U.S. Already in Technical Default-Gregory Mannarino
By Greg Hunter’s USAWatchdog.com
Analyst Gregory Mannarino is worried about the out of control debt in America. Mannarino says, “The United States is already in technical default regarding its debt because if it were not for the Fed buying all this debt, we’d be in actual default, which is coming.” When the bond market bubble blows up, Mannarino thinks, “People are going to be destroyed here—destroyed from a financial standpoint.” It is an official “open ended” policy for the Fed to buy $85 billion in debt each and every month. Mannarino says, “This is a very dangerous game the Fed is playing. It is very scary. They are creating a greater and greater imbalance between the supply and demand for the U.S. dollar. . . . Inflation is starting to kick in, and it’s just the beginning.” Join Greg Hunter as he goes One-on-One with Gregory Mannarino from TradersChoice.net.
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About the Author
Greg Hunter
Greg is the producer and creator of USAWatchdog.com. The site’s slogan is “analyzing the news to give you a clear picture of what’s really going on.” The site will keep an eye on the government, your financial interests and cut through the media spin. USAWatchdog.com is neither Democrat nor Republican, Liberal or Conservative. Before creating and producing the site, Greg spent nearly 9 years as a network and investigative correspondent. He worked for ABC News and Good Morning America for nearly 6 years. Most recently, Greg worked for CNN for shows such as Paula Zahn Now, American Morning and various CNN business shows.
I have most of my 401K funds in bond type options. What does this do to me and people in my position?
Dave,
As interest rates go up bond values will go down. The values could go down dramatically in high or hyperinflation. Please do some research on your own.
Greg
http://useconomy.about.com/od/bondsfaq/f/Treasury_Bonds.htm
That should help. My Tsp(401k) is in short term treasuries (2 years)
I don’t know if they are as volatile. I don’t know if anything is very safe right now,
earltwitty,
Gold and silver coins are a must.
Greg
I have some.. Not enough
Get out NOW!
Thanks for the video Greg. Any chance you could do podcasts too? Would be awful handy.
Thanks Jared. Maybe someday but not now.
Greg
greg if my kids own series ee bonds less then 20yrs old should i sell. my oldest is 22 my youngest is 17. these are gifts from family. at least $800 and up face value, per child. you’re great. keep up the good work. i do’nt watch the media anymore. no trust. you ,greg and lot of others that you interview is exactly who i watch, thank you so much
Bob,
All the experts I talk with agree that bonds, especially government bonds will be destroyed by inflation.
Greg
So I was in a similar situation where my kids inherited 30 year tbonds from the mid to late 90s. I was able to download from a government website a bond tracker programs that lets you know how you are doing on your interest rates. My average to date was .97%-1.6% depending on the age. Now doing some quick math, on a $50 bond, I had about $38 coming back to me if I cashed in today. However, if I waiting another 10 years I would get another $8. Now with the average rate of inflation over the past 10 years, I figured I was losing about 18% per bond. With inflation only going to get worse, I felt the dollar was better spent cashing in and putting the money towards silver and giving that to my kids ….
Greg on Greg again. I thoroughly enjoy Greg, Greg! He’s one of the good guys. Oh…so are you Greg!
Thank you Foolio.
Greg
Greg:
For your info, the hearing in Horsham, UK is going forward as of this moment. What this may mean is that a new investigation into the real cause of 9/11 may take place. This could mean the murderers in US govt could be brought to trial. The real story behind 9/11 will eventually come out. I hope I live long enough to see this shadow govt brought down before some of these sob’s die….. Betts
William Betts,
Please keep posting updates and links if you can. This is very important!!! Thank you very much.
Greg
Wow, Wow, Wow, if Mr. Mannarino is only 1/4 right we are headed for economic collapse, reserve currency change and then war, it just will take a little longer for your guest scenarios to play out. Still a puzzle why the MSM doesn’t discuss any of this and Wall Street and CNBC goes right on preaching a “chicken in every pot”. Frankly, none of this makes any sense, its like a train or plane without any pilot and or destination. You would think some members of the elite would take measures to try and stop this decline but no one speaks out, maybe afraid of being dismissed from the group. I don’t know but a blind man can see all this coming. Enjoyed Mr. Mannarino and his charts. Thanks for getting back up after the cowardly attack(s).
If you have no soul, $h-t for brains & a psychopathic lust for the Franklin’s then being a ‘useful highly paid idiot’ for TPTB then it’s just part of the job which is why you’ll never much real truth on Communist News Network.
why isnt the trader talking about the amount of money the fed gave to our BANKSTERS OVER 20 TRILLION DOLLARS, also the purchase of mortgage backed securities total 40 billion per month. This is what started the mess of all our debt, also allowing CHINA TO PRODUCE EVERYTHING so we became the largest debtor nations, and the constant wars costing us over 4 trillion dollars. when are you going to talk about this? please dont defend the republicans considering henry paulsen bush cheney and company deregulated the entire banking industry and started 2 wars without considering the consequences. problem is obama is continuing the same insane policies.
Good Morning Greg and all subscribers!
I am happy to see you back online, I was jonesin’ for some reality last week.
Anyway, I find it ironic (not really) that at my desk this morning a flood of new price schedules have come in from suppliers. Prices have increased, but not by a couple bucks. MANY major items have doubled in price! I am in the automotive after-market and didn’t see this coming since prices rose substantially not too long ago.
Metals ARE precious!
Thank you Brody for the comment. It’s good to be back on-line.
Greg
This is the time some one with some guts in the MSM
Should ask Washington what is the big deal about cutting 85 billion?
And reference the 85 billion a month the Fed prints.
That would start some fire works!!
Washington is blowing smoke as usual. I think this is the only way we can fix the debt. What I feel is going on is that they banks and others are positioning themselves and well placed to the coming deflated US economy. Is this “distraction politics” at it’s best?
This economic condition is nothing new … a bubble pattern pushed by cheap money …. to reap profits and shift risk to government through FED bond buying….
Maybe the sequester is the only way to cut the budget but we are truly a walking bankrupt zombie eating our own brains to keep walking forward mumbling ….. “Ponzi, ponzi … feed me, feed me”
Greg.
How many times can you bring this information into the light that so many do not see? People have to be blind to not understand the direction of our country and it hurts to watch so many moving in mass to self extermination. Not trying to be an alarmist, but when this all hits the fan, most will not have any idea what is happening. I had a discussion with my nieces husband last week and all he feels he can do is try to live the American Dream and live the good life. There is no urgency in the voices of news people who attempt to relay this news. It seems it will be a side bar until it is the end, then there will be no news but the government news and we already know what that is. Good interview Greg. Keep it up.
NC,
It is my hope that more and more will see the light of this oncoming train and protect their families from financial ruin. Thank you for weighing in.
Greg
How is it that so many people can be sold on something made of paper, and think that somehow it is real value?
We so quickly forget the great advice of those from the past.
“The hand that lends is above the hand that borrows”
“The borrower is always servant to the lender”
“Only Gold and Silver are Money,Everything else is Credit”-John Pierpont Morgan
“If you do not hold it, you do not own it” Did John Corzine not teach everyone that?
As every other fiat paper currency in all of history has collapsed, so will the Federal Reserve Note. It is not a matter of if, but a matter of when and how.
It is IMPOSSIBLE to borrow your way out of debt.
As far as I am concerned, the hand writing is on the wall: our politicians have demonstrated that they will do everything they can do in an effort to maintain the status quo and their hold on power, even if that means bleeding the public dry of evey penny, nickle, and dime.
With that in mind, I am becoming increasingly worried and convinced that state and/or federal governments will either confiscate gold outright, or impose a windfall profit tax on the sale of all precious metals, a tax so severe that it will penalize those holding the metals, and negate any wealth preservation one might have had prior to the tax. The Precious Metals Purchasing Act, which is slowly working its way through the Illinois Assembly, is laying the groundwork for either future confiscation or taxation. I can’t think of any other purpose for this act.
I realize that many pundits recommend that one ought to avoid paper gold and silver, especially the SLV and GLD ETFs. But, if I am correct about confiscation and/or a windfall profit tax, what good does it do to have the physical metal (baring a total SHTF scenario)?
I’m starting to think that gold mining stocks, especially those that give a dividend, might be a good alternative to owning physical metal, although they might still be subject to a windfall profit tax.
Also, does the advice against owning paper gold and silver pertain to those ETFs provided by Sprott Asset Management?
Since the dollar will probably loose considerable purchasing power over the next few years, placing some of a person’s wealth in the currency of a less profligate country (like Canada, Australia, or New Zealand) might be another way get around the twin threats of confiscation and windfall profits tax.
Any ideas?
Greg
Thank You for your work!
“…There is no nation on earth powerful enough to accomplish our overthrow. … Our destruction, should it come at all, will be from another quarter. From the inattention of the people to the concerns of their government, from their carelessness and negligence, I must confess that I do apprehend some danger. I fear that they may place too implicit a confidence in their public servants, and fail properly to scrutinize their conduct; that in this way they may be made the dupes of designing men, and become the instruments of their own undoing.” — Daniel Webster, June 1, 1837
“We’ve witnessed a fire sale of American liberties at bargain basement prices, in return for the false promise of more security… The America being designed right now won’t resemble the America we’ve been defending… The danger isn’t that Big Brother may storm the castle gates. The danger is that Americans don’t realize that he is already inside the castle walls.” — Wayne LaPierre
Greg,
I just want to sincerely thank you for your site. I have learned so much over the last few months. The information has for the most part scared the hell out of me, but still has been a good thing. Greg Mannarino is spot on as usual. Thanks to him and his work as well. Damn scary times we live in, of that we should all have no doubt. Yah bless and keep sounding the alarms.
Doug
Thank you Doug Ferguson for your support.
Greg
Most metal bugs fail to see, the trillions are already in the system, most went to the banks around to world to offset their losses, it isn’t like the banks have trillions on their books as assets (the world central bank has that, and those monies will never escape their grasp!!) The people that really profited by the QE were the ones that sold their real estate at the very top (they are the ones that PROFITED from money created out of thin air!!), and of course the people that declared bankruptcy and still kept most of their assets. So with QE the banks are made whole again, but they really have bad balance sheets to this very day. Knowing that the trillions are already out there, again most went to offset the bank losses; I think were are now experiencing the worst that inflation can give us. The global economy is a competitive one driven by the consumer, if consumer is tapped out, prices will fall, as there will be few buyers. Wages ain’t gonna go up ten hundred fold, it is impossible for America to have a Zimbabwe/1920-Germany event. I think a deflationary collapse is to occur next. All asset values will fall as good paying full time work and credit becomes impossible to obtain, both for the Fed and you and I. For now the dollar will climb, even faster as Euro implodes first and takes the bonds and stock markets along with it, the dollar will be the last haven, until the balloon for the US pops. This scenario sure is becoming clearer each day.
Bert,
Might I remind you that the Fed is printing $85 billion a month and $12 trillion in U.S. liquid dollar assets are held outside the country. Thank you for your comment. I see inflation and deflation at the same time and that is what we are getting. Look at food and energy, then look at housing.
Greg
One of the horsemen of the apocalypse has a set of scales in his hands because unjust weights and measures are an abomination to God. this is announced before calling for a days wages for a loaf of bread.Of the 50 or more attempts by governments to make anything but Gold and silver money each and every attempt has ended with their paper subsitutes being inflated into oblivion. Zimbawbe reached an inflation rate of 400 quadrillion percent before their paper went into oblivion. the removal of gold backing for the u.s. dollar was an act of default and a declaration of bankruptcy. we have been bankrupt over 40 years and it has escaped the attention of most of us. The dollar is now set to be inflated into oblivion just as the othe 50 or so attemps have ended after averaging 40 years of life. 40 years is also a probationary period in the bible. Its not a matter of if but when our default and bankruptcy becomes official. probably no later than 2014 to 2015. three things are certain death taxes and inflation
Arm ah gettin outa here!
I was wondering how many Countries that had reserve currency status ever had hyper-inflation?
If you would have a link that would list this countries that would be great as I can not find one example, so far.
Robert,
This is something the world has never seen before.
Greg
Hi Greg
I will have lend more to Peter’s opinion and believe the Fed will not and can not allow interest rates to move.Liker i’ve stated before the Fed has painted us in a corner.The Fed simply cannot stop stimulus,if at all, there will be larger purchases as other buyers dry up.The theory on inflation is no longer that as it has begun.Prices across the board are up.So it appears as time is running out.How much longer can the middle to lower class hold out before America looks much like Europe?
Great Reporting Greg
Thanks Dave
oh P.S. Irene i’m in fear for Kerry
Is a debt downgrade really coming after they sued the S&P? I don’t think so…
But explain how the bond bubble crash will affect average, middle-class Americans who have 9 to 5 jobs? This is why people aren’t getting it. They want to know how or if it’ll affect their jobs. Layoff’s? mass firings? etc
NM,
The short answer is interest rates would go up right along with inflation.
Greg
Dave: For those who have physical gold and silver, I see where the benefits will increase as the economy dives. Is there ever a scenario
when one should begin to sell their precious metals?
Phillip
Phillip,
This is a trading mentality. If you have PM’s you have real money and the ultimate in insurance.
Greg
The problem with being short in this market is that it can stay pumped up longer than you can stay liquid. The Federal Reserve can print and print and at some point the world will lose faith. But in the mean time, if you are short, you are losing money waiting for the crash that you know is coming, you just don’t know when. IMO the safest way to bet against the Fed, is to own precious metals. And when I say own them, I am not talking about some shares in an ETF like GLD or SLV, I am talking about buying a safe and putting gold and silver bullion coins in that safe. If you can’t hold it in your hand, you don’t own it! The courts have already ruled that financial institutions can use your assets as their collateral and if they lose, you lose your assets even if you aren’t ‘betting’.
It’s not rocket science P<P+I Our Principle (Dollar) is less than principle plus interest @ conception. Only one out come is possible in this equation, DEPT. No Debt No money. Infinite Debt? TIME TO INVEST IN THINGS OF REAL VALUE, Or believe that this can continue indefinitely.
Gold is money, debt-free and as liquid as any digital currency on the planet.
The US has been in default for 42 years.
Quite comical reading the Federal Reserve is “Already Insolvent” according to James Turk. I am unsure as to when they ever were solvent, I do not believe they ever were.
Solvency is no longer an issue, we are lightyears beyond it.
Hey Greg,
As bad as the Banksters and politicians are treating our once great nation – they will in turn treat badly anyone in the world who won’t play the game by their rules. Americans are captive; but the rest of the world is NOT going to put-up with too much baloney. If the world is like a sandlot baseball game – the other nations will, when they are stepped-on and caused to lose issues and finances, will begin to watch their own back and take their gloves and leave the field. It’s sad that China doesn’t have to do much to eventually be “King of the Hill”; only wait around until the US self-implodes. Favor is fickle – all the good America has done in the past will be forgotten, in the face of our recent, spoiled, and irresponsible generation. It’s a shame.
The graph of Fed debt-buying about says it all – technical default. Perilous times.
I notice lately that the MSM and even MSNBC/Bloomberg DO NOT talk about the bond market bubble. -Only Jim Rogers and Bill Gross, etc. do, and they are considered by most to be laughable cranks. = You have to wonder if the “powers that be” are avoiding talk of this bubble on purpose or is just historical ignorance as in 2008 ?? – One way or another, this bond bubble, along with political fiscal gridlock is a juggernaut to ruination. /// Gregory M. gave us a concise explanation that ANYONE could understand. -And yet,willful ideological stonewalling of “the other” will prevail.
Tnx Greg,
Excellent report per usual.
Perhaps Greg and Max Kaiser have the timing down this time but recall
how many other times in the past yr or so that we all assumed the
Fed’s last ‘ace in the hole’ had been played.
I still think they have a few ‘aces’ stashed they can play b4 the entire’house of cards’ collapses but I’m certainly no Bill Gross or Mannarino.
Also not sure I agree the Chinese Yuan is gonna b the coming currency since they have their own bubble problem going on and the Euro Banksters’ Cabal grip has held for at least 250 yrs.
I’m pretty certain this same cabal is presently working in cooperation with the US & Chinese to initiate some type of global digital system when everything does finally collapse and I wouldn’t
be surprised if techies like Ray Kurzweil will be advisers.
Gregory has mention that there has been an uptick in violence in this video interview and in past videos. I would like to know what sort of violence has been on the uptick to make sure that I can best protect myself and my family.
With the terminal decline of the US dollar and the pending budget sequestration what would be a difference between a 20% pay reduction and work reduction now for a furlough federal employee compared to eventual 20% pay reduction with 0% work reduction as a result of inflation?
I’ve read that the sequestration will cut $85 billion dollars over a 6 month period (March through September).
In the meantime the Federal Reserve will be printing $85 billion dollars each of those six months for a total of $510 billion.
The absurdity of all this is dumbfounding.
For people that have just a few dollars, you might want to consider going to recycle type places. You can sometimes buy steel pipe, as well as all sorts of pipe fittings (zinc, copper, etc.). Also, you can buy slightly used building materials, and all this stuff is selling for 10 cents on the dollar.
To give you an idea, I bought a gallon of stain to paint my deck for $8. It had a big box home improvement center price sticker that said $27. I ran out in mid job and had to buy another. The recycle place was out, so when I went in to the home improvement store, the new can cost me $37!
That was 2 or 3 years ago. I probably costs $40+ by now.
Hi Greg!
The bond/equity markets will be the last pillars knocked out as the house of US petro dollars crashes down removing the dollar from the global reserve currency status to a regional reserve currency among six others being the euro, yuan, ruble, Aussie dollar, Iraqi dinar, and Brazilian real as the seven headed beast comes into full power by this fall.
In CHRIST! Rob
So where do we go from here ? We get up soldier…this war is not over.
Freedom is not a choice..it is a absolute. If one is in debt. get out. If you have fake dollars buy silver or land..ect. But under no way do we the free, and brave just throw in the towel and quit.
Greg,
Without sounding condescending and not directing this at anyone in particular…..and maintaining respect for opinions…but….
It never ceases to amaze me how many financial talking heads out there are able to do the MATH and conclude based on logical thinking.
Analysis but where are all the Solutions…?????
Debt = Destruction….Quid Pro Quo….!!!
That’s become the drumbeat for some time now….and in all reality …if this (QE)were to persist…then there would be a probable Armageddon. Put simply it cannot continue ad infinitum.
Maybe a little bit more thinking outside the box might get some sufficient debate to surface in terms of resolving the issue.
Its not a zero sum game here….there isn’t someone who wins in this battle….WE ALL LOSE.
If Benny and the Fed were “smart enough” to save the world from a Depression ….don’t ya think they would be contemplating the end game and how to ensure continuance of a financial/economic system without us all reverting to caveman mentality….?
Sure I understand that more Debt doesn’t solve Debt….but we are dealing with systemic problems that have been created over decades of “free market” operation combined with a lack of regulation and growth from pure unadulterated leverage and credit/debt creation.
Maybe just maybe…..one of these so called experts can come up with a plausible solution. Hmmmmmmmm….waiting …..!!!!!
Austerity or Reduced money printing are not solutions. Keynesian economics created this mess …but IMHO his theories will not fix it. Central Planners have to change tact.
In my career and throughout my earlier studies I have read about the godfathers of economics…. Marx, Keynes , Freidman and Hayek.
Each one of them has a deserved place in the development of the world and moreover the system of economics most western countries have adopted. Each one stands tall as a shining star. But they collectively developed theories that may well have suited economies from a bygone era. How can we say there is relevance to what they observed in their time (in some cases well over a century ago) and say that it is still applicable in todays sophisticated world.
Where are the “New Age” Economists…ones that have a different school of thought…ones that aren’t trapped in the educational barriers that Big Corporates demand….(studying Keynes’s monetary theory etc.).Where are the great Men/Women of our society who have a different mind set…who want to challenge the status quo….??? Are they all locked up in cages like wild beasts never to be released for the sake of retention of control and power in the hands of the Elitists ?
I fear for the world because it has become too complacent. We have become too trusting of our leaders of society to make the correct decisions. We are powerless. We have lost our creativity ..our inventiveness. I refer to them being used for the “Good” of mankind…not to be taken/inferred as relating to the geniuses of the Banking world where creativity has become destructive.
When all is said and done we are all subjected to the whims of our planners. IN the face of the harsh reality of empirical wealth destruction, they may take heed and adopt a sound monetary system which is supported by Gold. This is not wishful thinking…I believe Benny and the FED know this is where the world will need to change and the reasons are sitting bare beneath their feet..
“Time” has been of the essence for them….for they know that to create /change a debt based system that has become so endemic, involves many calculated considerations and unique positioning. They are not quite ready for that day…..but be sure of one thing….that day is getting closer.
“He who has the gold”…..
Good day to you Sir.
What a shock when I saw you Bonds chart. I dont know if we can talk about armagedeon but USA are in very dangerous zone and all countries of the world will follow. It’s very scary.
Congratulations!
Claude,
I thought that was priceless too. A picture really is worth a thousand words. Thank you for the comment.
Greg