The Mogambo Guru: Stamp of idiocy

The Mogambo Guru: Stamp of idiocy: "... Now, people know that I always take the alarmist, doomsday position because I am naturally paranoid and suspicious, and I have learned that I should never trust any creatures on this planet, especially seeing that half of America's population are Democrats, and as such, they are so demonstrably clueless as to actually declare that it is always the purpose of elected officials to use government money to help more and more people! Even taxing half of all income, and running deficits of trillions of dollars when even that proves insufficient to do it! Wow!

Perhaps I am so dyspeptic about such displays of raw stupidity because I had just found out that the Federal Reserve created another huge US$8.5 billion of new Fed Credit in mid-June, and simultaneously bought up $7.2 billion in US government securities, which had the effect of removing a nominal $7.2 billion in crappy assets (actual worth pennies on the dollar) out of the economy, thus bailing out some halfwit scumbags who owned the toxic assets and would otherwise go bust, and replaced it with cash, recapitalizing the idiots! In One Freaking Week (OFW)!..."

RBS Tells Clients to Prepare For 'Monster' Money-Printing by the Federal Reserve

RBS tells clients to prepare for 'monster' money-printing by the Federal Reserve - Telegraph:
"As recovery starts to stall in the US and Europe with echoes of mid-1931, bond experts are once again dusting off a speech by Ben Bernanke given eight years ago as a freshman governor at the Federal Reserve.

Entitled 'Deflation: Making Sure It Doesn’t Happen Here', it is a warfare manual for defeating economic slumps by use of extreme monetary stimulus once interest rates have dropped to zero, and implicitly once governments have spent themselves to near bankruptcy.

The speech is best known for its irreverent one-liner: 'The US government has a technology, called a printing press, that allows it to produce as many US dollars as it wishes at essentially no cost.'

Bernanke began putting the script into action after the credit system seized up in 2008, purchasing $1.75 trillion of Treasuries, mortgage securities, and agency bonds to shore up the US credit system. He stopped far short of the $5 trillion balance sheet quietly pencilled in by the Fed Board as the upper limit for quantitative easing (QE).

Investors basking in Wall Street's V-shaped rally had assumed that this bizarre episode was over. So did the Fed, which has been shutting liquidity spigots one by one. But the latest batch of data is disturbing.

The ECRI leading indicator produced by the Economic Cycle Research Institute plummeted yet again last week to -6.9, pointing to contraction in the US by the end of the year. It is dropping faster that at any time in the post-War era...

... Andrew Roberts, credit chief at RBS, is advising clients to read the Bernanke text very closely because the Fed is soon going to have to the pull the lever on 'monster' quantitative easing (QE)".

'We cannot stress enough how strongly we believe that a cliff-edge may be around the corner, for the global banking system (particularly in Europe) and for the global economy. Think the unthinkable,' he said in a note to investors...

... The Congressional Budget Office said federal stimulus from the Obama package peaked in the first quarter. The effect will turn sharply negative by next year as tax rises automatically kick in, a net swing of 4pc of GDP. This is happening as the US housing market tips into a double-dip. New homes sales crashed 33pc to a record low of 300,000 in May after subsidies expired.

It is sobering that zero rates, QE a l'outrance, and an $800bn fiscal blitz should should have delivered so little. Just as it is sobering that Club Med bond purchases by the European Central Bank and the creation of the EU's €750bn rescue 'shield' have failed to stabilize Europe's debt markets..."

More Stimulus Funds Needed As U.S. Recovery Falters

Ben Bernanke needs fresh monetary blitz as US recovery falters - Telegraph:
"Federal Reserve chairman Ben Bernanke is waging an epochal battle behind the scenes for control of US monetary policy, struggling to overcome resistance from regional Fed hawks for further possible stimulus to prevent a deflationary spiral.

Fed watchers say Mr Bernanke and his close allies at the Board in Washington are worried by signs that the US recovery is running out of steam. The ECRI leading indicator published by the Economic Cycle Research Institute has collapsed to a 45-week low of -5.7 in the most precipitous slide for half a century. Such a reading typically portends contraction within three months or so.

Key members of the five-man Board are quietly mulling a fresh burst of asset purchases, if necessary by pushing the Fed's balance sheet from $2.4 trillion (£1.6 trillion) to uncharted levels of $5 trillion..."

Oil Prices Plummet On Concerns About U.S. Demand

Oil prices plummet on concerns about US demand - Yahoo! Finance: "Oil prices plummeted Tuesday as ebbing consumer confidence in the economic recovery set off concerns about gasoline demand for the busy summer season.

Benchmark crude oil fell $2.31, or 3 percent, to settle at $75.94 on the New York Mercantile Exchange. Gasoline and other energy prices also retreated..."

15 Facts About China That Will Blow Your Mind

Read the full list here.

Solar Cycle Sparks Doomsday Buzz

Cosmic Log - Solar cycle sparks doomsday buzz: "Don’t panic over those reports that solar storms could cause high-tech disruptions in 2013. But don’t ignore them either. That’s the word from NASA Headquarters' top guy for solar science.

Concerns about the potential for an unprecedented assault from space were stoked last week by a report in London's Telegraph, warning that a super storm could cause 'catastrophic consequences for the world's health, emergency services and national security unless precautions are taken.'

The warnings focus on the 2012-2013 time frame, because that's when the 11-year solar activity cycle is expected to peak. Back in 2006, solar scientists said the coming peak, known as solar maximum or 'solar max,' could be 30 to 50 percent stronger than the last one, based on a computer model that looked at how plasma circulates between the sun's equator and its poles.

Since then, additional reports have added to the concern: In 2008, a National Academy of Sciences study said a severe geomagnetic storm could cause $2 trillion in damage and require as much as a decade of recovery time. In comparison, the damage estimate for Hurricane Katrina is a mere $80 billion or so.

Amid all the hype about a 2012 Maya apocalypse, there's been increasing talk about the potential for a solar superstorm on the scale of 1859's 'Carrington event,' which shorted out telegraph wires, sparked fires and set off auroral displays as far south as Cuba. The fear is that the damage would be more severe in this world of GPS navigation, satellite communications and mobile devices.

The Telegraph's article quoted Richard Fisher, the head of NASA's Heliospheric Division at the space agency's Washington headquarters, as saying that a superstorm would 'cause major problems for the world.'

'It will disrupt communication devices such as satellites and car navigation, air travel, the banking system, our computers, everything that is electronic,' he told the Telegraph..."

Oil Swings to Worsen as Spare Capacity Shrinks

Oil Swings to Worsen as Spare Capacity Shrinks: Energy Markets - BusinessWeek: "Swings in oil prices may worsen over the next five years as OPEC’s shrinking spare production capacity increases traders’ concern about supply shortages.

Oil’s 50-day historical volatility, a measure of how much crude fluctuates around its average price, was at 34 percent on June 25. The measure rose to a record 108 percent in January 2009 after OPEC’s spare production capacity fell to its lowest in almost four years. The group’s idled capacity may drop to 3.9 percent of world demand by 2015 from 6.8 percent this year, according to International Energy Agency estimates...

... OPEC, supplier of 40 percent of the world’s oil, pumped 29.4 million barrels a day in May, with capacity of another 5.5 million barrels idled, according to data compiled by Bloomberg. The group’s spare capacity was as low as about 2 million barrels a day in July 2008, when oil prices peaked, before tumbling as the global recession crimped energy consumption.

Spare production capacity will drop as supplies from outside the group fail to keep up with demand, according to the IEA. The agency estimates world oil usage will rise 6.4 percent by 2015 to 91.93 million barrels a day, while output, excluding OPEC crude, will increase 3.7 percent. That means the world will need more of the group’s oil to meet demand..."

Top 10 Conspiracy Theories

Watch the brief video here.

20 Must-See Charts On America's Disastrous Level Of Government Spending

Treasury Secretary Geithner Says U.S. Can 'No Longer Drive Global Growth'

BBC News - Geithner says US can 'no longer drive global growth': "US Treasury Secretary Timothy Geithner has told the BBC that the world 'cannot depend as much on the US as it did in the past'.

He said that other major economies would have to grow more for the global economy to prosper.

He also played down any differences in policy between the US and Europe regarding deficit reduction.

Mr Geithner was speaking in Washington ahead of G8 and G20 meetings this weekend in Toronto.

He said all members of the group were 'focused on the challenge of [building] growth and confidence', and would be working to this end at the meetings..."

Eat Up – We May Soon Witness The Decline and Fall of a Food Empire

Eat up – we may soon witness the decline and fall of a food empire - The Globe and Mail: "The history of the decline of world powers is also a history of hunger.

In their new book, 'Empires of Food: Feast, Famine and the Rise and Fall of Civilizations' (Free Press) Canadian agriculture expert Evan Fraser and U.S. journalist Andrew Rimas examine how societies from the Roman empire to imperial Britain crumbled as their food supplies crashed.

And we may be facing the same fate, warns Dr. Fraser, a specialist in food security, senior lecturer at the School of Earth and Environment at the University of Leeds and soon-to-be professor of geography at the University of Guelph...

... Food empires tend to emerge in periods of time when, over a couple of centuries, the climate's really quite nice. So the first assumption is that there is good weather, and there is always going to be good weather. Unfortunately, there isn't – human-induced climate change completely aside, the weather is cyclical.

The second one is food empires tend to expand when there's abundant unplowed, fertile, virgin soil all over the place. They expand by cutting trees down, plowing the fields, and grow quickly based on that initial explosion of productivity. That also isn't a sustainable, long-term strategy. In our society, we have masked this with our technology [in fertilization and irrigation], but there's serious doubts whether we'll be able to continue to do that.

The third assumption is more of an economic and ecological one. Farmers specialize on one or two things that they have a unique advantage in. That works on a relatively small scale. But when you say, 'Let's turn all of the Midwest into a grain belt, and California into a tomato field,' you end up with highly efficient systems, but no resilience. Pests, droughts, fires, that sort of thing cause very, very big problems'...

... In our world, we don't keep very much in the way of food in reserve from one year to the next. It's very expensive to store food, so business people and governments don't want to do it for any longer than they absolutely have to. But what that means is we don't have much of a buffer.

In 2008, which had come on the heels of a couple of bad harvests globally, when food prices started to go up, there were very few days left in the reserve of the global food supply. We were down to a very small amount of soybean stocks, and similarly, wheat and rice stocks were very, very, very tight that year.

It's the difference between having your grandmother with tons of food in the cold cellar, or me with a tiny little fridge and one bag of pasta on the shelf. It's that sort of thing on a grand scale..."

Euro 'Collapse' Could Drag Europe Into Conflict

Express.co.uk - Home of the Daily and Sunday Express | UK News :: Euro 'collapse' could drag Europe into conflict: "THE euro is on the verge of a collapse that could drag Europe into conflict, billionaire financier George Soros warned yesterday.

The veteran investor said massive budget cuts proposed by Germany could destabilise the European Union by dragging down its neighbours’ economies.

He said: 'German policy is a danger for Europe. Unfortunately, a collapse of the euro and the European project cannot be ruled out.

'That would be tragic because then Europe would be threatened by the sort of conflicts between states that have shaped European history'...

... Hungarian-born Mr Soros warned: 'The Germans are dragging their neighbours into deflation, which threatens a long phase of stagnation.

'That leads to nationalism, social unrest and xenophobia. Democracy itself could be at risk'..."

Brazil Government Plans To Limit Foreign Land Purchases

This is very important news for those of you out there who are considering expatriation.
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Brazil govt plans to limit foreign land purchases - Yahoo! News: "Brazil's government wants to tighten restrictions on foreign ownership of farm lands in Latin America's biggest country, the Agrarian Development Ministry said Tuesday.

Ministry spokeswoman Denise Mantovani confirmed published remarks by Minister Guilherme Cassel, who said that the government does not want foreigners to buy agricultural land in Brazil.

'We do not need foreigners to produce food in Brazil,' Cassel told the business newspaper Valor Economico. 'This is the policy of President Luiz Inacio Lula da Silva.'

'Because of food security, Brazilian lands must remain in Brazilian hands,' the minister said.

Mantovani said that 10 million acres (4 million hectares) of land had been registered by foreigners as of 2008 and that between 2002 and 2008, foreigners invested $2.43 billion to purchase land.

According to Valor Economico, the decision to put a lid on foreign ownership of land is due to rising world demand for food, water and natural resources..."

Knoxville City Council Approves Backyard Chickens

Knoxville City Council approves backyard chickens - Knoxville News Sentinel: "Knoxville City Council on Tuesday night approved an ordinance to legalize the keeping of backyard chickens within city limits.

The ordinance was sponsored by Councilman Chris Woodhull and approved on a unanimous voice vote. Second reading will be heard in four weeks rather than two weeks to give 'stakeholders' a chance to meet to consider improving the ordinance.

Currently, the practice is illegal under the city code..."

New-home Sales Plunge 33 Percent With Tax Credits Gone

New-home sales plunge 33 pct with tax credits gone - Yahoo! Finance: "Sales of new homes collapsed in May, sinking 33 percent to the lowest level on record as potential buyers stopped shopping for homes once they could no longer receive government tax credits.

The bleak report from the Commerce Department on Wednesday is the latest sign of a precarious housing market that is struggling to recover and could weaken the broader economic recovery. It follows a disappointing report issued earlier in the week showing sales of previously occupied homes had dipped in May.

Analysts linked the sudden drop in new-home sales to the expiration of federal tax credits of up to $8,000. But double-digit unemployment and slow job growth have also weighed on the market, even with mortgage rates at near-historic lows..."

$7-a-gallon gas?

$7-a-gallon gas? - NYPOST.com: "So what does global-warming legislation have to do with the oil spill?

Good question, because such measures wouldn't do a thing to clean up the oil or fix the problems that led to the leak.

The answer can be found in Obama Chief of Staff Rahm Emanuel's now-famous words, 'You never want a serious crisis to go to waste -- and what I mean by that is it's an opportunity to do things that you think you could not do before.'

That sure was true of global-warming policy, and especially the cap-and-trade bill. Many observers thought the measure, introduced last year in the House by Reps. Henry Waxman (D-Calif.) and Edward Markey (D-Mass.), was dead: The American people didn't seem to think that the so-called global-warming crisis justified a price-hiking, job-killing, economy-crushing redesign of our energy supply amid a fragile recovery...

... So Obama and congressional proponents of cap-and-trade spent several months rebranding it -- downplaying the global-warming rationale and claiming that it was really a jobs bill (the so-called green jobs were supposed to spring from the new clean-energy economy) and an energy-independence bill (that will somehow stick it to OPEC)...

... But the new marketing strategy wasn't working. Few believe the green-jobs hype -- with good reason. In Spain, for example, green jobs have been an expensive bust, with each position created requiring, on average, $774,000 in government subsidies. And the logic of getting us off oil imports via a unilateral measure that punishes American coal, oil and natural gas never made any sense at all.

Now the president is repackaging cap-and-trade -- again -- as a long-term solution to the oil spill. But it's the same old agenda, a huge energy tax that will raise the cost of gasoline and electricity high enough so that we're forced to use less.

The logic linking cap-and-trade to the spill in the Gulf should frighten anyone who owns a car or truck. Such measures force up the price at the pump -- Harvard Kennedy School's Belfer Center for Science and International Affairs thinks it 'may require gas prices greater than $7 a gallon by 2020'..."

Is U.S. Now On Slippery Slope To Tyranny?

Is U.S. Now On Slippery Slope To Tyranny? - IBD - Investors.com: "... a democracy needs informed citizens if it is to thrive, or ultimately even survive.

In our times, American democracy is being dismantled, piece by piece, before our very eyes by the current administration in Washington, and few people seem to be concerned about it.

The president's poll numbers are going down because increasing numbers of people disagree with particular policies of his, but the damage being done to the fundamental structure of this nation goes far beyond particular counterproductive policies.

Just where in the Constitution of the United States does it say that a president has the authority to extract vast sums of money from a private enterprise and distribute it as he sees fit to whomever he deems worthy of compensation? Nowhere.

And yet that is precisely what is happening with a $20 billion fund to be provided by BP to compensate people harmed by their oil spill in the Gulf of Mexico...

... With vastly expanded powers of government available at the discretion of politicians and bureaucrats, private individuals and organizations can be forced into accepting the imposition of powers that were never granted to the government by the Constitution.

If you believe that the end justifies the means, then you don't believe in constitutional government..."

More Oil Gushing in the Gulf

Health officials say no swimming off Pensacola - Disaster in the Gulf- msnbc.com: "... Earlier, engineers had to completely uncap the broken oil well spewing into the Gulf of Mexico Wednesday after an undersea robot bumped into machinery being used to collect the spilled fuel. Hundreds of thousands of gallons more poured into the water as crews scrambled to replace a critical component.

The mishap left nothing to stem the flow of oil at its source. A camera recording the well showed huge clouds of black fluid coming out of the sea floor. It was not clear how long workers would need to replace the cap, which took weeks to install..."

Brazen Home-Invasion Robberies Stir Rural Residents to Action

Brazen home-invasion robberies stir Jupiter Farms residents to action: "A trio of would-be robbers who shuffled up a front yard on Alexander Run with a pump-action shotgun last week had the misfortune of confronting an armed homeowner in the driveway. He stared them down until they ran off.

But if they had tried one of the neighbors instead in the rural Jupiter Farms enclave, they might not have had much better luck. In the house next door lives a Vietnam veteran with heavy firepower in his bedroom. At the two houses across the street, the homeowners were packing heat too.

It's no secret that much of an unincorporated swath of pine tree-studded acre lots, elegant mini-mansions, rugged ranch homes and rural individualism - is heavily armed. And after two brazen home-invasion robberies and one attempt earlier this month, some residents are buying new bullets and brushing up on Florida's self-defense laws..."

How to Survive a Solar Storm

How to survive a solar storm: "Scientists at NASA have been warning for some time of the dangers of space weather affecting the earth, and particularly the danger of solar storms. With the sun due to reach the top of both its 22-year magnetic energy cycle and 11-year Sunspot cycle in 2013, there's real danger of magnetic energy damaging electronic equipment.

'We know it is coming but we don’t know how bad it is going to be', Dr Richard Fisher, the director of Nasa's Heliophysics division, told the Daily Telegraph, adding that preparations were similar to those in a hurricane season, where authorities knew a problem was imminent but did not know how serious it would be.

The match-up between the two cycles isn't guaranteed every 22 years, because the 11-year solar cycle is only an average, and sometimes lasts 9, or sometimes lasts 13 years. The last time it did, in 1859, it wasn't such an issue because the earth wasn't anywhere near as technologically developed. This time, however, with a mobile phone in every pocket and a PC in every home, the damage could be rather more severe..."

James Howard Kunstler: Mismanaging Contraction

pMismanaging Contraction - Clusterfuck Nation: "... Right after President Obama gave his vapid speech last week, he traveled to Ohio to brag about how much federal stimulus money was going into 'shovel-ready' highway projects there. I sincerely believe that the last thing we need right now in this country is more and better highways. Every president since Jimmy Carter has acknowledged that there's a problem with our extreme oil dependency, but none of them have made the short leap to understand that we have a more fundamental problem with car dependency. Someone paying attention to the mandates of reality would get the choo-choo trains running from Dayton to Columbus to Cincinnati to Cleveland - and he would tell General Motors to get into the business of making railroad cars so we don't have to import them from Canada.

Reality is telling us to downscale and get different fast. Quit doing everything possible to prop up the drive-in false utopia and all its accessories. Get local. Tighten up. We have no intention of doing that. The idiocy that passes as informed opinion wants the US money managers to kick out the jambs handing out more money created out of thin air to promote a fantasy called 'recovery.' To what purpose? To keep the tailgate parties going down at the Nascar ovals? Over at The New York Times Monday morning, the fatuous Paul Krugman says that 'stinting on spending now threatens the economic recovery.' Earth to Krugman: we're mismanaging contraction. Further expansion is just not in the cards right now for the human race. We don't need more people on the planet and we don't have the means to accommodate them..."

----------James Howard Kunstler is an author and among the leading voices in the charge to be prepared to change how we live as Peak Oil approaches. He is the author of The Long Emergency: Surviving the End of Oil, Climate Change, and Other Converging Catastrophes of the Twenty-First Century as well as the fiction novel World Made by Hand: A Novel.

Buy Solar Power System, Get Free Gun

Buy Solar Power System, Get Free Gun - The Consumerist: "Perfect for off-the-grid survivalists, Bland Solar and Air Inc has a new deal offering every customer who buys a 3kW solar system a free firearm. Best. Cross-promotion. Ever.

The gun comes in the form of a gift certificate, which, 'Depending on eligibility and legal status of customer he or she may use $400 certificate for credit toward gun, rifle, or ammunition or choose $400 rebate'..."

14 Reasons Why The U.S. Government Will Never Have A Balanced Budget Ever Again

14 Reasons Why The U.S. Government Will Never Have A Balanced Budget Ever Again: "The United States government will never have another balanced budget again. Yes, you read that correctly. U.S. government finances have now reached a critical 'tipping point' and things are going to spin wildly out of control from this time forward. Why? Spending on entitlement programs and interest on the national debt are now accelerating at exponential rates. Some time around 2020 they will eat up every single dollar of federal revenue that is brought in before a penny is spent on anything else...

... Over 100 million Americans now receive direct payments from the United States government. For millions of Americans, the American Dream now means getting a government check and kicking back and enjoying life. We have become a nation that is chock full of people that can't take care of themselves and that are totally dependent on the monolithic nanny state that the U.S. government has created.

Now, the truth is that helping the poor and those who cannot help themselves is always a good thing.

Nobody is denying that.

But are there really 100 million Americans that cannot take care of themselves?

Of course not.

The welfare state has gotten wildly out of control and now we are drowning in an ocean of red ink because of it.

In fact, unless the underlying laws for the entitlement programs are rewritten and unless benefits are cut to the bone, it will be mathematically impossible for the U.S. government to balance the federal budget from this time forward..."

Former Shell Exec Predicts Blackouts, Gas Lines

Former Shell exec predicts blackouts, gas lines | TEXAS ENERGY AND ENVIRONMENT Blog | dallasnews.com: "... John Hofmeister, the former Shell executive who made this prediction at a World Affairs Council breakfast on Friday, said he's an optimist. Some of his energy industry friends expect worse, he said.

'Within a decade I predict the energy abyss looks like brownouts, blackouts and gas lines,' said Hofmeister. 'Our federal government, when it comes to energy and the environment, is dysfunctional, it's broken, and it's unfixable in its current form'..."

The Mogambo Guru: Spending fable

Asia Times Online :: Asian news and current affairs: "... as cold comfort as it is, it's not just us. Everybody, in every country, is in the same boat, a nice little yacht made of promises and paper instead of fiberglass and steel, now being tossed and battered by an angry sea of losses and bankruptcy instead of water and waves, which, if you have ever made a paper boat out of a sheet of paper and put it in the water, always results in disaster when it gets soggy and ends up as a wet, useless, misshapen lump of soggy paper, ending your dreams of building a paper boat big enough to hold you so that you could just sail away to someplace where you could stay up as late as you wanted, and you could eat cookies and cake for breakfast if you wanted, anytime you like, and you didn't have to listen to anybody tell you that Keynesian economics is not the piece of crap that it is, or that the Federal Reserve is not the treacherous, traitorous, ruination-by-inflation piece of crap that IT is.

Extending the metaphor (since I seem to be on somewhat of a roll), it is the euro that is in the part of the paper boat that is sinking fastest, although The Economist magazine is ever-optimistic, and says that "the euro's decline, in contrast, should bolster exports for big manufacturers (particularly in northern Europe) and luxury goods companies while boosting tourism across the continent", which makes me wonder where in the hell people are getting the money to go on a European vacation..."

Letter Re: Lessons From The L.A. Lakers Basketball Victory Riot

Letter Re: Lessons From The L.A. Lakers Basketball Victory Riot - SurvivalBlog.com: "I know that several readers have mentioned that they decided to hunker down in the city in their homes rather than bug out if the SHTF. A recent article and video shows what mobs will do when they are happy. Imagine what they will do if they are, hungry, thirsty, and without power for heating or cooling. Fire seems to always be a common denominator in such situations. The last place I would want to be is in or under my house when someone sets it on fire or it catches fire from a nearby house. The bad guys would not even have to use guns.

I worked the Rodney King riots in Los Angeles as mutual aid officer from the northern part of the state. That was a real eye opener. I will never forget being at a housing project (Imperial Courts) with 30, two man units. We were quickly surrounded by hundreds of people screaming at us. We were ordered to flee and we did. We were told that if we had not left, we would of been shot at from the rooftops within a few minutes. After that experience, I always tell people it only takes 1% of the population to disobey the law and the police cannot cope and the situation is totally out of their control.

Hunkering down in the city might work for the short term [in a societal collapse], but long term it is suicide..."

Report: California on 'Verge of System Failure'

Report: California on 'Verge of System Failure': "Think of it as Greece on the Pacific: A place with beautiful scenery where the government spent so far beyond its means that mass layoffs, welfare reductions that leave a million children and the poor and elderly without needed services and failing infrastructure are now the norm.

California’s fiscal hole reportedly is now so large that the state would have to free 168,000 prison inmates and permanently close 240 university and community college campuses to balance its budget in the fiscal year that begins July 1...

... Budget analysts say Governor Arnold Schwarzenegger has no choice but to ask Washington for bailout funds, and that Washington has no choice but to agree because not bailing out the Golden State could put the entire U.S. economy at risk.

It seems that California — which at one time had the third-largest economy in the world — is like the biggest U.S. banks: Too big to fail..."

Rising Food Prices

Food prices to rise by up to 40% over next decade, UN report warns | Environment | The Guardian: "Food prices are set to rise as much as 40% over the coming decade amid growing demand from emerging markets and for biofuel production, according to a United Nations report today which warns of rising hunger and food insecurity.

Farm commodity prices have fallen from their record peaks of two years ago but are set to pick up again and are unlikely to drop back to their average levels...

... The forecasts are for wheat and coarse grain prices over the next 10 years to be between 15% and 40% higher in real terms, once adjusted for inflation... Real prices for vegetable oils are expected to be more than 40% higher and dairy prices are projected to be between 16-45% higher..."

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Venezuela: Hugo Chavez Spearheads Raids as Food Prices Spike - CNBC: "Mountains of rotting food found at a government warehouse, soaring prices and soldiers raiding wholesalers accused of hoarding: Food supply is the latest battle in President Hugo Chavez's socialist revolution.

Venezuelan army soldiers swept through the working class, pro-Chavez neighborhood of Catia in Caracas last week, seizing 120 tons of rice along with coffee and powdered milk that officials said was to be sold above regulated prices...

... Much of the wasted food, including powdered milk and meat, was found last month in the buildup to legislative elections in September. The scandal is humiliating for Chavez, who accuses wealthy elites of fueling inflation and causing shortages of products such as meat, sugar and milk by hoarding food...

... Food prices are up 41 percent in the last 12 months during a deep recession, government figures show, despite the government's growing network of state-run supermarkets that sell at discounts of up to 40 percent and are popular with his poor supporters.

South America's top oil exporter, Venezuela imports about 70 percent of its food and analysts say the economic hardships could give the opposition a boost at the ballot box—although most expect Chavez to retain a reduced parliamentary majority..."

Our Own Extinction is Forecast, But He's Going by Dead Reckoning

Our own extinction is forecast, but he's going by dead reckoning | Herald Sun: "Hear it from Frank Fenner, emeritus professor of microbiology at the Australian National University and the man who helped eradicate smallpox.

'Homo sapiens will become extinct, perhaps within 100 years,' he told The Australian this week.

'It's an irreversible situation.' Blame global warming..."

"Lure People Into That Calm and Then Just Totally F--k 'Em": How All of Us Pay for the Derivatives Market

"Lure People Into That Calm and Then Just Totally F--k 'Em": How All of Us Pay for the Derivatives Market | Economy | AlterNet: "For the Wall Street reform package currently making its way through Congress to work, it has to accomplish two broad goals: It must take a huge bite out of banking profits and end the too-big-to-fail oligopoly that encourages megabanks to take megarisks and stick taxpayers with the tab. Neither of these goals can be accomplished without taking on derivatives -- the wild, unregulated market that brought down AIG. Right now, the U.S. government pays big banks for operating derivatives casinos. If we're going to clean up the derivatives mess, we have to move taxpayer money out of the market.

'The dirty little secret here is that the American government has been subsidizing the derivatives market through the Fed and other avenues since its inception,' says Adam White, director of research for White Knight Research and Trading. 'That's crazy.'

What kind of business is the American taxpayer subsidizing? One with a history of deception and abuse that dates back to its earliest years. Back in 1993 when derivatives casino was first getting off the ground, a Wall Street titan called Bankers Trust Co. sold a derivatives package to drug and chemical giant Procter & Gamble. At the time, Bankers Trust was a powerful, well-respected financial player, which was how it scored big-time clients like P&G. But P&G ultimately took a huge loss on the deal with Bankers Trust, and took the bank to court, where it obtained more than 6,500 tape recordings of horrific derivatives strategizing.

The public release of those tapes was not enough to compel Congress to actually do anything as a matter of public policy, but it was more than sufficient to utterly ruin Bankers Trust. One quote from the tapes, in particular, has become infamous among the nation's financial establishment, but remains obscure to the general public. It's a Bankers Trust salesman, describing the Procter & Gamble deal:

'Funny business you know? Lure people into that calm and then just totally fuck 'em.'

To this day, such techniques remain a central part of the derivatives business, as the SEC's recent fraud suit against Goldman Sachs has made clear..."

Debt Has Taken Down Empires Before, There Is No Reason Why It Won't Happen Again

Ferguson: Debt Has Taken Down Empires Before, There Is No Reason Why It Won't Happen Again:

Coffee Prices Rise 20% in a Week

Coffee prices rise 20% in a week | Business | The Guardian:

Supermarket prices likely to jump as poor harvests in Vietnam and central American plus speculators covering their positions cause leap in cost of robusta coffee


"Coffee prices are rising sharply, largely due to poor crops in Vietnam and central America causing a fall in global supplies.

The International Coffee Organisation (ICO) said world exports between October and April dropped by 8.1% compared with the same period a year earlier – down from 58m bags to 53.3m.

Prices of robusta coffee (the lower-quality bean commonly used in instant coffees) rose by 20% in three days last week to their highest in more than a year. The sudden spike in price was chiefly driven by traders who had bet on a lower price covering their positions.

The Organisation for Economic Co-operation and Development and the UN Food and Agriculture Organisation will publish forecasts tomorrow for market trends in agriculture over the next 10 years and are expected to warn that a growing population, giving land over to biofuels and higher costs are set to drive up a range of commodity prices..."

Monetary Crisis Could Lead to Wild Gold Spike

Monetary Crisis Could Lead to Wild Gold Spike: "When the proverbial fecal matter hit the fan during the week of May 3, one asset shined above all others. It was the humble yellow metal, gold, doing its part in times of panic and crisis. It held up. On May 7, gold closed above $1,200 for the first time in five months — up more than 2.5% during a week in which U.S. stocks endured a freefall. Just five days later, it hit an all-time high of $1,243.10. And the largest physical gold fund recorded its largest inflows since early 2009.

In what follows, we turn our eyes again to gold, that curious inert metal with the monetary heritage. The topic comes with baggage. It’s hard as an investor to look at it objectively. Many investors make a case for gold laden with ideological fury over the government’s printing press. These investors are always saying buy gold. Their arguments are timeless, but not timely.

Of course, buying gold all the time is not really an investment strategy. If you bought gold in the 1980s and 1990s, your return was abysmal. So, as with all assets, there are times when gold is a really good buy and there are times when it is not. Sounds obvious, but many people seem to want to think that gold is an exception to the order of things. It isn’t.

But how do you know if gold is cheap? Well, intelligent people usually advance a couple of arguments: ..."

Why the United States Will Default on Its Debt

Steve Quayle : "It is clear to me the issue of a United States debt default is not a fringe topic anymore. Even two or three years ago, if you brought the subject up you would consigned to the outer limits of acceptable economic views. In fact, you would have been viewed as the economic version of someone who thought the earth was flat. This is no longer the case. Since the Obama administration seems intent on running 1.5 Trillion federal deficits yearly, reasonable people can safely ask 'How does the USA intend to pay this debt off?' Given the recent comments by Chinese officials, as well as the less than stellar performance of recent US Treasury bond auctions, it would seem a US government debt default is causing concern. Being a long standing howling voice in the wilderness on debt issues, I am glad others are finally starting to see what I saw several years ago..."

Eating Well On $1 A Day

Eating Well On $1 A Day - Grocery Coupon Guide: "I was talking with my sister and explaining to her that with couponing, I think that I could live on $1 a day for food and have plenty to eat. She looked at me skeptically thinking that I was exaggerating.

'No, really, I could live on $1 a day and not be hungry,' I said.

'All you would eat is cereal and junk food,' she countered. That is not a healthy diet for a month.

'I think I could have a fairly healthy diet on $1 a day,' I replied. “At least a lot healthier than you think.”

'Including fruits and veggies?' she asked, the skepticism in her voice coming through again.

'Including fruits and veggies,' I said.

'You couldn’t last a month,' she said sure of herself.

Thus the 'Eating Well on $1 A Day' challenge was born with the following rules in place..."

Volcker Warns: We Are Running Out Of Time

Volcker Warns: We Are Running Out Of Time: "America is running out of time to fix its huge economic and fiscal problems, warns former Fed chair Paul Volcker, who now heads a financial advisory board to President Obama.

'Restoring our fiscal position . . . sorting out a reasonable approach toward limiting carbon omissions, and producing domestic energy without unacceptable environmental risks all take time,' Volcker writes in The New York Review of Books.

'We'd better get started. That will require a greater sense of common purpose and political consensus than has been evident in Washington or the country at large.'

The risks associated with the virtually unprecedented levels of public debts as the U.S. emerges from recessions are evident, Volcker notes, and must be effectively dealt with now. Dealing with uncontrolled borrowing is 'not a matter of intellectual awareness but of practical confrontation,' he says..."

The End Of The World As We Know It

The end of the world as we know it - Science, News - The Independent:

Forget man-made threats – the catalyst for the apocalypse will come from outer space, warns astronomer Chris Impey

"Apocalyptic thought has a tradition that dates to the Persian prophet Zoroaster in the 14th century BC. Recently, anxiety has grown over the prediction of the end of the world in the Mayan calendar.

It's true that the Mayan odometer will hit zeros on 21 December 2012, as it reaches the end of a 394-year cycle called a baktun. But this baktun is part of a larger 8,000-year cycle called a pictun, and there's no evidence that anything astronomically untoward will happen as the current baktun slides into the next. However, that hasn't stopped the feverish speculating that sells books and cinema tickets.

What kind of catastrophe would it take to end the world? Astronomical intruders provide a potentially serious threat..."

Too Much Risk: $1.2 Quadrillion Derivatives Market Dwarfs the World's GDP

Too Much Risk: $1.2 Quadrillion Derivatives Market Dwarfs the World's GDP - DailyFinance: "One of the biggest risks to the world's financial health is the $1.2 quadrillion derivatives market. It's complex, it's unregulated, and it ought to be of concern to world leaders that its notional value is 20 times the size of the world economy. But traders rule the roost -- and as much as risk managers and regulators might want to limit that risk, they lack the power or knowledge to do so.

A quadrillion is a big number: 1,000 times a trillion. Yet according to one of the world's leading derivatives experts, Paul Wilmott, who holds a doctorate in applied mathematics from Oxford University (and whose speaking voice sounds eerily like John Lennon's), $1.2 quadrillion is the so-called notional value of the worldwide derivatives market. To put that in perspective, the world's annual gross domestic product is between $50 trillion and $60 trillion..."

20 More Signs Of A Full-On Economic Collapse

20 More Signs Of A Full-On Economic Collapse: "So just how bad is the U.S. economy? Well, the truth is that sometimes it is hard to put into words. We have squandered the great wealth left to us by our forefathers, we have almost totally dismantled the world's greatest manufacturing base, we have shipped millions of good jobs overseas and we have piled up the biggest mountain of debt in the history of mankind.

We have taken the greatest free enterprise economy that was ever created and have turned it into a gigantic house of cards delicately balanced on a never-ending spiral of paper money and debt. For decades, all of this paper money and debt has enabled us to enjoy the greatest party in the history of the world, but now the bills are coming due and the party is nearly over.

In fact, things are already so bad that you can pick almost every number and find a corresponding statistic that shows just how bad the economy is getting.

You doubt it? Well, check this out..."

REMINDER: Sale on Mountain House Foods - June 15th-30th!

Just a reminder regarding the sale on Mountain House brand foods at Ready Made Resources we told you about last week.

Any multiple of 6 cans will be 25% off + free shipping!

And,

Broken cases will also be 25% off!

The promotion began yesterday, June 15th and will expire on June 30th.

Flash Flooding Once Again Impacting Many, Including My Home State of West Virginia

Luckily for me, my homestead is located on top of a hill. Some are not so lucky.

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Flash flood swamps region - Local News - Bluefield Daily Telegraph, Bluefield, WV: "A sudden storm surge early Sunday morning pushed already swollen streams out of their banks in McDowell County [West Virginia], and sent scores of families out of their homes in search of shelter.

'The water inside our home was knee deep when my 3-year-old daughter woke me up in the middle of the night,' Elmer Hankins, 32, of North Welch said. When he realized the immediacy of the situation, Hankins got his daughter and two young sons out of their home, but they couldn’t go far.

'I lost everything,' he said. 'We lost everything in our home ... all our food and our vehicle. We were lucky to get out.' Hankins lived in a home on Stewart Street, or Route 16 [in Welch, West Virginia]. Most of the road in front of his home had been washed away by the flash flood..."

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Flash flooding impacting many | WSLS 10: "Southern West Virginia has also dealt with heavy rain. Cleanup continues after heavy downpours. Homes, businesses and roads were destroyed and mudslides even occurred. Some business owners that lost their entire inventory say they will not open back up and deal with this again..."

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West Virginia Prepares for More Flooding - WVNS-TV - WVNSTV.com: "We're not out of the woods yet when it comes to flooding in the state.

West Virginia's Division of Homeland Security is taking a look at the overall damage from this weekend's rains and what steps the state needs to take to address the possibility of even more flooding...

... And, according to our meteorologist Ari Salsalari, it won't take much to produce round-two...

... The danger isn't over and they're urging residents living near streams and in flood prone areas to be vigilant..."

James Howard Kunstler: Fierce Urgency

Fierce Urgency - Clusterfuck Nation: "The exquisite morbidity of the BP oil spill has concentrated the collective national mind like few other events in this ongoing long emergency. How many times a day does it occur to you -- perhaps while sitting in traffic, or oogling some girl in a nearby cubicle, or cruising the freezer stacks in the supermarket -- that one mile deep in the Gulf of Mexico that crude is just blasting away into the deep blue sea? Anyway, it troubles my hours...

...I know I'm not alone in the creepy feeling that really nothing has been sorted out and the world is waiting to get hammered six days to Sunday by the consequences of living too large for too long...

... My guess is that the gestures of reform will leave reform completely unfinished by the time the high water of events starts rushing back in. All the structural fault-lines will remain as even more decay sets in and new cracks appear. Something is gonna give this summer.

It all comes down to one thing: the world is mismanaging contraction. The world will not solve the problems of massive over-complexity with more complexity. But scaling down is apparently not an option, though it will happen whether we participate or not. The USA is like Herman Melville's Bartleby the Scrivener who, when asked to do anything, replied, "I prefer not to." His preference led him to a pauper's grave..."

----------James Howard Kunstler is an author and among the leading voices in the charge to be prepared to change how we live as Peak Oil approaches. He is the author of The Long Emergency: Surviving the End of Oil, Climate Change, and Other Converging Catastrophes of the Twenty-First Century as well as the fiction novel World Made by Hand: A Novel.

More On The Relentless Gulf Oil Leak

Scientists up estimate of leaking Gulf oil - Disaster in the Gulf- msnbc.com: "Scientists provided a new estimate for the amount of oil gushing from the ruptured well in the Gulf of Mexico on Tuesday that indicates it could be leaking up to 2.52 million gallons of crude a day.

A government panel of scientists said that the ruptured well is leaking between 1.47 million and 2.52 million gallons daily of oil. The figures move the government's worst-case estimates more in line with what an independent team had previously thought was the maximum size of the spill..."
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Obama seeks to take charge of Gulf disaster - Disaster in the Gulf- msnbc.com: "President Barack Obama prepared to address the nation Tuesday with an 'I'm in charge' message as a blown-out BP well deep in the Gulf of Mexico gushed crude oil for a 57th day, creating an unprecedented environmental and economic disaster.

Obama's speech from the Oval Office comes as a new poll shows a majority of Americans disapprove of how he has handled the Gulf disaster, though far more blame BP for what people call a sluggish two-month response..."