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George Soros, IMF & The World Bank: Warnings Of An Impending Economic Collapse (TZA, VXX, SDS, SH)

January 25th, 2012

Michael Snyder: Over the past couple of weeks, George Soros, the IMF and the World Bank have all issued incredibly chilling warnings about the possibility of an impending economic collapse.  Considering the power and the influence that Soros, the IMF and the World Bank all have over the global financial system, this is very alarming.  So are they purposely trying to scare the living daylights out of us?  Soros is even warning of riots in the streets of America.  Unfortunately, way too often top global leaders say something in public because they want to “push” events in a certain direction.  Do George Soros and officials at the IMF and World Bank hope to prevent a worldwide financial collapse by making these statements, or are other agendas at work?  We may never know.  But one thing is for sure – many of the top financial officials in the world are using language that is downright “apocalyptic”, and that is not a good sign for the rest of 2012.

Right now, George Soros is saying things that he has never said before.  Just check out what George Soros recently told Newsweek….

“I am not here to cheer you up. The situation is about as serious and difficult as I’ve experienced in my career,” Soros tells Newsweek. “We are facing an extremely difficult time, comparable in many ways to the 1930s, the Great Depression. We are facing now a general retrenchment in the developed world, which threatens to put us in a decade of more stagnation, or worse. The best-case scenario is a deflationary environment. The worst-case scenario is a collapse of the financial system.”

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Later on in that same article, Soros is quoted as saying that we could soon see the U.S. government using “strong-arm tactics” to crack down on rioting in the streets of major U.S. cities….

As anger rises, riots on the streets of American cities are inevitable. “Yes, yes, yes,” he says, almost gleefully. The response to the unrest could be more damaging than the violence itself. “It will be an excuse for cracking down and using strong-arm tactics to maintain law and order, which, carried to an extreme, could bring about a repressive political system, a society where individual liberty is much more constrained, which would be a break with the tradition of the United States.”

It almost sounds like George Soros is anticipating the same kind of a breakdown of society that many survivalists and preppers are getting ready for.

So how bad are things going to get?

Well, George Soros is publicly warning that the coming financial crisis could end up being even worse than 2008.  Just check out the following quotes from him that appeared in a recent Businessweek article….

Billionaire investor George Soros said Europe’s sovereign-debt woes are “more serious” than the financial crisis of 2008 and that the world faces the prospect of a “vicious circle” of deflation.

“We have a more dangerous situation now than in 2008,” Soros, 81, said in response to a question at an event in the southern Indian city of Bangalore today. “The crisis in Europe is more serious than the crash of 2008.”

But George Soros is not the only one issuing these kinds of warnings.

Once again, the head of the IMF, Christine Lagarde, has made a speech in which she openly warned that we are heading for a repeat of the “1930s”.

She told an audience in Berlin on Monday that the globe is facing “a 1930s moment, in which inaction, insularity and rigid ideology combine to cause a collapse in global demand”.

During the speech she called for a trillion more dollars to support financially troubled governments, and she made the following statement….

“It is not about saving any one country or region. It is about saving the world from a downward economic spiral.”

As I wrote about the other day, the World Bank has also been using apocalyptic language about the global financial situation.  In a shocking new report, the World Bank revised GDP growth estimates for 2012 downward very sharply, it warned that Europe could be facing financial collapse at any time, and it instructed the rest of the world to “prepare for the worst.”

The lead author of the report, Andrew Burns, said that the “importance of contingency planning cannot be stressed enough” and that if there is a major financial crisis in Europe the entire globe will be deeply affected….

“An escalation of the crisis would spare no-one. Developed- and developing-country growth rates could fall by as much or more than in 2008/09.”

So should we be alarmed that George Soros, the IMF and the World Bank are all proclaiming that a financial nightmare could be just around the corner?

Of course we should be.

Whether their motives are pure or not, they are telling the truth about the global financial situation in this case.  As I have written about so frequently, there are a whole host of signs that indicate that we could be on the verge of a major global recession.

A lot of folks in the investment world are warning that hard times are about to hit us as well.  For example, the following is what legendary investor Joseph Granville recently told Bloomberg Television….

Joseph Granville, whose “sell everything” call in 1981 sparked a decline in U.S. stocks, said the Dow Jones Industrial Average (INDU) will drop toward 8,000 this year because of waning momentum and volume.

“Volume precedes prices,” Granville, 88, a technical analyst who has been publishing the Granville Market Letter from Kansas City, Missouri for about 50 years, said in an interview on “Street Smart” on Bloomberg Television. “You are seeing much lower volume. That tells you that prices are going to go much lower, much lower than most people think possible and very few people have projected.”

Considering all of the warnings out there, it only seems prudent to prepare for the worst.

But unfortunately, a lot of people are just going to leave their holdings sitting out there like a dead duck, and they are going to be absolutely devastated by the coming financial tsunami.

Those that believe that the United States can somehow escape the coming financial storm don’t really know what they are talking about.

In fact, there was very troubling news for the U.S. dollar just the other day.  It was announced that India will start paying for its oil from Iran in a currency other than U.S. dollars (NYSEArca:UUP).

But this is just another sign that the rest of the world is starting to reject the U.S. dollar (NYSEArca:UDN).  For decades, the U.S. dollar has been the reserve currency of the world and this has given us a tremendous advantage.  Unfortunately for us, that is now changing.

U.S. newspapers are not talking about what is going on, but mainstream newspapers in Europe are.  Right now, some of the biggest countries in the world are working on plans to quit using U.S. dollars for the buying and selling of oil.

The following comes from a recent article in The Independent….

In the most profound financial change in recent Middle East history, Gulf Arabs are planning – along with China, Russia, Japan and France – to end dollar dealings for oil, moving instead to a basket of currencies including the Japanese yen and Chinese yuan, the euro, gold and a new, unified currency planned for nations in the Gulf Co-operation Council, including Saudi Arabia, Abu Dhabi, Kuwait and Qatar.

Secret meetings have already been held by finance ministers and central bank governors in Russia, China, Japan and Brazil to work on the scheme, which will mean that oil will no longer be priced in dollars.

The plans, confirmed to The Independent by both Gulf Arab and Chinese banking sources in Hong Kong, may help to explain the sudden rise in gold prices, but it also augurs an extraordinary transition from dollar markets within nine years.

This is a very big deal, and if this gets pulled off it is going to have devastating consequences for the U.S. dollar and for the U.S. economy.

But of course when it comes to troubles for the U.S. financial system, there are a whole host of issues that could be talked about.

An environment for a “perfect storm” is developing, and most Americans have absolutely no idea what is about to happen.

Fortunately, there are some researchers out there that are working hard to sound the alarm bells.  For example, the following quote comes from a recent interview with Gerald Celente….

I believe that we have to watch out for something along the lines of an economic martial law. The European system is in collapse. The financial system in the United States is just as tenuous, if not more, and I believe they will not admit there will be a financial crash but rather they will use a geo-political issue to get the people in a state of fear and hysteria whereby they’ll then call a bank holiday or devaluation of the currency, or a hyperinflation of the currency, and blame it on somebody else.

It would be wise to listen to what experts such as Gerald Celente are saying.

Now is the time to take stock of where you are at and to make plans for the coming year.

Just because things have “always” been a certain way does not mean that they will continue to be that way.

Just because certain things have “always” worked in the past does not mean that they will continue to work in the future.

Our world is experiencing fundamental changes.  It is changing at a faster pace than we have ever seen before.  The way that we all live our lives five or ten years from now will be vastly different from how we live our lives today.

This will be a very challenging time to be alive, but it is also going to be a very exciting time to be alive.

So what do all of you think is going to happen in 2012?

Please feel free to leave a comment with your thoughts below….

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Written By Michael Snyder From The Economic Collapse

Michael has an undergraduate degree in Commerce from the University  of Virginia and a law degree from the University of Florida law school.  He also has an LLM from the University of Florida law school. Michael  has worked for some of the largest law firms in Washington D.C., but now  is mostly focus on trying to make a difference in the world.


ETF BASIC NEWS, NYSE:SDS, NYSE:SH, NYSE:SPXU, NYSE:TZA, NYSE:UDN, NYSE:UUP, NYSE:VXX


 

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  1. steve brassey
    April 20th, 2012 at 14:24 | #1

    soros is so over-rated; if i ever hear again how he broke the cable i will throw up; the trade was druckenmiller’s; also, why don’t u ask soros about his non existant conscience and why he chose to take advantage of the mfglobal train wreck; what a scummy guy, along with my other 2 favorite hypocrites, buffett and munger

  2. DRS
    April 11th, 2012 at 01:38 | #2

    Commodities have been rising since 2001 (with a dip in 2008): http://www.indexmundi.com/commodities/

    Western spending has peaked as baby-boomers retire but the world population is still growing – What about exporting goods and service around the world?

    Will any international shares survive?

  3. The General
    March 14th, 2012 at 14:00 | #3

    Another good video to watch on youtube “Money as Debt” confirms the fed is not a government agency at all but a private group of investment bankers, who’s main goal is to control all commerce, making sure the lions share of profits goes to them.
    Vote for Ron Paul for President and put an end to such shenanigans.

  4. david pidcock
    February 8th, 2012 at 01:15 | #4

    U.S. MONEY FACTS LETTER OF TRANSMITTAL

    SEPTEMBER 21, 1964.

    To Members of the Subcommittee on Domestic Finance:

    Transmitted herewith for the use of the Subcommittee on Domestic Finance of the Banking and Currency Committee, and other members of the committee and the Congress as well as the general public, is a series of questions and answers on the basic workings of our monetary system. It is a supplement to “A Primer on Money” and is designed to highlight in question and answer form the basic points brought out in the “Primer.” It. has also been indexed so as to facilitate its use. It is hoped that “Money Facts” will prove useful to students and all others interested in further study of and improvement in our mone¬tary system and that it will stimulate serious thought, research and discussion of the critical issues involved.
    WRIGHT PATMAN, Chairman.

    MONEY FACTS
    169 Questions and Answers on Money—A Supplement to A Primer on Money

    CHAPTER I

    PREFACE

    1. Who has the right to create money in the United States?
    Under the Constitution, it is the right and duty of Congress to create money. It is left entirely to Congress.

    2. To whom has the Congress delegated this money-creating right?
    To the banking system, that is, to the Federal Reserve System and to the commercial banks of the country.

    3. Why is the money-creating power important?
    Because, by creating money, banks provide the exchange media which the economy needs to prosper and grow. Since the growth and proper functioning of the U.S. economy require increasing amounts of money over the years, those who control the amount of money exer¬cise great power over business activity, the incomes people earn, and our economic strength.

    4. Why was the banking system given the right to create money?
    The reasons are mainly historical. Still the banks do perform a service in creating money. For once the money and credit is created someone must decide whom to give the money and for what purposes. This the banks do. And bank earnings are the return for wise and proper placing of the money supply.

    5. What is the Federal Reserve System?
    The Federal Reserve System is the “central bank” of the country, composed of 12 regional Reserve banks, and the Federal Reserve Board in Washington and controls the ability of our commercial banks to create money and credit. The Federal Reserve also controls the level of interest rates.

    6. Does Congress supervise Federal Reserve policymaking?
    No. In practice the Federal Reserve is “independent” in its policy making. The Federal Reserve neither requires nor seeks the ap¬proval of any branch of Government for its policies. The System it¬self decides what ends its policies are aimed at and then takes what¬ever action it sees fit to reach those ends.

    7. What problems are raised by an “independent” Federal Reserve?
    There are two major problems. One is the problem of political responsibility for the country’s economic policies. The other is the problem of final control over the Government’s actions in the economic sphere.

    8. What is the problem of political responsibility?
    Since the Federal Reserve is independent it is not accountable to anyone for the economic policies it chooses to pursue. But this runs counter to normally accepted democratic principles. The President and Congress are responsible to the people on election – day for their past economic decisions. But the Federal Reserve is responsible neither to the people directly nor indirectly through the people’s elected representatives. Yet the Federal Reserve exercises great power in controlling the money-creating activities of the commercial banks.

    9. Why is final control of economic policy a problem?
    Because with an “independent” Federal Reserve, Congress and the President can be moving in one direction while the Federal Reserve is moving in the other. ‘The result is sometimes no policy at all. At other times, it leads to the Federal Reserve’s neutralising the President’s economic policies. This very possibility caused President Johnson to request the Federal Reserve in his 1964 Annual Economic Report to Congress not to nullify his efforts to reduce unemployment and raise incomes. Should the President have to ask any Government agency to go along with his policy as approved by Congress? Obviously not.

  5. david pidcock
    February 8th, 2012 at 01:05 | #5

    “It (the Great Depression) was not accidental; it was a carefully contrived occurrence. The international Bankers sought to bring about a condition of despair here so that they might emerge as rulers of us all…We have in this country one of the most corrupt institutions the world has ever known. I refer to the Federal Reserve Board. This institution has impoverished the people of the United States and has practically bankrupted our government. It has done this through the corrupt practices of the money vultures who control it. A superstate controlled by international bankers and international industrialists acting together to enslave the world for their own pleasure.” – Louis McFadden, D-PA

    On June 10th, 1932, Congressman Louis T. McFadden, Chairman of the House Banking and Currency Committee, addressed the House. Congressional Record 12595-12603.
    “We have in this country one of the most corrupt institutions the world has ever known. I refer to the Federal Reserve Board and the Federal Reserve Banks. Some people think the Federal Reserve Banks are U.S. government institutions. They are private credit monopolies; domestic swindlers, rich and predatory money lenders which prey upon the people of the United States for the benefit of themselves and their foreign customers. The Federal Reserve banks are the agents of the foreign central banks. The truth is the Federal Reserve Board has usurped the Government of the United States by the arrogant credit monopoly which operates the Federal Reserve Board.”

    On May 23, 1933, Congressman, Louis T. McFadden, brought formal charges against the Board of Governors of the Federal Reserve Bank system, The Comptroller of the Currency and the Secretary of United States Treasury for numerous criminal acts, including but not limited to, conspiracy, fraud, unlawful conversion, and treason. The petition for Articles of Impeachment was thereafter referred to the Judiciary Committee and has yet to be acted on.

  6. david pidcock
    February 8th, 2012 at 01:02 | #6

    Between 1799 and 1802, Thomas Jefferson, stated, on more than one occasion that: “’I believe that banking institutions are more dangerous to our liberties than standing armies. If the American People ever allow the (Private) banks to control the issuance of their currency, first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the people of all property, until their children will wake up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to Congress and the people to whom it properly belongs….Single acts of tyranny may be ascribed to the accidental opinion of a day, but a series of oppressions, begun at a distinguished period, unalterable through every change of ministers, too plainly prove a deliberate, systematic plan of reducing us to slavery.”

    Though some dispute it, it is reported that, on September 1st 1894, the following memo was sent out by the American Bankers Association: “We will not renew our loans under any consideration. On September 1st we will demand our money. We will foreclose and become mortgagees in possession. We can take two-thirds of the farms west of the Mississippi, and thousands of them east of the Mississippi as well, at our own price…Then the farmers will become tenants as in England…”

    Confirmed by Milton Friedman who said: “The Federal Reserve definitely caused The Great Depression by contracting the amount of currency in circulation by one-third from 1929 to 1933″ And Denis Healey, a former British Secretary of Defence and Chancellor of the Exchequer who said: “(Such) World events do not occur by accident: They are made to happen, whether it is to do with national issues or commerce; and most of them are staged and managed by those who hold the purse strings.”

  7. February 8th, 2012 at 00:38 | #7

    “Many economists rail against “wage push.” and it’s true that wages have risen by 2,700% over the past 50 years. But in the same period government tax revenues went up by 3,400% and net interest by 26,OOO%! (More than 9 times that for the wages of most men and women) And yet most of the economic textbooks that deplore rising wages don’t even mention these tax and interest pushes. And it’s not because they are complex ideas but ¬rather, that they are so simple and obvious—and because it would be so embarrassing for economists to admit they’ve made a boner of such magnitude: in that their theory of monetary policy violates the basic principles of all known scientific laws and logic.”

    The formula for Interest pushed Inflation is as follows:-
    The Money Supply (M) is issued as a Debt (D).
    Therefore M = D.
    However, the debt has to be repaid with interest (i).
    So the formula expands thus: M + (x) = D + i
    The money supply M must remain in equilibrium with Debt plus interest (D + i), through the increase represented by (x).
    The variable (x) is solved as (r) the Rate of Inflation (i.e. an increase in the money supply) Copyright @ Latticework Management Consultants 2008.

  8. February 8th, 2012 at 00:35 | #8

    In the summer of 1988, John Hotson, Professor of Economics, in his capacity as Chairman of C.O.M.E.R. for the Committee On Economic & Monetary Reform, said in that organization’s news letter: “Here we go again! John Crow, the new head of the Bank of Canada and Allan Greenspan, the new man at the Federal Reserve Board have given a lot of speeches and interviews lately saying that if there is one thing they can’t stand it’s inflation. So they are going to get inflation down to zero any-day-now, even if it kills somebody [or every body]! Yes, they are going to haul inflation down to zero with high interest rates. Now that’s never worked before. The fact is that, we’ve had inflation in every year, but one, since the Bank of Canada was invented in 1934. The facts also suggest that if our political leaders allow Greenspan and Crow to play doctor with the economy that the result will be a replay of 1979-83 if we are lucky or a re-run of 1929-39 if we are not.

    When you get right down to it, there are at least eight things wrong with the policy of trying to stop the price level from increasing by increasing the rate of interest.
    (1) The Policy is immoral.
    (2) The policy is illegal.
    (3) The Policy is irrational.
    (4) The Policy has surrendered North America’s leadership to the Japanese.
    (5) The Policy has made all our problems worse.
    (6) The – Policy has caused the large U.S., Canadian [and British] foreign trade deficits.
    (7) The Policy has increased the [fractional reserve] banking systems natural propensity to self destruct. And
    (8) The Policy has resulted in a world wide debt crisis where our only choices appear to be between, world wide debt repudiation, depression, and accelerating inflation. Except for these shortcomings, high interest rates are a pretty good policy.”

  9. Chris
    January 27th, 2012 at 12:54 | #9

    This just solidifies my fears and justifies my actions for preparing the way I have been. I sold all my stocks and bought silver bullion. I built a deep pantry and continue to stock up. I have lowered my monthly overhead and cut expenses on every level. I have paid off or paid cash for everything for the past two years. I bought 2.6 acres of farmland and will be up and running this year towards self sustainable living. Over the last two years, I have been mocked I am sure by family and friends. Doesn’t matter. I feel great and sleep easy at night knowing that I don’t have to panic on day 1. Day 180 may be a different story! Cheers.

  10. Hopey & Changey
    January 25th, 2012 at 17:15 | #10

    I agree with all of the above and with the recent news from the FED today, declaring war on retirees, pensioners, savers, unemployed, and those living on fixed incomes, these developments look to be increasing rather rapidly. Major Capitol Controls are coming next, think 401ks being taken over. It’s not going to be fun and sadly most American’s will be wiped out.

  11. Hopey & Changey
    January 25th, 2012 at 17:14 | #11

    I agree with all of the above and with the recent new from the FED today, declaring war on retirees, pensioners, savers, unemployed, and those living on fixed incomes, these developments look to be increasing rather rapidly. Major Capitol Controls are coming next, think 401ks being taken over. It’s not going to be fun and sadly most American’s will be wiped out. Obama 2012!!

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