goods over the past year. And while political leaders would lead you to believe unemployment is around 8% too — it’s really closer to a whopping 15% with fully 1 in 5 americans reporting they are underemployed, not making enough money to make ends meet.
The truth is, it isn’t difficult to understand why we’re in this collapse. It’s almost intuitive — the obscenely wealthy consolidators of power and wealth have really knocked it out of the park this time. Media and politicians obscure the fact that paper money has ever-decreasing value for the same self-serving goals as the multinational corporations who profit from selling the Doritos that just went up in price. Mass-produced snack foods are essentially bite-sized subprime mortgages on one’s health and wallet. But I digress…
I believe most of us have a general sense that our country is in deep debt. I think if you asked most people they’d metaphorically think of it as a few maxed out credit cards. Which is a very apt metaphor if you have a credit card with a $15 trillion credit limit and make, oh, let’s say $15 trillion per year. Try getting a 1:1 loan on your salary at the local credit union! Yes, U.S. debt officialy overtook our GDP last year.
To understand how our economic wealth is essentially imaginary, you could do no worse than to watch the famous (on the Interwebs) feature-length animated documentary Money as Debt.
As you sit back and watch this mind-enriching video (admittedly no Pixar blockbuster) it won’t take long before you begin to understand that the modern concept of currency value is essentially imaginary and based on an infinite abyss of debt.
The optimist in all of us wants to believe the economic recovery is real — that our elected officials and corporate-appointed economic overlords have our best interest in mind. A recovery is certainly not out of the question. After all, the next value-injecting tech bubble could be just around the corner with a breakthrough in hardware, software, nanotechnology, genetics or quantum physics. But it’ll still be another bubble.
It doesn’t take a quantum physicist to see that this gargantuan credit bubble will burst one day. If we don’t proactively adjust our system of currency and valuation to a more realistic scope, the force of the market will do it for us, and may crush more than our economy in the process.
You won’t find News for End Times making any political endorsements in this Presidential race (we’re anti-authoritarian like that) but you might be surprised that one of the candidates — Congressman Ron Paul (R-Texas) — held forth earlier today about this very fiat currency crisis to none other than Ben Bernanke, Chairman of the Fed.
We’ve been poring over the impressive Global Risks, 2012 report by the World Economic Forum. This juicy document aggregates the opinions of experts across the globe to determine just how the world as we know it is likely to end this year.
The fascinating report is really worth a look, and if you’re in a hurry, just check out this crazy infographic:
As you can see, it’s really quite simple: Unsustainable population growth increases complexity, risking critical systems failure as chronic fiscal imbalances test our very survival. Global governance failure means there is no apparatus to contain the problem as rising greenhouse gas emissions throw the environment into chaos. The rapidly disintegrating fabric of society might catch fire before it unravels.
OK, so that’s the doomsday scenario — clearly it would only take only one of the above disasters to seriously tilt civilization toward the edge. That’s why it’s helpful to cross-reference the above with this really cool interactive infographic which displays the likelihood of SHTF in economic, environmental, geopolitical, societal and technological contexts. Each risk is also ranked by impact on how band it’s gonna screw up your day… and the days of 7 billion other folks.
So what do the experts say we should be watching out for the most? On a scale of 0-5, with 5 being ‘unavoidable’, “severe income disparity’ and ‘chronic fiscal imbalance’ rank just above a 4. Major systemic financial failure may only rank around 3 in likelihood, but it’s the hardest-hitting disaster at around a 4 impact. Other notable threats include environmental hazards and shortages of food and water, which the survey finds more inevitable than not.
While the report urges action to mitigate these threats, it paints the picture of a dystopia bound for mass casualties, noting that our preparedness has not evolved alongside the threats. World leaders are reading this report to learn how they can exploit these weaknesses. Business leaders are reading this report to see how they can profit. We highly recommend you at least skim the report, as a stakeholder in the survival of the fittest.
The always-sharp Middle East analysis at DEBKAfile shows that a war of attrition is brewing and in fact some signs point to a war already beginning to break out. The analysts as well as Saudi Arabia’s leadership predict Iran will progressively constrict the Strait of Hormuz rather than shut it down in one swoop. This waterway is where one-fifth of the world’s oil comes from, and Saudi Arabia is closely watching the situation, mulling what kind of action from Iran would constitute an act of war.
Meanwhile, the U.S. military is constructing a floating commando base in the Middle East which will serve as a launchpad of attack should the Strait of Hormuz situation go south. They’re also working on a bunker buster that can destroy Iran’s deeply buried nuclear facilities after admitting their current $300M+ arsenal isn’t good enough to do the job. This all comes after the Pentagon’s recent revealing of its austerity program, which exposes America’s strategic military objective to use these commandos in response to asynchronous threats in the region. In fact, one could argue that the black ops attacks on Iran’s nuclear facilities and scientists could be construed as the start of this conflict, in which case war is already underway.
The emerging picture is not one of a land war similar to the last several Gulf wars, but rather one of precision drone strikes, daring commando raids and high-tech defense gadgetry. This new face of war is no more attractive than the old. Because of Western sanctions currently imposed on Iran, the average Iranian citizen is suffering from rapid inflation and isolation. We may see a similar situation in Iran as the sanctions against Iraq which claimed the lives of millions of innocent Iraqi citizens. It goes to show that any war, be it high-tech, in the trenches, or even fought through “diplomacy” — is hell.
An enormous solar outburst is traversing space at enormous speeds and headed straight toward our planet at this very moment. Tonight, the Earth will be bombarded with a blast of energy from the sun. Stargazers will witness some of the most spectacular Northern Lights displays of their lifetime, due to the geomagnetic disruption of the Earth’s atmosphere. At the same time, U.S. scientists and military will be closely studying the energy and communications grids for any sign of malfunction. NASA, an agency that is usually the first to debunk end-of-the-world conspiracies, has admitted in the past that if solar flares were violent enough to trigger an all-out geomagnetic maelstrom, energy and communications would be disrupted worldwide, causing a conservative $125B in damages. With a downed energy and communications grid, the world could quickly descend into TEOTWAWKI panic and do untold damage to not just the economy, but our entire civilization.
In general, humanity is very unprepared to deal with these solar phenomena. The occurrence of these coronal mass ejections is as tough to predict as their effects. I’m no scientist, so let’s let Wikipedia tell us what actually goes down in such an event:
While the experts are saying that this geomagnetic disturbance will cause only minor disruption at worst — the truth is the experts are still figuring it all out and anything is possible. We’ve come a very long way in the last 20 years toward understanding how the sun’s violent outbursts interact with our planet, but there is still much left to discover. With a giant radioactive solar wind about to enter our atmosphere, I think I’m going to stay inside tonight and double-check the emergency supplies.
As the world population races past the bloated 7 billion mark, we are witnessing new records in the expense of damage caused by natural disasters. The United Nations is reporting that $366 billion was lost worldwide last year due to natural disasters like earthquakes, hurricanes, floods and tsunamis. This also sent the insurance industry reeling, with insured losses estimated at roughly $105 billion, the result of catastrophic earthquakes and storms in highly populated areas. This is all happening while many countries prone to earthquakes are significantly underinsured, putting economies at greater risk.
Was 2011 just a bad year, or are we headed for another wallop in the wallet from Mother Nature? With the population ever-expanding and the middle class disappearing, more of the world will be covered with dense, impoverished populations. Even if there are fewer surprises than last year, all it takes is a single, high-magnitude natural disaster and 2012 could rocket into the record books before summer. A recent global report by Global Industry Analysts, Inc. makes the following claim as it highlights the benefits of diversifying one’s portfolio with emergency services assets:
So… to recap, buy quake insurance, or better yet, move into the country. If your house is still worth anything, don’t get cocky, there’s always a new season of extraordinarily expensive natural disasters to contend with.
Is this the beginning of the end for ‘fracking‘? The evidence continues to mount proving the practice creates clear causal links to lethal water pollution and now fracking is being blamed for causing earthquakes. If you needed any confirmation that there was an energy crisis underway, the American corporate oligarchy is so fearful of falling into the grips of an oil crisis that they now seem to consider causing earthquakes as collateral damage to extracting domestic oil.
Won-Young Kim, a research professor of Seismology Geology and Tectonophysics at the Lamont-Doherty Earth Observatory at Columbia University, is the latest expert to directly link hydrofracking to a swarm of earthquakes in Ohio. Slow down and think about this: man-made earthquakes are now a reality. We always thought we’d hear that some tin-foil hat claim that the U.S. had weaponized earthquakes turned out to be true and HAARP really was for nefarious purposes. But no, the reality is much more mundane — in order to maximize profit and domestic oil production, U.S. industry is now actively pursuing a methodology that creates earthquakes as a side effect.
Kim cautions this is not a short-term problem, and in fact the recent earthquakes are just the beginning:
None of this should actually come as a surprise to the hydraulic fracking industry itself, which has been seeking to quash public outcry since becoming aggressive with the practice in the wake of the ‘foreign oil is a National Security risk’ meme. It doesn’t take a scientist to realize that the idea of drilling over two miles into the Earth’s crust (10+ Empire State Buildings) to pump massive amounts of water, sand and chemicals with the express purpose of fracturing the Earth might be dangerous. Anyone who’s seen the movie Armageddon knows that.
There’s apparently one poor guy manning the Ohio seismology station and we assume the energy companies would like to keep it that way. But the Web is starting to wake up more and more to the dangers of fracking. We hope you add your voice to the growing opposition against this suicidal technology. Not that we have anything against the end of the world — but we’d prefer not to be responsible for it.
The war drums can be heard loud and strong in Iran, and its citizens are already mentally preparing for an inevitable attack. They have every reason to be concerned, given that their country’s crossing of a new nuclear weapons development milestone has not gone unnoticed by Western military powers.
The most recent war buzz centers around the recent deployment of thousands of U.S. troops to Israel. Army officials have already admitted the move is more “deployment” than “exercise” and analysts say as many as 9,000 American troops are now in Israel helping that country prepare to bring Iran’s nuclear weapons program to a violent end.
This escalation in tension comes after repeated successful attempts by Western black ops to stymie Iran’s nuclear progress, first with the Stuxnet worm, something of a warning shot. This unprecedented secret cyber attack was followed by a pair of powerful explosions which destroyed important weapons manufacturing infrastructure. While Iran claims these as accidents, many analysts are convinced that a CIA/Mossad connection is a much more rational explanation.
Analyst Davis Swanson warns that not only is an Israel-Iran or Israel-US-Iran conflict imminent, but it threatens to quickly develop into a global conflict, saying recently:
All this news makes a war seems likely, to some even certain. It remains to be seen how such a conflict would begin, though many assume an Israel-led strike on Iranian nuclear targets. But as of now there is no way of knowing for sure if, 5 years from now, we’ll be writing about U.S. oil companies making bank in Iran, like we are today about Iraq. After all, we already have a contingency plan in place should oil supplies be disrupted by a conflict in the near future.