So, let's start off with basics. According to US Debt Clock.org our sovereign national debt as of this writing is 14.498 Trillion dollars. Any thinking individual would now compare this number to our GDP (for credit worthiness). According to the CIA Factbook our estimated GDP for 2010 was 14.66 Trillion Dollars. Simplified, GDP is the value of every good and service produced in this country minus debts (essentially our net income). Doing the math, this puts our Debt to Income ratio at approximately 98.89%. In our current system, we need people to loan us money. Do you really think that's going to happen forever with a debt to income ratio like that and accelerating exponentially?
Now, I have a simple question, and one that nobody seems to be asking. To whom do we owe this money? Despite what most people tell you, according to two sources, The Congressional Budget office, and Political Calculations, the biggest holder of our debt is US Citizens and Institutions. How ironic is this??! We're being told that in order to balance the budget, we as US Citizens need to take a haircut. So we need to take a haircut in order to pay ourselves?!?!
Let's back up a bit. How about the entire world's debt? Economist.com puts the entire world's debt at 39.846 Trillion dollars and counting. But, this number doesn't make sense either. If the entire world is the entire economy, how can it owe any money at all? Common sense says this number should always be 0. Therein lies the biggest problem with the world we live in. Whom does the world owe this money to? I don't know about you, but I don't owe any money to Extra-Terrestrials (anymore).
How can the world owe money? There are two things our basic monetary system is based on that will answer this question. The first and most simple of the two is that we, the people of the United States (as well as most of the world) don't own our own currency. Look at the Bills in your wallet, notice that they say "Federal Reserve Notes?" The federal reserve owns the dollar. But as most of my readers probably know, it is a private bank owned by private interests. Who are these private interests? Good luck finding specific names and numbers, people get killed looking for that information. The best synopsis can be found in a four part article series starting here. So, if private bankers own our entire money supply; which also own the private central banking system of the majority of the world; it stands to reason that they are likely the majority stakeholders of the debt of the entire world.
The second cause which was also built into the system is the fractional reserve banking system. This is how banks lend money. As an example of how this works lets say that the government decided to create $100 to pay you for an infrastructure project. First, they request the money from the private Federal Reserve, which sells it to the government at $100 plus the going interest rate at that time. Now if you think about how that works, if only $100 was created but $100 plus interest is owed back to the Fed, obviously it doesn't exist and this is the number one cause of our national debt as stated earlier. (I got side tracked, back to fractional reserve banking.) You take your $100 and deposit it in your bank account. The bank can then lend (according to US Law) 90% of the deposited funds. So, they lend $90 of it out to another fellow. He deposits the $90 in his bank account, of which that bank lends out $81 to another fellow and on and on it goes. Of the original $100 that was created, now there is a total of $900 in debt that gets created (90+81+72.90.......). Yet $800 of that $900 in debt doesn't exist. Where does it come from?
Don't believe the fed is a private bank and unaccountable to anyone? Read this. (Yes it does say that the fed lent $16 TRILLION without asking anyone......)
If you would like more information on these issues. There are some amazing movies out there that will illustrate it further. My two favorites are below. They are both full-length movies but they are absolute MUST WATCH movies for any aware individual.
So from these two fundamental problems with our system rises an exponential Income disparity gap. This occurs because we all know that due to these basics and others, debt is exponential. Since we already know that this debt is owed to a small number of people we have our cause of this exponential Income disparity gap. This is also why the powerful will stop at nothing to keep up the status quo.
Getting back to our original question, is depression two avoidable? Not when it's baked into the pie. The only chance I see is to change the recipe of the pie. (ed note: I give this a 5% probability.) I think this recipe change was outlined very well in "The Secret of Oz." The question is how does this happen? How do we change it when the people benefiting from it are the people that control it? Good luck getting corruption to "un-corrupt" itself. Also, I hate to burst the bubble, but any aware individual on main street knows depression number two is already here. It just hasn't hit Wall-Street just yet. (I give it months). Could you imagine being in this crowd? After you see that, imagine what it'll look like when extended unemployment runs out at the end of the year. The real question is what do we do to minimize the impact of our economy going bust.
There are many solutions. The best solution in my opinion is to unplug from this game of economy and dollars. This is known to me as peaceful non-compliance. Don't get me wrong, this solution takes time and a serious change to your daily life (I'm still not there yet either). This is done in many ways, through buying local goods, becoming self-sufficient, or even using cash or a local currency as much as possible. Form your own local economy. All that is needed to form a local economy is the willingness and the participation of a local group of people to do as much business as possible with people in the group. We already have the tools to accomplish this! Forming a community is KEY to surviving the economic mess ahead of us.
Remember, WE gave this beast our permission by giving it our money. Money = time+effort = power. If we give them our power then we have nobody to blame but ourselves.
Once enough of us do this, our economy will crash, but will you care? You don't need it anymore and THAT is freedom.
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