Fraudonomics- How our entire ecnomy is built on confidence (fraud)

[brigadeer]

I came across an article today that was one of the best I have read in quite some time. I have posted the link to the article below:

http://www.nypress.com/article-21163-fraudonomics.html

The basic premise of the article is that while we (libertarians, free thinkers, constitutionalists, tea party members, Ron Paul supporters, End the Fed'ers, you get the idea......) continually ask and push for reform and transparency in our economic markets due to all the fraud we see around us, what would happen if we really got what we wanted? In the end, the author posits that fraud has become so endemic in this country that it' s woven it's way into America's DNA, forming a symbiotic relationship that can't be undone without killing off the host.

I for one hope that's not the case, but I fear it may be the truth that no one wants to admit.

Copied and pasted the article below for your viewing pleasure:

Fraudonomics
The big dirty secret of why you should worry about a fraud crackdown more than Goldman Sachs—revealed for the first time by an anonymous private equity 'hypocrite' and 'liar.'
By Mark Ames

There was a strange moment last week during President Obama’s speech at Cooper Union. There he was, groveling before a cast of Wall Street villains including Goldman Sachs chief Lloyd Blankfein, begging them to “Look into your heart!” like John Turturro’s character in Miller’s Crossing…when out of the blue, the POTUS dropped this bombshell: “The only people who ought to fear the kind of oversight and transparency that we’re proposing are those whose conduct will fail this scrutiny.”

The Big Secret, of course, is that every living creature within a 100-mile radius of Cooper Union would fail “this scrutiny”—or that scrutiny, or any scrutiny, period. Not just in a 100-mile radius, but wherever there are still signs of economic life beating in these 50 United States, the mere whiff of scrutiny would work like nerve gas on what’s left of the economy. Because in the 21st century, fraud is as American as baseball, apple pie and Chevrolet Volts—fraud’s all we got left, Doc. Scare off the fraud with Obama’s “scrutiny,” and the entire pyramid scheme collapses in a heap of smoldering savings accounts.

That’s how an acquaintance of mine, a partner in a private equity firm, put it: “Whoever pops this fraud bubble is going to have to escape on the next flight out, faster than the Bin Laden Bunch fled Kentucky in their chartered jets after 9/11.”

And that’s why this SEC suit accusing Goldman Sachs of fraud is really just a negotiating bluff to give Obama’s people some leverage—or it’s supposed to be, anyway—according to the PE guy. He dismissed all the speculation that the fraud investigations would turn on other obvious villains like Deutsche, Merrill, Paulson & Co., the Rahm Emmanuel-linked Magnetar and so on.

“You don’t get it, Ames. Even Khuzami, the SEC guy in charge of the Goldman case, is a fraud; the ****er was Deutsche’s general counsel when they pulled the same CDO scam as Goldman. You have no idea how deep this goes.”

And it’s clear that a lot more people here are aware of how fundamentally rotten things are but they’re not willing to face the big fraudonomics bummer yet, preferring instead to stick with specific accusations.

My position on this was, “Good, throw the book at those crooks too, I don’t see what the problem is here.”

This was exactly what I argued a week ago, during a verbal slapfight with that acquaintance of mine. We were making a scene in a Midtown yuppie restaurant, arguing over just how much damage Wall Street had caused, and what to do about it.

His position was indefensible, and he knew it, so he switched tactics:

“OK Ames, which bankers would you throw the book at? Because you’re arguing that they’re all guilty. So which ones do you go after? Two of them? Three? Half of them?”

“Every last one of them. Lock ’em up in one of their private prisons.”

“Not gonna happen, Che.”

“Che? Me? Listen, Scarface, I’m about law and order. Don’t any of you PE degenerates believe in that anymore?”

“OK, here’s the deal, Che. I’m going to walk you through this nice and slow so that even an agave-sweetened hippie like you can understand this. Stick with me, this is gonna be a little complicated. Ready?”

And so he began:

“Let’s say the government decides one day, ‘You know, we oughta listen to Che here, let’s throw the book at every firm and every executive that our people can make a case against. Because you know, gosh, it’s all about rule of law and blind justice, just like Che says.’ OK, so now this means indicting just about every serious player in finance, so they take down Goldman Sachs, they take down Citigroup, JP Morgan, BofA… and they also serve all the big funds who are at least as guilty, if not more. So they shut down Pimco, Blackrock, Citadel… maybe they indict Geithner and Summers, haul in some of Bush’s crooks… right?”

“Too bad they don’t serve popcorn here, this is getting good.”

“OK, now guess what you’ve just done? You’ve just caused the markets to completely tank. Remember what happened after the Lehman collapse? Remember how popular that made every politician in Washington? Still wondering why they coughed up a trillion bucks? They were scared for their lives; that’s why they voted for that bailout. You’d have done the same ******* thing. But if we go after everyone guilty of fraud and theft, the market crash this country would see would make 2008 look like Sesame Street. Open that can of worms labeled ‘Fraud’ and the whole ****ing economy collapses. You may as well prosecute people for masturbating. No one will know where the fraud investigation stops and who will be charged next—everyone will try to cash out, and the markets will tank to zero. And guess what happens when the markets tank to zero? Every ****ing American with a retirement plan, or an investment portfolio, or a 401k—every state pension plan in the country, every teacher’s pension fund, every fireman’s pension—every last one of them will be wiped out. That’s what the Lehman collapse taught us.”

“Us? It didn’t teach us anything but that this country is run by maniacs.”

“Jesus H. Christ, Ames– you’re even more clueless than the idiots who managed the Lehman collapse. I mean, didn’t everyone get it how badly those idiots screwed up with Lehman? It was the biggest screw-up this hemisphere has ever seen. You had Secretary Paulson and Fed Chief Bernanke scratching their asses not knowing what to do, so then they go, ‘OK, we’re supposed to be a free market economy, and we’re supposed to be the Republicans—let’s try something different for a change since nothing else is working. Let’s go out on a limb and actually give this “free market” thing a whirl. Who knows? Maybe the “free market” really works the way we always say it does. Nothing else seems to work, let’s let the free market decide Lehman’s fate. Maybe corporate-socialism isn’t the answer.’ So they hung Lehman out in the free-market, and BAM! The. sh*t. Hit. The. Fan. No sh*t, dudes—the free market is for suckers, didn’t your daddy teach you idiots that? Not only did Lehman collapse—everything collapsed; confidence in the entire system collapsed. And here’s what I’m trying to explain to simpletons like you: Our economy is just a confidence game. Don’t ask me how it got this way, don’t care.”

I tried saying something insulting to him, but he just talked right over me, lurching forward baring his laser-whitened teeth.

“I’m sure you have the answer, you and Ron Paul and all the other pot-smoking libertarian do-gooders have it all figured out. But what I’m saying is, no confidence means end of the confidence game. That’s what Lehman showed. Every single player in finance suddenly had to face the fundamental problem—this whole ****ing economy is built on fraud and lies and garbage. So when Lehman collapsed, every single player panicked, going, ‘If Lehman was nothing but a Ponzi scheme—and I know what I’m running is a Ponzi scheme—holy sh*t, that means everyone else is running a Ponzi scheme too! Run for the exits!’ No one trusted anyone else, everyone pulled out, and the entire global economy collapsed just like that. And that meant your parents, my parents, every teacher, every fireman, every person in the country going into retirement, every price on every asset—wiped out.

“And here’s what I’m trying to get you to understand: In the grown-up world, when an entire country’s savings accounts are wiped out because of some do-gooder and his law books and his Thomas Jefferson ‘What about free and fair markets?’ crap, that is a big problem—people don’t give a **** about Jefferson and ‘free and fair markets,’ they just want their savings to be worth something. And people are right: Jefferson was an imbecile. He should have been a folk singer, not a Founding ****ing Father. But that’s another issue that’s over your head—the point is, the guy who destroys this economy because it’s ‘the right thing to do’ will have to flee for his life, and whatever president or political party was in power when that decision was made will be out of power for the next 200 years. That’s why Washington panicked and passed ‘the bailout,’ they didn’t want to be the fools whom all the Ponzi victims blame for tanking the Ponzi scheme, so they broke the glass and pumped up a newer, bigger Ponzi scheme. It was an expensive 14 trillion dollar lesson in, ‘Stay the **** away from free-market experiments, assholes!’ How naive are you people to actually believe that ‘free market’ crap? The problem is when people in power are stupid enough to listen to guys like you: all the do-gooder libertarians and the do-gooder free-market Republicans who forgot that they’re supposed to lie. Hello!”

“Libertarian, me? Since when was I ever a libertarian?”

“That’s my point: Fools like you don’t even know who you are anymore. They forgot that they’re supposed to lie about all that libertarian free-market sh*t, keep it far the **** out of policy. But instead of just lying about free-markets while secretly propping up Lehman, the idiots actually tried pulling off a ‘free-market’ miracle, and we had to pay $14 trillion just to find out what I could have told them for no fee at all, which is: ‘Hey, assholes, you’re supposed to be hypocrites, OK? You’re supposed to be two-faced free-market liars, not libertarian Quakers! You’re not supposed to believe in anything—your job is to get up in front of the public and lie about free markets and the rest. Period.’

“That’s it, how ****ing hard is it? Look, watch my face: Say one thing out of one side… and do the other out of the other side. Got that? Let everyone else whine and cry about, ‘Ooh, that’s not fair, ooh, that’s a bailout, that’s socialism, that’s corruption.’ That’s what losers do—they whine. You, for example, Che—you whine all the time, and look at you… Can you pay the bill for this meal? Is there a libertarian on earth who can afford to buy a decent meal in Manhattan? And now, look at me: I’m a hypocrite. Hell yes I am! I lie every day of my life, I lie to myself in my sleep. Hell, I’m lying to you right now, in fact I don’t even know what the **** I’m saying anymore because I’m so used to lying. And yet—who’s the guy with the black card? Who’s the one who’s going to pick up the check tonight? Guys with power, guys like me, we lie. You got that? ‘Lie’ as in ‘My Lai’ the massacre—as in, ‘My Lai you long time, me so free-markety.’ You distract the dumbsh*ts with free-market B.S. because hey, for whatever reason, that’s what the public likes to hear, it doesn’t really matter what lie you feed them so long as it’s the lie that puts them in a trance. And then behind the scenes, you do the very opposite: You fix the game, you cover up this problem here with those funds there, you move sh*t around, you skim budgets and you subsidize the system, you cover up the bad sh*t and once in a while throw a has-been to the wolves to keep the public entertained—that’s the way the system works, and anyone who’s an adult understands that. And everyone who doesn’t understand that can go form an online libertarian chat group and complain with all their little libertarian friends about free markets and Jekyll Island and ‘Wahhh! It’s not not fair, waahhhh!’”

“What’s with the libertarian accusation?”

“It’s just that you all sound the same to me. Libertarians, hippies—is there really a difference? You all whine alike: ‘It’s not fair, man! Ooh! You can’t do that, it’s fraud, it’s corruption, ooh no!’ Or: ‘It’s the income inequality, man; Goldman Sachs controls us all man; it’s socialism for the rich; it’s all too scary for my retarded 5-year-old libertarian brain!’ Seriously, anytime I meet libertarians like you—”

“Listen—I’m not a ****ing libertarian, OK? I want free handouts. How clear do I have to make this? Me—handouts. Me—Big Government. I want to collectivize your productive cash, because I am a resentful parasite. Are you capable of processing a single word of what I’m saying to you, Spaz?”

“Uh-huh, sure, whatever. Here’s the thing: I think it’s great that you and your friends memorized Road to Serfdom in between Star Trek episodes—no really, I’m happy for you. Yeah, we’re all so proud. But here’s the thing: We grown-ups are really, really busy now trying to sort out the free-market mess you made with that Lehman move of yours. Yeah, so why don’t you run along to your libertarian chat rooms and have your little debates about Jekyll Island and the gold standard, because it really means a lot to us. And report back to me as soon as you have it all figured out, m’kay? Just get the **** out of my face and leave the adults alone.”

It got a lot more vicious and personal than this, but when our verbal slap-fight ended—and he paid the bill—I thought about what he said, and it made a lot more sense. Fraud has become so endemic in this country that it’s woven its way into America’s DNA, forming a symbiotic relationship that can’t be undone without killing off the host. [See below: Fraudonomics: 10 Fun Fraud Facts] If they push it just a little too hard, the entire American economy could crash, asset values could tank, and that means tens of millions of extremely pissed off retirees and Baby Boomers. As the Wall Streeter put it: “Whoever is responsible for bursting this latest bubble by exposing all the fraud—and tanking all the markets—will not only be out of power for at least a generation, but they’ll all have to get radical reconstructive surgery on their faces and seek political asylum somewhere remote. No one wants to be that guy, and that’s why it’s not going to happen.”

That may be true, but all bubbles do eventually burst, all Ponzi schemes do collapse for good at some point. The only question is when. For those of us not on the verge of retiring, the sooner we have this day of reckoning and get it over with, the better.

[Glass]

I've seen a bit of this lately. Its the usual thing. The system is corrupted, you aint gonna fix it so get yourself down the hardware store, grab some lumber, build a bridge and get the F@#$ over it.

Thats what thieving lying shits do. That is what they always do. IMO That friendship would be over big time. Blatantly saying he is going to rob you and hs the moral authority to do it because he won't be brandihing a gun.

Some people think they are at the top of the food chain and are proud of it ad their ability to feast on the lesser people on the food chain. Some people don't think there needs to be a food chain. Hunters Vs Farmers, Parasites Vs Producers. The parasites think we need their financial system and can't imagine if it were no longer there.

This bit here gets to the crux of it:



“Let’s say the government decides one day, ‘You know, we oughta listen to Che here, let’s throw the book at every firm and every executive that our people can make a case against. Because you know, gosh, it’s all about rule of law and blind justice, just like Che says.’ OK, so now this means indicting just about every serious player in finance, so they take down Goldman Sachs, they take down Citigroup, JP Morgan, BofA… and they also serve all the big funds who are at least as guilty, if not more. So they shut down Pimco, Blackrock, Citadel… maybe they indict Geithner and Summers, haul in some of Bush’s crooks… right?”

“Too bad they don’t serve popcorn here, this is getting good.”

“OK, now guess what you’ve just done? You’ve just caused the markets to completely tank. Remember what happened after the Lehman collapse? Remember how popular that made every politician in Washington? Still wondering why they coughed up a trillion bucks? They were scared for their lives; that’s why they voted for that bailout. You’d have done the same ******* thing. But if we go after everyone guilty of fraud and theft, the market crash this country would see would make 2008 look like Sesame Street. Open that can of worms labeled ‘Fraud’ and the whole ****ing economy collapses. You may as well prosecute people for masturbating. No one will know where the fraud investigation stops and who will be charged next—everyone will try to cash out, and the markets will tank to zero. And guess what happens when the markets tank to zero? Every ****ing American with a retirement plan, or an investment portfolio, or a 401k—every state pension plan in the country, every teacher’s pension fund, every fireman’s pension—every last one of them will be wiped out. That’s what the Lehman collapse taught us.”


Personally I say bring it on. What's that guy going to do??? Hope he's got a gun but I guess in Downtown NY it ain't going to happen.

[woodman]

I agree 100% Glass. Bring it on. Why live a lie?

[cigarlover]

He is spot on. The important fact that he doesnt realize is that eventually it has to collapse. It either collapses now or it collapses after hyperinflation. Neither is going to be painless.

A couple of points I would like to make.

What is the true value of a home? I know I have thrown this out several times but I'll do it again. Take away the 30 yr mortgage and what is the true value of that home?

I remember back earlier this year when Geithner was on Face the nation or some show on Sunday morning. He flat out said without the bailout and without the banks a house would be worth whatever someone has the cash to pay for it. My guess is at least 80% of America lives week to week. That means all the cash has already been sucked out of the economy by the banks and the Gov. and big business. Thats also the reason the US is now 14 trillion in debt. We dont produce anything except war here so most of the money coming into the economy is from the Gov. Americans are and have been tapped out for a long time. There is no more that they can borrow and spend so the gov has picked up the slack. That too will come to an end and sooner rather than later. So again whats the true value of a home? Probably about 10-20% of its current value.

Why do you think they want to illegals here so badly? Just more suckers to prey on. Hopefully some of them can afford a mortgage and pay into the system to keep it propped up. Thats what the gang in DC is hoping for anyway. The big problem with that is there arent any jobs. They have all been shipped overseas. One of the last big areas of production was housing. Housing is dead and will be for the rest of my lifetime anyway. We have the largest segment of society retiring right now and when they die off and are gone there will be a glut of housing out there. The only way to take up the slack on that glut is to allow many more into the country to try and purchase them but again we need jobs.

In the end, everything will collapse. I dont know how or when but it will happen. I'm in my mid 40's and I dont even know if it will happen in my lifetime but eventually it has to happen.

My best guess is they create a new world currency but even that is only going to delay the inevitable because Gov wont spend within its limits.

Another problem we have is this. We have all these large corps promising all these pensions and retirement plans. Wall street sucks off the retirement money in the pension funds so theres nothing left there. The large corps who fund these accounts can only fund them for so long before the big lie comes back to bite em. Look at GM.. Promises were made to take care of employees forever but when the bottom fell out the only thing backing those promises was gov money. I'm still not sure how they managed to back GM's pensions with Gov money but taxpayers are funding GM retirees now. This is only 1 company of the thousands out there making these promises. Eventually there wont be anyone left to skim off of anymore and the whole thing collapses.

Yes the entire economy is built on lies but eventually those lies come home to roost. All they are doing now is buying time. In 11 years we have gone from a national debt of 1/2 a trillion to 14 trillion. The 10 years they bought was pretty expensive. How much are the next 10 years going to cost and will they be able to borrow that much? The entire world economy is only 56 trillion I think so how much more can we really borrow?

[Glass]

CL your post sums up a grim reality. Unfortunately the cost won't be counted in dollars but in lives. We "know" that here. Some will never "know" it. The tusnami will wipe them out before they know what hit them.

[jedemdasseine]

What is the true value of a home? ....Take away the 30 yr mortgage and what is the true value of that home?




Bravo.

This question is incredibly important to wrap one's head around, and reflecting upon it leads one to just about every other incredibly important point to understanding the economy. As you pointed out, Geithner let slip the reality of the situation. Down the rabbit hole we go.......

[woodman]

Gem of a post CL.
Quote:
"Why do you think they want to illegals here so badly? Just more suckers to prey on. Hopefully some of them can afford a mortgage and pay into the system to keep it propped up. Thats what the gang in DC is hoping for anyway. The big problem with that is there arent any jobs. They have all been shipped overseas. One of the last big areas of production was housing. Housing is dead and will be for the rest of my lifetime anyway. We have the largest segment of society retiring right now and when they die off and are gone there will be a glut of housing out there. The only way to take up the slack on that glut is to allow many more into the country to try and purchase them but again we need jobs.
End Quote

There always comes a tipping point when the base that must be pulled in to support a pyramid scheme becomes a liability. What happens when they are finished running their game and what is the 'end' of their game. Surely it has a planned end. To think it doesn't would be simple minded. It either comes down to war or some type of armeggedon for most of us. Deppressing to contemplate. It is a horrible system and a fools game.

[Gknowmx]

The author stumbled on a truth though I am not convinced he understands it. I agree that to a certain extent, the fraudulent relationship is rooted in our DNA: certain personality types are wired to be sheep by default while others are wolves. It is a system of co-dependents largely. Those that escape the co-dependence likewise are either born to escape it, or they choose to engage their mind as a tool to overcome our default nature.

I think that many of us who have wrapped our minds around this issue see that the sheep-wolf co-dependent phenotypes are so pervasive that indeed systemic failure will be the only recourse to either successfully induce additional folks to engage their mind... or die.

As much as I see the injustice of the current system, I don't wish for systemic failure any time soon, it will be ugly for everyone.

[BillBoard]

Thanks for posting the article.

Nothing that we didn't know already, but it seems to me that virtue, morals, and ethics were long sacrificed for profits.

The mouth piece labeled as an adult in the article will soon find out the real consequences of sacrificing principles for profit. The death and devastation that will ensue will make the World Wars seem like walks in the park.

[brigadeer]

Personally I say bring it on. What's that guy going to do??? Hope he's got a gun but I guess in Downtown NY it ain't going to happen.


I think this is most likely the prevailing opinion on forums such as this, and I completely understand why. I often feel that way myself. We are the productive members of society, not the bankers and social elite. The idea of starting over fresh does sound good. We all know they need us (leaches), we don't need them (host).

That said, I just cannot picture myself actively rooting for the demise of our banking system, and by extension our country. My father for example, is just now retiring. As much as jailing everyone on Wall Street might be justified, I do agree with the article that it would cause a total collapse in confidence within all markets, and within a short amount of time, my father along with tens of millions of other would be pennyless. I just don't think people are truly wrapping their brains around how horrible that would be for everyone, even the preppers and stackers among us.

Another reason I'm not actively rooting for their (bankers) demise is that the current ponzi scheme financial system would only be replaced by a new one, except it would be newer and improved with greater control over the people, and I think all of us know this deep down. I think the following quote is very fitting here......."It's better to deal with the Devil you know than the Devil you don't".

As most of you aptly point out, I think it's a foregone conclusion that this system will collapse eventually. Mathematics don't lie. I just can't bring myself to wish immediate misery upon millions of people.

[sirgonzo420]

What is the true value of a home? ....Take away the 30 yr mortgage and what is the true value of that home?




Bravo.

This question is incredibly important to wrap one's head around, and reflecting upon it leads one to just about every other incredibly important point to understanding the economy. As you pointed out, Geithner let slip the reality of the situation. Down the rabbit hole we go.......




Aw hell, what does Geithner know about economics?

As he's said multiple times, he's "not an economist"....


lol (he has a hard time with his taxes too)

[Hatha Sunahara]

The Roman empire kept itself propped up with as much fraud for hundreds of years. The reason it didn't collapse sooner was because there was nothing to fill the vacuum. People just let it do whatever it wanted because Roman order was 'the devil they knew'.

We have the NWO to fill the vacuum. There is no doubt in my mind that it will be a controlled collapse. What's on the other side is a global totalitarian dictatorship. Those who say 'Bring it on" will be the ones who will most long for 'the good old days'. The NWO is the devil we don't know. Or do we?

Hatha

[sirgonzo420]

The Roman empire kept itself propped up with as much fraud for hundreds of years. The reason it didn't collapse sooner was because there was nothing to fill the vacuum. People just let it do whatever it wanted because Roman order was 'the devil they knew'.

We have the NWO to fill the vacuum. There is no doubt in my mind that it will be a controlled collapse. What's on the other side is a global totalitarian dictatorship. Those who say 'Bring it on" will be the ones who will most long for 'the good old days'. The NWO is the devil we don't know. Or do we?

Hatha


Yep.

[Book]

The author stumbled on a truth though I am not convinced he understands it. I agree that to a certain extent, the fraudulent relationship is rooted in our DNA: certain personality types are wired to be sheep by default while others are wolves. It is a system of co-dependents largely. Those that escape the co-dependence likewise are either born to escape it, or they choose to engage their mind as a tool to overcome our default nature.


http://spktruth2power.files.wordpress.com/2009/04/federal-reserve-history.jpg

Talmudic bullsh*t. The relationship is rooted in parasite-host exploitation. Here in this article the parasite Media is trying to con the host into thinking there is some kind of mutual benefit. Conning the gullible dumbed-down sheeple goyim.

Sure, it is going to be painful to kill this parasite but we owe it to our grandchildren. That simple. Bring it on.

:oo-->

[Gknowmx]

The author stumbled on a truth though I am not convinced he understands it. I agree that to a certain extent, the fraudulent relationship is rooted in our DNA: certain personality types are wired to be sheep by default while others are wolves. It is a system of co-dependents largely. Those that escape the co-dependence likewise are either born to escape it, or they choose to engage their mind as a tool to overcome our default nature.


http://spktruth2power.files.wordpress.com/2009/04/federal-reserve-history.jpg

Talmudic bullsh*t. The relationship is rooted in parasite-host exploitation. Here in this article the parasite Media is trying to con the host into thinking there is some kind of mutual benefit. Conning the gullible dumbed-down sheeple goyim.

Sure, it is going to be painful to kill this parasite but we owe it to our grandchildren. That simple. Bring it on.

:oo-->


So, lets say we get rid of the parasites, and I am all for that, what comes next? What does the new world look like? What system will we see?

[Book]

So, lets say we get rid of the parasites, and I am all for that, what comes next? What does the new world look like? What system will we see?


http://img.photobucket.com/albums/v26/Chanib/MiscPix/sheep.jpg

First things first: Get rid of the parasites.

:oo-->

[Sparky]

...

That said, I just cannot picture myself actively rooting for the demise of our banking system, and by extension our country. My father for example, is just now retiring. As much as jailing everyone on Wall Street might be justified, I do agree with the article that it would cause a total collapse in confidence within all markets, and within a short amount of time, my father along with tens of millions of other would be pennyless. I just don't think people are truly wrapping their brains around how horrible that would be for everyone, even the preppers and stackers among us.
...

I dunno. What does it really mean when everyone is pennyless? Does production and distribution stop? Does the amount of net tangible resources available to the system become reduced? Who gets it? Where does it go? Does it evaporate?

All real assets (and I don't mean money) are owned by somebody. The result of half the country being pennyless would be dependent upon what the "haves" chose to do.

This is a very thought-provoking thread. What would really happen if tomorrow, everyone's bank account was zero. Isn't that why many of you here have transitioned your "assets" out of bank accounts? If, as a result, you became disproportionately "rich", wouldn't you come to the aid of your family and friends? Wouldn't you hire them to be productive for you, keeping the system going without the lies?

This is an interesting thought exercise.

[Gknowmx]

...

That said, I just cannot picture myself actively rooting for the demise of our banking system, and by extension our country. My father for example, is just now retiring. As much as jailing everyone on Wall Street might be justified, I do agree with the article that it would cause a total collapse in confidence within all markets, and within a short amount of time, my father along with tens of millions of other would be pennyless. I just don't think people are truly wrapping their brains around how horrible that would be for everyone, even the preppers and stackers among us.
...

I dunno. What does it really mean when everyone is pennyless? Does production and distribution stop? Does the amount of net tangible resources available to the system become reduced? Who gets it? Where does it go? Does it evaporate?

All real assets (and I don't mean money) are owned by somebody. The result of half the country being pennyless would be dependent upon what the "haves" chose to do.

This is a very thought-provoking thread. What would really happen if tomorrow, everyone's bank account was zero. Isn't that why many of you here have transitioned your "assets" out of bank accounts? If, as a result, you became disproportionately "rich", wouldn't you come to the aid of your family and friends? Wouldn't you hire them to be productive for you, keeping the system going without the lies?

This is an interesting thought exercise.


Sparky,

I have considered this and I have tried to "help" family and friends but with very very limited success. I have even tried offering a loan with non-usurious terms. I am attempting to acquire my grandmother's house from my uncles this way also and allow my relatives to use it on terms. So far, in all cases, personalities, and stupidity prevail to prevent these pre-collapse experiments from succeeding. It will be hard to overcome most people's entitlement mentality that includes the entitlement to lie, cheat, and steal at will... until there are consequences. So, it is not about a willingness to "help" family and friends, the question is: what is one willing to do to enforce terms? Use forces and fear? Use a quid pro quo strategy? Or start with principles and make it clear that you will use these strategies in reverse order to enforce?

[Book]

I dunno. What does it really mean when everyone is pennyless? Does production and distribution stop? Does the amount of net tangible resources available to the system become reduced? Who gets it? Where does it go? Does it evaporate?


http://www.scene-stealers.com/wp-content/uploads/2008/08/le_docteur_jivago_doctor_zhivago_1965_reference.jp g

See the comrade with the rifle evicting Doctor Zhivago from his mansion? When the thieves on Wall Street bankrupt society they will hop on their private jet and flee to Tel Aviv. Whoever remains behind experiences retribution and collective property re-distribution.

:oo-->

[FreeEnergy]

The problem is everyone is so concerned with "their retirement fund".

1) assume "retirement fund" does NOT EXIST. It has been stolen. Assume that.
2) assume that fiat money is not a storage of wealth. it cannot possibly be.

What the guy's saying is a LIAR'S BULLsh*t. You don't have to get rid of the money to make the system work. You have to get rid of PARASITES which are private bankers, and hence are STEALING FROM THE SYSTEM, not helping it go.

Lehman collapsed oh my...poor everyone....who CARES. It was a Ponzi scheme DESIGNED TO COLLAPSE. Ok, let me repeat this - IT WAS DESIGNED AND DESTINED TO COLLAPSE.


Steps:
1) let government take over the FED. Forbid money creation with debt attached
2) hire a bunch of bankers to make this work right, the rest will go in jail
3) limit credit card usury to certain percentage for now, say 15%.
4) keep private mortgages going, disallow front-loading mortgages, but allow higher interest rate. that will destroy the market of flippers and the market of bankers who prey on mortgagees. the interest will go up significantly though.
5) let home prices collapse, adjust existing mortgages to the new level, so people could stay in the houses.

There may be more steps. Someone needs to look at the economics of it all. And yes, it would be painful.

[FreeEnergy]

It would be fairly easy, having access to actual economical numbers, to come up with a better schema that will not be as fraudulent as it is. I CAN GUARANTEE IT.

Here's an idea:
Allow people to withdraw pensions without penalty IF the money is invested in real estate. Tell them IN PUBLIC, ON TV that it is either that, or the government take-over of their funds. Watch how fast people will start pulling money out to pay mortgages off, and how fast PARASITIC mutual fund industry collapses.