Ladies and Gentlemen: the US Is Insolvent

The big news of today (well, not so new: it's just now official), from Jessescafeamericain:

"We are out of money."
Barack Obama May 23, 2009

Obama openly says what anyone with common sense has known for quite some time: the US is broke, and will not be able to honor its financial and fiduciary obligations.

The question remains how the US restructures that debt and how big a haircut the debt holders will take.

20%? 30%? More like upwards of 50% at least in real terms.

And who are these debt holders?

Anyone who hold Treasury debt obligations and financial assets, from the Long Bond to the US Dollar, and assets guaranteed by the Federal Reserve and the Treasury.

Technically the debt will be serviced and the interest paid according to the terms of the agreements, with devalued US dollars.

The process will continue until the debt is restructured and the dollar is replaced with a new dollar. This may take some years.

The Incontrovertible Truth About Debt, Deleveraging, Devaluation and Recovery

Why the US Has Gone Broke: Chalmers Johnson

Marc Faber Sees Bankruptcy for the US

In 2009 the US Will Be Forced to Selectively Default and Devalue Its Debt

A Credit Bubble of Historic Proportion

Shhhhhh.... Here is a Secret Worth Remembering

Didn't you just know they would spill it over a long holiday weekend?

Don't be too concerned, there will be more spin and denials after this trial balloon has been floated, and life will go on.

"Oh, that's not what Obama meant. He means we have a problem but there are the means and the time to address and repair it before it becomes too great."

People have an enormous capacity for delusion bordering on selective amnesia. Go back and read the posts on this blog starting in September 2008. Then reflect on what has been said recently on Wall Street and you will see what we mean.

We are now in the endgame of an historic credit bubble that will result in a currency crisis of epic proportions. Source

More: The Terrifying Future Facing America, by Eric deCarbonnel, May 23, 2009

And more: China Grows More Picky About Debt

The hidden censors of the internet

Journey with us to a state where an unaccountable panel of censors vets 95 per cent of citizens’ domestic internet connections. The content coming into each home is checked against a mysterious blacklist by a group overseen by nobody, which keeps secret the list of censored URLs not just from citizens, but from internet service providers themselves. And until recently, few in that country even knew the body existed. Are we in China? Iran? Saudi Arabia? No – the United Kingdom, in 2009. This month, we ask: Who watches the Internet Watch Foundation? Read all here

Nigeria News Updates -- May 24, 2009

Just in from warnewsupdates:

Thousands Flee Nigeria Delta Fighting -- BBC

Thousands of refugees from a remote area of a Nigerian oil-producing state have fled fighting between the military and oil rebels; sleeping in the swamps and too afraid to go home.

When military helicopters buzzed over the small town of Oporoza, in Nigeria's Niger Delta, it was just two days after 19-year-old Happiness Michael had given birth.

The helicopter gunships hovered low over a crowded street, where people had gathered to celebrate an annual festival, and opened fire with machine guns and rockets, according to several accounts.

Read more ....

More News On The Unrest In Nigeria

MEND destroys main pipelines in Nigeria - PressTV
Nigeria's VP says Niger Delta crisis to end soon -- China View
Nigerian troops to suppress Delta rebellion -- Press TV
Nigerian army seeks to rid oil delta of militants -- Reuters
Nigeria army vows to push on with oil delta campaign -- Reuters
More hostages freed in Nigerian delta, army says -- Reuters
Peace still elusive in Niger Delta as militants leader declared wanted -- China View
France offers to help crush Niger rebels -- Press TV
French Prime Minister in Niger Delta amid tight security -- AFP
Politics of N’Delta crisis -- The Punch
A new path in the Niger Delta -- Next
Update: Blood And Oil In Nigeria

Classwar in America, the Ongoing Assault By Vi Ransel

Must read of today on dandelionsalad. Excerpt:

"...And we still have the nerve to pretend “it” can’t happen here. Benito Mussolini defined “it” best – “FASCISM should more appropriately be called Corporatism because it is a merger of state and corporate power.”. But perhaps, since we’re mis-educated and TV-engineered to be less smart than artichokes, we’re able to ignore all the evidence we see around us, refusing to see what our own “lying” eyes are telling us. Maybe we’re just afraid. Not without good reason. But maybe we’re just not hungry enough. Yet. But in the event we finally get fed up with being economically waterboarded, when we’re sick of suffering real, not simulated, drowning as the value of our homes goes underwater, well the plutocracy is prepared for than eventuality. Their minions, the Obama Administration and the U.S. Congress stand ready to put us down again, if need be, just like President Herbert Hoover sent Generals Patton and MacArthur, the 12th Infantry, the 3rd Cavalry and six tanks to charge into the Bonus Army with fixed bayonets and adamsite gas during the Depression.

Our own Dear Leaders have already brought combat-hardened troops back from Iraq to deal with us in case we cause “civil unrest”. Remember. Posse comitatus is history. Not to mention habeas corpus. And if our combat troops won’t turn on their own people, today’s Pinkertons, the hired contractor-killers of Blackwater (now Xe) will. They were on the job for the plutocracy in New Orleans after Katrina. That was just a dry run. They’re ready for you, too.

And if you further insist on getting a fair share of the wealth you produce with your labor, they’ll send you on a vacation – to one of Halliburton’s Holiday Hotels, constructed for FEMA under REX-84. This turned abandoned World War II German and Italian POW camps in the U.S. (Did you know we had these on American soil?), Japanese internment camps, closed army bases and mental institutions into detention camps, ostensibly for when we’re overrun by “illegal” aliens, but actually for the uppity. And they’re staffed and waiting for us where we will, perhaps help “American” transnationals achieve corporate nirvana – forced, no-wage labor.

Vi Ransel, TPC’s senior editor of anti-capitalism, is a researcher and poet of exceptional caliber. Very little is known about her." Read all here

US Dollar Skids to New Lows, Expect it to Continue

By Jennifer Shotts - http://www.informationclearinghouse.info/article22691.htm

This week so far, the dollar has fallen 4% against the British pound reaching a new low for 2009, 3% against the euro and Japanese yen, and also against the Canadian dollar. With major price levels being broken, many banks are reevaluating year end predictions for the euro vs. the dollar to reach $1.50 or higher. Is this going to be the new trend of 2009, dollar's death spiral? Here's some reasons why many say its time to chuck the buck.
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Are Investors in the US and Abroad Losing Faith in the Dollar?
By Mark Trumbull

Are US debtors, from the federal government to the cash-strapped state of California, going to default? Will the Federal Reserve resort to inflation - debasing the value of dollar assets - in its efforts to lift a debt-bound economy back to growth?
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US dollar at 2009 low, bonds down with supply ahead:

The U.S. dollar dropped to its lowest level this year and government bonds fell further on Friday as concerns mounted about rising U.S. debt levels after investors questioned the strength of its AAA credit rating.
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"The Sinking Dollar", May 15, 2009, Commentary No. 257 by Immanuel Wallerstein

...All the main actors are hoping there can be a soft landing, an orderly transition away from the U.S. dollar. No one wants to precipitate a free fall, because no one is sure to come out ahead if that happened. But if the U.S. stimulus turns out to be the last of the bubbles, the dollar could very suddenly deflate in a most chaotic fashion. The way you say "stampede" in French is "sauve-qui-peut," which translates literally as "let him save himself who can."...