The Bankrupting of America
by Porter Stansberry

Thoughts From The Frontline
John Mauldin's Weekly E-Letter

(See Cutting Edge Analysis following this article)

June 6, 2003

"There's nothing unprecedented about interest rates beginning with the numbers 1,2 or 3. They were the rule rather than the exception in the days of the gold standard. But, as far as I know, no rates such as those quoted today ever appeared in a monetary system unballasted by gold or silver."
-- James Grant, Forbes 6/9/2003

America is bankrupt.

This from Jagadeesh Gokhale and Kent Smetters.

No, these men are not a Saudi terrorist or Southern right wing extremist respectively. Instead the former is the Senior Economic Advisor to the Federal Reserve Bank of Cleveland, and the latter is a full professor at the Wharton School of the University of Pennsylvania.

Credentials notwithstanding, the men's conclusion would seem preposterous. America has never seemed more prosperous. Even this recession has been minor.

On the other hand, their source seems reliable: Gokhale and Smetters got their data from the U.S. Department of Treasury. And they performed their present value calculations on the order of then Secretary of the Treasury Paul O'Neill. Smetters was, until recently, on staff there, as the Deputy Assistant Secretary for Economic Policy. The Treasury needed new numbers because the Office of Management and Budget's numbers have almost no connection to reality. (For example, OMB projects a constant 75-year average lifespan in its Social Security and Medicare cost estimates even though the average lifespan in America is already 78...and increasing at the rate of three months every year.)

When you look honestly at our government's future obligations, the numbers in the red quickly become so large they require entirely new measures to describe them. Gokhale and Smetters invent the term "financial imbalance," to measure Uncle Sam's impending bankruptcy. Financial imbalance means: "current federal debt held by the public plus the present value of all future federal non-interest spending minus the present value of all future federal receipts."

Or, in other words, Gokhale and Smetters use FI (financial imbalance) to estimate how broke Uncle Sam is when measured in constant dollars, today. FI is how much Uncle Sam owes now and will garner in the future versus how much he is on the hook for now and later.


Cutting Edge Analysis: There is absolutely no doubt that the Illuminati plans to bankrupt America and crash our Stock Market and our economy. However, this part of the global plan to produce Antichrist will not occur separate from the Political plan to produce World War III, out of which will stride Antichrist. Our economic ruin will also not occur separate from the global Religious plan to produce the One-World Religion of the False Prophet and Antichrist. In other words, all three parts of the plan will occur simultaneously and are designed to wreck each segment of the current world order so that the New World Order can arise out of the ashes.

Former Satanist, Doc Marquis, stated that the Illuminati would use powerful Witchcraft, if necessary, to keep the economy afloat and America prosperous until all three elements were ready to be destroyed at once. Therefore, read this article with the necessary grain of salt.

David Bay