Baby Boomers trapped between a rock and a hard place – 2 Updates

We are 62, our home is worth less than our mortgage, our retirement accounts have lost 35%, we are at retirement age with no ability to retire.  Our jobs are at risk, and the cost of living is escalating.

This is the challenge facing America’s Baby Boomers, the bulge in the population that was the driving force behind America’s burgeoning prosperity, from the Gerber baby food revolution, to the proliferation of disposable diapers, the expansion of home kitchen culinary offerings, better homes, cars, and schools.

We reached adulthood in a world bequeathed to us by the Greatest Generation, raised families, educated our children, and now face a world of great uncertainty.  The 1960s & 70s were a time of expansion of America’s productivity, as Americans responded to President John F. Kennedy’s call for engineers for science, space exploration, and the development of cities, roads, and infrastructure.  America was also producing teachers to teach the legions of citizens born between 1946 and 1964, the baby boomers.

We didn’t notice it at the time, but beginning in 1913, when the US Congress transferred control of out nation’s monetary system from the US Treasury to the Federal Reserve, a private central bank, which began a 100-year strategy with a goal of hijacking wealth from the middle class to growing US plutocracy.  President Richard Nixon’s reneging on the 1944 Bretton Woods Accord by slamming the gold window shut on France on August 15, 1971, commenced the exponential growth of the US Monetary System to a runaway fiat currency, accelerating the devaluation of the US dollar until today’s US dollar is only worth 5% of a 1971 dollar.

Today’s baby boomers are trapped, more than 50% of the real estate equities were lost, 35% of retirement savings were lost, and private/public pension funds all over America are under funded by trillions of dollars.  What remains of US citizenry liquid assets are earning below 2% while inflation is in excess of 5%, this phenomenon, combined with staggering unemployment and under employment, accented by more than 25% unemployment of young people under 25, the prospects are dim.

While the country seems in bad shape, it is actually getting much worse, while the government is optimistically crowing about adding 200,000 jobs monthly, they conveniently omit mentioning that our population growth demands 300,000 jobs per month, to stop unemployment from rising further.

The ‘free markets’ that fueled America’s growth and prosperity in the 1960s to the 1980s are now so artificial and manipulated that sound money management and investment guidelines no longer exist.  The money markets are being manipulated by central banks of the world, gold and silver are being manipulated by central banks, private banks, sovereign governments, hedge funds, and big business.  Natural resources, such as oil, gas, coal, copper, rare earth minerals, have potential wars coalescing around source countries.

The US and the rest of the world has made few inroads to developing alternative fuels for a fossil fuel hungry world, and, currently all alternative fuels are economically not sustainable.

The most obvious symptom of the imminent collapse of the US Monetary System, burgeoning sovereign debt, is now careening out of control.  US money in circulation is created out of debt.  US debt instruments are sold to expand the money supply, who, or what, is buying these instruments?  The US government and the national media suggest the foreign governments such as China, India, Great Britain, etc.  The truth is, the US Federal Reserve is currently buying 61% of all US debt instruments, creating the largest Ponzi scheme the world has ever seen, and we all know the ultimate fate of Ponzi schemes.

In light of the foregoing, with the walls closing in on us from every angle, the sovereign countries of the world are experiencing a leadership vacuum.  In Europe, America, Asia, South America, and Africa, politicians are trapped in election cycle gamesmanship, and choose to avoid dealing with problems that can be postponed to beyond the next election (2 years, 4 years).  We see this phenomenon in the Eurozone (kicking the can down the road, with Greece, Ireland, Portugal, Spain, and Italy), the US President & Congress (the Debt Ceiling, the Budget, etc.), Japan (nuclear accident, enormous debt, aging population, brain drain, etc.), and on and on.

Until visionary leaders reveal themselves through sheer commitment, clear direction, and producing desirable results, this entire generation and those that follow will find themselves trying to walk uphill in peanut butter.

The Fed’s low interest policy, does nothing but over-inflate stock values (If you essentially have zero capital costs, how could you avoid being profitable?), yet, since the low interest is artificial, then the stock equity is also artificial and cannot be sustained.  Bank over leveraging has resulted in the public and private banks having no real capital, which only serves to make the inevitable collapse to be even more dramatic (If you have no capital now, how does dramatically expanding your balance sheet, assuring your institutional bankruptcy, add stability to the US Monetary System?).

Without free markets and a stable monetary system, how can the 10,000 people per day, turning 65 in the United States, over the next 20 years, find their way out of this economic wilderness?  This is the key question of this decade, and we have no real leaders taking the reins to get us on the road to recovery and prosperity.

Let’s get this show on the road.  I’m mad as hell, and I’m not gonna take it anymore! – Howard Beale (Network [1976])

Geoff

Postscript: April 10, 2012 Greeks Rush to Pass Handouts Before Austerity – NYTimes.com: http://www.nytimes.com/2012/04/10/world/europe/greeks-rush-to-pass-handouts-before-austerity.html?_r=1&emc=tnt&tntemail1=y

PS2: April 10, 2012 Revisited: Three data points which prove that the Euro cannot be saved – Gains Pains & Capital — An Investment Newsletter From Phoenix Capital Research: http://gainspainscapital.com/?p=1643

References:

1) March 30, 2012 European Bailout Stigma Shifts From Banks To Sovereigns As Bundesbank Refuses PIG Collateral | ZeroHedge: http://www.zerohedge.com/news/european-bailout-stigma-shifts-banks-sovereigns-bundesbank-refuses-pig-collateral

2) March 30, 2012 Testosterone Pit – Home – Greece: They’re Not Even Trying Anymore: http://www.testosteronepit.com/home/2012/3/30/greece-theyre-not-even-trying-anymore.html

3) March 27, 2012 Oil Production in the 21st Century and Peak Oil: http://oilprice.com/Energy/Crude-Oil/Oil-Production-in-the-21st-Century-and-Peak-Oil.html

4) March 30, 2012 Germany is Now Openly Engaging In Monetary Policies Against the ECB… What’s Next?  http://gainspainscapital.com/?p=1580

5) April 2, 2012 World’s Largest Solar Plant, With Second Largest Ever Department of Energy Loan Guarantee, Files For Bankruptcy | ZeroHedge: http://www.zerohedge.com/news/worlds-largest-solar-plant-21-billion-energy-department-loan-guarantee-files-bankruptcy

6) April 3, 2012 Putting It All Into Perspective | ZeroHedge: http://www.zerohedge.com/news/putting-it-all-perspective

7) April 6, 2012 Bernanke Knows Europe is Out of Options and On the Verge of Collapse: http://gainspainscapital.com/?p=1632

8) April 8, 2012 India’s Jewellers End Gold Strike As Government Caves On Excise Duty: Pent Up Gold Demand To Be Unleashed | ZeroHedge: http://www.zerohedge.com/news/indias-jewellers-end-gold-strike-government-caves-excise-duty-pent-gold-demand-be-unleashed

9) April 8, 2012 America: A Government Out Of Control | ZeroHedge: http://www.zerohedge.com/news/america-government-out-control

10) March 28, 2012 WSJ: Fed Buying 61 Percent of US Debt: http://www.moneynews.com/Headline/fed-debt-Treasury/2012/03/28/id/434106

 

This entry was posted in Asia, China, Civil Disobedience, Debt, Economics, EU, Fragile Markets, Geoff Yuen, Government, Monetary, Philosophy, Politics, USA and tagged , , , , , , . Bookmark the permalink.

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