Austerity About-Face: German Government to Gamble on Stimulus

The last hawks have caved to the doves.  Inflation here we come.

http://www.spiegel.de/international/europe/german-government-to-test-stimulus-instead-of-austerity-a-901946.html

Pento - What Will Cause Markets To Crash & Will It Happen?

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2013/2/24_Pento_-_What_Will_Cause_Markets_To_Crash_%26_Will_It_Happen.html

The Myth of Austerity

http://mises.org/daily/6289/The-Myth-of-Austerity

Great Latvia Success Story!

http://youtu.be/3IRUBJ8qraY

Richard Russell - A Bitter Pill to Swallow, Austerity or Inflation

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/2/14_Richard_Russell_-_A_Bitter_Pill_to_Swallow%2C_Austerity_or_Inflation.html

Wisconsin Gov Puts National Guard On Alert After Implementing Emergency Budget Measures

Is this Greece?  Ireland? Egypt?  No, it is Madison, Wisconsin.  Expect to see  more of this domestically as "austerity" measures are implemented in an attempt to resolve budget deficits.

http://www.shtfplan.com/headline-news/wisconsin-gov-puts-national-guard-on-alert-after-implementing-emergency-budget-measures_02172011


http://www.youtube.com/watch?v=_AbeAcTiFFc&feature=player_embedded

QE in Europe

http://www.guildinvestment.com/2010/11/23/just-a-few-points-before-this-holiday-week/

QE in Europe— the European sovereign debt situation

It is not surprising that Europe’s short embrace of austerity has been unsuccessful.  There is never a choice for austerity until all other alternatives have been exhausted.  History is replete with examples.  Why don’t some of these stock market commentators read some global economic history?  It is obvious now and has always been obvious that Europe will go for QE.  It does not matter what they say about austerity.  We have been advising investors to watch what they do.  They are bailing out Ireland; Portugal is right behind and will be followed by Spain, Italy, and even France in the future.  There is no solution that politicians will embrace other than QE [money printing] because a program of austerity means the end of their political careers.  They will put their careers above the national interest.

It is absurd to believe that the U.S. dollar will be a safe haven over the intermediate term

An even more absurd belief is the one that puts U.S. dollar and U.S. debt as a safe haven.  There is not any convincing economic evidence that the U.S. dollar is well managed, and there is no reason to believe that the dollar will rise in value.  In fact, it is the U.S. governments’ intention to devalue the dollar and to print money to avoid a deflation in the U.S.  Why do some global commentators see the dollar as a safe haven?  In our opinion, the only safe haven is precious metals, energy, food and other assets which will hedge against the inevitable inflation that the above policies create.

Irrelevant politics

http://dollarcollapse.com/articles/why-we%E2%80%99re-ungovernable/

So what’s happening? Just a few years — in some cases just a few months — after sweeping into office with promises of “change” and a quick clean-up of their predecessors’ messes, leaders of major democracies from across the political spectrum are in being swept right back out.

Did they turn out to be incompetent, or their policies wrong-headed? There’s hardly been enough time for either verdict. But if not that, what?

The answer, in a word, is debt. When an economy’s borrowing passes an historically identifiable point it loses the ability to navigate from crisis to solution. In the case of Europe, Japan, and the U.S., the range of choices has narrowed to only two, inflation and austerity, and neither are working.

When Europe tried inflation by promising to bail out the PIIGS countries, the euro collapsed, as the global markets correctly saw an oversupply of paper currency on the horizon. When it switched to austerity, workers across the continent saw their livelihoods threatened. Either way, the folks in charge get blamed and have a tough time holding their jobs.

Starvation already hitting parts of Europe

http://www.zerohedge.com/article/john-taylor-worlds-largest-currency-hedge-fund-sees-euro-dropping-120-august

These are what "austerity measures" yield.

More quantitative easing

As predicted, and against a backdrop of Fed-speak about "exit strategies" several months ago, the Fed is continuing to implement quantitative easing, i.e., printing money out of thin air. The Fed will do everything in its power to avoid another Greek "austerity" situation, delaying the inevitable currency crisis as long as possible.

Treasury Secretary Tim Geithner has also declared the US government will never lose its AAA credit rating. Moody's, the credit ratings agency, says the possibility is very real, due to soaring debt levels and deficits. Fed Chairman Ben Bernanke, former Treasury Secretary Hank Paulson, and former New York Fed Governor Geithner completely missed the housing bubble, financial crisis, and deep recession in their testimonies. Why should any of us believe them now?

https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi67iwyHumnupeWuGg7qEQ2To9GBola6OEBode3_nmkIxKUE4AqQOSD2JgQ5ueibOXmzWMb_watYDMc0WFncI18s84s3ZLO5SjWlIdz2HFDsv7ta9S2GaO48XUnlHsrODf4sAUmosmdK24r/s1600-h/BOGAMBSL.JPG

LA on the brink

http://www.guardian.co.uk/commentisfree/cifamerica/2010/feb/25/financial-crisis-useconomy

While the federal government has considerable wiggle room to borrow or simply increase the supply of money to help fight its way out of financial collapse, smaller government units in America don't have those options; increasingly cities, counties and states are facing the sorts of austerity measures we've come to associate with third world countries in crisis, or, in recent years, with vulnerable European nations such as Greece or Latvia.

The broader economy may be starting to show some signs of healing, but for those at the bottom of the economy, for those most reliant on government services in Los Angeles and the countless other cities teetering over financial abysses, 2010 looks more like a bona fide Depression year than one made beautiful by the myriad green shoots of recovery.

The case against Keynesian Economics

Despite a raging battle among economists on the solutions to preventing and solving financial crises, it's becoming more apparent that Keynesian Economics is a total failure ultimately. Long live Austrian School of Economics!

http://www.bloomberg.com/apps/news?pid=20601039&sid=a5t.xQdllnbo

Greece outlawing cash transactions

As part of their movement toward "austerity", the Greek government is outlawing cash transactions and levying higher taxes, including enacting a value-added tax (VAT), increasing the capital gains tax, and repatriated funds. They are also cutting wages of some state employees by 50%.

In essence, they are trying to eliminate the black market, while shutting down their borders from further capital flight. This is the playbook for bankrupt sovereign governments. US citizens take note--this movie will be playing in a theatre near you.

http://globaleconomicanalysis.blogspot.com/2010/02/greece-outlaws-cash-transactions-above.html