The boom cannot continue indefinitely. There are two alternatives. Either the banks continue the credit expansion without restriction and thus cause constantly mounting price increases and an ever-growing orgy of speculation – which, as in all other cases of unlimited inflation, ends in a “crack-up boom” and in a collapse of the money and credit system. Or the banks stop before this point is reached, voluntarily renounce further credit expansion, and thus bring about the crisis. The depression follows in both instances – Ludwig Von Mises
I re-watched the movie “The Big Short” this past weekend. It’s worth watching twice if you are interested in learning about how corrupt the entire U.S. financial system is. Now, my guess is that a lot of viewers left the theatre after watching the movie thoroughly horrified by what was presented in understandable form to the typical “main street” American.
However, most are likely unaware that the original sources of corruption and fraud were never addressed. In fact, if anything, legislative “reforms” like Dodd-Frank did nothing more than enable the big banks to continue using derivatives and Ponzi-scheme financial structures as mechanisms to continue sucking wealth out of the system. Perhaps what’s most humiliating about this is that Obama Government and Congress blindly let former Goldman Sachs CEO, Henry Paulson, in his capacity as Secretary of Treasury give these banks an $800 billion blank check from the Taxpayers to continue on with their criminality.
The credit and derivatives problems are, in reality, are worse now than they were in the period leading up to the financial market collapse. The legislative “reforms” served two purposes: 1) allow the banks to continue their ways under the illusion that the problems were fixed; 2) provide the banks with accounting tools which enable them to better hide the fraud.
It was reported today that the Central States Pension Fund, which handles the retirement benefit programs for Teamster truck driver unions across several large States, has formally filed an application to cut benefits up to 60%. It stated that the fund would be empty by 2025 if the application is denied.
This reflects how catastrophically underfunded this pension fund was in the first place. And make no mistake, if you are covered by a large institutionalized pension fund, public or private, your fund is equally as underfunded – it just has not yet been affected but it will be sooner or later.
This begs the question: with the stock market at near-record levels and Treasury bond prices at all-time highs, how is it at all possible that these pension funds are still underfunded to this extent?
The truth lies in the fact that the entire U.S. financial system is one gigantic Ponzi scheme. The Shadow Truth podcast show presents another Market Update in which we discuss the fact that the U.S. financial system is a giant mirage that has been fabricated by the Federal Reserve and the U.S. Government. It’s not a question of IF the next financial market collapse will occur – it’s a question of WHEN: