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Here's an email I received from my Dad this morning on the current global situation. His insight is pretty helpful to understand our current situation. Thought I'd pass it along, enjoy...

This morning I woke up and during my sleep my mind had connected some dots. We have amazing world events - pretty similar in many ways to the 1930's.

It started with Republican Paulson's decision to let Lehmen fail - so here is an interesting sequence...

1) Letting Lehman Bros. fail caused the world gross national product output to almost stop for 18 months
2) That caused our American mortgage industry to collapse and within months the USA had to take extreme and drastic Federal steps to prevent the other 5 investment (mortgage reseller) banks from collapsing such as phase one, two and then TARP.
3) Smaller banks failed around the USA in huge numbers
4) Global banks began to fail since they were stuck with worthless mortgage paper sold to them by the US investment banks
5) USA unemployment skyrocketed to 10.2% in 2010 and has continued to hover there plus or minus 1 %
6) The Euro began to drop in value
7) European Countries that were overspending got caught in the global downturn and had to buy more money
8) Real USA unemployment (underemployment or those whom unemployment payment expired) rose to 20 plus %
9) USA housing values dropped between 29% to 60% - depending on which area you were looking at
10) The stock markets dropped 30 to 50% and families savings were consumed by this drop - so that their two biggest net worth calculations dropped 60% for most families.
11) Housing foreclosures rose so fast that banks have been afraid to foreclose on homeowners. I know one family that has not made a mortgage payment for more than 2 years and the banks have not foreclosed. They know there is too many foreclosed homes in inventory and figure it is better to have the homeowner live in the home vs. leaving it empty.
12) World Tourism visiting other countries radically declined
13) The Tea Party won enough legislative seats to be a power
14) The Tea Party was angry about taxes and federal debt when they hit Washington - although they were in experienced in economics, politics or Global impacts
15) Mideastern countries counting on oil sales found sales were off due to high prices and their income radically declined
16) Greece, Spain, Portugal, and Italy came to the edge of bankruptcy
17) American consumers radically cut back their spending for the second time in two years
18) The Mideast raised oil prices to offset their banking and tourism losses
19) Mideastern sales of oil declined because major American and European consumers drove less, and the newer cars got better mpg
20) The Mideastern countries saw huge unemployment in the 20 to 40 year olds because of their local sagging economies.
21) The Mideast riots began as their oil and tourist dollars declined - Tunisia and Egypt have 1/3 of the GDP based on tourism (I don't know about the rest of the Mideast. But Dubai found their huge national investment in tourism was already faltering.
22) We scared the bejabbers out of the world markets by massive delays in raising the debt - which turned out this was like threatening to let Morgan Stanley, Goldman Sachs, etc go bankrupt.
23) Meanwhile early "Back-to-school" sales are showing a very weak consumer - and is usually those sales are the forecaster of the Christmas season
24) Today - the world markets react to a general fear factor as for the last 8 weeks they contemplated the global financial disaster that could result by the USA defaulting.- the impact is similar to America actually having defaulted.

Can you begin to imagine the world reaction if we actually defaulted? Oh my gosh ....

Now here are some more dots to ruminate over....for kicks I googled wiki about the tax revolt 1930-1933. Here is the link to save you time - http://en.wikipedia.org/wiki/Tax_revolt - copy and paste it. Then read the 1930 Tax revolt background and compare it to 2009 and 2010 and then to our world today. The world was in a depression started by the American bank failures. The Euro/Baltic global reaction was to blame their own banks and consequently the Euro/Baltic/Russian Jewish bankers and their banking establishment. So the The European and Baltic governments needed scapegoats and selected the hapless Jews.

European Inflation went rampant as companies tried to raise prices to cover their losses. USA went into massive unemployment. The Euro/Baltic people base become extremely angry at their governments and began to quietly and then violently protest their governments. In my high school history books were pictures of German women going to the grocery store carrying large shopping bags filled with German Marks to buy a loaf of bread. Meanwhile the Japanese economy was flourishing.  They went to war against Russia to build a railway in order to export goods to the Western world. And shortly after their Japanese economy ramped up, Europe went to war - but we didn't. The affluent Japanese wanted to drive cars, and fly planes - but because of their SinoRussian war the Japanese businessmen needed to manufacture large amount of goods. To wage war and to manufacture goods, they had to import all of the basic materials, steel, rubber, aluminum, copper, tin, nickle, oil etc. They turned away from the Russian war and instead went to war with China, Korea, and the Northern edge of Indonesia, where they won the lands containing these commodities. FDR sent an ultimatum to Japan to back away from all of Indonesia and the Philippines, especially from the Indonesian Oil fields, and within 3 months we had World War, Pearl Harbor and Europe.

Right now we have our hopes pinned on Germany's ability to hold the poorly managed European countries together. The Mideast remains a crap shoot. As those governments topple or change, will the replacements be good global friendly governments? Our traditional ally India is flourishing and has enough raw material to support their economy. But they have bad neighbor Pakistan and Afghanistan at their back door - both countries a doing poorly. So does flourishing China and their trend seems to better global citizens not more hostile. Africa remains an unknown. But these are all threads that we might be wise to support.
Sobering dots when you connect them. I think that it might be a good idea for us all to pray for God to strongly  intervene in our world once again.
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