Punchinello’s Chronicles

April 28, 2011

What Do We Do Right Now?

Month after month we hear the bad news. It really doesn’t matter anymore what particular story comes to light. We’ve passed the tipping point. It’s a bit pointless to discover more corruption, more regulations, more hypocrisy, more fraud and more of everything. The stage was set decades ago, and we’re in the end game now. Free-market capitalism, centered in the United States of America is under final assault. The bad guys are winning, but the US citizens are waking up. So what’s the next step? What do we actually do?

Let the investment banks and financial wizards all fail! Get Toto to pull back that curtain!

The first thing is education. Instead of watching “American Idol” and reading the so-called mainstream news reports, spend some time asking questions. Grow up, learn how to balance a budget, get rid of unsecured credit cards and loans, and move toward a cash-only basis. That’ll help you survive the collapse of paper money.

The next thing is to learn how to actually take care of yourself in an inconvenient world. Do you know how to shop for your basic, everyday necessities? Do you know how to cook some simple meals? Can you entertain yourself without the help of 10,000 TV channels?

But of all the things that we can do, the single most effective is quite simple: Let Them Fail!

There’s a good reason we have competition in the world. Survival of the fittest wasn’t invented by Charles Darwin, and it didn’t apply to the biological world. It’s an economic principle, and Darwin adapted it to biology. But that’s okay, let’s stick with biology and consider bacteria.

Bacteria have a simple and basic attribute that helps to understand evolution and natural selection: they breed exponentially, really fast! Start with a single cell, and within days you get millions of cells.

With millions upon millions of a particular bacteria, we invent some sort of antibacterial agent; penicillin, for example. It NEARLY wipes out that massive colony of bacteria. Even so, with hundreds of millions (if not billions) of cells, there’s a very high chance that at least 1 cell will survive. It’ll have some strange mutation or DNA variant that’ll allow it to survive the onslaught of penicillin.

With that one, single cell that’s immune to penicillin, the rapid breeding cycle of bacteria allows it to create hundreds of millions of replicas, ALL of which are now immune to penicillin. It’s basic natural selection, survival of the fittest, and leads to what we now call Super Bacteria.

We absolutely must have life based on survival capabilities, and death based on obsolete or insufficient survival attributes. Without death, there wouldn’t be enough parking places, for cryin’ out loud!

In today’s world, the single cause of just about everything we’re witnessing in the collapse of the American empire begins with government (state) support of dead, dying, or failed entities!

Fortunately, with the Internet and World Wide Web, people everywhere in the world have become more powerful as individuals. Knowledge is power, after all, and with that knowledge comes completely new and different survival skills. One of those new skills has to do with forcing the world banking system to adopt a metals-based money system. It doesn’t matter if it’s gold, silver, copper, palladium or platinum.

Paper money, simplistically speaking, is called fiat (fee-yott) money. The value of the money is set by declaration of some controlling authority. Such a declaration is a “fiat” declaration — an arbitrary decree or proclamation, such as a royal decree.

When any country first creates paper money, it typically sets a relationship of some amount of paper to some amount of physical “something.” Back in 1913, the Bretton Woods agreement defined the US dollar as having a value of 35 pieces of paper dollars being equal to 1 ounce of solid gold. That was known as the Gold Standard.

Although this is a proclamation of value, whomever is doing the decree can’t just make up some arbitrary number. They’re basing the value on a more solid foundation, such as gold.

In 1975, President Nixon took the United States off the gold standard. That means he unlinked the value of a dollar from anything other than some badly defined concept of the gross domestic product. Nobody but the government can figure out what’s the total amount of “stuff” the country produces, so the government effectively can call the value of a dollar whatever it wants.

Nowadays, we have a world economy where many nations bid for goods and services around the planet. Money from each country is constantly being converted back and forth. To accomplish that, we have “currency exchanges,” and each country sets the “exchange rate” for its money.

The problem is that if one country starts printing too much money, other countries won’t agree with the exchange rate. With computers and instant, world-wide trading and banking, we now have a “market” made up of many different countries. Those countries agree or disagree with the exchange rate set by a country’s central bank.

The world right now disagrees with the exchange rate being set by the US Federal Reserve. Therefore, the true value of the dollar is falling in relation to what “we” say it’s worth.

Much more importantly, common citizens and wealthy people all can buy precious metals. Those metals are the same everywhere, so silver is silver no matter what country calls it something in their own language. Silver is a metal, with chemical properties unique and specified on the Periodic Table of elements.

For years and years (decades, even) big banks have been playing a scam. They purchase 1 actual, physical ounce of silver and put it in their vault. They then “sell” 99 additional ounces of silver, claiming they have it, and giving the buyer a piece of paper that says the buyer can redeem that silver…whenever.

All this means that banks are using the fractional reserve system for physical metal exactly the same way they use it for paper money. And THAT means that NOTHING a bank owns is worth ANYthing! They own empty space in their vaults, and only the naive ignorance of their customers keeps the scam going!

In 2008, there was a run on the banks. Goldman-Sachs, in a stunningly stupid move demanded that AIG (insurance company) prove it actually had the money to actually insure all the mortgages and loans they said they could insure.

AIG didn’t have the money.

When the news leaked out, people began grabbing their money out of banks as fast as possible. Then came the gigantic money-market funds, with hundreds of millions of dollars being “managed” for safe-keeping by all the big banks, and by Goldman-Sachs. They instantly, electronically removed their money from their investment accounts, causing a “digital run” on the major banks.

Within hours, hundred and hundreds of millions of dollars were sucked out of the banks in New York City. Just like in the movie, “It’s a Wonderful Life,” massive accounts, managed by human beings came into question. Was the money “really” there? Or was it all just a mirage. Better to be safe than sorry, and they pulled their money.

At that point, ALL the banks that were party to this kind of “air storage” fiasco SHOULD HAVE FAILED! There should have been a catastrophic meltdown of every single bank — any and all of them — that had participated in this kind of fraud, theft and robbery!

It didn’t happen.

The Federal Reserve and US Treasury authorized hundreds of billions of paper dollars to be placed instantly into the many accounts. Congressed instantly passed a money-market insurance fund, similar to the FDIC. Everyone around the world was told not to panic, “We have the money! It’s all here! Nobody will lose their money.” Just like in the Jimmy Stewart movie.

To keep this fraud going, the Federal Reserve has since been printing billions of dollars through the US Treasury. They lend them to the big banks, hoping those banks will then lend them to you and me. We’ll create businesses, buy microwave ovens and color TVs, and take vacations. We’ll spend, spend, spend, thereby causing a demand for more stuff.

Instead, the banks have used the money to invest in the stock market, commodities markets, and hare-brained schemes around the world! They’re not failing, they’re thriving! It’s like a bacteria whose main food supply is penicillin!

To make matters worse, the Federal Reserve is also “buying” any bad loans or failed paper contracts owned by these same banks. The rationale is that those banks are Too BIG to fail! It would decimate the world economy!

No, it wouldn’t!

People around the world actually produce things. We actually grow food. We actually build machines. Additionally, people around the world are buying up gold and silver by the tonne! The reason is that people around the world don’t believe for a minute that paper money is worth a mosquito fart!

General Motors was about to fail, mostly because of the same kind of non-productive loans and investments made by banks. These banks are NOT “the producers” of the world! They produce NOTHING! All the do is produce debt, loans, interest payments and mortgages. Long ago, banks used to!…produce economic activity, by loaning money to startup businesses. That’s all finished with.

GM was not allowed to fail! It was Too Big to fail! So the government bailed them out with paper money. Not with taxpayer dollars — there isn’t a chance in Hell that you or I or our descendants will ever in all of time come up with enough money to equal the government’s bail-out. The result was that GM became part of the walking dead. A Zombie! Much like the zombie banks, GM is now a zombie corporation.

Watch any zombie movie and the resulting events are inevitable. The zombies eat everyone’s brains and create more zombies. What’s the answer? Burn them until they’re really and truly, totally and incontrovertibly dead!

GM has to all intents and purposes, finally and at last failed. Their stock is worthless (even the government is trying to get out of it as fast as possible). Nobody give their cars the slightest bit of credibility anymore. If they’d been allowed to fail, there were many OTHER companies, much more organized and run in far better style that would have purchased the shattered remains of General Motors. That wasn’t allowed.

So too with the Too Big To Fail (TBTF) banks. They produce nothing, lend nothing, make nothing, fix nothing, buy nothing, risk nothing, and have nothing. They have no money. “Naked short selling” is basically a contract to sell something you don’t have to some idiot stupid enough to buy the piece of paper.

Right now, the TBTF banks are “short” massive amounts of silver. They’ve sold 99 ounces of silver “air” for every 1 ounce they own. At some point in the year, each month the bank has to either roll over those contracts by extending them, or they have to actually deliver on the silver.

Each bank only gets asked to deliver a small portion of their silver each month. Therefore, they can continue to “store in their vaults” 99 ounces of air for every dollar. And they charge a storage fee!

The world is waking up. People are buying silver. That means there isn’t enough silver for the TBTF banks to buy each month so they can meet their delivery obligations. They’re buying silver more and more desperately! And so the price is going up and up in paper money. In 1969, you could by a gallon of gas for 25-cents. Today, in silver at $48/oz., you can buy a gallon of gas for 13-cents.

Each piece of silver that YOU buy means the big banks canNOT buy it! And that means that as more and more people demand their silver, those banks won’t have it! At some point, they’ll have to declare the truth, in which case it won’t matter how much paper money the Federal Reserve pours into the bank: It will fail.

Do you care?

What actually would happen if all these banks failed? What actually would happen if the entire world economy collapsed? Would it? Or would only the Paper Economy collapse? Would nobody grow food suddenly? Would nobody buy oil suddenly? Would time stop, the seasons end and the sun explode?

Of course not! We’d very quickly move to a barter system, and within only months, NEW banks would be formed that worked with real money — paper money that actually was backed by something of value.

Only the financiers, politicians, and non-producers of fantasy “value” would disappear. Is that such a bad thing?

Don’t confuse real producers who use real capitalism to buy and sell real goods, with bankers and financial managers who only trade paper. We do NOT need to support those “producers” known as billionaires! They do NOT create jobs! They create NOTHING! They don’t even create paper dollars! All they create are promises of paper dollars in the form of certificates —- stock certificates, bonds, T-bills, silver futures, gold futures and so forth.

Before anything can possibly even begin to be fixed; before Americans can get back to living ordinary lives, we must reinstate basic competition! We must let failed companies and failed banks collapse. There’s no way we can fix anything without first getting rid of the pus and infection of the Zit banks.

Since these banks are stealing our houses and converting them to paper money, let’s paraphrase Marie Antoinette: “Let them eat fake!” THEN we can rally like the French peasants and say, “Off with their heads!”

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