Posts Tagged ‘Washington’

 

King World News

With the ongoing US government shutdown, today 40-year veteran, Robert Fitzwilson, states that we owe “$220 trillion,” and asks the all important question, how long can the “fantasy” continue.  He now believes we are getting very close to kissing the fantasy goodbye.  Fitzwilson, who is founder of The Portola Group, put together another tremendous piece below for KWN readers around the world.

 

By Robert Fitzwilson of The Portola Group

October 6 (King World News) – “We Owe $220 Trillion, How Long Can The Fantasy Continue?”

 

The conflict in Washington, D.C. Is not about politics.  It is about mathematics.  We have  finally come to the end of the road of over-promising and under-delivering.  While not unique to the United States, it is particularly problematic given the dollar’s reserve currency status….

 

Continue reading the Robert Fitzwilson piece below…

 

 

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The current crisis has been predicted for at least 30 years.  What was not fully comprehended by those making the prediction in the 1970s was the insatiable demand for dollars by a rapidly industrializing world.  Decades of printing, combined with globalization and financial engineering, secured a dominant place in the capital and goods markets for the currency.

 

We remember the “megabuck”, millions.  It then became the “gigabuck”, billions, before you knew it.  Denominating assets and revenues in billions became almost a badge of honor in an electronic world where adding a few zeros was a trivial task.

 

In the stock market, the definitions of large, mid and small capitalization stocks have drastically increased over recent decades.  A handful of companies have even begun to challenge the $1 trillion market cap level.  It is not all due simply to inflation.  This has also been due to the emergence of a truly global marketplace.  Brands such as Google, Apple, Amazon and Priceline are no longer restricted by geography.  The size of their customer bases has dramatically increased, resulting in a much larger financial opportunity for those companies as well as others with the right combination of goods and services.

 

As the economic pie continued to grow, in current dollars, politicians found virtually unlimited capacity to make promises to their constituents.  In California, the amazing success of high-tech companies and the enormous wealth creation also coincided with the dramatic expansion of public sector benefits.

 

A lottery winner who had squandered the newly found money once said that “winning the lottery is like Miracle Grow (fertilizer) for character defects”.  Silicon Valley is certainly prone to that.  To be fair to the public sector employees, it probably became a bit intolerable watching enormous wealth being created along with the unavoidable arrogance that can often accompany such success.  They wanted their piece of the pie.

 

As we draw closer to the time when the benefits and promises must be paid, we are finding that the prosperity on which the commitments were made was insufficient, illusory and delusory.  Taking into consideration the $220 trillion of obligations, let alone the annual spending deficit as examples, one can easily see that the mathematics do not work.

 

We are at the end of the road.  It is a choice between the brake or the accelerator.  We can either accelerate into financial oblivion and a new global currency system, or tap on the brake to provide time to deal with the pain in an orderly manner.  Our preference is for the former, but there is little evidence that the politicians around the world will concur.  Slamming on the brakes is an option, but would be needlessly destructive.

 

Hanging on to power is one-and-the-same with handing out goodies.  The debt ceiling in the U.S. will be raised and the fantasy that Bill Fleckenstein outlined will continue.  The mathematics will require larger and larger amounts of printing just to maintain the status quo.

 

While we wait for events to unfold in Washington, the good news is that the global economy continues to generate opportunity for those willing to look.  We find high-technology, medical/biotech, productivity and energy to be very attractive sectors at this time.  For example, the U.S. Energy Exploration and Production sector is undergoing a very powerful renaissance.  It is very unusual to see such dramatically positive outlook for an entire industry.  There is real value being created there, and it looks to be very sustainable.

 

Gold and silver have performed reasonably well and should continue to be accumulated by long-term holders.  The mining companies continue to be the “whipping boys”.  Several times in the last quarter, the HUI has been outperforming other asset classes only to be smashed down.  The end of the quarter was no exception.  In the last week and a half, the outperformance of the HUI was reversed.  There is little doubt that the value represented by quality companies continues to be quite tremendous, but holdings should be maintained for the long-term as it is impossible to know when that inherent value will be realized.

 

IMPORTANT – One of Bill Fleckenstein’s best KWN audio interviews ever discussing the coming collapse in stocks, gold, the end game and more is available now and you can listen to it by CLICKING HERE.

 

Update – The KWN audio interview with David Stockman discussing financial collapse, a coming flight to gold, the end game and more is available now and you can listen to it by CLICKING HERE.

 

© 2013 by King World News®. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.  However, linking directly to the blog page is permitted and encouraged.

 

The audio interviews with Bill Fleckenstein, David Stockman, Robin Griffiths, Jim Grant, Gerald Celente, William Kaye, Dr. Paul Craig Roberts, Chris Powell, Michael Pento, Eric Sprott, Andrew Maguire and Grant Williams areavailable now. Also, other recent KWN interviews include Marc Faber and Felix Zulauf to listen CLICKING HERE.

 

Eric King

KingWorldNews.com

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The suspect in the high-speed chase between the White House and the Capitol Building was identified Friday by a law enforcement source as a dental hygienist from Connecticut with a history of mental issues.

The source identified the woman as Miriam Carey, 34, of Stamford, Conn. Carey tried to plow her car into a barricade at the White House, then led cops on a high-speed chase before being shot dead near the Capitol, according to reports.

Rep. Michael McCaul, chairman of the House Homeland Security Committee, told Fox News that investigators believed  Carey suffered “serious” mental issues and that President Obama was trying to communicate with her through radio waves.

Sources tell Fox News that the FBI is currently investigating how long the suspect was in Washington, DC and why she had travelled there from Connecticut.

Leslie Silva, a Stamford lawyer who has represented Carey, said she was unaware of any connection or reason why Carey would have been in Washington.

“Oh my goodness, I represented her,” Silva said to when reached by phone.  “She was a really nice woman, we had [our] children at about the same time, we had pleasant conversation.”

Silva added that she represented Carey when she bought her Stamford condo and again more recently in a dispute over a small amount of money with the development that was settled in February, the last time she communicated with the suspect.

“I had nothing but pleasant conversations with her when I represented her and I’m just really really shocked,” she said.

A harrowing car chase unfolded Thursday after the driver rammed the barricades, briefly shuttering the chambers where federal lawmakers were debating how to end a government shutdown and stirred fresh panic in a city where a gunman two weeks ago killed 12 people.

Police said there appeared to be no direct link to terrorism, and there was no indication the woman was even armed. Capitol Police Chief Kim Dine, whose officers have been working without pay as a result of the shutdown, called it an “isolated, singular matter.”

Still, tourists, congressional staff and even some senators watched anxiously as a caravan of law enforcement vehicles chased a black Infiniti with Connecticut license plates down Constitution Avenue outside the Capitol and as officers with high-powered firearms canvassed the area.

The House and Senate both abruptly suspended business, a lawmaker’s speech cut off in mid-sentence, as the Capitol Police broadcast a message over its emergency radio system telling people to stay in place and move away from the windows.

The woman’s car at one point had been surrounded by police carsand she managed to escape, careening around a traffic circle and past the north side of the Capitol. Video shot by a TV cameraman showed police pointing firearms at her car before she rammed a Secret Service vehicle and continued driving. Metropolitan Police Chief Cathy Lanier said police shot and killed her a block northeast of the historic building.

Carey’s mother, Idella Carey, told ABC News Thursday night that her daughter began suffering from post-partum depression after giving birth to her daughter, Erica, last August.

Idella Carey said her daughter had “no history of violence” and she didn’t know why she was in Washington, D.C., on Thursday. She said she thought Carey was taking Erica to a doctor’s appointment in Connecticut. Authorities also discovered an unidentified white powder at her Connecticut home.

Fox News’ Perry Chiaramonte, Jana Winter and The Associated Press contributed to this report.