JIM ROGERS on U.S. GOVERNMENT SHUTDOWN - U.S. NOT on Brink of DEFAULT & will PRINT more MONEY.

U.S. NOT on Brink of DEFAULT & will PRINT more MONEY. JIM ROGERS on U.S. GOVERNMENT SHUTDOWN


The real crisis is that jobs offshoring by US corporations has permanently lowered US tax revenues by shifting what would have been consumer income, US GDP, and tax base to China, India, and other countries where wages and the cost of living are relatively low. On the spending side, twelve years of wars have inflated annual expenditures. The consequence is a wide deficit gap between revenues and expenditures.

Under the present circumstances, the deficit is too large to be closed. The Federal Reserve covers the deficit by printing $1,000 billion annually with which to purchase Treasury debt and mortgage-backed financial instruments. The use of the printing press on such a large scale undermines the US dollar's role as reserve currency, the basis for US power. Raising the debt limit simply allows the real crisis to continue. More money will be printed with which to purchase more new debt issues needed to close the gap between revenues and expenditures.

The supply of dollars or dollar denominated assets in foreign hands is vast. (The Social Security system's large surplus accumulated over a quarter century was borrowed by the Treasury and spent. In its place are non-marketable Treasury IOUs. Consequently, Social Security is one of the largest creditors to the US government.)

If foreigners lose confidence in the dollar, the drop in the dollar's exchange value would mean high inflation and the Federal Reserve's loss of control over interest rates. It is possible that a drop in the dollar's exchange value could initiate hyperinflation in the US.

The real crisis is the absence of intelligence among economists and policymakers who told us for 20 years not to worry about the offshoring of US jobs, because we were going to have a "New Economy" with better jobs.

Because tropical storm Karen is brewing over the Yucatan Channel and the southern Gulf of Mexico, the federal government has seen fit to call back thousands of FEMA's furloughed workers. The script-reading corporate media noted the fact this morning:
Yes, the Obama administration has been making a big show of taking down government websites and blocking off the World War II Memorial, but overall business in Washington D.C. is being conducted pretty much as usual.

It turns out that the definition of "essential personnel" has expanded so much over the years that almost everyone is considered "essential" at this point. In fact, this shutdown is such a non-event that even referring to it as a "partial government shutdown" would really be overstating what is actually happening. The following are 36 facts which prove that almost everything is still running during this government shutdown... rand paul
"jim rogers" u.s. government shutdown closed economy crisis

#2 Approximately 1,350,000 "essential" federal employees will continue to work during this "government shutdown". #4 The U.S. Postal Service will continue to deliver our mail. #5 U.S. military personnel will remain on duty and will continue to get paid. #6 Social Security recipients will continue to get their benefits.

#7 Medicare recipients will continue to get their benefits. #9 Food stamp recipients will continue to get their benefits. #10 Those on unemployment will continue to get their benefits. #11 Federal retirees will continue to get their pensions. #12 The federal school lunch program has enough money to go through at least the end of this month. #13 Public schools all over the country will continue to stay open.

The real crisis is not the "debt ceiling crisis." The government shutdown is merely a result of the Republicans using the debt limit ceiling to attempt to block the implementation of Obamacare. If the shutdown persists and becomes a problem, Obama has enough power under the various "war on terror" rulings to declare a national emergency and raise the debt ceiling by executive order. An executive branch that has the power to inter citizens indefinitely and to murder them without due process of law, can certainly set aside a ceiling on debt that jeopardizes the government.