Anybody expecting a singular, pivotal, high-octane event that signaled the end of the dollar is bound to be disappointed. However, if you are locked into reality, and realize that all human behavior is made under a personal, objective mindset, you’ll find everything you need to know to prove what we’ve all been talking about for the past few years (many, many more if you are among the likes of Ron Paul). The dollar is being abandoned. Ironically enough, US citizens appear to be on track to be the last ones to realize this. 

Over the weekend, India reported that they had reached an agreement with Iran to transact all oil purchases in Rupees…and no long conduct business in U.S. dollars. This marks yet another Asian country to officially leave the dollar-denomination system when conducting international trade with other (select) nations.

This is in junction with the happenings of the past few months, where significant Asian nations are dropping the dollar for use in trade between each other. This includes:

China and Japan, the #2 and #3 largest economies of the world, dropping the dollar-denominated trade.

China and Russia dropping dollar-denominated trade, and expanding the bond market for China.

Russia and Iran dropping dollar-denominated trade.

China and Iran dropping dollar-denominated.

India and Japan entering massive currency swap agreements.

And now, of course, India and Iran dropping dollar-denominated trade.

If you haven’t been paying attention, allow me to sum this up really quick: the world reserve currency, the US dollar, is being dropped for use in trade by some of the largest and most productive countries of the world. Not denominating trade in dollars reduces the use of holding them as reserves in large quantities, which in turn results in this: a reduction in dollars being held, which leads to far more dollars in circulation that people are not willing to hold. China and Russia are two prime examples of countries with significant dollar holdings that are being wound down.

Countries are trying to reduce their exposure to US treasury bonds, or in other words…our national debt.

The sad part here is that the news media in the United States (Fox News, CNN, etc) has not, and will not cover this. I cannot tell you definitively why they withhold such crucial information, but I will tell you this: they are not reporting facts, or reality for that matter.

Think about it this way: take a look at the countries involved here. China and Japan (two of the top three economies of the world), India (with China, the highest population) Russia and Iran (strategically important for natural resources) have ALL DROPPED THE DOLLAR between each other. Another important aspect to notice here: all the nations involved (minus Iran) are included in the top 6 oil consumers of the world (in case you were questioning their viability).

This, combined with the global movement to reduce exposure to US debt, will push a substantial amount of currency into the markets, which will in turn weaken the US dollar across the board. The Federal Reserve, the ultimate enabler, will have to further step up their bond buying of US debt, which in turn expands our money supply even further. The dollar is destined to go to junk status with the amount of paper out there.

My friends, if you aren’t awake yet to the disaster that awaits us, I urge you to start doing some research and take the necessary financial steps to protect your wealth. This is so far beyond politics…this is about economic survival. Get out of US dollars, and into some real assets.

Related articles

• Guest Post: New Asian Union Means The Fall Of The Dollar (zerohedge.com)
• New Asian Union Means The Fall Of The Dollar – BlackListedNews.com (2012indyinfo.com)
• China, Japan unveil deals to tighten finance ties (sfgate.com)
• Dollar on the downslide (traditionalchristianity.wordpress.com)

The message being sent is perfectly clear: the government wants control over the internet. This should not come as a surprise by any means, especially when one considers how powerful the content & information sharing medium is at rallying against the corrupt practices within our corporatist-socialized governing body. This should push most people to realize why they must oppose such steps being taken by the government to silence, or control content providers. The government usually isn’t crazy about the whole “free speech” thing.

Here are some stills from today that highlight the “strike” of information and content providers:

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Many websites plan to “go dark”, or go on the proverbial strike in protest of proposed legislation enabling the government to have powers to censor and block content that they deem in violation of copyright law. SOPA (Stop Online Piracy Act) and PIPA (Protect IP Act) are the two bills being considered by the House of Representatives and the Senate, respectively.

I stand with those who stand against this form of internet censorship. The premise is presented delicately enough for the government, who claims this would be a tool for content owners to go after ‘foreign’ websites delivering content in violation of copyright law. For many, including myself, the fear is not specifically pirated content…it is what the government may decide the best course of action is for halting the usage of said content, wherever it may be.

This also includes surrendering internet content to the discretion of the government, or whomever they appoint (unelected of course) to chair this type of operation. Who among us is to determine the merits of use or distribution of information if it is being argued that no one among us has fair intentions?

If you give the government an inch, they will most certainly take a mile…and threaten with force by means of coercion. The internet is the embodiment of information and utilization…a free market of ideas in one of its purest visible and applicable forms. Don’t let the government screw it up.

Please, do some research and educate yourself on these issues. There is a lot at risk here…and a lot to lose if you don’t join others in standing up for our freedoms.

Related articles

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Peter Schiff, right on the money. In all seriousness, if he isn’t on the short-list of economic advisors for whomever will end up replacing President Obama, I’m going to slap them. Anyways, Schiff is right on the money here…pay attention.

I don’t agree with all, or even more than half of his personal beliefs…but his accomplishments are of equal importance. Here are some quotes you may or may not realize are attributed to him.

“A genuine leader is not a searcher for consensus but a molder of consensus.”

“Change does not roll in on the wheels of inevitability, but comes through continuous struggle. And so we must straighten our backs and work for our freedom. A man can’t ride you unless your back is bent.”

“In the End, we will remember not the words of our enemies, but the silence of our friends.”

“Nothing in all the world is more dangerous than sincere ignorance and conscientious stupidity.”

“Our lives begin to end the day we become silent about things that matter.”

Back in July of 2011, I wrote about when we could expect QE3 to be announced. The way I saw it, bond yields could not stay that low without additional action. Rather than outright bond purchases again, we got “Operation Twist”, or the reinvestment of maturing short-dated debt into longer-term debt. The keys to watch were the same back then as they are now: unemployment and inflation. While both are heavily doctored numbers that any sensible, educated person wouldn’t perceive to be even slightly truthful, another element of decision making could enter the arena: the speed of which the Euro continues to collapse.

Any perceived loss of confidence in the markets, especially the bond market, will trigger a QE3-type action. Interest rates must be kept under relative control so long as our economy is sitting idle without growth. Any significant short-term or long-term drops in the stock market over the next 6 months will also trigger it.

All of that being said, the news of late is that the Fed is definitely still considering QE3.

It is, of course, anyones guess as to how much more damage the dollar can take to its reputation before people start doubting its status as a safe-haven asset.

Image by slolee via Flickr

On Friday, S&P downgraded the credit ratings of over half the Euro-zone. Included among them was France, the perceived 2nd-strongest economy in the Euro-zone. Granted, this is one ratings agency…and Germany did manage to retain its current AAA bond rating. But with reports like this emerging out of Europe about the sovereign debt situation in Germany, one can only wonder how long the facade can last. 

Why does this matter? The Euro is already essentially a doomed currency, with a revolving door of member-nations needing bailouts and specially doctored refinancing of existing debt. A credit downgrade is similar to your credit score getting knocked down a few notches. You may not be able to borrow money at existing low interest rates, because you pose a greater risk of the lending party not getting their money back.

This, of course, makes borrowing any more money more expensive than before. France is an important player in this downgrade…not only do they have heavy exposure to sovereign Euro debt (this means they own a lot of bonds that other countries may default on) but they themselves are having trouble paying their bills…and in a socialist hotspot like Europe, it can be next to impossible to make any kind of fiscal cut whatsoever without sparking riots in the streets.

Yes, the Euro-crisis is accelerating. Don’t worry USD, your turn is coming.

One of the main reasons the Fed had to step in and begin purchasing US debt was because other nations had scaled back their purchases. With less buying at the auctions, rates on our debt were starting to increase. Before the cost of borrowing could become anymore expensive, the Fed began QE2, a $600 Billion bond purchasing program. All of this artificial purchasing was done by the Fed creating money out of thin air by expanding their balance sheets to take on these new bonds. When the bonds they already had began to mature, the short-dated debt (shorter term maturing bonds) were rolled over in long-dated debt, otherwise known as “Operation Twist”. The goal here was to funnel money to keep long-term interest rates as low as possible, in addition to short-term interest rates.

The stock market has been a wild and crazy ride…anyone will tell you that. The important thing to know here is that people are going to the perceived ‘safety’ of treasury bonds rather than put their money into the stock market, or other investment vehicles right now. With all the artificial demand the Federal Reserve has created for bonds, prices are very high, which have resulted in very low yields. So much buying action has taken place that yields on a 10-year treasury bond hit a record low today, at 1.90%. 

The bond market is in a bubble. This is likely the final, last major bubble of our modern US economy before a new monetary & financial system and structure are put into place. Treasury bonds are paper assets denominated in dollars, and we KNOW the Federal Reserve has expanded the money supply by well over 200% in less than three years. We KNOW that they want to keep interest rates as low as possible. But what happens when interest rates start to rise, and people start dumping their dollars for cheaper dollars?

Hyperinflation is not an impossibility. I fear the ramifications.

Related articles

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• QH&R: U.S. Debt Hits $15 Trillion (radocracy.com)
• The Fed: Fed seen unveiling QE3 bond plans by summer (marketwatch.com)

One of the biggest problems with our current militarism around the world is that we end up footing the bill for many nations that should be taking care of themselves. This has resulted in a very expensive operation that spans many, many nations and causes us to send our troops to the far corners of the world in the name of someone else’s safety. True, we have a volunteer military, and that is certainly unique and quite honorable. But as with most acts of volunteerism, you cannot abuse it…or it may go away. Whether it changes due to change of heart, or necessity, is yet to be decided.

The only way to sustain an overseas presence this large is to either tax more, or cut from other parts of the government. This country is obviously ready to do neither.

As for the case of our hundreds of military bases around the world, I must ask fellow conservatives where their principles lie. Certainly we can agree that the reason we don’t have the state provide everything to people is because that destroys incentive, and would be incredibly destructive and detrimental to the process of delivering said functions to the people. In short, we agree government solutions do not work. So why does so much of the Republican party support that exact same notion for the world when it comes to defense? If the United States is going to subsidize the military of several nations, who is footing the bill? Where will the incentive be for foreign nations to come to conclusions with their own neighbors rather than relying on the US as a broker? And speaking of “broke”, don’t our own finances look rather terrifying right now?

It’ll ultimately come down to either being a hasty pullback from abroad, due to the fact that dollar-denominated checks will bounce and we won’t be able to fund our overseas babysitting campaign, or we can gracefully allow nations of the world to deal with their own sovereignty and deal with their neighbors as they deem necessary.

While we’re letting other nations take care of themselves, it would be nice for our government to focus on one of the tasks they SHOULD be taking on: our security at the border. Currently, states are having to take matters into their own hands due to the lack of commitment from the Federal level. Let us not forget how dangerous that border with Mexico is. This is nothing against Mexicans who want to come into this country…I am more than welcome to immigrants, and believe the process should be streamlined and made as efficient as possible to allow those who desire to become US citizens do just that. What we cannot have, however, is US citizens endangered because our border security is lacking, while the US government and military spend billions on the borders between countries on the other side of the globe.

A Pro-America foreign policy would focus on our national defense and security, starting at home, with our own borders.