Posted by: graemebird | July 6, 2010

The US Will Soon Collapse Into Anarchy

As discussed many times before, tracking whether a country is in or out of recession, by way of tracking GDP, makes no sense whatsoever. Real GDR would be a better metric. However the unemployment rate is an excellent proxy. And since we have unemployment plotted for the US we can answer the following question with great clarity;

Is the US in the depths of recession still? Or has it moved into the recovery phase?

As you can see there is no recovery. Or as Gerald Celente often says “Its not a recovery. Its a coverup.”

Profits were boosted with deficit spending. The stockmarket was blown up with money at almost zero interest given straight to Goldman Sachs and the other cronies. There is no recovery nor any sign of it.

Once the stimulus packages all run out there could, with a little bit of luck be some tiny drop in unemployment for awhile. But things are jacked up for this to be fleeting. The level of unfunded liabilities means that only conscious and radical policy change could bring the US out of recession.

The US will not ever get out of recession with current policy. The US will crash into anarchy on its current glide-path. There isn’t any doubt about this at all. Only radical policy reversal could, even in theory, save them now. And I don’t see any way this radical policy could happen politically. We are talking partial Jubilee, or the ease of bankruptcy laws amounting to same. We are talking a massive government culling of departments. The move towards 100% backing to end banking-parasitism.

Can any of you see all this happening at once and soon? No?


So we have to face the reality of collapse-to-anarchy in the US definitely. Probably in Europe too. Where does that leave the rest of us?

This is the reality we are dealing with. This isn’t even Soothsaying. Because the US could technically save themselves as I said. But I think we all agree that politically-speaking, this is so unlikely that we can rule it out for now. So the US will not be saving itself.

Make your plans accordingly. Since there really is no doubt about this.



  1. Excellent talk on the mismanagement of world war II on the allied side:

  2. Great post.

    World Economic Collapse explained in 3 minutes:

  3. Why US unemployment dropped last month
    Troubling reason for drop in unemployment rate: People exiting work force

    By Mark Trumbull, Staff writer
    posted July 2, 2010 at 5:49 pm EDT

    America’s official unemployment rate declined in June, but the reason was largely because people are opting out of the labor force – not because employers are adding lots of new jobs.

    It’s a sign of how difficult the job market remains, and it comes as Congress recessed for the July 4 holiday without extending jobless benefits for the long-term unemployed.

    Despite signs of economic recovery in recent mnths, the overall labor force shrank by 652,000 in June, even though the US population grew, the
    Labor Department reported Friday. That helped push the unemployment rate down to 9.5 percent, from 9.7 percent in May.

    If the labor force participation rate had held steady for the month, at roughly 65 percent of the civilian population, the unemployment rate
    would have gone up – to about 10 percent – based on the current number of jobs in the economy.

    “As the US population grows by about 200,000 each month, the labor force is also expected to grow,” economist Charles McMillion said Friday in a report analyzing the monthly job-market data. In his view, the situation “almost guarantees that unemployment will again rise to over 10 percent
    when more of the unemployed again agree to be counted.”

    Earlier this year, as the job market began to show some signs of revival, labor force participation rose – meaning more people began
    looking for work. But the influx may have outstripped the number of available new jobs, sending some discouraged workers out of the labor force in the past two months.

    The reversal, by Mr. McMillion’s calculation, means that the labor force is no larger than it was when the recession began in late 2007, even
    though the adult population has risen steadily since then. And 1 million fewer people are in the work force now than one year ago.

    The central problem is that, with so many already unemployed, there are multiple job seekers for every open position. Some 6.8 million people
    have been jobless for 27 weeks or more. Legislation in the Senate to extend jobless benefits, which have begun to run out for many long-term unemployed, stalled amid disagreement over how to pay for it. The House
    has passed an extension of jobless benefits.

    Who’s leaving the labor force, or not entering to begin with?

    Labor Department data suggest that the problem spreads across virtually all demographic groups, but the trend is strongest among the men,
    African-Americans, and the young. Regionally, the Midwest appears to be most affected. Here are the numbers:

    •Overall, labor force participation has fallen by 1.5 percentage points
    since January 2008, as the recession had just begun (from 66.2 percent of civilian adults – excluding those in prison – to 64.7 percent).

    •Among men, participation has fallen 2 ercentage points, while it has fallen 1.1 percentage points among women. Looking at 2010 alone, men’s
    participation has risen slightly – perhaps a sign of rebounding hopes or expectations of finding work, while women’s participation has continued
    to edge down.
    •Among African-Americans, participation has fallen 2.1 percentage
    points, versus 1.4 for whites.

    •By age, participation has declined most for teens (7.1 percentage points) and young workers ages 20 to 24 (down 3.3 percentage points).
    Declines have also occurred among older workers, but by amounts smaller than the national average.

    •For one age group, those 55 and over, participation has actually risen during and after the recession – a sign of the headwinds facing many people in or near retirement. Many homes and investment portfolios have lost value.

    A silver lining in the June jobs data is that the private sector added at least some jobs (83,000) for the sixth straight month.

  4. “America’s official unemployment rate declined in June, but the reason was largely because people are opting out of the labor force – not because employers are adding lots of new jobs.”

    Right. The Shadow Government Statistics people add these people back to get their figure of 22% unemployment. With 22% unemployment its pretty clear that there is no recovery at all. Anyone thinking that the US is out of their depression is tripping.

  5. Mark Hill not keeping up as usual:

    “…. Oswald got what was coming to him……”

  6. Its a very easy thing to get this unemployment down. Its a matter of asking everyone to save, slashing spending, state, federal and local and phasing to 100% backing to get rid of banking parasitism, find some way to make it easy for people to default any debts to the banks.

    What this would do is release massive resources for business-to-business spending, and this would employ everyone. We see from the income statement that salaries and wages are a business expense. More resources for business spending, means more business expenses. The policy therefore implies less profits and more employment.

    However there is a catch to it. The policies, as outlined above also imply lower NOMINAL but higher REAL wages. What this means is for the policy to work in its entirety prices and wages have to fall, for any given level of spending. Nominal prices have to fall faster than nominal wages. But both have to fall.

    The other alternative is for spending to increase slowly, for wages to stay about the same, and for prices to fall.

  7. Here is the debt clock for the US. But on the far right hand side you will see its a debt clock for the entire world. You will see that the worst debtor is now the Japanese government. Here we have the real reason for comparative Japanese stagnation. The fractional reservists got to them.

    No matter how strong your situation is, it is never so strong that bank parasitism cannot screw it up. In fact the richer you are the more blood you have for these vampires to feast on.

    While you watch the numbers tick over to oblivion, bear in mind, that the people who are providing all this debt are creating no new resources. The debt is an unmitigated disaster, since only a fraction of it represents resources recycled from savings. Most of it represents the extorting of resources from the public, to be lent back to the public. We (that is to say humanity taken as whole) are getting no benefit whatsoever from these increasing debt levels ….. NOT EVEN IN THE SHORT RUN.

    I’m aware that many people don’t understand the above. But to understand the racket of fractional reserve is to understand the reality of the last statement.

    Note how in no case is debt falling. No case, at least, on this debt counter. If anyone has any information about a country who is pulling down its debt levels certainly that would be useful information. Is any country pulling down both private and public debt AT THE SAME TIME?

    In one way, getting these debt levels down implies an outright challenge to the banking overlords. Since it tends to imply that the country who was doing this, was increasing its reserve asset ratio and therefore cutting the bankers out of the money creation spigot. The money-creation thieving-orgy. This is not tautologically true. Matters could be otherwise. A country could get its debt levels down in theory, without increasing its reserve asset ratio.

    In practice this is a very hard thing to imagine. Since paying off debt, under fractional fiat, tends to reduce the money supply, making it harder to pay off more debt. Its a classic addiction phenomenon.


    Once society-wide, now with the increasing strength of the bankers ….. debt-addiction has become a global phenomenon. Global debt addiction. Global debt junkiedom. The only PRACTICAL treatment to this now global junkiedom is to phase to 100% backing, along with a host of other measures, not excluding partial Jubilee.

    I don’t expect to be contradicted, on this partial-Jubilee-CONTENTION (directed exclusively at money-creators) by anyone sensible-That is to say; anyone sensible who has looked at the debt-clock for a while in contemplation. That a partial Jubilee, or mass bankruptcy, is absolutely necessary, is an unassailable fact, based simply on the magnitude of the debts involved.

    Inflation is no way out. Because inflation means a misdirection of resources, and further impetus towards debt addiction. But against inflation being no panacea, we have the fact that, without galloping inflation, the size of the debts are insurmountable.

    In other words, without partial-Jubilee (or mass bankruptcy) the debts cannot be paid, with or without inflation. The above factorizes down logically to the position wherein the debts cannot be paid back under any circumstances without partial Jubilee (or the harsher route of mass-bankruptcy). Nor is it moral to attempt to pay the totality of these debts off. What such an attempt would amount to, is no less than enslavement, under the banking oligarchy. It is moral to get into surplus budgets in every government entity and stay in surplus. But it is not moral to endlessly send resources to the bankers who have manifestly fucked up.

    I recommend a purposeful asset-price-collapse with almost total Jubilee, (where the debts are owed to money-creators.) This is the fairest social contract and probably pretty close to politically possible, if the influence of the banks could somehow be neutralized. Where debts are not owed to money-creators I recommend that the payment of both principle and interest on these more morally-created debts, be tax-deductible.

    The reason I think this is pretty fair, is that it means that asset-holders will often be able to keep their assets, but their assets will have less monetary value. Or sell their assets, and wind up with a positive amount of cash. Their net wealth will be reduced, but since their debts will be almost eliminated their cash flow may be improved…….

    Thats the balance we want to aim at….. Reduced net wealth and asset values along with improved cash flow and debt elimination. Because its a terrible thing to do to someone, to crash his asset values and his cash flow at the same time ……………… and these two personal catastrophes sent his way without reducing his debt load.

  8. “Note how in no case is debt falling….”

    Here we see why this depression is worse than anything in living memory. Perhaps this phenomenon is shared in common only with the last American recession which came after the demise of the NASDAQ bubble and then 9/11. For the first time ever the recovery meant MORE AND NOT LESS DEBT.

    In reality there was very little in the way of recovery. Rather there was the classic “prosperity delusion” that is part of investment asset inflation. People feel richer than they really are. They feel rich, even though their countries productive capacity is stagnating, and being shipped overseas.

    But prior to the 1990’s recessions meant the reduction of debt levels. This may seem paradoxical, since recessions mean that it can be harder to pay your debts off. But the Volker crunch was a marvelous thing. Because it meant the retirement of vast amounts of debt, and the American savings rate quickly went up to the high teens. Partial Jubilee would achieve the same effect, but with a great deal less humiliation and pain.

    One thing deeply sinister about the Volker crunch was this;

    By and large the “too-big-to-fail” criminals of those days were bailed out on the sly. It was a far less publicized matter, than this more recent open-and-brazen stealing, that has just been visited-upon Europe and America. But most of the really big banks, during Volkers crunch-time, were stealthily bailed out, whereas hundreds of smaller banks went to the wall. This was the result of cronyism. The natural way of things would have been runs on the bigger banks, with many smaller banks surviving. Since bigger banks tend to function on lower effective-reserve-asset-ratios. They tend to take bigger risks because under normal business circumstances they can get away with it.

    But in any case they were disgracefully bailed out back then, these welfare queens, and they have gathered further power, in the market and in government, and have returned with a vengeance to help destroy the US.

    So during recessions we want debts to be strongly reduced. And since we have not seen this in Japan, the US and Western Europe, this time around ….. or indeed anywhere that I know of ….. Because of this we simply cannot get back to economic and societal health. The power of the banks is now so extreme, that they are preventing any recovery at all in the US, Europe and Japan ….. and they are preventing true economic health pretty much everywhere else too.

    From the position we now find ourselves in we must set policy so as debt will reduce during, the recession, the recovery, and the good times.

    We must set policy so that debt will reduce at every occasion. But how far ought this go?

    Is debt itself truly evil? Ought we get rid of all debt point blank?

    No this is not the case. What we must aspire to is a society where there is more cash than debt. Where there is debt but total debts are less than total cash.

    We ought to aspire to this situation and set all policy accordingly.

    First step is to phase to 100% fiat backing, and then to favor gold, silver copper and platinum (and perhaps some sort of government money, based on a strategic fuel reserve) ………. to favor these commodity monies over fiat.

    To get a smooth transition we don’t need to transfer from fiat to gold et al overnight. Rather we need to have the favored tax treatment of the non-fiat monies, lead to them crowding out the fiat. So that at first the fiat stops being printed at all so that its value drops only slowly. Thereafter the government has to run surpluses and be retiring this fiat to maintain its value …… since it would naturally lose its value too fast as people offloaded it to hold the tax-treatment-favored monies.

  9. “you referring to mel’s father?

    his theories are madder than Bird’s”

    Well don’t jump from foot-to-foot, like some dancing-Gook on a hot tin roof. Stop shooting blanks and disprove even one of my theories.

    Without lying that is.

    Try it.

    You will fail.

  10. why the hostility Graeme?

    people are clamouring for you down at commenters in exile. boy some of the graffiti there is obscene

  11. They should take their comments here. If they want to be helpful they can take their comments here. Obviously if they were just here to lie about Philomena, or be abusive to her, or just tell lies generally they’d get wiped. But if you or anyone else, just wants to talk in an intellectual fashion, you’ll always get your message through. Edney’s been getting stuff through even when I disagree with it. Because he’s stopped bullshitting for some reason.

    Even if you are on moderation you’ll eventually get any thoughtful message through. I’m not going to dirty myself by going down to that faggot sewer that Turkey-John-Z started. .

    Now try and prove one of my theories wrong! You get to choose any one of them thats still extant. So you have this massive choice in front of you. If I was as you say I am, it would be a dead easy task. But you are gypping yourself. Gypping yourself in a pack of smug know-nothings. But gypping yourself nonetheless.

    Seriously. If I was even a little bit like you people delude yourselves that I am, you wouldn’t need to be smug about it. You’d simply cut my argument to pieces in a pretty easy-going and patient way. I don’t want a great deal of derision and hand-waving about it. Just clearly state where I’m wrong in even one of my theories.

    But the fact is if I’m wrong, I’d have changed my mind prior to you getting to the end of your case.

    So you see you and birdlab and the others are just delusional. Try anything on. Anything at all. Not the idea that Russia was involved in 9/11 since I’ve stopped denying American involvement now.

    But anything current. You will be struggling to even make a minor point. Since all I’m doing is giving people the truth of the situation. Often under circumstances wherein the truth is as surprising to me, at first, as it is to everyone else.

  12. Why the hostility? Gee. What a mystery. Have you forgotten some of the things you’ve been writing recently?

    Stupid cunt Birdlab still at it. He quotes me saying something perfectly correct and thats it. Fucking genius huh?

    You see the people you have to get clubby with SOON, to maintain this level of delusion. It must be hard work SOON. It amazes me that you can put up with the company. Plus don’t you feel kind of dirty; Lying about Philomena all the time? She’s not and never was a fella SOON. So what exactly is your grubbiness all about? Pretty sick stuff if you ask me.

    • Regarding the US “collapse into anarchy” prediction that it will happen soon, care to give a time frame? Also, what indicators will you be using to determine when the technical anarchy phase begins? We don’t want you moving the goalposts, so come on Graeme, lay out the specifics.

      Or are you afraid to, remember your peak oil embarrassment?

      • You could suggest something if you want. Its only seldom possible to specify a clear time limit. Like for example. When will non-Americans get sick of buying American government debt? And what will be the American action when they do?

        Clearly this is something I’m not in a position to judge. And this would affect the timing, but is unlikely to affect the outcome, unless everyone suddenly becomes a Ron Paulist or something.

  13. graeme
    I draw the line at some graphic imagery

    • You ought to draw the line a lot earlier. Comparing yourself favorably to the jealous fags on that other site doesn’t make your act any better. When horrid fruitcakes get sick of mouthing Tina Turner songs onstage they go off and visit Turkey-JohnZ’s site.

      • a bit rich coming from you graeme. you made fun of skeptic’s friend in a wheelchair

      • But I’ve always regretted that. You know what that was about. Everyone was ganging up on me so I started kicking everyone in the throat. The bad thing about it is I always thought the ghost in the machine was a really neat chick. This is no argument SOON. I never hassled any of you for being nasty to women. Only for carrying on the nastiness for too long. Greenfield and Sutcliffe were both extremely nasty. But they pulled themselves up and stopped doing it-toned their act down. Thats because those guys are inherently quality whereas the rest of you are riff-raff. Both were almost frighteningly nasty. Just a bit of a reminder was all it took. Then their gentlemanliness kicked in.

  14. “Even if you are on moderation you’ll eventually get any thoughtful message through. I’m not going to dirty myself by going down to that faggot sewer that Turkey-John-Z started. .”

    Spot on Mr B. They are Thoughtless Cunts aren’t they.

  15. Right. And not a little bit cowardly, grubby and sexist with it.

  16. Birdy,

    The moon’s a harsh mistress
    The sky is made of stone.

  17. I see you neglected to mention anything about my challenge to you regarding your US “collapse into anarchy” prediction.

    I’ll take that to mean you don’t really stand by your rather dubious assertions.

    • I have read no such challenge. I’m not going to that faggot sewer of Turkey-John-Z’s until someone has a mind for a serious toilet-wall graffitti-removal. I had a quick look and that was quite enough.

      Repeat your challenge here. Because I’m right about this. There are things they can do to avert disaster of course. I don’t see them doing these things. I doubt that you see them doing these things either. There is no use locking me in for a dopey Turkey-John-Z-like prediction. Because we cannot say just how bad or good their policy will be. But the taxeaters aren’t giving up on hundreds of government departments. The banks will not accept a phase-in to 100% backing. So we cannot know of any source by which the resources will be found to effect a recovery.

      Bear in mind that this should be the time of greatest business refurbishment. A swag of technologies have kicked in and could be applied if the business-to-business spending wasn’t being scuttled by the weight of prior debt, the current reality of banker parasitism, and the incredible deficit spending going on everywhere, so facilitated by banker-racketeering.

      I don’t go to Turkey-John-Z’s site, except I suppose to peak and run away. I’d feel grubby to do so. It is true that I check your feeble act out at Catallaxy. So reissue your alleged challenge THERE. I’ll be on top of any stupid-ass thing you say there within 48 hours.

      Everything I said in the thread-starter stands. It stands WITH THE CAVEATS MENTIONED. Its not to be sliced and diced. It stands as a whole. Everyone ought act accordingly. Since we KNOW there will be a breakdown in the US. We ASSUME there will be a breakdown in Europe and we can be pretty sure that the Japanese will continue to feebly tread water, despite all their advantages.

      What we don’t know is what that means for Australia. What it means economically. Politically. Geo-politically. But the breakdown and break-up of the US ought to be taken as given, unless a super-Reagan enters stage left.

      We know that there must be a US breakdown and break-up …….. Unless of course there is a sudden swing to my way of thinking to some degree or another.



  19. Well what do you know. The stupid cowardly boot-nigger is not willing to reissue his (presumably) idiotic challenge, now that he’s back in civilized company.

    Too primitive to be “a cad” or to be even so much as described as “yeller.”


  20. Well what do you know? Isn’t that funny?


    Isn’t that funny hey?

    Once you get away from that faggot-sewer, you cannot even so much as summon the moxie to make that challenge!!!!!!!!

    Third parties this fellow was a lifelong banker now a trader. And he appears to be a good trader, fast on his feet. Not good from a wealth-creation point of view, but certainly experienced and fast on his feet.

    That he is too gutless to reissue this alleged challenge to me PUBLICLY says a lot about the validity of what I’m saying in the threadstarter above.

  21. Joseph Cambria is a just a tawdry fucking joke. Exhibit Z5…

    “Tillers ………
    We’re all gentleman and ladies here after all.”

  22. Its Cambria’s “challenge” that lacks specificity. I’m not a soothsayer. So the timing is a little difficult. But we can be very sure, that despite all this wonderful technology, that the US cannot hold up under the weight of 1. bad and incompetent policy, what with the banking idiocracy, now basically running government 2. government and bank parasitism, and 3. all those unfunded liabilities kicking in.

  23. Does anyone really think things have changed since I wrote the above thread. Perhaps some of you still think that Rupert Murdoch is a newsman? The plane controls are locked, the US is going down.

  24. How is that mining tax, not delivering a single dollar. Readers of my blog would have seen me complaining about this tax going exactly the wrong way. I claimed that the motives were fair enough (ie spreading the wealth of the mining boom) but the delivery was ridiculous and exactly the wrong way. The right way would have been to have gotten rid of the company tax in its entirety and increased royalties. That deflates asset prices, reduces banker involvement dead losses, and improves resource allocation.

    I expect the civilians to get sucked in by things like this. I’m not raining abuse on those outside of the economics game. But lets just contemplate the incompetence of the Australian economic profession in this regards.

    Also there is no excuse in saying that they couldn’t have gone the higher royalties road because of royalties being a state affair. There is work arounds there. The encouragement of higher state royalties in exchange for them to run large surpluses and a few other workarounds could have delivered the same effect.

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