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True Obama debt bigger than planet’s entire GDP
 President Obama |
As the Obama administration prepares to finance a Fiscal Year 2011 budget deficit expected to top $1.6 trillion, the American public is largely unaware that the true negative net worth of the federal government reached $76.3 trillion last year.
That figure was five times the 2010 gross domestic product of the United States and exceeded the estimated gross domestic product for the world by approximately $14.4 trillion.
According to the U.S. Department of Commerce Bureau of Economic Analysis, U.S. GDP for 2010 was $14.861 trillion. World GDP in 2010, according to the International Monetary Fund, was $61.936 trillion.
“As government obligations continue to spiral out of control and the U.S. government shows no willingness to make the magnitude of spending cuts required to return to fiscal responsible, the U.S. economy is headed to a great collapse coming in the form of a hyper-inflationary great Read more…
Tsunami of Inflation to Hit U.S. with Japan Crisis
The earthquake, tsunami, and nuclear disaster that hit Japan this past week and the destruction that it caused is nothing compared to the tsunami of inflation that will soon hit the U.S. as a result of this crisis. A tsunami of inflation in the U.S. will mean a complete collapse of our monetary system, which could lead to millions of deaths due to a lack of food and heat. 44 million Americans are now dependent on food stamps, but when the U.S. dollar becomes worthless as a result of hyperinflation, the government will no longer have the power to support these Americans and many of them will simply starve to death.
Japan’s citizens were smart enough to save up $885.9 billion in U.S. treasuries to spend in a situation like it finds itself in today. The U.S. has no such savings and is the world’s largest Read more…
US Treasurys Dumped, Pimco Sees Value In Emerging-Market Bonds
NEW YORK (Dow Jones)–The valuations on U.S. Treasurys are not attractive in a historical context and Pacific Investment Management Co. is moving money toward emerging-market debt, said the fund’s founder Bill Gross in an interview on Thursday with CNBC.
Reports came out on Thursday that the bond-fund giant had dumped all of its holdings of U.S. government bonds. Gross said better valuations can be found elsewhere, where yields are not artificially boost by Federal Reserve purchasing.
“The overvaluation [in Treasurys] has been dependent on the purchasing power of the Fed,” said Gross, who does not believe there will be a third round of “quantitative easing.”
Pimco did not participate in Thursday’s 30-year auction nor Wednesday’s 10-year auction, Gross said, though both were considered well-received.
The fund still owns about Read more…
The Coming Rout QE3
There’s a scenario that could play out between May and September in which commodities (including my beloved silver) and the stock and bond markets could all sell off between 20% and 40%. The trigger will be the cessation of QE II and a multi-month pause before QE III.
This is a reversal in my thinking from the outright inflationary ‘buy with both hands’ bent that I have held for the past two years. Even though it’s quite a speculative analysis at this early stage, it is a possibility that we must consider.
Important note: This is a short-term scenario that stems from my trading days, so if you are a long-term holder of a core position in gold and silver, as am I, nothing has changed in my extended outlook for these metals. The fiscal and monetary path we are on has a very high likelihood of failure over the coming decade, and I see nothing that shakes that view.
But over the next 3-6 months, I have a few specific concerns.
It’s time to build on the idea I planted in the Insider article entitled Blame the Victim (February 28, 2011) where I speculated on the idea that the Fed might be forced to end its Read more…
Inflation Group Says U.S. Cities Will Be Like Egypt in Four Years
The National Inflation Association has issued a chilling new advisory in which it warns that the inflationary time bomb being created by the policies of the Federal Reserve will lead to American cities experiencing similar chaos currently unfolding in Egypt by 2015.
Egyptian dictator Hosni Mubarak has been in power for three decades and in that time has managed to handle all manner of threats to the stability of his regime. But it was the huge unrest sparked by soaring food prices that finally led the Egyptian people to launch a revolution which is likely to see Mubarak forced out of office for good.
“Food inflation in Egypt has reached 20% and citizens in the nation already spend about 40% of their monthly expenditures on food. Americans for decades have been Read more…
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