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Jim Cook



Every once in a while I switch the TV channel from Fox to CNBC to see what the liberals are saying.  After listening awhile I get a deep sense of hopelessness and foreboding for our country.  The most important thing for the left is giving money to people.  They are happy to see the growth of food stamps, disability payments, housing subsidies, free healthcare and all the other welfare benefits.  They utterly fail to see the damage it is doing to the recipients.  Whole cities that once flourished have deteriorated into rotting eyesores populated with shambling hulks of chemically dependent drones.  These people are no longer employable.  They have become incompetent and helpless and the liberals can’t see that it’s their doing.

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The Best of Jim Cook Archive

Best of Bill Buckler
August 25, 2009
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Logically, the title of this Global Report is nonsense. By definition, all crises are short-term when compared with the much longer periods known as "normal". Nonetheless, a state of "perpetual crisis" is what many politicians across the West want people to believe! In any real crisis, emergency steps have to be taken, and politicians love taking them. They can then run roughshod over individual rights, property rights and

Since August/September 2007 and the start of the US financial and credit money system breakdown, one crisis after another has been paraded before the public - ongoing "terrorism", swine flu, global warming etc. All these are hoisted up to distract the American public away from the deflationary implosion of the US banking and financial system. Parallel to this has come the biggest bailout of an entire financial system
in history. As best can be counted, the US bailout bill is (at least) $US 12.8 TRILLION.

Florida Beats California:

This week, as The Privateer goes to press, reports are coming out that over the second calendar half of this year, 47 percent of houses in Florida will be "underwater" - the mortgage against the house will be higher than the value of the house. Once, this was a definition of bankruptcy, a state where liabilities exceed assets. Florida will cave in during the second half. The evidence? For the first time since 1946, Florida is
losing population.

Washington Beats Them All:

When Congress returns, it will have to raise the US debt ceiling from its present $US 12.1 TRILLION level. The Treasury is in the position of California and Florida. Its
liabilities too exceed its assets.

REAL Global Crisis Triggers:

Over the rest of the second half of this calendar year, the global triggers and landmines will be many. Massive market upsets are a certainty. For example, Japan's economy
returned to positive growth in the second quarter, following Germany and France out of recession, new data showed on

August 17.

Japan's economy, the second largest in the world, grew by 0.9 percent in the second quarter (April-June) after contracting for four straight quarters. Germany and France also reported positive GDP numbers. Since these nations are, at least on paper, working themselves out of the global recession, they are going to face increasing pressure to actually raise their internal interest rates. That is the real global trigger!

The nations which are first to raise rates will show strength. Those which don't will show the opposite.

All Hands On Deck:

It is inherent in any crisis that most individuals involved drop whatever they are doing and head towards a place where their help can do some good. In any REAL crisis, many private endeavours are put on hold until the crisis is over. Please notice here that most individuals have not forgotten their own earlier purposes and will return to them when the crisis is over. But this where governments come in!

A Government Crisis:

Any crisis gives to governments the excuse to step in to "fix" it. And a government "fix" almost always largely eliminates what were the previous individual rights of many individuals. The right to property, for example. The new rule becomes - Do As I Say.

When the crisis is government created, as most are, then government action almost always makes it worse. This is why the step is taken towards what can be called the "sequential" crisis. As soon as one "crisis" is solved, another one appears.

Once the stage of creating one crisis after another has been reached, and we have been at that stage for at least two decades, government becomes the all purpose - CRISIS
FIGHTER. At that point, what used to be normal life in civil society disappears under tidal waves of regulations which then inundate what were once normal actions. What was once done by right is now done by (government) permission.

There Once Was Freedom Here:

In the past, it was not only possible but mandatory for an individual in civil society to act privately in voluntary cooperation with others based solely upon their own peaceful
choices. This was known as: FREEDOM. Freedom defines an absence - something which is not there. Lord Acton stated this clearly: "Freedom is where government is NOT". Freedom always starts inside the individual's private property line where government needs a warrant to even enter. A nation based on private property has many areas owned by private individuals where freedom reigns. This is the REAL
"civil society".

The Crisis To End All Crises:

This crisis began back in August/September 2007 when the US financial system began to break down, taking the West's other financial systems down with it. At first, this crisis was called a credit-crunch. That was quickly elevated to a global economic crisis. A global economic crisis cannot get any bigger - it is,after all, global. Governments of all political colours have stormed into the breach and for all practical purposes made
their banking and financial systems into public utilities just like power plants.

Having already gained control of what money is, governments have now gained control over when, where and how that money is spent or invested. With their taxing power on the other side of the money creation power, governmental control over mens' monetary affairs can best be described as total.

Having Gained Control - Can They Keep It?:

Yes, for a while, by keeping the entire economic system in a state of perpetual crisis. The problem here is that this is the polar opposite of what most people want. They want to return to living their own lives.

This is the problem now facing governments all across the West. All of the "stimulus" they have done has to be seen to actually work. Any return to normality, to a situation where people return to dealing with their own affairs, has to be politically prohibited. Economic history shows what lies ahead. First, it will be allocations of real goods followed by outright rationing. After that comes conscription of labour.

The State In A Real Crisis:

Today, there is no better example of a state in deep crisis than the US. Federal US government expenditures are now 185 percent of tax receipts! The Obama administration is borrowing the difference. The US budget deficit reached a record $US 1.27 TRILLION for the first 10 months of the fiscal year and broke a monthly high for July, the government said August 12. This is deficit spending out of control.

Here Comes The Second US Real Estate Crash:

US commercial real estate values in the US fell 27 percent in the year through June. Estimates are that rents for offices, shops and warehouse space may continue to drop through 2010. The Moody Commercial Property Price Indices fell 1 percent in June and are down 36 percent from their October 2007 peak. This will hit the US financial sector broadside in September. Even commercial real estate owners who can service their loans today cannot get the roll-over finance and loans they need.

This situation is complicating the refinancing of almost $US 165 Billion in mortgages for skyscrapers, shopping malls and hotels later this year. Commercial real estate valuations can now be put side-by-side with the valuations of private houses. Both of these "assets" are the collateral foundation which all the other loans made against real estate rest upon. If the collateral crashes in value, so do all the lenders.


An Overview Of The Real US Economy:

Wholesale prices in the US fell more than forecast in July as energy costs receded, capping the biggest 12-month drop on record. The 0.9 percent decrease in prices paid to factories, farmers and other producers followed a 1.8 percent gain in June, the Labor Department said on August 18 in Washington.

A Short Interlude - Wholesale Prices And Deflation:

Wholesale prices are what major producers and other actors in the global economy look at to find where their own economic goods clear the markets. All across Europe, Asia and Latin America, producers are now biting the bullet. Having accepted that the global deflation is here and given up on any idea that the stimulus packages will bring back prices to their previous levels, they are now cutting prices.

The Real US Economy:

Imports at Los Angeles, the nation's busiest port, are down 16.9 percent to 305,226 cargo containers compared with a year earlier. For the year, traffic is down 15.9 percent to 3.77
million containers. In direct physical terms, this shows the REAL contraction of the US economy. When this collapse in import volumes is added to the contraction still taking place inside the US physical economy, a clear picture emerges TOTALLY at odds with all the "recovery" talk. In physical terms, this is depression territory.

Bad As It Is - This Is Only The Start:

The hard truth for Americans is that they have to start from where they are now. There is economically no other place to start from. For example, between 2000 and 2007, Americans added $US 7 TRILLION to the debts they owed against their
houses. They have spent ALL the money they borrowed. Now they look at mortgages where the sums owed exceed the value of the houses. Real bankruptcy awaits.

On the political level, the situation is even worse. The invisible deflation has caught out every state in the US from California to Florida. Fourday weeks, furloughs, etc. are hitting state and local public servants at ever higher speed. Cruising serenely
above it all in Washington - borrowing and spending is exploding. We are close to a breaking point. The "stimulus" is perpetuating the crisis. Normalcy is gone.

Ó 2009 – The Privateer

(reproduced with permission)


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