The credit collapse, martial law and you
A personal credit collapse of truly monolithic proportions is starting to become a reality across the country. While the very concept of a national credit (read debt) collapse was purely a subject of speculation and debate in years past, it has now becoming a living reality and a simple peek into the various channels of mass communication in America will bear this out.
There was a time not too long ago when information outlets such as Gold Eagle were the only ones discussing the coming credit crisis. Today, virtually everyone is barraged with a steady diet of commercials on radio, television and Internet advertising ways to "get out of debt" and "reduce your mortgage payments. This mostly falls under the category of "too little too late." Even worse, in many instances it is simply a matter of exchanging an existing debt for another, in some cases at an even higher rate of interest.
For example, a radio commercial for a local Nissan car dealer here in the Wilmington, N.C. area is advertising new cars with an added bonus: the buyer can have his credit card debt completely extinguished just for agreeing to buying a new Nissan at 0.9% interest. The commercial concludes with these words, "Credit card debt is a serious issue in this country, and here at [name deleted] we aim to do something about it while helping you walk away with a new car." This has got to be a first in the annals of American advertising-trading in one debt for another's and in the name of "saving" the country from financial collapse!
The lending institutions which only two or three years ago were handing out free credit cards to everyone with a pulse have given way to the inevitable result of trying to reel in outstanding debt any way possible. Profligate spending by the average American debtor over the past few years has gone a long way in crippling the economy and will only hasten the unavoidable K-wave depression descending upon us. America is truly paying for yesteryear's playing.
Another proxy that America's credit card debtors are in for a rude awakening is the fact that American Express has reduced its amortizing grace period for cardholders from 25 to 20 days, the first such reduction in memory. This clearly represents an effort to stay ahead of the downward curve on the part of America's most prestigious personal lender.
Perhaps the most sinister aspect of the yawning chasm that is America's collective personal credit debt is the fact that the average rate of interest on most bank-issued credit cards is an usurious 18%-23%! These rates were a product of the hyper-inflationary, high interest rate period of the late 1970s and early '80s, yet the rates on most major credit cards were never dropped even though the natural rate of interest has since fallen extraordinarily low. This greedy tactic on the part of banks has gone a long way in bringing America to the threshold of financial disaster.
Martial law is never a pleasant subject to discuss, especially since the mere mention of the words automatically brings accusations of "paranoia," "conspiratorial delusions," "lunacy," or some other unpleasant moniker. But the fact remains that with each passing month America is sliding closer into a totalitarian dictatorship controlled by military/police rule. Already we see undeniable signs that America is sliding headlong into the path of military rule. For example, in a recent headline news article published by Time Warner, a photograph was shown of an airport security officer dressed in military black from head to toe and wielding a machine gun. A machine gun! Even considering the heightened tensions in response to the Trade Tower bombing, is this really necessary? When was the last time you walked into a U.S. airport to be greeted by military men with automatic weapons? This only happens in Third World countries already under the control of a military state.
What, you may ask, does this have to do with the developing credit collapse? Our response: Everything. The fact that martial law is slowly beginning to emerge as an accepted extension of the federal government is a sure sign that Washington fears the social and political ramifications of what the credit collapse will bring. This is truly a fearful sign and one that should cause every American to reevaluate his trust in the "system" which has as its basis certain Constitutional guarantees of personal and financial freedom. Piecemeal, these Constitutional guarantees are being stripped away at an alarming pace.
The latest from U.S. President George Bush is that he has asked the nation's governors to post National Guard troops at airports this week as a first step to take federal control of airline security and coax Americans back into the skies. "This nation will not live in fear," he told the Associated Press. What he didn't explain is how the sight of armed troops walking the corridors of the nation's airports will do anything but instill fear and paranoia.
Bush's plan envisions stationing 4,000-5,000 troops at the nation's 420 commercial airports for up to six months while the federal government prepares to step in. Also, many more in-flight air marshals would be trained and a federal agency would be set up to oversee the screening of passengers and luggage. In other words, more invasion of privacy. The very fact that air travel is being federalized and regulated by military rule is proof that a de facto martial law is already in place since restriction of interstate and international travel is the heart and soul of martial law. Also, keep in mind that the term martial law literally means rule by military force. If 4,000-5,000 heavily armed troops walking the nation's airports and inspecting luggage isn't rule by force then we don't know what is.
"When you're in a time of war, you don't question the commander-in-chief," said Minnesota Gov. Jesse Ventura. He may as well have said "martial law" instead of "war."
The question that should now be swimming in every gold investor's mind is, "What will this mean for my precious metals holdings? Will they be subject to confiscation or other forms of control?" This is doubtful, because a.) gold as an investment represents but a mere drop in the bucket for most Americans, and b.) the tale of the gold tape is undeniably one of insider accumulation, which means there are no existing plans to control the gold market a 'la FDR during the Great Depression. The tape and chart would definitely show it if the government had any plans of controlling gold since it would show up in the form of massive selling.
In truth, gold remains the sole form of financial wealth beyond the long and ever-growing reach of a government bent on rule by military force. The depression of tomorrow will be one in which gold alone reigns supreme as the sound instrument of monetary transaction and storehouse of wealth. Get it today-at bargain basement prices-while you still can.
October 1, 2001