Surviving the perfect storm, Britain is bankrupt

Mike Robinson

Britain is bankrupt. There's no getting around that fact. We have a national debt of over £900 billion and rising. We have a massive black hole in the public pension pot of £1.2 trillion. We have personal debt of £1.5 trillion.

That is a total shortfall, today, of £3.6 trillion.
£6 Trillion - £188,000 Each

If we add corporate debt onto this figure, then the nation, its people and its employers owe somewhere in the region of £6 trillion to bankers in one form or another, complete with its burden of interest. And we are told we can solve this debt problem by creating more debt.

2.7 million people are presently unemployed - a rise of about 1 million people since the government bailed out the banks. And as a result of the already announced government cuts of between 25% and 40%, a further 1.5 million - 3 million people are going to lose their jobs.

Even if every man and woman capable of work were working and paying tax - around 32 million taxpayers - each of us would be working like slaves to service an average of £188,000 in debt. How does it feel to have a second mortgage hanging round your neck?

To add a final nail to the coffin, much of this debt is denominated in one foreign currency or another, leaving us at the mercy of exchange rates. Welcome to the third world.

The cuts announced in Osborne's recent budget are designed, he would say, to deal with the government deficit. Even if that were true, they will do nothing for the national debt, for personal debt, nor for corporate debt.

In fact, based on Osborne's plans, we won't even be able to cover the interest on the national debt. By the end of Cameron's first Parliament, the interest replayments on

Government debt will be in the region of £70 billion per year, which is more than 10% of today's annual tax revenue. To put that in perspective, that's equivilent to approximately 70% of the entire NHS budget.

Let's make no bones about it, we are in a deep, deep hole. Once further Quantitative Easing (money printing) is brought into the equation (as it already has been in the USA), and the imminent European banking collapse, one has to wonder how we will ever get ourselves out of this mess? I think it is no exaggeration to say upfront that people are going to die as the effects of the strategy of austerity and debt upon debt begin to bite.

I could wax lyrical about the specifics of how this has happened. But what can I say that has not been said already? So instead, let's put it in these terms: we are in this mess because of the corrupt thinking of all but a few in this country and the world. The corruption has been led by our so-called qualified economists, politicians and bankers, and has been followed by the rest of us who have ignored the very basic economic schooling we received when we were children.
The God Of Money



Ladies and gentlemen, it's time to waken up and remember that economy has nothing to do with money. The Satanic thinking of economists which has turned money into a commodity, which, they claim, has a value which can be traded on markets, has brought us to a place where money is worshipped as an alternative to God. It's fair to say that the saying "the love of money is the root of all evil" really is a truism, is it not?
Basic Infrastructure & Production, Not Money

The reality is that the only thing that creates value is the work we do. But not any old work - productive work. We only create value when we create something physical that people need. This rule of thumb does not include the printing of money, of course. Taking that route destroys value.

In order to support productiion of real physical goods, we need real physical infrastructure. Electricty, gas, water supplies, and equally importantly, transport infrastructure are absolutely fundamental requirements to any kind of real economy. These things are the foundation of any economy.



The worshippers of the great god money have quite deliberately and intentionally destroyed our basic economic infrastructure, just as they have destroyed our productive capacity. They have sold our infrastructure off to private corporations who have used it as a cash cow; sending us massive bills to use it, while spending the minimum to keep it running, sort of.

The chronic state of our roads network, our rail network, billions of gallons of water lost each year to leaking pipes and end of life nuclear and conventional power stations, is no more than organised criminal asset stripping of the nation. Very soon now, these companies will announce that they don't have enough money to build the new infrastructure needed to continue their ponzi scheme. Where will they come to bail them out, do you think?

Less than 20% of Britain's working population is involved in actually producing something. The rest of us are economic protitutes, doing no more than circulating money around the "economy" by servicing each other.

Since we don't produce anything which can be sold, how can the economy grow? Where does all the extra money come from?



Most people are aware by now that it appears out of thin air, or rather, at the punch of a key on a computer keyboard. In fact, since 1997 when Tony Blair became Prime MInister, the Bank of England has allowed the amount of Sterling in circulation to rise by 400%. But the "economy" has only "grown" by 30% in that time. Is that growth?

Or is that fraud?

While we have all been servicing each other and feeling drunk on rising house prices and staggeringly obtuse mortgages, we have systematically destroyed any capability we might have had to pay the piper when he came a-calling. We continue to destroy that capability quite deliberately and systematically, don't we Mr Cameron? Just ask Sheffield Forgemasters.
What Is The Solution?

Today we face a bigger threat to our nation and way of life than we did when war was declared in 1939, and none of that threat comes from immigration! In fact, if we are to get out of this mess, we will need everyone living here to get their hands to the pumps. It is no exaggeration to say that we need to mobilise as a people in a way that hasn't been seen since 1939.

If we continue to allow the Banks to behave as they have been, and more importantly, if we allow them to pull the puppet strings attached to our politicians and businessmen, we have no hope. They are effectively trading while insolvent, which is illegal, as it should be.
Banking In Administration

When any business gets into financial difficulty, it is absolutely standard practice put it into "administration". This is a very powerful process for control, where a company is insolvent and facing serious threats from creditors. The Court may appoint a licensed insolvency practitioner as Administrator, which places a moratorium around the company and stops all legal actions. This gives the company time to restructure itself and make rational decisions about the rescue of the company.

Why did this not happen with the banks?

We are staring a second, more serious, "credit crunch" in the face, as the banks struggle to store up enough capital to cope with an imminent market "event." We should not be waiting for this event to happen - let's get control of the banking system right now by bringing in Glass Steagall style banking regulation (e.g. separating retail and investment banking), writing off all illegitimate debt (anything which does not meet the standards of the new banking regulations), and protecting those functions of the retail banks that we find useful, e.g. savings and pensions. This still leaves a fairly big mess to sort out, but at least we would not be putting massive profits in the hands of the criminals who got us into this mess in the process.
Replace The Bank Of England



It really is time to replace the Central Bank - owned by the taxpayer, but run independently from government by commercial bankers. The Chairman of the Court of Directors, Sir David Lees, received the Officer's Cross of the Order of Merit of the German Federal Republic in July 1996. What for? This is a German state decoration, and although they seem to give them out like they're sweets, it begs the question, where do the loyalties of Sir David Lees lie?

The Bank of England holds assets in a wholly owned nominee company, Bank of England Nominees Limited. According to Hansard, these assets are owned by heads of state, including the Queen, but also foreign royalty and foreign governments. The Bank considers these people to be their customers. And yet, we the taxpayer, owners of the Bank. have no right to know what assets are held and for whom. Where does the loyalty of the Bank lie? Is it with the British nation, or is it with its foreign private corporate customers?

The opacity of the Bank of England is such that it cannot be relied upon to operate in the interests of the nation. It is simply acting as a broker between the government and the City of London. Its role then to to maximise profit from the debt owed by the nation, for the benefit of the commercial banks. It should be shut down and replaced with a national bank, whose functions would include real regulation of the financial system and its participants, and mangement of our sovereign currency, issued as public credit through Act of Parliament. This national bank would serve no commerical interests outside those of the nation, and would be required to be completly transparent and accountable.

Even once the work of financial regulation and debt restructuring is done, we still have a long way to go to get out of the mess. The pension black hole is a particular problem, and the only way we will be able to sort it out is by producing our way out if it.
Massive Infrastructure Rebuilding

A productive economy cannot be built, however, without infrastructure. Inexpensive electricity, gas, water and transportation are all required before restarting our manufacturing in any meaningful way.

We should be organising a massive publicly funded building programme to refresh our power stations, reservoirs and water pipes, railways and roads using the latest technology possible. That means using nuclear power and maglev trains. It also means taking back ownership of what's left of our current infrastructure. As mentioned above, this programme would be run on a scale not seen since 1939. It would be used as the driver to kick start industry and the real productive economy. In parallel, our schools, technical colleges and universities would be retasked to focus on real high tech engineering, machine tool design, and so on.
How Would We Pay For It All?

It should be obvious that if we can find trillions of pounds to bail out bankers, we can find it for good purpose as well. All money issued is debt, and we shouldn't be getting excited about that fact. The question is, should this debt be to a bank which will charge interest, or to ourselves, the people of this nation? We're not, after all, going to charge ourselves interest, and where our new shiny national bank is lending money to private corporations to fund the above projects, it can do so at small, simple interest of say 1-2%. So there would be the opportunity for British companies (globalist empire builders need not apply) to tender for exciting high tech projects which will provide productive employment, training and, in the end, infrastructure to support a real growing economy.
The International Angle

The British people should have been ashamed, the day Gordon Brown attended the G20 as the "Global Chancellor Of The Exchequer" pushing his globalist debt upon debt bailout solution on the rest of the world. Isn't it time we packed our current Prime Minister off to the G20 to propose international agreements among soveraign nation states, based on the economic principles discussed here? I would strongly suggest such an initiative is the only hope for civilisation.

Greece's national debt will be 120pc of GDP in 2010

Fears of a euro break-up have reached the point where the European Central Bank feels compelled to issue a legal analysis of what would happen if a country tried to leave monetary union.

"Recent developments have, perhaps, increased the risk of secession (however modestly), as well as the urgency of addressing it as a possible scenario," said the document, entitled Withdrawal and expulsion from the EU and EMU: some reflections.

The author makes a string of vaulting, Jesuitical, and mischievous claims, as EU lawyers often do. Half a century of ever-closer union has created a "new legal order" that transcends a "largely obsolete concept of sovereignty" and imposes a "permanent limitation" on the states' rights.

Those who suspect that European Court has the power pretensions of the Medieval Papacy will find plenty to validate their fears in this astonishing text.

Crucially, he argues that eurozone exit entails expulsion from the European Union as well. All EU members must take part in EMU (except Britain and Denmark, with opt-outs).

This is a warning shot for Greece, Portugal, Ireland and Spain. If they fail to marshal public support for draconian austerity, they risk being cast into Icelandic oblivion. Or for Greece, back into the clammy embrace of Asia Minor.

ECB chief Jean-Claude Trichet upped the ante, warning that the bank would not bend its collateral rules to support Greek debt. "No state can expect any special treatment," he said. He might as well daub a death's cross on the door of Greece's debt management office.

This euro-brinkmanship must be unnerving for the Hellenic Socialists (PASOK). Last week's €1.6bn (£1.4bn) auction of Greek debt did not go well. The interest rate on six-month notes rose to 1.38pc, compared to 0.59pc a month ago. The yield on 10-year bonds has touched 6pc, the spreads ballooning to 270 basis points above German Bunds.

Greece cannot afford such a premium for long. The country must raise €54bn this year - front-loaded in the first half. Unless the spreads fall sharply, the deficit cannot be cut from 12.7pc of GDP to 3pc of GDP within three years. As Moody's put it, Greece (and Portugal) faces the risk of "slow death" from rising interest costs.

Stephen Jen from BlueGold Capital said the design flaws of monetary union are becoming clearer. "I don't believe Euroland will break up: too much political capital has been spent in the past half century for Euroland to allow an outright breakage. However, severe 'stress-fractures' are quite likely in the years ahead."

As Portugal, Italy, Ireland, Greece, and Spain (PIIGS) slide into deflation, their "real" interest rates will rise even higher. "It is tantamount to hiking rates in the already weak PIIGS," he said. This is the crux. ECB policy will become "pro-cyclical", too tight for the South, too loose for the North.

The City view is that the North-South split may cause trouble, but that there will always be a bail-out to prevent a domino effect. "If a rescue turns out to be necessary, a rescue will be mounted," said Marco Annunziata from Unicredit.

It comes down to a bet that Berlin will do for Club Med what it did for East Germany: subsidise forever. It is a judgement on whether EMU is the binding coin of sacred solidarity, or just a fixed exchange rate system like others before it.

Politics will decide, and in Greece it is already proving messy as teams of "inspectors" ruffle feathers. The Orthodox LAOS party is not happy that an EU crew dared to demand an accounting from the colonels. "The Ministry of Defence is sacrosanct," it said.

Greece alone in Western Europe treats the military budget as a state secret. Rating agencies guess it is a ruinous 5pc of GDP. Does the country really need 1,700 battle tanks, 420 combat jets, and eight submarines? To fight NATO ally Turkey? Merely to pose the question is to enter dangerous waters.

Who knows what the IMF surveillance team made of their mission in Athens. The Fund's formula for boom-bust countries that squander their competitiveness is to retrench AND devalue. But devaluation is ruled out. Greece must take the pain, without the cure.

The policy is conceptually foolish and arguably cynical. It is to bleed a society in order to uphold the ideology of the European Project. Greece's national debt will be 120pc of GDP this year. S&P says it will reach 138pc by 2012. A fiscal squeeze - without any offsetting monetary or exchange stimulus - will cause tax revenues to collapse. Debt will rise higher on a shrinking economic base.

Even if Greece can cut wages without setting off mass protest, it lacks the open economy and export sector that may yet save Ireland in similar circumstances. Greece is caught in a textbook deflation trap.

Labour minister Andreas Loverdos says unemployment would reach a million this year - or 22pc, equal to 30m in the US. He broadcast the fact with a hint of menace, as if he wanted Europe to squirm. Two can play brinkmanship.

Thanks to SOTT for the post

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Obama’s Borrow and Spend Bill Looks Like a Done Deal

It looks like Obama’s stimulus boondoggle will pass in the Senate. In the video here, Obama promises us light at the end of the financial tunnel after the astronomical spending bill clears the last hurdle. In fact, we will enter a period of prolonged darkness and immense suffering.



Money does not grow on trees, my father admonished when I was a child. In Washington, there are no money trees. In order to get Obama’s spending plan rolling the government will have to borrow the money, impose substantial taxation on the American people, and fire up the printing presses over at the privately owned Federal Reserve. It is thought this will “jump start” the economy. It will do no such thing.

As Dom Armentano notes, even though the federal government increased its spending from $9.8 billion in 1934 to $14.2 billion in 1940, the unemployment rate in 1940 was still a staggering 14.6%. A 45% increase in New Deal spending in 6 years did not end the Depression. It took a World War to do that.

Of course, all of this spending has nothing to do with jobs in Podunk. It has to do with increasing the national debt and interest payments owed to a cartel of international bankers.

Last November, a Treasury Department report stated that the interest payment on the federal debt for Fiscal Year 2009 would be about $450 billion, making it the fourth largest expense in the federal budget behind Medicare-Medicaid, Social Security and defense spending. It is estimated Obama’s “stimulus” (borrow and spend) bill, currently pegged at around a trillion bucks, will add more than $50 billion to those annual interest payments.

In the district of criminals, spending your money — or rather increasing the obligation of your grand children to pay off the debt — is a fluid process. Recall the initial sell plan had the bankster “bail out” giveaway plan at $700 billion. It didn’t take long for that figure to grow astronomically. It was soon jacked up to around $8.5 trillion, a figure that represents 60 per cent of the U.S. gross domestic product.


Not surprisingly, the lion’s share of this money came from the banker-owned Federal Reserve. “Most of the money, about $5.5 trillion, comes from the Federal Reserve, which as an independent entity does not need congressional approval to lend money to banks or, in ‘unusual and exigent circumstances,’ to other financial institutions,” the San Francisco Chronicle reported last November.

Bankers like to call this “creating new money.” Indeed, it is the process of creating money – out of thin air and then charging interest on it. Peter Schiff, president of Euro Pacific Capital, says the government is trying to perpetuate a “phony economy” based on borrowing and spending. The bond bubble will soon burst and will ultimately lead to a collapse of the dollar and an “inflationary depression worse than anything any of us have ever seen.” It will be an “unmitigated disaster,” warns Schiff.

Our rulers at the behest of the international bankers want an “unmitigated disaster” and have anointed Obama to deliver it. In addition to putting us — and our children, and our children’s children — in hock for many decades to come, the current “unmitigated disaster” unfolding before our very eyes is designed to usher in a scientifically engineered global serfdom with an accompanying control grid apparatus. “We can’t drive our SUVs and eat as much as we want and keep our homes on 72 degrees at all times,” declared the pre-anointed one last year.

“Obama seeks not merely to control the means of production, but also to regiment individual consumption in order to bring the population into compliance with his vision of a better society,” writes William Norman Grigg.

It isn’t Obama’s vision, though. Obama is just a cigar store Indian. It is the vision of the New World Order, a bone-crushing juggernaut steered behind the scenes by a cabal of aristocratic families and international bankers.

Obama’s borrow and spend bill that will crank up the debt and pauperize America is simply the next phase of this horrific vision.

Kurt Nimmo
Infowars
February 7, 2009

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