NCAA Tourney or Cyprus-- what to focus on??

Today's post is going to be a bit 'tough love' so fair warning on that..

So its Friday and boy we at A&G are in a real pickle..  We just don't know what to do..

See by nature, we can see the people out there in America-- coast to coast and heartland in-between.. a vast collection of entertainment-obsessed zombies currently transfixed solely on the NCAA basketball tourney with everything else distant second..

And yet we want to shake them and scream 'Cyprus'!!

But we've been burnt before..

No way do we consciously seek to be part of the 'Peter and the Wolf' game... one continual media cocktease that country X is going to collapse and trigger something bad if 'Y' deadline passes.. and Then..  And Then..

Everything gets magically settled.. or deadlines given the respect of children in an argument among adults i.e.  totally ignored...

Quite frustrating.

See we want to tell you Cyprus and the EU situation is getting Worse not better as of Friday, noon est time; that ATM limits there have been cut from withdrawls of 700 euros/day to 260/day... That the people are hitting the streets on droves and getting worse by the day..

That Cyprus is right now not at plan B or C, but trying to figure out a Plan E because:

Plan A was haircuts to depositors (Cyprus Parliament voted it down once idea became public)

Plan B was to beg Russia for money (on hands and knees and with pink lipstick if necessary) by privatizing whatever little resources of value Cyprus possessed, but Putin had absolutely no interest as of this writing

Plan C was a solidarity fund which is a professional way of saying take money from public pension and social security funds, among other options.

Plan D is restructuring and a Larger bank-deposit levy on accounts of 100k euros or more.. instead of 9% tax, it would be 12.2%-- Germany loves this plan because it really sticks it to the Russians who many wealthy have their money in Cyprus banks, and you know historically that whole Germany-Russia thing...

But we say ultimately there will need to be a plan E because if seizing the personal property of others was so repugnant a few days ago, how is it so attractive now?  If this happened and Then banks reopened, you'd see Mediterranean 'Spring'

Then again, Germany who is the real Master or 'Mistress' of this thumbscrew tightening enterprise will not accept anything less than depositors getting screwed... In a way, we don't know why Germany doesn't simply make the demand instead of this faux-show where Cyprus decides their fate...

Oh, wait.. ok we do..  Germany & Merkel get a bad enough public rap as it is... See what happens when you bail out nations instead of letting them collapse...they just want to bite your paw...

And of course the Cyprus banks are close to collapse which could trigger collapses and bank runs in other nations early next week...

We want to warn people to be cognizant of the situation, but its so hard when those who always assume everything will turn out OK in the end turn out correct, because the powers of economic manipulation are That strong, and the clueless populace roots it on...

So the market goes up instead.. just as an utterly manipulated market is supposed to..  And they go Yay! when Bernanke announces no change to infinite QE4 & 5 dumping $85billion a month into the stock market (That's $118 million dollars per hour-- yes, Hour!)

And they all go double-Yay! when he says no changes to the super-low interest rates to go on forever

And everyone just assumes the US is completely unaffected and we'd never have a bank holiday again, much less money stolen from our private accounts.. no no.. we have due process and well, we're Americans dammit...

Bernanke was asked yesterday by someone in the media whether a Cyprus-style grab of bank deposits is possible in the U.S. :

The specific question was as follows: "If a run on the banks happens in Cyprus, how that might affect U.S. markets. And also is it possible for the U.S. to levy a tax on regular deposits here? Or why not?"

Bernanke answered the first part in a roundabout way... said that due to Cyprus' insignificant size and scope, he didn't see it affecting the Eurozone, much less the US.

More importantly, he never answered or remotely addressed the second part.  Would it have been so difficult for Bernanke to officially say 'We'd Never Ever consider taking from the accounts of depositors Ever no matter what the situation... Ever!!"

Instead-- silence and evasion.

But here's why Bernanke is so wrong about Cyprus....  Let's use us as an example:  Which state is more important--  Texas or Rhode Island?

We know your answer-- bigger is better

And yet which state has more US senators?  Oh...what do you know.. they all have the Same.  And which state would the US government be more accommodating to if it wanted to secede and leave the Union?

Trust us.. the answer is Neither... And why?  Combination of precedent and both states have equal 'seats' at the proverbial table.

Well same applies with Cyprus at the European Union..  tiny island nation but it holds the same amount of votes in policy decisions as France, Germany and Spain..  Its not the inconsequential island some want you to believe..

So in a way, we're hoping nothing gets resolved next week, it triggers a massive bank run and panic throughout Europe and scares the shit out of Americans.

Sincerely so..

Its not we're sadistic or evil or hate Europe...far from it...

We Hate complacency.. We hate everyone so willing to keep their heads in the sand like ostriches and assume all is well because that rigged stock market is expanding..  We hate the blind, stupid trust and faith everyone has in their political leaders; their President

Like lapdogs...woof..

What Should be happening in this country is Congress make all the decisions to fix this economy.  Of course they voted that power away to the Fed in a hush-hush vote in the evening hours of Dec 31, 2008 so the hot potato wouldn't affect re-election chances..

But we're saying that's the biggest problem.  People tend to hold their congressperson's feet to the fire on controversial votes that impact their constituents' lives and livelihoods.  And when their representative blatantly ignores them it generates passion and anger in due time..

But when all the decisions are in the hands of the Fed who really no one has the slightest clue what it does, much less who it really serves...

And it is run by a quiet, mild-mannered, unassuming man who nobody could identify  in a photo if there was a reward attached, its much easier to institute policy to Hurt the bottom 99%...  And as long as that market is going up, well..  things can't be 'that' bad can it?

Ya gotta wake up!!.. Gotta start waking and shaking your friends and family...  Gotta start sincerely spreading word of us and our site to others for them to be informed and make up their minds..

Entertainment is nice..  And blocking out the world-- well you'll make a psychiatrist most proud...  But you gotta get your head into the real 'game'..  Because your personal finances are not as safe as you think.. not in an emergency...

Wheww.. just finished..12:15p.. Time for Basketball tip-off!  Go Team!!

Kidding...   Happy Weekend~

What would a 2013 US Bank Holiday look like?

OK, so today was supposed to be the day all was resolved in Cyprus, that little island country non of us cared about before and probably don't care about in the present..

Everything was supposed to magically work out to find a deal to keep their economy solvent and the banks were to re-open its doors...

Except none of that happened...

So now the EU has given this line-in-sand 'deadline' of Monday to come up with some way of financing the rest of the bailout that the EU only wishes to given in portion, and the lovely bank holiday, now in its 6th day counting last weekend, will continue for an additional 4 days.. until next Tuesday..

Supposedly...

Now most Americans think this will never ever happen to us, so they aren't really caring about Cyprus or looking with detached interest, like watching the after-effects of a car accident off to the side of the road involving people one does not know...

But we explained yesterday in some detail, we had a bank holiday once back in 1933.  Officially on a national level, it lasted 9 days counting weekends but prior to FDR declaring it, 33 different state governors had made the declaration and closed banks a couple weeks prior to FDR.

And if/when a bank holiday occurs in the US, this is what it will mean:

1) The only money you can access is going to be via ATM.  You won't be able to withdraw money directly, have it wired to other accounts, cash checks, cash out CDs..

We do believe bills will continue to be paid electronically but since that option wasn't available in 1933, we're only making logical assumption.  However you wouldn't be able to make any non-electric deposit into your account if you're short funds and need to pay bills.

There's also a good chance the stock market may close to coincide with the holiday so no means of cashing out stocks.

2)  The Executive Banking Act of 1933 established the President as ipso facto leader during a bank holiday.  Only he may declare one and he has ultimate final say as to its duration and what needs to be done during an emergency.

That means as unthinkable and perhaps unconstitutional as it seems, if the market plunged a few thousands points in a day, people mad-dashing to withdraw funds and the only way to resuscitate the economy would be to take, lets say 5% from the accounts of every depositor, you better believe he'd do it!

This is not a partisan attack on the current President.  We're pointing out in a true emergency, the President has that power and would do it if he is advised and believed that was the best option to save the nation from destruction.

That means never assume all is always to be hunky dory.

3)  Even if private citizens' accounts are not directly touched with money siphoned, expect the currency to be devalued.  This was done in 1933.

Its a bit complicated to get into.. the formulas and such, but using 1933 as a guide, the dollar was devalued by 40%.  Back then the currency was pegged to gold which was why FDR demanded upon pain of arrest, all gold be turned in...  Now its backed by nothing.

So simple math:  40% of $1 = 40 cents.  What was once $10 has value of $6

4) If a bank holiday lasts more than a couple days and there's no clear time frame for banks to open, expect to have your credit cards rejected by merchants.

When you use them, especially those tied to your checking account, they provide funds to the merchants which they 'cash out' into their accounts.  No bank functionality means there's no transfer of funds and merchants do not normally wish to wait for repayment.  This is occurring in Cyprus

So literal physical cash will be King.

5)  As we mentioned yesterday, what calmed the nation back in 1933 into ultimately returning their money back into the banks was FDR giving a 100% guarantee on all deposits no matter how big or small; no limit...  Then using the 'fireside chats' to assure the people all would be well...

And as we explained, after one year of that, when enough people were calm about their money in banks, the FDIC was created and lowered the insurance coverage maximum from infinity (which was not realistic for the US to back, but people were more gullible and trusting of government then) down to $2,500.

Over time the FDIC limit has been raised with it currently at $250k per account.

There's a little over $10 Trillion in total US citizens deposits with a National debt over $16 Trillion and government running yearly deficits...  Do you think that same '100% of everything' guarantee could be offered today... and believed?

The ultimate point of all this is to get it through your noggins not to be complacent and assume it will never happen here because we're so great or infallible...

Everything is inter-connected.

For instance here are the financial sources demanding blood, um.. we mean $$ from Cyprus?

1) The International Monetary Fund (IMF) which the US created and controls with a 16.4% veto power making it have a larger say in decisions made than All other nations in the IMF combined.

That means 16.4% of its funding to dole out loans come from the US i.e. US taxpayers.  We put a 'dummy' (sometimes literally so) European as head of the bank to diffuse the appearance we run it.

Side note.. the US also runs the World Bank but we make no effort to mask that-- the head of the World Bank is Always an American, appointed by the US President

2)  European Central Bank (ECB)    There may be other players too but basically its the EU...and who has received about $1 Trillion in backdoor, backstop funding since 2009 to keep its monetary unit solvent?

Yes.. the Federal Reserve..   And how does the Fed get money?  Its created out of thin air with money printed to match the amount needed, which adds up to newly created debt which someone has to ultimately repay...

See how incestual it is?

So don't be in la-la land and think things in small or third world nations don't have any affect on the great powerful Oz.. um.. Uncle Sam...

Prepare yourself all contingencies... There's really no good reason to keep your savings in a bank-- what is not used on bills, or emergencies other than a naive trust that government will protect you in times of economic chaos...

Or you're just one lazy grasshopper...