Eat breakfast. Don't listen to fools who can't do math.

Well I agree your tummy is right Rafe.. but your $400 trillion figure is wrong. Lets say give or take a few tens of billions of dollars the US trade deficit is more like $400 Billion and the fiscal deficit is almost as large. Almost all of this is energy and war cost related.

Our current deck of cards economic house was built though the concept of cheep abundant energy... and then exploited through manufactured bubbles by the bankers that control credit. Through it all the banks accumulate economic control via leveraged consolidations to the strictest dictates of capitalism.. while they themselves figure to be immune from the dictates of capitalism, because they self proclaim to be to important to the economy to themselves (banks) fail.

I personally believe the markets are manipulated and in no way reflect the true economic value of the equity share anymore. How can anyone really tell anymore when profit can mean a 1000 different things, banks are heavily engaged in the futures markets private contracts not open to public account.. markets set the price, but people setting the market prices are not buying the actual commodities or shares.. but rather exercisable contracts purchased for pennies on the actual dollar. The end result is a market devoid of any credibility because the banks and the governments have betrayed their responsibilities to regulate a fair market.

How many people honestly think Jimmy Pattison (spl)would be anything near what he is today if the banks didn't finance him and crown him the czar of industry in BC? Thats an extreme example, but I bet even Jimmy himself would attest that the argument has merit.

The end result, mostly of the US Federal Reserve (privately controlled by European bankers) policy that in turn forces Canadian policy as dependent followers, is to have the banksters decide when we will have bull runs and when we will have bear markets... eventually they found with the liberalization of their activities that they could control individual asset class markets to manufacture wealth through appreciation and increase operating revenue through the resulting increase in debt dependence. Just look at Vancouvers real estate market for as good an example as any, but you could also look at energy, real estate in general, the teck bubble, right down to things like corn and rice.

The banksters are running the show all over the place right now and we are not much more then spectators that think we are driving the ship, but in actual reality we have a collective economic fate not much dissimilar to the Queen of the North a few years back. I agree the next recession has high likelihood of being a depression.

In 600AD thereabouts the world suffered a plague that spared no nation on the face of the earth and wiped out entire cities, tribes, and even nations through a coal like boil that developed and killed its victim within days (rich, poor, old, young)... This went on for decades and then went as quickly as it arrived, but in the process all nations experienced collapse and devastation of their economies. I don't think a great depression in modern time would have the specter of a mass extinction like happened then, but the effects to the economies of whole nations I don't think will be that much dissimilar and when that happens its a wild card that no one can predict.

IMO a balance of capitalism that is regulated (trade and capital markets) away from central bank control to the national enfranchisement and protection of the many, and the elimination of industry and banker financing of the political system (including past and present politicians) is essential to ensure we have a chance to not sink down the same sink hole the rest of the world is heading for.

AIMHO

The following paragraph is from a recent article on the Daily Reckoning web site. It is written by Bill Bonner. Bill Bonner was one of the coauthors of the recent book titled "Empire of Debt". I think this paragraph does a good job of explaining the reason for our current economic woes.

"When people spend too much money…when speculators gamble too recklessly…when the government gives out too much cash and credit - there have to be consequences. A free market is not a system designed to give people a free lunch. It's designed to make them better people - by rewarding them when they do the right thing and punishing them when they do the wrong thing. For the last 20 years - at least - people have been doing things that the old economists would have regarded as 'moral failings.' That is, they've been spending more than they make…for example. Now, they've being punished. They're being re-educated. And they're going to end up poorer…but wiser."

I disagree with that statement Charles. I assumes everyone in the market is guilty and thus will receive the same punishment. IMO its not only just the people that did those bad things that will come out the poorer, because when the bubble burst there is always collateral damage.. many just wanted to buy a home, or needed to put fuel in their gas tank, or invested the old fashion way into the stock markets... and it is those people that will be injured the most through no fault of their own other then timing influenced by external forces.

Thats why IMO it should be the banks and their shareholders made to suffer the most, and not bailed out with government subsidization via taxpayer dollars like is the current plan in the US.

"It's designed to make them better people"

Obviously whoever designed it did a lousy job.

Follow the three e's

Engineer - that is the system design

Educate - that is teaching everyone how to properly use it.

Enforce - that is step in and when someone does not follow the system, fine them or take them out of the system.

So, looking at the enforcing part and matching that with the "free" part of the "market", any idiot should realize that there cannot be such a thing as a "free" market.

I think there is a bigger problem over the horizon. That is between Russia and China. Everyone knows how China is growing but have few resources, especially water and oil. They are doing a massive build up of their armed forces. Know in Siberia there is everything China needs. The Russian infrastructure is falling apart and the Russian military is only a shadow of its former self. Money that is being made in Russia is not being reinvesterd, its taken out of the country.

Chinese men are marrying Russian women so there is a low key invasion already going on. This is being resented by Russians and violence against Chinese is climbing.

Now if something where to happen there, it could go nuclear. Some people believe confrontation will happen and not a matter of if but when. One year, ten years. Mainstream media is missing this one.

Now how would that affect the world economies? Be a mess I would think. And I wonder which side the U.S. would take?

This is my zinger for the day.

"The United States has a huge trade deficit approaching $400 TRILLION!"

Accumulated USA trade deficit since 1970 or so is in the order of $6 trillion.

http://www.census.gov/foreign-trade/statistics/historical/gands.txt

Here is a good comparative document for the G7 ...

http://www.budget.gc.ca/2008/plan/ann1-eng.asp

Tidbits .....

1. apparently from 1750-1914 Britain ran a trade deficit .... when Britain ruled the world

2. Rome had persistent trade deficits until the empire dissolved.

3. At the height of their naval power, Athens maintained a persistent trade deficit

Many thoughts and questions can flow from such tidbits ....

For instance, does such economic colonialism promote the well being of those countries which have a trade surplus?

If so, is there also a benefit which flows to the trade deficit nation?

As my father used to say so often back in 1960's ..... don't fear Russia, fear China. And he would continue that train of thought and predict that a major war will not be between the USA and the USSR, but between the USA and USSR (or Russia) as allies fighting against China .....

I think if China wishes to be the next superpower, or get access to the resources they need to feed the new found consumptive society they are building by leaps and bounds, they can do it without major war (possibly local skirmishes to keep things in check) much the same way as other economic colonial powers have done.

And India can follow the same path.

Or is that all just hype?

http://yaleglobal.yale.edu/display.article?id=6407

I'm pretty certain it will never come to war between two nuclear capable nations. In WW2, mankind demonstrated that these weapons WILL be deployed against civilians in war if necessary, and having established this precedent, it is in the interest of ALL parties (including third) to exhaust every inch of possible of diplomacy before engaging war with a nuclear country.

Eagleone. I agree with your comment about my post. The paragraph I quoted does tar everyone with the same brush.

"many just wanted to buy a home" .....

That comes under the term "educate" ...

People should be educated to understand that if it looks to be too good to be true, it likely is.

Why do people believe otherwise typcially. Because of greed. And especially in the USA, where the very constitution of the country promotes the "pursuit of happiness" as one of the objectives of the population. It does not restrict that pursuit to certain conditions.

"In WW2, mankind demonstrated that these weapons WILL be deployed against civilians in war if necessary..."

It was not *mankind* but the US of A which decided to use two nuclear bombs against civilians instead of against Japan's army.

The priorities of the US of A were/are not necessarily the priorities of the rest of mankind.

"It was not *mankind* but the US of A which decided to use two nuclear bombs against civilians instead of against Japan's army."

Yes, and in doing so set the precedent that mankind overall has the capacity to deploy the weapon. If Truman had not ordered the attacks and WW2 had ended differently (presumably with an Allied victory still), the question would always remain, does man have the cojones to ever deploy a nuke in war? The Americans would have had an opportunity to use it to end WW2 and didn't. The USSR would know this and who knows how they would have behaved as a result. As it played out in history, we do know the answer is yes, the nuke will be used in war if push comes to shove-- and so therefore did Khrushchev, Kennedy, Gorbachev, Reagan et al in their respective times, who knew any aggression on either side that led to all out war would be CERTAIN to prompt the use of the bomb. I cannot think of a stronger deterrent to war than the threat of the bomb as a result, nor a more blatant irony over the last century that the epitome of utter destruction has virtually guaranteed everlasting peace among the major powers.

Incidentally to another poster above, the "pursuit of happiness" phrase is in the Declaration of Independence, not the US Constitution.

Great posts guys....

I should add IMO that China knows they will not rival America and the west in naval power for at least 50 years... hence IMO NATO is in Afghanistan to check any land ambitions to the oil fields of Asia... unofficially. The idea that China has one eye on Siberia is not to far removed from the concerns of NATO in Afghanistan, and also why Russia is cooperative with NATO efforts there IMO.

Owl your claim that Rome had trade deficits is flawed. The system of Rome was not similar to the system we use today.

A lot of the Rome trade was tributes for protection and almost all of it was within the Empire itself between the various provinces and kingdoms within the Empire. Romans didn't view themselves as a lowly country or Empire, but rather as the seat of world government. I would find suspect any scholar that made the claim Rome had a trade deficit, because to make that claim a number of assumptions would have to be made that would make any comparisons irrelevant to todays situation of trade between sovereign nations. Wars between competing provinces and generals did far more damage then any trade arrangements the empire had because trade was done with a fixed currency that didn't change in value for hundreds of years until the the Constantinople emperors stared resizing the coins. Rome didn't carry debts to back their currency.

AIMHO

"...that the epitome of utter destruction has virtually guaranteed everlasting peace among the major powers."

Perhaps among the major powers, but the minor powers are determined to create for themselves the nuclear umbrella needed for protection from aggression and bullying from the major powers.

It appears that unless a country is loaded to the hilt with nuclear weapons it gets no respect, especially if one of the major powers decides that it must get its hands on the resources of a minor power, no matter what the legal, ethical or moral obstacles are.

"I cannot think of a stronger deterrent to war than the threat of the bomb as a result,"

Some wars are started intentionally, some by accident. In my view, neither is averted by having such a weapon at hand.

There have been superweapons throughout the history of mankind. Superweapons are a relative notion. Dropping two or three, or 6 or 7 is not going to be the end of the world or humans on the face of it.

In my view, the bomb drop during WWII showed that the world can survive such a weapon. The deterrent of a super weapon is a figment of people's imagination and not founded in reality. The more people think they are a deterrent, the higher the risk that they are not, in my opinion.

Your right Owl... IMO watch Mossad deliver a package to an American city to ensure the US stays in the Middle East... and then the whole concept of deterrent goes out the window and everyone has an edgy trigger finger... The American Joint Chiefs recently flew to Israel to warn them against a 'USS Liberty kind of scenario'... to provoke a war with Iran.

IMO we need to worry about a nuclear false flag operation as the most likely first use and there is only one nation with the 5th column assets in place to carry out that kind of operation... with a motive to do it.