Wednesday, August 10, 2011


By SRSrocco
I believe we are much closer to a collapse of the U.S. economy than most are led to believe. To understand just how fragile the situation has become, presented below are the 5 stages of collapse from a slide by Dmitry Orlov:

The U.S. financial system died in 2008 when Bear Stearns, Lehman Brothers and AIG went bankrupt. As Jim Willie stated in one of his articles, “Pumping blood into dead corpses will not revive the system.” That is not an exact quote…but you get the point. The big banks are basically dead. This is the full description of a STAGE 1: per Orlov:

Stage 1: Financial collapse. Faith in "business as usual" is lost. The future is no longer assumed resemble the past in any way that allows risk to be assessed and financial assets to be guaranteed. Financial institutions become insolvent; savings are wiped out, and access to capital is lost.

If we read the whole description we find that just about everything listed above has occurred except the part where savings are wiped out. The FDIC moving the insured $100,000 amount up to unlimited postponed the inevitable. Risk cannot be assessed correctly anymore as the FASB has allowed the banks to MARK TO MODEL their assets. Thus, if the banks did MARK TO MARKET their assets, they would indeed be insolvent. And lastly, banks are not lending which proves the point that access to capital is for the most part…lost.

This brings us to the next stage which it looks like we are getting ready to enter in very soon. Stage 2 per Orlov:

Stage 2: Commercial collapse. Faith that "the market shall provide" is lost. Money is devalued and/or becomes scarce, commodities are hoarded, import and retail chains break down, and widespread shortages of survival necessities become the norm.

With the recent S&P downgrade of U.S. debt, the move into stage 2 has been set. Watching the markets in the past few days, there is a sense that “ALL IS NOT RIGHT”. If we look around the world there is this almost frantic effort to pump up banks, stock & bond markets. This is causing extreme volatility as markets act schizophrenically down one day, then up the next.

How close are we into entering stage 2? That’s a good question, but if you just take a good whiff of the air around you…it seems very close. Good barometers of the event are the actions of gold and silver. The charts below tell the story:

Both gold and silver are heading into an exponential rise. Some traders may say this is for sure a parabolic move…and a BLOWOFF is almost guaranteed. I gather these traders have not read the 5 stages of collapse. Regardless, the two monetary metals are revealing to the world that ALL IS NOT WELL.

It is said that parabolic moves do not end well. I totally agree. In this case, it is the Fiat Currency-Compound Interest-Fractional Reserve System that will get the brunt of the pain and not gold and silver. This is why it is a gamble to have ones assets in paper instruments at this time. Gold and silver stocks are the next best bet over owning physical metal.

Very few if any analysts saw the huge commodity take down in 2008. Today, it seems as if they are mostly confident that it will occur again. I believe this time will be different. Entering into a full blown stage 2 of the commercial collapse will make 2008 look like a picnic. Back then, the big worry was watching paper wealth disappear. At some point in time….it will be witnessing goods and foods disappear. The former is not a necessity…the latter most definitely is. You can read more about the 5 stages of collapse Click here ...

It may be time to buy some real insurance…and not wait until the firestorm has arrived.


  1. thanks SGS. Reading this it occurred to me that acquiring G/S is no longer about being an investments as much as now being a moral imperative. If/when the second stage of the sequence is complete, I anticipate the following stages to domino very quickly, it might not be unthinkable for a 3-9 month time frame? It is a moral imperative to have G/S to "reignite" economies on the most microscopic level; local. People will barter and trade services but metals, including copper, will ALWAYS hold intrinsic and biblical value. I foresee proceeding a collapse of the system, the experience being so horrific for most folks, who have become so dependent on modern day conveniences, folks will quickly "get religion". This is all speculation and I pray none of this transpires however, I just can not see any logical outcome to all this mess.... dunno.

  2. the financial collapse actually was doomed during xmas season of 1913 in DC ... tho the nefarious Jekyll Island cartel summit, with the "hunters" using aliases in NOVEMBER OF 1910, hatched the FED which has ruined the world thru Jew bankers.

  3. Well I am glad to see my mining stocks start back up. Wildcat up 20% today, Great Panther 10.5%, Tinka up 11%. My paper portfolio is up 9% today.

  4. SGS- Blythe has a facebook page as well as a personal blog.
    We left the following post on her facebook page this afternoon:
    Blythe Masters! Our Hero! Thanks for suppressing silver with your 120 Million Ounce Naked Short silver position, thereby allowing us to acquire silver at REALLY REALLY REALLY RIDICULOUSLY LOW PRICES, and run a website exposing your manipulation!
    Thanks for all you do!

    5 minutes later our post was removed and we were banned from the facebook page.
    Thought you might enjoy informing your many readers as well!


  5. Ranting Andy:

  6. @SRS...

    Great insight; wonderful article!

  7. If we lose everything we might be provided with U.S. GOVERNMENT HOMES:
    Government Owned Housing Begins

  8. Goldman Sachs guy be interviewed on CNBC right now saying "The government has not been particularly generous to the large banks, and the banks are in great shape, and cannot understand why the equities are falling"

    A true ponzi master! These people are truly insane!

  9. Blythe's personal blog is now wiped clean of the 75 comments advising what a whore she is...amazingly this comment is still posted.

    Ex-Dissident said...

    Blythe, ignore these jealous morons. You are the essence of class and wit, all mixed together in one spectacular woman. You are both admired and loved.

    Time to add some more comments guys!

  10. There is this guy who has been selling 1 oz gold eagles on ebay for months now. He sells them as a pre-sale and you wait a month for delivery. He had been selling them way lower than everyone, typically $40-50 above spot. After ebay bucks you were basically getting the gold at spot. I would buy some when I had the money. I had bought 3 coins from him. I bought 2 in May at $1540 a crack and 1 in July at $1640. I don't know how the dude is making money. He sold hundreds and hundreds of these things and has to be getting raked. His premium is now $160-170 over spot. LOL, he must have been taking it with no lube the last week. He uses 2 handles, goldeagles and fp4976

  11. Silver has not been moving parabolic yet. Gold has yes, but silver not yet.

  12. @OC15 - Here is a recent post from fp4976:

    $1950/oz w/ free shipping
    eBay seller fee is 9% (capped at $100)

    Pay Pal fee is 4% of final value deposit(I think.

    Hes making shit above spot... maybe $40 per coin... profit is profit in large quantities though.

  13. @OC15 - Good! More time to stack before it pops above $50/oz.

  14. Silver bugs in Italy too:

  15. SGS... thankyou for that. One of your best posts ever.

  16. SGS, thanks for premiering the article.

    SRS, thanks for the insight.

    Can we please call SRS, Rocco, from now on?

    Or EROI Genius? Or consigliere?

  17. SRSrocco, great job man! I agree, that is why I have guns, ammo, food, silver, etc, etc, etc. I won't go through the list again because only ledbetter wanted to be my neighbor, but the shit is a comin', truly, sooner than we think. Millions of people are going to die. People think America is isolated from the violence that is sweeping the globe, but just wait until those gubmint checks stop coming. Pandamonium in the ring. Get out of U.S. Cities while you still can. Unless of course, you are into gang warfare.

  18. TOM H,

    Can I live by your creek? I'll stay quiet in my tent, and just come over for meals once in a while.

  19. I visited my Favorite coin shop on the way home from work today.. And they were Wiped out of Gold/Silver Bullion.. I've been visiting there frequently, so were pretty good friends.. He had held me back some Silver Eagles..He said most of the people coming in to buy are older people between 60-70yrs old.. He said they remember, Silver is Real Money !

  20. $1800 Gold.

    I almost cried. And not from happiness...

  21. Like I said last night... Silver is playing catch up, we bout to cross $40 again.

  22. @colin ha yea its definitley all the jews fault...they are the only kind of people capable of greed.

  23. @nig no, but they seem to have made a sport out of making other people suffer to feed their greed for power, wealth, and control. More so than any other group. Do some research. And thanks for playing.

  24. Did any of y'all listen to last week's Jim Rickart's interview on KWN where he states that all the American gold is being held @ military bases, Fort Knox & West Point? The NY Fed is holding foreign, mainly German gold and the total tonnage makes the US the Saudi Arabia of gold.

    Not to get all "Seven Days in May" on you, but am I the only one who can see the military seizing control of this country in the wake of a global financial crisis? After all if all the gold that is claimed to be deposited in Ft. Knox & West Point is real (and when you think about it, why would the Joint Chiefs allow the Wall Street kleptocrats to steal this gold) combined with the world's most advance military equipment, is the age of the Caesars in North America that far fetched?

  25. They believe in GOD.

    Hat tip to Ledbedder for unveiling my Chunky eyes.

  26. @TOM H - Save a spot for me too, although I'll be rolling up in a war wagon filled to the brim with provisions, such as my .50 Cal rifle.

    @Jon - Once the dollar goes, so does the US military. They won't able to maintain their shit, but you can be damn sure they will try to take what's yours after they declare martial law and try to confiscate what they need...see war powers act. Try is the definite word...the result will be failure of EPIC proportions.

  27. E-Trade Baby Loses Everything.

    for those who have not seen it enjoy