This update is a little bit lengthy, but I implore you to read it – and to encourage others to read it.

Well…..the time has now come upon our nation.  I’ve been writing for a long, long time about the Health Care bill being shoved through no matter what the cost – and now it looks like it’s closer than ever to happening.

For my newer readers, let me reiterate a very important point.  The Health Care bill has absolutely nothing to do with health care.  It’s all about the Federal government taking control over the 17% of our nation’s GDP devoted to that industry.  Why does the government feel the urgent need to do this?  Let’s review.

The international banking system controls our nation’s money supply.  The Federal government is not involved whatsoever in determining when money is created or how much money is created.  The government simply makes sure that it takes enough of the available money in order to keep its Marxist revolution going.

Yes, I use the term Marxist, which is different from Socialist.  It’s not an effort to throw disparaging terms around – but rather a desire to use concise and accurate terms.  Marxism is a derivation of Socialism – but with a few added “features”, such as the use of class warfare between the debt slaves to keep them fighting each other instead of the debt masters.

Anyways, the international bankers have embarked on a systematic destruction of “credit” all over the industrialized world.  People need to understand that “credit” is the same as “debt”, which is also the same as “money”  The only difference between “debt” and “money” is that “debt” is owed by the debt-slaves, while “money” is owned by the debt masters.  The $20 bill we may have in our wallet or purse means that we’re the debt masters over the future labor of some debt slaves to the tune of $20.  We do not have any monetary source in our current economy that is based on the concept of “completed labor”.  Everything is transacted upon the premise of future labor being owed ---- debt.

This all means that the action of credit destruction by the international bankers is also debt destruction AND money destruction.  They’re all one and the same.  Many people are concerned about inflation, when the facts are that rampant deflation is upon us.  Deflation is a reduction in the money supply relative to the available goods and services.  So why does it “seem” like things are costing more and we’re having inflation?

The Federal government has embarked upon an effort to counteract the credit destruction brought on by the international bankers by creating new debt in an amounts equal to, or greater, than the loss of credit.  The current drunken government spending is the only thing fooling people into thinking we’re not in a full-fledged deflationary depression.

Don’t believe me?  Why is it that President Obama pledged to bring our troops home from Afghanistan and Iraq – yet turned around and increased military spending to levels that will be higher than seen under George Bush?

The  Federal government is trying to find money to spend everywhere it can.  Yet it can only get money from three primary sources:

1) Fees and taxation.  The government can only raise fees and taxes so high before the citizens revolt.  Incoming tax receipts are dropping like a rock – so this is not a reliable source of funding for an entity looking to create vast debt.

2) Treasury Security sales.  The government is selling huge amounts of Treasury bonds, notes, and bills at Treasury auctions.  This greatly helps to create new debt – except for the “tiny” problem that much of the shorter term Treasury sales are just “rolling over” previous short-term debt that the government had sold in previous years.  The amount of newly created debt is therefore not as large as people think, and definitely not enough to balance out the credit destruction that the international bankers are causing.

3) Stealing.  Yes, “stealing” is a strong word – but that’s exactly what is occurring.  The Federal government maintains a series of “trust” funds.  Some of the more common ones are Social Security, Medicare, and Unemployment.  Instead of calling these “trust” funds, they should instead refer to them as “slush” funds.  Here’s what happens with these.  People are coerced into having deductions made from their paychecks that are sent off to the “trust” funds.  Most people think that their Social Security deductions are kept safe for them until retirement.  Nothing could be further from the truth.

Instead, the Federal government collects all of this money and uses it to pay out obligations to those currently receiving Social Security benefits (or Medicare, Unemployment, etc.).  Anything that is left over in each fiscal year is then stolen by the government and used for other pet projects.  The stolen money is replaced with slips of paper that say “IOU”.

Guess who gets to pay back those IOU’s?  Us, the taxpayers.  This means that the Social Security deduction on your paycheck next pay period could very well be going to pay back the Social Security deduction that you paid two years ago, that had been stolen by the government.  You’re being taxed to pay back your previous taxes that were stolen.

The little secret with the Federal government’s “trust” funds is that they are all broke!  What do I mean by broke?  I mean that they are all receiving fewer receipts for the current year than they owe in obligations.  Not only is there no more money for the Federal government to steal, but they actually have to steal from other things to make up for the shortfall in their obligations!  Obviously, this third method of creating new debt is completely used up ----- UNLESS, the Federal government can come up with a new “trust” fund that puts all of the other ones to shame with regard to size.

This is what the Health Care legislation is all about.  If passed, there will be no formal implementation of it for three years.  However, the collection of taxes to go into the Health Care “trust” fund will begin right away.  What happens when there are tax receipts coming in, but no obligations needing to be paid out?  The Federal government will steal ALL OF IT!!!  - and replace it with IOU’s that you will need to pay back through your future labor.

President Obama introduced the White House version of a prospective Health Care bill today.  You can read about it from this White House release: THE PRESIDENT’S PROPOSAL.

Please notice what it says on page 10: “Protect the Social Security Trust Funds. The President’s Proposal provides that, if necessary, funds will be transferred to the Social Security Trust Funds to ensure that they are held harmless by the Proposal.”

The Federal government is first going to take tax receipts from the Health Care bill to pay for the obligation shortfalls in the Social Security “trust” fund.  They’re going to rob Peter to pay Paul.

Folks, the battle is not over.  If you believe this information to be worthwhile then please forward it to those who want to join in the fight.

Be on the phones to your Senators and Representatives.  If this passes, then our nation will have taken a very large step towards its demise.

As an aside, take a look at the 2-yr vs. 10-yr  and 2-yr vs. 30-yr Treasury spreads shown below.  They are at historic highs, and the government knows it.  How long will they be able to keep feeding people lies?  How long will people keep believing them?
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Watch for these indexes to drop:

Chinese Shanghai Composite Index: 3,003.40 (change of 8.07% from July 20, 2009 base value of 3,266.92)
Shenzhen Stock Exchange Component Stock Index (SSE): 12,213.54 (change of 8.73% from July 20, 2009 base value of 13,381.22)
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Here are today’s numbers for the economic indicator:

1) Gold = $1,112.60
2) Silver = $16.21
3) Dollar Index = 80.56
4) Oil = $80.16
5) S&P 500 Index = 1,108.01
6) 3-month Treasury Bill yield = 0.08
7) 3-month OIS = 0.16

HEI = 33.68

(A value of under 100 indicates deflation, while over 100 indicates inflation – as referenced to Sept. 12, 2008…the day before Lehman Brothers collapsed)

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Here are the numbers for the day:

Dollar Index adjusted indexes:
Dow = (10,383.38) x (0.8056) = 8,364.85
S&P 500 = (1,108.01) x (0. 8056) = 892.61
Nasdaq = (2,242.03) x (0. 8056) = 1,806.18

3-month Treasury: 0.08

2-year Treasury: 0.88

10-year Treasury: 3.79

30-year Treasury: 4.73

2-yr vs. 10-yr Spread (Target > 273): 291 basis points – (Danger Zone)

2-yr vs. 30-yr Spread (Target > 369): 385 basis points – (Danger Zone)

3-month LIBOR: 0.25

3-month EURIBOR: 0.66

3-month OIS: 0.16

TED Spread: 17 basis points

LIBOR/OIS Spread: 9 basis points

Dollar Index: 80.56

Volatility Index: 19.94

JPY-EUR Exchange Rate (Target < 115): 123.941

JPY-GBP Exchange Rate (Target < 145): 141.1521– (Danger Zone)

JPY-USD Exchange Rate (Target < 90): 91.18

USD-EUR Exchange Rate (Target < 1.25): 1.3593

USD-CNY Exchange Rate (Target > 7.0): 6.8265

Warmly,

Brad

Comments or questions?  brhamill@hamill.com

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