Sandy Creek 42, LaGrange 7

Setting the stage for a huge showdown next week, the Sandy Creek Patriots struck early and often against LaGrange, cruising to a 42-7 win over the Grangers on Senior Night in Tyrone.

Ranked first in the state in AAAA, the Patriots (7-0-1, 5-0) travel to Carrollton next Friday to face the second-ranked Trojans, who are coming off a 63-21 dismantling of Alexander.

Sandy Creek amassed 322 yards of offense in the first half on the way to a 35-0 lead at intermission. The entire second half was played using a running clock.

read more

via The Citizen http://www.thecitizen.com/articles/10-25-2013/sandy-creek-42-lagrange-7

Guest Post: The Fed Can Only Fail

Submitted by Chris Martenson of Peak Prosperity,

The basic predicament we are in is that the current crop of leaders in the halls of monetary and political power do not appear to understand the dimensions of our situation.

The mind-boggling part about all this is that it's not really all that hard to grasp.

Our collective predicament is simply this: Nothing can grow forever.

Sooner or later everything must cease growing or it will exhaust its environs and thereby destroy itself.  The Fed is busy doing everything in its considerable power to get credit (that is, debt) growing again so that we can get back to what they consider to be "normal."

But the problem is — or the predicament I should more accurately say — is that the recent past was not normal.  You've probably all seen this next chart.  It shows total debt in the U.S. as a percent of GDP:


(source)

Somewhere right around 1980, things really changed and debt began climbing far faster than GDP. And that, right there, is the long and the short of why any attempt to continue the behavior that got us to this point is certain to fail.

It is simply not possible to grow your debts faster than your income forever. However, that's been the practice since 1980; and every current politician and Federal Reserve official developed their opinions about 'how the world works' during the 33 year period between 1980 and 2013.

Put bluntly, they want to get us back on that same track and as soon as possible. The reason?  Because every major power center, be that in DC or Wall Street, tuned their thinking, systems and sense of entitlement during that period. And, frankly, a huge number of financial firms and political careers will melt away if/when that credit expansion finally stops.

And stop it will; that's just a mathematical certainty. It's now extremely doubtful that the Fed or DC will willingly cease the current Herculean efforts towards reviving this flawed practice of borrowing too much, too fast. So we have to expect that it will be some form of financial accident that finally breaks the stranglehold of failed thinking that infects current leadership.

The Math

As a thought experiment, let's explore the math a little bit to see where it leads us. After all, I did just say that a poor end to all this is a "mathematical certainty", so let's test that theory a bit. I think you'll find this both interesting and useful.

To begin, Total Credit Market Debt (TCMD) is a measure of all the various forms of debt in the U.S. That includes corporate, state, federal, and household borrowing.  So student loans are in there, as are auto loans, mortgages, municipal and federal debt. It's pretty much everything debt-related.

What it does not include, though, are any unfunded obligations, entitlements, or other types of liabilities. So the Social Security shortfalls are not in there, nor are the underfunded pensions at the state or corporate levels. TCMD is just debt, plain and simple.

As you can see in this next chart, since 1970 TCMD has been growing exponentially and almost perfectly, too (the R^2 is over 0.99 for you science types):

I've pointed out the tiny little wiggle that happened in 2008 – 2009 which apparently nearly brought down the entire global financial system.  That little deviation was practically too much all on its own. 

Now debts are climbing again, at a quite nice pace. That's mainly due to the Fed monetizing US federal debt just to keep things patched together.

As an aside, based on this chart, we'd expect the Fed not to end their QE efforts until and unless households and corporations once more engage in robust borrowing. The system apparently 'needs' this chart to keep growing exponentially or it risks collapse.

Okay, one could ask: Why can't credit just keep growing? 

Here's where things get a little wonky. But if you'll bear with me, you'll see why I'm nearly 100% certain that the future will not resemble the past.

Let's start in 1980 when credit growth really took off. This period also happens to be the happy time that the Fed is trying to (desperately) recreate.

Between 1980 and 2013 total credit grew by an astonishing 8% per year, compounded.  I say 'astonishing' because anything growing by 8% per year will fully double every 9 years.

So let's run the math experiment as ask what will happen if the Fed is successful and total credit grows for the next 30 years at exactly the same rate it did over the prior 30.  That's all. Nothing fancy, simply the same rate of growth that everybody got accustomed to while they were figuring out 'how the world works.'

What happens to the current $57 trillion in TCMD as it advance it by 8% per year for 30 years?  It mushrooms into a silly number: $573 trillion.  That is, an 8% growth paradigm gives us a tenfold increase in total credit in just thirty years:  

For perspective, the GDP of the entire globe was just $85 trillion in 2012.   Even if we advance global GDP by some hefty number, like 4% per year for the next 30 years, under an 8% growth regime U.S. credit would be twice as large as global GDP in 2043(!)

If that comparison didn't do it for you, then just ask yourself: What exactly would US corporation, households and government borrow more than $500 trillion for over the next 30 years? The total mortgage market is currently $10 trillion, so might the plan include developing an additional 50 more US residential real estate markets?

More seriously, can you think of anything that could support borrowing that much money? I can't.

So perhaps the situation moderates a bit and instead of growing at 8%, credit market debt grows at just half that rate. So what happens if credit just grows by 4% per year? 

That gets us to $185 trillion, or another $128 trillion higher than today — a more than 3x increase:

Again, What might we borrow (only) $128 trillion for over the next 30 years? 

When I run these numbers I am entirely confident that the rate of growth in debt between 1980 and 2013 will not be recreated between 2013 and 2043. With just one caveat: I've been assuming dollars remain valuable. If dollars were to lose 90% or more of their value (say, perhaps due to our central bank creating too many of them?), then it's entirely possible to achieve any sorts of fantastical numbers one wishes to see.

Think it could never happen?

Conclusion (to Part I)

This is the critical takeaway from all the math above: for the Fed to achieve anything even close to the historical rate of credit growth, the dollar will have to lose a lot of value.  I truly believe this is the Fed's grand plan, if we may call it that, and it has nothing to do with what's best for the p
eople of this land. Instead, it's entirely about keeping the financial system primed with sufficient new credit to prevent it from imploding.

That is, the Fed is beholden to a broken system; not anything noble.

In Part II: The Near Future May See One of The Biggest Wealth Transfers In Human History, we dive fully into the logic why GDP growth is very unlikely to support the rate of credit expansion the Federal Reserve wants (more accurately: needs). And what will happen if it indeed doesn't? A lot of painful, awful things — but central among them, a currency crisis.

Amidst the ensuing unpleasantness will be an awakening within today's hyper-financialized markets to the huge imbalance now existing between paper claims and ownership of real things. A massive wealth transfer from those with 'paper wealth' (stocks, bonds, dollars) to those owning tangible assets (the productive value of which can't easily be inflated away) will occur — and quickly, too.

Suggesting the key objective for today's investor is answering: How do I make sure I'm on the right side of that wealth transfer?

Click here to access Part II of this report (free executive summary; enrollment required for full access).


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/KWWghjMKRhA/story01.htm Tyler Durden

Sugar: Sweet With A Bitter "Economic" Aftertaste

Sugar may be sweet, but excess consumption leaves a bitter aftertaste: millions of people worldwide are affected by type II diabetes or obesity, costing the global healthcare system billions of dollars every year. As the Credit Suisse Research Institute’s 2013 study “Sugar: Consumption at a Crossroad” found, close to 90% of general practitioners in the US, Europe and Asia believe excess sugar consumption is linked to the sharp growth in these health problems.

 

The mini-documentary

 

Full research article below:

CS Sugar


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/CTnDglo3IxU/story01.htm Tyler Durden

Sugar: Sweet With A Bitter “Economic” Aftertaste

Sugar may be sweet, but excess consumption leaves a bitter aftertaste: millions of people worldwide are affected by type II diabetes or obesity, costing the global healthcare system billions of dollars every year. As the Credit Suisse Research Institute’s 2013 study “Sugar: Consumption at a Crossroad” found, close to 90% of general practitioners in the US, Europe and Asia believe excess sugar consumption is linked to the sharp growth in these health problems.

 

The mini-documentary

 

Full research article below:

CS Sugar


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/CTnDglo3IxU/story01.htm Tyler Durden

An Open Letter To Russell Brand

Russell Brand's excited exchange with stoic Brit Jeremy Paxman this week is a must-see "exchange of new ideas vs old." Among Brand's clearer moments were "stop voting, stop pretending, wake up. Be in reality now, time to be in reality now. Why vote, we know it's not going to make any difference, we know that already." The excellent discourse has prompted this open letter supporting the comedian.. concluding so legitimately nowadays, with Upton Sinclair's infamous quote "It is difficult to get a man to understand something, when his salary depends upon his not understanding it."

 

The original interview (grab a beer and watch – you'll be surprised):

 

CoinAxis blog's Open Letter to Russell Brand:

Dear Russell:

I just finished watching your interview with Jeremy Paxman, aside from Mr. Paxman being a trite individual, it was fantastic exchange of new ideas vs. old.  I'm sure you were expecting Sinead O'Conner, or Miley Cyrus to write you this open-air missive.  Alas, I'm going to underwhelm you, because my fame and fortune are nonexistent.  So, here it is, you get me, Michael, writing you in hopes to get your attention to some important issues, in which are pertinent to your revolutionary interview.

As you summarized in your interview, people that have any sense, realize that voting changes nothing. Voting is an occupation for the disillusioned, the elderly, and hopeful tyrants.  We all know that voting for a new master every four years, still doesn't make you free.  Even still, the capacity to vote on people's fundamental human rights is the antithesis of freedom.  Yet, this is the paradigm we live under, and are born into.  In the United States there are approximately 240,000,000 people who are of voting age.  In the 2012 elections, the total votes cast was approximately 130,000,000.  That's a deficit of 110,000,000 people.  It ends up around 65,000,000 people elect a supposed "leader" for the remaining 310,000,000.  Of those voting, only a small percentage actually know what & how the government works.  Although, they parrot the talking points like good citizens, as their smug partisan destroy lives.

In 2012 the FEC stated that $7 billion dollars was spent on the elections, with the large banking institutions leading the charge.  Most of it was spent on marketing.  Controlling the narrative in the media, and greasing the hands of the well connected. It's a revolving door of political incest, and none of them care about anything other than the status quo. Free indeed.

Stop voting, stop pretending, wake up. Be in reality now, time to be in reality now.  Why vote, we know it's not going to make any difference, we know that already. ~ Russell Brand

If the oligarchy can payout 7 billion in an election cycle, then the only chance the average person has, is to do guerilla marketing.  What does that mean?  It means writing open letters to the people that have a voice in media (you see what I did there?).  It means introducing new ideas to your community, and making changes from the ground up.  You know, I found it so enlightening to see someone in your position in the media, that would take such a stance against voting (and the system).  I'm sure in people's heart of hearts, they are in agreement with you. I'd like to see more of this from you, except next time, turn it up a notch or twelve.  

So why am I writing you?  There is a unique opportunity for you assist in championing the cause for BITCOIN.  You have a good sense of what's right and what's wrong, and you have a humorous meld of eloquence in your delivery.  I don't have to necessarily say it, but you're good at what you do.  However, in my opinion, you're missing the mark on where the systemic problems really lie.  Sure politicians, and corporations collude to extract every bit of resource & money out of the wold populace; however, you've missed the fundamental question.  "Where does they money come from?" 

You may know that the world operates on a debt-based monetary system, with the US dollar used as the reserve currency.  Imagine a couple of seedy characters in a dark basement of the Federal Reserve Bank, printing money at will.  Although, it's not in a dark basement, it's a huge marble & granite edifice, and the printing are merely keystrokes on a computer.  The characters are the large banks.  They create the monetary bubble, they profit from it, then they burst the bubble, and they profit from it, while consolidating the wealth & assets in their coffers. A few decades of this, they have a destroyed monetary system with endless bubbles, dollar devaluation, corporate bailouts, government corruption.  It's all about the money.

apathy doesn't come from us, the people.  The apathy comes from the politicians, they are apathetic to our needs, they're only interested in servicing the needs of corporations. ~ Russell Brand

The system of banking & government largesse can only exist inside this debt-based currency system.  Don't forget fractional reserve banking, and financial derivatives market, in which there are $1.2 Quadrillion dollars worth.  The only way this system can sustain itself, is to increase the debt, which increases the money flowing into the banks & corporations.  Not money flowing into corporations from valid product sales & services, but through the stock market.  Blowing up financial bubble after financial bubble.  Every bubble that bursts consolidates wealth more. The bubbles are fueled by the FED.  

Back to bitcoin.  If you don't know what it is, I'd be happy to be your personal bitcoin consultant.  Bitcoin is a digital currency that is decentralized, and not controllable by any central government, or organization.  It's a payment system and money rolled into one.  It can't be inflated into oblivion, it can cross boarders easily, and can be used globally.  It's gold 2.0, it's the kryptonite of the banking system and errant governments.  And when the shit hits the fan (like Cyprus), and they come looking for turnips to squeeze, they'll be out of luck.  It's truly the people's currency.  It's the honey badger of money.

Here's what I ask of you:

  1. If you don't know about bitcoin, learn about it (the Consultancy offer still stands, you can contact me on this site)
  2. If you don't own bitcoin, buy some.
  3. Promote promote promote bitcoin, it's the catalyst for change.
  4. Use bitcoin, sell your comedy specials for bitcoin, convince your colleagues to use bitcoin.
  5. Promote it some more, help make it a cause.

I say when there is a genuine alternative, a genuine option, then vote for that.  ~ Russell Brand

Here is your genuine alternative, and you don't have to wait until November 5th to vote for it.  You spoke with great certainty of the revolution that is coming.  As a non-violent, and peaceful person, the notion of a revolution tends to make me envision the abhorrent violence that
usually is associated with revolution.  The information revolution is well on it's way, and now it's time to create a peaceful bitcoin revolution, and vote with our bitcoins!  I'm going to leave you with a quote that is not yours; however, it drives the point home on how much work is left to be done.

It is difficult to get a man to understand something, when his salary depends upon his not understanding it.  ~ Upton Sinclair

Best Regards,

Michael


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/nBfH6tATaYk/story01.htm Tyler Durden

Crime Is Getting Worse: Violent Crime In America Increased By 15% Last Year

Submitted by Michael Snyder of The Economic Collapse blog,

If your neighborhood is not as safe as it used to be, then you have something in common with the rest of the country.  All over America, crime is on the rise.  According to a government survey that was just released, violent crime in the United States increased by 15 percent last year, and property crime was up by 12 percent.  If violent crime keeps increasing at this rate, it will approximately double in just six years.  But as I wrote about the other day, when the next major economic downturn strikes it will probably greatly accelerate the growth of the crime rate in this country.  Desperate people do desperate things, and as you will read about below, there are people out there that are already stealing entire truckloads of food. 

In the future, when people are extremely hungry or crazy for their next drug hit, they won't think twice about invading your home or pulling you out of your vehicle.  The rise in crime that we are witnessing right now is just the beginning.  It is going to get a lot worse than this.

Whenever I do this type of an article, inevitably someone leaves a comment insisting that I am lying because crime rates are going down.

Well, that used to be true.  It is no longer accurate.

As an ABC News article that was just released explains, the crime victimization survey shows that violent crime in America has now increased for two years in a row…

The violent crime rate went up 15 percent last year, and the property crime rate rose 12 percent, the government said Thursday, signs that the nation may be seeing the last of the substantial declines in crime of the past two decades.

 

Last year marked the second year in a row for increases in the crime victimization survey, a report that is based on household interviews.

This is one of the primary reasons why so many people are moving out of the big cities right now.  In the city of Chicago, police are so overwhelmed with crime that they will no longer respond in person "to 911 calls reporting vehicle theft, garage burglary or simple assault".

Things have gotten so bad in Chicago that a 14-year-old girl was sexually assaulted as she was walking to a bus stop this week and it barely made a blip on the news.

But we have come to expect this kind of thing in crime-infested cities such as Chicago.  We don't expect it to happen in "quiet communities" such as Augusta, Georgia

"When we first moved out here three and a half years ago, my wife and I, it was a quiet community, it was a deal that we felt we couldn't pass up on," Don McIntee says.

 

McIntee lives in the Butler Creek Mobile Home Community, but he's trying to change that. He recently put his home up for sale because he says the crime in his neighborhood is too much to deal with.

 

"I want to live in a place that I feel is secure and safe for my wife because I'm out of town a lot," he says.

And it seems like criminals are becoming more brutal than ever.  For example, one thug actually put his gun into the mouth of a 92-year-old World War II veteran in Fresno, California and threatened to kill him during one recent home invasion…

"I was sound asleep at about one or two o'clock in the morning, all the lights were on and a guy shook me with a gun in my face. (I said) Hey what's going on? (He said) Shut up and he slapped me," he explained.

 

While the suspect held him at gunpoint, three others ransacked his house, taking about 200 dollars in cash and jewelry including his 1941 class ring from Woodlake High School in Tulare County.

 

"They were in there for almost a half hour," said Fresno County Sheriff Department spokesperson Chris Curtice. "So they had plenty of time to search the house, it was the middle of the night."

 

At one point, Joseph said one of the suspects put a gun in his mouth and threatened to kill him. While being ordered into the bedroom closet, he said he hit him in the head with a handgun, causing him to fall to the floor.

Was there any need for that?  That 92-year-old man was certainly no threat to the four home invaders.

But this is what is happening all over the nation now.  Criminals appear to be getting crazier and crazier.

In Houston recently, one team of home invaders decided to storm a house at 8 AM in the morning while people all along the street were leaving their homes to go to work and to school…

It was about 8am — daylight, with people going to work and kids going to school, yet no one apparently saw this coming. The homeowner told me four men, armed with guns, broke in through her garage and forced their way inside her house.

 

The woman's daughter and son-in-law were in the home with her, along with two of their daughters, ages four and six. The homeowner says the gunmen pointed guns at all of them — even the children — and demanded money over and over. They ransacked the house and the cars- and eventually got away with some cash, at least one cell phone and the homeowner's wallet.

Who robs a house at 8 AM in the morning?

That is either incredibly bold or incredibly stupid.

In my article yesterday, I included another example of a crime which is either incredibly bold or incredibly stupid.  One very enterprising carjacker actually decided to try to carjack the police chief of Detroit while he was sitting in a clearly marked police vehicle…

Just four months on the job, Detroit’s new police chief got an early taste of the city’s hardscrabble streets.

 

While in his patrol car at an intersection on Jefferson two weeks ago, Police Chief James Craig was nearly carjacked, police spokeswoman Kelly Miner confirme
d today.

 

Craig said he was in a marked police car with mounted lights when a man quickly tried to approach the side of his car. Craig, who became police chief in June, retold the story Monday during a program designed to crack down on carjackings.

So what is going on here?

Are criminals becoming bolder or are they just becoming stupider?

I don't have an answer for that question, but one thing seems certain – crime is definitely getting worse.

As I mentioned at the top of this article, some criminals are now actually stealing entire truckloads of food.  A recent CBS News article explained how they are doing this…

To steal huge shipments of valuable cargo, thieves are turning to a deceptively simple tactic: They pose as truckers, load the freight onto their own tractor-trailers and drive away with it.

 

It’s an increasingly common form of commercial identity theft that has allowed con men to make off each year with millions of dollars in merchandise, often food and beverages. And experts say the practice is growing so rapidly that it will soon become the most common way to steal freight.

And what we are talking about is not just a few isolated incidents.  This is literally happening from coast to coast and the dollar values of some of these thefts are staggering…

News reports from across the country recount just a few of the thefts: 80,000 pounds of walnuts worth $300,000 in California, $200,000 of Muenster cheese in Wisconsin, rib-eye steaks valued at $82,000 in Texas, $25,000 pounds of king crab worth $400,000 in California.

As economic conditions continue to deteriorate, I actually expect that we will start seeing armed guards on food trucks in a few years.

Desperate people do desperate things, and as food prices continue to rise I believe that food trucks will become highly prized targets.

America is rapidly changing, and not for the better.

So what are things like in your area of the country?

Are you noticing an increase in crime?


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/DcTIBQgrAGQ/story01.htm Tyler Durden

Ron Paul's New Monetary System "Get The Government Out Of The Way"

As part of Mike Maloney's recent documentary, Ron Paul was interviewed to discuss the monetary system that he proposes. He begins… "Just get the government out-of-the-way, you know, and let the markets decide and apply the rules of  ’no counterfeiting’  to the people and to the government…" as he goes on to discuss everything from The Founding Fathers to how a gold standard could work…

 

Via Market Sanity,

The following is a bonus feature on the Hidden Secrets of Money episode 4. The video can only be watched by subscribing to Hidden Secrets of Money. However, a full transcript of the interview has been written by Market Sanity for your convenience:

Mike Maloney: If you could create a monetary system for the world, what would it be?

Ron Paul: Just get the government out-of-the-way, you know, and let the markets decide and apply the rules of  ’no counterfeiting’  to the people and to the government.

MM: So you would make fraud and theft illegal for everybody, not just everybody except the financial sector?

RP: Ya. If you and I devised a gold standard and we issued certificates that were guaranteed in gold, then if we ever defrauded people we ought to go to jail for it. That would be the minimal role of government. But you know, today, the Constitution still says – even though they ignore it – that only gold and silver can be used as legal tender.

If the government wanted to issue a gold coin and make sure that it was an honest weight and measure, it still would be legal for the state to do that. But, I think because it’s a mandate on the states; the states should not use anything other than silver and gold. That interpretation should be rather broad too: that the states could do it. The prohibition against the states was that they couldn’t issue bills of credit. The Founders knew what paper money meant because the states were doing it like crazy. That’s one of the reasons why they had the Constitutional Convention was because of the monetary issue. So they [the states] aren’t allowed to print money. And that’s OK, that’s counterfeiting. At the same time, they could use gold and silver.

But I would allow the market to work, because I think we’re more sophisticated on money now through free market understanding. The Founders accepted the notion of a fixed ratio between gold and silver. Bimetallism is not a good economic theory because it’s too rigid. If there’s a discovery of silver, and the price of silver goes down, you know, you want that to be flexible.

But that doesn’t mean the free market wouldn’t use gold and silver. Just look today. It’s so much easier to adjust, you know, with our computers and all. If you walked into a store, I could just imagine. In many places, more likely in foreign countries, they’ll take dollar or their local currencies and have immediate conversion. But you can also have immediate conversion between gold and silver, or certificates in silver or a credit card in silver. You could pay it in silver. You can pay it in dollars or Euros today and it’s immediate.

I would let the market decide it. It could be that they want to use a basket of commodities. I’m still old-fashioned enough that if I’m thinking in terms of a unit of an account, and I have a bunch of them on paper or on a credit card…if I want to put them in a handful of silver or a handful of gold, I like that idea. That for me is the ultimate test, but it doesn’t mean another system wouldn’t work if you followed these basic rules.

It would not be flawless because people have the tendency to break the rules, but happens when a government has the worldwide fiat currency and breaks the rules for 40 years? That is such gross distortion, and that’s why the imbalances are so great right now of the debt and the debt system and all the malinvestment. They did not prevent the correction, they just propped it up in 09′. So the correction didn’t occur, and if you want the system to continue you really have to allow the correction to happen. That, of course, is why we haven’t had a recovery.

 


    

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/ryh2Fib0kaU/story01.htm Tyler Durden

Ron Paul’s New Monetary System “Get The Government Out Of The Way”

As part of Mike Maloney's recent documentary, Ron Paul was interviewed to discuss the monetary system that he proposes. He begins… "Just get the government out-of-the-way, you know, and let the markets decide and apply the rules of  ’no counterfeiting’  to the people and to the government…" as he goes on to discuss everything from The Founding Fathers to how a gold standard could work…

 

Via Market Sanity,

The following is a bonus feature on the Hidden Secrets of Money episode 4. The video can only be watched by subscribing to Hidden Secrets of Money. However, a full transcript of the interview has been written by Market Sanity for your convenience:

Mike Maloney: If you could create a monetary system for the world, what would it be?

Ron Paul: Just get the government out-of-the-way, you know, and let the markets decide and apply the rules of  ’no counterfeiting’  to the people and to the government.

MM: So you would make fraud and theft illegal for everybody, not just everybody except the financial sector?

RP: Ya. If you and I devised a gold standard and we issued certificates that were guaranteed in gold, then if we ever defrauded people we ought to go to jail for it. That would be the minimal role of government. But you know, today, the Constitution still says – even though they ignore it – that only gold and silver can be used as legal tender.

If the government wanted to issue a gold coin and make sure that it was an honest weight and measure, it still would be legal for the state to do that. But, I think because it’s a mandate on the states; the states should not use anything other than silver and gold. That interpretation should be rather broad too: that the states could do it. The prohibition against the states was that they couldn’t issue bills of credit. The Founders knew what paper money meant because the states were doing it like crazy. That’s one of the reasons why they had the Constitutional Convention was because of the monetary issue. So they [the states] aren’t allowed to print money. And that’s OK, that’s counterfeiting. At the same time, they could use gold and silver.

But I would allow the market to work, because I think we’re more sophisticated on money now through free market understanding. The Founders accepted the notion of a fixed ratio between gold and silver. Bimetallism is not a good economic theory because it’s too rigid. If there’s a discovery of silver, and the price of silver goes down, you know, you want that to be flexible.

But that doesn’t mean the free market wouldn’t use gold and silver. Just look today. It’s so much easier to adjust, you know, with our computers and all. If you walked into a store, I could just imagine. In many places, more likely in foreign countries, they’ll take dollar or their local currencies and have immediate conversion. But you can also have immediate conversion between gold and silver, or certificates in silver or a credit card in silver. You could pay it in silver. You can pay it in dollars or Euros today and it’s immediate.

I would let the market decide it. It could be that they want to use a basket of commodities. I’m still old-fashioned enough that if I’m thinking in terms of a unit of an account, and I have a bunch of them on paper or on a credit card…if I want to put them in a handful of silver or a handful of gold, I like that idea. That for me is the ultimate test, but it doesn’t mean another system wouldn’t work if you followed these basic rules.

It would not be flawless because people have the tendency to break the rules, but happens when a government has the worldwide fiat currency and breaks the rules for 40 years? That is such gross distortion, and that’s why the imbalances are so great right now of the debt and the debt system and all the malinvestment. They did not prevent the correction, they just propped it up in 09′. So the correction didn’t occur, and if you want the system to continue you really have to allow the correction to happen. That, of course, is why we haven’t had a recovery.

 


    

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/ryh2Fib0kaU/story01.htm Tyler Durden

Guest Post: Is Obama Through?

Originally posted at Monty Pelerin’s World blog,

Is Obama through? That is, have his lies and incompetence finally caught up with him and emasculated what remains of his effectiveness. Has he taken the concept of “lame duck” to new levels?

Dan Henninger describes Obama’s credibility problem:

Bluntly, Mr. Obama’s partners are concluding that they cannot do business with him. They don’t trust him.

Henninger’s observation does not bode well for US – International relations. Nor is it likely to provide support for new domestic initiatives.

The International ramifications are especially dangerous. It is difficult to think of one ally that supports the US as strongly as it did when Obama took office. More damaging is the spectacle that the US has become for the rest of the world. Obama, supported strongly upon election by most of the world, is now held in lower esteem Internationally than in the US.

Nations that thought of the US as a model of democracy, economic strength and leadership justifiably are questioning these assumptions. Some now see us as just another country moving toward Banana Republic governance.

Domestically, matters may be worse for Obama. Republicans, who distrusted him from the beginning, are even firmer in this belief as a result of the budget shutdown and other false promises. Democrats see the tactics and competence of the man and his Administration. As he is perceived to shift from asset to liability, their loyalty will shift.

Political ideology is not absolute. Democrats love liberalism and progressivism but not nearly as much as they love their office and place in power. If it comes to a choice, ideology and political loyalty will be abandoned in order to retain office.

Mr. Henninger’s quote limited his observation to “partners,” which can be construed as other political leaders or figures. However, Mr. Obama still has most of his voter support. Obama still has the ability to lie and much of  his support base is too disinterested to care. Many are incapable of  understanding politics beyond the cult of personality and “what’s in it for me.” Many would vote for Ted Cruz if he convinced them he would provide more freebies than Obama.

While Obama’s cult status is gone, his popularity among the masses remains. He has lost his ability to work with “partners” but not with the masses. What remains may still be enough for Obama to continue to weaken the US economically and politically.

His popularity always was dependent on his unusual and unconscionable ability to lie and convince people that there was a “free-lunch” if they supported him. His messianic overtones were merely Hollywood enhancements to his mendacity.

How much remains of Obama’s ability to remain effective depends on what the “uninformed” followers believe. Some of these will never question him. Others may be influenced by the shallowness that passes for today’s media. The media have been Obama’s most loyal ally. Whether that continues in the light of the ObamaCare fiasco is moot.

It is going to be hard to support ObamaCare for the media when Obama supporters experience the sticker-shock at enrollment (if the enrollment system ever gets fixed). Many believe they are going to get free health care. Most believe they are going to get large savings and better plans. All are in for rude surprises.

The failure of ObamaCare likely means the end of media protection for Obama. Survival for them is just as strong a motivation as survival for politicians.


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/X4Fi76W3JHM/story01.htm Tyler Durden

60% Of 401(k) Participants Accumulated More Debt Than Retirement Savings

The average 401(k) and other defined contribution (DC) plan participant now defers over 8% of their annual income toward retirement savings through their plan and social security taxes, making it one of the largest expenses for households. However, as HelloWallet found, retirement readiness remains stubbornly low: the typical worker near retirement only has about 2 years of replacement income saved, or about 15 years short of the median lifespan post-retirement.

 

One explanation for the stubbornly low retirement readiness of workers may be an increase in household debt. With more household income going to pay off debt, households may have less money to save and face higher costs of living in retirement. In fact, over 60% of workers accumulated more debt than they contributed to retirement savings between 2010 and 2011.

 

 

The study, which analyzed consumer finance data from the Federal Reserve and the U.S. Census Bureau, underscores the need for retirement plan sponsors to provide participants with holistic, independent financial guidance. Without that support, increases in 401(k) and other DC account balances will be off-set by growing liabilities on the other side of a participant's ledger.

The research finds that 20% of participants in 401(k) retirement programs added more credit card debt to their family balance sheet than they contributed to retirement savings. Other findings in the research include:

  • Monthly debt payments for households near retirement increased by 69% between 1992 and 2010, now totaling $.22 for every $1.00 earned by DC plan participants near retirement.
  • DC participants who accumulate debt faster than retirement savings have 50% less of their annual income saved for retirement compared to DC participants who contribute more to their retirement funds than they accumulate in debt.
  • Most DC participants who accumulate debt faster than retirement savings are over 40 years old, college educated, earn over $50,000, and have insufficient emergency savings.

"Through retirement plans and social security taxes, the average 401(k) participant now contributes over 11 percent of their paycheck to retirement savings every month, yet the typical worker near retirement has only about 2 years of replacement income saved," said HelloWallet founder and CEO Matt Fellowes, a former Brookings Scholar who led the study. "The growth in household debt is one big reason why retirement readiness is so stubbornly low."

"While there is no question about the fundamental value and importance of the 401(k), our research finds that it is just one piece of the puzzle," said Fellowes. "Until we work on improving all components of retirement readiness, it will be very hard for employers to fundamentally move the needle."  

While US companies invest $118 billion annually in 401(k) programs for their employees, and retirement savings is now one of the largest budget line items for US households, HelloWallet's new research suggests that these investments are not always producing the intended outcomes. In many cases, better holistic financial guidance could provide employees with the knowledge necessary to crawl out of their debt deficit and steadily build a secure retirement.

To receive a complete copy of the study, click here.


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/ZmS8rVRL148/story01.htm Tyler Durden