Category Archives: Dollar Crisis

USA Frack Surpassing Saudi Arabia As Glut Producer

pg-32-fracking-graphic

As vivid as the gas flares in the Texas sky at night, is America’s new-found love affair with fracking. Environmentalists from both the left and among libertarians warn loudly of water contamination disasters and some home owners speak of being rattled by man-made earthquakes, but there is no giving it up the pace now. It’s a whole different world to 2008, when the US oil production snapshot was at a historical low and Sarah Palin was drawing liberal ire declaring that “Drill, Baby Drill!” was the answer to all of America’s problems. Suddenly she seems to have been right, and there is still the Canadian pipeline to be built.

America will see captured output touch 70 billion cubic feet a day in 2014, reaching over 100 billion cubic feet per day by 2040. In the past days, Bills have been tabled in both houses of Congress demanding that the federal government speed up the granting of licences to companies to export natural gas across the Atlantic precisely to reduce the dependency of Western Europe and Ukraine on Russian supplies. Among those wading in is House Speaker John Boehner. “The US Department of Energy’s excruciatingly slow approval process amounts to a de facto ban on American natural gas exports that Vladimir Putin has happily exploited to finance his geopolitical goals,” he said in a statement last week.

Building the infrastructure to export quantities needed to alter the energy politics of Europe will take several years. Nor will changes in America’s foreign policy stance because of its newfound oil fortunes become obvious overnight.

How long America’s shale boom will last is hard to forecast. In Texas, which on its own is set to increase production to 4 million barrels a day this year, the drilling peak still hasn’t been reached, says one expert. But, he suggests, “in the end it’s not the oil fields or the wells that will determine where all this goes. It’s the politicians around the world who set the price and make the markets.” Increasingly, the decisions that matter will rest with the US, as it adjusts to its new status as a glut producer.

Read it all.

Andrew Jackson Abolishes The Central Bank

One hundred and fourscore years ago this month, President Andrew Jackson gave the following speech stipulating why he was closing the United States Bank.

President Andrew Jackson
President Andrew Jackson
A BANK OF THE UNITED STATES is in many respects convenient for the Government and useful to the people. Entertaining this opinion, and deeply impressed with the belief that some of the powers and privileges possessed by the existing Bank are unauthorized by the Constitution, subversive of the rights of the States, and dangerous to the liberties of the people, I felt it my duty, at an early period of my administration, to call the attention of Congress to the practicability of organizing an institution combining all its advantages, and obviating these objections. I sincerely regret that, in the act before me, I can perceive none of those modifications of the Bank charter which are necessary, in my opinion, to make it compatible with justice, with sound policy, or with the Constitution of our country.

Every monopoly, and all exclusive privileges, are granted at the expense of the public, which ought to receive a fair equivalent. The many millions which this act proposes to bestow on the stockholders of the existing Bank must come directly or indirectly out of the earnings of the American people. It is due to them, therefore, if their Government sell monopolies and exclusive privileges, that they should at least exact for them as much as they are worth in open market. The value of the monopoly in this case may be correctly ascertained. The twenty-eight millions of stock would probably be at an advance of fifty per cent, and command in market at least forty-two millions of dollars, subject to the payment of the present bonus. The present value of the monopoly, therefore, is seventeen millions of dollars, and this the act proposes to sell for three millions, payable in fifteen annual installments of two hundred thousand dollars each.

It is not conceivable how the present stockholders can have any claim to the special favor of the Government. The present corporation has enjoyed its monopoly during the period stipulated in the original contract. If we must have such a corporation, why should not the Government sell out the whole stock, and thus secure to the people the full market value of the privileges granted? Why should not Congress create and sell twenty-eight millions of stock, incorporating the purchasers with all the powers and privileges secured in this act, and putting the premium upon the sales into the Treasury.

It has been urged as an argument in favor of rechartering the present Bank, that the calling in its loans will produce great embarrassment and distress. The time allowed to close its concerns is ample; and if it has been well managed, its pressure will be light, and heavy only in case its management has been bad. If, therefore, it shall produce distress, the fault will be its own: and it would furnish a reason against renewing a power which has been so obviously abused. But will there ever be a time when this reason will be less powerful? To acknowledge its force is to admit that the Bank ought to be perpetual; and, as a consequence, the present stockholders, and those inheriting their rights as successors, be established a privileged order, clothed both with great political power and enjoying immense pecuniary advantages from their connection with the Government. The modifications of the existing charter, proposed by this act, are not such, in my views, as make it consistent with the rights of the States or the liberties of the people.

Is there no danger to our liberty and independence in a Bank that in its nature has so little to bind it to our country. The president of the Bank has told us that most of the State banks exist by its forbearance. Should its influence become concentered, as it may under the operation of such an act as this, in the hands of a self-elected directory, whose interests are identified with those of the foreign stockholders, will there not be cause to tremble for the purity of our elections in peace, and for the independence of our country in war. Their power would be great whenever they might choose to exert it; but if this monopoly were regularly renewed every fifteen or twenty years, on terms proposed by themselves, they might seldom in peace put forth their strength to influence elections or control the affairs of the nation. But if any private citizen or public functionary should interpose to curtail its powers, or prevent a renewal of its privileges, it cannot be doubted that he would be made to feel its influence.

Should the stock of the Bank principally pass into the hands of the subjects of a foreign country, and we should unfortunately become involved in a war with that country, what would be our condition? Of the course which would be pursued by a bank almost wholly owned by the subjects of a foreign power, and managed by those whose interests, if not affections, would run in the same direction, there can be no doubt. All its operations within would be in aid of the hostile fleets and armies without. Controlling our currency, receiving our public moneys, and holding thousands of our citizens in dependence, it would be more formidable and dangerous than the naval and military power of the enemy…

It is maintained by the advocates of the Bank, that its constitutionality, in all its features, ought to be considered as settled by precedent, and by the decision of the Supreme Court. To this conclusion I cannot assent. Mere precedent is a dangerous source of authority, and should not be regarded as deciding questions of constitutional power, except where the acquiescence of the people and the States can be considered as well settled. So far from this being the case on this subject, an argument against the Bank might be based on precedent. One Congress, in 1791, decided in favor of a bank; another, in 1811, decided against it. One Congress, in 1815, decided against a bank; another, in 1816, decided in its favor. Prior to the present Congress, therefore, the precedents drawn from that source were equal. If we resort to the States, the expressions of legislative, judicial, and executive opinions against the Bank have been probably to those in its favor as four to one. There is nothing in precedent, therefore, which, if its authority were admitted, ought to weigh in favor of the act before me.

If the opinion of the Supreme Court covered the whole ground of this act, it ought not to control the coordinate authorities of this Government. The Congress, the Executive, and the Court, must each for itself be guided by its own opinion of the Constitution. Each public officer, who takes an oath to support the Constitution, swears that he will support it as he understands it, and not as it is understood by others. It is as much the duty of the House of Representatives, of the Senate, and of the President to decide upon the constitutionality of any bill or resolution which may be presented to them for passage or approval as it is of the supreme judges when it may be brought before them for judicial decision…

It cannot be necessary to the character of the Bank as a fiscal agent of the Government that its private business should be exempted from that taxation to which all the State banks are liable; nor can I conceive it proper that the substantive and most essential powers reserved by the States shall be thus attacked and annihilated as a means of executing the powers delegated to the general government. It may be safely assumed that none of those sages who had an agency in forming or adopting our Constitution, ever imagined that any portion of the taxing power of the States, not prohibited to them nor delegated to Congress, was to be swept away and annihilated as a means of executing certain powers delegated to Congress…

Suspicions are entertained, and charges are made, of gross abuse and violation of its charter. An investigation unwillingly conceded, and so restricted in time as necessarily to make it incomplete and unsatisfactory, disclosed enough to excite suspicion and alarm. In the practices of the principal bank partially unveiled, in the absence of important witnesses, and in numerous charges confidently made, and as yet wholly uninvestigated, there was enough to induce a majority of the committee of investigation, a committee which was selected from the most able and honorable members of the House of Representatives, to recommend a suspension of further action upon the bill, and a prosecution of the inquiry. As the charter had yet four years to run, and as a renewal now was not necessary to the successful prosecution of its business, it was to have been expected that the Bank itself, conscious of its purity, and proud of its character, would have withdrawn its application for the present, and demanded the severest scrutiny into all its transactions. In their declining to do so, there seems to be an additional reason why the functionaries of the Government should proceed with less haste and more caution in the renewal of their monopoly…

I have now done my duty to my country. If sustained by my fellow citizens, I shall be grateful and happy; if not, I shall find in the motives which impel me ample grounds for contentment and peace. In the difficulties which surround us and the dangers which threaten our institutions there is cause for neither dismay nor alarm. For relief and deliverance let us firmly rely on that kind Providence which, I am sure, watches with peculiar care over the destinies of our republic, and on the intelligence and wisdom of our countrymen. Through His abundant goodness, and their patriotic devotion, our liberty and Union will be preserved.

President Andrew Jackson
Speech to Congress
July 10, 1832

Chaos: The Harbinger Of Order

WHEN THE BANKS STOP LENDING and the dollar drops dead, the leonine principles of chaos will pounce upon us, claws poised, teeth bared. But as horrible as that bit of declarative sounds to the victims of chaos, there may still be a ray of sunshine for America and in turn, hope for humanity, and that hope is presented here in an adaptation of a wonderful comment by a reader at American Thinker in response to an article on The Coming Chaos.

John Griffing has stated the obvious and drawn a single conclusion among many possibilities—avoid default of the American debt crisis at all costs. Financial chaos because it cuts to the root of our sense of well-being can be and in most situations is really frightening. People suffer and die when money values go hiking off in many different directions at the same time. But one of the most unnerving problems with modern America is that no one has suffered recently and we are not sure that we can tolerate feelings like hunger and uncontrolled weather in our living rooms. Whole families would have to take to the roads with backpacks as winter approached like migrating birds.

Yet, I am not pessimistic. While Mr. Griffing is correct about bad things happening to good people, I am just as certain that "this too will pass." Why?

spend, spend, spend

Chicago Tribune, 1934. Sound familiar? Took a war to change things, then, too.

Because economic equilibrium will reassert itself. Chaos is too chaotic to last. Organization is an occasional, but natural state of affairs. We know this from the movies of the end of the world. Each time the world reaches a precipice, it draws back in horror. These movies will be our models. We may have to mimic the Amish or become members of a kibbutz, but with great buffalo meat in our bellies and mighty thunder in our throats we will survive as a people. Extra-privileged classes will have to disperse or reorganize to use less energy—like universities and governments, Hollywood and the NFL.

But physicist Stephen Hawking from the strength of his wheelchair has assured us that knowledge is never destroyed, but merely displaced. In the end we will be fine and the world will be at peace again. Bingo! Now I can go back to sleep and have a sweet dream untainted by reality! Tomorrow I will plant my winter collards and broccoli. If global warming doesn't get me first.

Adapted from a comment by J Levy

On Being Prepared: Hunting, Gathering, Survival Food Sources

Watch This Video

Neil_Young
Neil Young
THE FOLLOWING SOURCES are all places where those who wish to prepare for any of a number of possible future calamities can purchase food for long-term storage, including freeze-dried meals, bulk grains, water filters, and other supplies to help my family survive a total economic collapse.

Nitro-Pak is one of the country's top freeze-dried food manufacturers, and it's where we bought our first package of entrees in #10 cans.

The Ready Store stocks a huge selection of foods and food prep items for the long-term food storage pantry. Sign up for their email list to receive emails about weekly sales and special deals.

PrepareCo specializes in water filtration and storage items in addition to grab & go food buckets and bulk grains, from wheat to beans and rice.

Amazon Bulk Foods is a surprisingly good source for packaged foods, from granola bars and cereal to canned goods, to include in your survival food cache.

Food Insurance is an excellent source for large multi-person food packages as well as two-week emergency preparedness kits that come in a convenient, sturdy backpack.

Fearing the worst, or at least, respecting the possibility of something harsh settling your way? What do you need to know? What do you need to do? Need a plan? Read precious and important information about these and other relevant concerns over at the SHTFplan.

Rock legend Neil Young is on record as saying:

‘No one song can change the world. But that doesn’t mean it’s time to stop singing. Somewhere on Earth a scientist is alone working. No one knows what he or she is thinking. The secret is just within reach. If I knew that answer I would be singing the song. This is the age of innovation. Hope matters. But not hope alone. In the age of innovation, the people’s fuel must be found. That is the biggest challenge. Who is up to the challenge? Who is searching today? All day. All night. Every hour that goes by. I know I am.’

Now, that's the spirit!

Forgive Us Our Debts

Ostrich
The Ostrich Revolution
FATHOM A FEW FACTS about our flipping national debt. LBJ's Great Society and a few other distractions—like the Vietnam war—stormed into 1969 and the Nixon era with buckets of deficit spending. Since then, the national debt has grown dramatically each decade, as shown below:

• In the 1970’s, the national debt more than doubled, from $366 billion to $829 billion.
• In the 1980’s, the national debt more than tripled, from $829 billion to $2.9 trillion.
• In the 1990’s, the national debt almost doubled again, from $2.9 trillion to $5.6 trillion.
• In the 2000’s, the national debt is projected to more than double again, from $5.6 trillion to $12.9 trillion (projected national debt at the end of fiscal year 2009).

Just for giggles and lollipops, let's analyze who was in charge of the Spending and Budget Authority—The House of Representatives:

In the 1970's the Democrats held the House all 10 years.
In the 1980's the Democrats held the House all 10 years.
In the 1990's the Democrats held the House for 4 and The Republicans for 6 years.
In the 2000's the Democrats held the House for 10 years.

The only time we ever balanced the budget was when the Republicans held the house in the 1990's during the Gingrich Revolution.

The anti-Constitutional Progressives give the credit to Bill Clinton—who was forced to accept the budgets from the Republican-dominated House. In addition—Clinton only got to a balanced budget by gutting the military and called it the "Peace Dividend" that rather quickly led to a tragic series of missteps that opened the door for 911.

Anyone who blames people who want to balance the budget and make excuses for fools who want to spend money we don't have and then raise taxes—is historically ILL-INFORMED and most often always DEMOCRAT to the core.

However, over time even the Republicans began to pitched gobs of cash wherever they could, just to make a good impression on the debtor nation the Democrats were grooming. Gotta keep them national defense and compassionate conservative votes coming, ya know.

National Debt Made Simple

Budget In Toilet
US Budget is in the Toilet...
THE US CONGRESS SETS a federal budget every year (Before Obama*) in the trillions of dollars. Few people know how much money that is so we created a breakdown of federal spending in simple terms. Let’s put the 2011 federal budget into perspective:

* US income: $2,170,000,000,000
* Federal budget: $3,820,000,000,000
* New debt: $1,650,000,000,000
* National debt: $14,271,000,000,000
* Recent budget cut: $38,500,000,000 (about 1 percent of the budget)

It helps to think about these numbers in terms that we can relate to, so let’s remove eight zeros from these numbers and pretend this is the household budget for the fictitious Jones family:

* Total annual income for the Jones family: $21,700
* Amount of money the Jones family spent: $38,200
* Amount of new debt added to the credit card: $16,500
* Outstanding balance on the credit card: $142,710
* Amount cut from the budget: $385

So in effect last month Congress, or in this example the Jones family, sat down at the kitchen table and agreed to cut $385 from its annual budget. What family would cut $385 of spending in order to solve $16,500 in deficit spending? It's a start, although hardly an easy solution.

Now after years of this, the Jones family has $142,710 of debt on its credit card (which is the equivalent of the national debt). One would think the Jones family would recognize and address this situation, but it does not. Neither does Congress.

The root of the debt problem is that the voters typically do not send people to Congress to save money. They are sent there to bring home the bacon to their own home state. To effect budget change, we need to change the job description and give Congress new marching orders.

It will be brutally hard, but not impossible, to reverse course and to insist the government stop borrowing money from our children and spending it now. In effect, what we have is a reverse mortgage on the country. The problem is that the voters have become addicted to the money. Moreover, the American voters are still in the denial stage, and do not want to face the possibility of going into rehab…

—Marco Nolo

* Neither Congress nor POTUS have offered up a budget these past two fiscal years, contrary to constitutional and traditional mores.

Oi! Oi! Oi!

THERE IS A REASON we do not develop our own energy resources...they are being held as collateral for our massive debts held by foreign countries. When we default you will see Chinese oils workers, miners, and other energy related workers showing up in the USA. They will live in separate autonomous communities apart from us, just like they are doing in Africa.

We are destined to be a resource of the Chinese with our population being irrelevant. In order to create a new world order, the largest pool of free thinking people has to be destroyed.

If you think me insane, look to Iraq. The Chinese are drilling for oil there, the USA is not. We have given them the oil as long as they give us loans. The government, Republicans and Democrats alike, have sold us out. Look on line to find the transcript of the speech given by Chinese General Chi Haotian to see the future the Chinese envision for us.

sopwith

That's an interesting take on things. But man, does it make me say ouch! I wonder how a President Palin, or a President Trump, God help us, might supercede this arrangement.