Prophetic message in 2006 predicting 2009 Chernobyl economy

Bush's Chernobyl Economy; hard times are on the way

The country is now facing a Chernobyl-type meltdown and there's nothing we

can do to stop it.



By Mike Whitney



In the next few months, a

financial crisis will arise somewhere in the world

which will jolt the

American economy and trigger a

swift and precipitous decline in the value

of the dollar.



This is not speculation; it will happen and there is nothing that the Bush

administration can do to stop it.



All of the traditional supports for the dollar have been removed by a

shrinking economy, a massive $800 billion account deficit, dramatic

increases in the money supply, and the reckless manipulation of interest

rates.



Now, the noose is tightening. Our foreign trade partners can see that we

are bobbing in an ocean of red ink and are refusing to buy back our debt

in the form of US Treasuries. This is a death sentence for the dollar. It

means that in a matter of months the once-mighty greenback will crash

through the floor and free-fall through open space.



Mike Swanson of the WallStreetWindow explains the worrisome details

related to last month's trade deficit:



"Just a few days ago the US Treasury reported that the net capital inflows

from the rest of the world into the US fell for a 6th month in a row.

Private from abroad fell to $34.7 billion in August and from $72.9 billion

in July. Asian central banks made up for the shortfall. If they hadn't the

current account deficit would have exploded. The NY Times quoted Ashraf

Laidi, a currency analyst at MG Financial Group as saying, "foreign

central banks saved the dollar from disaster. The stability of the bond

market is at thee mercy of Asian purchases of US Treasuries."



Swanson poses an interesting theory, but it can't be verified since we the

Fed stopped printing the M-3 which would provide the relevant facts about

the current cash inflows.



Jim Willie of GoldenJackass.com, offers an entirely different theory in

his recent article "Spent Dollar Momentum". Willie opines:



"Behind the scenes are the many illicit London-based firms busily buying

US Treasury Bonds with freshly-printed money from the Dept of the

Treasury. Their tracks are covered by the blackout on the money supply

statistic. (M-3) An isolated US government with a well-oiled printing

press as the primary support device makes for a dangerous currency

situation."



Willie's theory jives nicely with the US Treasury's figures on the

"Foreign Financing of US Government Debt" (June 2006) Surprisingly,

between 2005 and 2006 our friends in the United Kingdom purchased another

$142 billion of USD bringing their stockpile of dollars to $201.4?!?



Why?



Why would UK investors suddenly stock up on dollar assets when everyone

else in the currency market is moaning about the greenback's systemic

problems?



Could it be that banks in the UK are just hiding the paper trail for

friends in America who want to forestall a collapse in the dollar until

after the election?



Of course there is another explanation for the irregular activity in cash

inflows, (purchase of US Treasuries) that is, that we're still living in a

"faith-based" Wonderland where foreign trading partners are only too happy

to buy an endless supply of worthless paper from a well-meaning giant who

is busy spreading democracy to the "great unwashed" in developing world.



Of course, that is an utter fiction. The world is backing away from the

dollar and dollar-based assets while the Federal Reserve attempts to

conceal the details until we get through the election-cycle. It's that

simple.



There is nothing accidental about the crisis we'll soon be facing. The

officials at the Federal Reserve and the US Treasury are fully aware of

the devastating effects of massive trade deficits, increasing the money

supply, and interest rates. They have set the country on the path to ruin

as part of a broader scheme for remaking the global-system according to

well-known precedents. In truth, the plan to modify the present system has

a long history; going back to the 1980s when many of the same actors in

government today were in positions of power in the Reagan administration.

For the last 6 years they have been patching together their strategy;

producing record deficits, unfunded tax cuts, mammoth government

expansion, and doubling the money supply.



Who can possibly argue that they did not understand the implications of

their actions?



Did Greenspan know that by lowering interest rates in 2001 to 1.5% that he

would sluice trillions of dollars into the real estate market producing

the largest equity bubble in history? And, if he didn't know, then how is

it that the Fed provides the statistics which actually tell how large the

housing bubble is?



Can't Greenspan read the charts and graphs his own organization puts out?



And why did Greenspan support the "no down payment", "interest-only" loans

and ARMs which allowed "high-risk" people to qualify for mortgages when

the Fed knew, according to their own figures, that if interest rates went

up, foreclosures would skyrocket?



Of course he knew; they all knew. How could they NOT know? They produce

the facts and figures themselves! It's all part of a madcap scheme to

shift wealth to the top 1% and drive a wooden stake into the heart of the

middle class. When Greenspan saw that doomsday was approaching, he got

"cold feet" and bailed out. Now the scholarly Bernancke is left to

supervise the economic meltdown and face the public scorn.



Trouble Ahead



Currently, the U.S. economy is held together by the slimmest of threads;

literally duct-taped together by massaging all of the crucial economic

numbers, pumping as much cheap fiat-currency into the system, and by

"increasingly-suspicious" maneuverings in the futures markets. After the

elections, they'll be no reason to conceal the rot at the heart of the

system. After all, we are not facing an unforeseen catastrophe, but a

planned demolition intended to increase the disparity between rich and

poor to such an extent, that democracy, as we know it, will no longer be

possible.



Nothing is more repugnant to America's ruling elite than the notion that

every man, however broke and insignificant, can participate in our system

of government.



The Federal Reserve's bloody fingerprints are all over our present

dilemma. The privately-owned Fed has never operated in the public

interest. By doubling the money supply in the last 7 years and keeping

interest rates artificially low, the Fed has generated a $10 trillion

housing bubble while, at the same time, ignoring a $800 billion trade

deficit which is sucking up American assets and crushing American industry

at an unprecedented rate.



This massive expansion of debt has increased the likelihood that an

unexpected event, like a bank failure or a teetering hedge fund, will

cause a major disruption in the markets sending tremors through the global

system. Even if nothing explosive happens, the faltering real estate

market will continue to swoon, consumer spending will dry up, and the

fragile economy will crash to earth. In fact, this is taking place right

now; retail sales are anemic, residential housing dropped a whopping 17%

in the last 3 months, and economic growth shrunk to a measly 1.6% in the

third quarter. The only thing keeping the economy from collapsing entirely

is the sudden drop in oil prices which "conveniently" coincided with the

midterm balloting.



This won't last. According to industry analyst Matthew Simmons the world

production of oil may have already peaked setting the stage for a

leveling-off period before the inevitable decline. Simmons has data to

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