Why the financial economy will collapse, sooner or later. Notice I said financial, its not the worse thing that can happen. War is the worst thing. If we have leadership that understands economic fundamentals of sound money, gold, silver, we can recover relatively quickly.

Greece, which is a time bomb set to ignite the nuclear system itself, but seems to have been “forgotten about” where market participants are concerned. Their short term debt is trading at interest rates between 300-400%. They are flat assed broke and the market has already deemed them so.

The problem is twofold, first the market IS paying attention to because it is Euro negative (betting against the European Union) which temporarily points the finger away from the U.S.

The fact that there is a crisis in Europe has postponed our troubles temporary, take advantage of this time, it will not last long.

If Greece really does “technically” default, the Eurozone is toast which it is anyway with Portugal, Italy, Ireland, Greece, and Spain, (PIIGS) they will all default. The Euro was clearly not well thought out politically or financially.

The first problem is one of moral hazard. Moral hazard happens when an individual or institution does not take the full consequences and responsibilities of its actions, and therefore has a tendency to act less carefully than it otherwise would, leaving another party (in this case the more fiscally responsible members of the European Union) to hold some responsibility for the consequences of those actions. Some countries politicians recognized that because the EU agreement backing up the debt of individual countries they could borrow much more money than previously. The PIIGS countries took full advantage, running up huge debt in the hopes that the European Central Bank (ECB) would be forced to print money and bail them out. Printing money by the ECB would essential spread the bail out over every single member of the EU in the form of inflation. Essentially everyone would be punished for the behavior of irresponsible politicians.

In the original inception countries were suppose to keep debt under 60% of GDP and no more than 3% per year. Greece-160%, Italy-121%, Germany-85%. The PIIGS simply could not control themselves and loaded up on debt. People need to understand that politicians are just as greedy as capitalist. When you put a pile of money in front of them they will consume the money to buy votes and pay off constituents.

Secondly and most importantly, which of course is not getting much press are all the Credit Default Swaps (CDS) insurance that has been sold. Greece CANNOT be allowed to technically default and trigger the “insurance” payouts. If this was happen, there could be 5, 10, 20 defaults by “insurers” just like AIG who could not pay.

If the CDS are not triggered …it should have already triggered at least 10 months ago during the first bailout… then the owners of CDS, many who have “hedged” their portfolios with this bogus insurance will not be paid. Many institutions will become insolvent …as if they are not already… by the simple fact that they own Greek debt that has dropped already 80+% in value with no compensation on the other side where they expected their CDS “insurance” to pay.

CDS CANNOT pay.

For that matter, how funny is it that the U.S. which is the reserve currency, has CDS in the $Trillions written against debt.

Greece alone will blow the system. Look at the U.S. … exponential overkill. The “writers” of Greek CDS do not have the capital to pay on a default and the suckers who relied on the CDS payments need them to be made whole. Without these payments they are bankrupt.

What this means is that everyone in this game has closed their eyes, taken a good long look into the abyss, and realize that in a few short weeks it will all be over for them. Bankruptcy, unemployment, ruin.

This is just one more black and white example as to why “mathematically” it is over and has been since late 2008 when central banks and treasuries decided to borrow, print and “save the world” for the time being.

How long is “the time being”?

All the central banks did was make the crash we will soon experience that much worse.

Why is it going to be worse?

Because our federal government have accumulated massive debt in that time. Our politicians have misallocated resources on unproductive government work scams like 19th century rail roads we do not need, corruption, bail out of bankrupt states, bail out of insolvent zombie banks that will go bankrupt again, artificially supported housing prices, not liquidating remaining housing stocks, fighting wars, and making the suffering much worse in the long run.

American corporations have approximately 20% market share exposure to the EU. It is not a small problem “over there.”

The only correct move for those playing the game today is not to play the game.

Note from a Texan:
“Friends, I’ve heard it said that Rick Perry’s biggest problem is that he’s never felt any burning desire to be President. From my viewpoint, that’s not a problem, it’s an ASSET!

Here in Texas we know for a fact that he had to be talked into running, because he really wasn’t interested. I’m not sure how that was accomplished, I only know that it took months to get it done. The best recommendation I can imagine for President is for a man to feel called to service which he does not desire, and to accept that call. Wasn’t that the situation with George Washington, on each and every occasion when his country reached out to him for leadership?

Whether Perry would make a good President is unknown at this time, but the same is true for every other candidate. One thing is obvious, Barrack Obama is not a good President, nor do I see any way he could ever become one. His entire mindset is Un-American if not ANTI-American! That will not change in a second term…”

George

by Rick Perry

Hard Truths Behind Today’s Job Numbers

New jobs and unemployment figures came out today, which on their face depict an economy that looks better than many pessimists had anticipated. Understandably, they are being greeted as welcome news from a public desperate for job growth and economic recovery, and an end to the hardship, pain and misery that so many Americans have experienced over the last few years.

But while I am all for good news, a couple of hard truths must be told as these numbers are scrutinized today.

First, the U.S. workforce is not nearly the same size as it was when President Obama took office, let alone this time five years ago. According to AEI’s James Pethokoukis, “If the size of the U.S. labor force was as large as it was when Barack Obama took office, the unemployment rate would be 10.9 percent. But since so many people have gotten discouraged and stopped looking for work– and thus disappeared by government statisticians — the jobless number has been artificially depressed. A better gauge of the jobs picture is the broader U-6 rate, which includes part-timers who would rather have full-time jobs. It stands at a whopping 15.2 percent.”

As Pethokoukis notes in his post, pointing to data highlighted by Hamilton Place Strategies, further scrutiny of other numbers, like labor force participation, results in an even less rosy picture: “Labor force participation averaged 66 percent through most of the 2000s. It now stands at 64 percent after declining again last month. If more people were still looking for jobs, and the participation rate were back up at 66 percent, the unemployment rate would now be 11.4 percent instead of 8.6 percent.”

Second, according to Betsey Stevenson, a former Chief Economist at Obama’s own Department of Labor, people with education at or below the high school level are still losing jobs, while the only job growth that we are seeing is among better-educated workers. Earlier today, she tweeted, “All the gain in empt in this report was for those w/ educ–loss of 204K jobs for high school & below, gain of 301K for some college & above.” This should be a real concern, moving forward.

The big truth here is that we need to do better, and we’ve needed to be doing better, for a long time now. It will not surprise me if the Obama Administration and his political advisers start trumpeting these numbers as proof that their policies have worked to get the country out of the mess that bad policy created and exacerbated. But the truth is, they could and should have pursued a different economic approach that would have gotten the economy moving much faster, and created more jobs for all kinds of workers faster. They had an example in my state, Texas.

In Texas, we have consistently followed a few basic, common sense principles where economic policy is concerned. First, don’t spend all the money. Second, keep taxes low. Third, keep regulations in check. On my watch, the state has seen the addition of one million net new jobs, while the rest of the country lost two million. These jobs cut across industries, too: Some were in the energy field (oil and gas, but also wind power), some were in the tech sector (as anyone who has visited Austin recently could guess), some have been in the service sector, and so on. We’ve created jobs for high-skilled workers, unskilled workers and everyone in between.

We have also gotten more people into the labor force, while the country as a whole has seen a decline. From November 2010 to November 2011, Texas added 168,500 people to the labor force. From just October 2011 to November 2011, we added over 20,000 new workers; in the other 49 states, close to 150,000 dropped out.

America needs to start implementing policies we know will work based on experience. We can do this. We just need the right leadership, and the courage to end the statistical shell games that Washington uses to hide the truth from the American people.

As a citizen of California immigration is an important subject here in the state.
Having grown up during the “Bracero Program” that actually worked here in the state. I know there is a better way of managing the work force needed in the agricultural complex.

This program allowed a Mexican laborer to enter the United States and work for a limited period of time. These laborers did not have to worry about sneaking across the border and when their work was done they were free to take their money and go home. California was not the only state that benefited from this program.

Since Newt Gingrich appears to be gaining favor again in the polls I thought I would post some of his views on Immigration. This collection came from On The Issues. They have a collection from of the candidates running for 2012.

Review all illegal aliens & if you have no ties, go home
Q: Back in the ’80s, you voted for legislation that had a pathway to citizenship for illegal immigrants. Some called it amnesty then; they still call it amnesty now. What would you do if you were President, with these millions of illegal immigrants, many of whom have been in this country for a long time?
GINGRICH: Let me start and just say I think that we ought to have an H-1 visa that goes with every graduate degree in math, science and engineering so that people stay here. I did vote for the Simpson-Mazzoli Act. I believe ultimately you have to find some system that reviews the people who are here. If you’ve come here recently, you have no ties to this country, you ought to go home. If you’ve been here 25 years and you got three kids and two grandkids, you’ve been paying taxes and obeying the law, you belong to a local church, I don’t think we’re going to separate you from your family, uproot you forcefully and kick you out.
Source: 2011 CNN National Security GOP primary debate , Nov 22, 2011

Illegal aliens born in the US should not be deported
BACHMANN [to Gingrich]: I don’t agree that you would give the DREAM Act on a federal level. And I don’t agree that we should make 11 million workers who are here illegally legal.
GINGRICH: First of all, in the DREAM Act, the one part that I like is the one which allows people who came here with their parents to join the US military, which they could have done if they were back home, and if they serve on it with the US military to acquire citizenship, which is something any foreigner can do. And I don’t see any reason to punish somebody who came here at three years of age, but who wants to serve the United States of America. I specifically did not say we’d make the 11 million people legal. If you find people who have been here 25 years and have two generations of family and have been paying taxes and are in a local church, as somebody who believes strongly in family, you’ll have a hard time explaining why that particular subset is being broken up and forced to leave.
Source: 2011 CNN National Security GOP primary debate , Nov 22, 2011

Sue the federal government for every cent spent on illegals
We have technology that allows you to track a package with FedEx with remarkable accuracy. One of my proposals is to send people a package to determine if they are here illegally. It’s funny but making a point about where we are. We should be able to identify everyone who gets emergency aid and every state should sue the federal government every year for every cent spent on illegals who should not be in the United States. That is the federal government’s responsibility.
Source: Head-to-head debate between Herman Cain & Newt Gingrich , Nov 5, 2011

Employers should use e-verify for all hires
Q: Should we make all businesses use E-Verify, a government database, to check whether or not new hires are illegal? Or would that turn small businessmen into immigration agents?
GINGRICH: Well, let me say, first of all, I think we would be better off to outsource E-Verify to American Express, MasterCard or Visa, because they actually know how to run a program like that without massive fraud. Second, the program should be as easy as swiping your credit card when you buy gasoline. And so I would ask of employers, what is it you would object to in helping the US in dealing with the problem involving illegal immigration?

Q: Would you support each state enforcing the immigration laws since the federal government is not?

GINGRICH: I strongly favor 100% control of the border, and I strongly favor English as the official language of government. I favor modernizing the legal visa system. We have a terribly antiquated legal system while our border is too open for people who are illegal.
Source: 2011 GOP Google debate in Orlando FL , Sep 22, 2011

Require official English plus American history
We should make English the official language of government. We should insist that first-generation immigrants who come here learn American history in order to become citizens. And then find a way to deal with folks who are already here, some of whom, frankly, have been here 25 years, are married with kids, live in our local neighborhood, go to our church. It’s got to be done in a much more humane way than thinking that to automatically deport millions of people
Source: 2011 GOP debate in Simi Valley CA at the Reagan Library , Sep 7, 2011

I voted for Reagan’s legal guest worker program
Q: Your current perception on immigration reform is a little different on your initial positions under Reagan?
GINGRICH: I think we have to find a way to get to a country in which everybody who’s here is here legally. But you referenced Pres. Reagan. In 1986, I voted for the Simpson-Mazzoli Act, which in fact did grant some amnesty in return for promises. Pres. Reagan wrote in his diary that year that he signed the act because we were going to control the border and we were going to have an employer program where it was a legal guest worker program. That’s in his diary. I’m with Pres. Reagan. We ought to control the border, we ought to have a legal guest worker program. We ought to outsource it, frankly, to American Express, Visa, and MasterCard, so there’s no counterfeiting, which there will be with the federal government. We should be very tough on employers once you have that legal program.
Source: 2011 GOP debate in Simi Valley CA at the Reagan Library , Sep 7, 2011

Citizen Boards to decide which immigrants stay and go
Q: You’re looking at the idea of having citizen boards choose which illegal immigrants can stay in the country and which would have to go. Who decides the memberships of these boards, and how would they work?
A: I think it’s very important to go back and look at how the Selective Service Commission worked in World War II, because it was local, practical decision-making, and people genuinely thought it was fair and it was reasonable.

Q: What about Pres. Obama’s joke about protecting the borders wit alligators and a moat?

A: That was the perfect symbol of his failure as a leader. He failed to get any immigration reform through when he controlled the Senate. He could ram through Obamacare, but he couldn’t deal with immigration. I would be prepared to take as many people from Homeland Security’s bureaucracy in Washington and move them to Texas, Arizona and New Mexico, as are needed, to control the border. And we should have English as the official language of government.
Source: Iowa Straw Poll 2011 GOP debate in Ames Iowa , Aug 11, 2011

Use National Guard on US-Mexican border
Q: [to Cain]: If two adults came into this country illegally, and they have a child, should that child be considered a citizen of the US?
CAIN: I don’t believe so. But let’s look at solving the real problem, OK? #1, get serious about securing our borders. #2, enforce the laws that are already there. #3, promote a path to citizenship by cleaning up the bureaucracy.

GINGRICH: Herman Cain’s essentially right, you break it down. First of all, you control the border. We can ask the National Guard to go to Iraq. We ask the National Guard to go to Afghanistan. Somehow we would have done more for American security if we had had the National Guard on the border. If you don’t want to use the National Guard, take half of the current Department of Homeland Security bureaucracy in Washington, transplant it to Texas, Arizona, and New Mexico. You’ll have more than enough people to control the border.
Source: 2011 GOP primary debate in Manchester NH , Jun 13, 2011

Deport 55,000 illegal aliens with multiple arrest records
According to a report by the Government Accountability Office, our country has 55,322 criminal illegal aliens who have been arrested at least a total of 459,614 times, averaging about eight arrests per illegal alien. Twenty-six percent (about 15,000) have had eleven or more arrests. Imagine a government bureaucracy so incompetent it can’t even remove people from the United States when they have been arrested eleven or more times.
Source: Real Change, by Newt Gingrich, p. 29 , Dec 18, 2007

Elite immigration solution incompatible with American values
There is a clear path to an effective immigration solution that is better for America and better for immigration. The challenge is to get the elites to listen to the American people.
Unfortunately, the Washington elites have agreed on a definition of success that is infuriating to the average American. The elites on the left oppose border control, oppose English as the official government language, oppose expanding legal immigration, and want to find a way to allow everyone here illegally to stay, all while prohibiting illegal immigration in the future. The country is convinced that this so-called solution is incompatible with American values and will weaken America’s future.

In trying to force their left-wing solution on a country that rejects it, the elite have resorted to describing their critics as racist, xenophobic, unrealistic, and much worse. Those attacks are merely a sign of the elites’ desperation.
Source: Real Change, by Newt Gingrich, p.127 , Dec 18, 2007

Lax border security lets in terrorists
The American people overwhelmingly want to see their borders controlled as a matter of national security. By more than 7 to 1 (86% to 12%), Americas believe terrorists are trying to enter the United States illegally.
Most Americans understand the irrationality of intense security at airports and lax security at the borders. This requires the terrorist to be dumb enough that he insists on flying into the United States when he could simply ride a truck or walk into the country unimpeded. The refusal to control the border has been one of the most infuriating aspects of modern government, and one of the most inexcusable.

The American people want reform that establishes English as the official language of government, reform that controls the borders, reform that doesn’t reward illegality, reform that enforces penalties on employers.
Source: Real Change, by Newt Gingrich, p.132 , Dec 18, 2007

Immigrants must learn key values of American history
We must establish patriotic education for our children and patriotic immigration for new Americans. To achieve this, we will renew our commitment to education about American citizenship based on American history and an understanding of the Founding Fathers and the core values of American civilization. We will insist that both our children and immigrants learn the key values and key facts of American history as the foundation of their growth as citizens.
Source: Gingrich Communications website, www.newt.org , Dec 1, 2006

Make it harder to sneak in, BUT EASIER FOR GUEST WORKERS
No serious nation in the age of terror can afford to have wide-open borders with millions of illegal aliens crossing at will. But along with making it much harder to sneak in, we need to make it easier for guest workers to enter the country legally and to work here as long as they obey the law. Millions of illegal immigrants are here because Americans are hiring them. They have jobs in your neighborhood and you know it. Keeping these hard-working people illegal makes them vulnerable to criminals and keeps them from playing responsible roles in our communities.
We need a guest worker program to ensure that guest workers pay taxes, get driver’s licenses, buy auto insurance, abide by the law, and that filters out criminals and potential terrorists. The program should not be an automatic qualification for citizenship, though eventual citizenship should be held out as an opportunity.
Source: Gingrich Communications website, www.newt.org , Dec 1, 2006

1989: Let Tiananmen students overstay visas
Gingrich’s first skirmish was over foreign policy–Bush’s veto of a bill that would have allowed Chinese students to stay in the US after their visas expired. The brutal suppression of protesters in Beijing’s Tiananmen Square in 1989 had been seen across America. Chinese students’ lives were put at risk as soon as they returned home. Supported by Gingrich, Republicans joined Democrats in attempting to override the veto, and Bush administration officials began to be wary of the gadfly from Georgia.
Source: Newt!, by Dick Williams, p.124 , Jun 1, 1995

Irish and Chinese immigrants overcame bigotry; so can blacks
It is fashionable for African-Americans to argue that forced immigration in the form of slavery hardly is comparable to immigration. Gingrich instead uses the lessons of history to argue that time and change heal wounds. The problems that so anger black Americans, he insists, came to be after 1965–the year of the Voting Rights Act.
“From 1607 until 1965 you have certain long sweeps that are more and more positive. We go from slavery to segregation to integration. We go from empowering wealthy white males to eliminating the poll tax and then giving women the vote, then making sure everybody can vote. We go from almost the very beginning to acquire property. Free blacks as early as the 1740s could acquire property.”

Gingrich goes on to enumerate America’s past hostility toward the Irish, Southern Europeans, and the Chinese. These immigrants’ ability to overcome bigotry and succeed while so many black Americans languish is the prelude to the congressman’s call for dismantling the welfare system.
Source: Newt!, by Dick Williams, p. 30 , Jun 1, 1995

“One of the criticisms I make is to what I refer to as more of a libertarianish right. You know, the left has gone so far left and the right in some respects has gone so far right that they touch each other. They come around in the circle. This whole idea of personal autonomy, well I don’t think most conservatives hold that point of view. Some do. They have this idea that people should be left alone, be able to do whatever they want to do, government should keep our taxes down and keep our regulations low, that we shouldn’t get involved in the bedroom, we shouldn’t get involved in cultural issues. You know, people should do whatever they want. Well, that is not how traditional conservatives view the world and I think most conservatives understand that individuals can’t go it alone. That there is no such society that I am aware of, where we’ve had radical individualism and that it succeeds as a culture.”

Rick Santorum, in his book “A Senator Speaks Out on Life, Freedom and Responsibility

Just sayin a picture is worth a thousand words … LOL