America will remain a strong power militarily and economically but our days are numbered as the sole superpower! The U.S. dollar will remain viable but will no longer be the world's reserve currency!

 World’s

Money Moves East

Rickards Drops Bombshell

On Aug. 22, about 2½ months from today, the most significant development in international finance since 1971 will be unveiled.

It involves the rollout of a major new currency that could weaken the role of the dollar in global payments and ultimately displace the U.S. dollar as the leading payment currency and reserve currency.

It could happen in just a few years.

The process by which this will happen is unprecedented, and the world is unprepared for this geopolitical shock wave.

This monetary shock will be delivered by a group called the BRICS.

The acronym BRICS stands for Brazil, Russia, India, China and South Africa.

This play for global reserve currency status by the BRICS will affect world trade, direct foreign investment and investor portfolios in dramatic and unforeseen ways.

The most important development in the BRICS system concerns the expansion of BRICS membership. This has led to the informal adoption of the name BRICS+ for the expanded organization.

There are currently eight nations that have formally applied for membership and 17 others that have expressed interest in joining. The eight formal applicants are: Algeria, Argentina, Bahrain, Egypt, Indonesia, Iran, Saudi Arabia and the United Arab Emirates.

The 17 countries that have expressed interest are: Afghanistan, Bangladesh, Belarus, Kazakhstan, Mexico, Nicaragua, Nigeria, Pakistan, Senegal, Sudan, Syria, Thailand, Tunisia, Turkey, Uruguay, Venezuela and Zimbabwe.

DYI Comment:  Just pull out a world map and take a look at the three main principal players of the European-Asia heartland; Russia, China, and India.  Over time and this is happening now the secondary countries will come under this new system.  Again looking at your world map starting at St. Petersburg Russia moving south by south east:

Belarus

Russian portion of Ukraine - [soon to be decided]

Azerbaijan - Armenia - Georgia

Kazakhstan - Kyrgyzstan - Uzbekistan - Turkmenistan - Tajikistan 

Iran

Afghanistan - Pakistan 

India and Sri Lanka

Nepal - Bhutan - Bangladesh - Myanmar (Burma)

Mongolia and China

Vietnam - Laos - Thailand - Cambodia

Brazil and South Africa are only icing on the cake.  The above countries is a massive land mass and population base.  Most importantly as you move into the interior U.S. aircraft carriers become ineffective.

Back to the article:

There’s more to this list than just increasing the headcount at future BRICS meetings.

If Saudi Arabia and Russia are both members, you have two of the three largest energy producers in the world under one tent (the U.S. is the other member of the energy Big Three).

If Russia, China, Brazil and India are all members, you have four of the seven largest countries in the world measured by landmass possessing 30% of the Earth’s dry surface and related natural resources.

Almost 50% of the world’s wheat and rice production as well as 15% of the world’s gold reserves are in the BRICS.

Meanwhile, China, India, Brazil and Russia are four of the nine highest-population countries on the planet with a combined population of 3.2 billion people or 40% of the Earth’s population.

China, India, Brazil, Russia and Saudi Arabia have a combined GDP of $29 trillion or 28% of nominal global GDP. If one uses purchasing power parity to measure GDP, then the BRICS share is over 54%. Russia and China have two of the three largest nuclear arsenals in the world (the other leader is the United States).

By every measure — population, landmass, energy output, GDP, food output and nuclear weapons — BRICS is not just another multilateral debating society. They are a substantial and credible alternative to Western hegemony.

BRICS acting together is one pole of a new multipolar or even bipolar world.

When the new currency launch is announced in August, the currency will not fall on an empty field. It will fall into a sophisticated network of capital and communications. This network will greatly enhance its chances of success.

The BRICS are also developing an optical fiber submarine telecommunications system that would connect its members. It is being developed under the name BRICS Cable. Part of the motivation for BRICS Cable is to foil spying by the U.S. National Security Agency on message traffic carried through existing cable networks.

What’s behind this quest to ditch the dollar? In no small part the answer is U.S. weaponization of the dollar through the use of sanctions.

On numerous occasions from 2007–2014, I warned U.S. officials from the Treasury, Pentagon and intelligence community that overuse or abuse of dollar sanctions would lead adversaries to abandon the dollar to avoid the impact of sanctions.

Such abandonment would lead to the diluted potency of sanctions, unforeseen costs imposed on the U.S. and eventually to the collapse of confidence in the dollar itself. These warnings were mostly ignored.

We have now reached the first and second stages of this forecast and are dangerously close to the third.

For years, the U.S. has used sanctions to punish nations like Iran. But the sanctions the U.S. and its allies imposed on Russia after it invaded Ukraine last year went far beyond previous sanctions regimes. They were unprecedented.

Many other nations began to conclude that they could be next if they run afoul of the U.S. on certain issues. And that fear has greatly accelerated the push to opt out of the dollar system entirely.

This desire is not limited to current targets such as Russia but is shared by potential targets including China, Iran, Turkey, Saudi Arabia, Argentina and many others.

The BRICS+ present a realistic effort to de-dollarize global payments and eventually global reserves.

For years, I’ve argued that the dollar would remain the world’s leading reserve currency for longer than most people think.

But below, I show you why a new BRICS+ currency could greatly accelerate the demise of the dollar as the world’s leading reserve currency.

How could it happen so much faster than I previously thought? Read on.

---

The Coming Shock to the Global Monetary System

By Jim Rickards

The global desire to move away from the dollar as a medium of exchange for international trade in goods and services is hardly new. The difference today is that it’s gone from a discussion point to a novelty to a looming reality in a remarkably short period of time.

Dubai and China have recently concluded an arrangement whereby Dubai will accept Chinese yuan in payment for oil exports from Dubai. In turn, Dubai can use the yuan to buy semiconductors or manufactured goods from China.

Saudi Arabia and China have been discussing similar oil-for-yuan arrangements but nothing definitive has yet been put in place. These discussions are made complicated by Saudi Arabia’s long-standing petrodollar deal with the U.S. Still, some progress along these lines is widely expected.

China and Brazil have recently reached a broad-based bilateral currency deal where each country accepts the currency of the other in trade. Meanwhile, there’s a growing strategic relationship between China and Russia as the two superpowers jointly confront the United States. In the trading relationship between the two nations, Russia can pay in rubles for Chinese manufactured goods and other exports while China pays in yuan for Russian energy, strategic metals and weapons systems.

Yet all these arrangements may soon be superseded by a new BRICS+ currency, which will be announced in Durban, South Africa, at the annual BRICS Leaders’ Summit Conference on Aug. 22–24.

The currency will be pegged to a basket of commodities for use in trade among members. Initially, the BRICS+ commodity basket would include oil, wheat, copper and other essential goods traded globally in specified quantities.

In all likelihood, the new BRICS+ currency would not be available in the form of paper notes for use in everyday transactions. It would be a digital currency on a permissioned ledger maintained by a new BRICS+ financial institution with encrypted message traffic to record payments due or owing by participating parties. (This is not a cryptocurrency because it is not decentralized, not maintained on a blockchain and not open to all parties without approval.)

The latest information from the BRICS working groups is that this basket valuation methodology is encountering the same problems that John Maynard Keynes encountered at the Bretton Woods meetings in 1944.

Keynes initially suggested a basket of commodities approach for a world currency he called the bancor. The difficulty is that global commodities included in any basket are not entirely fungible (there are over 70 grades of crude oil distinguished by viscosity and sulfur content among other attributes).

In the end, Keynes saw that a basket of commodities is not necessary and that a single commodity — gold — would better serve the purpose of anchoring a currency for reasons of convenience and uniformity.

Based on the impracticality of commodity baskets as uniform stores of value, it appears likely that the new BRICS+ currency will be linked to a weight of gold.

This plays to the strengths of BRICS members Russia and China, who are the two largest gold producers in the world and are ranked sixth and seventh respectively among the 100 nations with gold reserves.

These and related developments are frequently touted as the “end of the dollar as a reserve currency.” Such comments reveal a lack of understanding as to how the international monetary and currency systems actually work.

The key mistake in almost all such analyses is a failure to distinguish between the respective roles of a payment currency and a reserve currency. Payment currencies are used in trade for goods and services. Nations can trade in whatever payment currency they want — it doesn’t have to be dollars.

Reserve currencies (so-called) are different. They’re essentially the savings accounts of sovereign nations that have earned them through trade surpluses. These balances are not held in currency form but in the form of securities.

When analysts say the dollar is the leading reserve currency, what they actually mean is that countries hold their reserves in securities denominated in a specific currency. For 60% of global reserves, those holdings are U.S. Treasury securities denominated in dollars. The reserves are not actually in dollars; they’re in securities.

As a result, you cannot be a reserve currency without a large, well-developed sovereign bond market. No country in the world comes close to the U.S. Treasury market in terms of size, variety of maturities, liquidity, settlement, derivatives and other necessary features.

So the real impediment to another currency as a reserve currency is the absence of a bond market where reserves are actually invested. That’s why it’s so difficult to displace Treasuries as reserve assets even if you wanted. Again, no country in the world can come close to the U.S. in that regard.

But here’s where it gets interesting, and why the dollar could lose its leading reserve status much faster than previously thought.

That’s because the BRICS+ currency offers the opportunity to leapfrog the Treasury market and create a deep, liquid bond market that could challenge Treasuries on the world stage almost from thin air.

The key is to create a BRICS+ currency bond market in 20 or more countries at once, relying on retail investors in each country to buy the bonds.

The BRICS+ bonds would be offered through banks and postal offices and other retail outlets. They would be denominated in BRICS+ currency but investors could purchase them in local currency at market-based exchange rates.

Since the currency is gold backed it would offer an attractive store of value compared with inflation- or default-prone local instruments in countries like Brazil or Argentina. The Chinese in particular would find such investments attractive since they are largely banned from foreign markets and are overinvested in real estate and domestic stocks.

It will take time for such a market to appeal to institutional investors, but the sheer volume of retail investing in BRICS+-denominated instruments in India, China, Brazil and Russia and other countries at the same time could absorb surpluses generated through world trade in the BRICS+ currency.

In short, the way to create an instant reserve currency is to create an instant bond market using your own citizens as willing buyers.

The U.S. did something similar in 1917. From 1790–1917, the U.S. bond market was for professionals only. There was no retail market. That changed during World War I when Woodrow Wilson authorized Liberty Bonds to help finance the war.

There were bond rallies and Liberty Bond parades in every major city. It became a patriotic duty to buy Liberty Bonds. The effort worked, and it also transformed finance. It was the beginning of a world where everyday Americans began to buy stocks, bonds and securities as retail investors.

If the BRICS+ use a kind of Liberty Bond patriotic model, they may well be able to create international reserve assets denominated in the BRICS+ currency even in the absence of developed market support.

This entire turn of events — introduction of a new gold-backed currency, rapid adoption as a payment currency and gradual use as a reserve asset currency — will begin on Aug. 22, 2023, after years of development.

Except for direct participants, the world has mostly ignored this prospect. The result will be an upheaval of the international monetary system coming in a matter of weeks.

Multi-Decade Geopolitical economic money flowing from western countries to Russia, India, China and all minor countries within their spear of influence.

 

Money

Moves East!

So, Michael, I want to ask you, what is your analysis on the current state of the US economy?

 Michael Hudson:  It looks very bad. It never really recovered from the Obama depression that begun in 2009 when the banks were bailed out and all of the debts were kept on the books. 

The debt has been growing very rapidly because of the Federal Reserve’s 14 years of zero interest rates that flooded the economy with money, which means debt, to try to prop up the stock market and the real estate market. The debt has grown much higher than it was way back in 2008, when you had the junk mortgage crisis. 

The arrears and defaults are rising for student loans, for automobile loans, for credit card loans. Commercial property is not only defaulting, but large companies are simply walking away from their office buildings.

Many banks are in the same position that Silicon Valley Bank was in. There’s almost a negative equity because the mortgage holdings and their long-term bond holdings market value has gone way down below what they owe their depositors.

There is no way that it can restore its industry unless it writes down the enormous amount of debt and housing prices and medical insurance that the American wage earner asked to make.

Just imagine this. If you were to give wage earners everything they buy at the stores for nothing, give them all the food, all the clothing, all of the transportation, everything they need. They still couldn’t compete with foreign workers because they have to pay so much money on debt service, on housing, which takes between 30 and 40% of their income. They have to have medical care. That’s 18% of America’s GDP, higher than any other country. 

So the money that is paid to the financial, insurance and real estate sector in America is so large that there’s no way that America can be competitive with other countries. So, what the Biden administration is trying to do is saying, “Well, okay, I understand that we can’t compete on prices. I understand that our labor cannot compete with foreign labor anywhere near it, but if we can militarily tell everybody not to go China, Russia, India, Asia and other countries what they need to make wafers, chips, and information technology, then they’ll have to buy everything here from high cost. We can charge monopoly prices and our prices will be so high that we can basically impoverish the rest of the world by controlling everything that they really need to work. We can control their energy, we can control their oil, we can control their computers by sanctions against China, Russia, Iran, Venezuela, any country that does not agree to let us control their economy and buy control of it.” 

Any country that doesn’t agree to let America produce all of the monopoly goods that are most profitable, will be treated like we’ve treated Ukraine.” 

..But what I’m hearing from you is that for the United States sanctions has not only become a political tool, but an economic necessity as well.

Hudson: Well, that’s what the sanctions are. They’re intended to be an economic tool of coercion. Sanctions are a form of coercion, saying, “If you can depend on us for your food, for your oil, and we can turn off your oil, then you’ll be freezing in the dark. If we can block food to you, then you can’t afford to eat. If we can get you high enough and debt to us that all of your export surplus has to go to paying the money that the IMF and the World Bank and other foreigners have lent you, then you’re totally dependent on [us].” And that’s what America’s strategy is — to make other countries dependent on it so that they don’t have a choice...

Oh, sanctions have been very, very effective, but I think you’ve got the players wrong. The sanctions were against Europe, not against Russia.

The United States calculated two years ago that it cannot compete with Eurasia. It’s losing. It knows that it’s lost the long-term fight for not only dominance, but the long-term fight to be a major player. 

So it says, “What can we do? We know that we cannot compete with Eurasia, with China, Russia, Iran and the rest, but the one thing we can do is [to] lock in American prosperity by making Western Europe and the English speaking countries, Australia and New Zealand, completely dependent on us.” 

Do you expect the debt ceiling deal to help stabilize the American economy or will it only make things worse in the long-run?

The intention was to make things worse. There was never any debt crisis at all. The government could have simply continued to pay its bills for projects that Congress had already approved. There is no way that the government was going to default on its Treasury debt because, after all, the Treasury debt is held by the wealthiest 10% and the government is not going to do anything that hurts the 10% and benefits the 90%... We have to vastly increase the military budget and because we’ve agreed on a spending limit, we’ve got to cut back the social programs that we’ve just cut back, and cut them back even more.” 

So, what you’re seeing is right now the class war is back in business in the United States. This is class war with a vengeance. You’re seeing labor being squeezed. Local city and urban budgets are being squeezed throughout the country. That’s one of the big problems, the budgetary squeeze. You’re having the banks being squeezed by the defaults on commercial real estate that they’re exposed to, and the rising defaults on the personal debts that I mentioned before that they’re exposed to. 

So, the economy is really in trouble...

..That’s right. It’s all just a made up. When they talk about cutting back the government debt, what they mean is cutting back social services. They would like to do what Biden and Obama wanted to do after 2009. They want to cut back Social Security...

But how much longer can the US just keep printing money in order to service this government deficits? Is this really sustainable indefinitely?

Well, what usually stops a situation like that is a political revolution. The answer is it’s sustainable until people fight back, until there is a revolution. But as long as you have a political system where you have only two parties that are really the same party, and as long as you have the Democrats as the only alternative to the Republican Party...

And why is financialization of the economy a bad thing? ... What’s the problem with that sort of model? Why can’t the United States just have an economy that’s built mostly on white collar professionals and offices?

Finance is really not part of the economy. There are two economies in every country. You have the production and consumption economy, which often people call the ‘real economy’, making things and selling them and using them, and you have the financial sector that provides credit for this. The financial sector lives in the short run... So, there’s a confusion about whether you are going to think of the economy as Wall Street and making money on stocks and bonds and lending money to real estate, or are you going to think of an economy employing workers and rising living standards, that kind of growth?

So, the people who are making the loans and the new absentee real estate companies are getting rich. But when housing prices go up, that means that wage earners have to pay higher and higher proportions of their wages to pay their rent and to take out a mortgage and buy their house.

 As more and more personal income is spent on housing or medical care or retirement pension income, then they’re going to have less and less to spend on goods and services.

If you say “forget goods and services, we’ll have China and Asia and the foreigners produce them,” then all you really have is a hollowed out, empty economy... Well, 

If that’s your equilibrium, the debts can only be paid, as they grow exponentially, by consuming less and less, by living standards going down and down, by real wages going down and down.

Social services being cut back more and more, by Social Security and Medicare being cut back more and more. 

That’s the program: 

Both American political parties!

What is your assessment of the current state of the US dollar?  What’s going on here? Why are so many countries looking for options to dump the dollar?

Well, for the last year and a half, America has said, “if other countries hold their dollars and European banks or American banks and they do something that we don’t like, we have a right to grab all of their dollars and simply take them”

In order to make an alternative currency beyond merely holding each other’s currency, you would have to have an alternative to the International Monetary Fund. And that’s what Lula was talking about when he went to Asia. How do we make a common a common alternative bank? Well, the problem with an alternative bank is [that] you need its members to agree on who gets the credits... The kind of special money that this bank would create isn’t the kind of money that you spend at the grocery store. It’s not money that would spend domestically. 

It’s money to do what gold does. And that is only subtle balance of payments deficits among central banks. 

That’s what gold is now.

Before you had the dollar standard or Treasury bills standard in 1971, when countries would run a balance of payments deficit, they’d have to pay in gold. So every month during the Vietnam War, the soldiers and the army would spend money in Vietnam, in Southeast Asia, that used to be part of the French colonial empire. The banks were mainly French. The banks would send the dollars that were spent to the central bank in Paris. 

And General de Gaulle would take these dollars and would say, okay, here are the dollars we have. Give us your gold at $35 an ounce. And that was how America’s gold stock was going way down.

And all of a sudden, if the United States is unable to have other people keep their savings in dollars, meaning buying Treasury securities, then how are they going to pay the international balance of payments cost of their military spending? They won’t be able to spend militarily abroad. The only way they can do it is drastically cut back imports in the America. And to do that, you have to cut wage rates by 20%. You have to make the American labor force the poorest labor force in the West so that all of the balance of payments, money that’s spent, is not on buying goods and services to consume, but only for military spending.

[re: opinions of] Paul Krugman in The New York Times and other mainstream outlets is that although there is some incentive for countries to move away from the dollar, there isn’t really a viable alternative at the moment, and that the countries of BRICS that, although they may have a common interest in forming a BRICS currency, an alternative to the dollar, these economies are too different too varied in order to be able to join forces and form their own alternative currency.

Well, let’s look at what happened with Colonel Gaddafi, the head of Libya. Gaddafi said we want a gold based currency for Africa. And so instead of holding dollars, he bought gold. So NATO bombed the country to smithereens, caught Colonel Gaddafi, tortured him to death and grabbed the gold from the central bank and nobody knows where it disappeared to. 

But it seems to have disappeared into the State Department to play dirty tricks throughout the world. So Krugman advocates militarily forcing and destroying any country that wants an alternative to the dollar. He’s a hawk and basically says, “do it by force”. And in his notorious article in The New York Times, he said, “Well, everybody is so used to dealing the dollar, they can’t find an alternative.” 

Well, most of my books are all about how to make an alternative to the dollar and the interviews that I’m doing, and my colleagues and I are spending our full time writing. We write for the Valdai Club in Russia. I write for the Chinese Academy of Social Sciences. 

We’re writing for other countries to help create an alternative to the dollar because we don’t want to see the world militarized in the way that the US is militarizing it. We want to see a resumption of the economic potential that the world seemed to have leading up to World War One before the whole economy got derailed a century ago...

..But throughout history, the creditors, people who do not work for a living, who are simply inherit their money or have their money by exploiting people, are willing to [hire others to kill] for this right to [own] other people. But people actually produce the wealth. The victims are much less willing to fight militarily or by violence. And the first thing that creditors, the ruling class, do is to have a monopoly of violence.

You had assassinations every single century in Rome. The advocates of debt cancellation and redistribution of land were assassinated. That’s what you seem to be facing in the United States, just as the United States has been assassinating foreign leaders for the last 75 years. African leaders, Latin American leaders, Pinochet, the man coming in and assassinating Allende. The same thing happened in Africa. Same thing has happened throughout the Near East with Gadhafi. 

As long as you have America saying, “We know the secret to economic stability, it’s assassinating everybody who disagrees with us and who wants independence from the United States.”

As long as other countries said, “Yes, that’s what democracy is, we’re for the United States,” then they’re committing suicide and then their leaders will be killed again and again and again. 

That’s how the world economy is keeping equilibrium today. It’s an equilibrium trying to subject the entire world to the Dark age into which Roman Empire itself declined.

https://www.nakedcapitalism.com/2023/06/michael-hudson-on-the-us-economy-surprisingly-resilient-or-potemkin-village.html

 

By Patrick J. McShay

This is happening in our country every single day.

You might live in a police state if…

*You might live in a police state if the FBI visits your home about your peaceful protests against abortion.

*You might live in a police state if the Director of the National Institute of Health predicts a pandemic 3 years before it happens and you find out it was all planned by your country’s Department of Defense.

*You might live in a police state if the outgoing president and leaders of his party conspire with the Premier law enforcement agencies, the FBI, the CIA, the NSA, and the Department of Justice to spy on the leading candidate of the opposition party to plot and lead a coup against him, and impeach him based on lies, get caught red-handed. and no one gets in trouble.

*You might live in a police state if the party that pledged unity installs racist and divisive policies that target nearly 70% of the population.

 *You might live in a police state if the party that talks about freedom and democracy openly works to destroy both.

*You might live in a police state if the president pledges to never mandate experimental and dangerous mRNA vaccines and then mandates those vaccines.

*You might live in a police state if the party in power says meat is bad, calls for farmers to stop growing food, and then starts telling us how tasty bugs are.

*You might live in a police state if they work to release violent felons from prison and arrest heroes who are stopping crime.

*You might live in a police state if the president is a dementia patient and dual Israeli citizens are running the country.

*You might live in a police state if the president praises Transsexuals and Homosexuals and demonizes Christians and veterans.

*You might live in a police state if DNA contamination and the cancer-causing agent SV40 are found in mRNA vaccines you are forced to take

*You might live in a police state if children under 18 needs a letter of consent from their parents to go on a school trip to the zoo, but no permission is needed to give a child a dangerous vaccine or be sexually groomed by their non-binary teacher.

*You might live in a police state if Drag Queen shows for kids are held on your country’s military bases.

*You might live in a police state if 12 cops wrestle you to the ground for carrying a gun when you possess a legal carry permit!

*You might live in a police state if you’re a 6-time Super Bowl winner in a park near his house when a nosy cop tells you to go home or face arrest.

*You might live in a police state if they start letting felons out of prison and start arresting law-abiding tax-paying citizens for not properly social distancing.

*You might live in a Police State if a presidential candidate is credibly accused of sexual assault and the majority of the media won’t even cover it!

*You might live in a police state if a crazy billionaire sinks billions of dollars into the murky, corrupt pharmaceutical business and plots to implant a “Mark of the Beast”-like microchip into everyone on the planet to track and enslave them and everyone seems okay with it.

*You might live in a police state if the same creepy billionaire goes from creating back doors for computer viruses to engineering back doors for coronaviruses.

*You might live in a police state if the Governor issues an order that forbids you to cut your grass.

*You might live in a police state if your Governor okays the use of kayaks and canoes but forbids the use of ski boats and jet skis.

*You might live in a police state if you find out the pandemic that ruined your life was planned by billionaire Bill Gates because he was bored and needed something to do after he left Microsoft… (and he really does hate useless eaters).

*You might live in a police state if the Government moves ahead to approve 5G, a bio-weapon, despite the objections of doctors, scientists, and other professionals horrified and vehement objections!

*You might live in a police state if a dozen cops wrestle and drag a man out of a city bus, throw him to the ground, and handcuff him for not wearing a face mask.

*You might live in a police state if a cabal of powerful men from the previous presidential administration is caught spying on the future President and cabinet members during and after the election, and when they get caught no one goes to jail and most of the media refuse to cover it anyway.

*You might live in a police state if the billionaire that bribed politicians and health officials to mandate vaccines for you and your kids refuses to vaccinate his own kids.

*You might be living in a police state if your Department of Agriculture lets millions of pounds of food rot while demand at food banks soars and people are going hungry.

*You might be living in a police state if your military is deployed to your nation’s food banks to ensure stability during a contrived crisis.

*You might be living in a police state if the illegal aliens that just got here are getting more government assistance than your monthly Social Security check after working for 40 years.

*You might be living in a police state if your national police agency (FBI) plots with your Justice Dept. to set up and entrap the new President’s National Security Advisor and he is under criminal investigation!

*You might be living in a police state if, during a contrived pandemic, corporations start running creepy dystopian and sappy commercials warning you to stay inside, wash your hands, be safe, and again don’t forget to wash your hands!

*You might be living in a police state if they pretend to be a model of democracy to the rest of the world while illegally spying on their citizens, politicians, and judges.

*You might be living in a police state if corporate fat cats write your laws and control your politicians through lobbying and excessive contributions.

*You might live in a police state if there has been a 4000% increase in “No Knock” military armed SWAT Team raids in the last 30 years.

*You might be living in a police state if your police departments are using military tactics and weapons against your citizens.

*You might be living in a police state if the police make it a policy to shoot family dogs who aren’t threatening in any way! (A common practice by American police departments)

*You might be living in a police state if your country has 5% of the world’s population and 25% of the world’s prison population.

*You might live in a police state if your National Security Agency gathers nearly 5 billion records every day tracking the smartphone locations of its citizens.

*You might live in a police state if your National Security Agency intercepts computer shipments to plant spyware on new systems.

*You might live in a police state if persistent public apathy allows corrupt unelected officials and corrupt politicians to throw the country into lockdown and enact police-state measures based on lies!

*You might live in a police state if politically correct fascism has trumped your right to free speech and expression.

*You might live in a police state if children as young as 6 are arrested at school for throwing tantrums and other minor offenses.

*You might be living in a police state if your police department isn’t as interested in protecting and serving as they are in beating, tasing, and arresting your citizens.

*You might live in a police state if the police steal more cash and personal property from its citizens through asset forfeiture in a year than they lose to burglars.

*You might live in a police state if your policemen tend to shoot first and ask questions later.

*You might live in a police state if your police department spies on law-abiding citizens using aerial surveillance and facial recognition software.

*You might live in a police state if your government’s intelligence agencies and military perform grisly and horrific experiments on citizens and soldiers they regard as little more than lab rats.

*You might live in a police state if 17,000 police departments are using military issue equipment.

*You might live in a police state if 80% of asset forfeiture cases result in no charges against the homeowner!

*You might live in a police state if your government allows the collection of trillions of your citizen’s phone calls, emails, videos, and social media posts, and the Supreme Court okays the government’s collection of your DNA for future “Minority Report” type experiments to further invade your privacy.

*You might live in a police state if, over the objection of parents, your child’s school announces that new sex education classes will include graphic discussions of homosexuality, lesbianism, anal sex, and the use of sex toys to be taught to children as young as 5-years-old.

*You might live in a police state if your local library begins having weekly “Drag Queen Story Hour” encouraging parents to attend and bring their children to hear Drag Queens read to their kids. (Corporate sponsored)

*You might live in a police state if Children who are citizens are forced to get vaccines in order to attend school while illegal students need no vaccines to attend.

It shouldn’t matter what our political affiliation is when it comes to our God-given inalienable rights and law and order, but if any party forgets that we exist in this country on the principle that we have individual liberty to make decisions ourselves, that political party should be abandoned and its members considered traitors to the U.S. Constitution and the Republic.

There is an old expression: “Burning the house down to kill the rats.” Is that what our controllers did to our great country with this phony pandemic? Is China Joe destroying the country for the globalists along with those of us who won’t accept the New World Order’s form of tyranny?

Traitor Joe’s Jewish DHS Director Mayorkis, a dual Israeli citizen, is funding American universities with tax money to BRAINWASH Students Into believing that Christians And Republicans Are ‘Nazis, and has illegally opened the borders to 5 million illegal aliens in just over 2 years. China Joe’s cabinet is filled with Duel Israeli Citizens who HATE White Christians.

The WHO is warning that a new more deadly virus is on the way, meanwhile, Russia Claims They Collected Evidence of Avian Flu Pathogens with Lethality Rate Up to 40% in Humans at US Biolab in [Eastern Europe]. Why are US taxpayers funding dozens of Bio-Labs in [Eastern Europe]? Are they planning the next pandemic?

Kevin McCarthy proved his RINO cred by agreeing to a horrible compromise on Biden’s debt deal. Who does he think he’s fooling? Bad News for Americans: 98% of 87,000 IRS Agents are here to Stay After McCarthy Caves-in to Democrats.

What is going on now has much more to do with power, control, the death of the dollar, and the destruction of our Bill of Rights brought about by Mr. Gates’ engineered pandemic! The economy is a disaster, Traitor Joe Biden is outspending Trump and the Kenyon at a wicked pace, and the weak Republicans don’t have the support to stop him.

Americans are currently experiencing life in a soft police state. If we permanently accept any of these new edicts of control, especially the WHO’s Pandemic Treaty. we will never get our country back! Accept nothing less than the freedoms that our forefathers fought to ensure for their children, grandchildren, and every future generation of Americans.

U.S. stocks remain at nose bleed valuations all maintained by massive fiscal and monetary pump priming. It's all fun and games till someone gets hurt!

 

Updated Monthly

AGGRESSIVE PORTFOLIO - ACTIVE ALLOCATION - 6/1/23

Active Allocation Bands (excluding cash) 0% to 50%

33% - Cash -Short Term Bond Index - VBIRX

49% -Gold- Global Capital Cycles Fund - VGPMX **

 18% -Lt. Bonds- Long Term Bond Index - VBLTX

 0% -Stocks- Total Stock Market Index - VTSAX

[See Disclaimer]

** Vanguard's Global Capital Cycles Fund maintains 25%+ in precious metal equities the remainder are domestic or international companies they believe will perform well during times of world wide stress or economic declines.  

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Margin of Safety!

Central Concept of Investment for the purchase of Common Stocks.

"The danger to investors lies in concentrating their purchases in the upper levels of the market..."

Stocks compared to bonds:

Earnings Yield Coverage Ratio - [EYC Ratio]

Lump Sum any amount greater than yearly salary.

PE10  .........29.97
Bond Rate...4.97%

EYC Ratio = 1/PE10 x 100 x 1.1 / Bond Rate

1.75 plus: Safe for large lump sums & DCA

1.30 Plus: Safe for DCA

1.29 or less: Mid-Point - Hold stocks and purchase bonds.

1.00 or less: Sell stocks - Purchase Bonds

Current EYC Ratio: 0.73(rounded)

As of  6-1-23
Updated Monthly

PE10 as report by Multpl.com

Bond Rate is the rate as reported by

Vanguard Long-Term Investment-Grade Fund Investor Shares (VWESX)

DCA is Dollar Cost Averaging.

Lump Sum is any dollar amount greater than one year salary.

Over a ten-year period the typical excess of stock earnings power over bond interest may aggregate 4/3 of the price paid. This figure is sufficient to provide a very real margin of safety--which, under favorable conditions, will prevent or minimize a loss...If the purchases are made at the average level of the market over a span of years, the prices paid should carry with them assurance of an adequate margin of safety.  The danger to investors lies in concentrating their purchases in the upper levels of the market.....

Common Sense Investing:
The Papers of Benjamin Graham
Benjamin Graham

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%
Stocks & Bonds

Allocation Formula

6-1-23
Updated Monthly

% Allocation = 100 x (Current PE10 – Avg. PE10 / 4)  /  (Avg.PE10 x 2 – Avg. PE10 / 2)]

Formula's answer determines bond allocation.

Current PE10.....29.97

Avg. PE10...........17.03

% Stock Allocation    0% (rounded)
% Bond Allocation 100% (rounded) 

Logic behind this approach:

--As the stock market becomes more expensive, a conservative investor's stock allocation should go down. The rationale recognizes the reduced expected future returns for stocks, and the increasing risk. 

--The formula acknowledges the increased likelihood of the market falling from current levels based on historical valuation levels and regression to the mean, rather than from volatility. Many agree this is the key to value investing.  

Please note there is controversy regarding the divisor (Avg. PE10).  The average since 1881 as reported by Multpl.com is 16.70.  However, Larry Swedroe and others believe that using a revised Shiller P/E mean of 19.6 , the number since 1960 ( a 53-year period), reflects more modern accounting procedures.

DYI adheres to the long view where over time the legacy (prior 1959) values will be absorbed into the average.  Also it can be said with just as much vigor the last 25 years corporate America has been noted for accounting irregularities.  So....If you use the higher or lower number, or average them, you'll be within the guide posts of value.

Please note:  I changed the formula when the Shiller PE10 is trading at it's mean - stocks and bonds will be at 50% - 50% representing Ben Graham's Defensive investor starting point; only deviating from that norm as valuations rise or fall.        

  

DYI

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Use this site at your own risk.

PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.

The Formula.

A value based allocation strategy

February 19, 2010 by John Kingham