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  • California is broke

    A state that practices massive wellfare handouts, has finally run out of cash, as more and more people moved there to get the goodies and tax take plummets.

    This has been building for many years, it should have been addressed about 10 years ago.

    They were running up a deficit in the good years - how could they cope in the lean years - of course they can't.

    Fitch last week downgraded its rating on California's general obligation debt making it the lowest rating of any U.S. state.

    Going forward, there is speculation, the state's vendors and agencies will be paid with IOU notes - LOL.

    http://www.cnbc.com/id/31677238

    The rest of the USA ain't far behind.

  • China continues to call for SDRs to be new global currency

    The Chinese continue to call for a new global currency not tied to a particular nation.

    The current favuorite would be the IMF's Special Drawing Rights.

    The US Dollar is the current world reserve currency.

    In a dig at the USA:

    "The economic development model of debt-based consumption is most difficult to sustain," the PBOC said.

    Indeed.

    There is clearly angst in China and Russia, but perhaps particularly China because of the vast amount of US Treasuries they hold.

    Will the Dollar Tank??

  • Currency Failure

    When currencies fail - Here's a great article on hyper inflation.

    http://www.mint.com/blog/finance-core/hyperinflation-the-story-of-9-failed-currencies/#comment-32276

    Hyper inflation has occured;

    Weimar Germany: 1922-23
    Hungary: 1945-46
    Chile: 1971-81
    Argentian: 1975-92
    Peru: 1988-91
    Angola: 1991-99
    Yugoslavia: 1992-95
    Belarus: 1994-2002
    Zimbabwe: 2000-2009

    Interesting fact - When Zimbabwe became an independent African state in 1980, the Zimbabwe dollar was actually valued higher than the US dollar, at a rate of 1.25 USD to 1 ZWD ... today (17th June 2009) 1 USD is worth 37,456,777 ZWD.

  • S&P say UK's triple A at risk

    Standard and Poor's did not change the UK's triple-A rating, but said it was at risk without a credible plan to put its debts on a "secure downward trajectory" by the next government.

    S&P said that government debt could reach 100% of GDP by 2013 - a level it said was incompatible, if sustained, with the top credit rating.

    Currently, public debt is 53% of GDP, according to the latest ONS figures.

    One reason it has been changed is the belief by the ratings agency that the government will eventually be liable for costs of between £100bn to £145bn (between 7% and 10% of GDP) for bailing out the banking system - more than double the cost estimated by the Treasury

    Speculation about the future of the UK's AAA has been around for a while now.

    Couple of months ago, ratings agencies mentioned that no one was above review, re: the US.

    I expect more QE, I like gold.

    http://news.bbc.co.uk/1/hi/business/8061019.stm

  • The Door

    In a particularly grotty suburb of east London, there is a high street and on this high street there is a door. It is two doors down from the Wetherspoons, sandwiched between Nationwide and a hardware store. It has broken blue blinds on the inside, most people would never even notice it, even if they walked past it every day.

    It is intentionally low key, for behind the door is an alternate reality.

    It’s 10pm. I go through the door. Today 3 members of the security detail are on reception. I don’t recognize any of them, this is never good. I have my identification and I am on the permanent access list. Still the main security guy insists he can’t let me in.

    “Some kind of irregularity”, he says.

    I ask him to call one of the technical staff.

    The technician comes down. The technicians are an entirely different breed. He “oks” me. And says he’ll wait while I get “signed in”. He stares out through the blue blinds, into the real world. I collect my pass. He seems pensive, I’ve taken him away from his terminal.

    We walk to his office, passing more security in the various corridors. His office is filled with monitors. He is chatty, perhaps his first conversation for some time.

    I go into our area, the doors have steel plates bolted onto them. There is a warning, “if the alarm sounds you have 30 seconds to evacuate this area, after which the doors will be automatically sealed” – it says something else about gas being pumped into the room, I try not to think about this.

    I do my work quickly and leave.

    I exit the door.

    Outside a bunch of hoodies walk past and a girl appears to be puking outside Wetherspoons. I am back in the real world.

    It’s 10pm and I have been working straight for 16 hours.

  • BAYER knowingly sold HIV infected meds

    Watch the video – outrageous.

    This story seems to have come to light some time ago. I missed it. In case you missed it, I’m posting the video.

  • Swine Flu

    pig

  • Deflation - really?

    I don't believe it - Inflation ahead.

  • G20 - SDRs new global currency

    There’s something interesting in the full G20 statement:

    19. We have agreed to support a general SDR allocation which will inject $250 billion into the world economy and increase global liquidity, and urgent ratification of the Fourth Amendment.

    Interestingly $250B is exactly what George Soros called for called for on the 31st March. Note that he is one of Obama’s main backers.
    link

    GS also said:
    "I do not think America is ready to have the dollar replaced by SDRs as the international reserve currency," he said, but added: "In the long term it is something that may come in consideration and in the long term it may be in America's interest."

    The ground work for that is now laid, that’s the curious reference to the 4th amendment.

    The reference to ratifying the Fourth Amendment (of the IMF Articles of Agreement) means that Obama has agreed that the U.S. will vote to greatly expand the use of SDRs. They have always resisted this.

    SDRs are the candidate to replace the Dollar as the global reserve currency.

  • USA - Environmental Technology Leader

    Cast your mind back 2 years or so.

    The USA was the Environmental Villain.

    Europe was the hero - spouting the usual nonsense: "We'll just have to cut back to a simpler lifestyle, bla bla bla..."

    I mentioned at the time that the USA was going to make the greatest contribution, not by cutting back, but by technology.

    Here we are - One step closer to limitless clean energy.

    http://news.bbc.co.uk/1/hi/sci/tech/7972865.stm

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