“If You’re Older Than 40 And Reading This…’
by Karl Denninger
“…you’re likely to either be eating out of a dumpster in your old age or be (literally) eaten. If you currently have counted more than 65 revolutions around the sun in your life then you may avoid this, but only through the most-macabre of means: you’ll die of something else first.
Let me explain: If you’re between 40 – 65 you have somewhere between 20 and 45 years remaining on this planet, statistically speaking. Oh sure, some of you will do better, some worse, but those are the numbers. This means you must manage at least 20 years without things going to hell if you’re on the older end, and 45 years if you’re on the younger. What are the odds?
Well, the US Government (backed by the Fed) in what has been and continues to be described as a “recovery” destroyed about 6.3% of the value of the currency last year alone. That is the value of every dollar that exists in currency and credit (that’s a stunning $59 trillion dollars folks!) was impaired by 6.3%.
To put this in perspective and real dollar terms that is $3.7 trillion dollars of value destruction or approximately every penny the federal government spent. Looked at another way the Federal Government emitted $1.08 trillion to cause that currency destruction but the reality of arithmetic turned the harm done from $1.08 trillion to $3.7 trillion, a multiplication of 3.43x!
Now let’s look out 20 years. Let’s presume that this year, which the CBO and other policy people say will in time be considered a good year, is equaled every year for the next 20. That is, we have no more bad years (of which the CBO says we will have many, starting in another 2 or 3 and continuing thereon forever!) I’m being very optimistic in this projection, in other words. That $59 trillion is going to have a real value of $17.3 trillion in today’s dollars 20 years from now; it will have had roughly 70% of its real value literally burned to ash. With the remaining value we will try to pay Social Security and Medicare benefits, just to name two, without which about half of the population is literally without funds- or medical care.
Do I need to tell you how much is left in 45 years? Ok, I will: $3.78 trillion. Yeah.
If you want to know why the American consumer (that is, the common man) has watched everything go “poof” in front of them since roughly 1980, this is the reason. Contrary to the protests raised by various people in government that “we’re not really in deficit trouble” and similar nonsense this is the arithmetic that cannot be evaded; math isn’t a topic of debate, it just is.
Will I be ok when this happens personally? Maybe. But if not that’s all right; I had a pretty decent run, and if the reality of the situation is that between my attempts over the last number of years to get people to wake the **** up and put a stop to this crap fail and I also fail to find a way to remain in reasonable comfort as my time on this planet (probably another 35 years, more or less) draws to a close I have no quarrel with the fact that I’ve had a good run and due to that failure to change trajectory my time has expired.
How do you feel about this? More the point, whether you’re rich, poor or somewhere in the middle unless you’re ridiculously rich (as in, “have billions”) having six percent of your wealth today in real terms left 45 years out means you will be eating out of a dumpster and living under a freeway overpass- which will likely be crumbling around you in a vista something akin to “Fury Road”!
Oh, I know, you’ll call me a “downer” and say that “we’ve always found a way”, “technology will save us” or “the markets will go up monstrously and thus you’ll outrun it.” Uh huh. The markets have not outrun it from 1980 to today. They have papered over it with more and more debt, but eventually that debt has to be paid and in the meantime it has to be serviced. That servicing cost eats more and more of the productive output of society until it exceeds income at which point all of that hidden value destruction is revealed.
2000 and 2007 were a small piece of the overall economy and market detonating in this fashion. Small! Yeah, I know, housing was a big deal. No argument. It was much larger than the tech wreck as a percentage of the economy. But as a percentage of the whole neither was all that large.
Fixed residential investment in 2007, that is housing, the year before it all went to hell totaled $688 billion out of $14.478 billion in GDP or 4.8% of the total.
Got that folks? Less than 5% of the entire economy blew up everything, threatened to destroy the entire US economy and every large bank (according to Bernanke, Paulson .et.al.), caused the S&P 500 collapsing from 1576 to 660 (a loss of about 60%) and was only “arrested” by a literal doubling of federal debt and allowing banks to lie about the value of what they held, a lie that continues today.
Today, one dollar in five, or four times that much in percentage terms is spent on health care throughout the United States in a monopolist, rigged system that is more unstable by several orders of magnitude and more dependent on federal intervention and tampering with the value of our currency and credit than the housing market was!
The solution to said problem is right in front of us yet nobody will even discuss it at the political level, say much less introduce a bill. State governments, for their part, will (if pressed) tell you there is literally no agency that does or will take up even blatant behavior that ought to be considered a criminal violation of consumer protection statutes if it occurred in the medical sector. Medicine isn’t the only place this problem exists, but it’s the most-critical to resolve simply due to its size as a percentage of the economy.
I don’t know how much time we have before ordinary people- or for that matter just traders- figure this out at a critical mass level. I have no idea if it will come before or after the majority of the nation is scavenging dumpsters for something to eat.
But I do know the math tells me a meltdown at a scale four to five times greater than any we’ve seen in this nation’s economic history, including 1929 and 2008, is inevitable unless we stop this and with every day that passes the amount of accumulated damage that there is no way to evade grows at an ever-increasing, indeed exponential, rate.”
“Today, one dollar in five, or four times that much in percentage terms is spent on health care throughout the United States in a monopolist, rigged system that is more unstable by several orders of magnitude ”
I agree. If that problem alone were corrected…the government wouldn’t need to step in and aid those in need. Just so you know….I often get double billed by my local hospital…..and then am left to prove that my insurance paid the bill. Once I call and give the day and payment confirmation code of payment…the hospital demands that I prove the insurance company “didn’t rescind the payment.” (Everyone knows you can’t prove a negative.)
So, I have to then get my Big, Bad insurance company on the line with the hospital…..
I have found that medical bill collectors are akin to any kind of bill. They will bill you a hundred times, take a hundred payments in full….and send a hundred more bills of collection if they can get away with it……Crooks, ALL.
Thanks for saying what should be said every day until it’s corrected.
Crowpie you got it. the older people in Western societies and those who need medical help at regular intervals (chronically diseased and disabled people) have become prey to
a whole lot of crooks
among medical and paramedic companies and persons, also in Germany.
The medical insurance companies are the biggest crooks. They play tricks upon their clients to avoid paying for them and to constantly raise their monthly fees. They really are a shame.
furthermore, in our country,
Government is seeking ways to get hold of larger portions of heritage money than before.
Both medical industry and Gov´t know that there is a lot of money in the hands of the elderly
and that it is quite easy to get it out of them,
for most of them are too honest (or naive) or too disabled to circumvent the many bureaucratical and marketing tricks used to sell bad service for good money, not to mention the informational deficiencies they have.
The elderly function according to the rules of the decades when they were young grown-ups, that´s a fact.
They can´t follow today´s rapid technical evolution
and they can´t realize the manipulative changes in political and business language (“Newspeak”)
that have distorted the meanings of many common words, sometimes even to the opposite…
Old agers be wary. Sometimes the truth is contrary.
Since massive debt accumulation makes financial collapse VERY likely
And Obama seems to be intentionally spending America into collapse
(and many economic pundits and Bible prophecy authors point to a time around September 2015)
maybe we should expect chaos, hyperinflation, martial law, dictatorship, and the fulfillment of end times prophecy… and cannibalism? Read -
Antichrist 2016-2019: Mystery Babylon, Barack Obama & the Islamic Caliphate –
http://www.amazon.com/Antichrist-2016-2019-Mystery-Babylon-Caliphate/dp/1501025392
Humm….
Jesus is coming soon to judge America. Those left after the destruction will soon be ushered into the New World Order and forced to worship the Antichrist who will rise out of nowhere and will claim to bring peace to the world. All Christians, Jews, Muslims will be considered enemies of the Order and will be persecuted then exterminated… Be prepared to live in FEMA camps to be controlled. Those left will be forced to take a mark or device either in or on their body as no one will be able to buy or sell anything without it. Trust Jesus as your personal savior and repent of your sinful life. Jesus is quick to forgive.
John 3:16 For God so loved the world (you and I) that he have his unly Son (Jesus) that whosever (You and I) would believe in him, he or she would not perish (go to Hell); but have eternal life (afterlife with Christ in Heaven)
God is waiting until the appointed time (which no one knows but him) to release judgment on the Earth. Time is short; DON’T WAIT UNTIL TOMORROW TO ACCEPT CHRIST… He could come at any time. DON’T BE FOUND an unbeliever.
Yeah, lot of people been say’ n got about 20-30 years left. It is my belief also. But they will pile debt upon debt and to get by it and just ignore it and PRINT more money without a care in sight.
So, when the crash comes it will be horrendous and multiplied by its own weight. It will like nothing you have ever seen. I think they call it the Tribulation and watch out if it is combined with both man-made and nature-made disasters.
One reason is the world did not practice the function of Jubilee Years. That means there is an inbuilt system that does not recognize debt when in fact it is very real and built in.
So great SHALL BE THE CRASH THEREOF……
If you want FREE medical treatment come to the UK – everyone else does :/