The Next Big Crash Of The U.S. Economy Is Coming, Here’s Why

Investors better be prepared as the next crash of the U.S. economy is coming.  This is not based on hype or speculation, rather due to the disintegration of the underlying fundamentals.  Matter-a-fact, the fundamentals are so completely AWFUL, that the next market crash will make 2008 look quite tame indeed.

To get the skinny on the lousy fundamental data, let’s first look at the Auto Industry.  The next series of charts come from the article, More Warnings–Unsustainable Auto Sales & Stock PE Ratios:

Auto-Loans-Owned-Securitized-Chart

Ever since the supposed economic turnaround, the amount of outstanding auto loans has increased dramatically from less that $700 billion in 2010 to over $1 trillion in the fourth quarter of 2015.  According to Wolf Richter, quoted in the article:

“Deep-subprime borrowers are high-risk. Typically they have credit scores below 550. To make it worth everyone’s while, they get stuffed into loans often with interest rates above 20%. To make payments even remotely possible at these rates, terms are often stretched to 84 months. Borrowers are typically upside down in their vehicle: the negative equity of their trade-in, along with title, taxes, and license fees, and a hefty dealer profit are rolled into the loan. When the lender repossesses the vehicle, losses add up in a hurry.

When I was younger, the longest automobile loan an individual could get was 48 months.  However, you were considered to be a REAL LOSER if you had to finance an automobile that long.  Now, 84 months is becoming the norm….LOL.

This is just one factor that shows just how weak the economy has become if Americans have to finance a car for seven years.

Here is another chart from the article linked above.  It shows just how inflated the S&P 500 index has become:

Growth-of-SP500-Earings-Chart

According to Michael Lebowitz of 720 Global Research (quoted in the article):

Since October 1, 2011, the S&P 500 has risen 82% on the heels of a 0.75% decline in earnings. The price to earnings ratio over that time period has risen 83%, with price gains contributing 99% to the increase. Prices have risen substantially, while earnings have actually fallen. The chart below highlights the growing gap between earnings and the S&P 500.”

As we can see from the chart, the S &P 500  and earnings have been surviving on HOT AIR, especially since the latter part of 2014.  When QE (money printing) and zero interest rates no longer provided enough bounce in the markets, the Fed, Central Banks and the Plunge Protection Team stepped in a BIG WAY to keep the markets from crashing.

So, not only do we have a highly over-leveraged automobile financed industry, the broader stock market valuations are in bubble territory.  Unfortunately, this is only part of the story.  If we look at the disintegrating U.S. Energy Industry, the situation is even more dire.

The Coming Collapse Of The U.S. Energy Industry

Today I did an interview with Money Metals Exchange.  I will be putting out the interview when it’s published.  However, I discussed this energy subject matter during the interview.  When I first started the interview, I said the precious metals community was guilty of propagating hype and short-term surging price moves that never came true.  Thus, we have frustrated a lot of precious metals investors because the COLLAPSE of the Dollar, DEFAULT of the COMEX or much HIGHER gold and silver prices have not yet occurred.

So, am I guilty myself by putting out a new a headline that reads, “The Coming Collapse of the U.S. Energy Industry?”  No…. here’s why.

The situation in the U.S. Energy Industry is so AWFUL, I wouldn’t be surprised to see half of the industry go bankrupt over the next few years.  Of course, the U.S. Government could step in and either bail out or nationalize the energy industry, but this wouldn’t stop the impending collapse.

Let’s take a look at this next chart.  The U.S. Energy Industry has added so much debt that it took nearly half of all its operating profits to just pay the interest on its debt in 2015:

U.S.-Energy-Sector-Interest-Payments-On-Debt-%

While this was bad, it was even worse in the first quarter of 2016.  According to the article, Why Oil & Gas Companies Are Barely Scraping By, the U.S. Energy Sector paid 86% of its total profits just to service the interest on its debt.  Can you imagine that?

This chart from the article shows the huge change of interest payments on debt of the percentage of operating income in the U.S. Energy Sector:

U.S.-Energy-Sector-Interest-On-Debt-YahooFinance-Chart

Since 2000, the U.S. Energy Sector was paying (on average) between 10-15% of its operating income to service its debt.  However, that changed significantly in 2014 as the price of oil plunged.  The reason this percentage jumped over 20% in 1998 was due to the price of oil falling below $15 compared to $22 in 1996.

So, why is the U.S. Energy Sector interest on the debt so much worse now with the price of oil more than double the 1998 price??  Again, the average annual price of oil in 1998 was $15 compared to $33 in Q1 2016.  Why did the U.S. Oil and Gas Industry have to pay 86% of its operating income to service its debt during the first quarter of 2016 on the back of a $33 oil compared to 25% on $15 oil in 1998?

BECAUSE…. The U.S. Oil & Gas Industry has gone into massive debt to bring on very expensive energy supplies.

Here is one more chart from the energy article linked above:

U.S.-Energy-Sector-Debt-Maturity

This chart shows the U.S. Energy Sector maturing debt outstanding for each year.  According to the article:

While $5.1 billion of U.S. energy debt matures this year, $25.1 billion will mature in 2017. The number risies to $52.5 billion in 2020.

“There’s not a lot of this debt that comes due in 2016. But in 2017—that’s when the rubber will really hit the road. Now a lot of these companies are already looking to bankruptcy because people know that the bond position is untenable,” said Dicker.

As the article states, the outstanding U.S. energy debt that matures in 2017 ($25.1 billions) is five times what matures this year ($5.1 billion).  How can the U.S. Energy Industry pay back this debt when it can barely pay the interest on its debt currently?

And… to make matters even worse, U.S. oil production is falling rapidly:

U.S.-Field-Oil-Production-Weekly

U.S. domestic oil production peaked at 9.6 million barrels per day (mbd) in June 2015 and is currently at 8.7 mbd.  This is nearly a 10% decline in U.S. oil production in less than a year.  Some may think this huge decline is due to lower oil prices.  That may be partly true, however U.S. oil production was going to decline even with higher oil prices.

Which means, the U.S. Energy Sector will be in even more trouble as oil production declines further as the amount of debt that matures continues to increase over the next several years.  This is extremely bad news for the U.S. economy as it will have to import more foreign oil to make up for declining domestic production.

Of course, this means the market will have to react by offering 96 and 108 month payment plans to keep the automobile financing bubble from popping.  Furthermore, I would imagine the Plunge Protection Team will work overtime just to keep the markets from imploding.

As the fundamentals of the market continue to deteriorate, the precious metals offer the only real safe haven.  As I mentioned in a previous article, Something Big Happened In The Gold Market, mainstream investors flocked into Gold ETF’s in record numbers during Q1 2016:

Global-Gold-ETF-&-Similar-Fund-Demand

Investors moved into Gold ETF’s in a big way during the first quarter of 2016 on a mere 2,000 point drop of the Dow Jones.  Why would investors move into Gold ETF in such a large degree as the market sustained a normal 15% correction??  Hell, in the first quarter of 2009, flows of gold into Gold ETF’s surged to a record 465 metric tons, but this was when the Dow Jones was crashing to its lows of 6,700.

I talk to several people in the industry, and the word out there is that mainstream investors are worried as hell about the markets.  I believe when the broader markets really start their NEXT BIG CRASH, investors will flow into gold and silver in record volume.

This is not a matter of “IF”, but “WHEN.”  However, if we go by the disintegration market fundamentals, that day will likely be sooner, rather than much later.

Lastly, if you haven’t checked out our new PRECIOUS METALS INVESTING page, I highly recommend you do.

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43 Comments on "The Next Big Crash Of The U.S. Economy Is Coming, Here’s Why"

  1. Of course this is a short article; can’t include everything.

    But how about an honorable mention for the student loan industry, and the growing delinquencies.
    Here is one of many articles on the topic: http://www.marketwatch.com/story/every-second-americans-get-buried-under-another-3055-in-student-loan-debt-2015-06-10

  2. And may as well mention this. A friend who has a good income and a relatively secure career doesn’t think the economy is facing a 2008-style collapse because that one had a subprime mortgage crisis. Ooops http://www.cnbc.com/2016/05/26/wells-fargo-launches-3-down-payment-mortgage.html

  3. Wow. A five fold increase on maturing debt next year. Incredible. And I thought it was levitating now.

    Our civilization will stare at these interconnected predicaments, mesmerized, for only so long. Then it will faint or run in horror.

    In the old Road Runner cartoons, Wyle E. Coyote would run off the cliff yet stay suspended in mid air. He never fell until he looked down.

    Greater and greater numbers of people seem to be waking to a world of dire straights and gazing into the abyss. When “looking down” reaches critical mass, does the free fall begin?

    • OutLookingIn | May 26, 2016 at 9:43 pm | Reply

      Don’t “look” to the average consumer for demand.

      The historic post WW II average of household debt held as a percent of GDP was 43%. At the moment this is now 74% and growing. No “wriggle” room left.

      Prior to 1980 the “peak” household debt to wage/salary income was 75%. We now have a new “peak” of 220% set in 2007. The household sector has since been slowly deleveraging. The key word there is SLOWLY, because of rotten fundamentals.

  4. I’ve been reading these warnings for 6 years now. It was always Butler, Morgan, Schiff and the like who are selling silver for others and forecasting some sort of doom and gloom. Mines were going bust because production costs exceeded the spot price. It was $30 but the mines got leaner. Then it was $20 and they got leaner yet. Then it was $15 and now its $12.50 but this scenario didn’t work. Last year bar and coin sales rose 20+% but no effect on silver. Every place I visit like Monex, Silver Exchange is giving me reasons why silver will soar. Then it was the Shanghai exchange going physical and the Comex was doomed. Never happened! After all China is a net importer. Why on earth raise the cost on something they import? Then it was market manipulation. This reminds of when I bot pork bellies on margin. The broker said that if the price fell I would have a margin call. I said no I won’t I’ll take the pork bellies I bought. He said they don’t exist. What I was doing was betting on what the future price of pork bellies would be and that had nothing to do with the physical. Same goes for silver. It is a con game of hype and scare tactics. The Comex trades more silver daily than exists. They don’t need the physical. The are betting on the future price and at the same time rigging the outcome. In this manner they control the spot price. Then I read of FIAT money. All silver mines and sellers of silver do it for the dollar. As Trump just said, we own a printing press. Many countries went through a currency devaluation. Japan, Venezuela, Mexico, England, Italy, Greece and on and on. It will take years to cause a crisis as the doom and gloomers predict for a nation like the USA. Let’s face it guys. We’ve been duped. Silver may rise do to simple inflation but it will take many more years. Now Steve you are saying the next big crash! After all the things forecasted prior to that statement that failed to fulfill the
    prediction, we now must have a stock market crash to getting silver above $17. This keeps the ball rolling and readers / stackers roll with it. The real answer staring everyone in the face is the fact that
    demand by the USA population are not interested in silver, nor are its billionaires. These miners can
    supply all the silver that is need at the present price. And if the price rises more mines will come aboard.
    As W.C. Fields said, ” There’s a sucker born every minute” and I’m one of them.

    • Yippee ki-yay MF! | May 26, 2016 at 11:01 pm | Reply

      Well there was that whole Weimar Republic thing….

      To say someone has been duped, implies someone is in control and has information that you do not. Maybe that is the case, but what is so messed up today is the fact that Black Swans are everywhere…

      Even the Bond King is shorting debt…. http://www.zerohedge.com/news/2016-05-26/system-itself-risk-bill-gross-warns-shorts-credit-day-reckoning-coming

      Things haven’t made economic sense for a while now, but they really don’t make any sense lately. News of a potential Fed rate increase (and no QE) and stocks fall. The next day, news of a potential Fed rate increase, stocks rally. Companies continue to layoff employees, cut costs, and fail to deliver any top-line growth, and stocks still rally. Companies are buying back shares at all time highs…. Hurts my head just thinking about it….

      • Bill Gross has been succeeded way too much to be able to understand that he is not old fashioned in this new era of capitalism. By the way he is probably out of the club since fired of pimco for a simple 1 billion+ fund.

    • Same meme/theme every post Joe.

      Read things & spend time on things that make you happy.

    • Joe Lindell,

      You are a piece of work. I would imagine if you won $1 million dollars in pennies, you would complain that you had to go to the bank to exchange it into Dollars.

      You are one of the few who continue to BERATE those who are pointing out the corruption.

      steve

      • Great Steve! You’re the piece of work. You don’t want EROI to end. You are now a celebrity. The fact remains is you call your articles “information.” The facts are that
        your info had no effect on spot silver. You talked about mines for months and in
        a way so that people would buy silver. Was your info valid? Then you talk FIAT. Here
        again no effect. Then Shanghai, India and on and on….no effect. Now it’s a market
        collapse? All prior market “corrections” recovered. Even the 2008-2009 crap. If it went away totally there would be no USA. What happened to peak oil? Is that story now out to 2030? And in 2030 half of the USA will be on natural gas, NGL,solar, Wind, dams , electric cars, coal etc. ? Where is peak oil then?. You call me a piece of work? What about your prognostications? I’ve harmed no one. How many unsuspecting readers bot silver because you said mines will collapse? Name calling is the last resort Steve. Shame on you.

        • lastmanstanding | May 28, 2016 at 9:41 am | Reply

          Joe. If anyone here or anywhere for that matter is buying silver or gold because of what someone else says, God help them.

          You either believe in things that are real or you don’t.

          I don’t go to sites that are a waste of time, perhaps you do the same.

        • Joe,

          Name calling?? Do you believe saying “A piece of work” is name calling??? LOL, I thought you were a tough ol fella. Come on, you have to have a thicker skin than that. People call me much worse all the time.. LOL.

          Joe, you are just frustrated like most. I don’t blame you, however you are fickle like the public. Riding high when things are good and the first to continue complaining when things don’t go your way.

          Life is more than that… dear sir.

          steve

        • *Every manipulative trick imaginable [and some that can’t be imagined] will be used
          to stop the spot price on silver and gold from going up. This is essential to DELAY
          the collapse of the system, with DELAY being the operative word. That collapse
          could EASILY be this year, or a few years out, but not decades.

          *EVERY fiat currency has in time collapsed and so will the U.S. dollar. It doesn’t
          matter that 99% of U.S. citizens don’t have PM’s, or their savings/investments are
          in stocks that will go down in value from here. The fact that utter chaos would
          result from a rapid decline of the dollar’s buying power, or a collapse of stock
          market prices, or a partial default on the national debt, or pension funds collapse,
          or name a financial calamity….that does not mean it won’t happen. Bad stuff CAN
          happen and it WILL happen…to the majority of citizens.

          *Fiat may not go away. But in the future if someone has a good used car to sell, they
          may choose to sell it to someone who has something other than or in addition to
          dollars.

          *2008-2009 crap did not go away. It was buried under massive new debt creation
          and low interest to manufacture a recovery. Purely kicking the can down the road.
          The can is still there.

          *The Fed is probably buying the stock markets to DELAY a big selloff, but they CAN’T
          prevent it. They can shut down the NYSE and other markets several times a day,
          usurping stockholder’s rights to sell their stocks, and temporarily slow the
          waterfall.

          *EROI is a scientific principle regardless of time or location. It doesn’t have a
          beginning or an end.

          *The Fed IS NOT omnipotent, and they and the plunge protection team are worried. They can delay but can not stop what has been set into motion.

          • Ben Fulford has stated the last man standing agaisnt had finally accepted open the talks for a new international monetary system, no idea if this a grain of truth or whether it is coming from his imagination.
            By the way, I am happy that many realize that central banks have still many bullets left and can delay a major credit inciddent for several more years.
            In the meantime real estate could increase 50 or even 100% compared with gold for example or USD.

    • Joe, its true we and several other countries have the printing press. That’s the real point. By printing the currencies into oblivion they devalue the paper to the point that the true worth of the currencies loses its confidence. Its a confidence scheme. And when the confidence in the purchasing power of a currency that is obviously being printed into oblivion is lost then all the assets values in that currency loses their value as well. Not that a stock or bond is worthless. Its just the currency that establishes its so-called worth is lost. A share in a productive company or a bond in that company still has value, just not in the currency it is quoted in. There will be new currencies and whether they or it will be backed by gold or not remains to be seen. This crisis that is building however is very different than anything ever seen before in human history. All currencies are fiat now and there are fewer and fewer places to run to when the confidence is lost. This will change the way we think about currency an to go back to a currency backed by the trust and faith of a tax payer will probably NOT be in the cards. In the end Gold and Silver are really an excellent way to back a currency simply because the metals represent those metrics that define real money. There should be no real reason to NOT do it. We simply adjust the value of the metal to reflect the current state of assets globally. These central banks and their hordes of compliant economists, paid-off politicians and think tank whores all feed off the free money that is stolen from the future of the citizens. That system will end as it was always expected to. No one really thinks the parabolic growth of money and asset values were sustainable. The cleansing will be huge and shake the planet in a way that will not be forgotten for centuries.

    • Your comment is meaningless, demand is record high (all mints), supply stable at best, hence price should be rising.
      Why not?
      Then you say that mines have no problem, that they adjust?
      Oh, how well they adjust to 15 price, all lose money and accumulate debt,
      Hmm very sustainable…
      Is obvius you work for the banksters.
      No real PM buyer could be so obtuse.

  5. The people and the system we rely on suck. When there is a change gold and silver will be a very good thing to have some of, if you can get it. Demand for industrial silver is rising as is investment silver demand, there is a supply deficit already. J.P.Morgan is hoarding silver, as are Russia and China and Central Banks the world over accumulating gold, why? Is it because they have faith in the present system, in the U.S government and the dollar? Is it because they are convinced the Fed has fixed the problems of the economy since 2008? Maybe they are all acquiring precious metals cause the political picture world wide is so rosy and the migrants by the millions will eventually be a good thing. forward thinkers they are so they are hedging their bets with PMs. It’s the only “Real Money”

  6. American owners of PMs are in trouble. PMs are priced in US $. The $ is the basic currency during crises. So it makes sense to own PMs in countries with weak currencies but not in the US. In 2008/2009 EM currencies went down and the prices of PMs in their currencies increased substantially. PMs have been rallying in numerous currencies for the last several years but not in the US $.

    • eva,

      Always a POSITIVE SPIN on the precious metals… aye? Sometimes I wonder what your true motivation is. While you are welcome to continue your BEARISH rhetoric on gold and silver, the FUNDAMENTAL ENERGY SITUATION in the United States is Dire. Maybe one day you will wake up…. LOL.

      steve

  7. gary lindsay | May 27, 2016 at 5:37 am | Reply

    Steve

    As you rightly point out our debt markets rely entirely on cheap, abundant energy. They also rely upon a productive workforce.

    I have followed the argument closely since you really started banging the drum about declining EROI.

    Autism must now be a factor.

    This lecture explains

    https://www.youtube.com/watch?v=I8EtfkAngKw

    • gary lindsey,

      Thanks for stopping by and leaving a comment. Yes, the ENERGY SITUATION is the most important factor going forward. However, I can’t get much of the precious metals community to understand that.

      Furthermore, there are some analysts out there pushing the NOTION of the PEAK OIL SCAM, as they think abiotic oil is going to save us. Bix Weir promotes the idea that there is all this untapped oil and gold in the United States. I am surprised that people take him seriously.

      I think the next 2-5 years are going to be really damaging to the United States.

      steve

      • I think they are saying that improvement in technology will be able to decrease the cash and all in all costs in order to balance the fall of conventional oil production.
        They also think that irak and iran will able to increase a lotf their production by 2020.

        • RD,

          Unfortunately, that is wishful thinking by the Energy Industry. I have another energy article to come out shortly that will to show how TECHNOLOGY has cost the Shale Companies an ARM, LEG & FOOT. Shale oil companies added massive amounts of debt to bring on their shale oil or gas. Thus, they made no real profit.

          REMEMBER… more TECHNOLOGY lowers the EROI, thus the profits… IF ANY.

          steve

          • You may be right but do not dismiss the will of the major industrial and banking interests. If they consider that energy production is a serious issue to the DCF models, they will monetize all the old past debts with energy bond QE.
            We can even imagine (quite easily) that a another important part of the energy industry will be nationalized (even in the west) or at least backed by states and governmental sector and central banks.
            The fall of the Berlin wall and USSR later has led to the fusion between the soft western social democary and the hard USSR monopolistic state capitalism.
            I personaly do not expect any setbacks, only bigger assembly like eurasian economic union, SCO or MERCOSUR.
            I feel you analysis despite real valid points, do not take enough into account the intervention of the non private sector per se. Indeed if they have to print half a trillion a year in order to be able to run thee nergy business as usual, which would otherwise all the debt tower, be sure they will not be shy more than one second and you will see nobel prize explain a theory how it is great, the beauty of the capitalism, liberty human rights and whatsoever !

  8. silverfreaky | May 27, 2016 at 5:51 am | Reply

    Not only american owner of PM!I bought in germany silver in average at 25€ on ounce.
    My first silver in 2012.

    Some ounces had an collecting value.The canadian wildlife (Puma,Wolf,Grizzly).
    In total 2500 ounces.A heavy loss.

    By best coin is the “Aztekenkalender”.I think this coin (1kg) is really rare.I have the 2010 version.
    Look to the selling prices.Only 1500 pieces.Maybe i by an other one.
    http://www.gold.de/preisvergleich,170,Aztekenkalender.html

  9. Bill Sodomsky | May 27, 2016 at 11:53 am | Reply

    Hi Steve,

    On a part time basis, I come into contact with people from all over the world. Most recently, New Zealand, Vietnam, Singapore, Germany, Mexico, Great Britain, Korea and even the US. (I am located in Canada). In each case, I politely inquire about the state-of-affairs in their respective countries and in every case, they express tremendous concern about the future. Of course, other than the UK, which includes its colonies and the US, these people all speak more than one language which gives them an added advantage in the thought process. English only speaking people only think in English and when you only think in one language as Goethe stated, you know very little about anything for the most part. For example, time is linear, the past portends the future, sentence structure is limited to a sequence of noun-verb-object which means a one directional thought process etc., etc.
    How and the hell can you have a meaningful discussion with anyone who can’t think beyond the bounds of a certain limited vantage point and that doesn’t even include the brainwashing, falsification of the historical record or the intentional dumbing down of the population. No wonder you’re frustrated with the lack of coherence when it comes to the crucial nexus of energy and capital. Forget about it Steve. To understand the nexus of energy and capital you need a nimble and inquiring mind. You need to do some heavy lifting on the research front, you need to read and most importantly, you need to be able to think in a non-linear, unshackled manner. You must be worldly in your understanding of humanity either by personal in situ experience or thoughtful serious reading. You might want to take a minute (that’s all it will take) to tally the number of people you know that have those qualities.
    Anglophones are the most self-indulgent, self-consumed know-it-alls on the planet! Just ask them. Of course when you ask them where they get there all worldly knowledge, brace yourself for responses such as the newspaper if they’re highly advanced to the morning radio show on their way to work.
    Energy is everything!!! Nothing exists without some degree of it. We are captives in a (post) modern industrial society that existed and for the time being, exists because of cheap fossil fuel supplies and for no other reason. It was the lottery of ALL lotteries and unless it gets replaced real fucking fast with more of the same or an equally productive alternative, “THE PARTY IS OVER!” End of discussion. We’re not in a bullshit economic down cycle, we’re in the hangover stage of too much inebriation for too long. The end of cheap energy means mountains of un-repayable debt, the crushing of marginal customers and soon enough the rest, the new normal of unstable political edifices, constant wars and insurgencies to get what remains from those weaker, the abandonment of high cost industrial sectors and panicked capital flows from less stable to more stable geographic regions, temporarily. In the meantime, the consequences of diminishing low cost energy sources dislocates more people who invariably lose their incomes, their assets and eventually their ability to think clearly and coherently. Whatever labor they can contribute generates measly returns. Think of poorly paying part time minimum wage jobs with no benefits and no job security. EROEI applies as much to human labor as it does to energy extraction.
    The moron class of course for the time being will buy the Trump bullshit just as they bought the Regan bullshit back in the 1980’s. Yep folks, “It’s going to be morning in America.” The wall is going up, the industrial plants are going to fire up, real estate and infrastructure investment will go to the moon and Musk will slingshot us from the Moon to Mars. WAIT FOR IT!
    Oh… and what happens if we don’t? Well, you’d be hard pressed to find any precedent in the conventional historical record if you were so inclined to do your homework. You see, the fossil fuel bonanza was likely a one time extraordinary fluke of history. Modern Man, particularly Western Modern Man, hasn’t yet got the memo, even though odd balls like St. Angelo, Bardi, Tverberg, Ludlum, Heinberg, Kunstler et al, have been screaming from the wilderness.
    Soon, in relative terms, the curtains are coming up and when they do, the horror of our pending circumstances will be far too much for the uni-lingual, brainwashed masses who had the good fortune of living through an unprecedented period of history.

    • Bill,

      Excellent comment. Couldn’t agree with you more.

      steve

    • Don’t you realize there is a possibility (not a certainty) that what you are describing as an horror in the future is maybe a false assumption in the sense that the horror might be NOW ?
      Have you think that 10 million people making tens of miles into overcrowded highways in los angeles might be completely STUPID ?
      People in the west have indeed be so brainwashed for decades that they now believe the society will ever be the same paced only by the breath of commercial production and the democratic tyranny of monetary profits.
      Current capitalism (based on competition) is an impossible production mode on the long run (in term of decades or maybe a few centuries).
      There is often a common mantra in gold sites, it is going to be the end of the world with the return to stone age with comparison made with the fall of rome. They just did not realize that Rome was awful to live for Romans (except patricians) AND for all the slaves who worked into the latifundias.
      In fact in was awful except for the politic leaders and terrestrial owners ie the owners of production means. Sounds familiar maybe ?
      By the way, if 100% of paper assets and all kind of money would disappear, the production capacity and the knowledge will be left intact which are luckily what humans need for human life production and reproduction.
      With some luck, it will be the rebirth not the 4 apocalypse horsemen coming in town even if I agree there will be rocky times !

  10. Oil was bought with currency out of thin air for the last decades. The promise of future growth. The FED will buy oil debt with frn’s. However, the future growth component will fade, and with that, King Dollar. The emperor has few clothes left.

  11. What I am seeing here, original article & many responses is dyslexia. Not of sight, but of thought. Don’t

    know if it’s an official medical term, but it really should be.

    BTW

    Common to ALL the mumbo-jumbo & complexities going on here there is one simple answer, banks.

  12. Gmo sugar corn everything/fluoride/ Chem trails/ aborted fetal tissue in the flavoring of a lot of soda
    Hfcs
    Who is trying to kill us ???

  13. Epicyte gene in gmo corn let’s see how that will help Silver???

  14. What I’m amazed at is that the Avg person doesn’t realize that wealth is made in debt now. The genius of the system is that you follow the market, but when you ask for the product from the market. They don’t give you the product. Why would any person of a sound mind base cost on the market I asked myself years ago. I buy silver at $100 an Ounce and sell for $200 an ounce on many occasions.

    2015 Silver Libertads Revers Proofs, now you can define it the way you want, but we define it our way. Hence we have created our own market, and way of thinking and doing business. I sold a car for Gold 2 months ago, and in the process educated another person about precious metals. WHO ARE YOU EDUCATING?

    • Seattle,

      Who are you asking the question?

      steve

      • Just rambling aloud ma man. The only thing I would disagree with in some of your article is about Oil. I worked in the field for 5 year during this recent boom. The first thing your told is the following. Save your money and invest it wisely. Don’t go buying Fancy Cars and stuff. It isn’t if its going to go bust, but when. These people know the cycle, and know the game. Well at Least Big Red did for sure. Hence I got laid off last year during the last round of cuts. As expected when the over pumping was done.

        There’s enough oil in this country to produce for generations to come. Currently 1/2 of the oil we use yearly is produced right there in the USA. The SPR Between Texas and Louisiana is near full at 714 Million Barrels, Cushing OK is near full at another 45 Million. Not counting the many other storage tanks around America. Id estimate there is another 250 million above ground easy.

        These are oil producing states
        Texas 2.5 million a day
        North Dakota 1.2 million a day
        Cakufibua 600K per day
        Oklahoma 400K per day
        Kansas 120K per day

        These are two of the biggest untapped areas I know of for sure.
        Detroit Michigan Billions of Gas and Millions of Crude (Know you know why Farmland is back near Detroit)
        Fort Worth Texas Billions of Gas and Millions of Crude

        10 Million barrels of Crude alone is taken out the ground here daily. We use 18mbs. The only reason for the high cost is control in my estimation.

    • Debt is an asset ie a social relationship which is the main attribute of the fetish called money.

    • How you educated the other person?
      He already has an important amount of gold to buy your car.

  15. Sean Griffiths | May 29, 2016 at 6:02 am | Reply

    The maths here is scary…..to repay the oil debt is either impossible or oil companies are banking on $200/ barrel. To afford to fill up the tank wages will need to quadruple within the next 10 years. There are too many perfect storms on the horizon. Thanks for sharing this news Steve. I will start getting fitter on my bicycle because motoring will be impossible for most to afford before too long.

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