Financial Protection
How To Survive the US Financial Collapse and Thrive
The Dollar is Heading for Collapse
A perfect storm is developing in front of our eyes:
- 1. The path of the dollar and inflation.
- 2. Why the dollar's value is falling.
- 3. How banks are affected by housing and credit problems.
- 4. The condition of banks and the Federal Reserve's response.
- 5. The financial endgame.
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The path of the dollar and inflation
The U.S. Dollar Index measures the value of the dollar against six major world currencies. The dollar continues to hit record lows.
Oil producers have increased the price of oil in order to make up for the loss in value (inflation) of the dollars they receive.
Total U.S. debt grew from $5.6 trillion in 2000 to $9.4 trillion as of May 2008, a 67% increase. The federal government spends $1.3 billion more per day than it takes in. Government liabilities, including net social insurance commitments, now total $54 trillion and will continue to grow.
The government must create dollars to cover its deficit spending. As each new dollar is created, the value of all dollars is reduced. The money supply is currently growing at an annualized rate of 17.2% and is accelerating. The rising amount of money causes inflation. Higher prices are the effect.
How banks are affected by housing and credit problems
Mortgage-backed debt writedowns now total $140 billion. While that has already caused huge losses for banks and investment houses, it is only a tiny fraction of the $6.4 trillion securitized debt outstanding.
Nearly one million foreclosure filings have occurred from January through April 2008. Foreclosures will trigger additional devaluations of mortgage-backed securities in the hundreds of billions, causing even greater losses for banks.
Banks are facing insolvency because of their junk securities. The condition of banks is reflected in the falling prices of bank stocks. The bailout will put $700 billion - new money - into banks in exchange for paper nobody else would buy.
The Federal Reserve has given $700 billion in emergency loans to banks and investment firms since last December. As collateral the Fed has accepted securities that the banks could not sell to anyone else. It is a trade of illiquid assets for liquid assets, which the banks then use to make loans, thus increasing the money supply.
The financial endgame
Sovereign nations that cannot meet their financial obligations typically resort to the currency printing press. The inevitable result is debasement of the currency. This is the course the U.S. government and the Federal Reserve have taken.
The unfolding bank solvency crisis and the attempts to prevent a systemic collapse have accelerated the debasement of the dollar. Its purchasing power is falling rapidly, and soon foreign investment in the dollar will also begin falling. When substantial foreign investment starts to flee the currency for safety elsewhere, the Federal Reserve will be forced to monetize the U.S. debt instead of selling treasury bonds.
At that point the currency printing presses will be running full speed. It will be the beginning of a U.S. hyperinflation. Nobody can predict when it will happen. Since most financial activity is electronic, when the unraveling begins it will progress very rapidly. The timing of the fall does not matter, however, if you are prepared.
You can act to protect your financial future!
Learn:
How To Survive the US Financial Collapse and Thrive provides a clear and comprehensive picture for making informed decisions about your financial future in language anyone can understand. And you can have it immediately.
Fewer than one in a hundred understand what's happening — and even fewer know what to do about it. You owe it to yourself to be one of those who do.
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EXTRA:
Included in How To Survive the US Financial Collapse and Thrive is a link to download the additional ebooks:
• Safe places - where might be good places to be if you don't want to stay in Europe or the United States
• Amateur radio - how to communicate worldwide - and even send video and text if the internet goes down
• Electromagnetic shielding - how to safeguard electronic components from EMPs, whether man-made or natural
• Health and well-being - staying in good shape off the grid
• The safeguarding of assets - Gold and silver, and what to do with it
• Survival awareness - staying alive in non-optimum situations
• Free energy - how to build your own free energy devices
Several people have asked if it's too late because the dollar has already "collapsed." No. The decline has been orderly so far. The spiral has not yet begun.
There's no need to say to yourself some day, "I wish I had known."
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