Update 1: Corn is getting popped on the CBOT. Fresh high not seen since 2008. And you thought the food riots in 2008 were bad?
Let's be blunt: all things being constant, the world is descending into chaos. Besides the degenerating and continually expanding threats from Fukushima spewing radioactive particles into the environment (more on that later), the world has been on the financial brink since 2008 and nearly three years later, it's coming unglued. As a recent CNN poll shows, 48% of Americans believe a Great Depression is coming within a year. We're not sure who constitute the other 52%, but the top 5% of the population in terms of wealth, have never been happier. The world's Billionaires list not only increased by an incredible 20%, but those in the Billionaire ranks saw their net worth increase by an astounding $1 Trillion - not to mention, the tens of thousands of banksters who received record bonuses last year and are on track for another booty. From my personal observations, I have never in my life seen more banks than at any other time; Starbucks ain't got nuthin' on banks.
Max Keiser ran an excellent story two days ago about France's biggest bank cutting ATM card cash access in half (American banks already did this way back in early March) for the week and people are flipping out. Which raises yet another question concerning the necessity of banks: what is the purpose of having money in your bank account if you can't access any amount that you need? Worse still, that money may not be as safe as you think. Citibank (a Too Big To Fail, Too Big To Save tax payer funded bank) is admitting to a serious hacking of 200,000 accounts. Here's the clincher - that incident occurred one month ago, yet they are just admitting it now. Time for another "personal observation," so follow this line of thought: 1) Many bank checking accounts are now costing you upwards of $20 per month to keep your money stashed in an account 2) that you may or may not have full access to. 3) Typical checking accounts pay 0.00114% interest, which is not even enough to cover the cost of inflation for a single hour, given a very conservative MIT Billion Price Project estimated 10% annual inflation rate. With some savvy mathematicians placing the real inflation rate at 17%+, you can see how keeping money in the bank is a losing proposition. Remember, gold never gets old.
Speaking of old, Nokia is
We're sure that some overpaid talking head on CNBS will come out to spin that Japan's nuclear power shortages, which are spreading, are bullish for the economy. An interesting noteworthy comment from this article: "only 17 of Japan's 54 reactors now are operating—merely a third of the country's total nuclear-generating capacity." And Toyota/Honda/Nissan/Sony/Hitachi et al are supposed to operate their factories on what? At the same time, the IMF is urging Japan to raise its sales tax from 5% to 15% in order to pay for this disaster. Uh, what? As we posted back in early March about Greece's financial death spiral, there's no better way to stimulate your economy than taxing the hell out of your people while implementing austerity measures during the worst global financial crisis the world has even seen. And be sure to include skyrocketing energy prices for good measure. That works well.