http://tomschuckmanjournal.blogspot.com/
tschuckman@aol.com
The selfish, hoarding side of me didn't want to post this material/ info. And this is another time when I MIGHT feel smug about 'being right' about something again. Another reality is that MOST people won't believe this anyway and just dismiss it as a "Chicken Little" rant or a wild dream of Old Soldier Tom... LOL. I once took a 'preparation test' of what to have in a real natural disaster/ emergency. But at the end, if we were caught flat footed-- at least having a few important tools redeemed us, like a good flashlight with extra charged batteries. Now days with the majority of people spending and charging everything like there is no tomorrow will sink most of our population.... just as the ghetto people in New Orleans depended on the Gov't to bail them out during Katrina... HA! Let me give you all a tiny bit of advice: 'Don't bet the next months rent on the GOV'T to save your sorry behinds!' And, of course, if you don't have a real relationship with the God of the Bible-- all of the above is worthless, null and void.
Tom Schuckman
tschuckman@aol.com
Old Soldier Tom
Jesus is my Lord and Savior.
Is the Bubble About to Burst?
Kah" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg79fcfQIn5ri4qglAaWIN1QcY9m-4xBkTpwKGhSB_tmaq_QCxedS-1AKafnUmMJobyh9xLDo267UoHRVHJsu0pxg_uqQ0LhzZWLqrm2c3FnX-Mv1Co4IfSMQ62I07z4wdVEiRxgfsNKjE/s800/118m5ig.jpg" border="0">By Gary Kah
Yes, it's true! The Federal Deposit Insurance Corporation (FDIC), the organization that "insures" your bank deposits, is officially broke. It ran out of money in early October due to the large number of banks that are continuing to fail.1 This news came in spite of the fact that the FDIC had raised its rates to member banks earlier in the year in an attempt to shore up its dwindling reserves.
When the financial crisis began in September of last year, the FDIC reported that 117 banks were in trouble. Since then approximately 80 percent of the banking companies on that list have gone under. To make matters worse, accordingto the FDIC the current number of troubled banks has risen to over 400. 2 Let's think positive and say that only 50 percent of these institutions will fail during the next year; that could mean the closing of another 200 banks – twice as many as in the last 12 months. (Seven banks failed in just one day on October 23rd.)3
The FDIC has a special arrangement to borrow up to $20 billion of additional funds from the US Treasury in an emergency, but that will only get the agency through a few more months. What happens when that fund dries up?
At some point the American people will realize how dire the circumstances are and, having lost confidence in the system, will seek to withdraw their money before their banks go under as well. If you believe such a scenario is unlikely, consider the fact that the FDIC recently announced it expected to be "in the red" through 2012.4
This situation is compounded by the scores of jobless Americans who are depleting their bank accounts in order to survive. Although the government reports the unemployment rate to be at 9.8 percent, the real unemployment rate is closer to 17 percent. Millions of Americans have stopped looking for jobs or have taken on part-time positions and therefore no longer appear in the government's statistics. This drain on wealth is putting an increasing number of banks at risk.
The US Government is also being affected. As a result of the dramatic rise in unemployment, Uncle Sam is taking in less and less tax revenue. The government's tax base is faltering not only because of fewer jobs and a slumping GDP, but also dueto the colossal amount of this year's tax write-offs resulting from last year's business and investment losses. Economist John Williams, who publishes the website Shadow Government Statistics, recently reported that the federal budget deficit for 2008 was $5.1 trillion based on a GAAP accounting basis. And, calculationsfrom the 2008 Financial Report of the US Government showed that the negative net worth of the federal government had increased to $59.3 trillion, with total federal obligations now totaling $65.5 trillion (based on GAAP).5 This figure is expected to climb to more than $70 trillion by the end of this year.
Where is this Leading?
It's really quite simple: We are broke as a nation! Were it not for the escalating amount of money the US Treasury is printing and the funds that we are continuing to borrow from foreign sources, our economy would have already come to a grinding halt. Many people who can see the handwriting on the wall are wondering how much longer we have, what will happen next, and what they should do to prepare.
Although I have my opinions, I have been hesitant to share them – especially when it comes to a timetable for future events. This is because of my belief that nothing happens unless God allows it. Global planners may do everything possible to create financial chaos in order to move the US into a new world monetary system, but if God chooses to intervene, it will not happen. Having prefaced my opinions with this statement, I will share with you the following thoughts.
I believe there is a growing possibility that a more serious financial collapse could occur between now and the end of 2010. I also believe that Barack Obama is "the anointed one" of the international elite and has been designated to take the United States into the new world order. As long as he is making unhindered progress toward their goals, they probably will continue to pump a measure of money into the US economy to create a "softer landing." However, if resistance to Obama increases to the point where he is no longer able to effectively push forward their (and his) agenda for world government, they could pull the financial plug and throw America into a crisis that makes our current situation seem benign. Globalization efforts by the international elite could soon be accelerated through a designed crisis if they fear Obama might lose his majority in the House and Senate in next year's election.
Most of the pieces are in place and our economic sovereignty has, for all practical purposes, already been handed over to international interests. This took place, unbeknownstto the American public, through agreements made at the G-20 summit in London (last April) and was finalized at the summit in Pittsburgh (this September). As a result, a group known as the Financial Stability Board – composed of the top central bankers of the world – is now running the show.
From now on the FSB will be making the most important financial decisions impacting the United States and the rest of the world. Six of the twelve national members on this board are from European countries. The United States, with a GDP three times that of the next largest G-20 member (Japan), will have only one vote.6
Europe's top financiers are making a strong case against the US dollar. Joining them are the Arabs, Brazilians, Russians, Japanese, and Chinese. On September 6, Cheng Siwei, a top member of China's Communist hierarchy and the former vice-chairman of the Standing Committee stated,
If they [the US Treasury] keep printing money to buy bonds it will lead to inflation, and after a year or two the dollar will fall hard. Most of our foreignreserves are in US bonds and this is very difficult to change, so we will diversify incremental reserves into euros, yen, and other currencies.Mr. Cheng went on to say,
"Gold is definitely an alternative, but when we buy, the price goes up. We have to do it carefully so as not to stimulate the markets."7China bears close watching, as it is the world's largest holder of US and other foreign bond reserves – valued at more than $2 trillion.8 If it ceases to buy US bonds, or if it were to transfer a substantial amount of its reserves held in US bonds into gold and other more stable currencies, it would push the price of gold and these other currencies significantly higher while driving the dollar down.
On a related front, Gulf Arabs are planning – along with China, Russia, Japan and France – to stop using the US dollar for oil trading. On October 6, The Independent reported that leaders of these countries are moving instead to a basket of currencies including the Japanese yen and Chinese yuan, the euro, gold and a new, unified currency planned for nations in the Gulf Co-operation Council, including Saudi Arabia, Abu Dhabi, Kuwait and Qatar.
According to The Independent,
Secret meetings have already been held by finance ministers and central bank governors in Russia, China, Japan and Brazil to work on the scheme, which will mean that oil will no longer be priced in dollars. The plans, confirmed to The Independent by both Gulf Arab and Chinese banking sources in Hong Kong, may help to explain the sudden rise in gold prices…The transitional currency in the move away from dollars, according to Chinese banking sources, may well be gold. An indication of the huge amounts involved can be gainedfrom the wealth of Abu Dhabi, Saudi Arabia, Kuwait and Qatar who together hold an estimated $2.1 trillion in dollar reserves.The report continued:
The Chinese believe…that the Americans persuaded Britain to stay out of the euro in order to prevent an earlier move away from the dollar. But Chinese banking sources say their discussions have gone too far to be blocked now. "The Russians will eventually bring in the ruble to the basket of currencies," a prominent Hong Kong broker told The Independent. "The Brits are stuck in the middle and will come into the euro. They have no choice because they won't be able to use the US dollar."Transition Underway
"…These plans will change the face of international financial transactions," one Chinese banker said. "America and Britain must be very worried. You will know how worried by the thunder of denials this news will generate."9
Even though the stated deadline for the completion of this currency transition isn't until 2018, the dominos have already begun to fall. Iran, for example, announced in late September that it would henceforth be selling its oil in euros rather than dollars.10 The nations of the world have begun moving away from the dollar, and the Obama administration is doing little, if anything, to stand in the way of these developments.
Meanwhile, the 2009 Trade and Development Report issued by the UN Conference on Trade and Development in Geneva, presents a blueprint for getting nations on a new SDR (Special Drawing Rights) world system in the near future.11 If they succeed it would facilitate a rapid move away from the US dollar as the world's main reserve currency.
There are many complex developments and plans to sort out; the aforementioned represent just the tip of the iceberg, making it difficult to project exactly how events will unfold. But here is what we know for sure. The financial movers and shakers of the world want to replace the dollar with a new international currency. They will do whatever it takes to make this happen and are eager to do it sooner rather than later, while Barack Obama is at their beck and call.
What we do not know is exactly how long this transition will take, and whether the US will first be moved into a regional currency or if this step will be by-passed in favor of an immediate global currency. There are other questions, including: How much resistance will there be from the people of the United States and Britain, and their legislative bodies? Will there be a partial or complete collapse of our economy? Will other types of crises be precipitated (via terror, war, disease, etc.) to accommodate this change? And, will God in his mercy intervene to give us more time? These variables make it impossible to set dates with any degree of accuracy. However, it is important to get prepared now in case things fall into place quickly, which they could.
Every indication suggests that when the new currency is issued, it will involve a major revaluation. Rumor has it that if the new currency were to be released soon (within the next year or so) we could expect a 6:1 devaluation. In other words, if you have $6,000 in a bank account, you would have only 1,000 units of the new currency when your bank reopens. If such an event were to occur, banks would shut down for a period of time, meaning you would not have access to your accounts and probably not your safety deposit box for several days to several weeks. In some cases involving currency revaluations in other countries, bank authorities have seized the contents of citizens' deposit boxes. For this reason I would consider moving valuables out of my box to another location – possibly a fireproof safe in my home.
What to Do
Although my professional background is in economics and international business, I have been reluctant to tell people what to do with their personal finances, as everyone's circumstances are different. Furthermore, I am not a professional financial planner or advisor. However, because so many people continue to call or write us on this matter, I will give an example of what I personally would do if I had significant money to invest.
First of all, I would get out of debt, while giving generously to biblically solid ministries who are speaking the truth. But if I had cash left to invest after doing so, here is what I would do with it. I would keep up to 5% of my money on hand in the form of cash. This would be for short-term purchases of groceries, gas, and day-to-day items in case a banking holiday is declared where banks would shut down for a few days or weeks before introducing a new currency. Eventually all old currency will be worthless unless it is traded in for the new, so I would not hoard large amounts of cash – only enough to get through a brief period of time. All of my other investments would be geared toward off-setting the affects of a currency revaluation that would likely occur if the dollar is replaced with a new regional or global currency.
I would plan to remain in such investments until the new currency is introduced and any revaluation of the "old" US dollar has taken place. After this transition has occurred, some or all of these investments could be traded back in for the new currency. By temporarily putting my dollars into items more likely to hold their value it would help off-set any losses that might occur with a revaluation. For example, if I would eventually be given only one new currency unit for every six dollars, then it would have been better if I had put my dollars into gold or other stable currencies and then sell them off in exchange for the new currency once it comes out.
This is how I would invest my remaining 95 percent. I would put 10% of my money into silver coins that could be used to barter for goods and services. Silver is perhaps the most practical of the precious metals because of its affordability and potential use as a bartering item. Historically, it has at times been valued at 10% of the price of gold. It is currently trading at less than $20 an ounce (2% the price of gold). I consider this to be a good price.
Another 25% of my portfolio would be put into a combination of gold and platinum, which should continue to trade in the $1,000 range for the near future – possibly going significantly higher if China and other countries continue to buy gold or if the crisis intensifies. I would also consider putting 25% into Swiss francs or a combination of other stable foreign currencies. All such purchases would depend to some degree on whether prices are favorable at the time I consider the purchase. Also, the percentages of what I invest in would be conditional on the amount of wealth I have. Someone with a million dollars, for example, would invest differently than someone with $10,000. I am basing my scenario on what I would do with $100,000.
I would invest the remaining 35% in survival related items. I would purchase a few acres of land with available firewood and a fresh spring that could also be used for growing food. The fact is people can't eat silver and gold. Food and water are necessary for survival. In planning ahead it would be a good idea to keep some extra food and basics on hand for difficult times.
As Christians, anything we do to prepare should be done unselfishly, keeping others in mind. If we are in a position to help others when things come crashing down, it will be a strong testimony to those who are unprepared. Difficult times could present unique opportunities to share the gospel of Christ with those who've been unwilling to listen before.
While Christians should be prudent and plan wisely as the Lord directs, our number one focus must be on our relationship with Him. We should use this time to grow in our walk, learning to depend on His direction in every facet of our lives. Just getting our houses in financial order won't be enough in the days ahead. We will need supernatural discernment and perseverance that only the Holy Spirit can bring. Draw close to Jesus and He will provide the strength you need to stand firm while facing the challenges ahead!
For God did not give us a spirit of fear, but a spirit of power, of love, and of a sound mind. - 2 Timothy 1:7
Endnotes
1. CNN Headline News, October 15, 2009.
2. MarketWatch, "FDIC: Number of troubled banks rises to 416," Boston, August 27, 2009, http://www.marketwatch.com/story/story/print?guid=637EA711-9253-43CA-89E8-22193EF436A5
3. Fox News, October 23, 2009.
4. CNN Headline News, October 15, 2009.
5. WorldNetDaily, From Jerome Corsi's Red Alert, "It's Official! U.S. government is bankrupt," October 18, 2009, http://www.wnd.com/index.php?fa=PAGE,printable&pageId=113366.
6. Dick Morris, "The Declaration of Independence has been Repealed," April 6, 2009, http://www.dickmorris.com/blog/2009/04/06/the-declaration-of-independence-has-been-repealed-#more-568.
7. The Telegraph (U.K.), "China Alarmed by US Printing Money," September 6, 2009.
8. Ibid.
9. Robert Fisk, The Independent, "The demise of the dollar," October 6, 2009, http://license.icopyright.net/user/viewFreeUse.act?fuid=NTIyMDAyNg%3D%3D.
10. Ibid.
11. United Nations Conference on Trade and Development - Geneva, "Trade and Development Report, 2009," Overview, pp. 10-13.
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