There’s a very subtle shift going on in America right now: We’re slowly seeing the underpinnings of society under attack on the one hand (monetization of racism, Marxist-Digital Insurrection). But on the other, we’re seeing the hollowing-out of the modest residual purchasing power remaining in the “American Dollar.”
In fact, if you Wiki “Federal Reserve Note” here’s the key thing to understand:
“ Federal Reserve Notes are authorized by Section 16 of the Federal Reserve Act of 1913. These are issued to the Federal Reserve Banks at the discretion of the Board of Governors of the Federal Reserve System. The notes are then put into circulation by the Federal Reserve Banks. They then become liabilities of the Federal Reserve Banks and obligations of the United States.“
Read that last part again: They are liabilities of the Federal Reserve Banks. Which means, there is an “out” for the tatters of the FedGov: Simply reconstitute the Fed if times get bad enough. Turning it into “something else.”
Where’d the “Value in Money” Go?
The Federal Reserve doesn’t talk in great detail about this “hollowing out” process. With the exception of former Congressman Ron Paul, not many on the Hill either. “It’s a Club,” as George Carlin put it. “And you’re not in it.”
A quick trip to the Minneapolis Fed website (which rather honestly is a .org not .gov site!) reveals that in 1913, if you had $100-bucks, you’d need how much today just to remain “even?” $2,588.06!
Divide 100 by this latter number and we find the “residual real value of our money” is just 3.8639%.
Then It Gets Worse
Any damn fool can click over to the Fed’s H.6 money stocks report and behold the increase in M2 in the past 52-weeks. It has been 32.4% on a cash basis (M1) and 21.6% on a “cash and some savings” basis (M2). If prices are stable (semi) this is how you “paper-over” an economic Depression.
To confirm – since the Fed has lied its way out of reporting actual M3 – there is still John Williams’ excellent ShadowStats.com website we see on the chart (on this page) that the reconstructed M3 annualized is running about 26-27%.
Let’s take that 2019 basis number ($2,588.06) and multiple that times 1.26 (to toss in current inflation since the March 2019 Fed admission). We see that what had cost $100-bucks when the Fed filched U.S. money controls for central Banksters, today is denominated at $3,260.95.
Last step – if your hair isn’t on fire yet?
3.066%. That means: The dollar right now buys about 3% of what it did in 1913.
Whee! Ready for more fun with math?
We can double-check by remembering that a “good steak dinner” was $1-dollar in 1913. You can go out and have a steak (if you can find a socially-distanced, still in business and open eatery) and for a good steak dinner $33-bucks is hardly a royal sum.
Reserve Currency = License to Steal
Governments all over the world are pondering the same problems we have. When does “Making Up Money” blow up? Ure doesn’t buy Stephanie Kelton’s argument that “making up money” really works. She’s been a Bernie-nomics thinker.
Money is not just a medium of exchange. It’s also (in theory!) a storehouse of value.
If you can just “make up money value” you’re not making up “money.” Its just scrip and people are having one put-over-on-them by the Banksters.
Banksters Wants Gold
What holds value? Gold, platinum, silver, rare earth metals, precious gemstones. Which has pretty hard to counterfeit. Unlike paper. History is still about gold grabbing! (We’ve been “fed” such slop on this point, I cringe.)
We know that when Libya wanted gold (and there has been periodic talk of an Islamic Dinar), what happened to Quadaffi?
We also remember what happened to Venezuela: There, something of a sham election took place. And the West decided to recognize the (banker-backed) loser. This has been followed by the collapse of Venezuela and a fight over which government in Venezuela was “real.”
Steal Gold -> Fuel “Socialist Failure”
“Before 2012, the Central Bank of Venezuela, Banco Central de Venezuela (BCV), held about 211 tons of its 365 tons of gold reserves in American, European, and Canadian banks. In January 2012, however, Venezuela completed the move of 160 tons of gold bars (valued at about $9 billion) back home..”
People don’t follow “real money” (gold, silver, precious metals and FTL capable precious gemstones), but the New York Times reported this month that:
“Nicolás Maduro Can’t Sell Venezuelan Gold at Bank of England, Court Rules”
It would be unlawful to allow Mr. Maduro access to the gold, a British High Court judge said, because Britain’s government recognizes his rival, Juan Guaidó, as Venezuela’s rightful leader.”
The Organization of American States didn’t like the election, though. Despite Maduro winning re-election in 2018. Banksters have their hooks deeply-set in politics, you see…
A delightful perversion of process – the Brits deciding who really won the elections in Venezuela after the fact. Empowering itself to declare a “winner take all.”
Sad fact: Guaidó and/or Venezuela will never take good delivery on their gold. Banksters keep it to themselves. Instead, they will get the (momentary) paper equivalent which will immediately erode quickly toward zero. It’s what paper does.
In the meantime, lacking gold, Maduro (and Venezuela) are trying to reconstitute some national wealth. But, that is made difficult by collapsed energy prices. How convenient, huh?
Banks as Criminal Enterprises
Regrettably, there’s too much discussion by Marxists and their allied groups (like BLM) on the superficial day-to-day of oppression. Too much marketing of genderism and too much emphasis on “high tech Saves!” This is one area where we need some absolute equality applied!
No one asks (except us – in rare lucid moments) abound the underpinnings of our socialization. In this case, it’s the gubermint’s ability to declare what has value.
Hint: It’s NOT paper. Paper is only a promise. And paper promises get broken all the time. As in, for example, marriages. Contracts don’t mean diddly.
It’s OK with banks, though. They love to enforce contract law when it suits them.
Already, we’re seeing in the grown-up press warnings of what’s to come. Last week, in the Harvard Business Review, for example: “How Banks Can Avoid a Repeat of the 2008 Foreclosure Crisis.”
The Bigger Game is YOU
This larger context picture escapes most people, but here’s the Cliff Notes version:
When you were young, your grandparents likely didn’t have a mortgage. They owned their home, their car… everything.
Then along came your parents: Sort of owned a home – typically about 70% equity position. And on cars, one was paid for with a car loan on the other.
Today? No one has equity (that’s been systemically seized by the Banking Class via their Marketing Minions. Side order of “narrative” with that?
With little home equity and autos on leases, people are largely being forced into the “Rent Your Life” business model.
The Missed Alternative
If someone can Tell You what to Do, you are not free. And the only way to be free in today’s world, is to work out a way to exit the Control System. Obvious, huh?
We suffered for years because Ure advocated (and still does) the concept of voluntary lifestyle reduction in order to buy your freedom.
By George (*Henry)
We have lived in a double-wide trailer in the woods on agricultural land. We have regular harvests, too. We try to grow things of value. Go read up on Henry George and this theories of all value springing from the land. Still very much worth a read today:
“His most famous work, Progress and Poverty (1879), sold millions of copies worldwide, probably more than any other American book before that time. The treatise investigates the paradox of increasing inequality and poverty amid economic and technological progress, the cyclic nature of industrialized economies, and the use of rent capture such as land value tax and other anti-monopoly reforms as a remedy for these and other social problems. “
We won’t brag about an absurdly low monthly operating cost for our household.
Instead, we’ll simply reiterate once-again that anyone can do it. Once they unplug from marketing driven consumption and decided that things like power tools and the means to grow some kind of crop, are better stores of value than a cabal of Banksters with friehgt trains of printing ink.
Own Things, Not Paper!
The number we’re hammering on now is reducing our “bank denominated wealth” (about 18.2% as of this morning). Moving into more of the “hard wealth” that encompasses everything from an old gun to a piece of farm equipment to a welder to scrap steel to stored seeds…
The Truth of the Game is in plain sight. It’s become very clear in Venezuela. Free classes if you can read between lines.
And elsewhere, too. Anywhere the “status and consumption monster” lurks, there’s a Bankster in the background. Representing the leech-class of non-producers – who hold up themselves as worthly of skimming the good efforts of the honest working class. Have ink, will rule.
Where Antifa (and other such groups) run off the rails, though, is in failing to table a workable plan for millions to voluntarily downscale in advance. When it becomes non-voluntary? That’s what we call an Economic Depression.
Patience, please. One will be along shortly.
Watch Res Judicata
Oh, one other thing – being maneuvered to become a massive foreclosure wave just before the election?
Pennsylvania Extends Foreclosure, Eviction Moratorium To Aug. 31. This is all setting up a “misery squeeze” on Trump going into the election. Crash market, evict people, and here comes the Slow Joe. You can see the wheels being greased for it if you read widely-enough:
I won’t try to summarize what happened, except to say if you beat foreclosure on a “technicality” the default doesn’t change. At least in Pennsylvania.
What does Res Judicata mean? Well, it’s something like double jeopardy…
“In the case of res judicata, the matter cannot be raised again, either in the same court or in a different court. A court will use res judicata to deny reconsideration of a matter.
The doctrine of res judicata is a method of preventing injustice to the parties of a case supposedly finished but perhaps also or mostly a way of avoiding unnecessary waste of resources in the court system. Res judicata does not merely prevent future judgments from contradicting earlier ones, but also prevents litigants from multiplying judgments, and confusion.”
Except in Pennsylvania now. There it’s clear now that a deficient first foreclosure filing does not prevent a lender from filing a second (and presumably other) filings.
This, boys and girls, is how we can see the “skids being greased” for massive foreclosures to come. People unable to pay are about to experience that “Running the clock” is coming off the table.
Recent Gains All Due to M1?
If you don’t read our high-priced subscriber content (Peoplenomics is $40/year), here’s a useful gem to remember:
In the 13-weeks from April 10 to July 10 closing, our Aggregate Index was up 15.1% for U.S. stocks. In the latest H.6 Money Stocks report, the Money Supply (M1) was up 15.7%.
If you think there’s real growth in this economy, you need to get your head examined. Failing that, see your eye doc and get refracted, right? The ONLY growth in America has been in paper. Think not ink!!!
The Weak Ahead
Consumer Price Index tomorrow. We expect firming.
Retail sales Thursday. We expect squirming.
Industrial Production and Utilization (plus trade data) Wednesday.
In The Shorts?
You mean what really matters here at U.S. Ben Dover Festival Finals?
Dow Futures up 200 on more “vaccine hype”. We must be the only people who read and understand the reports that “Immunity to Covid-19 could be lost in months, UK study suggests — Exclusive: King’s College London team found steep drops in patients’ antibody levels three months after infection.” Investors are herd animals, not heard thinkers.
Second Source: IMF Predicts Worst Mideast Downturn In Half Century. Again, they have herd, not heard.
13-million CV-19 Mark Today. As Trump and advisers attempt to discredit Fauci amid top doctor’s blunt warnings about coronavirus.
OK, primed, primped, and ready for another self-defined Monday? Off and running, then!
Write when you wake up,