Anything written by Bob Chapman can be taken as gospel, I've ever seen anyone disagree with him.
http://www.infowars.com/?p=7280
Just The Early Stages of Economic and Financial Collapse
Bob Chapman
The International Forecaster
January 21, 2009
The real estate crisis is probably about 40% over. Theyll be further
declines, residential and commercial, and then a basing out period
that will take several years. The injection of cheap interest rates
and a stimulus package of $825 billion are going to temporarily delay
the downside. Instead of ending in 2011 it could extend to 2012.
Citigroup is bankrupt. Its 4th quarter loss was $8.3 billion. Bank of
America posted its first loss since 1991 of $1.8 billion. One day they
requested $10 billion from the government. The next day it was $20
billion.
Citigroup is being dismantled as a failed financial supermarket.
Sanford Weill who created this monster some years ago created a total
failure. That is why we recommended a short on the stock at $44.10. In
order to keep this loser business a new bad bank is being created to
dump all of Citis mistakes into. Those would be toxic securities and
worthless derivatives. That is $850 billion of Citis $1.95 trillion
of total assets. What a disaster. Almost half their assets are near
worthless, something we pointed out 3-1/2 years ago. Government has
already sunk $45 billion into the bank and backs $301 billion of its
toxic garbage and securities. Citi is a major shareholder in the
Federal Reserve.
Bank of America has now received $45 billion with guarantees on $118
billion of toxic waste. It too is a Fed shareholder and it too is
broke.
There is now no question that all the legacy or money center banks
will be merged into one nationalized bank, which we believe was the
intention from the beginning. This will make it easier later in the
formation of a One-World government to merge US banks into a world
bank that will disperse a world currency. Government is going to take
an ever-increasing role in bank ownership and in credit policy, as
would be expected in any fascist government.
We are still in the earliest stages of an economic and financial
collapse, which was deliberately engineered to bring about eventual
total control of our economy and financial system. Except for
government and the Fed, Wall Street finance has been incapacitated.
The government and the Fed are left to do as they please. Our bought
and paid for Congress will rubber stamp anything handed to them. Bank
credit will surpass $1 trillion this year to keep the elitist banks
solvent and to delay the forces of deflation and depression. Overall
credit expansion will expand to $2 trillion plus as many more banks,
brokerage houses, lenders, insurance companies and illuminist
corporate giants are served up all the cash and credit they need to
survive. Very little will ever be paid back. Once the grip of the Fed
and our Treasury is complete it will be almost their sole
responsibility to extend credit. The excuse will be it has to be done
to save the system as they chip you and give you a debit card and set
up currency and exchange controls, devalue the dollar and institute
wage and price controls. We then become wards of the state. They have
allowed the banks to get into such awful shape, that they will tell
you that they and America have no other option but to have government
and the Fed mandate what will be done to save the system.
These conclusions can only be reached if you understand the powers
behind government, their history, and what their goals are. This is
why we have been able to predict what has been going on for years.
Very few writers understand and many choose to keep their months shut
because they fear for their lives. This has been an almost 50-year
odyssey for us and we refuse to hide the truth. If you do not
understand the history of the Illuminati you are in a quandary. It is
the missing link that ties all the events together. You cannot use
macro analysis without knowing the history of what these evil butchers
are up too.
We get the question why was Lehman Brothers allowed to go under?
This was a seminal event in US and global finance. It had to be done
to take the system down even though Lehmans owners were ultimate
insiders. Why do you think you do not hear a peep out of Wall Street?
It is because the key people in the key firms are in on it and taking
orders - that is why. In the blink of an eye trillions of dollars were
lost. That amount of money is meaningless when you own the system. You
can just create more. It is the power to create and control money and
credit that always wins the day. The loss of confidence and trust now
worldwide was deliberate. It allowed central banks and governments to
totally control their fiscal and monetary systems. Essentially there
was no one left to do so. Within the financial community those who
understand what is happening dare not say a word or theyll lose their
companies or their lives. That is why there is no opposition from
within. How can any thinking person put their trust in a government or
a private Fed that has gotten us in war after war. How can any
thinking person put their trust in a government or a private Fed that
has gotten us into war after war and one financial debacle after
another be trusted? They cant be trusted. They are the enemy. Think
it through and you will get it. Read the Creature from Jekyll Island
by G. Edward Griffin and other books we recommend and you will finally
understand what is being done to you and who is doing it. The most
corrupt people on earth. The ability to print money and create credit
is the ultimate power. It allows you to control everything.
Today we have allowed our government and the Fed via our elected
representatives to use money and credit to control our financial
system. These deficits and guarantees will not be sufficient to
stabilize and save our current financial system. Hyperinflation will
rage and depression will ensue. Out of this the elitists hope to
create their World Government while the world is financially and
economically on its knees.
First will come repudiation of debt via default and devaluation. Then
a new national currency to be followed by a world currency, followed
by a chip or a debit card. Everyone throughout the world will be
controlled. If you say or write anything negative regarding the New
World Order your chip will be disabled or your debit card will be
disengaged. Then you become a fugitive to be hunted down and
exterminated. This is what is in store for us. This is what these
people are up too. This isnt intrusion, this is dictatorial
government and this is where we are headed.
The answer is clear and we saw this years ago. The financial system
is to be collapsed in stages that are manageable. You are seeing that
in part with the collapse of the financial sector and the securities
of these companies. This is caused by eventual government and Fed
control of and nationalization of the financial industry. This will be
followed by the collapse of stock markets worldwide.
This is not gloom and doom . This is reality and the truth. The
financial system will not stabilize. It is being deliberately changed.
The Treasury is crowding out corporate borrowers in their quest for
liquidity, as corporations rush to raise what funds they can to allow
them to keep functioning and so that they wont be absorbed by an
elitist mega-company of our new corporatist state. At the same time
municipalities are raising all the money they can to keep from going
under having far overextended themselves.
Dont be fooled by the respite you will see over the next nine months.
It wont last. It will be a consolidation period. Government and the
Fed will be planning their next moves, as the stock market moves
lower, along with bonds as long dated interest rates move higher. If
you wanted to refinance do it now. You will never get a better
opportunity.
The crisis is here and ongoing. The financial stocks are telling us
there is a rocky road ahead. If the market was going to rally it would
have already happened. It tried to breakout over Dow 9,000 and was
unsuccessful. Underlying everything are lies, corruption and acute
stress not visible to the public. Even many old Wall Street types do
not get it and that is because they refuse to believe the actuality of
what is happening behind the scenes. Those behind the scenes know full
well what is going on and they are not going to fill in the rest of
Wall Street, banking, government and corporate America that do not
have a need to know. Housing will fall another 10% to 25% dependent on
area and circumstances and more and more foreclosures will hit the
market, as millions of jobs are lost. In addition, the entire world
will experience this process, which worsens the situation. There is
still de-leveraging to be dealt with along with the monstrous
derivative problem. Focus has to be on wealth preservation and safety
of person and assets. The core is your water filter, freeze dry and
dehydrated food, family protection and gold and silver related assets.
The subprime and ALT-A borrowers will have reset or fallen by the
wayside by the end of June. Now those in trouble are not lower income
borrowers, but middle-class and upper-middle class homeowners. Some
own Option ARM-pick-and-pay loans they cannot now afford or homeowners
who never thought they will lose their business or get laid off. We do
not see the downside nightmare hitting bottom until 2011. It may well
be later due to trillions of dollars in artificial stimulus. About
half of borrowers are under water and all are seeking a break from
their lenders. The lenders are making few concessions. There are now
no stereotypes, anyone can become a victim.
The Option ARMs are clustered in California, Arizona, Nevada, and
Florida and outside the Washington, DC area.
On top of these underlying mortgages are unemployment and crashing
home prices that have left a great percentage of homeowners under
water.
The latest statistics we have show long-term unemployment at 17.8%,
intermediate U6 at 13.8% and the phony government media figure at
7.2%. In one of the hot spots we estimate U6 to be near 16%. In 2005
and 2006 this region saw construction make up 11% of the job base.
There are many formerly prosperous people who had equity, no debt,
great FOICs who have lost jobs, closed businesses, have no equity,
just debts. They have maxed out the credit cards and gone through all
their savings and retirement.
There are lenders who are making deals to help homeowners, but not
many.
Some borrowers walk away in spite. The home next door is in
foreclosure and is selling at a deep discount, which in turn put the
neighbor under water. It feeds on itself.
Then there are those who refuse offers. Many of them just do not like
owning their own home.
All we can say is there is plenty of pain ahead.
The players who made this all possible, the Fed, lenders, rating
agencies, mortgage originators, appraisers, salespeople and buyers are
for the most part walking away. The buyers and lenders are stuck, but
government is bailing out the lenders not the buyers. The rest are
going out of business or losing their jobs. The exception is the
rating systems.
The raters, S&P, Moodys and Fitch were the key to the biggest
economic and financial calamity since the Great Depression. Why didnt
we have criminal charges brought against these crooks or at least
civil action? These miscreatants gave complex, opaque toxic mortgage-
backed securities AAA ratings when they knew they should have had BBB
ratings, in conclusion with the Fed and the lenders. This stamp of
approval allowed other crooks to market destructive securities
worldwide. Some would have us believe that putting a financial floor
under these players would solve our problems.
That is not the way it works. Bailing them out accomplishes nothing.
It just extends the problems into the future.
The raters now very concerned are sending credit warnings to
governments, threatening to downgrade their sovereign debt ratings if
they allow their fiscal deficits to increase too much. As a result
Greece has had their rating lowered and Portugal, Ireland and Spain
have been warned by S&P to fix their public finances or face
downgrades. This increases the cost of raising funds and is taken as a
signal to avoid these securities. Next is the UK, US, France and
Germany. This is lose-lose for all sovereign nations where tax revenue
is falling, social spending increasing and stock and real estate
markets collapsing. No professional should be surprised at these
results. We forecast all this six years ago. Of course, no one wanted
to listen.
The tact that has been chosen is one of disaster. Lowering ratings at
this stage is an exercise in futility. The world financial system has
deliberately been destroyed. The only real question is when will
hyperinflation end and read deflation take the advantage and flatten
the system?
It will take $2 to $5 trillion to bail out Americas banking system
and in the process nationalize it. Government is the only entity
capable of bailing out the banks. Do not expect the Obama team to stop
the bailouts theyll just demand a little more equity. What should
have been done is that these crippled financial companies should have
been allowed to fail.
http://www.infowars.com/?p=7280
