Friday, December 22, 2006

The United States is insolvent

America is headed down the crapper. That's what Dr. Chris Martenson of Financial Sense University said. And it is not good.

I take issue on what Martenson said. Although my outlook isn't any better, I have a different philosophy.

The United States has what Martenson missed: the Federal Reserve. Although Martenson did mention this in the latter letter, he didn't mention its name. The Federal Reserve is a semi-private, semi-government system who makes the country's money. The private side, the Federal Reserve is a cartel of private, for-profit banks who works for the owners, not the people. The government side, the government makes Federal Reserve notes (FRN) "legal tender" and crimes will occur when using the notes illegally (e.g., counterfeiting). The banks and the government officials have a system.

When the bureaucrats spend more than the government takes in through taxes, the Federal Reserve borrows the rest, and the government has to pay the Federal Reserve back, with interest. When government can't pay, that is a debt--the national debt. All the income tax will do is to pay interest on the national debt, as the Grace Commission reported.

When the Federal Reserve floods the market with money, inflation occurs, and the value of the dollar is lowered. When foreign markets find out the U.S. dollars is worth less and less, they will finally dump the the FRN and go to a different money (e.g., euros). When that happens, the dollar will collapse, like the Soviet Union in the late '80s/early '90s.

However, there is a chance that the amero, a North American currency, will replace the dollar. Like the dollar, the amero is nothing more than a worthless fiat-paper money, and this will ultimately end up like the dollar. The only difference is the U.S. dollar is strictly for America, while the amero covers North (and maybe South) America. This is one step closer to a New World Order. Like I said, the future is not looking too good, if we don't do a 180-degree turn, and fast--or get out completely.

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