Michael C. Ruppert
April 22, 2009, 7:30 PM PDT --
From The Wilderness' Peak Oil Blog
Even as the great corporate citizen Ali Velshi of CNN spews nonsense about a possible, imminent recovery; a new wave of foreclosures -- which FORBES attributes to a crumbling economy (No shit!) -- is about to make the first one look like a picnic. Nissan, Toyota and Honda are about to report losses. Japan is contemplating revising its GDP estimate downward to a negative 3%. Deflation is erupting in Europe... And poor Britain -- which is getting hammered at every turn -- has just reported the first drop in retail prices on High Street since 1960. (The death of snobbery. They actually had to lower the prices!)... Next year each Brit will pay an additional five thousand pounds in taxes while the government is about to begin en masse layoffs of civil servants. I am no fan of kings and princes. It's not the Royals I care about. There is too much Tom Paine in me. But I have this huge soft spot for the UK in my heart. In WWII my father was stationed in Bassingbourne with the 324th Squadron of the 91st Bomb Group (Heavy). He was a gunner and gunnery instructor in B17s. He was a hero. After emailing ahead I visited Bassingbourne in early May of 2005 and half the town turned out in authentic WWII U.S. and British regalia to welcome me. They had Tommy guns and heavy trucks, all spit shined and totally authentic. We occupied a pub where I had roast beef and Yorkshire pudding.
The WSJ is making a deal saying that China might actually be able to achieve 8% growth this year. Yeah right... The whole world is counting on China to grow and the dinos on Wall Street believe that China will then be able to buy more of our our debt.... Excuse me but if China were to achieve 8% growth in the face of Peak Oil the effects will be absolutely brutal here. With an aggregate global decline rate I estimate at between 7-9%, China's going to get all the oil it needs so it can grow and buy and lend to the rest of the world which is going to drop America like a hot rock. Oil prices will spike madly if the Chinese growth engine hits afterburner. A bad sign is that Chinese demand for new cars is up. But I'm not counting on China holding it together much longer. Maybe China and Ali Velshi are talking to each other... In either scenario we still have certain collapse.
Things are catching up here at home. As I predicted, GM is going under. A Chapter 11 filing will probably wipe out all of GMs dealers. According to U.S.A. Today the filing will instantly freeze GMs payments/reimbursements to dealers for already performed warranty repairs. By now that means shut-down time because there won't be any money to make payroll. And there's no money to lend to dealers while the FDIC is nearly insolvent as the list of "problem institutions" mushrooms. Chrysler looks to be pretty close behind.
No time to be shy now... Here's what's coming over -- I would estimate -- the next two years: FDIC insolvency; Treasury default, the dumping of the U.S. dollar as the world's reserve currency (I started predicting that in maybe 2002); hyperinflation; bankruptcy of the Federal Reserve; and collapse of the United States government as we know it. Federal Reserve notes are legal tender for all debts public and private. What does it mean if the privately-owned Fed goes bankrupt? Our map doesn't see that territory yet. -- Oh yes, and a new strain of swine flu has been discovered in humans in San Diego... And farmers are committing mass suicide in India and Africa because they can't pay the loans they used to grow their crops or they are being undercut by large corporations. I suspect that inflation is much more contagious than deflation. I don;t know how hard that stage will hit here. But deflation in any industrialized nation is like blood in the water. CoLLapse will looking like a feeding frenzy as the carcasses get stripped.
The good news: Las Vegas is decaying like the corpse it is. Last night I watched a Dan Rather special on how bad things are there. Ugly! And yet the Mayor was insisting that the answer was to build more and bigger hotels to bring the people back... I call that the Easter Island syndrome. If anything symbolizes the worst of the old paradigm it's Las Vegas. It has to die so that others around the country will start to grasp that what is happening here is not just a bump in the road.
I wrote a pretty good book and was the subject of what I suspect is going to be a pretty good movie: CoLLapse that can soften the end result of all this. I haven't seen any of the movie yet. But was all this work by so many people in the nick of time or too late? I am beginning to think we'll look back and say the former.
We'll start to find out on May 1st. The sales numbers will tell us everything as we watch them build over time. If we're strong out of the gate we have a huge advantage.
Hang tough and find something to hug.
MCR
Even as the great corporate citizen Ali Velshi of CNN spews nonsense about a possible, imminent recovery; a new wave of foreclosures -- which FORBES attributes to a crumbling economy (No shit!) -- is about to make the first one look like a picnic. Nissan, Toyota and Honda are about to report losses. Japan is contemplating revising its GDP estimate downward to a negative 3%. Deflation is erupting in Europe... And poor Britain -- which is getting hammered at every turn -- has just reported the first drop in retail prices on High Street since 1960. (The death of snobbery. They actually had to lower the prices!)... Next year each Brit will pay an additional five thousand pounds in taxes while the government is about to begin en masse layoffs of civil servants. I am no fan of kings and princes. It's not the Royals I care about. There is too much Tom Paine in me. But I have this huge soft spot for the UK in my heart. In WWII my father was stationed in Bassingbourne with the 324th Squadron of the 91st Bomb Group (Heavy). He was a gunner and gunnery instructor in B17s. He was a hero. After emailing ahead I visited Bassingbourne in early May of 2005 and half the town turned out in authentic WWII U.S. and British regalia to welcome me. They had Tommy guns and heavy trucks, all spit shined and totally authentic. We occupied a pub where I had roast beef and Yorkshire pudding.
The WSJ is making a deal saying that China might actually be able to achieve 8% growth this year. Yeah right... The whole world is counting on China to grow and the dinos on Wall Street believe that China will then be able to buy more of our our debt.... Excuse me but if China were to achieve 8% growth in the face of Peak Oil the effects will be absolutely brutal here. With an aggregate global decline rate I estimate at between 7-9%, China's going to get all the oil it needs so it can grow and buy and lend to the rest of the world which is going to drop America like a hot rock. Oil prices will spike madly if the Chinese growth engine hits afterburner. A bad sign is that Chinese demand for new cars is up. But I'm not counting on China holding it together much longer. Maybe China and Ali Velshi are talking to each other... In either scenario we still have certain collapse.
Things are catching up here at home. As I predicted, GM is going under. A Chapter 11 filing will probably wipe out all of GMs dealers. According to U.S.A. Today the filing will instantly freeze GMs payments/reimbursements to dealers for already performed warranty repairs. By now that means shut-down time because there won't be any money to make payroll. And there's no money to lend to dealers while the FDIC is nearly insolvent as the list of "problem institutions" mushrooms. Chrysler looks to be pretty close behind.
No time to be shy now... Here's what's coming over -- I would estimate -- the next two years: FDIC insolvency; Treasury default, the dumping of the U.S. dollar as the world's reserve currency (I started predicting that in maybe 2002); hyperinflation; bankruptcy of the Federal Reserve; and collapse of the United States government as we know it. Federal Reserve notes are legal tender for all debts public and private. What does it mean if the privately-owned Fed goes bankrupt? Our map doesn't see that territory yet. -- Oh yes, and a new strain of swine flu has been discovered in humans in San Diego... And farmers are committing mass suicide in India and Africa because they can't pay the loans they used to grow their crops or they are being undercut by large corporations. I suspect that inflation is much more contagious than deflation. I don;t know how hard that stage will hit here. But deflation in any industrialized nation is like blood in the water. CoLLapse will looking like a feeding frenzy as the carcasses get stripped.
The good news: Las Vegas is decaying like the corpse it is. Last night I watched a Dan Rather special on how bad things are there. Ugly! And yet the Mayor was insisting that the answer was to build more and bigger hotels to bring the people back... I call that the Easter Island syndrome. If anything symbolizes the worst of the old paradigm it's Las Vegas. It has to die so that others around the country will start to grasp that what is happening here is not just a bump in the road.
I wrote a pretty good book and was the subject of what I suspect is going to be a pretty good movie: CoLLapse that can soften the end result of all this. I haven't seen any of the movie yet. But was all this work by so many people in the nick of time or too late? I am beginning to think we'll look back and say the former.
We'll start to find out on May 1st. The sales numbers will tell us everything as we watch them build over time. If we're strong out of the gate we have a huge advantage.
Hang tough and find something to hug.
MCR
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