Top 10 Triggers of a US Financial Collapse and the New Government Ponzi Scheme

Poor Man Survival

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Faith is one of the forces by which men live, and the total absence of it means collapse.

>>William James

 

A discussion of this topic was started on one of our social networks and I promised to write a condensed version of what I have touched on throughout the past couple of years.  If you recall how our economy fell apart after 911 and how Bush pushed for Americans to get out and buy stuff, this was a hint of what a calamity can cause.  Let us know what you think- leave your comments…

 

The dollar has lost 96% of its value since 1913…

 

 

 

 

 

Top 10 Potential Triggers of our Collapse

 

Over the years I’ve posed many examples of how our government treats citizens like crap.  Roughly 87% of Americans no longer like the federal government and with good reason:  Policies which have decimated middle class jobs, unfair tax system, a healthcare system which is proving to be a disaster, the trampling of our privacy and rights, an overregulated nation which is destroying job-creating entrepreneurism and so on.

 

The dollar became the world's reserve currency when President Nixon abandoned the gold standard in the 1970s. The dollar is used for 43% of all cross-border transactions. The dollar's value is strong as measured by central bank reserves -- 61% of these foreign currency reserves are in dollars.

 

China and Russia want an alternative to the US dollar and it could happen but it would take a tremendous amount work and resolve…

 

Altogether, foreign countries own more than $5 trillion in U.S. debt. If China, Japan or other major holders started dumping these holdings of Treasury notes on the secondary market, this could cause a panic leading to collapse. China owns more than $1 trillion in U.S. Treasuries. That's because China pegs its currency, the yuan, to the dollar. This keeps the prices of its exports to the U.S. relatively cheap.

 

Zha Xiaogang, a researcher at the Shanghai Institutes for International Studies, recently said:
 

The shortcomings of the current international monetary system pose a big threat to China's economy."

That's why China is now actively taking steps to phase out the U.S. dollar because of its frustration with the U.S. government's mismanagement of our currency. And how does our government respond? We have the audacity to label China a "currency manipulator!"

 

A few weeks ago I wrote a series of articles (including a free handbook) about how the government cannot even give us the truth about inflation.  Its number do not take into account health care costs, food prices or the cost of energy…all of which are crushing the finances of Middle Class Americans.

 

 

1.        The faith of citizens in the dollar, and our government finally evaporates.  We may be closer to that then what most think (but don’t worry, the government is spending full tilt to prepare for massive citizen uprisings.  This is one of the reasons DHS is militarizing local police forces).

2.       The faith in the US dollar by our debt holders and international investors fails.  To a degree, this is already taking place, especially in China, Russia and many other countries.

3.       The faith of our allies in Europe erodes due to the lack of leadership shown by Pres. Obama.  This too is already taking place with many in Europe looking to Germany for leadership.

4.       A national economic default or re-issue of a new currency.  This too is in the planning stage as is a federal takeover of all retirement accounts (mandating all retirement accounts be held in US investments).

5.       If our so-called leaders default on Social Security there will be hell to pay and civil strife like this country hasn’t seen since the Civil War.

6.       If the government pulls another FDR stunt whereby all citizens must turn their gold over to government authorities.

7.       Debt is a form of slavery.  International bankers run our money supply and citizens are in debt beyond anything reasonable.  It is virtually impossible for the nation to get out of debt short of default and that applies to many citizens as well.  As jobs pay less and offer zero benefits, many will no longer be able to afford to live here.  We’ve already lost 10% of the middle class and more people are leaving the US to live in cheaper countries.  More than 50% of citizens get some kind of government assistance usually in the form of food stamps, Section 8 housing, etc.  If those benefits are eliminated, chaos will reign.

8.       Public sector workers in many communities were over-compensated and promised gold-plated retirement benefits which taxes can no longer support.  Detroit is an example of 50 years of Democratic rule which bankrupted the city, killed public services and fostered a massive population exodus.  Many other cities will go the same route creating a lot of unhappy retirees (most public sector employees only had to work 20 years to get a full pension and benefits & politicians get EVEN better benefits from feeding at the public trough).

9.       Roughly 30% Americans have no emergency fund nor know how to budget or as the old adage states “most Americans are only a paycheck away from being homeless.”  If Washington whittles away or eliminates the various lifelines, civil rest will ensue.

10.   As the government continues to bankrupt the nation and trounce our Bill of Rights, enough folks will get angry and they won’t take it.  This is what has happened throughout history.

 

 

Someone once said that every form of government has one characteristic peculiar to it and if that characteristic is lost, the government will fall. In a monarchy, it is affection and respect for the royal family. If that is lost the monarch is lost. In a dictatorship, it is fear. If the people stop fearing the dictator he'll lose power. In a representative government such as ours, it is virtue. If virtue goes, the government fails. Are we choosing paths that are politically expedient and morally questionable? Are we in truth losing our virtue? . . . If so, we may be nearer the dustbin of history than we realize.

 

 

In many respects, America is at the end of its empire and a dollar collapse is possible, but not probable.

 

We’ve squandered our resources engaging in wars that enrich corporate America.  We have created a bizarre, unfair tax system which rewards the rich and works against small business owners and job creation.  Our legal system works well for the rich but no so well for the poor (we have more people in prison than any other nation).  We have more laws, rules and regulations (created primarily by unelected bureaucrats) than any other nation and it is choking the vitality out of our country.

 

If you read through this list, you probably discovered a common thread – FAITH in the system and how it is being eroded by dysfunctional politicians and bureaucrats at every level of government.

 

What’s truly sad is the fact there are so many spineless citizens who do not have a clue as to what is happening, to how our country is being destroyed from within.

 

This is actually the NUMBER ONE CAUSE OF OUR DESTRUCTION – citizens who do not care.

 

A dollar collapse is when the value of the dollar falls so fast that all those who hold dollars panic, and sell them at any cost. In this scenario, sellers would include: foreign governments who hold U.S. Treasuries, traders in exchange rate futures who trade the dollar versus other currencies, and individual investors who demand assets denominated in anything other than dollars.

 

What Would Cause This to Happen?

Several conditions must be in place before the dollar could collapse. First, there must be an underlying weakness. Second, there must be a viable currency alternative for everyone to stampede into. Third, a triggering event would need to occur.

The first condition does exist. The dollar declined 54.7% against the euro between 2002 and 2012. Why? The U.S. debt nearly tripled during that time period, from $5.9 trillion to $15 trillion. This increases the chance the U.S. will let the dollar's value slide, allowing it to repay the debt with cheaper money.

The economies of Japan and China are dependent on U.S. consumers. They know that if they sell their dollars, their products will cost more in the U.S., and their economies will suffer. Right now, it's still in their best interest to hold onto their dollar reserves.

China and Japan are selling more to other Asian countries, who are gradually becoming wealthier. However, the U.S. is still the best market in the world.

 

SIDEBAR:

Naomi Wolf’s 10 key steps to close down an open society: a dictator's blueprint:

1.       Invoke an internal and external threat 2. Secret prisons where torture takes place 3. Develop a paramilitary force 4. Surveil ordinary citizens 5. Infiltrate citizens' groups 6. Detain and release ordinary citizens 7. Target key individuals  8. Restrict the press 9. Recast criticism as espionage and dissent as treason 10. Subvert the rule of law…

 

 

The signs of collapse are everywhere…

 

However, there are many who believe we cannot, as a nation, default on our obligations…

The economies of Japan and China are dependent on U.S. consumers. They know that if they sell their dollars, their products will cost more in the U.S., and their economies will suffer. Right now, it's still in their best interest to hold onto their dollar reserves.

China and Japan are selling more to other Asian countries, who are gradually becoming wealthier. However, the U.S. is still the best market in the world so why ruin your best customer?

A sudden dollar collapse would create global economic turmoil as investors rush to other currencies, such as the euro, or other assets, such as gold and silver.

 

“There is never a risk of default for a sovereign nation that issues its own free-floating currency and where its debts are denominated in that currency.” Mike Norman, Chief Economist for John Thomas Financial

 

Technically, this is true but in reality, the US would simply reissue a new currency and perhaps force Americans to turn in their gold or mandate all retirement accounts be switched over to government securities.  There is already a plan in place.

 

Judging by the past few Presidential administrations, freedom and Democracy are on shaky grounds in the US…Anti-citizen laws such as the un-Patriot Act have destroyed privacy, restricted our right to travel, militarized our local police and worse. Americans should prepare for a just-in-case scenario – hold physical supplies of gold and silver and other hard assets such as mortgage-free land.

 

What would happen if the US did default?

http://www.depositaccounts.com/blog/what-happens-if-the-us-defaults-on-its-debt.html

 

Traits Common to Declining Cultures...

Obsession with beauty

Decline of the middle class

Increase of violence (primarily among young)

Decline of the family

Decline of morals

Increase of immorality and ethics among leaders

An insolvent government

Failure of its people to see the decline

A decline in literacy and education

Decline of a belief in a Supreme Being

 

Documentaries For Americans

As an independent thinker, I find it important to open your eyes and see the world for what it is. There are many disturbing things going on in this country, and when we try to discuss it, it becomes a ‘Us vs. Them’  kind of battle.

http://www.imdb.com/list/EMJJibS25wE/?ref_=ttqu_rls_3

 

 

 

 

A New Social Security Ponzi Scheme?

 

"Let's do more to help Americans save for retirement. Today, most workers don't have a pension. A Social Security check often isn't enough on its own. And while the stock market has doubled over the last five years, that doesn't help folks who don't have 401ks. That's why tomorrow I will direct the Treasury to create a new way for working Americans to start their own retirement savings: MyRA. It's a new savings bond that encourages folks to build a nest egg. MyRA guarantees a decent return with no risk of losing what you put in. And if this Congress wants to help, work with me to fix an upside-down tax code that gives big tax breaks to help the wealthy save, but does little to nothing for middle class Americans. Offer every American access to an automatic IRA on the job, so they can save at work just like everybody in this chamber can."

What are the differences between MyRA and Social Security? One difference is that MyRA will be voluntary — at least for now.

Another is that your MyRA account will have your name on it... although it is not too different from Social Security in that respect. Social Security does tell you how much you can expect to receive when you retire.

But there are also striking similarities between the proposed MyRA and Social Security. The main similarity is that the Treasury will take your money and spend all surplus funds.

For many decades, the government has spent the surplus money from Social Security. The government would collect Social Security taxes in excess of what it had to pay out in Social Security benefits, and the rest would be dumped into the general fund and spent.

There is no Social Security lockbox. There is a Social Security trust fund filled up with a bunch of IOUs from the government. Social Security holds more government debt than China.

This is how Bill Clinton was able to claim budget surpluses in the late 1990s. The government was still running a deficit, but the surplus funds from Social Security were enough to cover it. It has all been an accounting gimmick.

But with the major recession that began in 2008 came smaller than expected tax collections. In addition, we have seen the start of baby boomers hitting retirement age.

So in the last few years, we have seen an end to Social Security surpluses. And as Social Security goes further into deficit, the government is desperate for new funds...

What better way than to start a whole new Social Security-like Ponzi scheme?

Now the government can get more money for the Treasury to spend and write more IOUs. This time, the IOUs will be held by individual investors in their MyRA accounts instead of the Social Security trust fund.

As most of us have learned, government cannot be trusted to be good stewards of public monies and resources…

 

Until the next revolution,

Bruce ‘the Poor Man’

 

The Poor Man has been educating Americans about the systematic plundering of their resources and way of life and what they can do about it since 1999. Our Mission: To protect and promote your freedom, civil rights, financial well being and overall self reliance in these turbulent times.     

Encourage your fellow Americans to wake up and smell the country. Share our resources!

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When in Doubt-Sue, Our National Motto! Learn How to Protect Yourself

When in Doubt-Sue…America’s favorite pastime!

 

Basic asset-protection tools to consider…protect yourself now.

Does everyone in America have a lawyer on speed dial?

As I write this a little league coach in CA is suing a 14-year old over an incident of the child’s helmet hitting the coach’s foot…you know something, it’s a sport, get out of coaching if you’re a dimwit.

McDonald's is being sued again by a California woman who claims she was scalded by their hot coffee. In 1990, a New Mexico woman was awarded $2.9 million in a hot-coffee lawsuit against McDonald's; the award was later reduced to about $500,000. Meanwhile, a continent away, a New Jersey woman is suing a real estate developer for not disclosing the presence of a 'bad' neighbor when she purchased a house.

In any other place, these cases might seem odd. But America is the world's most litigious nation by far. The legal site eLocal Lawyer states that 15 million civil suits are filed every year; approximately 55% are decided in favor of the plaintiff. Those statistics do not count the many disputes that are settled before a filing occurs or criminal cases. According to the American Bar Association, there were 1,244,120 attorneys who were actively practicing in 2012; the American population is approximately 313 million.

We’re the only nation which doesn’t have Tort Reform in place because the ABA is such a powerful lobby and so many in Congress are lawyers and we have more lawyers per square mile than any other country.  It’s been reported that all these lawsuits cost us on average 25% more for consumer goods.

 

 

 

Class action lawsuits are a sick joke for most plaintiffs-the lawyers get rich first, then the plaintiff might get a few cents of any settlement.  This happened with the Asbestos class action suit and in the case of the suit by the 50 states against Big Tobacco – nearly all those lawyers retired wealthy while states ripped off the public with its misuse of the proceeds (they had all promised the money would go to education and only ONE state lived up to that promise…then nearly every state and the feds raised tobacco taxes several times, profiting from their engineered greed)!

 

America's runaway litigation threatens both individual freedom and the harmony of society. The most consistent risk factor for being sued is wealth, or what is called the “Deep Pocket Theory.” The more assets an entity or person has, the greater the chance of being sued.

No one argues against a lawsuit that seeks reasonable awards for a genuine harm. But the mass of litigation in America today has moved well beyond reasonable, well beyond genuine.

The United States will not become less litigious in the near future (NOTE:  Always a good idea to make yourself judgment-proof if you own a lot of assets). A growing number of people make excellent money through filing suits against others.

At one time I was an elected official and when the ADA (Americans with Disabilities Act) became law, I attended a seminar which introduced us to the pitfalls of frivolous lawsuits which would result from this law…and they did.  There was a ‘professional plaintiff’ in one state that spent his days eating at various restaurants and measuring ramp inclines and other ‘safety challenges for the handicapped’ and his legal partner would sue if the eatery was so much as a half-inch off the proper incline.  Most places settled out of court.  He and his lawyer made a fortune.

It is not merely plaintiffs or lawyers who use the courts to get a pay check. The New York Times (Nov. 14, 2010) reported, “Large banks, hedge funds and private investors hungry for new and lucrative opportunities are bankrolling other people’s lawsuits, pumping hundreds of millions of dollars into medical malpractice claims, divorce battles and class actions against corporations — all in the hope of sharing in the potential winnings.” Using the 2010 public records of one state alone (New York), the Times estimated that “more than 250 law firms borrowed on pending cases, often repeatedly” during the last decade.

You might enjoy Bill Rounds’ (a CA attorney) insight on avoiding lawsuits and these other resources:

http://www.howtovanish.com/2011/11/stop-frivolous-lawsuits-before-they-start/

 

 

http://www.legalreform-now.org/menu3_3.htm

 

http://www.saclaw.lib.ca.us/pages/judgment-proof.aspx

 

http://wealthpilgrim.com/steps-to-protect-your-assets/

 

 

Somewhat controversial but a ton of information you can use…everything from how the government violates its own Privacy Act of 1974 to your Land Rights, Property Rights and links to publications this humble author has written for in protecting privacy rights.

http://famguardian.org/Subjects/PropertyPrivacy/PropertyPrivacy.htm

 

Pick up a copy of this free PDF – About SSN & TIN’s on Government Documents

You’ll find many other useable reports here too on protecting your privacy!

http://www.poormansurvival.com/Pages/articlesii.aspx

 

 

Everyone Needs Asset Protection Now

It's no wonder asset protection has become a respected, booming business. With tighter bankruptcy laws on the books and few signs frivolous lawsuits are being reined in, larger and larger numbers of real-estate investors, doctors, families, and business owners are seeking shelter from threats to their assets.
 

Some protection strategies include:
 

Dropping money into retirement accounts. Congress made them off-limits to most creditors and lawsuits.
 

A number of U.S. states are rivaling offshore havens with less-expensive trusts. Alaska, Delaware, Rhode Island, Nevada, and South Dakota are excellent starting points (and you don't have to be a legal resident to set one up.) U.S.-based trusts cost about half the amount it takes to set them up abroad. While domestic trusts haven't yet been fully tested by the courts, they are still a complicating factor to those pursuing frivolous lawsuits.
 

Umbrella insurance protects assets from personal injury and other claims by extending coverage beyond all the limits of your other insurance. And it's dirt cheap because umbrella policies only kick in after the claims on your other insurance policies have been exhausted.  I used an excess umbrella policy when I owned my publishing firm (and placed the title to our primary home into my wife’s name –that was a personal mistake-)…at the time, this was cheaper than an ‘errors and omissions policy’ that most publishers purchased.
 

Be wary of putting gold, diamonds, cash, etc. in a personal safe deposit box at your bank. (Actually, we're a bit wary of putting gold in a safe deposit box at all, for reasons detailed elsewhere.) Upon the death of the box's holder, it automatically gets sealed for purposes of probate and tax liability review. Use a corporate safe deposit box instead – people die, but corporations with multiple trusted key holders don't.
 

Take advantage of state exemptions from lawsuits and creditors. In states such as Florida and Texas you can sink your assets into building improvements or even pay off your home's mortgage. Other protected assets include life insurance and retirement plans.
 

"Equity stripping" involves loading up a property with debt to make it less attractive to legal predators. You could, for example, take out a loan against your vacation home and place the proceeds into an unattachable instrument, such as an insurance policy or annuity. (Don't forget, you eventually have to pay that loan back!)
 

In today's complicated legal and regulatory environment, common-sense asset protection is a fundamental building block of smart living.

 

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