Things are not looking so good on the economic front these days. I listened to Lew Rockwell's podcast of a big time money expert this morning and he essentially said that the banks are broke. I fall on the floor and I laughing. The expert said that there is lucky to be 10% of any banks deposits on hand in cash. The rest is in play as loans of some sort. That means that if you have $1000 in your bank, they have $100 to cover your withdrawal. That is big of them!
Banking is fast becoming the home of the major scammers of this country. Those boys are playing fast and loose with the money and depending on the federal reserve and the fedgov to back them up or bail them out. And the FDIC is fast losing their stash of bailout money. That is sorta like you having a wreck and when you make a claim on your insurance you are informed that the insurance company is all out of money and "have a nice day." What a bunch of pimps! If you or I invest in anything and it goes broke then we stand to lose our investment. But not a bank. They have the fed reserve and the fedgov to back their plays. Our money has to insure that the banks are solvent and that we can get out money out when we want it. I think that is called self insurance.
You might get 3% return on your savings if you are lucky. The bank can loan out your savings at the rate of $9 for every dollar you have on deposit. That is what they mean by fractional banking. But I am getting into Mayberry's video of last week and you will be better off watching it rather than listening to me. Watch that video and you will know one of the reasons I am a survivalist. These guys out here are crooks! And the fedgov backs them! Talk abot a lose-lose situation.
The big news, other than the economic whiz on Lew Rockwell saying the banks are broke, was the page that said we have taken a 10% cut in pay so far this year. If you don't think all this money mumbo-jumbo has any bearing on you then maybe you had better think again. With prices going off the chart, taxes going up, inflation headed for the moon and a few other little goodies, you have had a 10% cut in pay these first six months of 2008. Your pay wasn't actually cut, but what you can buy with it is 10% of what it used to be just last year. And the federal reserve is going to have to inflate it's way out of the bank morass. That could be a few extra trillion dollars floating around with nothing but the full faith and credit of the United States government to back it up.
The stock market is showing signs of life. I cannot think of why it would be. I wouldn't buy stocks in this market for any reason. The price of oil is going down. Why not? It was manipulated by the powers that be to begin with. The Arabs kept saying that there was no oil shortage, everyone was getting their order filled. But the dollar has not fallen to 50 cents and that surprises me. It is worthless as tits on a boar. Too much of it being printed. Don't forget that about 90% of the national budget is already spoken for come budget time. There really isn't much wiggle room for the money the fedgov takes in annually. Most of it is already spoken for. So where is all this bail-out money going to come from ? From off the printing presses, that's where. The fedgov will have to inflate it's way out of this trouble. And our prices keep going up and so will our taxes.
All I can say is keep on prepping and get ready for the crash. You gotta stay alive.