The current woes of the world economies is really not an unexpected occurrence. Have you ever wondered how countries can operate with huge budget deficits? Can you operate your household on a large deficit? Well, sort of with the use of credit.

Operating in the Red – Living On Borrowed Money - Money As Debt

But that raises the thought:
If governments operate on very large deficits (the United States deficit is over $1 Trillion) along with most business operating on borrowed money add in consumer debt (mortgage/auto/credit card/etc) where is all the money? All the “digital” money does not really exist. It is created digitally not physically. Money is loaned out based on money that is owed. This type of system is set to eventually fail from the start.

“Borrowing from Peter to Pay Paul” is what is actually taking place. Think about this… Let’s keep the numbers relatively small so it is easy to follow.
Total amount of money in the entire system  = $1,000,000.00 (one million USD)
Total amount of money loaned out on credit = $1,000,000.00 (one million USD)
10% Interest owed on total amount of credit  + $  100,0000.00 (one hundred thousand USD)
Total amount of money (debt) owed (P+I)       = $1,100,000.00  (one million one hundred thousand USD)

Now, let’s say the total debt = $1,1000,000.00 is called and payable right now. Is it impossible to pay? NO. Why? It’s really very simple there is only $1,000,000.00 Total Money Available, remember.
So, where will the $100,000.00 come from if it doesn’t actually exist. Think about the bigger picture.
Didn’t the Great Depression start from a “run on the banks”?

You be the judge:
A) Ponzi Scheme
B) Poor Management
C) Greed
D) All of the Above

And that is why our monetary system was doomed to fail from the very beginning and the sad fact is that the ones who oversee it – Knew It From the Beginning.

Watch this video as it will open your eyes as it sheds some light on this fragile house of cards that has been built. Something to think about. I think you’ll enjoy it.

A word about those “Banks” taking bailout money and then giving a good percentage of it away as bonuses…read more…

One of them, no names, took $10 Billion USD of bailout money. Then bonused out $10.9 Billion of it at the end of 2008. Pretty bad isn’t it, I mean how responsible is it to “need” and then take bailout money only to turn around and bonus more than that out. How would those same companies feel about you doing something like that? What words would be used to describe what you would have done? They need to practice what they preach but, that will never happen as they control the money. The goal of these same institutions is NOT to help the individual but, rather bury them as fast as possible.

You see the faster they can add fees and charges and keep you behind the faster they can run up the balances. Remember the total they run it up to isn’t what was actually borrowed nor does it take into account payments made previously.

In short the faster they can take $1000.00 and run it up to $1500.00 and then write it off, they get the tax break on the extra $500.00 in fees and charges.

One bank runs advertising on the radio, probably TV also, that states that they will transfer money from your checking acct, when you use your debit card, in to a “High Interest Savings Account”. Now I have to wonder what their definition of “High Interest” is? Well here it is: 5.00% first year, 2.00% after. Wonder what name they call their credit card rates by?

With the bleeding job market
“The US lost more jobs in 2008 than in any year since 1945 as employers fired another 524000 people in December, indicating a free-fall in the economy just days before President-elect Barack Obama takes office…”

It is now that one must start taking some sort of action. Putting in place Plan B. Before you are one of the lost jobs.

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