Episode-935- The Economic Collapse that is in Process

The Current Economy is a Monetary Black Hole!

The Current Economy is a Monetary Black Hole!

I feel it is becoming more clear that our pending economic collapse isn’t something that will happen but something that is happening right in front of us.  Much as people in the Balkans felt no war was coming while mortars were placed in the hills around their cities we continue to think our economic woes are just the downside of a cycle.

There are signs and indications everywhere that we are not headed for a collapse but in one as we speak.  A long collapse which could have times that appear to look like recovery all while we still continuously drop toward the inevitable.

Many people think somehow we can “get our fiscal house in order” or simply “cut wasteful spending”, while I am of course for such things at this point it simply won’t matter.  The mathematics alone point to a single reality.  The current economy is a monetary black hole and sadly I fear we are soon to approach the event horizon.

Join me today as we discuss…

  • The lesson of how a black hole consumes a planetary body
  • What is a “super heated economy” and why is it happening in Germany
  • If gold isn’t money why are the central banks about to buy 10% of the worlds supply
  • Our nation will add more debt in just 2012 then we did from our founding though the Regan administration
  • Over the next 10 years the interest on our debt will total over 5 trillion dollars
  • 100 US Cities are facing a combined 2 Trillion in debt they will never cover
  • Numbers on the US Debt Clock going down that should scare you
  • Why there is no way out and what that means for us

Resources for today’s show…

Remember to comment, chime in and tell us your thoughts, this podcast is one man’s opinion, not a lecture or sermon. Also please enter our listener appreciation contest and help spread the word about our show. Also remember you can call in your questions and comments to 866-65-THINK and you might hear yourself on the air.

51 Responses to Episode-935- The Economic Collapse that is in Process

  1. White.Buffalo - Doug

    As always .. you are ‘right on’ (may-be even more-so with this posting) … I do my best to listen every day to you (sometimes it is late in the day = but, I listen to every posting) …. from a personal perspective I can almost hear the desperation in your voice – for me at least = just keep-on-keeping-on .. you are very much appreciated … thanks again for what you are doing

  2. @ Jack,
    In light of this “new” information on gold, do you still feel its wise to only do silver due to high gold prices? I currently have no gold, just silver, but Im thinking I might get a few ounces despite the high price.

    • Modern Survival

      @rob I never said only to do silver I simply said it was the safer play and I still feel that way. That said the banks own lots of gold and that makes it a lot easier for them to force prices up and down at will even when the wheels start to come off. When it comes to silver buying it and buying lots of it by lots of people is something that actually can show the lie of fiat money. The banks don’t have much in silver reserves, the government has almost none, they now have to import it just to meet silver eagle demand.

      If you have never watched The Silver Shield Series I highly recommend it with one point of clarification, I am not in the camp of going all in on anything as Chris Duane is.

      http://www.youtube.com/watch?feature=player_embedded&list=PLAC607AF992A840A8&v=qfC9VQGkqDQ

      • Yeah I know you didn’t say never. I just know you havent been keen on it lately for yourself because the price is so high. I think its good to have balance as well, just wondering if I should risk the higher price if indeed the banks will drive it up substancially. Just curious on your opinion since you are not a financial liar 🙂 Thanks for the link.

      • Jack, Chris Duane was an iinterview guest on Coast to Coast AM with George Noory just a few nights ago (July 3). Here’s his C2C bio:

        http://www.coasttocoastam.com/guest/duane-chris/58258

        And here’s an audio of the July 3 interview (his is the “second hour” interview so it doesn’t begin until 01:17:20):

        http://www.youtube.com/watch?v=gFpw9OC9tco

        Awesome interview.

    • I was wondering about platinum. In the past it was usually more expensive than gold, now it is appro. $140 lower than gold. Like silver platinum has industrial uses also. (Maybe the lack of hype keeps the price down)

      • Modern Survival

        @Allen the reason I don’t really focus on platinum or palladium at all is neither has ever been used as money. The reason I even added TSPCopper.com to the site and recommend people get some copper is that copper has often been used as money.

  3. To expand on silver/gasoline:

    In your example in 1965 gasoline cost .31 oz of silver.

    Now (assuming $3 gas) it’s ~.11 oz/gal.

    So, either silver is more valuable in general or maybe gasoline is just less expensive (or some combination). One would need to test each asset against a lot of other assets to come to a conclusion one way or the other.

  4. Brent Eamer

    I have not listened yet, but I feel your are getting close to the ‘get out’ stage?, much like 2008?

  5. Jack, Listening today has me wondering if we should have bought our BOL. We have been looking for years and found what we wanted. We do have a mortgage on it, thus why I am concerned. Too much foil hat? Thank you for the show.

  6. Trying to predict when the SHTF is like watching a magician pulling handkerchiefs from his closed fist. You don’t know how many handkerchiefs he has in his hand, but you know with each one he pulls you’re getting closer to the end of the trick.

  7. I’m not good with photoshop, but I still crack myself up. I hope people get it.
    https://dl.dropbox.com/u/33221384/meh.jpg

  8. TrekFanDan

    Jack,
    Outstanding shows today and yesterday…
    LMAO yesterday, and cryed today.
    I am INSISTING that my sleeping friends and family listen to these two!

    On cutting police jobs/guns…

    Exactly right…’Cutting the number of Cops means you have to RATION enforcement’ …
    – that is where the term “Death panels” comes from, Someone has to make a choice on who lives, and who dies. (Similar to the obama health care TAX. )
    Arm yourselves!
    The best pro-gun arguement for the moronic spouse is , “…let’s say you call 911, and WHEN they finally do show up, are they armed and ready? or not?… and, can you afford to wait?”

    • Ashaldaron

      @Trekfandan
      I live in Tucson. Thanks to police cuts and other town stupidity our police force in the city is way understrength. They are already not responding to residential burglar alarm calls in the city. So yeah, rationing coverage is the only way to go. Communities around here are hiring off duty police officers to act as “comunity security” because they can’t trust they will be helped in time.

      • TrekFanDan

        Ashaldaron,

        That sucks,
        …maybe organize community weapons training and post it on signs in the communities…
        “Armed neighborhood -ZERO tolerance!”
        …instead of the “neighborhood watch” signs.
        (I think Kennesaw, GA. has the right idea.)
        Before it’s over we all are going to have to rely on each other to fend off the scum.

        I like Arizona, when I lived in NC , I sent Gov. Jan Brewer a letter of support when she was taking heat on the illegal immigrants issue.

  9. Jack, another homerun. I’d like to reinforce what you said with my own observations: I’ve watched “on the ground” changes since the mid-80’s as I drove zig zag across this country between southern Calif., Idaho, and Tenn. several times over a ten year period, and what I saw was depressing. There were so many abandoned shopping centers, increases in mobile homes, farms giving way to subdivisions, urban spawl, new school buildings that looked like prisons, small towns declining, more freeways and new building everywhere along them. I was clear to me that people were spending more than they had which indicated, to me, at least, that the banks were owning all this. I saw an increase in outlet malls, storage units, flea markets, and yard sales. People were buying stuff they thought they wanted, that they stored and later sold or dumped. The buying frenzy looked insane to me. It continues today especially amongst the poorest, as they seem to think they are better off if they have more branded stuff, when in fact the opposite is true indicated by the increase in food stamp usage. Technology and information have exploded, yet some people seem to use it more for social and entertainment apps than information.

    At least there’s the counter-balance of other movements and awareness of politics,and economy. Dave Ramsey started his national “debt free” program in the early 90’s which has helped thousands if not tens of thousands of people to avoid, or get out of debt enslavement.

    Living outside America for about twenty years, I could see the empire following the fall of the Roman Empire, with its decadence and love of comfort, entertainment, and military expansion. We have our coliseums with sports much like the gladiators, and “all you can eat” restaurants which remind me of the barfitoriums. Modesty and sobriety model paganism, which may be alright if you want to be pagan, but I wonder if that’s an educated choice. I’m not aware of how the economy was at the end of Rome, but would like to know.

    For about thirty years I’ve watched that Romanesque black hole, but I called it the toilet.

    • Yes, it is sad to see the consumer sprawl as you drive/fly across country.

      I was looking at a painting we have of two traditional (Finnish) Lapp children playing, working on a wood-and-leather sled or something. I thought about how the bonds of family and community have become so weak, while the system we’ve built to prop up our modern isolated lifestyle has become so unsustainable. Or at least so complex as to become unpredictably unstable (derivatives, etc.).
      I appreciate the balance in the show, Jack. The positives and the preps (e.g. permaculture), and the occasional wake-up calls. Keep up the good work,
      David

  10. I can hear it in your voice also, Jack. It’s so wonderful that people like you are trying to pull others who have their heads in the sand out.

    There is one really good website called LEAP2020. They are a think tank in Europe. They have a 4 part series called “The future of USA – 2012-2016” basically saying the same thing you have been telling people. http://www.leap2020.eu/English_r25.html

    I don’t agree with everything they said, but they have some major good points there.

  11. I know today’s show was a serious (and slightly depressing) topic but the graphic on the blog post reminded me of the onion’s “Money hole” bit from 2008 and that made me smile.

    http://www.youtube.com/watch?v=JnX-D4kkPOQ

  12. Well that was uplifting! lol – seriously though, do you think this is a bad time to go into business or is that itself a good way to make it though this impending doom?

    • John-

      Having a job and a side business is a preparedness measure. 2 is 1, and 1 is none. I never thought of it that way, but when I lost my job in 2010, we had a solid base built for our farming business. Finding TSP has reshaped my thinking, and I now I realize that I was blessed with preparedness even though I didn’t do it intentionally.

      After that job loss, we focused really hard on our business plan to get this thing up and running to support our family. In 2011, it was a good chunk of our livelihood and this year it is almost all of our livelihood. That job loss was probably one of the best things to ever happen to us. We are now producing something people can’t live without: Food. That’s a good business to be in.

      And unlike working for someone else, I know exactly where we are at financially and generally speaking know it months in advance. It’s a good feeling. I don’t think there is ever a bad time to start a business, so long as you build it from the ground up with cash or very, very little short term debt that you will be disciplined to pay off quickly with any profits you bring in. Own the things that allow you to do your business, don’t owe against them. I would suggest cash only that you are willing to dispense with and potentially loose. And choose a business that people have a need for when time are good, or bad. In my case case, people gotta eat. And if for some reason they don’t eat it, we can. Our business gives us redundancy in our food preps as well.

      My .02 for what it’s worth.

      • @ Darby Simpson

        Thanks for the imput Darby, i agree, 2 is 1 etc. I think i will keep my main job as more of a part time indevor when we make the move next spring and open our store. Its quite a successful franchise that we’ve been able to get, but nothing is certain or a sure thing anymore in this economy. I thought about community supported ag also, but i think my gardening skills need to improve a little before that will become a reality lol.

  13. Cool podcast, first time listener!

    I’m curious what Jack’s response would be to people who make a flaky argument about the nature of the national debt. It goes something like this:

    “Well, since the majority of the national debt is actually to the Federal Reserve, it’s not really a debt, it’s just some accounting anomaly that at some point will be reset or readjusted by some kind of mutual agreement among the central banks around the world. So, the doom and bloomers out there should chill out on the debt hype. Government will take care of the problem eventually.”

    I don’t agree with this argument, but I am in the process of clarifying some counter positions on this. Thanks for any input.

    Keep up the great work on the show. I will consider joining the MSB in the near future!

  14. oh hold on guys my bad, i was just watching doomsday preppers and the experts believe that a financial breakdown in the US is extremely unlikely. lol
    Guess we’re good then 😉

  15. Happy July 4th, Independance Day. While watching some celebration for July 4th I was hit with thr recent loss of our liberty. So I think we need to recognize this also so,belated condolances on March 23rd/June 28th, Dependance Day. I picked June 28th as Dependance Day because of the recent ruling from Supreme Court on Affordable Care Act. Let me know what you think June 28th or March 23rd the date it was signed into law. I think we need to mourn Dependance Day every year.

    • Modern Survival

      @Allen I am not sure on the date there are some others that I would consider as well. Say the election date of FDR, the establishment of Welfare, etc.

  16. Great program; here is a really troubling news story: U.S. teen anger higher than thought. – “The study found close to 6 million adolescents met criteria for a diagnosis of Intermittent Explosive Disorder, a syndrome characterized by persistent uncontrollable anger attacks not accounted for by other mental disorders.” When the SHTF, this may unleash a wave of violence by mobs of teenagers.
    Read more:
    <a href="http://www.upi.com/Health_News/2012/07/04/US-teen-anger-higher-than-thought/UPI-69371341381204/&quot;

    • @Donna, I think I have Intermittent Explosive Disorder also! So if the study starts counting old buzzards we are now at a qty. of “1”.

  17. Jack, about 1/5 of the way into today’s show you mentioned the possibility of interviewing various people regarding economic collapse; in connection with this you mentioned the central banksters orchestrating a deflation in order to get people to beg for more QE…what I would really like to know from your future guests is several things:

    (1) What are the “gold star” indicators of imminent (as in, about to really get rolling within days) hyperinflation? I need something better–something prior to–than bank runs or bank holidays or people queuing up at the atm machines, so that I can get a head start on getting out of Dodge.

    (2) You cited the current deflation indicators (which you referenced by citing portions of the debt clock)…how temporary will this deflationary period be–by that I mean, are the banksters still trying to get the inflationary overheating that’s happening in Germany to get going here, or are the banksters in the process right now of trying to ramp up deflation so as to make people beg for a last catastrophic round of mega-QE/printing, or are the banksters for now just trying to buy time for continued accumulation of precious metals?

    (3) Re: bankster accumulation of precious metals: I’ve noticed that PM spot prices have been in a fairly tight holding pattern in the last year or so: silver from $27-35, gold from $1500-$1900–we all know that these prices will shoot upward when hyperinflation/highinflation takes hold, but my question is: how will be the immediate response of PM prices respond to the “deflationary head-fake” that the banksters will be orchestrating?

    BTW great shows both on 7-2 and 7-3 jack…I think the July 3 2012 show is one of the most important I’ve encountered out of the 500 or so that I’ve listened to.

  18. Ronnie in Iowa ~Veronica Deevers

    I just sent this podcast off to 190 people.
    Thank you Jack. You are today’s Paul Revere.

  19. David Wiebe

    Collapse in process… and accelerating

    Mammoth Lakes, California filed on Tuesday for Chapter 9 bankruptcy protection from its creditors due to a nearly $43 million legal judgment against it.

    Stockton, a city of nearly 300,000 people in California’s Central Valley, filed for bankruptcy protection last week, becoming the most populous U.S. city to seek protection from its creditors.

    http://www.reuters.com/article/2012/07/03/us-mammoth-lakes-bankruptcy-idUSBRE8621E920120703

  20. Great show, as always! Been slowly buying stuff for preparedness but I only have so much income. I need to finish my BOBs up (will not be staying where I live!), buy more ammo (have a little), and buy silver (have none). In what order should I purchase these items? or should I buy a little of each?

    • My opinion: get the BOB’s finished, and get all documentation packages for every family member finished also.

      The rest of it I’m less dogmatic on as far as “in what order. do we do this?”

    • It can be kind of over-whelming. Actually sitting down and strategizing (lists, areas of weakness, etc.) might be a good first step. There might be steps that don’t require a lot of funds that will still pay dividends (e.g. putting stuff together into a “go tub”, building a blackout kit from what you have, etc.)
      For most of us, I think “getting one’s house in order” in terms of job, finance, etc, is a bigger a deal. And many of those steps can be done concurrently.

      As for ammo: I’d guess having a few hundred rounds at minimum. Beyond that, you could buy-as-you-go for training and currency. Buying a lot of ammo at once is mostly a way to make it cheaper… I’m not really sure how many of us who are planning to bug out need 5000rds of ammo at the home they’re going to leave anyway. A big way to save money is have common calibers and change around your guns to need fewer calibers (e.g. 9mm pistols+carbine). Just meaning this as an example, not a “one size fits all” solution.

      David

  21. Exellent Job Jack! I think you really explained the costitutionalist position very well. I also could not agree with you more. The name calling and labeling must stop.

  22. Jack, I always like your insight on the economy . I grasp how you can remember so many facts about the economy, make sense of it, and then distill it into a big picture to project forward. But I was wondering if there are times that you’ll be explaining this stuff to someone (esp family) over a beer…whatever… and they just don’t seem to want to get your logic and reasoning which seems so obvious to you. To me it’s been frustrating trying to explain this stuff to family and they just can’t seem to get it, as if they have a mental fog. These are people I need to rely upon for community but I can’t prep for them.

  23. Dr. Michael J. Burry at UCLA Economics Commencement 2012.
    He tells the graduates they will experience an economic crisis in their 20s.

    http://richartruddie.blogspot.com/2011/01/11-greatest-trades-of-all-time.html
    The 11 Greatest Trades of All Time
    5) Subprime short by Dr. Michael Burry of Scion Capital
    This is perhaps the most known trade of the financial crisis because it was than piggypbacked by Sid Bass, John Paulson, and Jeff Greene. While it’s great to see writers who don’t know anything about trading and finance list and talk about Paulson as the mastermind of the biggest trade of all time so many seem to leave out a man with aspergers disease who studied everything about the housing market and went to wall street with an idea to purchase credit default swaps to which the banks laughed at first and said please be my guest purchase more….(you can guess who laughed in the end. The Big Short by: Michael Lewis talks about Dr. Burry)

  24. Love the suggestions for things that we can be doing now. Owning firearms, learning mechanical skills, all these things that we touch on, but the backdrop of the economic collapse that you discussed here brings them to life in a way that fits with the rest of the picture.

    Thanks for the great info and passion. This was definitely a powerhouse episode. You are “home” when you’re talking about this stuff.

  25. Pingback: OS News Dump for 7/7/2012 « occupysecession

  26. dayum. THAT was a good podcast.

  27. RT’s Capital Account used the black hole imagery on the program today.
    Steve Keen on the Minsky Singularity and the Debt Black Hole’s Event Horizon!
    http://rt.com/programs/capital-account/steve-keen-debt-horizon/

  28. We are undoubtedly in the greatest collapse in the history of mankind. It has happened before and it is happening again.

  29. In the current political landscape, Rep. Ron Paul, is the only public figure who has even attempted to tell the truth behnd The Fed scam, and all the Rothschild Dynasty controlled central banks. The Bankster owned media blackout notwithstanding, he made considerable political headway across this country. I am curious as to why you think the establishment allowed this to happen? Don’t they usually find some way to eliminate prominent whistleblowers who expose them?

  30. Wynn Williamson

    Jack,

    I really do not understand the basis for the argument that German is overheating. I personally BELIEVE this to be the case but know many people investing in the market right now as a refuge with the argument that (1) Germans actually produce thing (2) the people at large take on little debt (many renters, corporations generally more responsible, less stock market speculation…).

    What is the counter-argument? Help me get my head around this point.

    • Modern Survival

      @Wynn you are right about one thing, you don’t understand.

      Right now people in Germany are spending money with the view of “I better spend it now before it buys less tomorrow”, if you knew the first thing about economic history that would be all you need to know.