Bob Chapman Friday Economic Report: Fed Wealth Grows While Others Drown In Debt

Bob Chapman Friday Economic Report: Fed Wealth Grows While Others Drown In Debt

December 1 2010: The Fed grows richer at our expense, Wikileaks news links, desperate things for desperate people, the clarion call of gold, black friday unremarkable, countries drown in the debt of other countries. The Federal Reserve's balance sheet grew a 4th straight week to $2,328 trillion, up $31 billion in a week. In May the balance sheet was $2,333 trillion.

Holdings of government securities totaled $901.24 billion, and rose $27.62 billion. Mortgage holdings were unchanged and Agency holdings fell slightly.

It might interest you to know that over the past seven years federal debt has doubled to almost $14 trillion. That is more than $100,000 for every American household.

It should be noted that combined expenditures on Social Security, Medicare and Medicaid are projected to account for 45% of primary federal spending. That is a rise equal to 62% of GDP to 185% in 2035. 70% of US Treasuries are held by private investors and once they start to realize the US is really broke the game is over.

On a European note, Germany cannot keep paying for bailouts without going bankrupt itself. Germany is drowning in the debt of other countries.

Assets under management in commodities hit a record high of $340 billion in October.

A very important event is that China and Russia are going to quit using the US dollar. This is big news. In spite of the current USDX dollar rally it will reduce demand for dollars and expedite the dollar's demise. Once the dollar rally, induced by European problems is over, the dollar should take out 74 on the USDX. Current US insolvency is being ignored as the five-euro zone PIGGS get gored.

In addition, we wonder whether even the strongest country, Germany, can survive the onslaught of the 5 PIIGS and their financial problems. The Germany people are very upset that they have to bail out these Club Med countries. The US has the same problem with large liberal states with vast amounts of illegal aliens that are broke and will have to depend on the federal government for perpetual funding. Accompanying that funding will come further Federal control.
http://theinternationalforecaster.com/
http://www.infowars.com/
http://www.prisonplanet.tv/