Cheap Government Borrowing Is Rapidly Ending

The IMF wants an international tax which would be run by unelected elites who happen to be the same people who want CO2 pollution taxes.  Time to discuss the problems of states running on debts rather than taxes and how suppressing working class wages leads to governments defaulting on debts, even ZIRP debts.  Avoiding this fate means strengthening the wages of workers which means helping them fight for a bigger bite of the profit pie.  All of this irritates the ruling elites who want the entire pie for themselves.  Oink.

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IMF urges double tax hit on banks to refund taxpayers – Telegraph

In a report delivered to G20 nations on Tuesday, but yet to be published, the Fund has urged countries around the world to impose two new taxes on financial institutions: a “financial stability contribution” which levies a small charge on their balance sheets, and a “financial activities tax”, which taxes excess profits, including bonuses…. .

…The IMF report recommended that the proceeds of the taxes should go towards both a fund to be used to repair the economic damage wrought by this and future financial crises, and towards general government revenues.

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ΩΩThe IMF wants international taxes?  HAHAHA.  This is very similar to the CO2 pollution tax. Iceland volcano causes fall in carbon emissions as eruption grounds aircraft | Environment | guardian.co.uk: as I keep on harping, if the CO2 hysteria is correct, the fact that CO2 went down not due to an international tax on pollution but thanks to Mother Nature forcibly preventing people from gadding about the planet via jets!  If the Prince of Wails about how we are all going to die of the heat is correct, this fact clearly shows that I am correct when I say, outlaw all jets.  Don’t tax them, outlaw them!

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ΩΩThe main reason for international taxes is to harness the entire planet’s populations to IMF and World Bank and naturally, by extension, the Bilderberg gang’s agendas and desires.  As for sovereign powers taxing bankers: DUH.  It is easy.  The US has this immense and very, very expensive navy that spends nearly all of its energy and time, hanging out next to Iran and China.  Instead, we use it to invade all the tiny principalities that swear allegiance to various royals and then impose national taxes on them.  Closing these pirate coves is laughably easy but of course, our British buddies have to also dispose of their antique queen and her brood of leeches.  No loss to humanity.

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ΩΩEventually, using our air force and navy, we can corner all of these pirates.  I am 100% for taxing them very heavily since we have a budget deficit.  Ever since the bankers took over after Reagan and the GOP made piracy easy, the share of wealth of these gnomes rose from just 4% of the GDP to over 20% and climbing.  At the same time, we see nothing but budget deficits.  So we fix both matters with one cruel stroke.  Of course, these gangsters will yell that they will flee America and go somewhere else.  But this is why we have a navy and air force: to chase them down!

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ΩΩRaw power has its uses.  Using our navy and air force to protect these looters is stupid. Using it to corner them and to force them to pay their considerable debts to society is honorable and necessary.  We took on trillions in obligations and losses in order to bail these creeps out. Make them pay for ALL of this!

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Sovereign debt tops IMF worries – Telegraph

“The crisis has led to a deteriorating trajectory for debt burdens and sharply higher sovereign risk. Vulnerabilities now increasingly emanate from concerns over the sustainability of governments’ balance sheets,” said the Fund’s Global Financial Stability Report. Sovereign debt strains may infect the banks and “prolong the collapse of credit,” with the risk of a vicious circle as this feeds back into the economy.

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ΩΩCoddling tax cheats who hog an increasingly bigger and bigger slice of the economic pie is suicidal.  Governments must tax someone, some time.  At NO time in ANY history has ANY civilization had no taxes.  This is IMPOSSIBLE.  What they must do is balance spending with potential tax revenues and then insure taxes fall mainly on the rich, not the poor.  All nations that end up taxing the poor end up imploding and dying.  The richer a segment of the population is, the more they must be taxed.

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ΩΩIf this segment screams they will leave the country, the government must confiscate the wealth in one way or another, this happens all the time, it doesn’t matter what sort of system runs a country, this is a historical imperative.  If rich people support regimes that overspend money on wild wars and 700+ military bases across the entire planet, then they must be very heavily taxed to pay for this.  Instead, as the US expanded its military obligations, it reduced taxes on the rich, compressing the tax spread to nearly zero between income groups, that is, the very rich pay a very low percentage of tax on their wealth while getting richer thanks to government overspending.  This is because rich people can buy or use government debt bonds and then collect the interest, for example. Or make money in the military sector.

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Greek lesson: we are all in the same boat – Telegraph Blogs

ΩΩThe British are directly responsible for  much of the present odious banking system.  Most of the tax havens which host banking piracy are connected to the Crown of England.  Note the graph above: the article is all about Greece being weak but the issuers of the longest range debts which are the highest happens to be far and away, England.  England’s fraudulent banking structure is the heart of this matter: the system set up by England to deal with the near-total loss of its industrial, intellectual and military base is a wretched Ponzi scheme.

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ΩΩAn increasing proportion of the population is now mired in total idleness since the sorts of simple jobs traditionally filled by the less-educated masses have vanished and the existing jobs are now being filled by Eastern European interlopers, this means that a significant part of the tax base has vanished and been replaced with a tax liability.  On the other hand, during this present election going on in Britain today, one where the third party candidate, the not-Labour and not-Tory guy, Clegg, is running ahead in the polls, we see talk about cutting social services to the idle poor being discussed.

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ΩΩThe problem here is simple: you can’t cut support unless there is some alternative option.  In the US, the cuts in welfare led pretty much to a hike in social crimes like drug dealing, prostitution, gambling, etc.  The cost of keeping the male part of the idle poor population under control shot through the roof as prisons expanded tremendously.  Now, with rising debts and collapsing tax revenues, states like California are now being forced to close these immense prisons and eject these unfortunate people back into the streets where they must live by their wits, there being fewer and fewer low level jobs to occupy their energy and time.

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ΩΩThe United States has occasional third parties. For example, Ross Perot’s third party attempt was all about international trade agreements that would create a ‘giant sucking sound’ as jobs flow out of the US.  Ross was 100% correct about this and he garnered a good segment of the vote including my own vote.  His anti-imperialist line was correct.  In the past, we had Teddy Roosevelt’s Bull Moose party which was all about what sort of currency or banking system we should have.  Teddy was also an imperialist.

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ΩΩSocialist parties are locked out of the US conversation so we never had a ‘Labour Party’ here.  What we see in the media spotlight are pointless exercises in organizing such as the tepid Tea Party gambit.  The Ron Paul people who launched this were drowned out by an army of GOP operatives flooding into the fledgling group which supports international militarism, increased military spending, more debts for things the pettit bourgeoisie want and a continuance of free trade.  There is no philosophical or political underpinning of this group that unites it except for one: it wants the GOP status quo to continue.  This, incidentally, includes doubling the national debt every 8 years.

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ΩΩProof of this is simple: virtually none of these Tea Party fans made so much as a peep during the Bush regime’s years in power.  This is why the media coddled these people.  They are not revolutionary or will change anything anymore than Obama has changed much of anything (the health care bill is about the weakest national health system set up on this planet!).

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Risk of Japan going bankrupt is real, say analysts – Yahoo! Canada Finance

Greece’s debt problems may currently be in the spotlight but Japan is walking its own financial tightrope, analysts say, with a public debt mountain bigger than that of any other industrialised nation.

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Public debt is expected to hit 200 percent of GDP in the next year as the government tries to spend its way out of the economic doldrums despite plummeting tax revenues and soaring welfare costs for its ageing population.

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Based on fiscal 2010’s nominal GDP of 475 trillion yen, Japan’s debt is estimated to reach around 950 trillion yen — or roughly 7.5 million yen per person.

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Japan “can’t finance” its record trillion-dollar budget passed in March for the coming year as it tries to stimulate its fragile economy, said Hideo Kumano, chief economist at Dai-ichi Life Research Institute. “Japan’s revenue is roughly 37 trillion yen and debt is 44 trillion yen in fiscal 2010, ” he said. “Its debt to budget ratio is more than 50 percent.” Without issuing more government bonds, Japan “would go bankrupt by 2011”, he added.

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ΩΩAnd why does Japan run on debt fumes, too?   The answer to any government debt is to tax the people.  Why can’t they be taxed?  Well, as expenditures rose, the incomes of ordinary Japanese fell.  The ZIRP debt system depends on dropping prices and the only way prices can drop in Japan which imports a great deal of their raw materials, is to drop wages.  Dropping wages=dropping tax revenues.

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ΩΩJapan is now thrashing about how to fix this.  The only thing they can grasp here is the nettlesome tool of sales taxes.  These are the most socially unfair taxes of all.  Income taxes that are graduated with the rich paying the highest percentage is the most fair form of taxation for a socially secure democracy.  As Japan fixes inflation by reducing wages, it unbalances the tax system and this leads to more debts.  In the case of Japan, the ZIRP system which is so cruelly crushing the greater masses of Japanese workers, encourages more government debt instead of higher wages, higher interest rates (which then restricts government spending) and higher tax collections thanks to rising wages.

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ΩΩBelgian deputy PM calls on Japan to ease non-tariff barriers › Japan Today: : Japan’s entire system depends on unfair trade.  The US is alarmed at the high Chinese trade surplus but should not ignore the high Japanese trade surplus.  The scales of trade balance must be reset.  Japan has little intention of allowing imports and will pick and choose various schemes and tools to prevent fair trade.  This should be recognized and Japan should pay the price for these policies.  But the need to have the ‘air craft carrier of Asia’ as a top US military base to menace China has stopped any actions from being pushed to get Japan to open up to world trade.

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ΩΩMeanwhile, the Japanese furiously debate the issue of these American bases which they greatly dislike.  There are daily demonstrations in Okinawa agitating to close US bases there, for example.  The present government of Japan rode to victory, promising to reduce and close US military bases.

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Interest rates to rise in US | The Money Times

According to economists, interest rates will rise to surmount the ever increasing debt and prevent inflationary trends in the nation. “Americans have assumed the roller coaster goes one way,” said Bill Gross of investment firm Pimco. “It’s been a great thrill as rates descended, but now we face an extended climb.”

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ΩΩTea Party agitation to stop US overspending will be totally unnecessary.  The true whip that will force us to stop borrowing to infinity is rising interest rates.  There was no shortage of ‘credit’ in the last 2 years.  There was a gross excess of credit the preceding 4 years and now we have a credit drought after an obvious flood.  We can’t have continuous floods of credit.  Japan’s ZIRP system at the top (the bottom half of the economy has virtually no credit or very expensive credit) has nearly destroyed the entire economic structure which is why ZIRP systems, far from being heaven, are actually pure hell.

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ΩΩThe people who qualified for this ZIRP borrowing have been fewer and fewer in number until virtually the only entities that qualify for ZIRP loans are the government and international corporations like Toyota and international bankers operating out of Crown dependencies run by Queen Elizabeth II.  This narrowing of the pyramid of borrowers is leading to excessive debts piling up in just one sector, another item I call, ‘dangerous imbalances’.  So we have to see an end to Japanese ZIRP economic policies and a reintroduction of normal banking and taxing systems.

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ΩΩInstead, the US and UK tried very hard to replicate Japan’s system including the odious business of ruthlessly reducing working wages and eliminating jobs of the underclass while not taxing the rich harder and harder to fund the government.  The ONLY thing flowing into these social systems is more debts!  These debts drain the system of all capital and leads to the temptation of defaulting on all these ZIRP loans.  That is, the refusal to pay any principal on these loans is the only option since this debt can’t be reduced by turning it over for cheaper rates, there are no cheaper rates.

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ΩΩWorse, even the smallest rise in interest rates hammers ZIRP borrowers.  Who generally, go to the hilt in debt while paying nearly no penalties. A 1% rise on a million dollars is no big deal.  A 1% rise in borrowing costs when turning over say, $10 trillion is huge.

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Beware The Carry Trade Collapse – Forbes.com

In short, at the first sign interest rates may rise, the carry-trade bubble will burst and everyone will rush to sell. Unfortunately the only big buyer for these treasuries will be the Fed–and given the state of its balance sheet, the only way it will be able to pay for them is by printing more money. That is when inflation will begin.

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This carry trade bubble is around the $500 billion dollar level and growing. The bigger it gets, the more danger, since there is no foreseeable way for it to deflate short of bursting. A spike in long-term rates can be triggered by financial news, fear of new government regulations, an international event or even a rumor.

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ΩΩNo, there is no carry trade bubble that will burst, there is a credit default swap swamp monster that will come lurching out of the grossly immense derivatives markets!  Betting that interest rates would drop and drop and drop over the course of the last three decades was very easy.  The ups and downs were all within a defined range that trended downwards over time.  But we hit rock bottom last year and the only direction things can move is upwards.  Upwards=increasing restrictions and reductions in volume.  Just as downwards=easy credit and increase in debts.

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ΩΩNow, on to the slithering snakes at the bottom of this pit of debts: Rubin: I Actually Supported Regulating Derivatives

Clinton-era Treasury Secretary Robert Rubin, who will go down in history as one of the men who killed derivatives regulation, insisted today that he has long thought that derivatives should, in fact, be regulated.

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“I thought we should regulate derivatives; I thought so when I was at Goldman Sachs and I thought so afterwards,” he told HuffPost during a break at an event for the Hamilton Project, a think tank he founded to support Wall-Street-friendly Democrats. Rubin was chairman at Goldman Sachs before joining the Clinton administration in 1993; after he left, he went on to head Citigroup, which he nearly bankrupted with his excessive risk-taking.

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ΩΩHAHAHA.  Typical of children who do something very naughty.  ‘I didn’t really want to throw that rock at the windows, it just sort of slipped out of my hand as I was turning around, ‘ whines little Bobby.  Boo hoo hoo.  This guy is a born liar which is why he was so successful.  It still causes me no end of fury that he was selected to give Obama counsel when his stupid system he set into motion, crashed into the brick wall of reality.  I remember when Barry Goldwater ran against Rockefeller, he talked about international banking and he led a revolt within the GOP against the Rockefeller/big bank faction.

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ΩΩWhich went down in flames in the following election, of course.  I knew Barry Goldwater because we once lived next door to him and he was a very good friend of my dad.  Barry was a warmonger, of course, and saw no problem with overspending on the military, which happened to be LBJ’s position, too.  And Rockefeller made out like a bandit on all this government overspending, too.  So he was happy.  Bush Sr learned a lesson in all of this, he of course, was the son of Northeastern banking elites and had to make a mock up front of being a good old guy who wasn’t a silver spoon banking brat.

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ΩΩBut he and his son were Überbankingbrats.  So instead of curbing the powers of the bankers, both men enabled it totally.  This is where the ‘where is there any choice’ raises its ugly head here: we have so few political choices and the news media insures that we have limited choices.  A recent poll showed that over 50% of the people polled about third party candidates didn’t even know who Ron Paul was!  And Kucinich has even slighter recognition factors.  While Palin has total recognition just like Obama or the Bushes, etc.  So long as one supports the banking cartel, one is guaranteed face time on TV.

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Goldman Sachs taps ex-White House counsel – Eamon Javers and Mike Allen – POLITICO.com

Goldman Sachs is launching an aggressive response to its political and legal challenges with an unlikely ally at its side — President Barack Obama’s former White House counsel, Gregory Craig.

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ΩΩAnd here it is: all the people working in and out of our government, as the door between the elites and the government spin, everyone is on the same level and doing the same thing: whoever is in power, the people working for them will always end up working for the rich bankers who use them to get away with various crimes.  Shame on Mr. Craig.  He should defend Mafia bosses or drug cartel heads in Mexico.

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Goldman Director Gupta Dines With Obama, Deals With Rajaratnam – Bloomberg.com

Goldman Sachs Group Inc.’s November 2006 announcement of Rajat Kumar Gupta’s election to its board brimmed with the India native’s achievements: worldwide managing director of McKinsey & Co.; special adviser to the Secretary- General of the United Nations on management reform, co-chairman of the American India Foundation charity, whose honorary chair is former President Bill Clinton.

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Goldman Sachs Chairman Lloyd Blankfein said at the time: “Our shareholders will be fortunate to have his strategic and operational expertise and judgment.” Now, with his term ending next month, Gupta is leaving the board.

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On March 19, without explanation, the firm announced his decision, thanking him for his service. Three days later, prosecutors said they were examining trades in Goldman Sachs shares by Raj Rajaratnam, the central figure in the largest U.S. insider-trading case ever and a onetime Gupta business partner.

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ΩΩThere are anti-semites who blame Jews for everything.  This is insane and stupid.  Anyone can become a corrupt elite banker!  Indeed, half of the planet’s finaglers are not Jewish in the slightest.  More than half.  A lot more than half.  Understanding the systems requires understanding this basic fact: elites can and do spring up from anywhere and everywhere all the time, it is a shifting kaleidoscope of alliances, family groupings and relationships tied into the rise and fall of various nations and economic powers.  The increasingly massive Chinese banking system is very much Chinese in ethnicity and it is no surprise about their successes: they are ruthlessly literal and completely agnostic.

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ΩΩAnd are also committed to a socialist paradise.  As are the Jewish bankers, so long as this paradise is a Jews-only one in Israel.  There is nothing wrong with wishing for this and working for this!  What is wrong in the case of the US, is sucking up immense amounts of US credit and dumping debts on the US public so Israel can have a great economy and full social services for Jews living there.

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ΩΩBy the way, the McKinsey and Co guys are the top advisors to Obama and pretty much hand-picked him. They are, of course, totally Council of Foreign Relations imperialists.  Bite the ties between Mr.  Gupta and Bill Clinton, for example.  As the dark cloud over Gupta gets blacker, he visits his latest puppet, Obama.  Obama has to wine and dine this guy in order to stay in power.  The political parties have to raise immense funds to get TV face time and to do this, they spend extraordinary sums on courting the spoiled brats at the apex of the economic pyramid, the guys who refuse to pay honest taxes to fund our overspending imperialist government:

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Getaways, gifts suck up most of parties’ funds – Washington Post- msnbc.com

Both the national Democratic and Republican party committees spend about two-thirds of the money they take in on the care and comfort of committee staffs and on efforts to raise more funds, with lavish spending on limousines, expensive hotels, meals and tips, an analysis of the latest financial disclosure data shows.

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Monthly committee spending reports, like those that were due by midnight Tuesday, illustrate cultures in which vast sums are consumed with limited accountability, a Washington Postreview has found. Neither committee appears to have clear internal spending guidelines, and their reports do not explain hefty expenditures in categories such as “office supplies” and “tips” that consume tax-exempt party funds.

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The two parties assert that to raise money, they must spend it, and both have long used donated funds to court and pamper prospective donors with luxurious getaways and gifts.

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ΩΩThe vast bulk of money raised by Palin also went to political operatives and hand washing operations.   These rich people giving money to politicians are expecting to get paid back in triplicate and proof of this is painfully obvious: they got all these tax cuts and changes in the rules of banking so they could pig up inside the unregulated derivatives markets!  Even so, they want to be coddled and petted and do so in very expensive bordellos and junket joints in Las Vegas.  These are the heavy rollers who hang out on the top floors of casino hotels!

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ΩΩInstead of campaign finance reform, we get all sorts of junk like a healthcare reform that was utterly destroyed by campaign slush fund lobbyists reminding everyone, who is the real boss here.  And finance reforms won’t happen for the same reason.  This is why Obama’s first three things he should have done was to terminate all our ridiculous wars with Muslims, defund Israel and campaign finance reforms that cut off this flood of corrupt money.  This meant, of course, taking on AIPAC.

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ΩΩThe media owners adore AIPAC, they ARE AIPAC.  So he couldn’t fight that monstrosity.  Nor could he fight off the international bankers, foreign corporations and others from flooding Congress and the Presidency with bribes.  All the main political parties including the odious and silly Tea Party refuse to talk about this.  I detected no Tea Party signs about political donations corrupting our system!  It was all about tax cuts as if anyone here is being taxed at all, considering how our debts double every generation.   We see no signs about stopping war spending, either.

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ΩΩAnd the left has been very quiet lately due to Obama being elected.  Even as people on the streets get disgusted with Obama’s actions, coddling the rich and enabling imperialism, this isn’t energetic enough to take to the streets and protest loudly.  Not that the media would cover this, anyway.  Just like in 1968, a quiet America just might wake up when Europe or Asia erupts into energetic reaction.  I was in Europe in 1968 and saw, first hand, how things started out very gradually and then suddenly, in May, exploded into high gear.  Then I came home to the US (actually, I was deported, hahaha) and saw the same happen here (with a little help from myself).

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ΩΩChina and Germany saw similar eruptions in actions in the same two years in the late 1980’s with a quiet population suddenly taking over and making news, big time.  The change from silence to a roar is like a volcano: very sudden, even if there are some rumbling warnings deep below beforehand.  The Tea Party is a washout.  But watch out: there may be something else lurking behind this that can erupt and it won’t be middle class people enjoying the perks of our present social system demanding an impossible status quo (low taxes and lots of spending on the military).

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ΩΩRemember: the unemployed pay virtually no taxes.  And have no income once their unemployment runs out.  This is the real ticking time bomb.  Promising them tax cuts won’t work.

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