The Great Lemming March

January 24, 2001

Gold-Eagle.com readers will understand if I break into a rousing chorus of "Ding, Dong, The Wicked Witch is dead", from the 1939 movie "Wizard of Oz." The amoral opportunist child king Clinton is finally gone from power. He's now begun his new life as a tabloid talk television host interviewing Dennis Rodman and World Wide Wrestling stars. The fit is perfect. At least, that's what I hear he's going to do now that his Arkansas law license has been suspended. Of course, he got over. Of course, he got revenge. Of course, right up to two hours before he left he was playing the part perfectly. The man has no class, nor honor, nor integrity, nor shame. He's exactly the kind of President America deserved. The damage he's done is structural. The damage is permanent-whether it's a new outbreak of sexually transmitted disease among 12 year olds practicing oral sex-whether its the unpunished high treason that has allowed Red China to threaten American lives and finally, whether it's his foreign policy bungling which will lead to war and depression. Actually, way back in 1992, after watching that first pathetic 60 Minutes interview, I knew what Clinton was. Human trash with the ultimate political power. Now, whether all those Internet rumors about him being a British, Russian or New World Globalist plant are true or not isn't important. He's taken American down. The United States is kaput. The American people are simply too dazed to realize what's happened. The depression is here. The war is coming. We've sown the whirlwind and are now reaping it. Bill Clinton's true legacy is the whirlwind.

There is much discussion in the lapdog press about whether the United States is in economic recession. I find this hysterical. Here are the guys who haven't even admitted the NASDAQ has collapsed 50%. Here are the guys who are still saying to buy Internet stocks, the government really has a budget surplus and yada, yada, yada. Not a clue. Not a clue. Judas goat economists braying loudly to keep the sheep wandering up the ramp into the slaughterhouse. I guess that's what they get paid for. The time is coming when the ruling class will finally be revealed for what they are. It will be too late to exact a suitable judgment upon them, but at least they will shown for the braying jackasses they are. Bill Clinton has been exposed clearly for what he is. It ain't much, but at least it's something. The time will come when a peon like moi will be held to be a credible economist, simply because I wrote the truth with integrity and honor. Too bad it will be too late. Too bad the disaster will be upon us with few to be spared. But at least the elite will be revealed for what they are to the most foolish American.

Where to begin on the American economy? There is such a vast amount of raw data that one must pick and choose carefully. One must ponder and decide which individual pieces of information are relevant to the current economic situation. Am I intimidated? Do I feel overwhelmed? Of course not. I'm a Gold-Eagle.com pundit and modesty isn't anywhere in my gene pool. Seriously though, the raw economic data indicating recession is obvious to anyone not a paid shill for the system. Even Bush is talking about a recession, although he has a ulterior motive for doing so. The facts are pretty obvious. I'm not impressed that an official recession has not been declared. To me, this official declaration is like the shipwreck survivors on the beach looking at the ship sinking in the distance and proclaiming, " We're in a shipwreck." While accurate, the timing is a bit off. The popular psychology is the trigger event for me. And the popular psychology has been in heavy recession mode for several months now. It's just the whore press has suppressed the obvious to maintain the stock market.

My official recession began on July 4th when high energy prices first began to devastate the American economy. You remember those don't you? All the while the official inflation rate was 3%, the real economy and consumers were dealing with 75% increases in energy prices. The kind of price increases we were solemnly assured didn't exist, and if they did they didn't really matter in the "new economy." The ongoing NASDAQ collapse fed upon these massive energy price increases so that by Labor Day, we had a definite change in people's attitudes. A summer full of high gasoline prices, followed a fall and winter full of high electric, heating oil and natural gas prices. The total effect was to drain people's disposable income into paying energy bills. Of course, the lapdog press missed all this. Not a word in October, November and December about people not buying much of anything. They didn't buy cars or SUV's; they didn't spend money on Christmas; they didn't buy Personal Computers. Why didn't they buy you ask? Simple. People ran up significant increases on their credit cards in November and December just to pay their energy bills I think. People are like lemmings on that fateful march to the cliff edge. 1.5 million went into bankruptcy last year. Now they are borrowing on their credit cards to pay energy bills. The economic end will come soon now. The waves will wash over the overextended, overexposed and credit charge challenged nation and sweep us all away. You haven't got it yet. The reason this economic recession will turn into an economic holocaust is simply debt. WE CAN'T SERVICE THE DEBT NOW. HOW WILL WE DO IT IN A RECESSION? No expert wants to ask that question, much less answer it.

Ah, the statistics you say. Fair enough. We are currently in an automobile production slowdown. This is caused by a automobile buying slowdown. Chrysler plans to cut production 26% the first quarter of 2001. Pretty significant slowdown to me. Sounds like serious recession/depression level cuts. Ford and General Motors also plan production cuts. Ford and GM both owe over $250 billion dollars. In a good quarter they can make $6 billion. Do the math. Take a deep breath and do the math. Now, assume profits are cut in half. The debt remains the same, but the ability to repay doesn't. Anyone come up with a best case of 6 billion times 40 quarters(10 years) to repay the debt? Or how about 80 quarters? Heck, let's say 120. The point being, consumers, government and business are in exactly the same situation as Japan. We're looking at years, or maybe decades, to work the debt down. Assuming we don't default.

Speaking of debt default, the situation in California is serious and imminent. California's energy providers owe over $10 billion. The pathetic legislature authorized $400 million to buy energy. Did anyone else see the video of the loony crashing the semi truck full of dried milk into the state capitol? New York lost 500,000 white middle class types, and California lost 700,000 in the 1990's. Anyone wonder why? Just be aware, the California energy crisis is a wild card in the American economy. A wild card which can surely make a normal recession much worse than it normally would be. As things stand right now, we have economy wide massive energy price increases. We also have significant auto production cuts. Add to that a significant economic impact on California. Yet, the official line is we're not in recession, except from the Bushies, who are in SOAP ( save our ass politically) mode. Let me make things clear. The energy price spike is eliminating consumer spending. The California energy crisis is having serious, but currently unmeasured, economic effects. The auto industry is at depression level production levels for the next few months. Nobody is buying computers. People are in debt up to their wazoos. Now, you want to tell me again we're not in a recession?

Ok, time for the big guns. I have an acquaintance who runs a small grocery store. Guess what he noticed right before Thanksgiving? People are changing their grocery shopping habits. They are buying bread, potatoes, milk and cereal. Why, you ask? Stop and think about it. These four foods are relatively cheap and will feed a family for an extended period. Add to that the fact Christmas sales were flat and it's obvious people don't have any money. We're now looking at the run up to April 15th. Nobody buys much in the first 90 days of a new year. A few things for Valentine's Day, but that's about it. Especially when your income is being raped by higher heating costs. The first quarter is burnt toast. The second quarter might be a little less burnt if the media con job kicks into high gear. However, unless the economic reality on the ground changes, I doubt it will work. Whatever the economic statistical gymnasts say about inflation, the economic reality people face when they write the check to pay the energy bill is pretty grim. Total up the billions of dollars people are paying for higher energy bills; then, subtract the total from consumer spending. It's a no brainer to me. How much more will people borrow? I don't know. How much more will Greenspan and the system lend? I don't know. I think once the objective economic reality of Wards closing, auto plant layoffs, dot.com closures and the like hit, the recession will take on a life of its own.

Many people are predicting stagflation, economic growth with rising prices, similar to the 1970's. I don't think so. I think there is a lot of excess capacity, in retail, in PC production, in manufacturing, auto production, etc. etc. etc. The debt must be worked down. The excess productive capacity must be worked down. If either of these begins in earnest, then recession doesn't even begin to describe the process. I think the United States is seriously looking at a 15 to 25% reduction in both the value of the dollar and our total economy. The balance must be restored. As for the stock markets, the NASDAQ is still at a 100 PE. I still stand by my prediction of between 500 to 1000. If I'm correct, the United States is looking at serious, multiyear percentage reductions in economic activity. Japan is now starting its eleventh year of economic flu. It's stock market is down 60%; the economy is a basket case. The interest rates have been cut to zero. Nothing has worked. The excess was so huge that even eleven years, zero interest rates and huge public works projects haven't helped. Why do we Americans think our economic problems are any different? Has anyone pondered what will happen to the global economy once our $400 billion import buying spree comes to an end? Europe is currently the only area growing economically right now. Lord Acton says, "Power flows to those who accept responsibility." I say Europe's turn at the bat is coming up. You know things are bad for the United States when the EURO gains 10% against the dollar. Greenspan has sold out the dollar and the foreigners to maintain the stock market. Watch the foreigners. They will decide America's economic fate. Watch the foreigners and buy hard, precious metals, assets to protect yourself against a 25% dollar devaluation. We're halfway there already.

 

People sleep peacefully in their beds at night because rough

men stand ready to do violence on their behalf. George Orwell

One cubic foot of gold weighs more than half a ton (1,306 pounds).

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