This is really an excellent article! The only thing left out was California sliding into the Pacific (in fiscal/economic terms) and we are reminded that a loss of THAT magnitude alone would slide the rest of the US into depression....And there are at least 10 states on the brink.

Re Goldman Sachs, the great criminal banking corporation that has infiltrated so much of the economic/fiscal framework GLOBALLY (not just in the US) with commodities (gold/silver) price rigging from New York to Tokyo, we should add that GS is ALSO running our central bank, the BANK OF CANADA, in tandem with the US. Carney, our new Bank of Canada governor is a Goldman Sachs man. So, how's our dollar doing? Well comparatively speaking (compared to Dodge), not nearly as well as at least the competitive devaluations against the USD are doing fine for manufacturers and the US system. Just not very well for the bank accounts of Canadians.

This is a process that is usually hard to see in that it is not reported on by the mainstream press. Never. Any commentary about the symptoms, as at TVO (our form of PBS), for example, tend to be aimless and lack direction because the discussions never focus on currencies or do they grasp with any firmness the subject of fiscal mismanagement...I continue to wonder why as this ties in all those falling out loose ends - and is a wonderful segue to a lot of the geo-political turmoil developing. We do not seem to have a free press anymore too....Or a very selective one.

Is our news even discussing California? So I Googled out "Toronto Star California" and found that they have done only 2 STORIES ABOUT IT!!! The fall of California should be one of the stories of the decade! We (I, at least) hear NOTHING! Ever wonder why not?

So tying this together, we have two schools of thought (in our community of fiscal junkies) on the Decline of the US Empire: 1) that it will be over in months or 2) it will take 15-20 years. As this will be measured by the decline (on the FOREX) of the USD, I doubt this will take years. All one really has to do is take a historical USD chart and draw a line joining the tops of the recent highs. This is doable as 1) the USD has fallen out of the channel to the downside and should fall as hard as it had risen (redemption rally) in 2008-2009 to its previous low of around 71. Then it should rest and go sideways as it has at the last 80 point before resuming...I cannot paste in the chart but suffice it to say that it will be poised to fall through 71 at the earliest around Christmas...or into the early spring. (And this syncs well with Sinclair's countdown!) Once it passes below 71 there are no resistant points and it should decline according to Fib rules to hit a bottom....SOMEWHERE in there it will lose its world trade settlement status,,,,and it will be clear to most US citizens that there is something REALLY wrong...And that without any news commentary at all.......Timeline for this is very late 2009 or the first half of 2010. If the news media is not going to talk about California even up here, it simply means that less is being said down there and THAT means that each US citizen who is unaware of what is happening will one day will wake up and he will have an epiphany of doom. I suspect that the learning curve for the willfully complacent will occur within weeks of each other and the US citizenry will wake up ANGRY as this process gathers steam!

In socio-economic terms he will awake to a free-fall of personal finances, and a realization that the White House is corrupt and has betrayed him....What this means is that politically the control of Obama by the banking cartel will destroy the institution of the presidency and THAT central government will have no credibility with its own citizens...It is at that point,,,,that the people will begin to react with civil disobedience...Disillusionment in the presidency will likely be terminal and that will bring home the fact that they are not living in a country that they thought they were. The citizens will know that their government AND presidency has been captured by racketeers! It will be at that point that the US will morph into the fascist entity that it has been courting these past ten years.

All, of course, FWIW.

Paul Craig Roberts: What economy? There's nothing left

Submitted by cpowell on 09:38PM ET Thursday, July 16, 2009. Section: Daily Dispatches

By Paul Craig Roberts
Counterpunch
Thursday, July 16, 2009

The real economy was traded away for a make-believe economy. When the make-believe economy collapsed, Americans' wealth in their real estate, pensions, and savings collapsed dramatically while their jobs disappeared.

The debt economy caused Americans to leverage their assets. They refinanced their homes and spent the equity. They maxed out numerous credit cards. They worked as many jobs as they could find. Debt expansion and multiple family incomes kept the economy going.

And now suddenly Americans can't borrow in order to spend. They are over their heads in debt. Jobs are disappearing. America's consumer economy, approximately 70 percent of GDP, is dead. Those Americans who still have jobs are saving against the prospect of job loss. Millions are homeless. Some have moved in with family and friends; others are living in tent cities.

Meanwhile the U.S. government's budget deficit has jumped from $455 billion in 2008 to $2,000 billion this year, with another $2,000 billion on the books for 2010. And President Obama has intensified America's expensive war of aggression in Afghanistan and initiated a new war in Pakistan.

There is no way for these deficits to be financed except by printing money or by further collapse in stock markets that would drive people out of equity into bonds.

The US government's budget is 50 percent in the red. That means half of every dollar the federal government spends must be borrowed or printed. Because of the worldwide debacle caused by Wall Street's financial gangsterism, the world needs its own money and hasn't $2 trillion annually to lend to Washington.

As dollars are printed, the growing supply adds to the pressure on the dollar's role as reserve currency. Already America's largest creditor, China, is admonishing Washington to protect China's investment in U.S. debt and lobbying for a new reserve currency to replace the dollar before it collapses. According to various reports, China is spending down its holdings of U.S. dollars by acquiring gold and stocks of raw materials and energy.

The price of 1-ounce gold coins is $1,000 despite efforts of the U.S. government to hold down the gold price. How high will this price jump when the rest of the world decides that the bankruptcy of "the world's only superpower" is at hand?

And what will happen to America's ability to import not only oil but also the manufactured goods on which it is import-dependent?

When the oversupplied U.S. dollar loses the reserve currency role, the U.S. will no longer be able to pay for its massive imports of real goods and services with pieces of paper. Overnight, shortages will appear and Americans will be poorer.

Nothing in Presidents Bush and Obama's economic policy addresses the real issues. Instead, Goldman Sachs was bailed out, more than once. As Eliot Spitzer said, the banks made a "bloody fortune" with U.S. aid.

It was not the millions of now homeless homeowners who were bailed out. It was not the scant remains of American manufacturing -- General Motors and Chrysler -- that were bailed out. It was the Wall Street banks.

According to Bloomberg.com, Goldman Sachs' current record earnings from their free or low-cost capital supplied by broke American taxpayers has led the firm to decide to boost compensation and benefits by 33 percent. On an annual basis, this comes to compensation of $773,000 per employee.

This should tell even the most dimwitted patriot whom "their" government represents.

The worst of the economic crisis has not yet hit. I don't mean the rest of the real estate crisis that is waiting in the wings. Home prices will fall further when the foreclosed properties currently held off the market are dumped. Store and office closings are diminishing the ability of owners of shopping malls and office buildings to make their mortgage payments. Commercial real estate loans were also securitized and turned into derivatives.

The real crisis awaits us. It is the crisis of high unemployment, of stagnant and declining real wages confronted with rising prices from the printing of money to pay the government's bills and from the dollar's loss of exchange value. Suddenly Wal-Mart prices will look like Nieman Marcus prices.

Retirees dependent on state pension systems, which cannot print money, might not be paid, or might be paid with IOUs. They will not even have depreciating money with which to try to pay their bills. Desperate tax authorities will squeeze the remaining life out of the middle class.

Nothing in Obama's economic policy is directed at saving the U.S. dollar as reserve currency or the livelihoods of the American people. Obama's policy, like Bush's before him, is keyed to the enrichment of Goldman Sachs and the armament industries.

Matt Taibbi describes Goldman Sachs as "a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money." Look at the Goldman Sachs representatives in the Clinton, Bush, and Obama administrations. This bankster firm controls the economic policy of the United States.

Little wonder that Goldman Sachs has record earnings while the rest of us grow poorer by the day.