http://rapidshare.com/files/182633849/E_-_Books__tamil_.rar104857 KB "Never explain yourself to any one.

Because the person who likes you doesn't need it, and the person who dislikes you won't believe it". This is where things get interesting for those interested in a global system of human freedom and liberty. Hayek proposed that in a free market spontaneous orde r emerges out of chaos based on self-interested human action. Trillions of selfinterested human decisions produce the activity in global markets on a daily bas is. Hayek recognized that this spontaneous order is part of complex system devel opment. Spontaneous order emerges from chaos. The crisis of 2008-2009 revealed that the price mechanism of markets is greatly distorted by the interference of human design. Fiscal and monetary interventioni sm produces malinvestment. Overvalued homes around the world and the bad mortgag e debt they spawned are one example. The price mechanism failed and was unreliab le for effective human action. Chaos is only a few trading days away in a comple x system distorted by human design and interventionism when confidence heads sou th. Central planning is not self-interested; it is falsely presented as representing the collective interest, but in fact typically just watches out for special int erest, most recently the big banks that continue to leverage their zero interest money, pushing up the price of commodities and food around the world. Clearly, free markets have suffered a major setback, and there are a growing num ber of examples of central planning that trades self-interested human action for anarchy around the globe. Free human action produces a dynamic stable system of risk and reward at the edge of chaos. Central planning by human design produces global crisis and anarchy. Person or organization can allocate the resources of such a large complex system as the global economy, but there are invariably those that believe they can. Ce ntral planning that steps in and takes control from the free market, prevents th e natural spontaneous order that allocates resources by rewarding those that mos t effectively fill market needs with the right mix of price and quality in their products and services. A study of history suggests that the outcome of central planning is not order, but is in fact chaos and destruction of everything we hol d dear. Central planning prevents the price mechanisms from working, and the com plex system breaks down, imploding from the weight of its contradictions. History offers no guarantees. If America plunges into an era of depression or vio lence which by then has not lifted, we will likely look back on the 1990s as the decade when we valued all the wrong things and made all the wrong choices. - Th e Fourth Turning - Strauss & Howe -1997 Personal income is stagnant, as are hours worked, as inflation increases robbing workers of purchasing power, thereby negatively affecting consumption. Politicians are terrified and are doing as they are being told. The financial co mmunity and central banks are making all the decisions. In order to cover-up wha t is going on they simply lie about everything. Is the End of the Financial Crisis in Sight? Will all this kill off the great financial crisis that is still the affecting th e U.S., or even Europe for that matter?

No, it will not. In large part, it will only kick the can down the road until ou r leaders wake up and realize they can no longer spend other people s money with r eckless abandon. Until that day comes, and I m afraid it won t come for a few more years, and not unt il it gets so ugly in our country that our leaders have no other choice, we are likely to see some of the most violent, wild market moves ever. And, we will likely see the end of the dollar as the world s reserve currency as w ell. For now though, you owe it to yourself and your loved ones to recognize and unde rstand what s happening to both protect your wealth and grow it. And you need to recognize another force that is one of the biggest ever to hit c ivilization: The evolution of 84% of the world s population some 5.88 billion soul s who now want lifestyles as good as we have in the developed world. It s an economic force that will continue to drive emerging economies and natural resources higher for years to come. Lastly, for today, a thought I d like to end on: Thank God we don t live in the 1930 s, when there were so few ways for U.S. investors to protect themselves. Instead, we should all count our blessings that we live in a world where there i s such a variety of investments, that you now have full control over how to both protect and grow your wealth. You no longer have to bury it under your mattress or in the back yard. WHAT MAKES ECONOMIES GROW? The answer to this question has been clear since the days of the little-known Sc hool of Salamanca in the sixteenth century. It was popularized by Adam Smith in 1776. This was made even more clear by Austrian School economists, beginning in the 1870s. What makes economies grow is this: (1) private ownership, (2) future-orientation , (3) capital formation through thrift, (4) technological innovation, (5) a syst em of profits and losses, (6) low taxation, (7) free trade at every level, (8) t he enforcement of contracts, (9) honest money, (10) the reduction of envy. This list can be boiled down into three phrases, all of which have been dominant in t he history of the United States. 1. Live and let live. 2. Let's make a deal. 3. Mind your own business. The American middle class has seen its progress blunted ever since 1973. There a re reasons for this. (1) present-orientation, (2) capital consumption through re duced thrift, (3) government-capped profits and government-subsidized losses, (4 ) rising taxation (Social Security), and (5) dishonest money (no gold exchange s tandard after 1971).

The two and one half years since September 2008 have set the stage for a far wor se catastrophe. The Obama administration jammed an $800 billion pork filled stim ulus bill down the throats of America, along with home buyer tax credits, loan m odification programs, and a healthcare plan that will crush small businesses. Th

e politicians, government bureaucrats, and mainstream media corporate mouthpiece s proclaim that their wise and prompt actions averted a Second Great Depression. The government solutions used to "stabilize" the situation have wrought uninten ded consequences and planted the seeds of further pain and suffering to come. A summary of what has happened in the last few years is in order: * On September 18, 2008 the National Debt stood at $9.66 trillion. Today it stands at $14.16 trillion, a 47% increase in 2 1/2 years. * The country is running $1.5 trillion annual deficits and will continue to do so for the foreseeable future. * The States are running cumulative budget deficits of $130 billion in FY11 and expect deficits of $112 billion in FY12. This is leading to conflicts with u nions, higher taxes and mass layoffs of government workers. * The working age population has risen by 5 million, while the number of emp loyed Americans has declined by 6.5 million. The true unemployment rate http://w ww.shadowstats.com/alternate_data/unemployment-charts has risen from 12% to 22%. * In September 2008 there were 30.8 million Americans on food stamps. Today there are 44 million Americans on food stamps (14% of the U.S. population), a 43 % increase in 2 1/2 years. The annual cost has risen by $37 billion, a 100% incr ease in 2 1/2 years. * Real inflation http://www.shadowstats.com/alternate_data/inflation-charts bottomed at 5% in early 2009, but has accelerated to 9% today, with further inc reases baked in the cake. * Gasoline prices bottomed out at $1.61 per gallon in January 2009 and have risen to $3.54 per gallon today, a 120% increase in just over two years. * Households have lost $6.3 trillion of real estate related wealth since the peak of the housing market. Home prices have fallen for six straight months. * Almost 3 million homes have been lost to foreclosure since 2007. * There are 11.1 million households or 23.1% of all mortgaged homes, underwa ter on their mortgages today, with rates above 50% in Nevada, Arizona, Californi a, and Michigan. * Fannie Mae and Freddie Mac were taken over by the US government and have l ost $170 billion of taxpayer funds so far. Losses are expected to reach $400 bil lion. Along with the FHA, they continue to prop up a dead housing market with mo re bad loans. * The Federal Reserve balance sheet in September 2008 consisted of $895 bill ion of US Treasury bonds. Today it totals $2.55 trillion of toxic mortgages boug ht from Wall Street banks and Treasury bonds being bought under QE2. * The Federal Reserve and the Treasury Dept. intimidated the FASB into allow ing Wall Street banks to account for worthless mortgage and real estate loans as fully collectible. Magically, insolvent banks became solvent - on paper. * The Dow Jones was 11,700 in late August 2008 and today stands at 12,000. T he Dow has risen 84% from its March 2009 low. The top 1% wealthiest Americans ow n 40% of all the stocks in America, so they are feeling much better. * In late 2007, a risk averse senior citizen could get a 5% return on a 6 mo nth CD. Today, after two years of no increases in their Social Security payments , a senior citizen can "earn" .38% on a 6 month CD. * The Federal Reserve lowered interest rates to 0% in order to allow the Wal l Street banks to borrow for free and earn billions without risk. * Over 300 smaller banks have been closed by the FDIC, with losses exceeding $50 billion. There are another 900 banks on the verge of insolvency, with estim ated future losses of $100 billion. * The Federal Reserve initiated QE2 in November 2010, purchasing $70 billion per month of Treasury bonds and attempting to create a stock market rally. They have succeeded in creating a tsunami of energy, food, and commodity price infla tion across the globe, sparking revolutions among the desperately poor in the Mi ddle East. * Wall Street banks "earned" record profits of $19 billion in 2010 after nea rly destroying the worldwide financial system in 2008 and raping the American ta

xpayer in 2009. * No Wall Street executive has been prosecuted for the fraudulent actions co mmitted by their banks. * Wall Street banks handed out $43.3 billion in bonuses in 2009/2010 for a j ob well done. The average Wall Street employee received a $128,000 bonus in 2010 . In 2008, the year they crashed the financial system, they still doled out $17. 6 billion in bonuses. * The median household income in 2007 was $52,163. Today the median househol d income is $46,326, an 11% decline in three years. Real average weekly earnings are lower today than they were in 1971. It is clear from the list above that the oligarchic players that wield the power in this country have chosen to prop up their tottering structure of debt-create d-wealth on the backs of the working middle class. The people who have been scre wed and continue to be screwed are growing angry and distrustful, as anticipated by Strauss & Howe. Taxpayers don't want to pay ension plans for government athy and lethargy are over. rvival of the country is at higher taxes to support gold plated healthcare and p union workers. The decades of compromise, denial, ap The mood of the country has changed dramatically. Su stake.

The government has systematically "adjusted" every economic statistic in order t o paint the most optimistic view possible. Unemployment, inflation, government d ebt, and GDP are all manipulated in the most positive light. Bernanke and his minions at the Federal Reserve will choose inflation as their p oison because it will allow their banker masters to pillage the remaining wealth of the middle class before the final collapse of the U.S. dollar. The financial industry complex, military industrial complex, and big pharma comp lex are stronger and more powerful today than they were in 2008. The wealth distribution of the country is more heavily skewed to the "Haves" ver sus the "Have Nots" than any time in history. The austerity measures that are being proposed on the backs of the middle class and senior citizens, while ultra-rich bankers have been bailed out and allowed t o continue pillaging the countryside, will surely lead to class conflict. Genera tional warfare between the Boomers who want what they are "owed" and younger gen erations stuck with the bill will flare up in the coming years. 17 million jobs were created out of 26 million as a result of securitization of credit, a market that no longer exists. As a result over the past two years the economy has lost 2 million jobs. Those losses are complicated by the losses attr ibutable to free trade, globalization, offshoring and outsourcing. Due to this t rade policy the economy cannot increase output to any great degree, nor can it p roduce jobs. The birth/death ratio doesn t fool any inquiring mind. It is simply b ogus and the millions of jobs created under its statisticians are lies and worth less. As long as we have such a trade policy we will have to have quantitative e asing indefinitely. 23 Things about Capitalism -------------------------Long-term success requires taking seriously everyone who contributes to a busine ss: not just equity investors but also employees, suppliers, customers, and plan t communities.

Brutal anti-inflationary policies can easily do more damage than the inflation t hey combat. Protecting the value of a nation s money is less important that protec ting its economy as a whole. We ve had more financial crises the more obsessed wit h hard money we ve become. Every developed nation from England down to the present day got that way through protectionism and state industrial policy, not pure free markets. Even the good ol USA played this game from Independence until after WWII. Making rich people richer doesn t make the rest of us richer. Trickle down economi cs doesn t work because wealth doesn t trickle down. It trickles up, which is why th e rich are the rich in the first place. People in poor countries are more entrepreneurial than people in rich countries. Yup: they open up fruit stands at the drop of a hat. This doesn t stop them from being poor, so stop telling them they need to be more entrepreneurial. Their probl ems lie elsewhere. We are not smart enough to leave things to the market. In the real world, market s don t take care of themselves. They need to be regulated. How much and in what w ay is legitimate party politics, but an unregulated economy is a dangerous fanta sy. More education in itself is not going to make a t education, but industries for educated people ucation isn t necessarily the kind of education ith its neglect of serious vocational training. country richer. You need not jus to work in. And paper-pushing ed you need something America forgets w Again, ask Germany and Japan.

There was (maybe) once a time when the interests of giant corporations were reas onably closely aligned with the interests of the national economies they reside in. That time is long gone. Multinationals will treat nations as hotels if we le t them. Equality of opportunity may be not be fair. A get what you deserve society sounds good, and in many ways it is, but there need to be some minimums for what even t he losers get. Financial markets need to become less, not more, efficient. Efficiency in financ ial markets isn t the same thing as efficiency in other industries. It can easily just mean efficiently sinking into debt. Even we Americans understood this from ab out 1930 to 1980; time to relearn it. Good economic policy does not require good economists. Most of the really import ant economic issues, the ones that decide whether nations sink or swim, are with in the intellectual reach of intelligent non-economists. Technical Economics wit h a capital E has remarkably little to say about the things that really matter. Co ncerned citizens need to stop being intimidated by the experts here. --------------------------------------Instead of paying for goods to support U.S. jobs as was the case decades ago, U. S. consumers continue to send money overseas to buy everything from cars and con sumer electronics, to prescription drugs and furniture. This trade deficit has a dded to America s massive national debt, while China adds to its massive trade sur plus and foreign reserves. The fact is that anytime you see a trade deficit, it means jobs are being sent overseas. Meanwhile, the Federal Reserve is working overtime to steal savings from America ns through artificial suppression of interest rates. This is also leading to wid ening pension deficits as well as global inflation which has reached worrisome l evels in Asia and Latin America.

Unfortunately, America s Second Great Depression will persist for years to come, a nd will be made worse if Washington continues to ignore the fundamental economic problems of unfair trade, the broken healthcare system and pension deficits. The only way to produce real wealth is by creating good jobs and making sure tha t the opportunities are equally distributed. Once consumers have been provided with good jobs with wage increases, the real estate market will rebound. To John Maynard Keynes, a depression results from a fall in investment, in turn caused by a fall in consumer spending (this fall being a byproduct of saving). H e considered this a major natural weakness in the capitalist system, thus justif ying the "socialization" of investment. Government spending is inherently inferior to private spending and does not oper ate within the coordinating forces of the market. The market processes that coor dinate activity between savers and investors, consumers and producers, and so on , are very real. The continuous process of allocating resources throughout society is simply an a ggregate of the ongoing calculation that takes place on an individual basis. The se individual actions coordinate on a macroeconomic scale through the pricing pr ocess and through the division of labor. Producers are rewarded or punished thro ugh profit and loss, creating a tendency for capital to flow to those who use it the best (those who satisfy the consumer the most). This is the market method o f rewarding "efficiency." The consequences of government spending can only be properly assessed within the framework of market coordination. If socialized investment is truly warranted, then the results of the investment must be better than the result that would hav e occurred had those same resources been economized by individuals on the market . In other words, the government's method of deciding on investments would either have to enjoy the same characteristics as the market's, and the government a bet ter entrepreneur, or the government's method would itself have to be in some way superior. We can rule out the latter option on the grounds that we know that th e only method of economic calculation is by individuals through the pricing proc ess. Therefore, government investment is inherently inferior to free-market inve stment. The ability for one individual to acquire the means necessary to accomplish a ce rtain end is influenced by the abilities of others competing for the same means, and in this fashion too does the market reinforce the tendency of efficiently e conomizing the means toward the most important ends. Government does not face th e same constraints or the same motivations when it spends. Government spending, whether done directly or through subsidies, redistributes r esources from the individuals who would have economized them and instead allots them toward less-preferred ends, the opportunity cost represented by the foregon e production represents a net loss to society. People who live and work primarily within the religious milieu are dealing mainl y with goods of an infinite nature. These are goods like salvation, the interces sion of saints, prayers of an infinitely replicable nature, texts, images, and s ongs that constitute nonscarce goods, the nature of which requires no rationing, allocation, and choices regarding their distribution. If one exists, lives, and thinks primarily in the realm of the nonscarce good, t

he problems associated with scarcity ys be elusive.

the realm that concerns economics

will alwa

Without doubt, the main reason for India to underperform was high inflation in t he first place. The transmission channels how high inflation feeds into equities underperformance are numerous. First, high inflation propels wage hikes and mak es exporters uncompetitive. Second, high inflation irritates central bankers who in turn have to tighten monetary policy. Higher interest rates and less money i n the economy will cause revenues slow down. Third, companies may not have enoug h pricing power to carry higher input costs into prices of finished products. Th ere are other channels such as less money (read less oil in the economy gear sea t) will expose all the frauds and badly managed companies relying on cheap inter est. We had such an example in Indian microfinance companies or Reliance conglom erate. As we are climbing up towards the peak of solar cycle 24, we may therefore see m ore incidences of earthquakes. Human mass excitability has been shown to correla te with peaks in solar activity, with A.L. Tchijevsky finding that 80% of the mo st siginificant historical human events occured within the years around the sola r maximums, specifically "mass demonstration, riots, revolution, wars and resolu tion of most pressing demands". Again, as we approach the current cycle 24 peak we may therefore see more such activity.Translated to economics, we see a correl ation of peaks in inflation with solar activity peaks and a correlation in reces sions following solar cycle maximums. Combining these two charts with the solar cycle 24 forecast chart, we arrive at a prediction of inflation increasing into a peak around 2013 followed by a reces sion. Note that the 2013 peak is only a forecast and as solar cycles vary in len gth around an average it it possible that the recent escalation in sunspots in r ecent weeks could make for a steeper trend to peak a little earlier, we shall se e. Either way, it might be prudent to be now invested in assets that do well in an inflationary environment as we trend up to the peak, such as precious metals and energy. Every third solar cycle peak corresponded to a secular peak in tangible assets ( such as gold and oil) in relation to paper assets, and the peak of solar cycle 2 4 will be the third since 1980, putting us on track for another relative peak in hard assets at the currently forecast cycle peak of 2013. Going further still, we can estimate the next commodities peak after that to be 3 further solar cycle peaks away at around 2046. Using secular averages, we could therefore estimate a secular commodities bull to occur from around 2030 to the mid 2040s, and worki ng back, a secular stocks bull from around 2014 to 2030. In summary, the recent escalation in solar activity and the predicted trend to a solar cycle peak currently around 2013 suggests increased earthquakes, increase d human excitability in the form of action and conflict, increasing inflation an d rising relative returns in hard assets until a relative peak at the solar maxi mum, giving way to a new economic recession. Specifically, the solar peak around 2013 should coincide with extremes for the D ow-gold and Dow-oil ratios and consumer price inflation, before a recession emer ges in which commodities fall harder than stocks and in so doing the two asset c lasses begin their relative secular inversion. Imminent Recession. The first part of this sorry tale was caused by greed and inflated money markets . This gave near full employment and unprecedented growth around the world. The last two years has been caused by the markets realization that you cannot ca

rry on and keep re-inflating the money markets as really there was no-one else l eft to lend to. People max'd out on credit cards, took equity withdrawals. A stu pid scheme was enacted to allow people with no money to own homes backed by larg e mortgages giving to anyone that asked and to a lot that didn't but just signed on the dotted line. In all, this took away the spirit of 'working for a living' and for people to be truly entrepreneurial ability to excel. Everyone became an entrepreneur. Of cou rse this isn't possible. Each person was told that if you followed 'the entrepre neurial game plan' written by 'Rich Quick' you'd make money. Everybody wanted IN . Individuals, companies, banks, governments. For different reasons. Governments wanted big revenue as this bought votes. That's why it was allowed to happen. M any legislators also had vested interests. No one wanted it to end. And finally after several dogs received mortgages there was no-one left to lend to and defau lts started. Restoring economic well-being means strong leadership that moves forcefully in t he opposite direction of present trends with the emphasis on shared sacrifice an d community values. We aren't the first empire to experience this decay and won't be the last. It is only in retrospect that it becomes clear that all empires gravitate from produc ing and creating to finance, debt and lending. The hubris of great empires leads them to believe they have been chosen by God as a special nation destined for e ternal wealth and success. The seventeenth century Spanish empire thought so. Th e Dutch and their glorious maritime empire thought so. The all-powerful British Empire thought so. Do you hear much about these empires anymore? They all sacrif iced productive activities and embraced the glories of a debt based society. They did not pay enough attention to establishing or maintaining a vital manufac turing sector, thereby keeping a better international balance and a broader inte rnal income distribution than financialization allowed." Over the course of 50 years, we've devolved from a production and exporting soci ety into a consuming and borrowing society. A perusal of the chart shows the dramatic downturn has really occurred since 198 0. Goods producing jobs have declined by 6.3 million in the last 30 years, while service jobs have grown by 46.5 million. Who would want to get their hands dirt y on an assembly line when they could shuffle papers, invent CDOs, MBOs, and CDS s, create financial models to destroy the world, bribe rating agencies, file fri volous lawsuits, teach Keynesianism, or use the 60,000 page IRS code to help GE pay no taxes on their $14 billion of income. Alan Greenspan and many other "thou ght leaders" declared that America could succeed through its ingenuity and creat ive thought process. The rest of the world could handle the messy business of bu ilding things. So goes the hubris of an empire that has peaked. To get a clearer view of the conversion from a productive society to a consumption society, conv erting the above chart to a percentage basis is useful. In 1961 America was a well balanced economic powerhouse. Goods production accoun ted for 34.5% of all jobs, with manufacturing making up 27.7% of all jobs. Goods production now accounts for a pitiful 13.7% of all jobs in the country. The sla ck was picked up by financial analysts, accountants, lawyers, tax specialists, a nd bankers. They surged from supporting roles in a production society with 11.7% of the jobs in 1961 to the dominant big dogs today, with 18.9% of the jobs. The rest of the slack was taken up by teachers, school administrators, nurses, caba na boys and waitresses as they surged from 12% in 1961 to 25.3% of all jobs toda y. There is one problem with this shift. We have millions more educators, but ou r school systems churn out millions of functionally illiterate non-critical thin king drones. We have millions more healthcare professionals and are the most obe

se, unhealthy nation on earth even though we spend more per person than any othe r country. A country that employs one quarter of their workers in jobs that do n ot increase the wealth of the country is a country in decline. This shift has al so pushed people into lower paying jobs. The country has decided that bankers, doctors, and teachers are relatively more important to our economy than people who make products, create wealth, and incre ase the productive capacity of the country. Any impartial outcome based assessme nt of these choices would conclude these choices have been an unmitigated failur e. The financial/ banking sector has peddled debt to the masses that didn't realize their standard of living has been declining for 50 years, and blew up the world wide financial system through their greed and fraudulent business practices. We spend more per child on education than any country in the world and test scores are lower than they were 40 years ago. Our children graduate high school with no critical thinking skills and the inability to decipher propaganda from truth. W e spend more per person on healthcare than any other country, but obesity, diabe tes, and heart disease are rampant. Administrative bureaucracy and vast amounts of rules and regulations consume billions in these sectors of our economy. The s imple art of creating and producing things that other people need or want has be en cast aside by a country who thought they could borrow and spend their way to long-term prosperity. The truth is that the country remains in a 50 year death spiral of bad choices, delusion and fraud, created to benefit the few at the expense of the many. The a verage American wallows in a reality of low wages and high debt. Some of this re ality has been self inflicted. Willful ignorance is a choice. Educating yourself to the truth is available to every American. Spending less than you make is som ething everyone can do. But, at the end of the day, the 1% at the top of the foo d chain controls the levers in this country. While the average American has fall en behind over the last 50 years, the ultra-wealthy elite have prospered. The top 1% takes home 25% of the national income and control 40% of the financial we alth in the country. Their lives have improved considerably. Twenty-five years a go, the ruling elite "earned" 12% of the national income and controlled 33% of t he financial wealth. These are the people who control the message. They own the mainstream media. They run the Wall Street banks. They control the Federal Reser ve. They write the laws and the tax code. They control the politicians like pupp ets on a string. An economic system based upon debt and Federal Reserve generate d inflation benefits these chosen few, while destroying the middle class of Amer ica. We've chosen this path and are destined to experience the same fate as Spai n, the Dutch, and Britain. Instead of higher prices meaning lower demand and lower prices increasing demand thus leading to equilibrium and efficient markets, reflexivity takes into accou nt human behavior. The author looks to the Austrians for the greater part of his macroeconomic perspective (along with Hyman Minsky), leading with a quote from Mises and quickly recognizing fractional reserves and central banking as culprit s in bubble creation. Anyone who has negotiated with their spouse over what to l ist their house for or lived through an actual boom and bust will appreciate the biases identified by behavioral economists and herd behavior. President George W. Bush has bestowed on his intelligence czar, John Negroponte, broad authority, in the name of national security, to excuse publicly traded co mpanies from their usual accounting and securities-disclosure obligations. Notic e of the development came in a brief entry in the Federal Register, dated May 5, 2006. What that means folks, is: if J.P. Morgan is deemed to be acting in the name of

National Security or the National Interest THEY [and presumably others] CAN LEGAL LY BE EXCUSED FROM ACCOUNTING. (high risks are overlooked as a routine). These key banks have created ridiculously larger and disproportionate derivative s edifices in key strategic areas of interest rates [bonds], energy and precious metals where the sheer volume of paper trade overwhelms and assigns false prici ng to the underlying physical trade ie. the tail wags the dog. Control of the p ricing in these strategic instruments works hand-in-hand with global U.S. hegemo nic strategy of dollar price settlements in key strategic commodities and the pe rpetuation of supremacy of the Dollar as the world s reserve currency. # A financial industry debt peddling complex that has gained control over the go vernment and media to such an extent they have been able to rape and pillage the American people for three decades, convincing regulatory agencies to allow them 40 to 1 leverage, crashing the financial system through a massive mortgage/deri vatives fraudulent ponzi scheme, threatening the American people into giving the m $4 trillion of taxpayer money, paying themselves hundreds of billions in bonus es for a job well done, and then insisting on lower taxes for their corporations and the rich oligarchs who inhabit these towers of evil in downtown Manhattan. # Wealthy elite who use their existing wealth to control Congress, the media and the financial debt peddling industry, abscond with 25% of the national income a nd control 43% of the financial wealth in the country. At the same time real wag es of middle class Americans have been stagnant for 4 decades, real unemployment exceeds 20%, 45 million people need food stamps to make ends meet, and real inf lation on the things middle class Americans need hovers around 10%. The gap betw een the Haves and Have Nots has never been greater. # The Federal Reserve has boxed itself into a corner and will be unable to extri cate itself with its only weapon - the printing press. It has tripled the size o f its balance sheet to $2.7 trillion, with at least half of the "assets" consist ing of toxic worthless mortgages bought from their Wall Street masters. 0% inter est rates for two and a half years, QE1 and QE2, and allowing banks to fraudulen tly report the value of their loans have failed to jumpstart the economy. Come J une of 2011 they will be faced with a dilemma - PRINT or DIE. If they stop buyin g U.S. Treasury debt, interest rates will go up dramatically. If they keep print ing to buy U.S. Treasury debt, the dollar will continue to fall and inflation wi ll accelerate from its already high level. # The peak oil scenario will mix with the toxic brew of religion. The centuries old war between Christianity and Islam has been gaining strength over the last t hree decades. The revolutions spreading across the Middle East will not die down . They will intensify and create havoc for the existing despotic regimes. The ne w regimes will not be friendly towards the U.S. The combination of peak oil, wit h the fact that 56% of the world's oil reserves are controlled by Muslim countri es in the Middle East provides an unsettling backdrop for the U.S., which contro ls less than 2% of the world's oil reserves. Money expansion (as low interest rates) ultimately destroys capital and leads to lower production in the future. Because the entire process was a monetary illus ion of wealth creation, when in reality it was capital destruction through malin vestment, the coming of the bust should be celebrated, for it is the beginning o f the process of reestablishing the structure of production to reflect the true preferences of the consumer. The sooner the boom ends, the better. The boom destroys capital; the bust replen ishes capital through savings. The economy needs savings, which are the foundati on of production. Remember, five years ago housing was seen as a very safe investment. It was assu

med that the prices of homes never went down, or if they did, it wasn't for very long. But Austrian economics tells us that it is foolish to rely upon past expe rience to predict the future. Just because housing has always been a safe invest ment does not guarantee that it will be in the future.