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Debt

After Greece, Will Italy be Next?

fall-of-rome The capital of Italy is said to be on the verge of collapse. Spain or Portugal may go first, but this story in the Telegraph about the situation in Rome makes me wonder if Italy is going to be next to follow Greece despite the competition for that “honor”: “Rome is on the verge of collapse and needs urgent repair, leaders warn.” The Eternal City is facing crisis, with its administration engulfed in corruption scandals and debt, its roads scarred by pot-holes, the main airport partially Read more [...] Continue reading →

Venezuela Hyperinflation: This Is Where Socialism Goes, and So Do We

crash and burn cash Both Greece and Venezuela show us slightly different versions of the future we are being led into, but no one tries to stop it. I think the most frustrating thing about what is going on in the world right now is that we are all simply accepting that there is no other path we can travel. We are just standing in a single line to a very unpleasant crisis, with no thought of breaking out of it. Our only comfort is that other nations are ahead of us in line. That doesn’t help unless we use the Read more [...] Continue reading →

CBO Admits There is No Way to Predict U.S. Financial Crisis

fiscal cliff_02 Since I posted yesterday about one cause of our impending financial crisis, here’s another issue mentioned by the Congressional Budget Office. I have written about how using fantasy figures as the basis for pensions is sending us into a financial crisis, but there are other problems as well. Even the Congressional Budget Office is admitting to the seriousness of our situation. CNS News reports, “CBO: Debt Headed to 103% of GDP; Level Seen Only in WWII; 'No Way to Predict Whether or When' Read more [...] Continue reading →

Fake Success: Fake Schools in Afghanistan, Courtesy of the U.S. Government

burning money The schools in Afghanistan that our government claims to have built and run… don’t exist. There is one major school that still kind of exists that was reported to be a wild success. It did start well. Nearly four years later, water seeps through the leaky roof and drips onto students in this more than $250,000 construction. Doors are cut in half; some are missing altogether. There is no running water for the approximately 200 boys — and zero girls — who attend. But the school did enrich Read more [...] Continue reading →

Insight into How We Are Turning into Greece

Debt Hits the Fan In order to turn a town, city, state, or nation into Greece, you just need obscure terminology and plausible deniability. The New York Time’s Dealbook blog has a great recent post: “Bad Math and a Coming Public Pension Crisis.” The thing to remember when you read the post is that someone could have reported this five years ago or ten years ago. It could have been an above-the-fold headline instead of a blog post. It could have been a series of stories. But no one at the Times wants Read more [...] Continue reading →

Study: Student Loans Raise Tuition Prices

student loan bubble If you think government-subsidized student loans are to help students, you are confused. Awhile back I wrote on another topic: Here is a phrase I suggest you memorize for future political analysis: “The purpose of NASA is not to explore Mars but the purpose of Mars is to fund NASA.” Whenever you wonder why something like public education or welfare doesn’t work, just repeat that slogan to yourself. It will allow you to understand two things: You are reading the “plan” backwards. Everything Read more [...] Continue reading →

China Collapse Worse than Greece?

stock market crash Australia media is reporting on a China collapse that might be “monstrous.” An Australian news outlet is reporting, “Chinese chaos worse than Greece.” WHILE the world worries about Greece, there’s an even bigger problem closer to home: China. A stock market crash there has seen $3.2 trillion wiped from the value of Chinese shares in just three weeks, triggering an emergency response from the government and warnings of “monstrous” public disorder. And the effects for Australia Read more [...] Continue reading →

The IMF Has Arranged Financial Doom for the EU

euro house The financial doom will be when every insolvent nation demands the same bailouts that Greece is getting, even though they are too big to bail. “Tyler Durden” at Zero Hedge asks, “Did The IMF Just Open Pandora's Box?” By now it should be clear to all that the only reason why Germany has been so steadfast in its negotiating stance with Greece is because it knows very well that if it concedes to a public debt reduction (as opposed to haircut on debt held mostly by private entities such as Read more [...] Continue reading →

Greece: Being a "Developed Nation" Doesn't Matter

eu greece I wouldn’t have noticed this story in USA Today about Greece, except that Drudge linked to it with the following headline: “First developed nation to default on international obligations...” I did not find that line in the story. But I did find the following paragraph: After the deadline passed (at 6 pm ET), Greece joined Zimbabwe, Sudan and Somalia in being in arrears to the IMF. Fitch Ratings has downgraded Greece's government debt further into junk territory. There is no exceptionalism, Read more [...] Continue reading →

Greek Debt Implosion Starting to Ripple Outward

Crashing Europe Graphic The Greek debt crisis is affecting global markets; things are just getting started. It seems like the event that Bob Allen has often warned us about is finally beginning. The New York Times reported yesterday, “Greece’s Debt Crisis Sends Stocks Falling Around the Globe.” Global markets shuddered on Monday after Greece closed its banks amid fears that the country was headed toward default. Stocks slumped on Wall Street, after markets in Europe were buffeted by worries that the Greek debt Read more [...] Continue reading →

Puerto Rico Is Our Greece and More Fallout Is Coming

money swirl Puerto Rico has AT LEAST $73 Billion in debt and they can’t pay it back. Puerto Rico has economic disadvantages. Energy prices are high and there are other challenges. So what did Congress do? Congress made Puerto Rican bonds available completely tax free. This should have caused an immediate alarm to investors. After all, if Congress is doing special favors to make bonds look attractive, then that must mean that Puerto Rican bonds are otherwise unattractive. In many cases reducing taxes Read more [...] Continue reading →

Greece Leaving Should Surprise No One

greece protesting With the possibility of Greece leaving the West finally being acknowledged, we ought to also acknowledge that it was predictable. Here is a headline from the Financial Times: “Washington fears losing Greece to Moscow.” Throughout the prolonged showdown between Greece and its creditors, the Obama administration has largely sat on the sidelines, issuing the occasional warning about the potential economic impact of a default. But with Greece now on the verge of bankruptcy, the US is also beginning Read more [...] Continue reading →