Four days ago, I highlighted that the 'U.S. Financial System Bailout Mushrooms to $7.4 Trillion'. That number is no longer correct.
Paul Joseph Watson from Prison Planet.com reports that the cost of bailout hits $8.5 trillion:
Cost Of Bailout Hits $8.5 Trillion
Total sum represents 60 per cent of GDP
Paul Joseph Watson
Wednesday, November 26, 2008
The total cost of funds committed to the bailout in its various guises has now hit $8.5 trillion dollars, up from $7.7 trillion in just two days after the federal government committed an additional $800 billion to two new loan programs on Tuesday.
The total amount of funds now committed equals a figure that represents 60 per cent of the U.S. gross domestic product.
Millions of Americans with savings accounts and pensions will ultimately pay the price because, as the San Francisco Chronicle admits today, “The Fed lends money from its own balance sheet or by essentially creating new money.”
You' ll also find this little snippet in the article, “Most of the money, about $5.5 trillion, comes from the Federal Reserve, which as an independent entity does not need congressional approval to lend money to banks or, in “unusual and exigent circumstances,” to other financial institutions.
Just another reminder that the private, run for profit, Federal Reserve has the printing presses cranked on overdrive in order to bailout Wall Street and the big banks, while the homeowner and the middle class see their savings devalued out of existence.
“If you print money all the time, the money becomes worth less,” warns Diane Lim Rogers, chief economist with the Concord Coalition, but its an empty threat to delirious traders and investors drunk on a record stock market rally after the government pumped more fake liquidity into the bloated bubble.
Veteran investor Jim Rogers echoed the sentiment, predicting the dollar is “going to lose its status as the world' s reserve currency,” adding, “It will be devalued and it will go down a lot. These guys in Washington, they want to debase the currency.”
“They think that if you drive down the value of your money, it makes you more competitive, now that has never worked in history in the long term,” said Rogers.
How long will it be before Americans realize the looming specter of hyperinflation spells disaster for their life savings? How long will it be before we see rioting in the streets on a par with the scenes witnessed in Iceland over the weekend, where the Icelandic krona has lost half its value in a matter of weeks?
Meanwhile, over in the UK, the government assured the vast majority of the population that they will “tax the rich” in order to pay for the bailout on the other side of the Atlantic, with whopping 61 per cent tax bands being levied on those earning over £100,000 a year.
Since when was £100,000 a year “rich”? After tax, even if someone was able to save half of their remaining income, it would take them around 30 years to save a million pounds, adjusting for inflation. That is not rich.
The reality of course is that it is the middle class who will once again foot the bill for everything, leaving the elite to prolong their con game of fiat money and imaginary credit , once again suckering the poor in for a lifetime of indentured financial servitude.
My reaction: The deflation is dead. Long live hyperinflation! Seriously though, the dollar's purchasing power is about to head to zero at a ferocious rate. By the time the Average American figures out what is going, backwardation will have destroyed the futures market, and the dollar will be leading all fiat (paper) currencies into the abyss. Buy physical gold where/if you can find it.