Maurizio Blondet 19 Luglio 2008

Crowds of lined up USA citizens waiting to empy their bank accounts are facing a new 1929 : Wall Street collapsing today is not a black and white fading picture but a bright coloured one, the only difference is. Well-established financial institutions oxygen-tent therapy is needed.

Step one : paper assets losing their value because of the speculative crack are side-affecting commecial banks - step two - and real economy as well : factories are closing down, mass kickouts all around, middle class chain-insolvent-reaction and consumption's free fall - and this is step three.

British Police, in an attempt to help jobless and scholarshipless youth - the most delinquency prone - doing social and public utility works, seriously called for a new "national service", as in the year 1945.

This is nothing but step four : Roosvelt himself, during the thirties, kept in the ranks millions of jobless to make them busy doing public works.

Rationing could be step five, along with a food-ticket-based planned economy taking famine into account : tot grams of fat, protein, meal and so on, each.

Kind of a replay, a bad one indeed, with crude and foods prices skyrocketed in spite of actual stagflation, while they were at the lowest - deflation - after the year '29. And even worse than in the '29, the world empire very heart is now mindless  with a disctredited, leaving, driveless and powerless president, having the next one taking office a bunch of long months far from now.

To make it short, the very same foolish and insatiable greed, the very same unruled capitalism, do generate the very same downfall. And the very same lies as well, sa va sans dire.

US savers standing in front of their banks are told by the mainstream media over and over again that there is nothing to be scared of, 'cause they got a government deposit insurance. Yes, they have one, and it comes from the FDIC : the Federal Deposit Incurance Co.. FDIC will positively pay you up to 100 thousand bucks, if your bank's insolvency is the case. Regrettably enough, FDIC availability does not exceed 52.8 billion bucks, 8 of them being already vanished just in helping one bank : the IndyMac. Banks expected to go insolvent within the next few months are between 150 and 300 and at least a figure of 90, according to forced optimistic official FDIC evaluations. The FDIC will fund just six or seven banks out of them all.

The Telegraph funereally euphoric suggests, "50 ways to take advantage of a sad times economy" : buy a Mercedes 2,000 bucks off the price! British Airways is summer selling-off long range flights, with an extra resort and car rent discount off the prices! Desperately looking for cash banks and housebuilders are offering 6.45 per cent accounts and 7.5% interest bonds! Those are insolvency-coming-soon interest rates, aren't they ? (1) Would you trust them ? And what about your iron-mike-nervous-system?  Ain't this funereal euphoria nothing but a 1929 replica ?

The fact is no doubt revealing :  it tells us that money cost, in spite of  Central Banks'  "cash injections" and Federal Reserve's primary rate lowered down to 2.5%, is unbelievably high and you will be asked a loan as high as at least a 7- 8% interest rate.

Easy credit, the happy financial bubbles chained-popping-up ground zero, is pulled down. Once upon a time, cash was flowing, all of a sudden it is finished, drained. Both american and european Central Banks were cash-flooding banks and hedge funds as well. This impressive money amount should freely move within the system, having an inflactive effect on one hand and oiling the great rollercoaster wheels, on the other. The rollercoaster is flat, squeaking and stopped, now

Where the hell is that cash-stream recovered ?  Banks is the answer. Banks do hold that money not to lend it, but just to fix losses, actual and future ones and this is the way we get an unexpected, umbelievable end : all this huge amount of money and assets ( ranging from M1 to M4 ), both in USA and in Europe is not increasing, it is decreasing. This is a deflation signal, while raising good's prices is an inflation mark.

" If Central Banks will overreact to crude and corn inflative - Evans-Pritchards states - they will fire a terrifying chain reaction . " Roughly said : they will speed up deflation and make a Great Depression replica to happen (2).

ECB chief, Claude Trichet -  needless to say - is going straight that way.  Raising prices misunderstood ( with crude absolutely out of his hands ), he choose to fight inflation - a non-existing inflation, monetary speaking - keeping interest rates high.

" 4.5% interest rate is "irresponsible ", according to Zapatero, as it forces Spanish economy - 20% of it housebuilding based, 1 million unsold houses because of high rates loans - to recession.

Pig-headed Trichet european through American Treasure bonds rates spread constantly high, ends up in just one simple plain thing :  hot bucks streams are escaping from US low-rate-liquefying-dollar and do easily find euro as a rescuer and the euro becomes "strong", umbelievably  strong. As a side effect, we have a choked european export and, finally, a Titanicing - the ship, lol - Europe before USA.

The good news : within the next two years, speculation will leave a supposed to be an average 20 to 30% overvalued euro; at that time it will become "weak" again - as real european economy already is - and it will be restored as competitive; if we will still be alive, I mean.

At that very time, the US dollar will no longer be the global reserve currency and ain't China and Japan giants like - having mountains of bucks - eager for buying 20% off price discounted Armani ties, will they ? We will be competitive - no doubt - in a frozen market, though.

Trichet raising crude attempt in taming is much more lowering european real wages than gas price, if past years inflative erosion was not enough. In order to calm down gas price, we have no money to buy it and we are loosing our jobs as well. This is as unhuman as a banker-bureaucrat-style option.

As in the year 1929, the Depression instead of Recession awareness lately awakens.

Eminent eurocrat and The Times opinion maker Sir William Rees-Mogg, he recently dares to write the word (3). Spending a long liberal lier life, at the age of 80, he now allows himself to say the truth. For the first time a major paper ever, a powerful columnist - member of powerful circles as well - evokes The Great Depression.

The Dow Jones - Wall Street index - did reach pre-29 levels just a quarter of a century later, in the late 1954 - Rees-Mogg writes. If we are facing a replica, " stock market will see 2007 figures in the year 2032."

There will be 25 years of shortage : too much of a time for a single life; millions of lives will shift from youth to adulthood living in misery, with falling hopes and dead dreams. Worst of all, crack, chaos, millions of lives ruined, all planned by design, a suspect is.

The year 1994, David Rockefeller is speaking at the United Nations Business Council.. He says : " We are on the verge of global transformation. All we need is a major crisis, and the nations will accept the New World Order» (4).

Guess what ? Some former-president-former-CIA-chief, some dumb-and-dumber alcoholist at the White House in charge father of, some-one called George Bush senior, said over and over again right these days : " This trembling times will make our goal to happen : a New World Order. "

Did they plan everything ? Is everything by design ? Are they going to force us to accept this global order ?

by Maurizio Blondet

Translate by Massimo Frulla

Source > EFFEDIEFFE.com | July the 16th

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1) «50 ways to profit from the economic gloom», Telegraph, 11 luglio 2008.
2) Ambrose Evans-Pritchard, «Monetarists warn of crunch across Atlantic economies», Telegraph, 11 luglio 2008. «European recession looms as Spain crumbles», Telegraph, 15 luglio 2008.
3) Sir William Rees-Mogg, «This recession could easily tips into a depression», Times, 14 luglio 2008.
4) Citato da Pino Cabras, «Strategie per una Guerra mondiale», Cagliari 2008, pagina 65.