IPFS Jet Lacey

More About: Economy - Economics USA

The Economic Crisis and Why it's Happening Part II

The Economic Crisis and Why it’s Happening Part II: Deflation, Hyper-inflation, and a Call to Action

March 3, 2009

By Jet Lacey

Now that we have started down the path and we are beginning to understand what is happening and why, we will now delve into how the economic crisis will ultimately affect your everyday lives.  Again, I am going to do my best to describe it in layman’s terms. This will not be an easy read for many of you because denial is a powerful defense mechanism.  I absolutely loathe being the bearer of bad tidings, but with rapid action I will help you to keep your freedoms intact.  The essence of this article is: 

In the very near future, off-the-grid self-sufficiency will undoubtedly equal freedom.

But I digress.  The fact of the matter is that whether or not you subscribe to the Keynesian theory of government intervention (spending) to reinflate a faltering economy, it simply will not be sufficient to return us to prosperity.  It is the same as pouring gasoline on a fire to put it out.  Our government was effectively insolvent before the crisis occurred.  Social Security, Medicare/Medicaid, and rampant spending by the Federal government, especially on the war in Iraq, have only hastened what was already inevitable (see central banking in part I).  Unfunded mandates, government regulations that require states to act or uphold certain standards without providing sufficient money with which to do so, are also a big problem.  Among these are the No Child Left Behind Act, and various and ever multiplying Homeland Security mandates.

I will say this again:  The economies of the United States and the world are terminally ill and they are breathing their gasping, dying breaths. However, behemoth of this size does not die overnight.   

The sooner you come to realize this, the sooner you will be able to get your house in order so that you and your families will be prepared to weather the crisis.  However, let me be perfectly clear; I am in no way saying the world is coming to an end, I’m saying that the ways we have been doing things are coming to an end.  We will need to be able to react appropriately in a rapidly changing and fluid environment in order to continue surviving and thriving. I recently read the text of a speech given by Dmitry Orlov in San Francisco on February 13th entitled “Social Collapse Best Practices.”  In the speech, Mr. Orlov explains the vast similarities between our collapsing economy and the complete collapse of the Russian economy after the fall of communism.  By glimpsing into recent Russian history, we will be better equipped to handle our near future.

Now that we’ve examined what has caused the crisis and why, we can now look into ways the inevitable collapse might unfold.  To achieve this, we will look into various economic situations that may occur and how they would affect your daily life. We will focus on the possible emergence of deflation, hyperinflation, stagflation, the collapse in the dollar as a currency, and the emergence of a new system of banking and governance in America. 

Deflation, as one might assume, is not the plague befalling tires everywhere.  Deflation is the opposite of inflation.  Whereas inflation is a general increase in prices and wages and a decrease in the value of the currency, deflation is a general decline in prices and wages and an increase in the value of the currency.   While falling prices are a boon to individual consumers, it can signal something much more ominous in an economy.  Deflation occurs when there is a decrease in the aggregate demand for goods and services, and it is often caused by a decrease in the supply of money or credit.  In other words, it is when the levels of supply are greater than the demand.  Deflation causes companies and businesses, because they’re not selling enough of whatever they produce, to decrease production and therefore contract, leading to layoffs.  An episode of deflation does not always devolve into a deflationary spiral, but when it does, it is a far more dangerous and devastating situation.  A deflationary spiral is when wages and prices rapidly decrease and there is a rapid increase in the value of the currency.  It is seen as a sign of a worsening recession. 

It is commonly understood that we are in a deepening recession.  According to Keynesian economics, the economic theory followed by the Federal Reserve and banking industry, the proper course of action is for the government to print and throw money at the problem.  However, as I pointed out above, the United States is already effectively insolvent.  The printing press is working overtime, and our National debt, including unfunded mandates, Social Security, and Medicare/Medicaid is equal to the world’s Gross Domestic Product (GDP), or the output of the entire world for a year.  That amount of the national debt is the staggering sum of 65.5 trillion dollars.  The government purposefully omits certain statistics when reporting the National debt to the public. 

To tie it all together:

The worth of fiat money is related to the faith and good credit of the issuing nation, but the United States is effectively insolvent.  We are in a deepening recession because there has been a continuing decrease in the aggregate demand for goods and services, and a there is a continuing decrease in prices and wages, signaling deflation.  The Federal Reserve, following Keynesian economics, is printing fiat currency at a rate never before seen.  Adding insult to injury, President Obama has proposed a 2009 budget with a further 1.7 trillion dollar deficit with no end in sight.

We are already technically insolvent with a debt load that we can never repay.  And as we continue to print money at an unprecedented rate with compounded debt attached to it, someday soon (very soon) we will no longer be able to service the interest on the debt and we will then default.  When we default and our credit is no longer good, investors and governments will rapidly abandon the US dollar, and our money will become increasingly worthless, which will cause prices to skyrocket.  This is hyperinflation. 

This is the main reason I have been encouraging people to abandon their 401k’s and the stock market while they still can, because it won’t matter if someone has a million shares of IBM if the dollar ends up being worthless.  If their shares are in dollars, their shares will be worthless.  This is part of the scam because the businesses’ infrastructure will still be in place, ready to be bought up at a fraction of the company’s true worth. 

Another possibility to look at is Stagflation.  Stagflation is when deflation and inflation occur at the same time.  In stagflation, the economy deflates, but unemployment and prices continue to rise.  This is also considered to be a very bad economic sign.  Gerald Celente, the #1 forecaster in the world, believes that we are in for “the Greatest Depression,” and has coined the term Hyper-Stagflation; a term that means the economy is pretty much cooked. 

So what will happen if the dollar does collapse?  The answer to that is both complicated and devastating.  For one thing, if our currency collapses, many countries and their currencies will collapse along with the dollar because our economies are so intertwined.  Secondly, purchasing the most basic foodstuffs and necessities, if they are even available, will be priced out of the reach of most people. 

A Call to Action

What would you do to survive if the store shelves were empty?  What would you do if you simply couldn’t afford to buy what was available?  You’d be in a really tough spot right?  By taking steps to ensure you and your family have food to eat, regardless of the economic climate, can mean the difference between freedom and enslavement.  If you act now, the fix is pretty easy; especially during this deflationary period when prices are low.  That is why I encourage you, in fact I beg of you, to purchase as much non-perishable food as you possibly can, and to plant a garden.  In the United States, 95% of the population is absolutely dependent on the availability of stocked grocery store shelves for our provisions.

If you are unable to provide for yourself, FEMA is more than ready to take you in.  The US Army Northern Command (NORTHCOM) has 20,000 Iraq and Afghanistan-hardened troops that are prepared to engage the American people and numerous FEMA camps are fully constructed and ready for you should the situation get out of hand, which many (including the IMF Bank) are predicting will come to pass. The FEMA camps are like roach motels; you go in freely but you can’t leave freely.  FEMA has also hired 26,000 pastors as “Clergy Response Teams” to encourage their flocks to accept relinquishing your weapons, martial law, and going to the FEMA camps.

In the very near future, the responsibility for your freedom will ultimately fall on to your own lap.  This is why I say that self-sufficiency will equal freedom.

I realize that I may turn some people off when I speak of the push for world government by the banking and corporate elite.  But I ask you, why does it bother you?  Is it because of denial?  Is it because you can’t imagine anyone is so evil that their aim is to create a single world government, a single world bank, and a cashless society? Is it because you cannot imagine anyone would be willing to stage false-flag terror attacks or manufacture a world economic crisis to achieve that end?  Is it because you just can’t seem to wrap your mind around the concept that a small but sinister group of elites, who have everything they could ever possibly want, have a sincere wish to rule the world and enslave you with surveillance, debt, and taxation, and they are on the precipice of achieving that goal? Well I suggest that you get used to the idea if you don’t want to end up as someone else’s property. 

Again, this is not a conspiracy, it’s an AGENDA.  The New World Order is very nearly a reality.

The New World Order is mentioned in the news every day. They are preparing us to accept it. Now, more than ever, is the time to understand what the Declaration of Independence and Constitution really mean before it’s too late.  I urge you to read them again and familiarize yourself with the words and their meaning.  They are the greatest documents ever written in the history of mankind. The belief that individual and the protection of their rights is the government’s primary responsibility.  The founding fathers believed that we are born free, that freedom was a right bestowed upon us by God and not to be bestowed or taken away by government.  But, with rights come responsibility, and you are ultimately responsible to ensure that your rights are upheld.  If you don’t stand up demand your rights, someone is always waiting to take them away. To quote a friend of mine, Ed Vallejo;

Rights are like muscles, if you don’t exercise them they atrophy.

If I believed that the cause was already lost, I wouldn’t put forth the effort; I’d make like John Galt and get out of here tuit suite.  However, I believe in America and I sense that a massive groundswell is rising.  Many of us don’t realize what we have until it is gone or almost gone.  Once it’s gone, it’s too late.  It’s not too late right now, but the hour is certainly getting late.  For ourselves, for our children, and for our future generations, please step up and don’t give up on liberty.  By protecting yourself, you are also protecting the liberties of others.  Other than life and love, liberty is the most important thing we can experience.