By Al Thomas
This is not a happy column. It is one that I hope I am completely wrong, but the facts are screaming. The public will not hear them from the major media.
The media including radio, TV and newspapers is afraid to speak. The owners of these journals realize they will be subject to the wrath of Washington if they do. Anyone that can do 2 + 2 = 4 should be able to see the consequences of the central government actions.
Don’t listen to their words. See what they do.
The public does not understand GDPs (Gross Domestic Product) and trillions of dollars. Joe Sixpack earning less that $50,000 per year knows about his monthly mortgage payment, insurance, car payment and food bill. Those big bucks are meaningless.
We all want to be paid our Social Security. It is the money we are forced to pay every week. We want it back. Now Washington is calling it an “entitlement”. Huh?
When it was created in the 1930s it was voluntary and was put in a Trust. That’s a joke. Congress has stolen it all. It is the biggest Ponzi scheme in the world. There used to be 16 people paying into the so-called trust in 1950 for each one taking out. Now there are only 3 paying. Ponzi wins. You lose.
Based on these numbers SS will go broke in just a few years. This would not have happened if the politicians that we elected had not stolen the money and spent it on their pet projects. It is our fault for not locking the barn door many years ago. We thought we were getting “free stuff”, but we were stealing from ourselves.
The same story applies to our “free” medical care. The federal government has not made enough money from taxes to pay for the benefits. Each year the elected criminals have been “giving” us more.
There has been no money to pay for all the freebies. So where does it come from?
Politicians created a thing called the Federal Reserve that is allowed to print money out of thin air. It is not Federal and has no Reserves, but the pols made a law requiring us to accept these pieces of paper and call it money. The more they print the less purchasing power it has.
Here is the kicker. When the Fed doesn’t have enough assets to back the paper dollars they issue Treasury Bills (government bonds) and sell them to foreign countries like China and others. It is getting to the point where foreigners don’t want to buy them. BUT, big BUT, we still have to pay the interest on all those bonds that have been issued.
It is very obvious that unless the central government stops spending more that they take in the Fed is not going to be able to pay its obligations. And who is the one responsible for those bonds – right! The taxpayers. Us. You and me.
That, in simple terms, is the FISCAL CLIFF.
Al's new ebook (32 pages) is available on Amazon for 99 cents. It explains the Golden Cross and the Death Cross. These are well known methods of determining long term trends in the market. If you only learned one method of technical analysis this would have kept you out of the 2000 and 2008 crashes and will keep you out of the next one that is coming soon. The title is Never Lose Money In The Stock Market Again. Copyright Williamsburg Investment Co 2013