Preparing for the Ultimate Crisis

It certainly seems that the closer the world gets to a potential financial meltdown...the more the Western world seems to fall asleep.

Long time readers of this blog know I have written many times about how our paper money is now based solely on FAITH.  The only reason that anyone takes a $20 bill from you is because they have FAITH that they will be able to use it tomorrow to exchange it for goods or services that they require.

They have FAITH that they can bring it to a bank and the bank will accept it for deposit to be put toward their car loan, home loan or credit car payment.

The world has FAITH in the U.S. dollar because it is backed by the FULL FAITH AND CONFIDENCE in the U.S. Government and as of now the world still has confidence and faith the U.S. Government is going to protect its currency and pay its obligations.

But what happens when people lose faith in a government's paper currency?  We don't have to guess...we can actually look around the world and see exactly what happens in Argentina, Greece, Russia, etc...  When the confidence wanes, people on the street demand to be paid with something tangible (gold, eggs, labor) or they will demand to be paid with other paper money that they still DO have confidence in.

Today I received this email from a financial service firm...no doubt they are selling newsletters and no doubt they WANT to disturb their readers so you feel that you need to buy their newsletter...but what I found interesting was their discussion on FAITH.

Preparing For the Ultimate Crisis 

The final and ultimate round of the Crisis that begin in 2008 will occur when faith is lost in the Central Banks. 

The entire rally in stocks post-2009 has been due to Central Bank intervention of one kind or another. Whether it be by cutting interest rates, printing money, buying bonds, or promising to do more/ verbal intervention, the Fed and others have done everything they can to push stocks higher. 

As a result, today, more than 90% of market price action is based on investors’ perceptions of what the Central Banks will do… NOT fundamentals. For instance, if bad economic data hits the tape, the market tends to rally because investors believe this will result in the Fed having to print more money. 

Again, the primary driver of stocks is no longer fundamentals, but Central Bank intervention. 

There are many problems with this, not the least of which is the fact that we now know that Central Bankers will openly LIE about what they’re doing. Consider the recent revelations concerning ECB President Mario Draghi’s claim that he will do “whatever it takes” to hold the EU together. 


Geithner: [T]hings deteriorated again dramatically in the summer which ultimately led to him saying in August, these things I would never write, but he off-the-cuff – he was in London at a meeting with a bunch of hedge funds and bankers. He was troubled by how direct they were in Europe, because at that point all the hedge fund community thought that Europe was coming to an end. I remember him telling me [about] this afterwards, he was just, he was alarmed by that and decided to add to his remarks, and off-the-cuff basically made a bunch of statements like ‘we’ll do whatever it takes’. Ridiculous. 
  
Interviewer: This was just impromptu? 

Geithner: Totally impromptu…. I went to see Draghi and Draghi at that point, he had no plan. He had made this sort of naked statement of this stuff. But they stumbled into it. 

Here is former Secretary of the Treasury, Timothy Geithner, stating openly that Mario Draghi had “no plan” and was simply bluffing when he claimed, “we’ll do whatever it takes.” 

Draghi  was not only being deceptive (he didn’t have a plan); he was actually lying in the sense that the ECB couldn’t “do whatever it takes.” The OMT policy he talked about creating is in fact illegal based on EU law. He couldn’t do anything then and he can’t now. 

And yet, EU stocks have rallied hard, EU sovereign bond yields have fallen, and the world has proclaimed that the EU Crisis is “over”… all based on this lie. 

If you think Draghi is somehow unique in this regard amongst Central Bankers, thinking again. Recently Bank of Japan Governor Haruhiko Kuroda increased the Bank of Japan’s QE program, not because it would benefit Japan’s economy, but because doing so would make his colleagues’ forecasts better match his own. 

Put simply, the folks who are supposed to be holding the financial system together have been caught openly lying and spending money just to suit their own egos. The consequences of this have not yet been felt. But the seeds of the next crisis have already been sown in these revelations. 

The next time stuff hits the fan, will the world be as trusting in Central Banker proclamations? Will we continue to believe these folks are omnipotent? Or will their phony promises accomplish nothing? 

Friends, please read this twice!  The newsletter has NOTHING to do with Christianity....it is a Wall Street Newsletter but this last paragraph is so prophetic that it bears repeating....

The next time stuff hits the fan, will the world be as trusting in Central Banker proclamations? Will we continue to believe these folks are omnipotent? Or will their phony promises accomplish nothing? 

No!  The central bankers of the world are NOT omnipotent!!  Only God is!

Yes!  Their phony promises (which are really lies) will not accomplish anything!!  Liars are really children of the devil...and the devil is the prince of this earth and is in control of everything during this dispensation of grace that we are living in.

1 John 5
19 We know that we are children of God, and that the whole world is under the control of the evil one. 20 We know also that the Son of God has come and has given us understanding, so that we may know him who is true. And we are in him who is true by being in his Son Jesus Christ. He is the true God and eternal life.

Friends!  The finish line is in sight!  Keep running towards it and finish the race strong! Let's all keep our minds on eternal things because the earth and all it's systems are passing away....and when it happens it could happen VERY quickly....after all, FAITH can vanish in an instant.

Remember, the Bible tells us twice that a day is coming when massive amounts of wealth will vanish in ONE HOUR and never be recovered again!  ONE HOUR!!!

Revelation 18
7-In one hour your doom has come!’

10-In one hour such great wealth has been brought to ruin!’

"But Dennis, that could never happen to America....because this is America!"

I wish you would quit saying that!!  Could you please come up with another comment?!