Eric Janszen: We Are Witnessing The Death of the Dollar

What do you get when the producer of the world's reserve currency takes on too much debt? Nothing less than the end of the US Treasury-based monetary system.

So says Eric Jansen, economic and financial market analyst and proprietor of iTulip.com. In chronicalling the decline of the global economy over the past decade, Eric has formulated a framework called the "Ka-POOM" theory which endeavors to understand how the immense run-up in global debt will be resolved.

In short, it looks at the at the credit bubble that began in the early 1980's, started accelerating in 1995, and has now reached epic proportions. The amounts are so staggering at this stage that Eric believes it is too politically undesirable to let natural market adjustments clear them away - the magnitude of the deflationary pain this would create is simply unacceptable for politicians looking to get re-elected. The only other available option left is to service these debts via a dramatically devalued currency. Hence the key role the Fed is playing today.

Category:

People & Blogs

Tags:

• dollar
• policy
• global
• fed
• greenspan
• bernanke

[outoftheboxinsight]

We are witnessing the birth of a higher state of consciousness

[texture6]

The Fed is trying to, safe crash this plane but the runway = jobs is to short prepare to crash...population overload :)

[gwynedd1]

@0muffins0

Actually that is not true of many seeds including grains that are adapted to survive long dry spells like annual grasses. Lotus seeds last of thousands of years and also happen to be quite the edible biomass no one seems to know about. Parsnips on the other hand go bad quickly which is not a problem because there is no need to save them. You can get them on the side of the road.

[definitionofis]

His differentiation of central bank and member banks at18:17 is inadequate, because in fact any bank can do the "magical things". The rules preventing infinite magic in member banks are artificial. Fannie and Freddie similarly expanded their balance sheets infinitely, like a central bank.

[T0B0KKE]

@rayme4raw I still don't get why then America needs to go to Lybia and Iraq to get oil and gas when they have it all along inside their own territory? They want to deplete foreign reserves first, profiting from war along the way, and then when everyone thinks oil has reached its peak, they say: "Gotcha!! We have loads of oil now. Guess who rules the world!?!?"

[T0B0KKE]

@rayme4raw What I know about Portugal (i live there btw) is that we're needing extra 25 billion € before the end of 2011, or we go bankrupt... I was already expecting this... It is obvious that without growing we couldn't pay the 5,5% interest rates the troika asked us to. No austerity will put us back on growing, it will just bury us in the deeper and deeper debt hole.

[rayme4raw]

@T0B0KKE The markets are slowly catching on. It's going to take a couple of weeks before we start to see the fallout from the Greece Default. Portugal is coming up next with it's problems and Spain & Italy are seeing their interest rates rising, even at 7% interest rate they face problems where their debt becomes unmanageable. The EU says that they can come up with a trillion euro using leverage, it's also going to take a couple of weeks before investors find they cannot do it. Interesting times

[T0B0KKE]

@rayme4raw I don't quite understand how come the markets didn't realize that Greece defaulted. When the Germans said that they would be forgiving 50% of Greek debt and lending money at negative interest... Those are considered defaults. I don't buy anything these dimwits at the European Council say, but the markets seem to be blinded by the measures that come out of those meetings. Why do they still keep in shrouded in this illusion?

[rayme4raw]

@T0B0KKE It's already changing. The Revolution will not be Televised. I cannot even keep up with all the good and bad news these days. I'm changing, my family who is not even awake is changing. The people are becoming more & more decentralized. They no longer believe in the almighty govt. Greece has already defaulted, we're just waiting for the markets to realize it. World changing events will keep picking up speed. If you believe in freedom then you don't need to wait.

[T0B0KKE]

@rayme4raw What are we waiting for to change the world then?

[rayme4raw]

@0muffins0 My dad was high up in the Navy with top level security clearance. He's been saying for decades about the oil fields that have been drilled and then left idle. We never listened to him because we weren't awake then. When I heard Paster Lindsey Williams speak about the idle oil fields, it confirmed every thing my dad has been saying all my life. My dad also says that the Navy has been using Cold Fusion for quite some time now, he was the electrical engineer on some related projects.