Germany Wants to Impose Tax to Pay for Refugees on All of Europe
German Finance Minister Wolfgang Schaeuble has called for a new EU-wide tax on petrol to pay for the refugee crisis that Germany has created. This is a EU-WIDE Continental Tax, not one limited to Germany. So now all Europeans must pay for a gross mistake Merkel made inviting the refugees into Europe. The people are always seen as an endless source to tax for the nightmares created by politicians. Just when will the people ever have a right to just say NO!
Why the Theory of Money Does Not Work
QUESTION: We see that the United States can borrow all it needs at minimal cost and we also see that we’re getting a big boost from falling energy/commodity prices, to levels we have not seen in some 15 years my “economic model” — which is not a computer model but is certainly scientific in nature — tells me that we will be humming along pretty nicely for quite a long while, minimum 5 years maybe much longer, given these two variables do you see anything on the horizon that will knock us off this “steady state” and quite favorable situation?
TP
ANSWER: You concept of the economy is very limited and is too influenced by the concept of the quantity of money/Austrian School. This is one-dimensional. Taxes play a huge role and provides the source of DEFLATION. If I give you $100 and then tax you $90, just how much did I really give you? The middle class is shrinking and they claim the 1% are making too much. Is that really the problem? No. The problem is the 40% (government) is broke and consuming a steady increase in the proportion of everyone’s income. Government produces nothing. It lives off of what everyone else produces. The more it grows, the lower the real economic growth.
You are only looking at the total aggregate. You assume simply increasing the quantity of money will produce inflation. That theory has been proven wrong constantly throughout the course of history. You must look at the growth of government and the larger it grows the lower the economic growth. Look at the City of Detroit. When more than 50% of its taxes went to pensions, it could no longer function to maintain the cost of government to operate currently and collapsed as those who could be taxes migrated from the city.
This same exact result manifested from the very beginning of the rebirth of government and taxes during the 15th century. Mainz was where the printing press was invented. The city went through a huge economic boom and the politicians borrowed against a future they assumed would never end. The more they raised taxes to pay for expenses, the more people left. They began issuing new debt to simply pay off the old debt as we do today. When they could not sell new debt, they defaulted. They were then invaded and the city was sacked and burned to the grown.
This outcome applies to all levels of government. Your “model” assumes that merely increasing the quantity of money defeats this reality. It does not and hasNEVER prevented the collapse of Empires, Nations, or City States. Undermine the CONFIDENCE of the people and you destroy your own economy. This is what we are in today. The hunt for money has begun and with it our freedom is vanishing before our eyes. The end is caused by the mismanagement and greed of government – not the 1%. They too ultimately become the target of government just as Philip IV of France imprisoned all the Italian bankers, then seized the Papacy and move it to Avignon, and then installed a French Pope to seize the Knights Templar and confiscate all their wealth. It is always the same story and plot – just the names change with time.
Edward Gibbon in his Decline and Fall of the Roman Empire, wrote: “Suspicious princes often promote the last of mankind, from a vain persuasion, that those who have no dependence, except on their favor, will have no attachment, except to the person of their benefactor.”
Edward Gibbon wrote of Commodus (177-192AD): Each
“distinction of every kind soon became criminal. The possession of wealth stimulated the diligence of the informers; rigid virtue implied a tacit censure of the irregularities of Commodus; important services implied a dangerous superiority of merit; and the friendship of the father always insured the aversion of the son. Suspicion was equivalent to proof; trial to condemnation. The execution of a considerable senator was attended with the death of all who might lament or revenge his fate; and when Commodus had once tasted human blood, he became incapable of pity or remorse”
(Book 1, Chapter 4).
When government turns against its people, the economy begins to shrink. Commodus was the son of Marcus Aurelius who marks the peak in the Roman Empire. From that point on, Rome began its fall. Government began to hunt money and assets. The population of Rome itself peaks and people began to then migrate from the city to the suburbs. You must also look at this balance between Public and Private. Therein lies the real key to the rise and fall of civilization – not the quantity of money.
Leverage v the Black Hole in Economics
QUESTION:
Dear Marty,
Please correct and expand my understanding of a Sovereign Debt Crisis as it pertains to leveraged accounts. If global economies are leveraged because of too much debt with no plans to pay, then what are the pros and cons to leveraged short investments when economies are deleveraging? Might they be dangerous at times?
Thanks in advance for your incredible knowledge and willingness to educate others wanting to learn and understand.
Sincerely,
BB
ANSWER: Leverage seems to be the buzz word everyone relies upon to predict the end of times. All we hear about is the leverage in derivatives and the issue that will collapse society. Quite frankly, that is a lot of hype. They are quoting the total gross without looking at the net because so much of this is offset.
Because of these scenarios, the predictions people tout is always inflation. They keep the German hyperinflation in mind even if they do not explain their base reasoning. However, LEVERAGE has existed since ancient times. Here is a Babylonian tablet recording the earliest futures market. Sorry, but LEVERAGE has been around a very long time.
Careful correlations of historical data we have gathered which even include the money supply determined by the number of known dies for coins and the average 25,000 coins which can be struck before a die breaks. When I say we put together the largest collection of coinage providing a complete run back to 600BC to recreate the monetary system of the world, it is no exaggeration.
We even have Roman dies that were used to strike coins shown above and to the right. You cannot ascertain what the future will bring without a road-map of the past. Forecasting the future demands a database – not merely theories. By assembling the hardcore evidence of history tracing the footsteps of humankind throughout the centuries, only then can you speak with any pretense of authority that is not qualified with “I think”.
The battle has always been not with LEVERAGE, but with Government. The larger government grows, the more wealth they consume. Government produces nothing, but they ultimately consume everything. This is why they ALWAYS collapse. We are in a DEFLATIONARY spiral because they continue to suck in more and more money. LEVERAGE only adds to volatility. Government is like a BLACK HOLE, sucking in everything including the light of the future. Nothing can escape until its collapses.
This is the present HUNT FOR MONEY because they are going broke. It is not the quantity of money that counts; it is what crumbs are left on the table at the end of the day. Government is indistinguishable from any criminal organization engaged in the “protection business”. You pay up to be protected or they themselves rob you.
Goldman Sachs fined $5 billion but is Still Above the Law
Goldman Sachs is finally paying a price (money) for the role it played in 2007 mortgage scandal, but of course nobody goes to jail proving Goldman still remains above the law. The Wall Street firm agreed to only a civil settlement of up to $5 billion with federal prosecutors and regulators arising from it marketing and selling of known faulty mortgage securities to investors they created. Goldman Sachsannounced:
Under the terms of the agreement in principle, the firm will pay a $2.385 billion civil monetary penalty, make $875 million in cash payments and provide $1.8 billion in consumer relief. The consumer relief will be in the form of principal forgiveness for underwater homeowners and distressed borrowers; financing for construction, rehabilitation and preservation of affordable housing; and support for debt restructuring, foreclosure prevention and housing quality improvement programs, as well as land banks.
The number one question we always get is why are the regulators and prosecutors so damn corrupt? Besides the bankers being in a position to blackmail politicians that if they are not bailed out, nobody will sell their debt, then the real problem is they buy the prosecutors and regulators. How? They hire the government lawyers who are suppose to be regulating them. This even includes staff of politicianswho actually write the legislation. This is known as the revolving door. It is different where Rubin and Paulson were CEOs of Goldman Sachs who then became Secretary of the Treasury and left after they did what they had to do for the banks. This corruption ensures that there will never be any real criminal prosecution of the bankers. They are indeed always ABOVE the law. Why not? They pay for that privilege and Congress will never outlaw the revolving door because they too want to be rewarded for their dishonesty since they know this is the game and they pretend it is an outrage but silently condone it for decades. This is why we can no longer afford career politicians. No matter what country, we need to get rid of career politicians to save our own future.
The movie the Big Short (I highly recommend seeing twice) has a scene where a girl from the SEC is seeking a job from Goldman Sachs when she is supposed to be the regulator. Then the rating agencies SELL ratings. For any other field it is criminal activity and called bribery. They too did not go to jail. It has become standard operational procedure for those especially in New York City.
In our case, the SEC lawyer who started the prosecution, picks the law firm for the receiver O’Melveny & Myers, and then quits the SEC and becomes a partner in the very firm he selected. There is case law on this that says this is illegal. Whenever I raised the point even to the Second Circuit Court of Appeals, they just ignore it. Law isONLY for those of us who never worked in government. Everyone else, we are the food the legal system feeds on to pretend they are protecting society when they prey upon it.
The receiver Alan Cohen seizes all the tapes and evidence we had on criminal activity among the NY banks documenting every manipulation of markets, and then protected them. I believe he was rewarded and given a board membership at Goldman Sachs, yet NEVER resigns from the court. So he worked for the court running Princeton Economics from the boardroom of Goldman Sachs. Another amazing conflict of interest the judges would never address.
Perhaps we should change our name to Goldman Sachs, Jr. and that way any fines you pay are also tax-deductible when nobody else gets that privilege and everyone is exempt from prosecution. Interesting when government prosecutors come with their own price tag.
Even after pleading criminally guilty last time, the NY bankers were given not just aGet-Out-Of-Jail-Free card, the SEC, who should have taken their licenses, exempted them. So when they talk about preventing felons from various things, of course the bankers are felons, but are always exempt.
Constitutional Judge Warns Merkel is Violating the Constitution
German Federal Constitutional Judge Udo di Fabio says the German federal government is constitutionally obliged to take control of border security when European institutions are impaired. Judge Fabio correctly stated:
“The Basic Law does not guarantee the protection of all people worldwide through de facto or legal entry permits.”
The constitutional duty of any head of state is to only his own jurisdiction. There is no legal basis for anyone to invade another country based upon their perceived violation of human rights against that nation’s own people. Likewise. no head of state has any constitutional authority to waive the protection of their own people to protect the people of some other state. These are basic legal principles. Anything else assumes the RIGHT to invade other nations, which does not exist.
This is a message that Merkel is acting far beyond her constitutional authority but the same principles apply in the United States, but we lack judges with integrity. Judge Fabio agreed with Thomas Jefferson that when a government fails to comply with its constitutional mandate, the people have GOD GIVEN RIGHT to revolution. Judge Fabio stated: “All Germans shall have the right to resist any person seeking to abolish this constitutional order, if no other remedy is available”.
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