The Israel Deception

Is the return of Israel in the 20th century truly a work of God, or is it a result of a cosmic chess move to deceive the elect by the adversary?

Showing posts with label economic growth. Show all posts
Showing posts with label economic growth. Show all posts

Saturday, January 14, 2017

Got gold? War on Pensions is officially on as Treasury Department allows unprecedented cuts to benefits

2016 was known as the year for the War on Cash, where India, Venezuela, and even the European Union eliminated currency denominations in the hopes of forcing all their citizens into a cashless system run by the banks.

And despite the fact that here in the U.S. a scheme to ban and eliminate the $100 bill was pushed by two ivory tower economists using the guise of fighting the 'War on Terror', to date all dollar denominated currencies are still considered around the world to be legal tender.

Yet the problem in the U.S., and in many other parts of the world as well, is not money laundering, or citizens using physical cash for illegal means, but instead it is the massive amount of debt that sovereign governments, states, municipalities, and even central banks have that they can no longer afford to service, and which threatens to collapse the entire financial system at both the micro and macro levels.

Attempts to service this debt, and the refusal to allow failed assets and institutions to go bankrupt, has led central banks to destroy the very instruments that savers, retirees, and government pension funds relied upon to pay for promises made to workers in both the public and private sectors.  And as we saw cracks begin last year in the two largest pension funds in the U.S. (Calpers and Central States), 2017 appears here early on to be the year where a War on Pensions will be ratcheted up to maximum levels.

Image: Anatomy of a Failed Liberal State
On Dec. 16, the U.S. Treasury approved the proposal of Cleveland-based Ironworkers #17 Pension Fund to cut the benefits of its 2,000 members by an average of 20%. This is the first time the Treasury has allowed a private pension plan to cut benefits of its members. The Local’s members and retirees will vote on it Jan. 20. If approved, cuts could start Feb. 1. 
Five more pension plans are waiting for the Treasury Department’s decision to reduce pension benefits, Jonnelle Marte reports in the Jan. 5 Washington Post. The cuts proposed would affect tens of thousands of employees and retirees who earned pensions, such as bricklayers, furniture workers and autoworkers. - Larouchepub
The unprecedented move by the U.S. Treasury Department follows the drama Americans saw during the final months of 2016 where first responders from the City of Dallas raided their pension fund when it became known that it was underfunded by a good 40-70%, and where workers and retirees feared there would be no money left to pay out promised benefits.

Yet in addition to the Ironworkers Pension Fund out of Cleveland, OH, several other funds are planning severe cuts to their recipients in the coming weeks, which could begin a chain reaction of cuts around the country for those who paid into their retirements expecting them to be there during their golden years.

Central States Teamsters

Calpers

On top of this, there are already talks in Congress regarding the cutting of pay, jobs, and pension benefits for Federal employees now that the Republicans have seized control over all branches of government.
Federal employees can expect attempts to cut their pay, benefits and rights in the new Congress, as the unified Republican government looks to finally deliver on many failed efforts from previous years. 
The 115th Congress wasted no time pursuing legislation with high impacts on the federal workforce; the first bill approved by the House would require the Veterans Affairs Department to permanently note all reprimands and admonishments on employee records, and a resolution setting the rules for the House this session will allow lawmakers to eliminate federal employees’ jobs and reduce their pay through the appropriations process. 
One likely early target for congressional Republicans, according to multiple sources familiar with their plans, is federal workers’ defined benefit pensions. Lawmakers are expected to address the reform first through the budget reconciliation process, which would allow Congress to institute the cuts without any Democratic support. The budget resolution will likely instruct the House Oversight and Government Reform committee to identify a certain amount of savings, a request committee members can fulfill by proposing significant cuts to federal employees’ retirement benefits. - Govexec
For years states, municipalities, and corporations promised extraordinary benefits that could only work if economic conditions were at their optimum.  But the moment growth and interest rates began to decline, so too did the financial vehicles capable of sustaining large returns to pension funds that needed 5-8% annual increases.  And after eight years of zero interest rates and less than 3% growth, the bugle is sounding to pay the piper, and the ones who will lose are the ones who rely upon it the most.

Got gold?

Saturday, December 17, 2016

India's war on cash and gold through capital controls not as simple is it seems for the future of their economy

Many in the alternative media, including this author, have seen the outrage engendered by the Indian people over Prime Minister Modi's intrusive measures of capital controls where he has virtually declared war on both cash and gold.  And without a doubt, the attempts by Modi to wean the people off their long-standing traditions of a purely cash economy were done with little planning or thought of the consequences they would trigger.

But when you look below the surface you will find that this policy, albeit through a slower and more methodical way, may actually be necessary if not vital to the future of India as it attempts to grow its economy into an international power.

Since 98% of India's commerce is currently done using only cash, it is virtually impossible to determine the true amount of capital that would be available for the country to expand in both growth and investment since the majority of the nation's wealth resides outside their financial system.  And this has been one of the reasons why India has acted primarily as the world's labor pool rather than as a true economic power.

Yet despite their large GDP which ranks them number seven in the world, they still remain behind economies such as China, the EU, the U.S., Hong Kong, and even Russia in growth potential.

Make in India

Earlier this year Prime Minister Modi created a program to try to entice business creation and expansion into India, using their relatively well educated and vast labor pool as the sweetner.  And this move was to try to end a long-standing trend where most of the best and brightest inevitably left India for better opportunities in Europe, Asia, and the U.S..

However, Modi's Make in India program has accomplished only minimal results at best, and in part this has been due to their antiquated financial system, and the fact that most workers expect to be paid in cash rather than through a formal banking mechanism.

Image result for make in india
The Indian economy is at a critical inflection point in its modern history. India’s GDP growth has accelerated to become the fastest of all major economies in the world, with income levels today at China’s c.10 years ago, it is expected that India is now the next big story. Given its favorable demographics and other resources, India has the inherent drivers to sustain 7-8% growth over the medium to long term and the potential to achieve 10%. 
An India that can sustainably harness its core assets and create new ones has the potential to emerge as one of the key drivers of growth and stability in a world faced with increasing global economic and geopolitical uncertainty. In order to attain this position, however, India will need to do what China has historically excelled at, creating significant population-wide savings and channeling these into (reasonably) efficient assets to deliver competitive returns. Doing this requires a robust financial machine ready to finance the nation’s growth. 
Despite the significant growth and evolution of its financial services industry, India’s financial sector continues to be hamstrung by major structural inefficiencies, including an old fashioned state-dominated banking system and, despite increasingly aggressive changes, a lack of financial inclusion for large parts of the population. It is a sector in need of a new vision as the basis of a restructuring so it can play its part in India’s new growth story. 
Recent years have seen a concerted effort by both the Reserve Bank of India (RBI) and the Modi-led government to rapidly grow financial inclusion and bring more and more of India’s poor into the formal banking system. The country’s technology sector has also made a significant contribution by developing delivery systems that reduce transaction costs and spread access by leveraging growing smartphone penetration. 
However, as various factors including the large pile-up of stressed assets in the banking system, the sharp slowdown in industrial credit growth and other measures of inefficiency of the financial system indicate, India still faces significant challenges in creating an effective financial system if it is to stride more aggressively towards its potential. 
While addressing these challenges will undoubtedly be a painful process and require the expenditure of political capital, the prize is significant: potential incremental growth of 2-3% p.a. would set India’s growth on the path to achieve the double digit levels necessary to replicate China’s economic miracle. - Great Pacific Capital
India is hamstrung by the fact that they are a nation steeped deeply in tradition, and it takes decades if not centuries for serious changes to occur.  And this is why Modi's recent move to ban certain denominations of the Rupee in a very short amount of time has resulted in the population rebelling against the policy, and entrenching their distrust in banks to even greater levels.

It is a difficult act to change the confidence of a people in an institution when their natural reaction is to go on the defensive, especially when that policy is instigated from a government that has a history of corruption.  Yet if India is ever going to move ahead and reach their full potential in the global economic system, then both the people and the government will have to find some way to compromise, otherwise India will remain simply a labor pool for the world's other economic powers, and continue to be considered only a second world economy which helps grow the overall wealth of everyone else.

Thursday, July 14, 2016

Like Alibaba's domination over Amazon, Line's social media platform could soon dominate Facebook

There was an interesting statement made back in the 19th century during the industrial revolution that went, I would rather sell 100 shirts at $1 apiece to the Chinese than 10 shirts at $10 apiece.  This is because the potential for profit using the price elasticity of demand model, where by lowering the price you gain much more consumers, is a powerful tool when dealing with the massive populations residing in Asia.


And to date we have seen how this model works in the 21st century, as the e-commerce business known as Alibaba has emerged not only as one of the top 5 companies in the world, but it is also bigger than both Amazon and Ebay combined.

On July 14, the newest Asian powerhouse went public with their own IPO, and already it has the potential to soon dominate Western social media platforms like Facebook.  This is because the Japanese social media company called Line is based on appealing to customer demands and desires, and they have a population potential of several billion users to service.

It took Facebook five years to reach 200 million active users, but only three years for Line to achieve that same number.  And Facebook would have to wait another three years before launching itself as a public IPO, and at a value several dollars less than Line did today at $42 per share.
Line users per quarter

The bottom line is that so far in the second decade of the 21st century, the potential for growth is far greater in Asia than it is in the West, and especially within the United States economy.  And perhaps this is also why China now has the world's largest bank, and in reality the world's largest financial system, and where the future of economic growth no longer resides in companies coming out of the West.

Sunday, April 17, 2016

Consumer trust and hope in the economy falling

Late last week, the Atlanta Fed lowered their Q1 GDP expectations down for the third time in a week to .1%, yet the mainstream continues to dismiss any possibility that the economy is either moving into recession, or that it is already in one.  And at the core of their propaganda is the belief that the consumer is alive and well, and spending money assumed to have been garnered from lower oil prices.
But two new polls and surveys out on April 15 show that not only is this assumption a lie, but that trust and sentiment in the economy is falling rather than growing.
Read more on this article here...

Tuesday, June 19, 2012

Latvia proves that austerity works

In a satirical animation of how austerity is the harbinger of economic growth, the nation of Latvia provides the platform for what can only validate the axiom, when at the bottom, everything is up.



Courtesy of Mark Fiore's Animation