We are witnessing the Reagan piñata exploding, and it's not candies
what's hitting your face...!? Starting in 1980, the "Reagan-Thatcher
Revolution" promised an unrivaled era of fast-gains, where miracles
happened out of thin-air, fueled by discarding real economic growth
defined in terms of actual PRODUCTIVITY, and substituting this for
the get-rich-quick schemes of sheer "FINANCIALIZATION".
In other words, the US economy gradually morphed into a "paper &
monetary" machine, irrelevant of actual Productivity processes; now
the focus was on "Instruments of Financial Gain", and right-wingers
proclaimed a new era of unstoppable constant growth forever & ever.
A vast majority of the population bought into the dream, and voted in
3 consecutive republican terms. But already by 1992 the dream was
seriously becoming a nightmare; enter the Clinton-Gore team, and
an adapted-dream of recovery was enacted for 8 years with a rather
unparalleled success. Yes they recovered the IMAGE of the dream,
convincing most of the entire globe that we were still the most sound
economy, thus the entire world economies invested their gains into
the US stock market and treasury bonds and so forth. We literally
were swimming in everybody else's money.
Practically all nations decided to put their Pension Funds into the US
stock market; this month, Argentina had to Nationalize the private
healthcare system, because pension funds had lost more than 40%
their value due to the current economic meltdown in the US.
In the US there are 158 MILLION credit card holders; the financing
industry has succeeded in giving them 1.5 BILLION credit cards,
-you read that right- aprox. 10 credit cards per person on average.
Yet currently more than 5% of credit card debt is going into default,
with an expected 20% of it becoming delinquent (in the conservative
predictions of the financial banking industry itself).
One of the largest credit banks in the world -Capital One-, just had
to write-off $1.9 billion in bad debt in the last quarter of 2007. We
know that at least $17.3 billion credit card debt is currently more
than 30 days late in payments, and climbing.
The Bush administration managed to obliterate any resemblance to
"responsibility", as credit card debt grew a whopping 435% during
the 2000 and 2007 years, from $211 billion to $915 billion.
The US population savings rate has hit negative (below zero that is),
and on average homeowners owe more on their homes than they
have in equity. Question is: how then could credit card companies
continue to give credit to the US population, in this context...?
The answer is double; on one hand, the Bush administration just
plain LIED TO THE AMERICAN PEOPLE about the true state of the
economy, fixing and altering economic data at will while simulating
a state of unimpeded growth (a "feeling" sold to consumers through
widely available irregular house loans), in order to keep clinging
to their power stronghold and their delusional world domination
obsessions, as on the other hand they continued to impinge upon
the financial system the wreckless and corrupt DEREGULATION
OF THE BANKING INDUSTRY initiated by Reagan. Translated:
the George Bush administration lied & cheated at the top (banking)
as well as at the bottom (consumer confidence). This was deemed
as "necessary" for the geo-political "goals" of fighting endless and
protracted WARS; you as citizen needed to be distracted by your
own personal new credit scams -and illusions of prosperity-, so that
nobody would notice how the whole system was nearing its end, &
that we actually did not have the money to fight wars, even as the
government itself borrows it from China to make wars possible.
"Have a brand new mortage and more credit cards...!" was the
glorified delusional mantra, to stop you from becoming aware of
the impending economic doom. It became trendy to own 2 or 3
houses; meantime Dubya was busy legislating how to protect credit
card companies from you the consumer, passing the Bankruptcy
infamous Bill, royally screwing you up.
It was the most evil & deceitful policy of "SHOP & CHARGE TIL
YOU DROP", and then when the s*t hits the fan, Bankruptcy will
not protect you anymore, now. The inherent perversity of all this
is what must be stressed; these were not simply "cyclical" trends
of usual ups & downs, these were deliberate destructive agendas.
A complicit Congress during the 1990's had vastly deregulated the
practices of financial service companies, and the stage was properly
set for the biggest piñata in known history.
Which is the current economic meltdown; now we have almost $1
TRILLION in unpaid credit card balances, the stock market has
lost nearly $7.7 TRILLION, more than 2 MILLION homes are
sitting vacant in the US, last year consumers added $7.8% more
debt to their credit card lines -$68 BILLION-, the largest increase
in 7 years. And the piñata party is not even in full gear yet...!?
This means that the real estate mortgage crisis was but the 1st.
leg of a financial meltdown, the 2nd. leg being the impending credit
card crisis, which will hit the population the hardest, since most
credit card holders are simply paying off their credit debts charging
another credit line, in a revolving scheme.
And most grave of all, it is expected for the US government to start
defaulting in servicing its external debt, by the summer of 2009.
What will international creditors like China do in response to this,
is anyone's guess. However what we DO KNOW, is that the current
administration has been busy trying to KICK-START World War
III, to create the conditions for this default in payments, in such
a way that we can "feasibly" get away with it amidst global chaos,
turmoil and destruction.
This giant nightmare, is the legacy that the Reagan "revolution"
and the Bush administration is passing on to both us the population
at large, and the governments that must follow on, for generations