Fwd: Taipan Insider: U.S. Soldier Decodes Debt Clock

[Bipin Gautam]

---------- Forwarded message ----------
*"Assuming no inflation, a constant GDP, a constant % interest rate, and a
budget increase of only how much more interest we have to pay on the debt
that year, how many years will it take before we are paying more interest on
our national debt than we will have to spend that year? (Complete economic
collapse) *"

COMMENT: In case you have not noticed, 2019 is only ten years away. Even if
we have a gold rush boom in the economy, it will not push off that magic
crossing of the debt and revenue chart lines for too many years so expect an
economic collapse sometime in the next twenty years...or less. By 2017
would be a good time to have your residence and all investments somewhere
(Brazil?) else because either we keep borrowing (with Grafty Old Perverts
blocking any tax increases to pay for things) and spiraling downward or tax
rates for everyone will have to SKYROCKET in order to cover national debt
interest payments. Not gooood!



---------- Forwarded message ----------
From: Taipan Insider <tai...@taipanpublishinggroup.com>

*Tuesday, October 27, 2009*
****
****
* *
****
* *
**** *The Struggling Airline Industry Gave Me the Flu
The Most Powerful Force in the Universe Key to Wealth-Building Potential
Small Businesses Being Ignored by Washington and Wall Street
U.S. Soldier Decodes Debt Clock*

Dear *Taipan* *Insider*,

Today I’m filling in for Sandy, as she’s flying to Chicago on business. I’ve
done a fair amount of flying these past few weeks myself…

I recently took a trip to Italy, which *VIP* subscribers were able to read
about in last Friday’s Prosperity Report. Upon my return, I flew in to
Baltimore to give a presentation to the Community College of Baltimore
County – Catonsville Campus and record my script for the South Africa video
report that we’re putting the finishing touches on right now.

Once I got back to Milwaukee last Friday, I was starting to feel the effects
of so much travel. I’d been on five separate planes in six days and I think
I’ve caught the flu along the way.

And if my symptoms are in any way like the struggling airline industry, it’s
in for some problems…

***British Airways to cut 1,700 jobs, says the BBC.* Earlier this month, the
BBC reported that *British Airways (BAY:NYSE)* was planning on cutting 1,700
jobs, and the Unite union says this might not be the last cut British
Airways will introduce.

“The airline said the job cuts would involve 1,000 cabin crew taking
voluntary redundancy and a further 3,000 choosing to go part-time, and would
take effect from the end of November,” reported the BBC.

British Airways has been searching for different ways to slash costs ever
since the end of its fiscal year in March when the company experienced its
biggest loss on record since the company became private in 1987.

And British Airways isn’t the only company that’s in trouble.

***“State plan” for Japan Airlines.* *Japan Airlines (JALSY.PK) *is just
about to be taken over by the state. The Japanese government and the
Enterprise Turnaround Initiative Corporation have decided to put the
struggling airline under state control.

Earlier this month Japan Airlines announced that it was cutting 6,800 jobs
in order to cut costs.

The company lost $1.08 billion between April and June…

The Enterprise Turnaround Initiative Corporation has enough money to buy the
company’s debt, and the intervention has sparked some upward movement in
Japan Airlines’ share price, but the turnaround specialists have yet to come
in and make a change.

The takeover could happen by the end of this week.

With the airline industry and me struggling through flu season, let’s take a
look at what’s happening in the media.
------------------------------

*What the Media Is Talking About: In the News*

***Los Angeles Times Reports Deloitte’s List of Fastest-Growing Companies
Released:* “Deloitte's Technology Fast 500 rankings were released today,
showing the fastest-growing technology, media telecommunications, life
sciences and clean technology companies in the United States. The top 10
companies on the list posted an average revenue growth rate of 53,798%.”
Most of the companies on the list “primarily fell in the
biotechnology/pharmaceutical and communications/networking categories.”

***Michael Robinson of BreakAway Investor Offers Readers Companies With Huge
Growth Potential. *Relying on his many years as an investigative journalist,
Michael has been uncovering companies with huge growth potential for
his *BreakAway
Investor* readers. But he also uses an investment philosophy that has been
called the most powerful force in the universe. Michael adds, “Every time I
look at a growth company’s balance sheet I use the rule. It tells me that if
it is growing internally at 10% a year, it is doubling in size roughly every
seven years.” To learn more, read* “The Most Powerful Force in the
Universe.” *

***American Banking News Says TARP Money May Not Be Good for Small
Businesses. *Reports have come out that the Obama administration is looking
to encourage small-business lending by smaller banks through using some of
the TARP money available for investment. However, critics argue that there
are so many caveats that there is little hope that true Main Street small
businesses will be the beneficiaries of the money. The details of the
proposal are to create a new program within TARP itself, which would have
access to $40 billion of the remaining funds in order to aid new lending to
small businesses.

***Justice Litle of Macro Trader Says Small Businesses Suffer the
Most.*Justice says, “We are at a point in the market rally where
liquidity and
sentiment have long overwhelmed fundamental values. The drunken party is
coming to a close and the harsh reality of daylight is starting to creep in.
This is the type of dynamic that is present when major dislocations and
market crashes occur.” The problem, according to Justice, is that
“Washington and Wall Street tend to focus on big business most of the time.
Right now they are ignoring the destruction taking place in small
businesses, even though small business is still the main driver for the U.S.
economy.” To learn more, read *“An Unsustainable Situation.”*

***Clock Ticking on Debt Ceiling, Reports CNNMoney:* “Roughly $211 billion
separates what the country owes and its self-imposed credit limit. And by
Friday, after another week of massive debt sales by the Treasury Department,
that gap will likely have narrowed considerably. It is now expected that the
$12.104 trillion debt ceiling could be breached by the end of November. It
is also expected that lawmakers will raise the ceiling, as they have done
more than 90 times since 1940 – eight of them since 2002.”

***I’m Surprised and Humbled.* I’ve just stumbled on an amazing story… One
that I just had to share in this space with you. The U.S.’s national debt is
growing out of control. In fact, the interest we will pay on our debt could
exceed our entire budget by 2019. Where did I get this information? From
Facebook… Let me be more precise… From a U.S. Marine posting to a group
called “USA in the Crapper?” His name is Jacob Jolly, and I have his full
post here in my article, *“U.S. Soldier Decodes Debt Clock.”*
------------------------------

*Opportunities Hidden Behind the Headlines:
Inside Taipan Publishing Group*

***The Most Powerful Force in the Universe. Michael Robinson of BreakAway
Investor explains powerful investment concept to create wealth.* Just
recently, Michael introduced a new concept to readers – a new era of
American Wealth Underground. Michael has been using his investigative
journalist skills to uncover the companies that hold true wealth potential…
ones that are ignored by Main Street and Wall Street.

But now he’s found an address for American Wealth Underground: Area 72.
Michael says:

Please don’t confuse that with Area 51, the secretive military base in
Nevada about 80 miles northwest of Las Vegas. Hollywood movie studios love
to portray Area 51 as a place where the U.S. government performs experiments
on extra terrestrials that it keeps hidden from the public.

To be sure, Area 72 is not a real place in the technical sense of the term.
It’s more of a spiritual center that binds together fiscal conservatives and
those who still believe in the American Dream of creating wealth.

It’s more of a virtual world. “But,” Michael writes, “it is in fact based on
a very powerful investment principle that readers can harness for profits…
Simply stated, the area is based on a mathematical rule so powerful even
Albert Einstein was amazed.”

The rule works great for investors. Michael says, “The Rule of 72 tells how
often our money will double, based on our compound growth rate. I’ve been
using this rule to judge growth companies for more than 20 years. So, I know
firsthand that it works. Always.”

The Rule of 72

is a great way to figure out how quickly you can get to your financial
goals. It works like this: Take your compound interest rate and divide that
into 72. The answer is the number of years it will take to double your
money. For instance, if you get 1% per year on money market funds, you’ll
have to wait 72 years for the money to double. A 12% return gets you there
in six years.

Every time I look at a growth company’s balance sheet I use the rule. It
tells me that if it is growing internally at 10% a year, it is doubling in
size roughly every seven years.

Here’s a convenient way to use the rule to calculate the impact of your
gains as you move toward your financial goals. Let’s say you consistently
make 15% a year on your investments. They are doubling in pre-tax value
about every five years. That means your money will quadruple in 10 years
because it will double twice in just under a decade. You will have created
$300,000 in new wealth on a $100,000 investment, which became $200,000 in
five years and then doubled to $400,000 in 10.

The Rule of 72 is the most powerful force in our world, especially for
growing your wealth. That’s why Michael specializes in finding companies
with huge growth potential. The current portfolio of companies in *BreakAway
Investor* has huge growth potential… and should help readers secure a
comfortable retirement.

***An Unsustainable Situation. Macro Trader editor Justice Litle explains
why the market could suddenly drop. Justice writes: *

Financials and consumer names were hit hard this week, while oil and base
metals have broken out. The dollar and China look like key factors. We’re
heading towards resolution of an unsustainable situation.

The decline in the financials was partly blamed on an influential analyst
issuing a downgrade in *Wells Fargo (WFC:NYSE) *nine hours after praising
it.

Names like *PF Chang’s China Bistro (PFCB:NASDAQ)* also show the extreme
degree to which unrealistic expectations have been built into this market.
When PF Chang’s failed to meet third quarter expectations, the stock got
walloped. Other retail-oriented names were hit this week on the news that
Wal-Mart is still on a price-cutting drive. Stocks like *Home Depot
(HD:NYSE) *and *Lowe’s (LOW:NYSE)* also saw high volume declines on
Wednesday.

Justice says, “We are at a point in the rally where liquidity and sentiment
have long overwhelmed fundamental values. The drunken party is coming to a
close and the harsh reality of daylight is starting to creep in. This is the
type of dynamic that is present when major dislocations and market crashes
occur.”

The problem, Justice writes, is that “Washington and Wall Street tend to
focus on big business most of the time. Right now they are ignoring the
destruction taking place in small businesses, even though small business is
still the main driver for the U.S. economy.

“Small businesses and consumers are susceptible to ‘sticker shock’ as gas
prices rocket higher. When prices at the pump go up, small businesses see
their expenses go up (by way of shipping and transportation costs) and
consumers have less discretionary income to spend.”

Justice adds, “That’s a big part of why the current trend is unsustainable.
You can’t have unemployment, gas prices and food prices all going up at the
same time without wrecking the real economy. Wall Street can only ignore
this for as long as government-provided liquidity allows the charade to
persist.”

Justice says what’s also interesting to note is that at the same time, “we
are also seeing a clear breakout in the base metals (along with crude oil
and gasoline). Copper, the ‘metal with a Ph.D. in economics,’ is leading the
way.”

“The ongoing optimism in base metals is almost certainly tied to China,”
Justice writes.

“China’s economy expanded at the fastest pace in a year,” Bloomberg reported
last week, “as stimulus spending and record lending growth helped the nation
lead the world out of recession.”

With a growing unemployment rate, small businesses in trouble, a market
rally that looks like it is ending… the real question, asks Yolanda
Fernandez Lommen of the Asian Development Bank, “is how long can the economy
sustain the stimulus package and when is the moment to exit these policies?”


* <http://clicks.taipanpublishinggroup.com//t/AQ/kVA/lu8/4ww/AQ/Ab++JA/Dcib>
*
------------------------------

*Global Opportunities: In the Know*

***U.S. Soldier Decodes Debt Clock. Global traveler Sara Nunnally forwards
some important information from an unexpected source.*

I want to forward something on to you all that I just came across yesterday.
I have a friend who served in Iraq. She’s back now, but still has friends in
action over there. One of the ways she’s staying in contact with them is
through Facebook.

Interestingly, a lot of the things they discuss are political, like
healthcare reform and even fiscal policies.

She says that her Marine buddies know more about these issues while serving
halfway across the world than many of her acquaintances here in the States.

Several of her friends have started a Facebook forum called “USA Down the
Crapper?” You can find the group
here.<http://clicks.taipanpublishinggroup.com//t/AQ/kVA/lu8/4w0/Ag/Ab++JA/Le1u>

I joined so that I could see what these soldiers are saying, and I found one
interesting post that really scared me.

What got me to share this info with you all, besides being inspired that
these Marines are risking their lives for us overseas and finding that they
are just as concerned – and even more involved than I am – about our
political affairs, is the following article from CNNMoney:

*Clock ticking on debt ceiling*
*This week Uncle Sam plans to sell $123 billion worth of Treasurys. That
will bring the country's debt level very close to the $12.1 trillion debt
ceiling.*

I want to share a post from the Facebook group by Jacob Jolly, called “Back
to the Math.” My friend describes him as a brilliant numbers guy, who can
break things down and find out what they really mean:

*Here’s the math that will really throw you for a loop. Assuming no
inflation, a constant GDP, a constant % interest rate, and a budget increase
of only how much more interest we have to pay on the debt that year, how
many years will it take before we are paying more interest on our national
debt than we will have to spend that year? (Complete economic collapse) *

*2010*
*a) Deficit: 1.75 trillion*
*b) Total Deficit: 13.7 trillion*
*c) Interest: 440.79 billion*
*d) Interest rate: b/c = 3.22%*

*2011 *
*A) Deficit: a + c = 2.191 trillion*
*B) Total Deficit: b + A = 15.891 trillion*
*C) Interest: B * 3.22% = 511.69 billion*

*2012*
*a) Deficit: A + C = 2.703 trillion*
*b) Total Deficit: B + a = 18.594 trillion*
*c) Interest: b * 3.22% = 598.73 billion*

*2013*
*A) Deficit: a + c = 3.299 trillion*
*B) Total Deficit: b + A = 21.893 trillion*
*C) Interest: B * 3.22% = 704.95 billion*

*2014*
*a) Deficit: A + C = 4.004 trillion (Deficit is now more than twice the
afforded budget)*
*b) Total Deficit: B + a = 25.897 trillion*
*c) Interest: b * 3.22% = 833.88 billion*

*2015*
*A) Deficit: a + c = 4.838 trillion*
*B) Total Deficit: b + A = 30.735 trillion*
*C) Interest: B * 3.22% = 989.667 billion*

*2016*
*a) Deficit: A + C = 5.828 trillion (Deficit is now more than three times
the afforded budget)*
*b) Total Deficit: B + a = 36.563 trillion*
*c) Interest: b * 3.22% = 1.177 trillion*

*2017*
*A) Deficit: a + c = 7.005 trillion (Deficit is now close to four times the
afforded budget)*
*B) Total Deficit: b + A = 43.568 trillion*
*C) Interest: B * 3.22% = 1.403 trillion*

*2018*
*a) Deficit: A + C = 8.408 trillion (Deficit is now more than four and a
half times the afforded budget)*
*b) Total Deficit: B + a = 51.976 trillion*
*c) Interest: b * 3.22% = 1.674 trillion*

*2019*
*A) Deficit: a + c = 10.082 trillion (Deficit is now over five and a half
times the afforded budget)*
*B) Total Deficit: b + A = 62.058 trillion*
*C) Interest: B * 3.22% = 1.998 trillion (Interest now exceeds total tax
revenue)*

*So again assuming that our growth in GDP cancels out inflation (Hahahaha
right. Oil is up almost 22% since my first note GDP might be up .1% if we’re
lucky), and that we have a constant interest rate (As the deficit rises it
also will rise), we have 5 years until the yearly deficit is twice the
affordable budget and 10 years until we will owe more interest on our debt
than we will have a tax base to collect on.*

*If we have high inflation, if our budget grows to more than it is this
coming year (healthcare bill), or the interest rate on our debt increases
(common sense), then we probably have 5… maybe 6 years at best.*

*No matter your political affiliation or philosophical view on life, you
should take this into account, and ensure you vote for someone who
understands fiscal responsibility.*

That’s some pretty scary math. There’s not going to be a quick fix to these
problems. And as we approach the debt ceiling CNNMoney wrote about, we will
have to wait and see what kind of moves our government will make. Can the
train even be stopped now?

The article says that we may breach the $12.1 trillion level as soon as
November…

It’s very much like a ticking clock.

That’s all for today’s issue of *Taipan Insider*. We’ll see you back here on
Thursday.

Cheers,
[image: Sara Nunnally, Global Traveler, Taipan Publishing Group]
Sara Nunnally
Senior Research Director, Global Traveler
Taipan Publishing Group

P.S. By the way… Here’s the backup for the numbers that Jacob Jolly used in
his calculations:

Obama Unveils $3.55 Trillion Blueprint
Budget<http://clicks.taipanpublishinggroup.com//t/AQ/kVA/lu8/4w4/AQ/Ab++JA/QtiG>
The Debt to the Penny and Who Holds
It<http://clicks.taipanpublishinggroup.com//t/AQ/kVA/lu8/4w8/AQ/Ab++JA/aI55>
Interest Expense on the Debt
Outstanding<http://clicks.taipanpublishinggroup.com//t/AQ/kVA/lu8/4xA/AQ/Ab++JA/339K>

------------------------------