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Financial Crisis And Peak Oil


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http://www.321gold.com/editorials/browne/browne101708.html

U.S. Economy Still on Life Support

John Browne

Oct 17, 2008

On Monday October 13th, the Dow took the fifth biggest upward leap (in percentage terms) in its history and, most notably, since the 1930's. It appeared that Paulson and his fellow G-7 finance ministers had solved the credit crisis. Despite the fact that G-7 taxpayers will be stuck with $3.5 trillion of liabilities to support their governments' bailout plans, the stock markets nevertheless bustled with euphoria. The next day, reality dawned once again, and all markets closed down.

The truth is that these enormous bailouts enacted around the world, most notably in the United States, have done little or nothing to tackle the enormous deleveraging that is driving us into a serious recession and, if badly handled, a depression. Increasingly, politicians and commentators are talking about the need for a massive, new stimulus package, likely to cost trillions more dollars.

The extraordinary thing is that virtually no one dares even to mention the real underlying problem--that America has for the past thirty years been consuming more than it produces. During that time, the American consumer, accounting for 72 percent of Gross Domestic Product (GDP), has been financed from the retained earning of foreigners, most notably of China, Japan and more recently Russia.

Based on the willingness of these foreign producers to provide the funds, Americans have engaged in an orgy of easy credit and excessive consumption. In short, America is no longer paying its way, and is living off the earnings of its economic neighbors.

It is a rake's progress and can not last much longer, especially as the creditor nations, such as China, will soon need their own money back in order to finance their own leap to 'developed' economy status.

Millions of words have been spoken over the last month alone about how America must solve its economic and financial problems. But the stark realities that will result from massive deleveraging in the face of a massive recession have been barely considered. Apparently, no one dares to mention it.

We feel our readers should maintain an acute awareness of these underlying problems, particularly as the Presidential candidates, financial regulators and Wall Street cheerleaders appear bent on concealing the underlying truth.

The $3.5 trillion thus far committed to lubricate the credit markets have yet to produce any meaningful result. Even that vast total is unlikely to be sufficient to meet the tidal wave of bad loans yet to hit the banking system.

As the massive Bush-Greenspan credit orgy deleverages, corporate profitability is likely to fall dramatically, driving stock prices still lower, further eroding personal retirement accounts. Once confronted with unemployment and bleak prospects, even those who have been model financial citizens will be forced to default on credit card debts, auto and personal loans and, of course, home mortgages.

The tsunami of defaults crashing into our banking sector will ultimately overwhelm all government attempts to contain the damage.

As the mighty American economy shrinks, other countries, such as China, will see their export earnings fall. They may have to sell parts of their vast holdings of U.S. Treasury bonds, driving still higher the cost of dramatically increased U.S. Government borrowing.

On average and adjusting for inflation, U.S. equities have under-performed badly in this century. This will continue until America restructures itself to produce more than it consumes.

Meanwhile, the short-term Treasury bonds of hard currency governments, some offering negative yields, will continue to perform well in capital appreciation against the U.S. dollar.

China is likely to experience genuine, profitable systemic growth. However, in 2008 its stock market has fallen by some fifty percent. As a result, China and the BRIC countries could present good investment opportunities as we move into 2009.

As the recession deepens, gold could fall in price, at least in the near to medium term. But, the world's financial system will remain precariously balanced for some time, which will create a floor for gold. Furthermore, the vast amounts of 'monopoly' money now being injected into the major economies will eventually show up as inflation, possibly even threatening the viability of paper currency. Prudent investors will continue to hold a major allocation in gold.

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Guest SatwantBeantKehar

These are some very tough times we are living in - unemployment will soon exceed 10% and ofcourse we are/have already peaked in global oil production - this is a perfect storm - time to store food and weapons.

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These are some very tough times we are living in - unemployment will soon exceed 10% and ofcourse we are/have already peaked in global oil production - this is a perfect storm - time to store food and weapons.

It's only a tough time if you beleive it is, theres no need for anyone to worry.Those imbued in the love for God are kept happy in all ages.

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These are some very tough times we are living in - unemployment will soon exceed 10% and ofcourse we are/have already peaked in global oil production - this is a perfect storm - time to store food and weapons.

It's only a tough time if you beleive it is, theres no need for anyone to worry.Those imbued in the love for God are kept happy in all ages.

Its not about worrying, its about being aware of whats happening around you. thats it..

I have been writing this doomish stuff for about 8 months I think and what ever I wrote is coming true. I wrote about "decling value of college education and not to get into debt" and u know what thats exactly what has happened. Young adults in north america have been ruined by debt. I really dont want to get into any debates. I will just post some news once in a week or so..............

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These are some very tough times we are living in - unemployment will soon exceed 10% and ofcourse we are/have already peaked in global oil production - this is a perfect storm - time to store food and weapons.

I am surprised by this reply...... I feel you are the most intelligent guy on this forum, hahahahahahahaha.....I feel this is what is to be done ....

1. Make some gursikh friends who are anakhi and not greedy(kachriyaan seoo torr...... dhonnnd sajjan sant pakkiyaan) and will stand by u in tough times.

2. Store food and weapons. Teach basic gatka to all women, and young kids....

3. Start to memorize lots of baani and start to read lots of Dasam Bani. Make Chandi di vaar, first part of Shastar Naam Maalaa a part of your nitnem and if possible read "sri kaal je ke ustatt" which is at the starting of Sri Bachitar Natak.

4. Keep a strong pehraa of Sarbloh bibek and always remain shastardhaari....

5. If u are living in a place that is very cold, u need to think about relocating. Choose a place that has a moderate climate, plenty of rainfall, less population density and has a good growing season..

6. Start to learn some gardening skills

7. Bring your body in shape.. THATS VERY IMPORTANT. Do some quick walking and push ups everyday....

8. Get ready to die for your Guru.... and the Guru will protect you... Guru is God and God is Guru. Bow ur head only in front of Guru Nanak Dev Jeee Maharaaj.... Ur head shud be cut before it gets lowered in front of anyone else....

JEUNNAAA ANAKH, MARRNA DHARAM(sikhi) LAYEE.....

9. Any person who attacks sikhi, gurughar, gurbani, REMOVE HIS KHOPPRAAAA.

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http://www.independent.co.uk/news/business...sis-972762.html

Britain plunges into a 'once in a lifetime crisis'

Renewed fears of a global recession sent the world's stock markets into a state of capitulation yesterday.

The UK economy shrunk for the first time since 1992 during the third quarter of this year, declining by 0.5 per cent, far worse than anticipated. In what the Deputy Governor of the Bank of England, Charles Bean, described as "a once in a lifetime crisis, and possibly the largest financial crisis of its kind in human history", investors fled from shares and virtually every other investment into the few safe havens still remaining, usually US Treasury securities and the Swiss franc.

The FTSE-100 index of leading shares fell by 5 per cent to near the lows seen during last week's gyrations. Tokyo was down almost 10 per cent, Moscow suspended trading and on Wall Street the Dow Jones industrial average also opened lower.

Dazed dealers could only respond with resignation. The banks were once again marked lower, with concerns that they may be unable to cope with the debt write-offs and losses from a protracted economic slowdown. But anxiety that even the strongest of corporations' profits will suffer from the downturn, from bad debts and difficulties financing themselves permeated every corner of the investment world.

Confirmation that the UK could indeed be on the brink of a recession deeper and longer than even the most pessimistic had feared came with the publication of the latest official figures on growth. The annual growth rate has sunk from 1.5 per cent to 0.3 per cent, its slowest pace since 1992. The 0.5 per cent shrinkage during the third quarter follows the zero growth recorded in the second quarter and leaves the nation firmly on the road to recession.

The pound continued its slide, moving close to the $1.50 mark, a six-year low – it saw its biggest one-day drop against the dollar in 16 years, falling to $1.52, before rebounding slightly to $1.58 in London trading. Last night sterling stood at an all-time low against the euro – one euro is now worth 82p. Against all currencies it is down about 15 per cent from its peak last year, and is suffering its sharpest declines since sterling was ejected from the European Exchange Rate Mechanism in 1992.

Even so, the beneficial effects on exports have yet to feed through, and the slowdown in the economy is spreading from banks to the wider economy. The GDP numbers showed that manufacturing fared badly once again, as the short-time working announced in so many British car plants in recent weeks had suggested, while the services sector, and in particular retail and distribution, is also suffering. The retail motor trade stood out as a disaster zone. The only areas of growth are in agriculture (just 1 per cent of the economy) and the public sector (around 40 per cent, and set to expand still further as the Government brings forward major infrastructure projects such as the 2012 Olympics and Crossrail).

The numbers were much worse than forecast, and City economists were outbidding each other in their description of the awfulness. Philip Shaw of Investec called them "truly dire"; Matthew Sharratt of Bank of America pronounced them "dismal"; "dreadful" was the verdict of Malcolm Barr of JP Morgan.

However, it is developments in economies far away from Britain which have triggered the latest global bout of nerves. Disappointing results from the industrial giants Sony and Toyota helped spark the sell-off in the Far East. Concerns about economies as diverse as Iceland, South Korea, Thailand, Serbia, Hungary, Ukraine, Belarus and Argentina helped build the panic. The world has increasingly relied on emerging economies, principally China, for much of its growth; but now that the Western economies are so patently weak, hopes are also fading that the emerging nations can continue to pull the world along.

Yesterday's events seemed an appropriate way to mark the 79th anniversary of the Great Crash of 1929.

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Bhai Harinder singh ur posts r very inspiring, please continue to write and inspire the sangat.

I remeber reading ur post and u saying that one day we wont even be able to access the internet. Also energy will be down. When do you think this will happen?

Veer, financial crisis and peak oil are 2 different things but are closely linked to each other. Infact I feel peak oil is one of the big factors behind the current financial crisis( people just look at the current low oil prices and feel happy, these people are being fooled).

I personally feel the current financial crisis is going to delay the destruction and anarchy caused by peak oil. Its pretty hard to predict about when the energy will go down. But one thing is sure, access to internet and air travel is going to get tougher and tougher.

Our present economy and lifestyle is extremely complex and interdependent and its tough to predict the exact time when everything falls apart. But it is definately going to fall apart in the future (2 years, 5 years, 8 years, cant say)...

The industrial civilation is going to end.... there is no doubt about it and the sikhs shud try to lessen the bondage of this industrial civilization from nowonwards by

1. eating in sarbloh utensils and avoiding plastic, steel utensils..

2. Get used to walking instead of using cars, bikes all the time.

3. Get ur body in shape(this is very very important).. People who are lazy, fat are going to have very less chance of survival.

4. Above all, japp gurmantar and gurbani all the time and Satguru jee will save us. He will automatically create situtations that will save us from sorrow and pain..

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The real tragedy of this financial crisis is that people will die<

http://www.marketwatch.com/news/story/real...7-E5F8EA18DA75}

Its time for rich sikhs to fellow poor sikhs and infact help fellow humanity. People who are rich shud give more than dasvandh to the Gurdwara. This is the real test of one's bhagti.

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leave it up to the media to exaggerate everything... we will be fine... :)

I am not exaggerating. Whatever I write is based on sound research and reading and logical theories like peak oil.

We are about to face a terrible time and the world population is going to shrink to 1/6th(or even less if there is nuclear war). If ever there was time to chakk amrit and japp Naam, ITS NOW. People who wont japp Naam now, will die like sheeps in the future.

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leave it up to the media to exaggerate everything... we will be fine... :)

I am not exaggerating. Whatever I write is based on sound research and reading and logical theories like peak oil.

We are about to face a terrible time and the world population is going to shrink to 1/6th(or even less if there is nuclear war). If ever there was time to chakk amrit and japp Naam, ITS NOW. People who wont japp Naam now, will die like sheeps in the future.

ur sounding alot like one of those christians..dooms day is comming accept christ as your saviour

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