Today Real Consumer Price Inflation is nearly 12% annualized, Real U.S. GDP is dropping at an annual rate of about 2%, and M3 is now increasing at an annual rate of nearly 18% - - a doubling time of about 4 years, according to shadowstats.com. Yes, we are having a deflation in housing. California is down 24% from the top. But if you figure in at least 12% inflation that's a 36% drop in real value. But inflation measured in terms of food, clothing, and fuel is roaring --- things you actually need to live. Since most people bought their houses at higher prices, both the deflation and inflation mean only one thing to the bottom line --- impoverishment. What you own is loosing value, and what you don't have but need is getting more expensive. And you say that the U.S. gov doesn't have a spirit of stupidity?
Critical Economic Data
Isaiah 19:11 Surely the princes of Zoan [Washington D.C.] are fools, the counsel of the wise counsellors of Pharaoh [Ben Bernanke] is become brutish: how say ye unto Pharaoh [Bush], I am the son of the wise, the son of ancient kings [Bush]? 12 Where are they? where are thy wise men? and let them tell thee now, and let them know what the LORD of hosts hath purposed upon Egypt [America]. 13 The princes of Zoan [Chicago Board of Trade] are become fools, the princes of Noph [Wall Street] are deceived; they have also seduced Egypt [America], even they that are the stay of the tribes thereof. 14 The LORD hath mingled a perverse spirit in the midst thereof: and they have caused Egypt [America] to err in every work thereof, as a drunken man staggereth in his vomit.
Notice that the real inflation rate is 12% and not the government 'reported' lie of 4%. At 12%, $1000 becomes:
| Years | 1000 | 120 |
| 1 | 880 | 105.6 |
| 2 | 774.4 | 92.928 |
| 3 | 681.472 | 81.77664 |
| 4 | 599.6954 | 71.96344 |
| 5 | 527.7319 | 63.32783 |
| 6 | 464.4041 | 55.72849 |
| 7 | 408.6756 | 49.04107 |
| 8 | 359.6345 | 43.15614 |
| 9 | 316.4784 | 37.97741 |
| 10 | 278.501 | 33.42012 |
From Martin Weiss. Other sources have the rate at 13% now. The M3 money supply is growing at 15%+, so you know what's down the road.
From The Elliot Wave International. The current dow price in gold at 900/ounce and 12000 DJIA is: 13.3. The reason that people don't see the crash is that that nominal prices are lies due to inflation. In 1929, the relation between our currency and gold was much tighter. That's why the crash was noticed, then, but why the government can now pretend that it isn't happening.
This time period (2000-2008) is equivalent to 1929-1932. Remember that the real depression only hit after 1932. Notice that in 1980 you could buy the whole dow jones for 1 ounce of gold? At some point the dow may again be bought for an ounce of gold -- it is headed in that direction.
If we consider the NASDAQ market, then the crash is even worse. At the top of the tech bubble it was over 5000! It is not even close to its nominal high. If you adjust it for inflation, the chart will look worse than the dow.
The real unemployment rate is 13% and not 5%. This was confirmed by the Michael Savage's talk show substitute Peter Wiseback on 4/9/2008.
The Price of Rice. This is not a commodity bubble (i.e. an artificially speculatively high price). It is a genuine shortage combined with worldwide monetary debasement.
The Price of Silver, or the price of real money. The silver price should be much higher, but it won't be as long as the silver crooks keep suckering investors into buying paper promises to own silver. When the shortage finally comes, only those who have physical possession will benefit, and everyone else will realize that their paper investment only failed to stimulate demand and allowed industry to squander the remaining physical supply -- that's what happens when you let borrowed money short the market: you end up with a crash and then the shortage that was covered up becomes apparent.
The price of silver dropped in March, but is now coming back. The silver price is a charade, since unlike other commodities those who think they are investing in them fail to take delivery of their product. This allows the shorts to manipulate the price by selling silver that does not exist, knowing that investors will settle for cash and not delivery. This makes the silver market a gambling game with bank notes and paper promises. The connection with actual silver is not very great.
The gold market is similarly manipulated. Other commodities are manipulated too, but only to a very small percentage of the supply, and hence its effect on price is very limited, because gamblers cannot depress the price by selling product that doesn't exist when there is a shortage and everyone wants delivery.
The price of corn. Corn topped $6/bushel a few days ago. That's what happens when you try to take a food crop and turn it into bio-fuel. Corn is higher that $6 now.
| Rough Calculation | |||
| $1000 invested in 2 year T-Bill at 1.75% | |||
| with 12% inflation rate. | |||
| Time | Nominal Value | After 12 % Inflation | |
| 0 Years | 1000 | 0 | |
| 1 Year | 1017.5 | 895.4 | |
| 2 Years | 1035.30625 | 786.8328 | |
| Loss | ($213.17) | ||
| Annualized % loss. | -10.66% | ||
This is what will happen if you invest in government debt, i.e. treasury bills. Who would be stupid enough to do that? Apparently a lot of people believe in government lies.
If you take the interest rate that the Federal Reserve is charging Banks to borrow money and adjust it for inflation, you will see that the fed is paying the Banks to borrow money. In other words, real interest rates for the BIG BANKS are negative. They are not only getting free money, they are being paid to borrow it!
The rest of America is like the proverbial frog being boiled to death slowly in a frying pan.
Photo: Martin Weiss Newsletter.
Various Inflation Measures:
Imports = up 14.8% (that because the gov can't lie about this statistic with hedonic adjustments!)
CPI = up 4%. (but it is really 13%, because the gov cooks the books on this one.)
PPI = up 7%. (books cooked here too, but to a lesser extent).