September 2012 Archives

Financial Failure (continued)

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Fed Buying Maximum Legal Limit of Treasury Debt

The Fed is creating virtual money to buy 70% of new debt issued by the federal government.

This is what financial failure looks like boys and girls - except that your average family don't have access to the federal reserve handing them newly printed money so they can keep buying stuff even though they're broke, destitute, and so deeply in debt there's no way they can keep up with the payments.

This will have major consequences for the dollar, as the available pool of dollars represents a fixed amount of value (in the minds of the financiers, as well as those economists who are still sane and rational)

When the number of dollars keeps rising but the value of what it represents does not, what do you think happens to what you'll be able to get for the dollars you've had all along?

If you said "their value will decrease proportional to the proportion of new additions into the system" you have the first level of understanding. Actually, it's worse than that, as this sets of a cycle of "print more, devalue more" with the only people left out being those people with fixed numbers of dollars who don't have access to the printing press for more.

Yes, this amounts to a tax on those with fixed incomes and fixed assets, which does not, generally speaking, mean the wealthy. A *huge* tax, on those whom the Administration claims to want to help.

This is endgame. The government is going to face a crisis when the markets start wondering if it ever intends to pay those who hold its debts. Quite possibly, the fact that the election is so close may be all that is holding this crisis at bay. While I am not confident Mitt Romney or Gary Johnson can get us past this crisis with the United States as we know it more or less intact, I am quite certain Barack Obama not only will not try, he won't understand that there is a problem, even when the military starts selling its hardware so it can buy food for service folk and their dependents

I have decided not to renew my subscription to World of Warcraft

They had, for a long time, a check mark in the interface that prevented you from inadvertently becoming vulnerable to pvp (player versus player) attacks. Since that's not my idea of a good time, I left that protection consistently checked.

However, in the run-up to the new expansion, they removed that, with the result that gangs acting an awful lot like classic teenage bullies have discovered they can now get in your face, and your toon will eventually (as in "within a few seconds") do something that enables them to gang up on you, repeatedly killing your character.

The game gear that's best against other players is also NOT the game gear that's best against virtual monsters, so this further encourages these killjoys, as the odds are with them even if they happen to be alone - odds are the other guy has the monster gear on and they will be able to kill them easily. They proceed to do so repeatedly. This entire cycle happened to me twice today. So it took these groups of wannabe thugs less than two weeks to figure out that protection that was previously provided is now absent. If my experience with the online gaming community is any guide, this problem will get worse, not better.

Since Activision, Blizzard, and World of Warcraft are no longer catering to the type of game I prefer, I'm declining to give them any more of my money. This might change if they revise their policy, but judging by the attitude of the official response my complaint got, I do not consider this likely.

I am making a recommendation for anyone considering buying World of Warcraft or returning to the game after an absence NOT to do so.

Zero Hedge

Romney: [The] former head of Goldman Sachs, John Whitehead, was also the former head of the New York Federal Reserve. And I met with him, and he said as soon as the Fed stops buying all the debt that we're issuing--which they've been doing, the Fed's buying like three-quarters of the debt that America issues. He said, once that's over, he said we're going to have a failed Treasury auction, interest rates are going to have to go up. We're living in this borrowed fantasy world, where the government keeps on borrowing money. You know, we borrow this extra trillion a year, we wonder who's loaning us the trillion? The Chinese aren't loaning us anymore. The Russians aren't loaning it to us anymore. So who's giving us the trillion? And the answer is we're just making it up. The Federal Reserve is just taking it and saying, "Here, we're giving it." It's just made up money, and this does not augur well for our economic future. You know, some of these things are complex enough it's not easy for people to understand, but your point of saying, bankruptcy usually concentrates the mind.


And that is how the Fed effectively took over control of the United States, as without it, it is game over. This is also why the ongoing presidential election is a farce, and has absolutely no bearing or significance for the future of the US, whose true ruler does not reside at 1600 Pennsylvania Avenue, but instead holds America hostage in a powerful Stockholm Syndrome grip from the deep recesses of the Marriner Eccles building located, paradoxically, on Constitution Avenue.

Don't worry though: like any "true democracy", the real "leader" of the nation will never be eligible for popular vote. Ever.

This is the last beleagured, overwhelmed, line of defense of our welfare state. When people with money worldwide realize what's happening, they will be forced by economic reality to stop accepting dollars. When people with money to lend won't prop up the government, and people with things to sell won't accept dollars, the whole thing falls apart, and it's going to happen unbelievably fast.

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About this Archive

This page is an archive of entries from September 2012 listed from newest to oldest.

August 2012 is the previous archive.

October 2012 is the next archive.

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