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Painting a happy face on this taxmageddon is just putting lip stick on a pig. It’s just 45 days away until the US falls off the fiscal cliff and around $600 billion or 4% of Gross domestic product goes into the black hole of deficit spending from $450 billion in higher taxes on everyone not just the rich and an automatic $150 billion in spending cuts for a total of $600 billion shift in economic activity. For those with poor math skills pay attention to this, the taxes are not a plus to the GDP it is taken from existing GDP wages to employees and profits of companies

 

The current GDP growth rate is only 1.7% so far in 2012 and 4% of that will shift into the oblivion of deficit spending and deficit reduction and still leave us with an additional shortfall of $600 Billion in deficit spending. The CBO – congressional budget office has stated in their testimony to congress that just an increase in taxes on the rich of an estimated $80 Billion in tax increases will force a lose in jobs of 700,000 and a negative .5% GDP (½%) and or a recession. Now that number is just on the wealthiest and business owners has doubled to $160 billion a year in higher taxes to the wealthiest since the election and the simple math is negative -1% GDP and 1.5 million jobs lost just from taxing the rich not the taxmageddon that will tax the crap out of everyone and everything which is 3 times that number if they don’t do anything.

 

If you allow the bush tax cuts to expire January 1, 2013 than taxes go up on everyone including 25 million low-income Americans that don’t pay any federal tax at all will pay taxes. This is what the democrats voted for on November 6 2012 and all this will at the very least cause a decline in real terms of GDP gone missing of a negative – 2.5% of the GDP growth rate figured strate line without the projection of how businesses will react or how the spending habits of people will change and they will change dramatically more negative than a -2.5% growth rate decline.

 

The dollar amount lost by doing nothing and allowing current law to expire on January 1, 2013 and then tax rates go up 5% on every one who works and or pays taxes. it will cost the American workers and the rich $450 billion total and 150 billion in spending cuts totaling $600 billion then my estimate of job losses of 5 times the 700,000 jobs or 3.5 million jobs lost and the job losses will happen as fast as the money disappears from paychecks every week. The moneys just not there anymore for us to spend or save as it is taxed away at a rate of $1.2 billion a day from higher taxes to everyone. I want to repeat this part and make this clear, this is already the law, congress doesn’t have to vote on anything the existing laws will allow this to happen January 1, 2013 and congress doesn’t need to vote on anything it’s automatic. Next is why a deal will not be made and everyone working will get the 5% tax increase unless you move out of the country or your state succeeds from the union which neither is likely.

 

The political blame games and the real goals of the Democratic Party are why no deals will be made and why we will go off this fiscal Clift or so-called taxmageddon. This will be once again blamed on the republicans for what the democrats did. (There’s a 100 year history of this) The progressive, liberal democratic parties goal has been and still is to destroy the constitutional America we know and change us into a socialist dictatorship (I believe all the evidence shows we are already a socialist dictatorship and have been the last 3 years and 10 months and even possibly the last 12 years) and doing away with the constitution and replacing it with a communist constitution and this taxmageddon is exactly what the democrats need to do that and they will try to make it look like the republicans fault (this is already being done) and the lame stream liberal progressive socialist media will help them do it with their normal lies and disinformation.

 

Here is what to expect in the next 47 days. A lot of grand standing by democrats telling you conservatives economic policies are why the economies is so bad and its Bush’s fault even know the democrats have controlled congress for almost the last 6 years.

 

It’s at this point I want to inform and or remind everyone who reads this. The democrats have now controlled congress for 5 years and 10 months the reason the economy went off the Clift and the banks collapsed in 2008 was under the control of the Democratic Party for 21 months it was not the Republicans it was the democrat controlled congress that did it by their actions or lack of actions. To believe otherwise means you have been misinformed and you believe the lies of the liberal progressive news media.

 

The democrats didn’t inherit this economic mess they caused it. http://wp.me/pO1Ho-9w 

 

So if you still think this was all done by Bush your eating the little balls of crap the liberal media has been feeding you for your entire life and the last 6 years. All you need to do is a search for congress January 2007 to 2012 and you will see the democrats have controlled everything for the whole time period and then blames republicans and Bush for what they did. To say well that’s just politics does not make it right and it doesn’t fix the mess we are in. If they are getting away with these lies it’s because some Americans like those voting in democrat party for the democratic party are allowing them to get away with it. I don’t get my news from fox I seek the truth always this is the real no spin zone. I go to the federal record and look at the numbers and if you really want the truth it’s in the numbers not the news media they all sound like parrots to me spinning their stories as they see the truth with 10 different versions or opinions about the same story and none of them are right.

 

Facts compared to opinion and views. The glass is half full or is it half empty? No matter what you opinion or view is; the same amount of water resides in the glass. its math and math is not an opinion or a view. This goes to the next part the historical events of the past that can give us a clear picture of the possibilities and the near term effects of economic events like taxmageddon.

 

I have seen many economist discuss this $450 billion tax increase like it’s a good thing and the value of the dollar will increase because the deficit would shrink and that’s would be a good thing under normal text-book economic conditions it would be, except for the facts they seem to forget that we would definitely go into a very deep recession or depression from a $450 billion tax increase and while we have a deficit of $16.4 trillion hanging over our heads that’s not good for bonds or the value of the dollar if we are borrowing $600 billion while the economy is shrinking at a rate of 3% and could quickly go 6% negative GDP  it is likely under these conditions no one will loan us any money and people who hold our bonds would sell them very fast causing a panic sell off or a crash in the bond markets.

 

This has happened before in 1980. I can tell you right now when the economy starts to decline and go into a recession under the new much higher tax rates that what the economist are telling you say it’s a good thing is idiotic and that’s being kind. As the whole dynamics of the entire economy changes very quickly in economic declines the stock markets and bond markets will change and go into a severe decline and bond markets will be up for a few days maybe and then be sold off to cover losses in other stock markets and commodities markets this is always a worldwide event and everything will all change dramatically as well. None of it will be good. It will all be bad news (do you have a 401-K) and even before the first dollar in higher taxes is stolen away from the rich, the middle class and working poor this will unfold and become history. When this happens and it will, the economists college degrees can all be thrown out the window or used as toilet paper because nothing works in severe declines. I have been in 3 severe economic declines or crashes as a business owner and an investor.

 

Currently what gives the dollars or the bonds the value they do have is the confidence that the government can pay the interest on the debt and that confidence level all changes if we go into a recession. Confidence is nothing more than a thought and as quick as we can change our minds or in one day that confidence could disipere and this could cause a second bond market collapse worse than the one in 1980 because the debt is 32 times larger than in 1980

 

The Bond Market Collapse of February 1980 The time is November, 1979; the place, the White House. Like in November 2012, a dark financial cloud hovers over Washington — not only fiscal troubles, but also the threat of hyperinflation.

 

President Jimmy Carter and Congress have been gridlocked for months, unable to deal with the brewing storm. Unlike November 2012, the next presidential election is a year away. But investors don’t wait for the ballots. Nor do they have to. They begin issuing their sell orders immediately, venting their wrath primarily in the U.S. bond market by dumping medium and long-term U.S. Treasury securities. Treasury bond prices collapse, while interest rates surge. (We are set up for this perfect storm once again triggered by taxmageddon)

 

The tipping point comes on February 5, 1980. That’s when Treasury bond prices fall so far that their yields surge above the 11% level the all-time peak reached during the Civil War. “Faced with a prolonged buyer’s strike,” says one bond market pro, “we decided to throw in the towel and get yields up to a level where some cash buyers might be shocked off the sidelines.” But the next day, panicky bondholders begin unloading bonds at any price … and there are still few takers even at record interest rates everyone is still selling. The selling is so intense that all except two of the largest, best-capitalized bond dealers on Wall Street Merrill Lynch and Solomon Brothers effectively abandon their market-making role.

 

Now, it’s no longer merely a case of a price collapse. It’s a market collapse in the literal sense of the word: The dealers themselves are packing up and going home! By February 19, the collapse gathers even more momentum, as Treasury bonds lose over 5% of their face value in a single trading day!

 

Investors aren’t just shouting their protests from the rooftops. They are shutting down the market for U.S. Treasury securities, making it impossible for the U.S. government to borrow the money it needs to stay alive — and to avoid defaults on maturing debts. 

 

Result: With Paul Volcker (idiot) at his side, President Carter (another idiot) acts, announcing an anti-inflation bombshell: An unprecedented package of CREDIT CONTROLS that clamps down on virtually all forms of credit. (Dodd-Frank bank regulations will have same effects) The U.S. economy is pushed over a cliff and into a tailspin. Carter’s chances for re-election are doomed. But the bond market recovers and the U.S. Treasury is able to resume borrowing. 

 

But this all happened when the total of all federal deficits was about $ 500 Billion and now its $16.4 trillion anything even ½ of that historical recount would destroy the country and the dollar. Inflation ran between 12% and 15% in that period from 1977 to 1982 and bonds sold are governments borrowing money to finance the spending of money they don’t have. Just imagine if this only in part happens in such a weak economy and with borrowed money amounts $16.4 trillion and a need for a least and additional $50 billion a month after taxmageddon. While at the same time the economy is in a steep decline with a president that’s adverse to business. (The perfect economic storm that will end America) This also really screws up all the CBO estimates of the impact of the recession caused by taxmageddon and things will get a lot worse than there projected declines. The economy is always a moving target.

 

It was massive deficits of that time period that caused this to happen and those deficits were only $50 billion to $75 billion a year and now there over $1 trillion a year. This extremely high 16% interest rate at the peak is what the market set is the sacrifice that investors demanded in order to kill the threat of hyperinflation or the extreme devaluation of a currency. It really never worked but they won’t tell you this because it makes both Carter and Volker look like the idiots they are. Inflation remained high and the higher interest rate had only one purpose atract money to finance deficit spending. The higher interest rates fueled inflation in higher cost to barrow money that doest reduce cost it increases cost thus inflation increases. Liberal progressives always get it backwards. This is what Washington ultimately delivered. That at least in part will happen with taxmageddon coming in just 7 weeks. (Merry Christmas)

 

The general notion here is that, given the root causes of our economic distemper, rampant financialization, over-leverage and over-indebtedness, a politically dominant parasitic banking sector, an aging population, over promised entitlements, a financial business model based on fraud, Federal Reserve monetizing of debt, and a dysfunctional political system, to mention only the top of the list how can the USD appreciate in real terms? It cannot! It only has one way to go and that’s down. There only needs to be a trigger to set this whole decline into motion and I believe its taxmageddon.

 

This is how investors play the markets and why the dramatic decline or a crash will become obvious in the next 45 days or less. Businesses and market players make their decisions based on future projections of business activity and profits or the lack of profits. All market investment is determined by future projections or guesses of economic activity 6 months before they accrue not afterwards. You can expect a crash or at least a major correction of a few thousand points in the next few weeks and up to the week before January 1, 2013. Just like the decline after the banks collapsed in September 2008 this decline will continue well into 2013 just like the one in 2008.

 

Either way whatever happens in Congress the democrats will not make a deal because they want the economic collapse. They want the crash and they need it because democrats want the country to end as we know it so they can abolish the constitution. Making a deal with the democrats and Obama will not happen and their actions and the long history of changing constitutional law through the Supreme Court in the last 100 years and especially the last 4 years of ignoring constitutional law and playing dictator or King at every turn should prove that to people who have been paying attention Democrats hate the constitution.

 

Liberal progressive democrats have worked hard to circumvent the constitution and make unconstitutional law legal through the courts. It’s a term called judicial activism. This entire deal making process will be like trying to negotiate with a terrorist that wants to kill you, it’s a useless endeavor. Democrats’ have a long history of behavior that never changes in the liberal progressive Democratic Party. So why would any sane reasonable person expect that to suddenly change now? Liberal, progressive, Democrats want an economic collapse.

 

The conservative media will keep doing what they always do giving the benefit of the doubt to the liberal democrats and they will hope and or wish that Obama and the democrats will find a middle ground or a compromise with republicans, but the last 4 years of their actions shows that doesn’t fit Obama’s or the democrats play book. It’s always their way or the highway anything else is just imaginings and hopeful thinking so far hope has gotten us into this horrible position. The only compromises made have gotten us to the current fiscal Clift otherwise known as taxmageddon everything else has been my way or the highway with the democrat’s control of the senate and Obama. I think the democrats set America up perfectly for total economic destruction with an expiration date January 1, 2013

 

You can’t make a deal with the devil and expect anything good to come from it. I don’t think John Bonner will make a deal with the devil and if he does there’s a price to pay either way all Americans will lose no matter what our politics are.

 

What you are about to witness few weeks and months no one alive has ever seen before. This will be way worse than the great depression or the civil war. Hell on earth is what is coming and it’s not years away it’s only a matter of weeks and months and I repeat it’s not years away. To think this destructive pattern of the democrats’ and Obama can continue and Americas economy can survive 4 more years is just wishful thinking.

 

You can Hope I am wrong as I really hope I am wrong, but I said in back in 2004 and in my book 2012 that came out in November 2009 this president Obama would be the last president of the United States and so far I was right. From 40 years of observing politics and studying political history. I understand how a liberal thinks and they don’t use logic. This lack of logic is why all their ideas and policies always fail it is a form of insanity and that’s why what I say here may not make any sense to a sane person but their is no logic to there thinking it is insanity.

 

We don’t have 4 more years under any president or any dictator. The book 2012 explains it all. I said in 2009 it would either happen in 2012 or by the middle of 2013 and now we are just weeks away. You will see this unfold in the next 6 to 7 weeks in the stock markets as I expect a 2500 point correction from the September highs and so far it 1000 points down with 1500 to go and it will get a lot worse in early 2013.

 

I really hope I am wrong and I know you do too.

 

By the way very soon after taxmageddon and I mean very soon after we fall apart, the real Armageddon between Israel and Iran will start. First it will be conventional weapons but it will escalate quickly after other Arab countries join Iran in an all out WAR and an attack on Israel. Israel is surrounded by nothing but enemies with combined armies in the millions and with no allies. Regardless of what Democrats say or Obama he will not back Israel, Obama is a Muslim he will side with the Muslims. If attacked by multiple countries at one time Israel will have only one choice and that’s nuclear weapons = Armageddon. Israel has claimed 80 nuclear weapons and that’s enough to destroy all the Arab or Muslim countries major cities. The deadline for this is March 2013 set by Israeli Prime Minister Benjamin Netanyahu. Here it comes! 200 million dead in one day is very possible with 80 nuclear weapons and the real sh-t hits the fan.

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The liberal media is at it again and no one ever bothers to check their story or their math. The so-called economists or economic advisors should be ashamed of their mistake because it so big. It’s hard to believe anyone could be considered an economist or an advisor and miss the number so badly.

 

I am going to show you the math to prove Obama’s so-called $60 Billion jobs bill will not create 1.9 million jobs it will only create 589,000 jobs. So the so-called economists missed the numbers by 1,311,000 jobs. In my industry that’s an inexcusable mistake. It’s obvious to me there lying for Obama and the liberal progressive Democratic Party. (Surprised?)

 

First I want to show you how they came up with the number 1.9 million from the $60 Billion spent on infrastructure and that is roads, bridges, renovations of schools or construction jobs. We take the $60 billion and divide it by the 1.9 million and it comes out to be $31,578.95 per job. That number is about right based on a $12.00 per hour and adding the cost on labor like workman’s compensation, unemployment insurance, employer’s contribution of social security and liability insurance on labor. My number based on $12.00 hour base wage came to be $31,200.00 a year. So there number is close on that point, but there 1.9 million jobs is figuring 100% of the $60 billion is all labor and that’s just plain wrong!

 

Here is the thing” I did construction bidding for more than 30 years and there’s a lot more to estimate a job then just labor and that’s the way their number works out there’s no money for materials and overhead cost or shameless, obscene  profits.

 

The very most basics of construction bidding practices are materials, overhead and labor cost, not just labor and let’s not forget those shameful obscene profits.

 

It seems they forgot about the cost of materials and what about the cost of overhead like trucks, office expenses and all the unseen expenses of running a construction business. The point is the so-called economists either don’t have a clue of what it’s like to run a business and they don’t know what they’re talking about or they just lied. Which of the two do you think it is? I think they don’t have a clue and they lied. This has been the pattern of the Democratic Party for the last 100 years and that’s never going to change it’s who they are.

 

The whole Democratic Party is based on lies they depend on their voter’s ignorance to get reelected.

 

Now I am going to show you why the so-called jobs bill will only create 589,000 jobs, not 1.9 million jobs

 

We start with $60 Billion and use the 31% labor average which is the standard for labor cost in the construction industry and just happens to be the national average for the whole economy based on numbers from the department of labor and statistics.

 

I derive my 31% labor by using the average wage, average number weekly hours multiplied by the yearly total yearly wage and divided into GDP to get the percentage of labor and that’s 31%.

 

To find the appropriate amount of labor in the $60 billion jobs bill we multiply it times the 31% labor average and it comes out the amount of labor is 18,600,000,000 then we divide that by their yearly wage $31,578 and that’s 589,007 jobs. That’s a very big difference from 1.9 million jobs and it’s a mistake of 1,310,993 jobs. Whoever made that large of a mistake should be fired.

 

The rest of the $60 billion less labor would be spent for materials, overhead and there must be a profit. This is exactly what they did in the first so-called stimulus bill passed in January of 2009 they said would create millions of jobs that never materialize and the dollar amount was about the same $60 billion for construction and infrastructure out of the $867 billion stimulus bill. This is just more of the same Bull shit.

 

I do realize this is just a political move to blame the republicans for Obama’s bad economy and the lack of jobs by not passing the jobs bill. But that will only work on the dummies that would vote for Obama anyway in 2012. One of the biggest reasons Obama won in 2008 was the very low turnout of the 55 million registered republicans, many never showed up to vote and that’s part of why McCain lost and Obama won.

 

Obama’s jobs bill is not the answer, the liberal, progressive democrats federal government spending is the problem.

 

If they use the excuse that some jobs will be created from incomes from this so-called jobs bill it will not be what they expect. Most business are not hiring because they don’t have the volume of business to hire new employees and some of their employees are part-time. If business does get better and extra manpower is needed that will be supplied by existing part-time employees until business gets really good and this jobs bill isn’t going to do it. There estimates on this will be way off as well as their other goofy estimates.

 

Also the same goes for the construction companies that would bid this work. They also have part-time employees because they don’t have enough work for a 40 hour work week now. Anyone who would get these government contracts would just use their part-time people and only add a few extra people. My whole family is in construction we do home improvement, renovation work and this is the case not a theory or a guess, it is the situation across the country.  

Another problem is the construction industry is or was 85% illegal aliens prior to the collapse of the construction industry. This makes it very difficult to recognize any large numbers of jobs for Americans. Most of the money and jobs in this bill will go to illegal aliens and 1/3 their money will be sent to South America. We have never hired one illegal alien and I guess that makes me a racist.

 

The only way to fix the economy is to rely on the part that still provides 120 million jobs and that’s the private sector corporations and small business.

 

The jobs Obama’s bill is supposed to create are like all the other jobs he has created they are temporary they will go away when the money runs out.

 

Government jobs are going away, the states governments are cutting their budgets they have run out of money and total number of government jobs are going away. There broke!

 

Government is the problem not the answer. The deficit spending from the federal government is sucking all the available money out of the banking system and a lot more from the worlds banking system. They are barrowing about $4 billion a day, about $126 billion a month and $1.5 trillion each year. As long as this continues there will be no recovery and there’s no end in sight.

 

The federal deficit is why our economy and Europe’s economy isn’t growing and adjusted for inflation they are shrinking and it’s all because the governments here and over there are sucking the banks dry. Governments are borrowing all the available money in the banking system and there is very little left for the private sector companies or the people to barrow and grow the economies. Then the politicians blame it on the banks to divert the blame from them.

 

The small cuts in the budget deficit the supper committee is trying to make of $120 billion a year are a drop in the bucket compared to the huge $1.5 trillion in deficit spending and will make very little difference.

 

Any increase in taxes to the rich just makes less money available in the private sector economy for the creation of jobs from an expansion in the private sector economy. This is the dumbest thing I ever heard next to the last dumbest thing and that was also one of the democrats and Obama’s brainstorms, the $867 Billion stimulus that didn’t stimulate anything except to increase the deficit by $867 Billion.

 

Here is the democrats and Obama’s newest plan: we take $70 billion in new taxes from the incomes of the small business and transfer that tax money to the federal government, than the government spends $60 billion to create jobs. How does that add to the economy or the GDP? It’s like taking buckets of water out of a lake and carrying it to the other side and dumping back into the same lake expecting the water level to rise? Or like standing in the bucket and trying to lift yourself up, it’s never going to happen.

 

These are the idiots someone put in charge of the country. Liberal progressive Democrats’ have proven they all have very poor math skills and serious sociological problems. You will lose a greater number of jobs in the private sector economy then the government created jobs will produce.

 

They also claimed these jobs will happen in 12 months but that will never happen. It will take at least 1 year to get started and another 18 months after that to complete most of the projects. That’s because of all the layers of bureaucracy on the federal level and then in the states. It’s impossible for them to do it in one year. Remember how shovel ready wasn’t really shovel ready?

 

The so-called economists and economic advisors are almost always wrong. When the economic reports come out why are they always surprised? If they were any good they wouldn’t be so wrong, so much. I wished I could get paid to be wrong all the time. Maybe I should run for president?

 

 

 

 

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Fromt cover of 2012 size 128 x 192 small

2012 cover

The talking heads make generalizations about the negative effects of higher priced gasoline and crude oil costs but they never seem to tell you what those effects are in numbers. What I will attempt to do here is show the math and how that translates into a specific number of jobs that are lost for the resent $.60 increase and every dollar increase in the cost of gasoline or crude oil. And the reason for this is what will come in the next few months as the current higher price of crude oil will divert about $13.9 Billion each month is diverted away from other industries. There is an equation to figure the number of jobs lost from higher crude oil prices. 31% of all dollars spent in the gross domestic product of the country is labor.

There is only so much money in the economic system at a given time. Just like a wage earner only gets a certain amount of money in his check every week and as prices go up on gas he has less money to spend on other items. When prices move rapidly upwards wages do not have a time to adjust to this increased prices. So any additional monies spent on higher priced gasoline as a direct and immediate effect on the overall economy. There are approximately 260,000,000 automobiles in America almost every one of them needs gasoline or diesel fuel every week. So even if people aren’t complaining about $12 a week increase it’s costing them for the gasoline it has to be multiplied by the total number of automobiles in the country and that number is huge as it numbers in the many billions of dollars every month that disappears and goes up in little puffs of smoke.

I know most Americans only think about gasoline prices in terms of how it costs them every week they complain about the $10 or $20 extra they’re spending. No one ever thinks about the many billions of gallons of gas we use every week and that translates into billions of dollars it costs the entire economy. No one ever seems to think of where the money goes or that it actually goes nowhere as it is used and it goes up in smoke. Most of the money goes overseas or to Canada or Mexico and even Venezuela. The government and the politicians always blame it on the greed of the big oil companies but are in fact the politicians that created the situation and conveniently blame it on the big oil companies. This obviously does work as everybody I’ve ever talked to blame on the gas station owner or the big oil companies so it works to give cover to the politicians that created the mess.

What I will use is the total number of gallons of crude oil used in the country which are refined into gasoline diesel fuel and many other products that we use. But to make it clear for the average citizen to understand I will use the price at the gas pump because that is what we see every week. Calculating it this way also will closely cover other uses for crude oil products like plastics fertilizer and anything else that comes from crude oil as it has many uses in manufacturing. Our entire economy has been built and structured around the automobile and the use of petroleum products. The higher prices of crude oil shows up in nearly everything we purchase. Here comes the math so you should get your bottle aspirin out in case it gives you a headache.

Now let’s take that number and figure out the actual job losses based on 31% of that money spent would be labor or jobs and this can be calculated from the hourly work week and wage averages at Department of Labor statistics. All money spent in the economy or the gross domestic product works out to be 31% is a labor calculation based on information provided at the Department of labor and statistics and calculated into estimated current $14.7 trillion economy.

We use 550 million barrels crude oil each month and 6.5 billion barrels a year. Each barrel of crude contains 42 gallons. The total gallons of crude oil used are 23,100,000,000 each month. (23.1 billion) If we take that and multiply it times a most recent increase of $.60 per gallon it totals $13.9 billion a month that just disappears. Gasoline price increases are Just like taking a $13.9 billion a month putting it in a pile and setting it on fire, it just disappears. We’re not buying additional product, we are paying more money for the same amount of product. This has the same effect as the gross domestic product shrinking by the same dollar amount on a yearly basis that is one $167 billion. This is just for a $.60 per gallon increase in price over the last 120 days.

If you take $13.9 billion a month at 31% the total labor amount lost is $4.3 billion. If you take the average national wage of $50,000 per year per employee you get a total job losses number of 86,000 jobs lost each month and this is a cumulative month over month. To get a yearly total at 86,000 lost jobs per month we have to multiply times 12 months to get the yearly total of lost jobs and that number is 1,032,000 jobs lost yearly. This is with just a $.60 per gallon increase over what I believe the price of $2.50 a gallon is the average threshold of affordability. The price has steadily increased over last four months. It takes 3 to 4 months for any changes in the economy actually show up in government employment reports. Next we will look at what happens if the price goes even higher. Doing this calculation you will see the extreme negative effect of higher priced gasoline or crude oil has on the economy and the job losses caused from the increase.

They are calling for the price of gas to increase by another dollar per gallon up to the old highs of $4.00 per gallon by July of 2011. I have done the math on that and it will absolutely force us into another recession and we really are not out of the one we are in yet. Let’s do a calculation based on the price of gas going from the August price of $2.50 and an increasing to $4.00 a gallon by July of 2011. The higher price of gasoline is not an investment it is something that we burn and it disappears. Gasoline or diesel is not a product that we can place in our house and admire. Once we’re done with it we cannot resell it as it no longer exists and is gone forever and so is the money we spend on it.

The total gallons of crude oil used each month are 23,100,000,000. (23.1 billion) if we take that and multiply it times a $1.50 per gallon increase over the $2.50 threshold of affordability we get the total dollar amount $34.65 billion spent monthly from the increased cost of crude oil. Then we calculate the labor of 31% of that number and we get $10.74 billion in lost wages every month let’s figure the lost jobs based on the $50,000 per year average salary in America. The total monthly lost in jobs from this increase of $1.50 a gallon is 214,800 jobs a month. To get the yearly we multiply that time’s 12 and we get 2,568,000 job losses on a yearly basis. This is what high-priced oil will do to the economy and the job market. This also coincides with the job losses back in 2008 when gasoline did go above $4.00 a gallon and stayed there for many months until the bank collapsed. The monthly job loss range in 2008 was between 250,000 to 480,000 jobs lost each month up until the banks collapsed in September 2008. Only then did the price come down because the money wasn’t there to buy the futures contracts in the commodities market to keep the prices high.

We have politicians like Al Gore who said we need $8.00 gallon gasoline so that bio fuels and other alternative fuels can compete with the cost of gasoline. We have liberal and progressive talking heads who say we should tax gasoline five dollars a gallon which of course would push it up to eight dollars a gallon that liberals and progressives want. We have had actions or regulations from the Democratic Party for over 30 years which have not allowed our oil companies in the US to drill for oil on any US lands where we know there is oil, like Alaska which is said to have more oil than Saudi Arabia. Our American owned oil companies are only allowed to explore for oil where we know there is none because the lands have already been explored. In offshore drilling oil companies are only allowed to drill in international waters hundred miles off the coast in 5000 to 7000 feet of water or over a mile deep which is very expensive. They do this when we already know that almost all the oil in the Gulf of Mexico lies between 15 and 50 miles of shoreline and in shallow water where it is very easy and cheap to get but liberal progressive Democrats will not allow our oil companies to drill there.

The oil industry is one of the heaviest regulated industries next to healthcare. We have gone from being 30% dependent upon imported crude oil to 72% reliant on imported crude oil since the creation of the Department of Energy.

Nothing the liberal progressive Democratic Party has done for more than 30 years makes any sense other than to do things that would potentially push the price of crude oil sky-high. It is by the actions of legislation and the regulation and the creation of the Department of Energy that has destroyed our oil industry. It has gone way past the point of being a national security issue. If something were to happen in the Middle East like a war between Israel and Iran that would cut off a part of the world oil supply. We get very little of our oil from the Middle East only about 10% but it’s not about how much oil we get from the Middle East it’s about the world oil market prices based on commodities exchanges daily trading. It would force the futures market price up dramatically and we could see $8.00 a gallon gasoline in just a few weeks. Looking at the estimate of just four dollars a gallon and job losses from a $1.50 a gallon price increase let’s take a look at what a $5.50 a gallon increase over the $2.50 a gallon price would do as the money disappears from the economy.

Let’s do a calculation based on a $5.50 per gallon price increase the numbers above comes out to be around 784,738 jobs per month lost or 9,416,856 a year and of course that would collapse the economy. I think that’s really what liberal progressive Democrats want to do because that’s what they say they want and that’s the way the math works out, if they get what they want. So destroying the economy is what they want to do. If they can’t do the math they shouldn’t be in the office that they hold because that means they’re not smart enough to see the consequences of their actions and they do not belong in Congress no matter who their constituents are.

The strategic oil reserve that the US government holds would last about 40 days if we have to supply all our own petroleum from it. Most people don’t realize how many billions of gallons of gasoline will use every week. The strategic oil reserve holds 727 million barrels are stored in four hollowed-out salt domes along the coastline of the Gulf of Mexico. At 550 million barrels a month or at 23,000,000,000 gallons of crude consumption we would use that entire strategic oil reserve every 40 days. This adds up to some 62 days’ worth of imports, we cannot rely on this in any long-term disruptions as wars can go on for years. Even though we may only need small amounts of the strategic oil reserve to supplement a shortage, the price is more about the commodities market price than it is how much crude oil we have to take from that reserve. There is another factor in that is the strategic oil reserve is in the form of unrefined crude oil and we only get 19 gallons of gasoline from every 42 gallons of crude oil or per barrel and that greatly reduces the number of days we will be able to fuel the fleet of 260 million cars.

The liberals and progressives or the Democratic Party and the talking heads run their mouths without ever doing the math and figuring out what they say will do to the economy. You ever notice when they talk about oil or coal how angry they get, they act emotionally disturbed. They have no real answers only complaints. Not one of them have ever figured out how devastating each additional dollar a gallon gasoline in price would affect the economy, not even that so-called genius Al Gore who only seems to be able to figure out the tonnage of carbon we dump into the atmosphere But not the cost of eight dollars gallon gasoline to the American people and the damage that does to the economy.

What will work is Slim Pickens plan to change the country over to natural gas. This idea is brilliant and the numbers work out in a way that would save the American economy about $378 billion per year in fuel costs when compared to $3.00 gasoline. Going by the price of three dollars a gallon for gasoline and translating that into natural gas gives you a price comparison of $1.50 per gallon to get the same mileage as a gallon of gasoline would give you.  Now this Slim Pickens number is based on $10 per CFM of natural gas. Here’s the beautiful thing about it, the current cost of the CFM of natural gas is in the $4 range not $10. So we are talking something like about $.60 per gallon. This would save the economy about $700 billion a year. This would create huge surplus amounts of money in the American people’s pockets that could be spent to increase the standard living. You would see an economic boom like we’ve never seen before. The balance of trade would come into line because 72% of all that crude oil money goes out of the country every month. The trade imbalance we have with other countries is more than 50% because of imports of crude oil. Mr. Slim Pickens is a great American, a real patriot who cares about the country and has done what he can to help preserve it. He can see that our dependency on oil is destroying us and he believes it is a national security issue on top of the peak oil theory that the world is running out of oil. Since our economy is 100% dependent upon crude oil we have to change to something we can supply in country at a reasonable price and that is natural gas.

In contrast with the Democrats plans like Al Gore, Nancy Pelosi and all the other famous liberals or progressives plan proposes the eight dollars a gallon gasoline this reduces the American standard living dramatically to a banana republic. The problem with a banana republic is the currency and economy collapses completely way before we ever get to the banana republic economy. We have so much natural gas in our country we could run 100% of our automobile fleet off natural gas in our supply would last for at least 50 years and that puts us into the year 2061. If we were to change to natural gas that industry alone is estimated to create 2.5 million jobs directly and many millions more from the high paying jobs created in the oil and gas industry. We would be in fact be taking jobs that are now in foreign countries and bringing them back into the United States by the millions. By the year 2061 our technology will have advanced enough to go to something that uses no fuels of any kind. We would probably have a colony on Mars by 2061 if we would use Slim Pickens plan we would have all kinds of extra money for all kinds of new technology

The current alternative energy, battery power or hydrogen is insufficient for our current economy and far too expensive. An example would be a hydrogen powered car I checked it out, is $900,000 how many Americans can afford that? The cost of the new Chevy volt is $40,000 and you can still buy a cheap new car for $16,000 so how does that help America? The answer is it doesn’t and it does quite the opposite it pushes up the cost of an automobile not down. The cost of manufacturing bio fuels when compared to gasoline is $6.50 a gallon. Americans incomes have not gone up in the last 10 years when adjusted for inflation incomes are in fact negative. But at the same time the Democrats want to double and triple the cost of transportation to the American people. Where is there any logic or common sense when it comes to the thinking process of a liberal progressive Democrat? They live in a dreamland or fantasy land, you take your pick they both fit. My thinking process deals with numbers and facts not fantasies.

Slim Pickens started to talk to Congressman and the president Barack Obama way back at the beginning of 2008 and even as far back as early 2007. To show you how interested the Liberal progressives Democrats really are about global warming or alternative energy, not one thing has been done and it’s been four years now. Not even one little thing or step towards using natural gas has been achieved.

Here’s an explanation to why and it’s just common sense. It takes away their whipping boy the big oil companies. it also takes away their big worldwide wealth redistribution program of tax and crap. So that should prove by use of common sense and their lack of interest in changing to natural gas this proves to me they have other motives and those motives are really bad for the American people. Natural gas has almost zero carbon emissions you cannot charge a carbon tax on fuel that has no carbon pollution and you would think the nature Nazi’s would like that but it’s not really about air pollution or carbon in the atmosphere, it’s is an excuse for furthering wealth redistribution that is built into their crap and tax plan, wealth redistribution is what Liberal, progressive Democrats are famous for.

As I have watched the liberal progressive Democrats try as hard they can to destroy the United States from within for about 34 years now. Here is the only thing that makes any sense. If I wanted to devise a plan to destroy the United States from within I would do exactly what the liberal progressive Democrats have done. Since I’ve been watching them for the last 34 years this is what I have observed as the results of their actions. Could it be that they are so stupid that they don’t see what they’re doing? Every single program and all of their actions that Democrats have taken since I’ve been an adult have had the opposite effect of what they tell the American people they are supposed to do. Like the Department of Energy for example created to reduce our dependency on foreign oil from 30% in 1978 when it was created but the results have been were now 72% dependent on foreign oil in 2010. And it’s killing our economy and our country.

All these numbers are rounded off but are very close to actual crude oil consumption and the prices are only a few pennies off. The number of job losses is only to show trends and the direction of economic activity based on simple math and how the economics of our country work. The information is either from the Department of Labor statistics or it comes from the Congressional Budget Office gross domestic product report. These numbers are not meant to be exact to the penny they are rounded off in dollars and depending on where you look there not going to be exact anyway. These numbers change all the time but only by small amounts. So the outcome one year from now will be very close to the estimates we made if gasoline does go to four dollars a gallon.

 2012 What's really going to happen in 2012

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Fromt cover of 2012 size 128 x 192 small

2012 cover

What’s really going to happen in 2012 is a question that is asked about 1 million times a day worldwide on the Internet search engines. Many Webster’s have scurried to cash in on the near hysteria about 2012. There are hundreds of theories based on hundreds of theories with no facts to back any of their claims of disaster. At last count there were over 600,000 different websites based on the 2012 and end of the World theories. I can tell you right now it won’t be the end of the world. Although what I have to say will sure make it seem like the end of the world. I have researched many of these other 2012 websites of prophecies. I have researched the science and the history of man the geological history of the planet and there is zero evidence of any of the claims they make. They are all just making baseless claims to scare people and make money.

What I know and understand better than anyone is economics. 21 years ago I forecasted the scenario exactly like we now have in our politics and our economy. My focus has always been mainly on the US economy because it is the largest economy in the world. That 1990 forecast was that due to our politics and out of control deficit spending would eventually lead to a collapse banking system and a collapsed currency. I forecasted that we would have trillion-dollar deficits and it would lead to the destruction of our currency and our country and I wrote a book about it in 1990. I have recently written a new book to update the more current events and what will happen in the next few years up to 2013 and it’s all based on economics which has nothing to do with anyone’s prophecies just economic forecasting. This new book is called 2012 what’s really going to happen in 2012.

To be honest I’m trying to cash in on the 2012 hysteria just like everyone else by selling my book. Not for the same reasons as the others who have written about the end of the Mayan calendar in 2012 and then claiming it means some kind of end of the world scenario which it does not. The Mayans said little to nothing about any great disaster that comes on December 21, 2012. They’re in fact are no disaster Mayan prophecies only the end of the calendar and the start of a new one and that’s it. My purpose is to inform the public about the factual evidence. What I see coming in the form of economic forecasting for the American economy and the world economy. This happens in just two short years and needs to be told. It just so happens that my calculations and the amount of time it takes for this financial fiasco to completely unfold just happens to come around the year 2012 and could possibly happen in 2013 at the latest.

All the proof is within the government reports on the economy that comes out each month. Within these government reports you can find the evidence of everything that I say in the book 2012 or on this page or any other page that I write. The government just hopes you don’t find out or figure out what all these numbers really mean and who is responsible for this mess. I have a feeling that they’re not even smart enough to see it and that’s exactly what Alan Greenspan said about the bank collapsed in 2008. I knew what was going to happen to the banks and why in 2004, to me it was just simple mathematics. This really makes me wonder about the intelligence level of 800 economists’ that work at the Federal Reserve building in Washington DC and none of them saw it coming. I know a few people who work at the federal reserve and I know why they didn’t see it coming. I tried to warn people but nobody listened, they thought I was crazy and now we have exactly what I predicted in 1990 and in 2004, a collapse banking system and $60 trillion that just disappeared.

Now I will give an explanation of what I predict will happen in 2011 and lead up to the total collapse of the US economy in 2012.

This explanation will include the politics that created the mess and who the real culprits are that will eventually lead to the destruction of our country. To explain it without pointing out the people who did it would leave unanswered questions and cause people to blame innocent parties and that would be wrong.

Most people know about the more than a trillion-dollar per year deficit spending of the federal government. For those who do not know for the years 2008 two 2011 will have accumulated $6.1 trillion in additional deficit spending in just that four-year period. It took from the creation of the Federal Reserve in 1913 and up to the year 2007 for the total federal deficit spending to get the $9 trillion amount. That’s 94 years from the creation of the Federal Reserve. But it only took four years to add an additional $6.6 trillion to the public debt. With the passing of the bill that keeps federal income taxes to the current levels this will add an additional $450 billion to the deficit for the fiscal year 2011 which ends in September of this year. This will put the total public debt up to $15.6 trillion in this short period of just four short years. This was all done by the liberal progressive Democrats that controlled Congress from January 2007 to January 2011.

Presidents can’t spend one dime without Congress first approving the spending. The last budget that the Republican Party was responsible for had a $161 billion deficit and that was voted on by April 15, 2006 for the fiscal year 2007 that started October 1, 2006 and ended on September 31 2007. You can see the big difference after the democrats took control of congress and it cannot be blamed on the bank collapsed in 2008 because liberal progressive Democrats started their runaway spending by April 15, 2007 on their first budget which started in October 2007 and ran to September of 2008 and including off  budget deficits it was $900 billion the first year they took over Congress. Here is a chart to show all this out-of-control spending on this page.

https://jamesgarrett42.wordpress.com/2011/01/18/will-america-survive/

This page called Will America survive, also explains in a lot more detail the dates these budgets are made and how politics plays out. All this deficit spending money has to be borrowed under normal economic conditions. The real problem is there’s nobody with any real profits to buy the U.S. Treasury bonds at the average rate of $125 billion every month. Remember that in 2008 all banks went broke with the credit default swaps going worthless. It was said to cost the World Bank’s an estimated $60 trillion. So the question is where is all this money is coming from since all banks went broke or bankrupt in September of 2008?

All the economic growth worldwide is currently from governments printing of money trying to stimulate their economies. The answer to the question is that governments all over the world are just making money up out of thin air. Countries are buying huge amounts of debt bonds from the US with their printed up money. So what we have is their buying our worthless dollars with their worthless dollars. There’s no way this can continue without somewhere along the line the general public finding out what’s really going on and a severe devaluation of all paper currencies. Once investors realize what these governments are actually doing the confidence in these currencies will be lost and smart people will try to get their money out of these markets and the banks, then transferring their paper in some kind of a hard currency like gold or silver.

Here’s the problem; if everybody tries to sell all at once and creates another panic selloff much like we had after the 2008 bank collapse. If Stocks sold off very quickly and our markets dropped by as much as 1000 points a day like in 2008 and into early 2009. A panic of some kind is what I believe will trigger this next panic selloff in the bond markets and the trigger could be anyone of the major markets collapsing and that panic selloff going into the bond markets. It could be a major stock market correction or it could be the bond market itself in a panic selloff. But what I really think the trigger will be is a municipal bond market collapse here in the United States that will ripple into all markets here in the United States and around the world.

The most likely trigger setting all this on into motion will be the American municipal bond market. There are $2.8 trillion in city and state municipal bonds. These are bonds that were sold by the state or the city’s to build infrastructure like roads and bridges. This is additional money that is considered public debt is like U.S. Treasury’s but issued by the states and it should not be confused with the federal deficit it is additional to the federal deficit. A lot of these municipal bombs are held by union pension funds. There are currently many cities that have already default on these bonds and there are many more much larger cities that are threatening to file for bankruptcy wiping out these bonds entirely. (New York City and Los Angeles) We also have states right now like California and New York that are going to try to change the state laws to where they can also file bankruptcy because they can no longer afford to pay the interest on their municipal bond debt. Just one large union pension fund pulling a couple of billion dollars out of one particular municipal bond fund could set the whole thing in motion and create a panic. I saw something exactly like this happen to a bank back in 1985 and it caused a run on the bank and in three days it was closed. It was $1 billion bank and everybody lost their money.

The true status of the economy can be seen in tax collections by the states. Every quarter the states are reporting lower and lower tax collections on both employee’s wages and taxes on corporate Profits. So how can the economy be growing like all economists and talking heads are claiming on the boob tube, if every 90 days the states are collecting less in tax money? This evidence shows that American people are once again being lied to. All the evidence you need is on the Internet and all around you, all you need to do is look. The states and the federal government collect taxes on a percentage basis and if incomes are down and corporate profits are down; the dollar amounts in taxes collected also go down. This is the current situation in most states in America.

This collapse in the municipal bond market could be followed very closely by a collapse of the U.S. Treasury bond market which would trigger a huge selloff worldwide of all government bonds. The only thing that backs up these bonds is faith that they have worth or value. Faith is a thought and people can change their mind in a matter of seconds. A lose of faith is what causes panics and when people think they’re losing all their money they really panic. Here’s the problem: this is only the beginning. When this crash of the municipal bond market does take place it will domino into every major market in the country.

The bond market is tied directly into the banking system. Most banks keep their reserve funds invested in U.S. Treasury bonds and municipal bonds. Not only would the banks lose face value on the bonds they held if they didn’t sell them in the panic. It would put them under the legal reserve requirements required by the federal government and make many of the banks insolvent once again just like in 2008. This gives us a repeat of the 2008 bank collapse which triggers many other markets to collapse as well. This is where our real problems start.

Once this happens whole world will know that we have just been printing of money out of thin air to pay our interest on all are borrowing of money. Here’s a list of effects of a bond market collapse and it may not be in order but all these markets will be negatively affected at the same time as the bond market collapse. It will just take a longer for each affected market to show up publicly, depending upon which one it is. For example the real estate market would take two or three months to show up in any economic numbers even though the effects would be immediate.

When the bond market collapses the interest rates will skyrocket on that day and in the weeks to follow. The more people would continue to try to sell in the days that would follow a market crash higher the interest rate will go and the lower the face value would go. Under normal conditions the governments by intervening and buying their own debt bonds in the markets can keep interest rates low just like the record low-interest rates we have right now and the last two years. But in panics the government loses control and interest rates go to very high undesirable levels.

It’s at this point the cat is out of the bag and if the government wants to try to regain control to bring down interest rates as they were before the panic they have to come up with hundreds of billions and even trillions of dollars of more money made up out of thin air, digitized or printed up phony money. This money printed up out of thin air adds to the deficit and further exaggerates the problem. This is the exact scenario that can cause the hyperinflation of a currency.

If they try this, it takes a devaluing currency from the panic selloff of the bonds and devalues it even more. This is not really an option but it’s what governments normally do to try to keep the economy going as long as they can for the purpose of buying time and just praying by some miracle that the problem will go away on its own. We have survived these type panics in the past but we have never had the huge federal budget deficits as we have now. We have never been in a position that looks anything like what we have now. However we have a lot of history of countries and currencies collapsing. Looking at this history we are doing the exact same things to collapse our currency and that will destroy a country.

These higher interest rates on the bonds will directly affect the interest rate on a home mortgage loans. For Every percentage point in higher interest rates on bonds, the mortgage lenders will increase their interest rate at about the same amount. If the bond interest rate increases 3% then mortgage loans would go up from their current 5% to 8%. This leads to a second collapse in real estate market just like we had after the 2008 bank collapse. The value of real estate has dropped 30% or more since 2008. Only this collapse will be worse than the one you’re still in now and the reasons are as follows. Under the current economic conditions we could see an additional 30% drop in real estate values within months of this scenario and not over a three-year period. This has a secondary effect of causing all the collateral that the bank holds in real estate being worth less money than the dollar amount of the mortgage on the house. This makes all the banks in fact insolvent with loans outstanding much greater than the collateral that backs them up.

The higher interest that would be demanded by the holders of U.S. Treasury bonds would dramatically increase the interest that the federal government would have to pay on all its $15.6 trillion worth of debt by the end of 2011. The current interest paid on the US debt for 2011 is estimated to be $250 billion at about 3.3% interest. If this interest rate doubles so does that $250 billion and this would have to be added to the estimated deficit for 2011 of $1.5 trillion bringing the total to $1.75 trillion and that is only the on budget deficit and does not include off budget spending and adding the off budget deficit would put us in excess of a $2 trillion deficit for 2011. This will probably trigger another panic selloff as soon as these numbers are realized by the public and investors. What comes after the year 2011 is the year 2012.

The stock market will no doubt have a major correction if the bond market collapses. There’ll be trillions of dollars lost in the stock market and many trillions more in the bond markets face value of U.S. Treasury’s. These losses will be magnified in that U.S. Treasury’s are often borrowed against as collateral in the stock market by the big players like mutual funds and the like. As the face value the bonds dropped radically combined with large losses in the stock markets. There will be margin calls for cash to keep the portfolios solvent. When these things happen they feed on themselves because these portfolios are invested in stocks and bonds have to be sold to cover the losses from the leveraging. This feeds the panic and drives prices down and even more money is lost. This usually doesn’t stop until the markets are closed at the end of the day or they just stop all trading to halt the panic.

I have seen this happened two times before in the last 30 years. Back in the 1987 stock market crash and again at the September 2008 bank collapse. I was directly involved in one of these knowing it would happen before it happened to try to make money from the crashes. But in either case I lost money even know I was right about the crashes I still lost money, because you get caught up in the market and can’t get out. Because your positions are in the money they will not cash them in because someone has to be on the other end of the deal or trade and most people don’t understand that. The brokers never explain that to you because they make money off of buying and selling or the commission they received to make the trade.

There was a Treasury bond collapse around 1980 when Jimmy Carter was president. I was following politics and the economy very closely but I was not directly involved in the bond market or the stock market at that time. I can’t tell you much about that T-bill crash. I was too busy running my own business and watching its demise right along with the rest of the economy. The losses in that collapse of the bond market was said to be $2 trillion and that was 30 years ago. The bond market is many times larger now than it was in 1980.

The general public thinks the stock market is like a lottery with a pool of money just sitting there waiting to pay off your winnings, but it’s not. There are not billions of dollars sitting there to cash in your positions. But whether an investor is short or long on the market there has to be someone to take the other end of each position and if there’s not, you’re not going to get your money out. Even If you outright own the stock and want to sell it there has to be a buyer or else you’re stuck with it. You can lose it all if you’re highly leveraged or buying on a margin. I learned that the hard way and I didn’t lose all my money but it was enough to teach me not to be involved when these things happen. You may get lucky and be able to get out of market with a profit, but you can also lose more than half the money you had in the market as wildly fluctuating prices force your position from a profit to a loss. So my recommendation is stay away from all paper trades in any of these markets. If you do buy gold or silver don’t buy certificates or allow anyone to hold it for you and above all do not play the commodities market you’re almost guaranteed to lose your money there. Take delivery of the physical precious metal and keep it close to home.

Now comes inflation and hyperinflation or on more personal level that affects you and every citizen every time they go to buy food or gasoline you will see price increases weekly that will make your head spin. Every week when you go to buy food or gas you could see the price of gasoline increased by $.50 to one dollar a week. You could see food prices go up by 10% a week. Do I have to tell you how quickly this will destroy what’s left of the economy? It is at this point that we only have a few months left until total collapse af the economy. The average citizen can only afford inflation on these items in small amounts each year but not every week. The higher price of gasoline affects everything we buy as everything gets shipped to a store by truck. There is also petroleum in almost every product we buy. The farmers use a waste product from petroleum for fertilizer and this is one aspect of what pushes groceries up when petroleum prices increase.

As the cost of food and gas goes up dramatically other sectors of the economy will shrink for every dollar we spend on these two weekly expenses. Currently with crude oil at around $90 a barrel, gasoline at three dollars a gallon and food prices being what they are. We spend about 9% of the total economic output a year on these two commodities. (GDP) One way to do simple math and keep it easy to understand is that if these prices double then the additional 9% of the money we spend on food and gasoline will be diverted from other sectors of the economy. This will have the exact same effect on other sectors of the economy shrinking by 9% from their current levels when the money is diverted to the higher prices of food and gas.

The gross domestic product may increase just slightly to 3% or more, all of that growth will be from money diverted from other sectors of our economy. So while the government is telling us the economy is growing because they believe their own phony baloney headline numbers. The economy will actually be losing jobs at the rate of several hundred thousand each month from all the money being diverted to higher food and gasoline prices.

As our dollar devalues against all major currencies around the world they will demand more money on whatever they are selling us. We import about 70% of the products that are on the shelves of all stores in the United States. So what that means is almost everything we buy prices will increase dramatically. There is only so much money in the economy at a given time. The Federal Reserve is not going to rain trillions of dollars into our households like they did with the banking system. So what will happen is an any and all industry will be very negatively affected by all this diverted money being spent on higher food and gasoline prices. Like the services sector for example which makes up 80% of the economy will shrink and millions of jobs will be lost. So now we get the higher unemployment that comes along with higher food and gas prices as this money is diverted from all the other sectors of the economy.

This has the effect because of unemployment compensation of pushing deficits of both the states and the federal government even higher. Federal budgets and state budgets will collect even less in taxes month over month than they anticipate. This is very much like the scenario is playing out right now but the one I’m talking about will be much worse and a lot faster than our current slow decline. This would translate into either higher taxes or huge layoffs for state workers making things much worse than the current economic conditions.

This leads to the second big collapse of the world banking system. There will be millions more homes mortgages going into default on top of the 300,000 per month we have now. There’s also the effect in addition to all this, the treasury bonds that banks hold as their reserve requirements will have diminished greatly as the face value drops dramatically and this will put much the banking industry into an insolvent condition.

This almost complete collapse of the banking system will force the government to take over almost 100% of the banking system. Considering the faith that people have in their government right now I would say this will cause a physical run on the banks much like in the 1930s Great Depression. Here comes the biggest problem of all, if these physical runs take place there is nowhere as near enough paper money or cash in our system to cover the withdrawals. If just 10% percent of the people with bank accounts try to get their money out, all the banks and all at once the banking system will run out of money and collapse in two or three days. Banks are only required to keep about 7% of their total deposits in cash. A lot of this so-called cash reserve is invested in treasury bills. Just like back in the 1930s most of the money was loaned out and does not exist anymore. As soon as the paper money or digitized money runs out and it will only take a few days, all the banks will close. There was a run like this on a bank in California in 2008 with lines outside the door and around the building. I believe the banks name was indie Mac.there was also the unseen run on the banks using computers to transfer money from money market funds into other accounts at local banks. This has been directly attributed to the actual collapse of the credit default swaps that created a $60 trillion loss in the banking system.

If we get a panic like this and there is a physical runs like this, in three days the federal government would have close all the banks and this is exactly what happened in the 1930s Great Depression. Once this occurs and all the banks are closed, the whole economy stops dead in its tracks. This would mean the distribution system would collapse in just a few days and this is probably the worst thing that could take place in all of the things I have discussed.

If the distribution system collapses what does that mean? That would mean that all the gas stations would not have any gas. All the grocery stores would run out of food within a few days and very possibly within a few hours of something like this happening. No jobs will exist anywhere and the unemployment rate would be 100%. This all would be much worse than what happened on the Great Depression of the 1930s. Think about it for a minute; if all the banks were closed and you had a pay check to cash, where would you go to cash it if all the banks were closed. Your pay check would be worthless.

In the Great Depression of the 1930s most people were farmers or self-employed. The country was much more self-reliant back then. The situation we have today with 308 million people in the latest census of 2010 is that more than 50% of the population lives in or around cities and that means over 150 million people will have to migrate to where there is food and water. With large concentrations of huge numbers of people who live in cities and no food in the grocery stores and no farms nearby to get food from. No gasoline to put in your car to go to a farm to buy food or to hunt for your food. This will be much worse than just an economic collapse. With the collapse of the distribution system and closing of the banking system there will be no coal for the power plants and electricity will shortly afterwards just go off-line. This means no television and no entertainment centers in your house will work and no lights or anything else that runs off electricity would completely stop working.

There will be no government of any kind. There will be no police departments, fire departments or emergency services. All the hospitals would be closed. Everything that exists right now will stop if all the banks are closed.

We would literally within 2 to 3 weeks be living in the Stone Age. Every single piece of technology we have would no longer exist. This also means no fresh water supply as it stops with the electricity going off. People cannot live without fresh water to drink for more than three or four days. For survival city dwellers will have to leave the cities in huge numbers, by the tens of millions nationwide. This will be a disaster like mankind has never seen before. This will also be the situation in Europe as well as any developed country that uses large amounts of technology and is dependent upon the world distribution system.

This is all self-created and is primarily due to our politician’s lack of action going back to 2001. It is not George Bush’s fault as he and others like Alan Greenspan warned about this potential for a bank collapse like we finally did have in 2008. This was all self-inflicted and Due to a lack of regulation of the two mortgage banks Freddie and Fannie which are the two biggest mortgage lenders in United States and which are both partially government-owned. This is in fact were all the mortgage-backed securities originated from that caused the collapse of all the worlds banks in 2008. I have a video dated from 2001 it shows Alan Greenspan warning Barney Frank of a problem with Freddie and Fannie and nothing was done from 2001 and even up to now in 2011 these banks have not been regulate.

From what I’ve observed of the Federal Reserve and other government entities reporting on the economy for over 30 years of adjusting interest rates and regulations they are almost always wrong. Could it be that their numbers are so deluded or delusional that decisions based upon their phony baloney headline numbers is why they always overshoot when raising or lowering interest rates in the past? These bad decisions can directly be attributed to all our recessions over the past 30 years that I have been watching the Federal Reserve actions. I seem to know exactly when they’re going too far the day they go too far one way or the other.

The deflation or decrease in price in real estate will be zero help in this scenario as is not any help right now. Unless you’re buying a house the lower prices do not help you at all and should not even be counted in the equation of inflation or deflation under the current economic conditions. Under the current conditions of the housing market banks are requiring large down payments because the value of real estate is still dropping. This isn’t helping anyone.

The banks are also more reluctant to lend to people unless they have very high credit scores. Most activity going on right now in real estate that is being reported in the total housing sales numbers is just people refinancing their existing mortgages, it’s called a short sale. These refinancing numbers are included in the total number of houses being sold. This creates an allusion that things are better than they are. I just talk my buddy who’s been a real estate broker for over 30 years and he told me just what I told you here.

This is not old news it’s been going on for last three years and it’s still the same. If you really want to know what’s really going on in the economy you have to ask the business people on the streets. You cannot believe the propaganda of the news media like MSNBC business Channel who are actually spending all day long trying to get you to invest your money in the stock market. Their advertising base is almost all commodities and stock market brokerage firms and they make money off your money in the form of commissions on trades. Just like a salesman they have an interest in telling you everything you want to hear and everything is great so you will take your money and give it to them so they can make money off your money. If you shake the hand of these sales people you better count your fingers because you’re liable to be missing at least one if not a few.

Summary

Panic selloff in municipal bond markets

Causes panic selloff in U.S. Treasury bond markets

Causes panic selloff in world markets of all kinds

Causes second downturn in collapse of real estate market values

Causes second collapse of the banking system due to even more mortgage defaults

Causes collapse in real estate market due to higher interest rates and lack of affordability

All the above Causes huge layoffs and dramatically higher unemployment.

Higher unemployment causes further mortgage defaults and pushes Banks further into bankruptcy and insolvency.

Severe devaluation in the currency due to a lack of confidence in the government to bring its massive trillion-dollar deficits under control considering their now in excess of $2 trillion a year and growing.

This causes severe devaluation of the currency and much higher prices on commodities imported from overseas and in country. This means the price of gas and food could double or triple.

The doubling of the price of gasoline one which is currently three dollars a gallon and going to six dollars a gallon will by itself destroy what’s left of the economy.

The beginnings of the municipal bond market collapsing could be weeks or just a few months away as the state’s are seeking the right to file bankruptcies just like the cities already have. I believe this municipal bond crash could be the trigger that starts the whole of modern society to collapse. I wonder if the Republicans will be blamed for it. I’ll bet they do. I knew the liberal fringe lame stream news media better than they know themselves. I know what they’re going to do before they even know why they’re going to do it.

Just a little reminder for everyone to date this, today is January 25, 2011. The Democrats took office in January of 2007 and had control of Congress for four years. Everything that is going on right now with huge trillion dollars federal deficits can be very easily traced as 100% the result of the Democrats taking control of Congress in 2007. The banking system collapse of 2008 was from a lack of action from the two banking oversight committees that did nothing about a problem they were warned about at least 17 times starting at the very beginning of the Bush ministration in 2001. . These two banking committees were both chaired by Barney Frank and Chris Dodd. They are both Democrats and legislation to bring things under control and regulate the banks were brought up many times and these two Democrats stopped that legislation from even getting to the floor of Congress to be voted on.

I also believe that the huge deficit spending that the Democrats were orchestrating in 2007 and 2008 as soon as they took control of Congress was sucking all the money out of the banking system worldwide finance there deficit spending. If you look at the record of interest rates you can see how the Federal Reserve was steadily increasing the interest rate just six months after the Democrats took control in 2007 that was to attract the money to finance the runaway spending of the liberal progressive Democratic controlled Congress.

Doing just a little investigation on your own can prove what I’m telling you is the truth. It doesn’t take a genius to figure all this out. On this webpage you can research just about anything to do with government spending and it’s all based on government numbers it’s not my website, it all directly from the Congressional budget office and it supplies the actual downloads of the PDF for federal government spending.

http://www.usgovernmentspending.com/federal_deficit_chart.html

I made a chart that just shows the total numbers of federal government deficits and in this chart you can see how the Democrats went absolutely crazy and I mean absolutely ballistic crazy on spending as soon as they took control of Congress in 2007. The liberal progressive Democrats grew the federal debt by $900 billion the first year they had control of Congress. It is my conclusion that all this was intentional to bring the country to the point of economic collapse and that’s why you need to buy my book and find out what I have observed from the liberal, progressive Democratic Party for over 30 years. This isn’t something I read in a book this is something I experienced in my life as a person who is self-employed and employer since 1978. I didn’t get this from Glenn Beck he was still a teenager when I was experiencing all this stuff as a business owner Glenn Beck was still in school. But Glenn is 100% corect in everything he says about the economy. I think he read my book 2012.

Go look at the chart I made which is a summary made from the prior webpage given or the Congressional budget office numbers. By 1980 when Jimmy Carter was president and the Democrats had control both houses and the Senate and at that time I had already made conclusion that democrats wanted to destroy the country economically and that was 30 years ago. These people have not changed their goal as it is the same now as it was then. They may be different people but I believe they have the same goal as the Democrats that were in office back then in 1980. Jimmy Carter was president from 1977 to 1981 with a democratically controlled Congress they brought this country to its knees. It was as intentional then as it is now from 2007 to 2011. It is just a repeat of history and history always seems to repeat itself.

See my chart here federal deficit spending from 2001 to 2012.

https://jamesgarrett42.wordpress.com/2011/01/18/will-america-survive/

You won’t even be able to paper your walls with the worthless paper money because most of the money only resides on computer hard drives as digital money. This means you can’t even joke about papering your wall with the worthless paper dollars. Maybe you can gather up all the hard drives and make something out of them.

2012 What's really going to happen in 2012

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Fromt cover of 2012 size 128 x 192 small

2012 cover

Representative Steven Cohen, a Tennessee Democrat, accused House Republicans of using the Nazi’s “big lie” strategy to try to discredit the health care law. Cohen accused Republicans of using Adolf Hitler and Joseph Goebbels propaganda Minister as an example of how Republicans were lying about the health care bill. Nothing could be farther from the truth and Steven Cohen proves in his statement that the real liars and the real Nazis are in the democratic party.

Point Number one is Hitler’s political party run by Goebbels was called the national Socialist workers party. You get the part about socialist workers party. The Republicans and what they stand for and what they have done throughout their history looks nothing like Nazi Germany’s Socialist workers party. The Republican Party governs more from the Constitution and the beliefs of our founding fathers more than any other political party other than the Libertarian party. Libertarians are not liberals in the modern sense they believe in the government should only do two things protect the borders and provide an army to protect the country and nothing else. They would be considered extreme right. Libertarians believe in no socialism whatsoever. I think the Libertarian party should change their name to the Constitution party. Libertarians vote for Republicans and never for Democrats. The Democrats have always practiced what looks more like National Socialism and they believe in and practice wealth redistribution policies and this leads to a one class economic system like that of Karl Marx in his Communist manifesto.

The lies and deceit which Joseph Goebbels depended upon to control the German people’s way of thinking and to get them to go along with killing 6 1/2 million Jews and an estimated total of over 13 million people in Hitler’s concentration camps. Do you remember the part of the debate that went like this, we have to pass a bill to know what’s in the bill? If that’s not premeditated deception than what is?

I have watched the Democrats lie about everything they do for the last 34 years. If anything this tactic of Joseph Goebbels deception has been practiced by the Democratic Party consistently for my entire adult life. The tactics of the Democratic Party the liberals and progressives has a direct resemblance of nazi Nationalist Socialist workers party propaganda practices, it’s a perfect match for what the Democratic Party practices. This is not from what I have read in a news paper or a book; this is from what I have observed from their actions and the results of their actions.

The exact words of Joseph Goebbels were the bigger the lie the easier it is to believe. I read about all this when I was a teenager more than 40 years ago. I had a great interest in what happened in the Second World War and how 13 million people were allowed to be murdered in gas chambers and then the bodies were burned. Now what I have observed in over 34 years of watching the liberal, progressive Democrats is that they are the most likely group that would do this sort of heinous thing to people to get what they want. Their actions have proven them to be exactly like the Nazis. The healthcare bill they passed was against the will of the majority of the people. This should be evidence that they believe in dictatorship, that’s what Nazi Germany was and that’s what the Democrats did when they passed the healthcare bill against the will of the majority of the people.

The Democrats practice dictatorships to in their style of governance. That has no resemblance whatsoever to the Republican Party. When the Republicans were in charge of the House and Senate Congress tried to pass an amnesty bill for 20 million illegal aliens. That also included allowing 42 million more extended families of Mexicans to legally come into the country. The people were against it and the Republicans knew it and Republicans did not pass the bill. This was by the will of the majority of the people. There is a dramatic difference between the way the Democrats govern against the will of the people and the Republicans governed by the will of the people. The liberal and progressive Democrats think that the American people are stupid. They found out after just two years of having a supermajority and losing it, that the American people are not stupid and the Democrats are still in denial.

While the Democrats were trying to get the healthcare bill through when they had the supermajority of votes in both the House and the Senate. They couldn’t get the bill passed within their own parties supermajority. They constantly blamed it on the Republicans and they did not need even one Republican vote to pass the bill. This is just more lies and deception, more proof of who the Nazi’s really are. They still to this day blame the Republicans for having such a hard time passing the healthcare bill. Just like the Democratic senator Steven Cohen said the longer you tell the lie sooner or later people will believe it. This tactic is being practiced by the Democrats not by the Republican Party. But what I have seen the Democrats do over the last 34 years is exactly what Steven Cohen is doing by blaming the Republicans for what the Democrats are guilty of. This is what I have observed coming from the Democratic Party. So who are the real Nazis that are practicing the bigger the lie and the longer you tell it the easier it is to believe.

Here is what I have found the new healthcare bill is doing to the American people right now. The truth is not what the Democrats are telling us the truth is they are just lying to the public, but what is actually happening to the people and what I know for a fact is that people with their own paid health insurance coverage and everyone I know has gotten huge premium increases in their healthcare ranging from 12% to as high as 37%. The Democrats told us that it would make insurance cheaper. But 34 years of observation and watching what the Democrats say and the actual results are always much different. This proves again that Democrats are using the tactics of the Nazi party.

The very titles of their bills are a complete deception when compared to what’s actually in these bills. The people who have to pay these higher insurance premiums know who’s telling the truth and who is lying. Another example is the fair credit act passed in early 2009 after the Democrats got super majority control of Congress. This bill is primarily directed at credit cards and pushed the cost of using them up increasing the cost to the taxpayer. While at the same time giving people who don’t pay their bill special rights, projections and privileges. Who pays for this? The people who do pay their bills in the form of higher interest rates and fees. There was nothing fair and the fair credit act for the people who pay their bills. This is what I mean by a deceptive title, the facts are everything that Democrats do seems to be full of deceptions and this is why the Democrats lost control of Congress. 

Now the Republicans have more seats in the House of Representatives than they ever have in our history. Even though the evidence is in and the American people are on to Democrats tactics of deceit and we see the proof by the evidence of the results of the election on November 2, 2010. The Democrats continue to practice Joseph Goebbels tactics of the longer you tell the lie and the bigger the lie the easier it is to believe. But it’s not working for them anymore the American people are on to their lies more so than ever before, because it’s costing them and people vote their wallets.

If you look into what the National Socialist workers party was in Hitler’s Germany and then you look at socialism and modern socialist Europe and then you compare that to Karl Marx communism, you’ll see there’s very little difference in what they all believe and practice. They are all so much alike it’s hard to understand why Hitler hated communism so much, when their beliefs were so close you could not tell them apart. These are all political systems that are also economic systems. They are all a derivative of Karl Marx’s Communist manifesto. The problem I have with any form of socialism or communism is the economics never works out for the people. It’s about the math and you can ask any European how their socialism works for them and how their socialized medicine works, you will get the same answer from all of them, it just doesn’t work. This is exactly the same economic system that the Democratic Party and Barack Obama (B.O.) is trying to force on the American people against their will.

Here are the facts and the numbers to show there’s no common sense or logic in the way that liberal, progressive Democrats think. They put 180 million Americans who are already covered with their own health insurance in a position of having to pay much higher premiums for the year 2010 and 2011 and all years that follow. To provide health insurance for just 6 million people starting in 2014. Where is the logic in that? Nancy Pelosi said we had to pass the bill to find out what’s in the bill and where’s the logic in that?

The liberal, progressive Democratic Party is claiming they’re going to provide insurance for 31 million people, but that’s a lie. What the new healthcare bill is going to do is force an additional 25 million people to purchase health insurance from insurance companies. You have to add the 180 million who already have health care insurance and the additional 25 million that will be forced to pay into the health insurance system just to pay for 6 million people who can’t afford healthcare insurance. The new healthcare bill is just another form of further wealth redistribution. The Democrats have found a way to force 205 million people to pay more money in insurance premiums to cover just 6 million people.

The Democrats have the public believing and they have stated many times (specifically Nancy Pelosi and the liberal fringe lame stream news media) that they’re going to provide health insurance for 31 million Americans. But the facts have shown since they have passed the bill so we could know what was in the bill. The new healthcare bill will force 25 million people to pay into the system and it’s not free. 25 million people are being forced into the health insurance system are going to have to pay for health insurance or pay a fine if they don’t comply inforced by the infamous IRS. More lies and deceit coming from the liberal progressive Democratic Party

This is exactly what all the lawsuits from the states are about; claiming that forcing the people to buy health care insurance or any product is unconstitutional. One court in Virginia has already made a decision that the new healthcare bill is unconstitutional. There are many more lawsuits to be heard and what the states really have a problem with his they’re going to have to pay part of this new healthcare bill and they just don’t have the money to do it.

So once again we have the Democrats who are practicing Adolf Hitler’s tactics of the longer you tell a lie and the bigger lie the easier it is to believe. This looks like it benefits the insurance companies more than it does anyone else. While the Democrats have demonized the insurance companies and are making charges that they make too much money (A 1.6% profit) they turn right around and pass legislation in the healthcare bill that puts 25 million more people into the healthcare system paying premiums to the insurance companies. Another lie told by the Nazi Democratic Party.

Representative Steven Cohen made statements accusing the Republicans of acting like Nazis and he says he will not apologize. I will not apologize for what I have put in these pages and I have no reason to because I am telling the truth and Steven Cohen is practicing propaganda of Adolf Hitler’s Nazi Germany and he’s just flat-out lying to the American people. What I have learned in life is that everything we do matters. There is no such thing as it’s irrelevant, everything is relevant, everything we say and every action we take has consequences. I will finish with this. There is zero resemblance of Nazi practices in the Republican Party, but there is a 100% resemblance of Adolf Hitler and Joseph Goebbels Nazi Germany within the Democratic Party by the lies they tell, in what they say and what they practice. They look exactly like the Nazi party to me and this is from 34 years of observation.

 These are not my opinions these are just the facts and truths.I find it funny how liberals and progressive Democrats will say well that’s your opinion when you are stating facts. This is just another form of deception. liberal,progressive Democrats don’t really have an argument that deals with the truth or the facts. They cannot argue with the facts they can only argue with opinions and views which are not facts. They live and operate in a fantasy land of a psychologically and mentally defective environment completely void of logic and common sense. They seem to act like a trained seal only repeating what they have heard others in their own ilk say.

In Steven Cohen’s rant he cited the cost of health care being $210 billion in the first 10 years. He said that this was done by the congressional budget office. Why is it everything I read says the cost will be $1 trillion over the first 10 years? Is this just more disinformation coming from the liberal progressive Democratic Party practicing their tactics of Adolf Hitler and Joseph Goebbels. Then there’s the other part no one mentions. What about the cost and higher insurance premiums for the first full year of 2011 to the 180 million Americans that will have to pay directly through their higher insurance premiums. I have done the math on this and it works out to be $252 billion just for 2011.

This isn’t in any of the Congressional Budget Office numbers because they don’t know what the insurance companies are going to charge and it’s not something the government will have to pay so it is not their concern. They didn’t know when the bill was being written and they still don’t know. These are my numbers based on the amount of money that is paid from insurance companies each year on health care and using the lowest percentage of increase premium of 12%. The actual cost will probably be much higher than my estimate of $252 billion for 2011. This will show up in the next six months as $21 billion a month is diverted from other sectors of the economy to pay for these higher healthcare insurance premiums. It doesn’t matter whether you pay it or your employer pays for your healthcare all that money still goes missing. No economists have even recognized this yet and perhaps this is because they to think money just falls out of sky or we all have a printing press in our basement,  just like the liberal, progressive Democratic Party seems to think.

2012 What's really going to happen in 2012

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I made this chart to show the out-of-control spending since Democrats took majority control of Congress in January of 2007. Most of the deficit is from out-of-control spending not from a lack of taxes collected. Notice the huge increase in spending from 2007 fiscal year and up to the 2009 fiscal year. These budgets are done by April 15, of each year and they start on October 1 at the end of the year and run up to their name given year like the 2008 started on October 1 2007 and ended September 2008. This 2008 budget was done before the bank collapsed in September of 2008. The April 15, 2009 budget for fiscal year 2010 total amount of federal spending went from $2.7 trillion when the republicans controlled congress in 2006 and went up to $3.7 trillion by April 2009 or the point is, in a 27 month period after the Democrats took control of Congress in the November elections of 2006 they immediately exploded federal government spending by $1 trillion in just two short years.

year Oct.1, to Sept. 30 controlling majority votes Deficitsbillions dollars Gov. Total Spending Total accumulativeDeficit Federal taxCollected.
2001 REP -128.2 1,863.2 5,807.5 1,991
2002 REP 157.8 2,011.2 6,228.2 1,853
2003 REP 377.6 2,160.1 6,783.2 1,782
2004 REP 412.7 2,293.0 7,379.1 1,880
2005 REP 318.3 2,472.2 7,932.7 2,153
2006 REP 248.2 2,655.4 8,507.0 2,406
2007 DEM 160.9 2,728.9 9,007.7 2,568
2008 DEM 458.6* 2,982.6 9,986.1 2,523
2009 DEM 1,412.7* 3,517.7 11,875.9 2,104
2010 DEM 1,555.6* 3,720.7 13,786.6 2,165
2011 DEM 1,645.1* 3,833.9 15,476.2 2,567
2012 REP/DEM 1,242.5 3,754.9 16,335.7 2,926
2013 REP/DEM 1,141.3 3,915.4 17,453.5 3,188
2014 UNKNOWN        
2015 UNKNOWN        

 http://www.usgovernmentspending.com/federal_deficit_chart.html

This has been blamed on the Republicans, but as you can see it’s a spending problem not a tax collection Problem. It was done by the democrats and not due to anything Republicans did and most of this problem was created by expansion in the dollar amounts spent not by the lack of taxes being collected. It is however due to a combination of both a huge drop off of $400 billion in tax collections because of the bank collapse in September of 2008, but as you can also see their $1 trillion in added spending is the real problem giving us the $1.4 trillion 2009 budget deficit

 In the elections of November 2006 when the Republicans lost majority control of the House and the Senate, Democrats ran on a more responsible government more transparency and lower deficit spending. But as you can see from the chart above they did exactly the opposite of what they said they would do. If they had kept additional spending down and not exploded spending we would not have the trillion dollars a year deficits that we now have as far as the eye can see since they did extend the current tax rates. If Democrats had held the line on spending the deficit would have only been $400 Billion not $1.4 trillion. I would also point out here the chart shows a deficit of $828 Billion for 2012 and that number is no longer a valid number. Extending the lower tax rates and adding other pork barrel spending increased the deficit by $450 billion which now brings the total deficit to $1.278 trillion for the 2012 budget year. Like I said trillion-dollar deficits as far as the eye can see.

The liberal progressive Democrats in Congress and liberal progressive lame stream news media were telling the public that the Republicans are spending too much money in the 2006 election cycle. If you take noticed the deficit in the last year that the Republicans control Congress was only $161 billion and the very first year that the Democrats got control of the purse strings democrats pushed that up to $458 billion this was an all time record high. This did not include spending for the wars we are in or other off budget deficit spending. If we add off budget spending the total deficit for 2008 was $979 billion. This was not all from the cost of the 2 wars we were in. This budget was supposed to be voted on by April 15, 2007 four months after they took control of the House and Senate. To clarify this explanation by April 15, 2008 they increase the top line spending an additional $535 billion which brings the total increase in additional on budget spending to $789 billion from April 15, 2007 to April 15, 2008 and only been in office for 16 months. In the same period of time the on and off budget deficit for that same time period was $979 billion very close to $1 trillion in just 16 months.

I would make this charge. This was done on purpose to intentionally explode the deficit to the trillion-dollar amounts that it wound up being. As you can see looking at the numbers and going into early 2009 that $1 trillion was additional spending and the other $400 billion was from because of the bank collapse from September 15, 2008. If was not done intentionally, that would mean it was done by accident and that would mean that Democrats are incompetent. In either case this was an act of incompetence whether they did it by accident or on purpose. If they did it on purpose it is an act of seditious treason. Seditious treason is a law that prohibits trying to destroy or cause damage to the country from within the government or outside the government. In either case democrats didn’t belong in office and given control of all three branches of our government. That should be obvious to any moron by now.

Additionally this does not include the $864 billion stimulus package passed in February of 2009 as you can see it in the $1.9 trillion total accumulative deficit for 2010 which ended September 30, 2010 this is the year where most of the stimulus money was spent as that was an emergency spending off budget Bill that would not be included in the regular deficits reported yearly. This is way past out-of-control spending is just plain nuts.

It took from the creation of the Federal Reserve in 1913 and up to the year 2007 for federal spending to get the $2.7 trillion federal spending amount. That’s 94 years from the creation of the Federal Reserve. Then in just over two years from April 2007 to April 2009 for total federal spending to get to $3.7 trillion and that’s a 37% increase in spending. The situation we face now is that we are borrowing 40% of all the money the federal government is spending. That is what they are telling the public, but the truth is we are printing or digitizing 40% of all the money the federal government is spending. No one is really lending us any money, remember all the banks went broke all at once in 2008 and $60 trillion went missing. So where is all the money coming from? Here’s what I have noticed, China and other countries are running their printing presses and buying our bonds with their phony baloney money so what this really means is their buying our worthless paper with their worthless paper. China for example reduces their bond holdings from $800 billion to $750 billion in 2009 and then increases that amount to $900 billion in 2010 using their phony baloney money.

Let’s correct the disinformation campaign still ongoing from the liberal progressive lame stream news media. With the chart above I would also like to clarify that the news media which reports that the federal deficit as $10 trillion when democrats took office and Obama took office is inaccurate as you can see from the chart above when the Republicans left office at the end of 2006 the total federal deficit was only $9 trillion and the debt ceiling not shown on the chart was $10 trillion. You can see by the end of this year the total public deficit has gone from $9 trillion when the republicans lost control of congress in 2007 and now its up to the current $15.1 trillion in just four short years. What did the Democrats do with $6.1 trillion in just four years they had controll of congress? It took more then 94 years to get to $9 trillion in total public debt and the democrate increased it to $15.1 trillion in just 4 years.

I would also like to point out that from the creation of the Fed 1913 and up to 2009 the inflation rate is 1900%. In the following years we will see something similar as we are getting close to doubling the debt in just a five-year period. To figure out how this will affect you figure a small portion of that 1900% and let’s say using a much smaller number of a 300% inflation rate. What that means for you is you just multiply everything times three. 3 times your grocery bills, three times what you spend per week in gasoline and pretty much everything else. Of course the number is ridiculous and you would not be able to afford to live, nobody could and that’s exactly what I think is going to happen. However this would affect you is how it would affect the rest of the country. We have to multiply that by the other 300 million people in the country and it will affect them in the same negative way. Then we get the big picture of how this will affect the economy nationally. I believe the point of an economic collapse is much lower than 300%.

I would say the magic number is somewhere below a 100% inflation rate or just something less than a doubling of prices would collapse the economy. The inflation rate will never get to 100% before the economy collapses. A doubling of prices means production only needs to be half of what it is today and that means more or less, half the people in the country would suddenly find themselves out of work or going to work with nothing to do. That means somewhere in the neighborhood of 75 million people would be unemployed. The official number of unemployed right now is around 15 million people as of January 7, 2011. That’s the way the math works out. You know as I do that the economy would collapse way before it ever got to 75 million unemployed.

I hear the talking heads say that we’re going to live in a banana republic, but I believe will be much worse than that. I have done the math and it just doesn’t work out to be a banana republic. The math works out that the economy will totally collapse and the currency. This will happen at somewhere between 50 and 70% inflation if it happens over a two-year period. This is due to there is only so much money in the system. As the things we need to buy each week like food and gasoline increase in price this takes hundreds of billions of dollars from other discretionary spending. As these dollars literally disappear into the thin air they come out of, other sectors of the economy will shrink in the same number of dollars we spend additionally on food and gasoline. There is only so much money in the economy at any given time. An example would be if food and gasoline doubles in price where will you get the additional money from. This will affect 80% of the working public the same way and they will stop spending on other items and the economy will take a nose dive and retail sales will plummet.

Food and gasoline are the two most important items necessary to live in our modern society. If Congress passes legislation to keep the oil companies from drilling where we know there is crude oil. These policies will eventually create shortages and shortages force up the price of any commodity. This is what the Democratic Party has done since the creation of the Department of Energy. The Department of Energy was created to reduce the dependency on foreign oil, but what it has done in reality is the opposite. This seems to be the norm for government as they tell us that something is good for us but it turns out to be the opposite of what they claim it is, just like the Department of Energy. Since the creation of the Department of Energy we have gone from 30% Dependency on foreign oil to 72% dependent on foreign oil.

When something happens to our currency and it will, the value or buying power of the dollar drops radically from this devaluation and our trading partners around the world require more of our phony baloney money to purchase crude oil. It does not matter where the crude oil will come from Canada, Mexico, Venezuela or the Middle East the currency devaluation will have the same effect friend or foe. This will force up the price of everything including food which is directly attached to the cost of crude oil. It seems to me that no one has bothered to do the math. I will do an article to show that the equivalent of one dollar increase for 1 gallon of gasoline is equivalent to $30 billion each month and that’s $360 billion a year that just disappears from other sectors of the economy. This does not count the additional money that food would go up but I do remember spikes in food prices when gasoline was four dollars a gallon and in just one month food prices went up 5% and that is a 60% yearly average food increase from inflation.

You know what happens to food after we eat it, we would like to think it disappears and it does. Just like we burn gasoline and it disappears the same goes with food and it disappears. The additional money from high inflation spent on these two commodities in fact does disappear. We are not buying more product we are spending more buying the same quantity of product. I’ll say it again that as this money is spent on food and gas for every dollar we spend on those items additionally the rest of the economy will shrink by the same dollar amounts. The gross domestic product number will be reported as increasing because we are spending more and everything will look good like the economy is growing and the talking heads will be scratching their heads wondering why retail sales and other sectors of the economy are shrinking. They will be telling us that it’s a jobless recovery; I believe there is no such thing as jobless recovery. They just don’t know how to do the math to figure out why the economy is not actually creating any jobs. They’re really not that smart people we would like to think they are. That’s why we call them the talking heads because they talk and all you see is their heads and they’re not really saying anything.

Here are a few notes in the chart above that the news media is not reporting and they are very important. The 2011 deficit being reported currently is no longer a valid number. The $1,266.7 trillion for 2011 will increase by $450 billion each year for 2011 and 2012. Because of the extension of the bush tax rates adding $900 billion total for 2011 and 2012 budget years. The new yearly deficit for 2011 would be $1.716.7 trillion and the total public goes up from $15,144.0 trillion to $15,590 Trillion for 2011. No one has bothered to do the simple math yet and you can see it in the chart above and the expected tax collections for the year 2011 shows tax collections increase by about $300 billion shown in the chart for the year 2011. This shows the simple math that the lame stream liberal progressive news media seems to be incapable of doing. The deficit Winds up being a $1.7 trillion deficit in the fiscal year 2011. This also brings the total accumulated deficit held by the public to $15.5 trillion and this exceeds current gross domestic product by $700 billion. By the middle of 2011 around July or August or in just six months. Our debt will be more than 100% of our total gross domestic product projected to be $15,299 trillion for 2011. It is at this point  when the national debt exceeds gross domestic product we’re all foreign debt holders of US treasury bonds could panic and start to bail out. If they do start to dump US treasuries then interest rates on home mortgages would skyrocket. This could cause a second big bank collapse way worse than in 2008.

Next we have the debt ceiling as it will be reached in just 3 months and has to be increased by congress by April 15 2011 and if the debt ceiling is not raised the Federal Reserve can no longer print money or digitized or barrow any more through the sale of debt bonds. The federal government will be short over $1.6 trillion to pay out entitlements and other operating cost. What do you think the American people would do if all the sudden all there entitlement programs were cut by one-third? For that matter what will government workers do if they are all sent home for three or four months. If there is a big fight in Congress over raising the debt ceiling and it goes on for several weeks. The indecision or the prolonged fight could cause panic in the stock markets and bond markets around the world. This is just around the corner and it will be interesting to see the outcome.

 Because the way the government uses the calendar fiscal year the total deficit they report for the year 2011 may show up to be less than $1.7 trillion. There is a reason governments do things the way they do. What I have seen for more than 30 years is they change the rules of their bookkeeping to hide what is really going on from the public. Off budget deficit spending is an example of how they get away without reporting the true total deficit to the public. It all has to do with tricks of the calendar and constantly change the rules of how they keep their books. Here’s an example: I used to work six days straight 12 hours a day on the docks in Baltimore. Because of the way they ran their schedule I never got more than 12 hours of overtime. It was six days on three days off and it would change every shift from day shift to-night shift. The pay period ended on Wednesday in the middle of each week. But the bottom line was I never got more than 12 hours of overtime when I should-be been getting 32 hours a week of overtime for working six days straight 12 hours a day or 72 hours. This was a union job to, so much for that. It was all a trick in the calendar; they always split the shifts so they would always work out to their advantage so they would not have to pay the 32 hours of overtime. The government makes up its rules in the same fashion and uses different calendar years than the rest of us do. This is meant to hide things and confuse people. Just like the date April 15, 2007 is the deadline for the 2008 budget which starts October 1, 2007 runs to September 30, 2008. This gives cover for the politicians and keeps people confused.

The latest change that the federal government has made comes from Department of Labor and statistics in the most recent report they have stated that they are going to start to include the self-employed as being employed. This will add hundreds of thousands to the number of people who are employed and it will make unemployment look like it’s improving even though there’s been no real change in the number of people with jobs. There is a distinct difference between people who are self-employed and people who are employed. Self-employed people are business owners and are not employed by employers. They are in fact employers of people not employees. But this is what I mean by how government changes the rules when it benefits them politically. So you can expect to see unemployment numbers looking better but the real situation will remain the same. (You can hide the truth but the truth is still there.) It does show up in their last report as it is stated they are going to include the self-employed. I followed these numbers month over month and the total number of employed in the body of the report did go up 700,000 between December 3, 2010 report in the January 7, 2011 unemployment report revised for the year 2010. It was not reported in the headline number however. So there they go again changing the rules so the politicians look good even when things are continue to be really bad. Prior to that January 7, 2011 report total number of people employed had only gone up 507,000 from November of 2009 to November of 2010. This is also something I haven’t heard the lame stream news media report on this and if they have, I must have missed it. The lame stream news media seems to make a big deal out of things that really don’t matter as they drone on for weeks on matters of no importance and completely ignore the things that really do matter to everybody.

 *On the chart for the year 2001 -128.2 is a surplus not a deficit. That’s kind of backward as the negative is actually a positive and a deficit which is actually the negative is considered a positive. Wow that even confuses me just a little.

 

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Do not be disappointed that we lost control of the House or Representatives we still control the Senate and the White House. The Republican wing nuts will not be able to change anything are liberal and progressive leaders have done to change the country in the last four years. But get ready for what comes next everything is going as planned but we would like to get you prepared for what comes in the next two years. 

The final solution was to destroy capitalism as we will be successful in short order with these $1.3 trillion to $1.5 trillion deficit spending it will not be long now before the system collapses. We have worked long and hard to achieve this goal and after more than 100 years the time is at hand, so you need to be prepared for the collapse of the capitalist system and the aftermath of our success. 

We want all our progressive and liberal friends to be ready for what happens next. Take special note that this will happen very soon. You will start to see the severe devaluation of the currency within the next six months. You can see it now in the cost of the gasoline at the pumps and the higher price food at the grocery store and we expect this to get much worse. This is just part of our plan that is currently unfolding. We have already been successful in overloading the government with social programs and growing the cost of government to the point of collapse, it is only a matter of time now. So we want you to be ready for what is going to happen next.

We are on a short timeline and expecting a severe devaluation in the dollar and this will come in the next 18 months. There’s not much time left to prepare for this so you must heed this warning and take action as soon as possible. Gasoline will soon go to five dollars a gallon probably by the end of the year 2011. Due to severe devaluation of our currency and due to the high cost of gasoline we will use a lot less of it and we won’t pollute the air as much. Very soon after the gasoline goes to five dollars a gallon it will probably go up to eight dollars a gallon sometime in early 2012. Once this happens the economy will certainly collapse and the capitalist system will no longer exist. After 100 years we will finally get what we want, so what comes next?

With the success of the collapse of the capitalist system, there will be riots and the distribution system will also fail completely. There will be no food in the grocery stores of any kind anywhere the United States. So you need to stock up on lots of canned foods, it will take years to get some kind of normalcy back into the new socialist Democratic system. We are planning to rebuild and go green; the new economy will be under a new progressive, socialist economic system and will be environmentally friendly. 

Under the new system there will be no middle class everyone will be the same class so there will finally be equality and there will be no rich people and no middle class. We will change to a one class system where everything is fair and equal. With the collapse of the capitalist system this will make the dollar totally worthless, this means we will all be on the same page and flat busted broke. So we recommend you buy some gold or silver because our paper money will be totally worthless. There will be no state governments as they will collapse right along with the federal government because they use the same paper money made up out of thin air by the federal government. This means we will be able to take total control of all the governments in the country at the same time. This also means there will be no local police protection so you must prepare to defend yourself until we can establish a new police force. 

With the collapse of all governments and the capitalist system we need you to prepare for the following list of everything that will no longer exist. These services will not exist anymore once we achieve success in collapsing the capitalist system. There will be no banks, No grocery stores, No food any were to be found in or around the cities. No jobs, 308 million people will be out of work with no jobs anywhere to be found, remember our goal was to collapse the system. No food stamps and no food, No wealth to redistribute and there will be no welfare checks or social security. No Medicare, No Medicaid and no hospitals.

This will go on for many years and once it’s gone. There will not be any distribution system at all, it disappeared with the collapsed value of the dollar. This also leads to No electricity, No water, each collapsed system reinforces the collapse of the others as each system mentioned above keeps the others running in some way, so get prepared for this. It will take a very long time to start-up again once the distribution system stops. This also means no gasoline and no cars. The haves and the have not’s will be the ones who have the guns and the ones that don’t. If your one of those people who doesn’t believe in owning a gun, get a base-ball bat to protect yourself because everyone will want to kill you for the food they think you may have even if you don’t head this warning. We estimate based on history that with destabilization of the economic system we expect this condition will go on for at least 7 years. This will not be over within a few weeks. So I wish all my liberal and progressive democratic friends good luck and may god be with you even if you don’t believe there is one.

2012 What's really going to happen in 2012

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