Financial, Economic and Social Mood Update (November 1, 2019)
Last month’s blog strayed from the usual monthly topics by updating my readership with respect to new information on our own Borromeo family genealogy. This month’s blog will discuss more information concerning the unmistakable emerging global demographic collapse (incredibly, it is actually gaining momentum) and the economic & financial ramifications emanating from this phenomenon.
I believe that the Philippines is very well positioned for the near future, but then again, ALL population groups on earth regardless of nationality, race, region, affluence, faith, location, language (or whatever other criteria) are either in declining growth or in an outright decline. We can extend this worrisome trend to much of the natural world as well – wild animals including mammals, birds (an alarming 30 percent decline since 1970), fish, pollinating insects and so forth. The disturbing trend in the natural world is due to loss of habitat, deforestation, over-hunting, so called “sport” hunting which should cease outright, genetic modification, abuse of toxic chemicals and the massive pollution of the oceans, lakes and rivers especially with plastics.
After the disaster of the Ferdinand Marcos years (1965 to 1986), the Philippines went from being the 2nd richest per capita nation in Asia after Japan to being among the poorest above countries such as those in Indo-China and Papua New Guinea. The Philippines has made tremendous progress since 1986, seeing its per capita GDP rise from about USD $600 to USD $10,000 in terms of Purchasing Power Parity (PPP). In spite of declining fertility rates, birth rates and smaller families, the Philippines continues to enjoy one of the most rapid population growth rates on earth – important to maintaining robust economic growth and in order to fund pension programs and other social programs. The Philippines today has the 26th largest economy in the world out of as many as 291 independent countries and dependent territories. By the year 2025 (a mere 6 years from now) the Philippines is projected to increase its rank to number 21 in the world. Most of these changes will take place not merely due to relatively robust growth in the Philippines, but due to ongoing demographic collapse in much of the rest of the world. Add to this fact a pending global currency reset (GCR), global economic reset (GER) and/or global currency Revaluation (RV), and the worldwide rank of the Philippine economy is projected to rise to number 13.
The number one reason that the GCR / GER / RV is necessary is because the USA no longer has the financial clout to maintain its global economic dominance. It is more heavily indebted than any country in human history. 94 percent of global debt servicing payments now come from the USA, for the simple reason that the USA is so heavily indebted (both the public sector and private sector of the US economy) and because its creditworthiness is so far below the global average. In the absence of credit, the USA would become the poorest country in the world overnight – even poorer than the now poorest Democratic Republic of the Congo in central Africa…………the country with the lowest per capita GDP in the world today. The average person in the USA now spends an astonishing USD $7,400 per year more than they have in income, and 44 percent of Americans spend more than they make. In other words, there is no net savings in the USA – only more debt which gets the country and its people further into the hole.
Neither major political party in the USA addresses these ills or even has the will to do so – the same holds true with their political supporters in the mass of the American population. The Trump Administration has launched a highly destructive global trade war in a vain effort to postpone the bankruptcy of the American corporate state. Its Democratic rivals fall over each other as to whom can offer the most “free stuff” (NOTHING is free) – government programs which would cost a mind boggling USD $210 TRILLION, or almost double the GDP of the entire planet earth. These resources simply DO NOT EXIST.
The USA is rapidly running out of friends in the world. The vain war on global trade targets the likes of China, India, Europe, Canada and Mexico. America’s few remaining friends include the likes of the UK (with the right wing BREXIT attempt to return England to her lost glory – something which will never happen), Israel (which will hopefully change her right wing course and cease being an Apartheid State), Poland (yet another country with a right wing government displaying xenophobic tendencies) and Australia (with a newly elected right wing government at odds with its Pacific neighbors over environmental policy and the continued use of fossil fuels). Australia, Indonesia and the USA enviously eye neighboring Papua New Guinea’s world record gold reserves in another desperate attempt to avoid the bankruptcy of the American corporate state. The cost here is yet more environmental destruction which takes the entire world (willing or not) to the brink.
The US Federal Reserve is now pumping financial markets with between USD $70 to USD $105 BILLION per day. Why create such massive amounts credit out of thin air? Because liquidity among banks has literally dried up. Interest rates are at historical lows – 5,000 year historical lows according to the Bank of America. Creditworthy demand has dried up, and with rates so low it no longer pays to lend money. This are highly troublesome signs of a sick and dying economy and these trends bring the survival of the entire financial industry into question.
The Central Banks of the USA, the UK and the EU have already prepared currency notes with much higher denominations than those currently in public circulation, for the simple reason that the currencies of these countries will soon lose much of their purchasing power vis-à-vis the rest of the world. In a very real sense, we can already see that is process is well underway. Merely think of your visits to the grocery store, the restaurant, the cost for home improvement & repair, and the list goes on. The purchasing power of our money is rapidly disappearing………………but it is about to get much worse. The first step of the currency devaluation in the west will result in a “haircut” of about 40 percent – in other words, your Dollar today will be worth just 60 cents tomorrow. And keep in mind that further “haircuts” will follow the first “haircut.” Not a pretty picture.
