The Beginning Of The End
The Beginning Of The End By Michael T. Snyder - Kindle Version

The Prepper's Blueprint

The Mystery Of The Shemitah
Don't Buy Survival Food Until You Read This - If you stockpile the wrong foods, you could be setting your family up to starve. It sounds harsh, but the truth is too many people with good intentions are making critical mistakes with their food stockpiles. Watch this video now >>
Gold Buying Guide: Golden Eagle Coins

Recent Posts

Archives

The United States Of Debt: Total Debt In America Hits A New Record High Of Nearly 60 Trillion Dollars

America Is BrokeWhat would you say if I told you that Americans are nearly 60 TRILLION dollars in debt?  Well, it is true.  When you total up all forms of debt including government debt, business debt, mortgage debt and consumer debt, we are 59.4 trillion dollars in debt.  That is an amount of money so large that it is difficult to describe it with words.  For example, if you were alive when Jesus Christ was born and you had spent 80 million dollars every single day since then, you still would not have spent 59.4 trillion dollars by now.  And most of this debt has been accumulated in recent decades.  If you go back 40 years ago, total debt in America was sitting at about 2.2 trillion dollars.  Somehow over the past four decades we have allowed the total amount of debt in the United States to get approximately 27 times larger.  This is utter insanity, and anyone that thinks this is sustainable is completely deluded.  We are living in the greatest debt bubble of all time, and there is no way that this is going to end well.  Just check out the chart…

Total Debt

When the last recession hit, total debt in America actually started going down for a short period of time.

But then the Federal Reserve and our politicians in Washington worked feverishly to reinflate the bubble and they assured everyone that everything was going to be just fine.  So Americans once again resorted to their free spending ways, and now total debt in the United States is rising at almost the same trajectory as before and has hit a new all-time record high.

We see a similar thing when we look at a chart for consumer debt in America…

Total Consumer Credit

For a while after the recession it was trendy to cut up your credit cards and get out of debt.

But that fad wore off rather quickly, didn’t it?

It is almost as if 2008 never happened.  We are making the same mistakes with debt that we did before.

As I noted recently, total consumer credit in the U.S. has risen by 22 percent over the past three years alone, and at this point 56 percent of all Americans have a subprime credit rating.

And have you noticed that a lot of people are not afraid to extend themselves in order to buy shiny new vehicles these days?

During the first quarter 0f this year, the size of the average vehicle loan soared to a new all-time record high of $27,612.

Five years ago, that number was just $24,174.

And as I noted in one recent article, the size of the average monthly car payment in this country is now up to $474.

That is practically a mortgage payment.

Speaking of mortgage payments, even though home sales have been falling and the rate of homeownership in the United States is the lowest that it has been in 19 years, a very large percentage of those who own homes are still overextended.

In fact, one recent survey discovered that a whopping 52 percent of Americans cannot even afford the house that they are living in right now.

At the same time, an increasing number of Americans are acting as if the last financial crisis never happened and are treating their homes like piggy banks.   Home equity loans are soaring again, and when the next great crisis strikes a lot of those people are going to end up getting into a lot of financial trouble.

There has been much written about what is wrong with the housing industry, but the truth is that home prices are still way too high and young adults cannot afford to purchase homes because they are already loaded down by huge amounts of debt even before they get to the point where they are ready to buy.

In fact, a newly released survey found that 47 percent of millennials are spending at least half of their paychecks on paying off debt…

Four in 10 millennials say they are “overwhelmed” by their debt — nearly double the number of baby boomers who feel that way, according to a Wells Fargo survey of more than 1,600 millennials between 22 and 33 years old, and 1,500 baby boomers between 49 and 59 years old.

To try to get out from underneath it, 47% said they spend at least half of their monthly paychecks on paying off their debts.

When I read that I was absolutely astounded.

Of course the biggest debt that many young adults are facing is student loan debt.  According to the Federal Reserve, there is now more than 1.2 trillion dollars of student loan debt in this country, and about 124 billion dollars of that total is more than 90 days delinquent.

What we have done to our young people is shameful.  We have encouraged them to sign up for a lifetime of debt slavery before they even understand what life is all about.  The following is an excerpt from my previous article entitled “Is College A Waste Of Time And Money?“…

In America today, approximately two-thirds of all college students graduate with student loan debt, and the average debt level has been steadily rising.  In fact, one study found that “70 percent of the class of 2013 is graduating with college-related debt – averaging $35,200 – including federal, state and private loans, as well as debt owed to family and accumulated through credit cards.”

That would be bad enough if most of these students were getting decent jobs that enabled them to service that debt.

But unfortunately, that is often not the case.  It has been estimated that about half of all recent college graduates are working jobs that do not even require a college degree.

Considering what you just read, is it a surprise that half of all college graduates in America are still financially dependent on their parents when they are two years out of college?

According to the U.S. Census Bureau, only 36 percent of all Americans under the age of 35 own a home at this point.  That is the lowest level that has ever been recorded.

And we are passing on to our young people the largest single debt in all of human history.  Weighing in at 17.5 trillion dollars, the U.S. national debt is a colossal behemoth.  And almost all of that debt has been accumulated over the past 40 years.  In fact, 40 years ago the U.S. national debt was less than half a trillion dollars.

But this is just the beginning.  As the Baby Boomer “demographic tsunami” washes through our economy, we are going to be facing a wave of red ink unlike anything we have ever contemplated before.

Meanwhile, the rest of the planet is drowning in debt as well.

As I wrote about the other day, the total amount of debt in the world has risen to a new all-time record high of $223,300,000,000,000.

Our “leaders” keep acting as if these debt levels can keep growing much faster than the overall level of economic growth indefinitely.

But anyone with even a shred of common sense knows that you can’t spend more money that you bring in forever.

At some point, a day of reckoning arrives.

2008 should have been a major wake up call that resulted in massive changes.  But instead, our leaders just patched up the old system and reinflated the old bubbles so that they are now even larger than they were before.

They assure us that they know exactly what they are doing and that everything will be just fine.

Unfortunately, they are dead wrong.

What Is Going To Happen If Interest Rates Continue To Rise Rapidly?

Question MarkIf you want to track how close we are to the next financial collapse, there is one number that you need to be watching above all others.  The number that I am talking about is the yield on 10 year U.S. Treasuries, because it affects thousands of other interest rates in our financial system.  When the yield on 10 year U.S. Treasuries goes up, that is bad for the U.S. economy because it pushes long-term interest rates up.  When interest rates rise, it constricts the flow of credit, and a healthy flow of credit is absolutely essential to the debt-based system that we live in.  Just imagine someone squeezing a tube that has water flowing through it.  The higher interest rates go, the more economic activity will be squeezed.  If interest rates continue to rise rapidly, it will be more expensive for the U.S. government to borrow money, it will be more expensive for state and local governments to borrow money, the housing market may crash again, consumer debt will become more expensive, junk bond investors will be in for a world of hurt, the stock market will experience a tremendous amount of pain and there is a good chance that we could see the 441 trillion dollar interest rate derivatives bubble implode.  And that is just for starters.

So yes, we all need to be carefully watching the yield on 10 year U.S. Treasuries.  On Friday, it opened at 2.76% and hit a high of 2.86% before closing at 2.83%.  The yield on 10 year U.S. Treasuries is up nearly 120 basis points since the beginning of May, and almost everyone on Wall Street seems convinced that it is going to go much higher.

We are truly moving into unprecedented territory, because we have been in a bull market for U.S. Treasuries for the last 30 years.  Many investors don’t even know that it is possible to lose money on U.S. Treasuries.  They have been described as “risk-free” investments, but that is far from the truth.

In fact, we could see bond investors of all types end up losing trillions of dollars before it is all said and done.

And those in the stock market will lose lots of money too.  Low interest rates are good for economic activity which is good for the stock market.  The chart posted below shows that stock prices have generally risen as the yield on 10 year U.S. Treasuries has steadily declined over the past 30 years…

CFPGH-DJIA-20

When interest rates rise, that is bad for economic activity and bad for stocks.  That is why so many stock analysts are alarmed that interest rates are going up so rapidly right now.

And as I wrote about the other day, we have just witnessed the largest cluster of Hindenburg Omens that we have seen since before the last financial crisis.  The stock market already seems ripe for a huge “adjustment”, and rising interest rates could give it a huge extra push in a negative direction.

By the time it is all said and done, stock market investors could end up losing trillions of dollars in the next stock market crash.

In addition, rising interest rates could easily precipitate another housing crash.  As the Wall Street Journal discussed on Friday, as the yield on 10 year U.S. Treasuries goes up it will also cause mortgage rates to rise…

Higher yields will push up long-term borrowing cost for U.S. consumers and businesses. Mortgage rates will rise, and investors are keeping a close eye on whether this may derail the recovery of the housing market, which has shown signs of turning a corner this year.

In one of my previous articles, I included an example that shows just how powerful rising mortgage rates can be…

A year ago, the 30 year rate was sitting at 3.66 percent.  The monthly payment on a 30 year, $300,000 mortgage at that rate would be $1374.07.

If the 30 year rate rises to 8 percent, the monthly payment on a 30 year, $300,000 mortgage at that rate would be $2201.29.

Does 8 percent sound crazy to you?

It shouldn’t.  8 percent was considered to be normal back in the year 2000.

If you own a $300,000 house today, do you think it will be easier to sell it or harder to sell it if mortgage rates skyrocket?

Yes, of course it will be much harder.  In fact, there is a good chance that you will have to reduce your selling price significantly so that prospective buyers can afford the payments.

Let us hope that the yield on 10 year U.S. Treasuries levels off for a while.  If it says at this current level, the damage will probably not be too bad.

But if it crosses the 3 percent mark and keeps soaring, things could get messy pretty quickly.  In fact, according to a Bank of America Merrill Lynch investor survey, the 3.5 percent mark is when the collapse of the bond market is likely to become “disorderly”…

Our latest Credit Investor Survey, conducted July 8-11, showed that 3.5% on the 10-year is most commonly thought of as the trigger of a disorderly rotation – i.e. higher interest rates leading to outflows and wider credit spreads – among high grade investors.

Put differently, 3.0% on the 10-year will not lead to overall wider credit spreads if there is enough buying interest from institutional investors (though note that the 10s/30s spread curve would flatten further, as mutual fund/ETF holdings are concentrated in the belly of the curve, whereas institutional demand is disproportional in the long end of the curve). However, if the probability of a further move higher in interest rates to 3.5% is high – which will be the perception if interest rate volatility is high – certain institutional investors will choose to remain on the sidelines.

Thus there may not be enough institutional buying interest to mitigate retail fund outflows and contain overall high grade spread levels.

So what is causing this?

Well, there are a number of factors of course, but one very disturbing sign is that foreigners are selling off U.S. Treasuries at a pace that we have not seen since 2007…

One of the biggest fears in the financial markets is that foreign investors will stop buying U.S. Treasury securities, causing borrowing rates to surge.

Not that this is the beginning of a frightening trend, but new data from the Treasury Department shows that foreigners were net sellers in June. In fact, this is the largest net sale of U.S. securities since August 2007.

Do you remember all of the warnings that we have received over the years about what would take place when foreign countries started dumping U.S. debt?

Well, it looks like it may be starting to happen.

Unfortunately, there is no way that the party that the U.S. government has been throwing can continue without foreigners buying our debt.  We have added more than 11 trillion dollars to the national debt since the year 2000, and according to Boston University economist Laurence Kotlikoff we are facing unfunded liabilities in future years that are in excess of 200 trillion dollars.

Even with foreigners continuing to loan us gigantic mountains of super cheap money, it would still take a doubling of our taxes to put us on a fiscally sustainable course…

Writing in the September issue of Finance and Development, a journal of the International Monetary Fund, Prof. Kotlikoff says the IMF itself has quietly confirmed that the U.S. is in terrible fiscal trouble – far worse than the Washington-based lender of last resort has previously acknowledged. “The U.S. fiscal gap is huge,” the IMF asserted in a June report. “Closing the fiscal gap requires a permanent annual fiscal adjustment equal to about 14 per cent of U.S. GDP.”

This sum is equal to all current U.S. federal taxes combined. The consequences of the IMF’s fiscal fix, a doubling of federal taxes in perpetuity, would be appalling – and possibly worse than appalling.

Prof. Kotlikoff says: “The IMF is saying that, to close this fiscal gap [by taxation] would require an immediate and permanent doubling of our personal income taxes, our corporate taxes and all other federal taxes.

“America’s fiscal gap is enormous – so massive that closing it appears impossible without immediate and radical reforms to its health care, tax and Social Security systems – as well as military and other discretionary spending cuts.”

Can you afford to pay twice as much in taxes to the federal government?

Very few Americans could.

But that is how serious the financial problems of the federal government are.

And all of the above assumes that interest payments on U.S. government debt will remain at current levels.  If the average rate of interest on U.S. government debt rises to just 6 percent, the U.S. government will be paying out a trillion dollars a year just in interest on the national debt.

Also, all of the above assumes that we will have a healthy financial system that does not need to be bailed out again.

But if rapidly rising interest rates cause the 441 trillion dollar interest rate derivatives bubble to implode, the bailout that the “too big to fail” banks will need will likely be far, far larger than last time.

In fact, once that bubble bursts there probably will not be enough money in the entire world to fix it.

If the picture that I have painted above sounds bleak, that is because it is bleak.

Sometimes I get frustrated with myself because I don’t feel I am communicating the tremendous danger that we are facing accurately enough.

We are heading for the worst financial crisis in modern human history, and the debt-fueled prosperity that we are enjoying today is going to go away and it is never going to come back.

You can dismiss that as “doom and gloom” and stick your head in the sand if you want, but that isn’t going to help anything.  Instead of ignoring reality you should be working hard to prepare your family for what is coming and warning others that they should be getting prepared too.

When a hurricane is approaching landfall, you don’t take your family out for a picnic at the beach.  That would be foolish.  Unfortunately, way too many Americans are acting as if nothing like the financial crisis of 2008 could ever possibly happen again.

If you deceive yourself into thinking that all of this is going to have a happy ending somehow, you are going to get blindsided by the coming storm.

But if you make preparations now, you might just be okay.

There is hope in understanding what is happening and there is hope in getting prepared.

So watch the yield on 10 year U.S. Treasuries.  The higher it goes, the later in the game we are.

Share This Chart With Anyone That Believes The U.S. Economy Is Not Going To Crash

Total Debt Growth vs. GDP GrowthAnyone that thinks that the U.S. economy can keep going along like this is absolutely crazy.  We are in the terminal phase of an unprecedented debt spiral which has allowed us to live far, far beyond our means for the last several decades.  Unfortunately, all debt spirals eventually end, and they usually do so in a very disorderly manner.  The chart that you are about to see is one of my favorite economic charts.  It compares the growth of U.S. GDP to the growth of total debt in the United States.  Yes, U.S. GDP has certainly grown at a decent pace over the years, but our total debt has absolutely exploded.  40 years ago, the total amount of debt in our system (government debt + corporate debt + consumer debt, etc.) was about 2 trillion dollars.  Today it has grown to more than 56 trillion dollars.  Our debt has grown at a much, much faster rate than our economy has, and there is no way in the world that we will be able to continue to do that for long.

Posted below is the chart that I was talking about.  The blue line is our total debt, and the red line is our GDP.  As you can see, this chart kind of speaks for itself…

Total Debt Growth vs. GDP Growth

So how did we get here?

Well, of course the federal government has been the biggest offender.  It would be a tremendous understatement to say that the politicians in Washington D.C. have been reckless.  Since the year 2000, the size of the U.S. national debt has grown by more than 11 trillion dollars.

Posted below is a chart that demonstrates the dramatic growth of the national debt as a percentage of GDP.  In particular, our debt has absolutely exploded as a percentage of GDP since the financial crisis of 2008…

National Debt As A Percentage Of GDP

Does that look sustainable to you?

Of course it isn’t.

Right now, the mainstream media is very excited that the federal budget deficit for this year might be less than a trillion dollars, but they are really missing the point.  The debt of the U.S. government is still growing much, much faster than the economy is, and the United States already has more government debt per capita than Greece, Portugal, Italy, Ireland or Spain.

What we are doing to future generations is absolutely criminal.  We are piling up mountains of debt that will haunt them for the rest of their lives just so that we can make the present a little bit more pleasant for ourselves.

As I noted in another article, during Obama’s first term the federal government accumulated more debt than it did under the first 42 U.S presidents combined.  And now we are entering a time period when demographic forces are going to put a tremendous amount of pressure on the finances of the federal government.

The Baby Boomers have started to retire, and they are going to want to start collecting on all of the financial promises that we have made to them.

As I have written about previously, the number of Americans on Medicare is projected to grow from a little bit more than 50 million today to 73.2 million in 2025.

The number of Americans collecting Social Security benefits is projected to grow from about 56 million today to 91 million in 2035.

Where are we going to get the money to pay for all of that?

Boston University economist Laurence Kotlikoff has calculated that the U.S. government is facing unfunded liabilities of 222 trillion dollars in the years ahead.

There is no simply no way that the U.S. government is going to be able to meet those obligations without wildly printing up money.

And of course the federal government is not the only one with massive debt problems.  We just saw the city of Detroit go bankrupt, and there are lots of other communities all over the nation that could soon follow.

Posted below is a chart that shows the growth of state and local government debt over the years.  In particular, please take note that the total amount of state and local government debt has grown from about 1.2 trillion dollars in the year 2000 to about 3 trillion dollars today…

State And Local Government Debt

But the chart posted above does not even take into account the massive unfunded pension obligations that state and local governments are facing.  According to the Detroit Free Press, state governments are facing unfunded pension obligations of nearly a trillion and a half dollars…

From Baltimore to Los Angeles, and many points in between, municipalities are increasingly confronted with how to pay for these massive promises. The Pew Center for the States, in Washington, estimated states’ public pension plans across the U.S. were underfunded by a whopping $1.4 trillion in 2010.

And many large cities are dealing with similar situations.  Detroit was the first to go down, but could Chicago or Los Angeles eventually be forced to declare bankruptcy too?…

Chicago recently saw its credit rating downgraded because of a $19-billion unfunded pension liability that the ratings service Moody’s puts closer to $36 billion. And Los Angeles could be facing a liability of more than $30 billion, by some estimates.

According to a report that was released earlier this year, the largest U.S. cities are facing hundreds of billions of dollars in unfunded pension liabilities at this point…

Early this year, the Pew Center released a survey showing that 61 of the nation’s largest cities — limiting the survey to the largest city in each state and all other cities with more than 500,000 people — had a gap of more than $217 billion in unfunded pension and health care liabilities. While cities had long promised health care, life insurance and other benefits to retirees, “few … started saving to cover the long-term costs,” the report said.

So where will all of that money come from?

That is a good question, and nobody has an easy answer at this point.

Meanwhile, U.S. consumers have been racking up staggering amounts of debt over the past several decades.  Just consider the following numbers…

-Total home mortgage debt in the United States is now about 5 times larger than it was just 20 years ago.

-Car loans just keep getting longer and longer, and approximately 70 percent of all car purchases in the United States now involve an auto loan.

-The total amount of student loan debt in America recently surpassed the one trillion dollar mark.

-One study discovered that approximately 41 percent of all working age Americans either have medical bill problems or are currently paying off medical debt, and according to a report published in The American Journal of Medicine medical bills are a major factor in more than 60 percent of the personal bankruptcies in the United States.

-Consumer debt in the United States has risen by a whopping 1700% since 1971, and 46% of all Americans carry a credit card balance from month to month.

Sadly, most people don’t realize how damaging credit card debt can be.  If you just carry an “average balance” on your credit cards each month, and those credit cards have just an “average” interest rate, you could end up paying millions of dollars to the credit card companies by the end of your life…

Let’s say you are an average American household, and you carry an average balance of $15,956 in credit card debt.

Also, as an average American household, let’s assume you pay an average current rate of 12.83%.

Finally, let’s assume you carry this average balance for 40 years, between ages 25 and 65.  How much did your credit card company make off of you and your extreme averageness?

Answer: $2,629,618.64

Incredibly, a large percentage of the population does not seem to understand these things.  An astounding 43 percent of all American families spend more than they earn each year.

Are you starting to understand why approximately half of all Americans die broke?

We are a nation that is completely and addicted to debt.

If you do not believe that it will ever catch up with us you are being delusional.

We have piled up the biggest mountain of debt in the history of the planet, and a day of reckoning is fast approaching.

The Student Loan Delinquency Rate In The United States Has Hit A Brand New Record High

College Graduation - Photo by Mando vzl37 million Americans currently have outstanding student loans, and the delinquency rate on those student loans has now reached a level never seen before.  According to a new report that was just released by the U.S. Department of Education, 11 percent of all student loans are at least 90 days delinquent.  That is a brand new record high, and it is almost double the rate of a decade ago.  Total student loan debt exceeds a trillion dollars, and it is now the second largest category of consumer debt after home mortgages.  The student loan debt bubble has been growing particularly rapidly in recent years.  According to the Federal Reserve, the total amount of student loan debt has risen by 275 percent since 2003.  That is a staggering figure.  Millions upon millions of young college graduates are entering the “real world” only to discover that they are already financially crippled for decades to come by oppressive student loan debt burdens.  Large numbers of young people are even putting off buying homes or getting married simply because of student loan debt.

So why is this happening?  Well, a big part of the problem is that the cost of college tuition has gotten wildly out of control.  Since 1978, the cost of college tuition has risen even more rapidly then the cost of medical care has.  Tuition costs at public universities have risen by 27 percent over the past five years, and there appears to be no end in sight.

We keep encouraging our young people to take out all of the loans that are necessary to pay for college, because a college education is supposedly the “key” to their futures.

But is that really the case?

Sadly, the reality of the matter is that millions of young Americans are graduating from college only to discover that the jobs that they were promised simply do not exist.

In fact, at this point about half of all college graduates are working jobs that do not even require a college degree.

This is leading to mass disillusionment with the system.  One survey found that 70% of all college graduates wish that they had spent more time preparing for the “real world” while they were still in college.

And because so many of them cannot get decent jobs, more college graduates then ever are finding that they cannot pay back the huge student loans that they were encouraged to sign up for.  The following is from a recent Bloomberg article.

Eleven percent of student loans were seriously delinquent — at least 90 days past due — in the third quarter of 2012, compared with 6 percent in the first quarter of 2003, according to the report by the U.S. Education Department.  Almost 30 percent of 20- to 24-year-olds aren’t employed or in school, the study found.

Everyone agrees that we are now dealing with an unprecedented student loan debt bubble, but none of our leaders seem to have any solutions.

The two charts posted below come from a recent Zero Hedge article, and they are very illuminating.  The first chart shows how the amount of student loan debt owned by the federal government has absolutely exploded in recent years, and the second chart shows how the percentage of student loan debt that is at least 90 days delinquent has risen to a brand new record high…

Delinquent Student Loans - Zero Hedge Chart

How is the economy ever going to recover if an increasingly large percentage of our young college graduates are financially crippled by student loan debt?

And things are about to get even worse.

If Congress takes no action, the interest rate on federal student loans is going to double to 6.8 percent on July 1st.  That rate increase would affect more than 7 million students.

And debt burdens just continue to increase in size.  In fact, according to one recent study, “70 per cent of the class of 2013 is graduating with college-related debt – averaging $35,200 – including federal, state and private loans, as well as debt owed to family and accumulated through credit cards.”

This is one reason why there is so much poverty among young adults in America today.  As I mentioned in a previous article, families that have a head of household that is under the age of 30 have a poverty rate of 37 percent.  For much more on the student loan debt bubble and how it is crippling an entire generation of Americans, please see my recent article entitled “29 Shocking Facts That Prove That College Education In America Is A Giant Money Making Scam“.

And of course delinquency rates remain very high on other forms of debt as well.  For example, delinquency rates on home mortgages have typically been around 2 to 3 percent historically.  But as you can see from the chart below, the delinquency rate on single-family residential mortgages is currently close to 10 percent…

Delinquency Rate On Single-Family Residential Mortgages

So are we really having an “economic recovery”?

Of course not.

Things are good for those that have lots of money in the stock market (for now), but for the vast majority of Americans things continue to get worse.

And we continue to forget the lessons that we should have learned from the financial crisis of 2008.  Right now, we are seeing a resurgence of cash out financing.  But this time, people are leveraging their inflated stock portfolios instead of their home equity.  The following is from a  CNN report

The recent run-up in the market, financial advisers say, has led to a resurgence of the type of loan not seen since the end of the housing boom — cash out financing. But this time, though, people aren’t tapping their inflated house for money. These days stock portfolios appear to be the well of choice.

Financial planners say in recent months clients have taken out so-called margin loans to buy real estate, fund small business acquisitions, or to provide gap financing before a traditional loan could be secured from a bank.

“No one wants to be out of the market for 90 days,” says Mark Brown, a financial planner for Brown Tedstron in Denver. “People just don’t want to sell right now.”

We are a nation that is absolutely addicted to debt.  We know that it is wrong, but we just can’t help ourselves.

We are like the 900 pound man that recently died.  He knew that he was eating himself to death, but he just couldn’t stop.

In the end, we are going to pay a great price for our gluttony.  Everyone in the world can see that we are killing the greatest economy that ever existed, but we simply do not have the self-discipline to do anything about it.

15 Signs That The Economy Is Rapidly Getting Worse As We Head Into 2013

How can the mainstream media claim that the U.S. economy is “improving” when it is painfully obvious to anyone with a brain that the middle class is being absolutely eviscerated?  According to numbers that were just released, the number of Americans on food stamps rose by more than 600,000 in a single month to an all-time record high of 47.7 million.  Youth unemployment in the U.S. is at a post-World War II high and large companies have announced the elimination of more than 100,000 jobs since Barack Obama won the election.  Consumer debt just hit a new record high and the federal government is accumulating debt at a much faster pace than it was at this time last year.  So where is the evidence that the economy is getting better?  The mainstream media says that the decline of the unemployment rate to “7.7 percent” is evidence that things are improving, but I showed how fraudulent that number is yesterday.  The percentage of working age Americans with a job today is exactly where it was back in September 2009 in the midst of the last major economic crisis.  The mainstream media is desperate for any shred of evidence that it can use to make people feel good and show that the Obama administration has our economy on the right track, and so they jump on any number that even looks remotely promising and they ignore mountains of evidence to the contrary.  They don’t seem to care that poverty is absolutely exploding and that the number of Americans on food stamps has risen by nearly 50 percent while Obama has been in the White House.  They don’t seem to care that the U.S. share of global GDP has fallen from 31.8 percent in 2001 to 21.6 percent in 2011.  They don’t seem to care that more good paying jobs are being shipped overseas with each passing day.  They don’t seem to care that formerly great U.S. cities that were once the envy of the entire globe are now crime-infested hellholes.  All they seem to care about is putting out news that makes people feel warm and fuzzy and making sure that Obama looks good.  Unfortunately, the truth is that the U.S. economy is steadily getting worse, and 2013 is not looking very promising at all right now.  Hopefully at some point the mainstream media will take a break from coverage of the royal pregnancy and the latest celebrity scandals to report on the real problems that we are facing right now.

The following are 15 signs that the economy is rapidly getting worse as we head into 2013…

#1 According to numbers that were just released, the number of Americans on food stamps has risen to a new all-time record of 47.71 million.  That is a huge increase of more than 600,000 over the previous reading of 47.10 million.  After about a year of slow growth, it looks like the number of Americans on food stamps is starting to skyrocket once again.  Back in the 1970s, about one out of every 50 Americans was on food stamps.  Today, about one out of every 6.5 Americans is on food stamps.

#2 Youth unemployment in the United States is now at the highest level that we have seen since World War II.

#3 According to Gallup, unemployment in the United States shot up very sharply during the month of November.

#4 It looks like the unemployment numbers are likely to get even worse.  Since the election, dozens of large companies have announced major layoffs.  Overall, large companies have announced the elimination of more than 100,000 jobs since November 6th.

#5 According to the Wall Street Journal, of the 40 biggest publicly traded corporate spenders, half of them plan to reduce capital expenditures over the coming months.

#6 Small business owners all over America are declaring that Obamacare is going to force them to start replacing full-time workers with part-time workers during 2013.

#7 One recent survey discovered that 40 percent of all Americans have $500 or less in savings.

#8 A different recent survey found that 28 percent of all Americans do not have a single penny saved for emergencies.

#9 62 percent of middle class Americans say that they have had to reduce household spending over the past year.

#10 Many Americans are trying to make ends meet for their families by going into more debt.  Consumer borrowing hit another brand new record high in October.  It looks like the American people have not learned from their past mistakes and have decided to roll up consumer debt at a faster pace than ever before.

#11 Median household income in America has fallen for four consecutive years.  Overall, it has declined by over $4000 during that time span.

#12 Wall Street bankers are expecting “the worst bonus season” since 2008.  Not a lot of people are going to shed tears over this one, but this is a sign that there is trouble in the financial world.

#13 Food banks all over America are reporting that more needy families than ever before are showing up to get food.

#14 As I wrote about yesterday, the federal government has run a deficit of $292 billion dollars during the first two months of fiscal 2013.  That figure is $57 billion higher than it was during the same period last year.  Government debt continues to soar wildly out of control and at some point all of that debt is absolutely going to crush us.

#15 I have written previously about how the once great city of Detroit has become a symbol of the downfall of the U.S. economy.  Well, now the state of Michigan is laying the groundwork for a “managed bankruptcy” of Detroit.  Sadly, many other large U.S. cities will likely follow suit over the next couple of years.

We should truly mourn for what is happening to Detroit.  At one time, it was one of the most beautiful cities on earth.  But now it is on the cutting edge of America’s economic decline.  You can see some amazing before and after pictures of an abandoned Detroit school right here.  Sadly, what is happening to Detroit will soon be happening to the rest of the country.

A similar thing is happening over in Europe.  Greece is on the cutting edge of Europe’s economic decline, and people over there are becoming very desperate.  The following is an excerpt from a Financial Post article about how the Greek middle class is turning to crime as the depression in that nation gets even worse…

In the once stable neighborhood of Kordelio, the unemployed and drug users gather in the parks, scaring away mothers and children, and crimes like chain snatching are on the rise. Many long-time residents have left, moving abroad or to their families’ villages, leaving behind empty houses, said Evangelia Rombou, 58, who has lived in Kordelio for 22 years.

But it is not just Greece that is grappling with these kinds of issues.  Now even countries that had been thought to be “stable” are experiencing significant problems.  For example, a massive crime wave has broken out in France.  The crime wave in France is being blamed on “austerity”, but the government of France still spends far more than it brings in.

So how bad would things get in France if the French government actually did go to a balanced budget?

And how bad would things get in the United States if the federal government was not stealing more than 100 million dollars an hour from our children and our grandchildren?

Even in the midst of our debt-fueled prosperity we are starting to see glimpses of how desperate people will become when our country is someday forced to live within its means.  For example, the following is from a report about an incident that happened in Columbus, Ohio the other day…

Columbus Police sprayed Mace on several people in a crowd that had gathered to sign up for a list to get subsidized housing at a northwest Columbus apartment complex.

Police said the crowd started to gather Friday night for the Saturday morning event at The Heritage apartment complex on Gatewood Road near Sunbury Road in northeast Columbus.

Authorities said that its highest number, the crowd reached 2,000 people.

Our entire economy is a giant mirage.  Our prosperity has been purchased by stealing from the future.  A few people have been warning that we have completely destroyed our future in the process, but both major political parties just continue to do it and the mainstream media just continues to cheer them on.

At some point this con game will end and this economic mirage will disappear.  When that happens, millions of people all over this country are going to become very angry and very desperate.

I hope that you have a plan for what you will do when that happens.

Everything Is Going To Be Alright?

Is the U.S. economy going to be okay?  Well, if the only source you listened to was the mainstream media, you would be left with the distinct impression that the U.S. economy is heading toward a full recovery and that everything is going to be alright.  Unfortunately, that is not the case at all.  The United States is rapidly becoming poorer as a nation and less competitive in the global marketplace.  At the same time, consumer debt levels are rising, corporate debt levels are rising, state and local government debt levels are rising and the U.S. government is indulging in a debt binge unlike anything the world has ever seen.  Considering the insane amount of money the U.S. government has been pumping into the economy, we should have seen a much more robust recovery by now.  Instead, the employment statistics have barely moved and government dependence is at an all-time high.  That is really sad, because this is as good as “the recovery” is going to get.  The next major economic downturn is just around the bend, and in future years millions of us will desperately yearn for the “good old days” of 2012.

Below, I have compiled a list of things that I have entitled “Everything Is Going To Be Alright?”

It is composed in the form of a song, but it really isn’t meant to be sung.  It is probably actually more of an economic horror poem than it is a song.  What I have tried to do is to point out the absurdity of what we are all being told by our politicians and by the media.  Hopefully you will enjoy reading it as much as I enjoyed writing it….

—–

Yahoo is going to be laying off thousands of workers starting next work.

Don’t worry about a thing – Barack Obama says everything is going to be alright.

Best Buy has just announced plans to close 50 stores.

Don’t worry about a thing – JPMorgan Chase CEO Jamie Dimon says everything is going to be alright.

The mayor of Los Angeles has announced that the city will be laying off “a large number of employees“.

Don’t worry about a thing – Barack Obama says everything is going to be alright.

Baltimore is so broke that it has decided to look into selling off some of the most famous historical landmarks in the city.

Don’t worry about a thing – the mainstream media says everything is going to be alright.

The city of Costa Mesa, California is so broke that is has decided to sell off its police helicopters.

Don’t worry about a thing – Barack Obama says everything is going to be alright.

The city of Trenton, New Jersey is so broke that it has decided to indefinitely postpone buying more toilet paper for city buildings.

Don’t worry about a thing – Joe Biden says everything is going to be alright.

The capital city of Pennsylvania is so broke that it has decided to start skipping debt payments.

Don’t worry about a thing – Barack Obama says everything is going to be alright.

The state of Nevada has a 12.3 percent unemployment rate.

Don’t worry about a thing – the pretty people on television say everything is going to be alright.

Total student loan debt in America has now passed the 1 trillion dollar mark, and about 270 billion dollars of those loans are at least 30 days delinquent.

Don’t worry about a thing – Barack Obama says everything is going to be alright.

The savings rate in the United States has fallen back to pre-financial crisis levels.

Don’t worry about a thing – Harry Reid says everything is going to be alright.

Home prices in the United States hit a 10 year low in the month of January.  They are now down 34.4 percent from the peak in 2006.

Don’t worry about a thing – Barack Obama says everything is going to be alright.

The average price of a gallon of gasoline in the United States is rapidly approaching the $4.00 mark.

Don’t worry about a thing – Anderson Cooper says everything is going to be alright.

Median household income in the United States is down 7.8 percent since December 2007 after adjusting for inflation.

Don’t worry about a thing – Barack Obama says everything is going to be alright.

When Barack Obama first took office, the number of “long-term unemployed workers” in the United States was approximately 2.6 million.  Today, that number is sitting at 5.6 million.

Don’t worry about a thing – Nancy Pelosi says everything is going to be alright.

The BRICS countries (Brazil, Russia, India, China and South Africa) are publicly declaring that it is time to move away from the U.S. dollar as the primary reserve currency of the world.

Don’t worry about a thing – Barack Obama says everything is going to be alright.

One out of every five Americans will be 65 or older by 2030 and nobody has any idea where all the money is going to come from to pay them the benefits that they have been promised.

Don’t worry about a thing – Rachel Maddow says everything is going to be alright.

More Americans are dependent on the government right now than at any other time in all of U.S. history.

Don’t worry about a thing – Barack Obama says everything is going to be alright.

The number of Americans on food stamps has increased by 14 million since Barack Obama became president and is sitting at an all-time record high.

Don’t worry about a thing – Hillary Clinton says everything is going to be alright.

The U.S. government will add more to the national debt in 2012 than it did from the time that George Washington became president to the time that Ronald Reagan became president.

Don’t worry about a thing – Barack Obama says everything is going to be alright.

The U.S. national debt is currently increasing by about 150 million dollars every single hour.

Don’t worry about a thing – Federal Reserve Chairman Ben Bernanke says everything is going to be alright.

The Federal Reserve bought approximately 61 percent of all government debt issued by the U.S. Treasury Department in 2011.  This is a Ponzi scheme that will completely collapse at some point.

Don’t worry about a thing – Barack Obama says everything is going to be alright.

—–

So what is your opinion?

Do you believe that everything is going to be alright?

Please feel free to leave a comment with your thoughts below….

24 Statistics To Show To Anyone Who Believes That America Has A Bright Economic Future

Beware of bubbles of false hope.  Right now there is a lot of talk about how the U.S. economy is improving, but it is all a lie.  The mainstream media can be very seductive.  When you sit down to watch television your brain tends to go into a very relaxed mode.  In such a state, it becomes easy to slip thoughts and ideas past your defenses.  Sometimes when I am watching television I realize what the media is trying to do and yet I can still feel it happening to me.  In this day and age, it is absolutely critical that we all think for ourselves.  When you look at the long-term trends and the long-term numbers, a much different picture of the U.S economy emerges than the one that is painted for us on television.  Over the long-term, the number of good jobs in America has been steadily going down.  Over the long-term, the number of Americans living in poverty and living on food stamps has been steadily going up.  Over the past couple of decades, tens of thousands of businesses, millions of jobs and trillions of dollars of our national wealth have gone out of the country.  Our debt is nearly 15 times larger than it was 30 years ago, and U.S. consumer debt has soared by 1700% over the past 40 years.  Year after year the rate of inflation goes up faster than our incomes do, and this is absolutely devastating the middle class.  Anyone who believes that we can keep doing the same things that we have been doing and yet America will still have a bright economic future is delusional.  Until the long-term trends which are taking the U.S. economy straight into the toilet are reversed, any talk of a bright economic future is absolute nonsense.

In America today, we have such a short-term focus.  We are all so caught up with what is happening right now.  Our attention spans seem to get shorter every single year.  At this point it would not be hard to argue that kittens have longer attention spans than most of us do.  (If you have ever owned a kitten you know how short their attention spans can be.)  Things have gotten so bad that most of our high school students cannot even answer the most basic questions about our history.  If people are not talking about it on Facebook or Twitter it is almost as if it does not even matter.

But any serious student of history knows that is is absolutely crucial to examine long-term trends.  And when you look at the long-term trends, it rapidly becomes apparent that the U.S. economy is in the midst of a nightmarish long-term decline.

The following are 24 statistics to show to anyone who believes that America has a bright economic future….

#1 Inflation is a silent tax that steals wealth from all of us.  We continue to shell out increasing amounts of money for the basic things that we need, and yet our incomes are not keeping pace.  Just check out the following example.  Gasoline prices have been trending higher for several years in a row as one blogger recently noted….

January 2009           $1.65

January 2010           $2.57

January 2011           $3.04

January 2012           $3.29

#2 If you can believe it, the average American household spent approximately $4,155 on gasoline during 2011.

#3 Electricity bills in the United States have risen faster than the overall rate of inflation for five years in a row.

#4 Health care costs continue to rise at a very alarming pace.  According to the Bureau of Economic Analysis, health care costs accounted for just 9.5% of all personal consumption back in 1980.  Today they account for approximately 16.3%.

#5 Getting a college education has also become insanely expensive in America.  After adjusting for inflation, U.S. college students are borrowing about twice as much money as they did a decade ago.

#6 To get the same purchasing power that you got out of $20.00 back in 1970 you would have to have more than $116 today.

#7 To get the same purchasing power that you got out of $20.00 back in 1913 you would have to have more than $457 today.

#8 There are fewer payroll jobs in the United States today than there were back in 2000 even though we have added more than 30 million extra people to the population since then.

#9 The U.S. economy is bleeding millions of good jobs.  Greedy CEOs are systematically shipping them overseas and our politicians are standing around and doing nothing about it.  This has gone on year after year after year.  The following is from a recent article by Paul Craig Roberts….

In the first decade of the 21st century, Americans lost 5,500,000 manufacturing jobs. US employment in the manufacture of computer and electronic products fell by 40%; in the production of machinery by 30%, in motor vehicles and and parts by 44%, and in the manufacture of clothing by 66%.

#10 Our economic infrastructure is being torn apart right in front of our eyes.  In 2010, an average of 23 manufacturing facilities a day shut down in the United States.  Overall, more than 56,000 manufacturing facilities in the United States have shut down since 2001.

We have made it legal for big corporations to send millions of jobs to countries where it is legal to pay slave labor wages, where the tax burden is much lighter and where there are barely any regulations.  The following is a brief excerpt from a recent article posted on Economy in Crisis….

Back in the ‘80s, I called my friend Walter in California and asked: “On your next expansion we need a plant in South Carolina.” Walter replied: “We don’t produce anything in the United States. It’s all in China. China furnishes you the plant on a year-to-year basis. If your investment works out, you don’t have to pay any corporate tax; just reinvest it for another plant and more profit. If it doesn’t work out, you can walk away with no legacy costs. I send a quality controller to watch production. I check on it every day. I don’t have any labor, health, safety, or environmental concerns, and have time to play a round of golf.” The bleeding of jobs off-shore started in the ‘80s — now hemorrhages under Bush and Obama. Waiting for the economy to bounce back; calling this “the worst recession” is a bum rap. The reason the economy hasn’t bounced back since 2008 is because the economy is being off-shored.

#11  As a result of our insane economic policies, our trade balances are absolutely exploding.  For example, the U.S. trade deficit with China in 2010 was 27 times larger than it was back in 1990.

#12 As you read this, there are millions of Americans out there wondering why they can’t find any jobs.  According to Reuters, 23.7 million American workers are either unemployed or underemployed right now.

#13 The number of good jobs has been steadily shrinking in America.  Since the year 2000, the United States has lost 10% of its middle class jobs.  In the year 2000 there were about 72 million middle class jobs in the United States but today there are only about 65 million middle class jobs.

#14 Over the last three decades, the percentage of low income jobs has consistently risen.  Back in 1980, less than 30% of all jobs in the United States were low income jobs.  Today, more than 40% of all jobs in the United States are low income jobs.

#15 The number of middle class neighborhoods also continues to decline.  In 1970, 65 percent of all Americans lived in “middle class neighborhoods”.  By 2007, only 44 percent of all Americans lived in “middle class neighborhoods”.

#16 A decade ago, the United States was ranked number one in average wealth per adult.  By 2010, the United States had fallen to seventh.

#17 Our incomes continue to go down.  Since December 2007, median household income in the United States has declined by a total of 6.8% once you account for inflation.

#18 Unfortunately, middle class Americans have been seeing their incomes decline for a very long time.  According to one study, between 1969 and 2009 the median wages earned by American men between the ages of 30 and 50 dropped by 27 percent after you account for inflation.

#19 Since 1971, consumer debt in the United States has increased by a whopping 1700%.  Unfortunately, U.S. consumers have still not learned how to stay out of debt.  According to a recent article posted on Financial Armageddon, the rate of personal savings in the United States is rapidly falling right now at the same time that the total amount of consumer credit is absolutely skyrocketing.

#20 The number of children living in poverty in America keeps rising year after year. The percentage of children living in poverty in the United States increased from 16.9 percent in 2006 to nearly 22 percent in 2010.

#21 The number of Americans on food stamps continues to set new all-time records.  Just check out the following progression….

October 2008: 30.8 million Americans on food stamps

October 2009: 37.6 million Americans on food stamps

October 2010: 43.2 million Americans on food stamps

October 2011: 46.2 million Americans on food stamps

#22 The U.S. debt problem has gotten completely and totally out of control.  Recently, the debt of the federal government surpassed 100% of GDP for the first time ever.

#23 During the Obama administration, the U.S. government has accumulated more debt than it did from the time that George Washington took office to the time that Bill Clinton took office.

#24 Barack Obama’s proposed 2012 budget projects that the national debt will rise to 26 trillion dollars a decade from now.  And his budget numbers are ridiculously optimistic.

Are you starting to get the picture?

All of the long-term economic numbers are progressively getting worse.

As the economy continues to crumble, large numbers of Americans are becoming really desperate.  For example, a recent Mother Jones article detailed how large numbers of formerly middle class Americans are now actually growing marijuana in an effort to make ends meet.

As things continue to get worse, people will become even more desperate.  There are millions of people out there that find themselves unable to pay the mortgage and put food on the table for their families.  When people hit rock bottom, they often find themselves doing things that they never dreamed that they would do.

Meanwhile, the big Wall Street banks just keep getting larger and more powerful.  We have allowed the “too big to fail” banks to become much bigger than they have ever been before.  The total assets of the six largest U.S. banks increased by 39 percent between September 30, 2006 and September 30, 2011.

Wealth is becoming increasingly concentrated at the very top even as the overall economic pie in America continues to get smaller.

As our economic problems become worse, more Americans than ever are trying to find ways to “escape”.

For example, according to one new government report one out of every six adults in America is a binge drinker.

Other Americans “tune out” by watching endless hours of television, by playing endless hours of video games or by indulging in endless hours of other forms of entertainment.

There are even some Americans that are giving up completely.  For example, one elderly man actually robbed a bank just so that he could get arrested and be taken to prison where he would get free health care.

But as I have written about previously, now is not the time to give up.  Instead, now is the time to prepare for the great challenges that are ahead.

Almost every generation in history has been faced with great challenges and great hardships at some point.

Yes, there will be some incredibly hard times ahead, but that also means that there will be a need for some great heroes.

Just because the U.S. economy is falling apart does not mean that life is over.

We are living during one of the most exciting times in all of human history.  Instead of cowering in fear, let us embrace these times and focus on becoming the people that we were created to be.

Ready Made Resources
Shocking Forecast
Thrive Life
FEMA Hates This

Austin Coins
High Blood Pressure?
FINCA BAYANO
Survive After Collapse

Silver.com

Camping Survival
GunMagWarehouse.com
SFC_The-Video-They-Tried-To-Ban_125
Print Friendly and PDF
Facebook Twitter More...