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This Global Collapse Will Be Unlike Anything In Recorded History
30
August, 2015
John Ing: “I am focused on the ramifications of the
Chinese devaluation. There is a lot of misinformation about
this move but the reality and the point of the exercise is a product
of the ongoing race to the bottom as far as currencies. All of
this is a result of unprecedented worldwide quantitative easing and
liquidity….
“Central
planners feel bold because there have been not yet been any major
consequences other than roaring stock markets. The dollar is
still the reserve currency of the world. However, many
currencies are locked to it and those countries are having
difficulties. Therefore, they are resorting to these
devaluations in order to protect their economies.
The
last country to participate, and that will be soon, will be the
United States. So when you look at the ripple effect, what the
Chinese are doing is very strategic. This is all part of a
reserve currency plan. They already have a reserve currency and
reserve swaps with 28 other countries. But what the Chinese
want is for their currency to become like the euro and the yen.
So the IMF discussions are also very important to China.
But
the other important point is that the Chinese have something on the
order of $4 trillion of foreign exchange reserves, of which more than
$1 trillion is in U.S. Treasuries. The Chinese have devalued
their currency because they have more than $1 trillion worth of
obligations. There are two ways for them to pay those long-term
obligations. One is to run down their foreign exchange
reserves. So they chose to devalue.
Expect
Even Greater Fireworks In September And October
In
the process they have been drawing down their foreign exchange
reserves by $400 billion. At the same time the Chinese have
been dumping U.S. Treasuries. This has put pressure on yields.
The market reaction this week has been to experience
enormous destabilizing volatility, and this should lead to even
greater fireworks as the markets head into September and October.
This
Global Collapse Will Be Unlike Anything In Recorded History
KWN
note: Meanwhile, in the United States it’s business as usual
(see chart below).
One
Hell Of A Collapse
King
World News note continues: You can see from the chart above
that despite the hiccup in 2008 – 2009, the central planners are
determined to continue inflating the global Ponzi debt scheme.
The problem is that everything eventually hits the wall. The
recent turmoil in global markets suggests that the ability of the
world to sustain such massive debt levels is coming to an end.
If so, the Total Credit Market vs Share of GDP is in
for one hell of a collapse.
If
you look at a simple reversion to the mean (the median point from the
years 1840 – 1980), that would suggest a collapse from the current
level (over 350%) to under 150%. That will be a much larger
credit implosion than the one that triggered the Great
Depression. Buckle up and buy physical gold because it will be
a terrifying ride as holders of paper assets such as stocks and
bonds get destroyed and the recent chaos in global markets
is seen as just a warm-up.
Massive
Starvation During The Last Great Depression
Russian
researcher, Boris Borisov, in his article titled “The American
Famine” estimated the victims of the financial crisis in the US at
over seven million people. The researcher also directly compared the
US events of 1932-1933 with Holodomor, or Famine, in the USSR during
1932-1933.
In
the article, Borisov used the official data of the US Census Bureau.
Having revised the number of the US population, birth and date rates,
immigration and emigration, the researcher came to conclusion that
the United States lost over seven million people during the famine of
1932-1933.
“According
to the US statistics, the US lost not less than 8 million 553
thousand people from 1931 to 1940. Afterwards, population growth
indices change twice instantly exactly between 1930-1931: the indices
drop and stay on the same level for ten years. There can no
explanation to this phenomenon found in the extensive text of the
report by the US Department of Commerce “Statistical Abstract of
the United States,” the author wrote.
The
researcher points out the movement of population at this point: “A
lot more people left the country than arrived during the 1930s –
the difference is estimated at 93,309 people, whereas 2.960,782
people arrived in the country a decade earlier. Well, let’s correct
the number of total demographic losses in the USA during the 1930s by
3,054 people.”
Analyzing
the period of the Great Depression in the USA, the author notes a
remarkable similarity with events taking place in the USSR during the
1930s. He even introduced a new term for the USA – defarming – an
analogue to dispossession of wealthy farmers in the Soviet Union.
“Few people know about five million American farmers (about a
million families) whom banks ousted from them lands because of debts.
The US government did not provide them with land, work, social aid,
pension – nothing,” the article says.
“Every
sixth American farmer was affected by famine. People were forced to
leave their homes and go to nowhere without any money and any
property. They found themselves in the middle of nowhere enveloped in
massive unemployment, famine and gangsterism.”
The
then state of affairs in the US society can be seen in Peter
Jackson’s movie King Kong. The movie starts with scenes of the
Great Depression and tells the story of an actress who did not eat
for three days and tried to steal an apple from a street vendor.
There is food in the city, but many people had no money to buy it in
unemployment-paralyzed New York. People starve in the streets against
the background of stores selling a variety of foodstuffs.
At
the same time, the US government tried to get rid of redundant
foodstuffs, which vendors could not sell. Market rules were observed
strictly: unsold goods should always be categorized as redundant and
they could not be given away to the poor because it could cause
damage to businesses. A variety of methods was used to destroy
redundant food. They burnt crops, drowned them in the ocean or plowed
10 million hectares of harvesting fields. “About 6.5 million pigs
were killed at that time,” the researcher wrote.
The
consequences of those policies were predictable, the author of the
article wrote. “Here is what a child recollected about those years:
“We changed our usual food for something for available. We used to
eat bush leaves instead of cabbage. We ate frogs too. My mother and
my older sister died during a year.” (Jack Griffin).”
So-called
public works introduced by President Roosevelt became a salvation for
a huge number of jobless and landless Americans. However, the
salvation was only a phantom, Boris Borisov wrote. The works
conducted under the aegis of the Public Works Administration and the
Civil Works Administration were about building channels, roads or
bridges in remote, wild and dangerous territories. Up to 3.3 million
people were involved in those works at a time, whereas the total
number of people amounted to 8.5 million, not to count prisoners.
“Conditions
and death rate at those works are to be studied separately. A member
of public works would make $30, and pay $25 of taxes from this
amount. So a person could make only $5 for a month of hard work in
malarial swamps.”
The
conditions, under which people were working for food, could be
compared to Stalin’s GULAG camp.
“The
Public Works Administration (PWA) bore a striking resemblance to
GULAG. The PWA was chaired by “American Beria,” the Secretary of
Interior Affairs, Harold Ickes, who threw about two million people
into camps for the unemployed youth,” Borisov wrote. “Harold
LeClair Ickes (1874–1952) later interned USA’s ethnic Japanese in
concentration camps. The first stage of the operation took only 72
hours (1941-1942).
“In
1940, the US population was supposed to make up at least 141.856
million people upon the preservation of previous demographic trends.
As a matter of fact, the USA had the 131.409-strong population in
1940, of which only 3.054 million can be explained with changes in
migration dynamics. Thus, 7.394,000 people simply do not exist as of
1940. There are no official arguments to explain the phenomenon,”
Boris Borisov wrote.
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