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KINGSTON, NY, 13 May 2009 -- The biggest financial bubble in history is being inflated in plain sight, said Gerald Celente, Director of The Trends Research Institute. "This is the Mother of All Bubbles, and when it explodes," Celente warns, "it will signal the end to the boom/bust cycle that has characterized economic activity throughout the developed world."
Either unwilling or unable to call the bubble by its proper name, the media, Washington and Wall Street describe the stupendous government expenditures on rescue packages, stimulus plans, buyouts and takeovers as emergency measures needed to salvage the severely damaged economy.
"All of this terminology is econo-jargon," said Celente. "It's like calling torture 'enhanced interrogation techniques.'
Washington is inflating the biggest bubble ever: the 'Bailout Bubble.' "This is much bigger than the Dot-com and Real Estate bubbles which hit speculators, investors and financiers the hardest. However destructive the effects of these busts on employment, savings and productivity, the Free Market Capitalist framework was left intact. But when the 'Bailout Bubble' explodes, the system goes with it."
The economic framework of the United States has been restructured. Federal interventionist policies have given the government equity stakes, executive powers and management control of what was once private enterprise. To finance these buyouts, rescue and stimulus packages -- instead of letting failed businesses fail and bankrupt banks and bandit brokerages go bankrupt -- trillions of dollars are being injected into the stricken economy.
Phantom dollars, printed out of thin air, backed by nothing ... and producing next to nothing ... defines the "Bailout Bubble." Just as with the other bubbles, so too will this one burst. But unlike Dot-com and Real Estate, when the "Bailout Bubble" pops, neither the President nor the Federal Reserve will have the fiscal fixes or monetary policies available to inflate another.
With no more massive economic bubbles left to blow up, they'll set their sights on bigger targets. "Given the pattern of governments to parlay egregious failures into mega-failures, the classic trend they follow, when all else fails, is to take their nation to war," observed Celente.
Since the "Bailout Bubble" is neither called nor recognized as a bubble, its sudden and spectacular explosion will create chaos.
A panicked public will readily accept any Washington/Wall Street/Main Stream Media alibi that shifts the blame for the catastrophe away from the policy makers and onto some scapegoat.
"At this time we are not forecasting a war. However, the trends in play are ominous," Celente concluded. "While we cannot pinpoint precisely when the 'Bailout Bubble' will burst, we are certain it will. When it does, it should be understood that a major war could follow."
World War III:
In the first half of Tuesday night's show, political scientist and expert in relocation for personal security, Joel Skousen warned that WWIII was in the works for the United States, China, and Russia. One of the main purposes behind staging such a conflict is to scare Americans into giving up their sovereignty to a new global government, he suggested.
This goes on, and on, and on... until something stops it. since the 1970's we have always relied on a "New Market" to drive a Bubble to bring about a way to end a recession. Usually, it didn't have to be a big Bubble, just enough to get people working. As years went by, Dot Com Bubbles, Energy Bubble, Housing Bubble.. all saved us from a recession, and each Bubble was bigger then the last.. until the whole scheme pops and we see our first real deflationary spiral since the Great Depression. I think the administration hoped for a "Green Energy Bubble" .. but with unemployment and dollar devaluations.. who can afford the new Green Energy? not many.
IMO, from what I have researched and understand about this particular economy.. we will continue with a Deflationary Spiral until a time comes where the Government manages to increase wage growth via a new technological Bubble.. or a major increase in economic output is needed due to, say, a very large war. I believe the extent of damage to the Economy is drastic and beyond repair of typical interest rate changes and capital expansions... a failing economy that could prolong a recession by 10 years or more, regardless of the drastic "bailouts" the government is promising. They only create Zombie Corporations that don't produce wealth.