August 30 2015 rev1
“Silence in the face of evil is itself evil. God will not hold us guiltless. Not to speak, is to speak. Not to act, is to act”. Dietrich Bonhoeffer
“And I sincerely believe, with you, that banking establishments are more dangerous than standing armies; and that the principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale.” Thomas Jefferson, Letter to John Taylor, May 26, 1816
Insolvent Banks are Likely to Confiscate Wealth – Background
This is a summary article of work previously published on “Bail Ins” and “Currency Wars” and it adds the new government proposal of “Taxation of Private Savings” in the subject focus. The full article can be found on my educational site where it more deeply discusses the political and economic environment associated with investment. This is a clarification of a very complex subject. I believe that the reader will find a great deal of content here. I have tried to make it accurate and I documented the principle sources of the material. Thus, I tried to make it-documented fact, not just opinion.
My blog is www.joehawranek.com and the in-depth article is downloadable from Here. The article discusses what I consider the additional government “desperation move” of a Flat Tax on Private savings. The discussion has started in Europe for a “10 % Tax” on savings. Since, liberty and private property are inseparable; we will lose some liberty when the “Bail Ins” or this “Tax” occurs. You cannot lose property without losing liberty. The banks and the government are currently set up to take private property from the nation’s citizens and when they do, some portion of our liberty will disappear.
Besides analyzing five previously published articles on “Bail Ins” and the “Currency Wars”, the article analyzes the recent government phenomenon of a proposed tax on savings deposits. The articles show that it is reasonably probable that both government taxation of deposits and bank Bail Ins will occur simply because many major nations, including the US, are technically insolvent as are most large banks. The government and the banks need our assets and are willing to take them by whatever means they can. This is typical of a fascist government where the political leaders will do or say anything for the individuals in power to remain in power.
Bob Chapman (deceased) of the International Forecaster held that the US went into a depression in 1Q08. I agree. It appears to me and others that the government and market statistics are being manipulated to create an illusion of prosperity but that illusion with QE to infinity is making the financial bubble larger. When it pops, the fall will be farther. To illustrate these assertions, this article discusses some major factors affecting GDP such as unemployment, retail sales, housing, inflation and the nation’s debt.
Our nation’s debt is currently growing by $2.2 trillion per year. This article examines the four possible ways for the government to handle this debt and shows why the government’s chosen path of Quantitative Easing just helps the banks and not the citizens because it was designed that way. The government debt could be zeroed by a “Tax on private savings” such as being proposed in Europe. However, the proposed European 10% rate would have to be increased to 30% to cover our debt. When one combines that amount with “Bail Ins” that have an average “take” of 75% of the deposits over $100K , one wonders, “How much will be left”? A sobering thought is that the powers in office may choose either a “tax” or a “bail in” or both. The five articles mentioned are listed below.
Bank Bail Ins
(1) Article 1: The G-20 Stability Board – Strategic Plan (Cyprus, MF Global and the New World Order). You can view it here.
This is where the terms “Bail In” and “G-SIFI” that replaces “Too Big to Fail” were born. It gives directions as to how a “Bail In” is to be implemented.
(2) Article 2: Bail Ins – How They Will Affect You – Part I: The Setup
G20 Strategy for Global Financial Collapse, US Supporting Law, “Too Big To Fail”, and G-SIFI. You can view it here.
All stings have set ups where they get the “Marks” – this is you – into believing that everything is alright and you are about to make some money. here
(3) Article 3:Bail Ins – How They Will Affect You – Part II: The Sting
Popping the Bubble, Derivatives, Bail Ins, Social Unrest, Alternatives and Likely Outcome. You can view it here.
The “Sting” is where the “Marks”- you in this instance – lose their money.
The Currency Wars
(4) Article 4: THE CURRENCY WAR AND WHAT IT MEANS TO YOU, Part I. You can view it here.
The world currency refers to the currency that most transactions use. The Dollar has been that currency since the end of WWII. Today it is used in about 80% of the global transactions. The Yuan is number two at about 8%.
(5) Article 5: THE CURRENCY WAR AND WHAT IT MEANS TO YOU – Part 2. You can view it here.
China wants the Yuan number one and has done a lot to make this event happen. They have gold and currency exchanges in competition with COMEX and the London Exchange; bi-lateral agreements with 23 nations to accept Yuan rather than dollars; accumulated about 30,000 tons of gold to back their Yuan; have $1.2 trillion of Treasuries that if sold would collapse the US financial system; have “triggers” in place to announce the gold backed Yuan.
It is likely that the government in cooperation with banks will enable “Bail Ins” to occur. The five articles discuss the source of the term “Bail Ins”; the G-20 Stability Board plan; the Setup including repeal of Glass Steagall, enactments of Dodd Frank and the Graham, Leach, Bliley Laws; the Sting including the popping of the derivative bubble, Bail Ins, the unrest that will probably follow and suggested alternatives.
The articles on the Currency Wars address the government’s active solution in the use of Quantitative Easing as being in error. I believe that the government has made an erroneous assumption about the continuity of the Federal Reserve note. All fiat currencies fail. This FED reserve note is a fiat currency that the world is preparing to abandon. Why? They no longer trust our US government. Meanwhile, the Chinese are in the wings and want their Yuan as the international currency. The proof of this strong statement is that the FED is monetizing the debt by buying about 80% of the Treasury refinances because no one else wants the FED treasury bonds. The government would love to seize private savings and replace it with these bonds that no one wants. The Chinese also want their $1.2 trillion Treasury loan back. My research in the above articles shows that they have acquired about 30,000 tons of gold to back their currency. Today, the Yuan is already the number two currency in the world. When China announces a gold backed Yuan, the day of the FED fiat dollar will end. That day will mark the day when the world of the citizens of the US will change dramatically for the worse.
What the Small to Medium Investor Should Consider
If it appears as if the market is a “crooked card game”, it is wise to pack up and play elsewhere. For instance, the earnings just reported for stock exchange companies are the worst since records have been kept. However, the market has just advanced in an uptrend that is phenomenal. One for instance is that IBM has reported reduced sales for the last five quarters but also showed increased earnings for those quarters. This makes no sense and people are leaving since they no longer trust the numbers. Thus, I believe that trust in the market is eroding. Trust in the US government is also eroding. Investors are bailing out of Treasuries and going into corporate bonds as evidenced by the 10-year bond rate doubling to 2.8% in one year. If this continues, this action alone will “pop” the derivative bubble. Employment is shaky in many industries as earnings and sales decline. Real unemployment is currently at 23.5% and climbing. It reached 28% at the bottom of the 30s depression.
Certain large corporations are safe but many banks may fail. During the big Depression, 44% of the banks failed. In 1929, there were 16,131 banks but by 1934, there were only 9,077. Most of these banks were state banks that were not part of the FED system. They were not allowed to get “loans” from the central bank. In this way, the big 5 FED banks picked up assets. It appears to be happening again. The worst has yet to hit current banking. Since 2007, there have been only 499 failures or mergers. Today there are 6,089 banks in existence. A 44% failure from 2007 level would be about 2,900 banks. This means that another 2,000 banks could fail. Only the G-SIFI banks would remain after this size of “bloodbath”. Possibly this is what is planned in the “bail ins”.
Small businesses are being hurt because it will be difficult to get loans in the upcoming environment. Obamacare is also hurting the small businesses.
With all this gloom, the world will continue but in a modified way. On the other hand, positive things are happening as evidenced by the internet growing. It is growing since selling products and services are rapidly moving to the web – it is lower cost than “brick and mortar” stores and it has a broader audience that is being reached by affiliate marketers. One can find just about anything there and investigate it and its alternatives before purchase. For these reasons, it continues its amazing growth. It serves a need of being a low cost and convenient alternative to the “big stores” and big “service” organizations. It is continuing to grow and rapidly for these reasons.
At times like these, one should at least consider going into business for oneself and becoming an internet affiliate marketer. This new world has materialized in the last ten years. It is one where the individual is again being empowered. It is expected that it will be in the multiple billions in sales by 2020. This is ground floor and the rules are being made and changed every day.
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Financial independence provided by your own business with low overhead and your own efforts is your best insurance in these unstable times. It can be done part time or full time. Affiliate marketing does require work from your home and resources for advertising, tools such as a computer and promotion but you can grow into advertising and multiple product lines gradually. If you are interested, you will find a sign up form for Vertical Rising adjacent to this article.