The Big Reset: America’s Financial System Will Suffer a Horrible Reset By 2014

By SD Contributor AGXIIK:

America will soon suffer a horrible reset. That’s inevitable.
But the people of this country and their unique nature, with the resolve to roll up their sleeves, deal with the reset, and get back on to a sound hard asset backed currency (even if they have to dig it out of the ground with their bare hands) will reestablish a sound economy, like the one embodied in the best elements of the Constitution and Bill of Rights along with the beliefs and morality that existed before the banksters came to rule the land.  The present day currency cargo cult will come to an end.

I have optimism in that. But until we go cold turkey on a century of debt and take the cure, these things will not happen.  The longer we wait, the worse the reset will be.

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If one currency devalues itself into hyperinflation, all debts, foreign and domestic, would suffer either a complete default, with the principal and interest unpaid or the debts would be paid with hard assets such as gold or other commodities.

The difference in how the debts are resolved would be a test of the national character, will of the people, and courage of the political leaders. The people’s will is reflected in how much hardship they can take until they hit the breaking point.

Weimar Germany tried the former by printing its way out of war reparations.  That ended badly and WWII was one of the result.  Political courage is lacking in our country as it is in most. The people’s will is pretty questionable given that over half of the people in this country live almost entirely on government transfer payments.

The problem we face today is that the same problems that beset Germany and the dozens of other countries who went through hyperinflation, is that we now have dozens of countries pursuing the same policies but on a global basis.
What was once a single country reset to normalcy, will be world wide. 

The FIAT empires are designed to enrich some and em-beggar the common folks.  Inflation is the only path these people follow, knowing that inflation removes debt, but the  cost is terrible.  Inflation is insidious and its effects have 4,000 of historical precedence. How to fix its effects are well known.

The historical record is full of countries that printed themselves into penury and after their painful and deadly resets, many countries came back from the dead by creating a gold and silver backed currency. They survived the currency/debt reset because what the system had to deal with was funny money. People will almost always persevere evenif the FIAT does not.
The financial system we had worked well in the US for nearly 150 until the Federal Reserve was founded (with mal intent and a plan to destroy America). Subsequently gold and silver were either stolen from the citizenry or repudiated by the government—see Johnson taking silver from our coins and Nixon taking us off the gold standard.   The stage was then set.

Since then our country has not made even a single step forward in real growth of wages and wealth. While the charts of debt and income went upwards for 40 years, most of us have been stuck in the euphoria of inflation induced pseudo-wealth or, for a few, transformed formerly honorable professions like banking, lawyering and political offices into a dog eat dog hog wallow of moral and financial turpitude.  The coarser elements of human nature forced their ways into the fabric of this country. those who’s lives were devoted to plunder took power from good people.

So, the answer would be, and maybe some good news here, is that America will suffer a horrible reset. That’s inevitable.
But the people of this country and their unique nature, with the resolve to roll up their sleeves, deal with the reset, and get back on to a sound hard asset backed currency (even if they have to dig it out of the ground with their bare hands) will reestablish a sound economy, like the one embodied in the best elements of the Constitution and Bill of Rights along with the beliefs and morality that existed before the banksters came to rule the land.  The present day currency cargo cult will come to an end.

I have optimism in that. But until we go cold turkey on a century of debt and take the cure, these things will not happen.  The longer we wait, the worse will be the reset.

The US economy contracted by .1% in the 4th Q.  We are back into recession, not that we left it.  Anything that you hear from the government and others that we are recovering is  false hope and muddled thinking.   But that is no surprise to regular readers here on SD.  Most of us are living that reality and are prepared as best we can for the reset.

I think that when bond rates go back to their historic norm of 5%, or higher, the bond bubble will rupture. This will remove 25% of the bond values and start the reset.  That might take a while, maybe mid 2013 or into 2014.

 

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