The big credit card companies don’t make much money off of those that pay their bills on time, and so they often specifically target less educated and less sophisticated consumers that don’t really understand the dangers of credit card debt. The goal is to find people that will carry credit card balances from month to month, because that is where the real money can be made. The average U.S. household that carries balances from month to month has approximately $15,310 in credit card debt right now. At an average interest rate of about 15 percent, the profits pile up very quickly for the big credit card companies. After all these years, so many of us still have not learned the truth about credit cards, and so credit card debt is absolutely crippling tens of millions of American families.
In 2015, the total amount of credit card debt in this country increased by a staggering 71 billion dollars. In a previous article, I explained to my readers that American consumers accumulated more new credit card debt during the fourth quarter of 2015 than they did during the entire years of 2009, 2010 and 2011 combined.
Many analysts are forecasting that the total amount of credit card debt will surpass a trillion dollars by the end of 2016. This is why there is such a crying need for financial education in this nation. Millions upon millions of us are being taken for a ride, and as I mentioned above, the big credit card companies often target those of us that are the least sophisticated about financial matters. The following comes from Bloomberg…
Credit-card companies need people to spend more than they can afford, but not so much that they default on their payments. So they could benefit from targeting individuals who are more likely to have cognitive failings. This is the dark side of behavioral finance.
Some new research by economists Antoinette Schoar of the Massachusetts Institute of Technology and Hong Ru of Nanyang Technological University claims to find exactly such a result. The authors use data from a private company that tracks credit-card offers. They find that less educated consumers — who are likely to be less financially sophisticated — are more frequently given offers that include back-loaded costs. Those are plans that start with low rates, but increase later, with extra-high over-limit and late-payment fees. In other words, those are likely to be the borrowers who make bad financial decisions — racking up debt and eventually paying much more in interest. Meanwhile, more educated households tend not to be offered these plans.
Do you understand what that is saying?
The large credit card companies want to find those of us that are the most vulnerable, because that is where their biggest profits can be made.
And of course most of us have gotten into trouble with credit card debt at some point. They don’t teach us how to manage our finances in high school or in college, and so most of us are very financially naive when we first get out into the real world. Card offers are being showered on our young people, and cash-strapped young adults can find it very easy to “buy now and pay later”…
Psychologically, it can be easier for people to pay using a credit card because no paper money is involved, Danford said. A Dun & Bradstreet study found that people spend an average of 12 to 18 percent more when using a credit card instead of cash.
“I think that’s one of the traps. It’s almost too easy to use a credit card,” Danford said. “You don’t have to think of the consequences.”
According to 2015 data from Experian, the average American had 2.24 credit cards, up from 2.18 in 2014.
Of all credit card users, what percentage do you think carries a balance from month to month?
Well, according to Time Magazine only 35 percent of those that use credit cards completely pay them off every single month. That means that 65 percent of those that use credit cards do carry a balance…
Only 35% of credit card users don’t carry a balance–they pay off their bill every month, like you’re supposed to. They use credit cards for convenience, and perhaps to generate bonus points and rewards, not because they need to borrow. If you’re a member of this group, you’re known as a “convenience user.” (Go ahead and pat yourself on the back for not being on the hook for high interest rates, but don’t gloat.) The other, more typical credit card users are known as “revolvers” because they don’t pay off their bills in full so the debt revolves. To them, credit limit increases are essentially invitations to spend more. It’s unsettling: “for revolvers, a 10% increase in credit is followed by a 1.3 percent increase in debt within one quarter and a 9.99% increase in debt over the long term,” the study found.
Unfortunately for the big credit card companies and the overall U.S. economy, it appears that U.S. consumers are starting to get tapped out.
Retail sales fell 2.9 percent in April, and then they dropped by 3.9 percent in May. As a result of these declining sales, corporate profits are suffering, and it is being projected that the final numbers for the second quarter of 2016 will show that corporate profits in the U.S. have now fallen for five quarters in a row.
That is not an “economic recovery”. Rather, that is what normally happens at the beginning of a major recession.
And don’t expect this to turn around any time soon, because Americans just don’t have the kind of discretionary income that they once did. The following comes from a New York Post article entitled “A staggering percentage of Americans are too poor to shop“…
Retailers have blamed the weather, slow job growth and millennials for their poor results this past year, but a new study claims that more than 20 percent of Americans are simply too poor to shop.
These 26 million Americans are juggling two to three jobs, earning just around $27,000 a year and supporting two to four children — and exist largely under the radar, according to America’s Research Group, which has been tracking consumer shopping trends since 1979.
So much of what is happening right now is very reminiscent of 2008. There was an explosion of credit card debt just before that crash as well.
We should have learned some very hard lessons the last time around, but we didn’t, and so now the pain for American families will be even greater this time.
If you are in credit card debt at this moment, it would be wise to try to eliminate it as soon as you can, because you definitely don’t want to be drowning in debt when times get really, really hard.
For the first time ever, total credit card debt in the United States is approaching a trillion dollars. Instead of learning painful lessons from the last recession, Americans continue to make the same horrendous financial mistakes over and over again. In fact, U.S. consumers accumulated more new credit card debt during the 4th quarter of 2015 than they did during the years of 2009, 2010 and 2011 combined. That is absolutely insanity, because other than payday loans, credit card debt is just about the worst kind of debt that consumers could possibly go into. Extremely high rates of interest, combined with severe penalties and fees, can choke the financial life out of almost any family in no time at all.
These days, most Americans use credit cards for various purposes, and they can be very convenient.
And if you pay them off every single month, they don’t become a problem.
Unfortunately, a lot of people are not doing this. According to CNBC, total U.S. credit card debt rose by an astounding 71 billion dollars last year alone…
Last year, credit card debt in the U.S. surged by approximately $71 billion to $917.7 billion, according to a new study from CardHub.com. The research also found that most of the debt accrued in 2015 came in the fourth quarter, when Americans tacked on more than $52 billion.
“With 7 of the past 10 quarters reflecting year-over-year regression in consumer performance, evidence is mounting to support the notion that credit card users are reverting to pre-downturn bad habits,” CardHub CEO Odysseas Papadimitriou said in a statement.
And as noted above, things were particularly gruesome during the 4th quarter of last year.
According to Alternet, Americans added more credit card debt during those three months than during the entire years of 2009, 2010 and 2011 combined…
Not since we headed into the Great Recession of 2008 have we been quite so loosey-goosey with our credit cards, racking up debt with stunning speed. Of our 4Q totals, CardHub notes, “during this one quarter, we added more debt than in 2009, 2010 and 2011 put together.” That brings dollars owed to credit card companies by each debt-saddled American family up to $7,879, the highest since the Great Recession.
I can’t even begin to describe how unwise this is. When I was in my twenties, I made the same mistakes that so many other Americans are making right now. I very foolishly racked up large balances on my credit cards, and it took years of extremely painful payments to fix those mistakes.
In America today, 37 percent of all households maintain credit card balances from month to month, and the average level of credit card debt for those households is $15,700. The following comes from CBS Minnesota…
According to NerdWallet, 37 percent of American households have credit card debt, which is defined as not paying off the full balance every month. Using data from the Federal Reserve of New York, U.S. Census and its own poll, NerdWallet found the average balance for those in credit debt is $15,700.
What most people don’t realize is that by letting balances run from month to month, you can end up paying just about as much in interest as you did for the original purchases.
Here is one credit card repayment scenario that comes from NerdWallet…
For the sake of simplicity in calculating the cost of the average credit card debt, let’s assume an APR of 16% and a fixed payment. We’ll also assume a minimum payment of 2% of the principal balance of $15,762, the average as of the end of 2015, or $315.
Based on those terms — and assuming you don’t add any more to your credit card balance — it would take 84 months, or seven years, to pay off the balance in full. During that time, you’ll pay $10,402 in interest — about two-thirds of the original balance — for a total of $26,164. This averages out to about $124 in interest per month.
The scenario above assumes that all payments are made on time. But a single late payment can trigger higher interest rates, penalties and fees that can be absolutely suffocating.
In fact, some people end up paying back three, four or five times as much as they originally borrowed to the credit card companies.
If you use credit cards for convenience or to buy things online or to automatically pay bills, that is fine. Just don’t let balances accumulate. As you can see, that can be financial suicide.
And as we head into a new global recession, you definitely don’t want to be saddled with high levels of debt. All of us have little luxuries that we can cut back on, and now is not the time to be living on the financial edge.
Just look at some of the troubling signs that we have seen in the news in recent days…
-The U.S. oil and rig count just dropped to the lowest level ever recorded
-One Houston CEO told employees that he was laying off that we have entered a “depression”
-It is being reported that 35 percent of all oil and gas companies around the world are at risk of falling into bankruptcy
-Unemployment in Canada just hit a three year high
-The number of job cuts in the United States skyrocketed 218 percent during the month of January according to Challenger, Gray & Christmas
-U.S. manufacturing activity has been in contraction for four months in a row
-U.S. factory orders have now fallen for 15 months in a row
-Subprime auto loan delinquencies have hit their highest level since the last recession
-Orders for Class 8 trucks in the United States dropped by 48 percent on a year over year basis in January
-The Restaurant Performance Index in the United States has dropped to the lowest level that we have seen since 2008
-Major retailers all over America are shutting down hundreds of stores
And this list does not even include all of the signs of severe economic trouble from around the rest of the planet that I have been writing about lately.
Credit card debt truly is financial poison, and it is not something that you want to have during the hard times that are coming.
Unfortunately, most Americans never learn, and they continue to rack up credit card debt as if there is no tomorrow even as the global economy starts to spiral downhill all around them.
Did you know that 95 percent of all retail sales in Sweden are cashless? And did you know that the government of Denmark has a stated goal of “eradicating cash” by the year 2030? All over the world, we are seeing a relentless march toward a cashless society, and nowhere is this more true than in northern Europe. In Sweden, hundreds of bank branches no longer accept or dispense cash, and thousands of ATM machines have been permanently removed. At this point, bills and coins only account for just 2 percent of the Swedish economy, and many stores no longer take cash at all. The notion of a truly “cashless society” was once considered to be science fiction, but now we are being told that it is “inevitable”, and authorities insist that it will enable them to thwart criminals, terrorists, drug runners, money launderers and tax evaders. But what will we give up in the process?
In Sweden, the transition to a cashless society is being enthusiastically embraced. The following is an excerpt from a New York Times article that was published on Saturday…
Parishioners text tithes to their churches. Homeless street vendors carry mobile credit-card readers. Even the Abba Museum, despite being a shrine to the 1970s pop group that wrote “Money, Money, Money,” considers cash so last-century that it does not accept bills and coins.
Few places are tilting toward a cashless future as quickly as Sweden, which has become hooked on the convenience of paying by app and plastic.
To me, giving money in church electronically seems so bizarre. But it is starting to happen here in the United States, and in Sweden some churches collect most of their tithes and offerings this way…
During a recent Sunday service, the church’s bank account number was projected onto a large screen. Worshipers pulled out cellphones and tithed through an app called Swish, a payment system set up by Sweden’s biggest banks that is fast becoming a rival to cards.
Other congregants lined up at a special “Kollektomat” card machine, where they could transfer funds to various church operations. Last year, out of 20 million kronor in tithes collected, more than 85 percent came in by card or digital payment.
And of course it isn’t just Sweden that is rapidly transitioning to a cashless society. Over in Denmark, government officials have a goal “to completely do away with paper money” by the year 2030…
Sweden is not the only country interested in eradicating cash. Its neighbor, Denmark, is also making great strides to lessen the circulation of banknotes in the country.
Two decades ago, roughly 80 percent of Danish citizens relied on hard cash while shopping. Fast forward to today, that figure has dropped dramatically to 25 percent.
“We’re interested in getting rid of cash,” said Matas IT Director Thomas Grane. “The handling, security and everything else is expensive; so, definitely we want to push digital payments, and that’s of course why we introduced mobile payments to help this process.”
Eventually, establishments may soon have the right to reject cash- a practice that is common in Sweden. Government officials have set a 2030 deadline to completely do away with paper money.
Could you imagine a world where you couldn’t use cash for anything?
This is the direction things are going – especially in Europe.
As I have written about previously, cash transactions of more than 2,500 euros have already been banned in Spain, and France and Italy have both banned all cash transactions of more than 1,000 euros.
Little by little, cash is being eradicated, and what we have seen so far is just the beginning. 417 billion cashless transactions were conducted in 2014, and the final number for 2015 is projected to be much higher.
Banks like this change, because it enables them to make more money due to the fees that they collect from credit cards and debit cards. And governments like this change because electronic payments enable them to watch, track and monitor what we are all doing much more easily.
These days, very rarely does anyone object to what is happening. Instead, most of us just seem to accept that this change is “inevitable”, and we are being assured that it will be for the better. And no matter where in the world you go, the propaganda seems to be the same. For example, the following comes from an Australian news source…
AND so we prepare to turn the page to fresh year — 2016, a watershed year in which Australia will accelerate towards becoming a genuine cashless society.
The cashless society will be a new world free of $1 and $2 coins, or $5 or $10 bank notes. A new world in which all commercial transactions, from buying an i-pad or a hamburger to playing the poker machines, purchasing a newspaper, paying household bills or picking up the dry-cleaning, will be paid for electronically.
And in that same article the readers are told that Australia will likely be “a fully cashless society” by 2022…
Research by Westpac Bank predicts Australia will be a fully cashless society by 2022 — just six years away. Already half of all commercial payments are now made electronically.
Even in some of the poorest areas on the entire globe we are seeing a move toward a cashless society. In 2015, banks in India made major progress on this front, and income tax rebates are being considered by the government as an incentive “to encourage people to move away from cash transactions“.
Would a truly cashless society reduce crime and make all of our lives much more efficient?
But what would we have to give up?
To me, America is supposed to be a place where we can go where we want and do what we want without the government constantly monitoring us. If people choose to use cashless forms of payment that is one thing, but if we are all required to go to such a system I fear that it could result in the loss of tremendous amounts of freedom and liberty.
And it is all too easy to imagine a world where a government-sponsored form of “identification” would be required to use any form of electronic payment. This would give the government complete control over who could use “the system” and who could not. The potential for various forms of coercion and tyranny in such a scenario is obvious.
What would you do if you could not buy, sell, get a job or open a bank account without proper “identification” someday? What you simply give in to whatever the government was demanding of you at the time even if it went against your fundamental beliefs?
That is certainly something to think about.
Many will cheer as the world makes a rapid transition to a cashless society, but I will not. I believe that a truly cashless system would open the door for great evil, and I don’t want any part of it.
What about you?
Would you welcome a cashless society?
Please feel free to share what you think by posting a comment below…
Has there ever been a major holiday more focused on materialism than the modern American Christmas? This year, Americans are planning to spend an average of 830 dollars on Christmas gifts, which represents a jump of 110 dollars over the average of 720 dollars last year. But have our incomes gone up accordingly? Of course not. In fact, real median household income in the United States has been experiencing a steady long-term decline. So in order to fund all of our Christmas spending, we have got to go into even more debt. We love to pull out our credit cards and spend money that we do not have on lots of cheap, useless stuff made on the other side of the world by workers making slave labor wages. We do the same thing year after year, and most of us have grown accustomed to the endless cycle of growing debt. In fact, one Pew survey found that approximately 70 percent of all Americans believe that “debt is a necessity in their lives”. But then we have to work our fingers to the bone to try to make the payments on all of that debt, not realizing that debt systematically impoverishes us. It may be hard to believe, but if you have a single dollar in your pocket and no debt, you have a greater net worth than 25 percent of all Americans. I know that sounds crazy, but it is true.
Overall, when you add up all forms of debt (consumer, business, local government, state government and federal government), Americans are more than 60 trillion dollars in debt.
Let that sink in for a bit.
40 years ago, that number was sitting at about 3 trillion dollars.
We have been on the greatest debt binge in the history of the world. Even though we were “the wealthiest, most prosperous nation on the entire planet”, we always had to have more. We just kept on borrowing and borrowing and borrowing from the future until we completely destroyed it.
And we still haven’t learned anything. Instead, this Christmas season we will be partying like it’s 2007…
Americans are planning on celebrating Christmas like it’s 2007.
A November survey by Gallup found that US adults are planning on spending about $830 on average on Christmas gifts this year.
That’s a huge jump from last year’s $720 average.
Notably, American consumers haven’t suggested a number that high since November 2007, when they were planning on spending $866 on average.
Sadly, our incomes simply do not justify this kind of extravagance. As Zero Hedge has pointed out, household incomes “actually peaked at least 15 years ago in 81% of U.S. counties.”
So why can’t we adjust our lifestyles to match?
Why must we always have more?
Here are more details on our declining incomes from the Visual Capitalist…
- Income peaked one year ago for many of the counties that are a part of the shale boom. This includes much of North and South Dakota, as well as parts of Texas, Nebraska, and Oklahoma. Income in Washington, D.C. and neighboring Arlington County also peaked then.
- In 1999, a total of 1,623 counties had their households reach peak income. The majority of these counties are in the Midwest and Southeast.
- The most southern part of California and parts of New England both peaked around 25 years ago.
- Many states along the Rocky Mountains such as Wyoming and Montana had counties that peaked roughly 35 years ago.
- Household income peaked in upstate New York, the northern tip of California, and southern Nevada at the same time that humans were first landing on the moon in 1969.
But you won’t hear this reported on the mainstream news, will you?
They want us to think that happy days are here again.
The following chart comes from the Federal Reserve, and it shows that real median household income in the United States has been trending down since 1999…
Americans should be having smaller Christmases instead of bigger ones, but that doesn’t fit the image of who we still think that we are.
Recently, I published an article entitled “Goodbye Middle Class: 51 Percent Of All American Workers Make Less Than 30,000 Dollars A Year” that was shared more than 44,000 times on Facebook. In that article, I included brand new figures that were just released by the Social Security Administration. As you can see, the quality of our jobs is not great…
-38 percent of all American workers made less than $20,000 last year.
-51 percent of all American workers made less than $30,000 last year.
-62 percent of all American workers made less than $40,000 last year.
-71 percent of all American workers made less than $50,000 last year.
Without a doubt, most American families should not be spending hundreds of dollars a year on Christmas gifts.
At these income levels, most American families are just barely surviving.
But once again this year, millions upon millions of Americans will flock to the malls and big box stores in a desperate attempt to make themselves happy.
Sadly, those efforts will be in vain. In fact, in a previous article I highlighted the fact that Christmas is the unhappiest season of the year. The suicide rate spikes to the highest level of the year during “the holidays”, and 45 percent of all Americans report that they dread the Christmas season. The following is an excerpt from a Psychology Today article…
We are told that Christmas, for Christians, should be the happiest time of year, an opportunity to be joyful and grateful with family, friends and colleagues. Yet, according to the National Institute of Health, Christmas is the time of year that people experience the highest incidence of depression. Hospitals and police forces report the highest incidences of suicide and attempted suicide. Psychiatrists, psychologists and other mental health professionals report a significant increase in patients complaining about depression. One North American survey reported that 45% of respondents dreaded the festive season.
In recent years, an increasing number of Americans have given up the tradition of Christmas gifts entirely, and many of them that I know seem quite happy to have done so.
Of course most people are still quite satisfied with the status quo, and there are many that will get very angry with you if you dare to suggest that the way that Americans celebrate Christmas has gotten way out of hand.
But shouldn’t it alarm us that for most Americans the biggest holiday of the year is all about the “stuff” they are going to buy, the “stuff” they are going to give and the “stuff” they are going to get?
As a society, we are obsessed with things, but those things are never going to make us happy.
Perhaps we should all take some time to reflect on the traditions that we choose to participate in and what they really mean to us during this “holiday season”…
Were you under the impression that your credit card transactions are private? If so, I am sorry to burst your bubble. As you will see below, there are actually multiple government agencies that are gathering and storing records of your credit card transactions. And in turn, those government agencies share that information with other government agencies that want it. So if you are making a purchase that you don’t want anyone to know about, don’t use a credit card. This is one of the reasons why the government hates cash so much. It is just so hard to track. In this day and age, the federal government seems to be absolutely obsessed with gathering as much information about all of us as it possibly can. But there is one big problem. What they are doing directly violates the U.S. Constitution. For those that are not familiar with it, the following is what the Fourth Amendment actually says: “The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.” Unfortunately, the Fourth Amendment is essentially dead at this point. The federal government is investigating all of us and gathering information on all of us all day, every day without end.
Many Americans have never even heard of the Consumer Financial Protection Bureau, but Judicial Watch has discovered that they are spending millions of dollars to collect and analyze our financial transactions…
Judicial Watch announced today that it has obtained records from the Consumer Financial Protection Bureau (CFPB) revealing that the agency has spent millions of dollars for the warrantless collection and analysis of Americans’ financial transactions. The documents also reveal that CFPB contractors may be required to share the information with “additional government entities.”
Judicial Watch was able to obtain some absolutely shocking documents thanks to a Freedom of Information Act request that it filed in April. The following is a summary of some of the things those documents show…
- Overlapping contracts with multiple credit reporting agencies and accounting firms to gather, store, and share credit card data as shown in the task list of a contract with Argus Information & Advisory Services LLC worth $2.9 million
- A provision stipulating that “The contractor recognizes that, in performing this requirement, the Contractor may obtain access to non-public, confidential information, Personally Identifiable Information (PII), or proprietary information.”
- A stipulation that “The Contractor may be required to share credit card data collected from the Banks with additional government entities as directed by the Contracting Officer’s Representative (COR).”
How do you feel about the fact that the government has contracts with “multiple credit reporting agencies and accounting firms to gather, store, and share credit card data”?
How do you feel about the fact that your credit card data and other “non-public, confidential information” may be shared with “additional government entities”?
Judicial Watch President Tom Fitton put it very well when he said that this “warrantless collection of the private financial information of millions of Americans is mind-blowing. Is there anything that this administration thinks it can’t do?”
But of course the Consumer Financial Protection Bureau is not the only one keeping records of your credit card transactions.
We have also recently learned that the NSA is doing it too. The following is from a recent Time Magazine article…
Networks are most likely giving the government “metadata.” That is, the credit card issuers could provide the NSA details such as an account or card number, where and when a purchase was made, and for how much. Even though the exact items purchased aren’t revealed, Brian Krebs, who blogs at KrebsOnSecurity.com, says “merchant category codes” in such data give clues about what was bought.
If the NSA is collecting data at the processor level, “at that point the transaction gets cleared and posts to an account, so, yes, you can track it down to a person,” Aufsesser says.
The NSA conceivably could — and probably would — be able get the names of individual account holders from banks issuing credit cards. ”I don’t see how you would anonymize it,” says Al Pascual, senior analyst for security, risk and fraud for Javelin Strategy & Research.
We are rapidly becoming a “Big Brother society” where the government tracks virtually every move that we make.
And don’t think that you can escape this by not using credit cards or by staying off of the Internet. The truth is that we are being tracked in hundreds of different ways.
For example, have you heard of automated license plate readers?
They are being installed on police vehicles all over the nation, and the amount of information that they are gathering on all of us is frightening.
A computer security consultant named Michael Katz-Lacabe asked the city of San Leandro, California for a record of every time that these license plate readers had scanned his vehicle, and what he discovered absolutely stunned him…
The paperback-size device, installed on the outside of police cars, can log thousands of license plates in an eight-hour patrol shift. Katz-Lacabe said it had photographed his two cars on 112 occasions, including one image from 2009 that shows him and his daughters stepping out of his Toyota Prius in their driveway.
That photograph, Katz-Lacabe said, made him “frightened and concerned about the magnitude of police surveillance and data collection.” The single patrol car in San Leandro equipped with a plate reader had logged his car once a week on average, photographing his license plate and documenting the time and location.
At a rapid pace, and mostly hidden from the public, police agencies throughout California have been collecting millions of records on drivers and feeding them to intelligence fusion centers operated by local, state and federal law enforcement.
Most Americans do not even know that these devices exist, but they have been “collecting millions of records” and feeding them into law enforcement databases all over the nation.
In San Diego alone, more than 36 million license plate scans have been fed into a regional database just since 2010…
In San Diego, 13 federal and local law enforcement agencies have compiled more than 36 million license-plate scans in a regional database since 2010 with the help of federal homeland security grants. The San Diego Association of Governments maintains the database. Like the Northern California database, the San Diego system retains the data for between one and two years.
“License-plate data is clearly identifiable to specific individuals,” said Lee Tien, a senior staff attorney at the Electronic Frontier Foundation. “This is like having your barcode tracked.”
Is this the kind of society that we want to become?
Do we really want the police to be taking millions of photographs of us?
Do we really want all of our financial transactions to be fed directly into federal databases?
Do we really want the government to track every phone call we make and every email we send?
As I wrote about recently, it has been documented that literally thousands of companies have been handing over customer data to the NSA.
Is this the kind of legacy that we want to leave for our children and our grandchildren?
Fortunately, it appears that at least some Americans are waking up to all of this.
According to a brand new Rasmussen survey, 56 percent of likely voters in the United States now believe that the federal government is a threat to individual rights…
A new Rasmussen Reports national telephone survey finds that 56% of Likely U.S. Voters now consider the federal government a threat to individual rights rather than a protector of those rights. That’s up 10 points from 46% in December.
While 54% of liberal voters consider the feds to be a protector of individual rights, 78% of conservatives and 49% of moderates see the government as a threat.
Overall, only 30% believe the feds today are a protector of individual rights. Fourteen percent (14%) are undecided. (To see survey question wording, click here.)
If the American people do not stand up and demand change, the people that are constantly violating our privacy are going to continue to do so.
Sadly, the vast majority of the politicians in both major political parties seem to think that there is nothing wrong with the status quo. So I wouldn’t expect any major changes in the short-term. But hopefully government surveillance will start to become such a major issue with the American people that the politicians will be forced to start addressing it.
How can anyone not see that the U.S. economy is collapsing all around us? It just astounds me when people try to tell me that “everything is just fine” and that “things are getting better” in America. Are there people out there that are really that blind? If you want to see the economic collapse, just open up your eyes and look around you. By almost every economic and financial measure, the U.S. economy has been steadily declining for many years. But most Americans are so tied into “the matrix” that they can only understand the cheerful propaganda that is endlessly being spoon-fed to them by the mainstream media. As I have said so many times, the economic collapse is not a single event. The economic collapse has been happening, it is is happening right now, and it will continue to happen. Yes, there will be times when our decline will be punctuated by moments of great crisis, but that will be the exception rather than the rule. A lot of people that write about “the economic collapse” hype it up as if it will be some huge “event” that will happen very rapidly and then once it is all over we will rebuild. Unfortunately, that is not how the real world works. We are living in the greatest debt bubble in the history of the world, and once it completely bursts there will be no going back to how things were before. Right now, we are living in a “credit card economy”. As long as we can keep borrowing more money, most people think that things are just fine. But anyone that has lived on credit cards knows that eventually there comes a point when the game is over, and we are rapidly approaching that point as a nation.
Have you ever been there? Have you ever desperately hoped that you could just get one more credit card or one more loan so that you could keep things going?
At first, living on credit can be a lot of fun. You can live a much higher standard of living than you otherwise would be able to.
But inevitably a day of reckoning comes.
If the federal government and the American people were forced at this moment to live within their means, the U.S. economy would immediately plunge into a depression.
That is a 100% rock solid guarantee.
But our politicians and the mainstream media continue to perpetuate the fiction that we can live in this credit card economic fantasy land indefinitely.
And most Americans could not care less about the future. As long as “things are good” today, they don’t really think much about what the future will hold.
As a result of our very foolish short-term thinking, we have now run up a national debt of 16.4 trillion dollars. It is the largest debt in the history of the world, and it has gotten more than 23 times larger since Jimmy Carter first entered the White House.
The chart that you see below is a recipe for national financial suicide…
Of course things have accelerated over the past four years. Since Barack Obama entered the White House, the U.S. government has run a budget deficit of well over a trillion dollars every single year, and we have stolen more than 100 million dollars from our children and our grandchildren every single hour of every single day.
It is the biggest theft of all time. What we are doing to our children and our grandchildren is beyond criminal.
And now our debt is at a level that most economists would consider terminal. When Barack Obama first entered the White House, the U.S. debt to GDP ratio was under 70 percent. Today, it is up to 103 percent.
We are officially in “the danger zone”.
If things really were “getting better” in America, we would not need to borrow so much money.
Our politicians are stealing from the future in order to make the present look better. During Obama’s first term, the federal government accumulated more debt than it did under the first 42 U.S presidents combined.
That is utter insanity!
If you started paying off just the new debt that the U.S. has accumulated during the Obama administration at the rate of one dollar per second, it would take more than 184,000 years to pay it off.
So what is the solution?
Get ready to laugh.
The most prominent economic journalist in the entire country, Paul Krugman of the New York Times, recently suggested the following in an article that he wrote entitled “Kick That Can“…
Realistically, we’re not going to resolve our long-run fiscal issues any time soon, which is O.K. — not ideal, but nothing terrible will happen if we don’t fix everything this year. Meanwhile, we face the imminent threat of severe economic damage from short-term spending cuts.
So we should avoid that damage by kicking the can down the road. It’s the responsible thing to do.
You mean that we might actually do damage to the debt-fueled economic fantasy world that we are living in if we stopped stealing so much money from future generations?
Oh the humanity!
It is horrifying to think that all that one of the “top economic minds” in America can come up with is to “kick the can” down the road some more.
Unfortunately, neither Paul Krugman nor most of the American people understand that our financial system is actually designed to create government debt.
The bankers that helped create the Federal Reserve intended to permanently enslave the U.S. government to a perpetually expanding spiral of debt, and their plans worked.
At this point, the U.S. national debt is more than 5000 times larger than it was when the Federal Reserve was first created.
So why don’t the American people understand what the Federal Reserve system is doing to us?
It is because most of them are still plugged into the matrix. A Zero Hedge article that I came across today put it beautifully…
US society in a nutshell: Chris Dorner has been around for a week and has 222 million results on Google; the Federal Reserve has been around for one hundred years and has 187 million results.
If nothing is done about our exploding debt, it is only a matter of time before we reach financial oblivion.
According to Boston University economist Laurence Kotlikoff, the U.S. government is facing a “present value difference between projected future spending and revenue” of 222 trillion dollars in the years ahead.
So how in the world are we going to come up with an extra 222 trillion dollars?
But it is not just the U.S. government that is drowning in debt.
Just check out this chart which shows the astounding growth of state and local government debt in recent years…
All over the United States there are state and local governments that are on the verge of bankruptcy. Just check out what is going on in Detroit. The only way that most of our state and local governments can keep going at this point is to also “kick the can” down the road some more.
And of course most of the rest of us are drowning in debt as well.
40 years ago, the total amount of debt in the U.S. economic system (government + business + consumer) was less than 2 trillion dollars.
Today, the total amount of debt in the U.S. economic system has grown to more than 55 trillion dollars.
Can anyone say bubble?
The good news is that U.S. GDP is now more than 12 times larger than it was 40 years ago.
The bad news is that the total amount of debt in our financial system is now more than 30 times larger than it was 40 years ago…
At the same time that we are going into so much debt, our ability to produce wealth continues to decline.
According to the World Bank, U.S. GDP accounted for 31.8 percent of all global economic activity in 2001. That number dropped to 21.6 percent in 2011. That is not just a decline – that is a nightmarish freefall. Just check out the chart in this article.
We are becoming less competitive as a nation with each passing year. In fact, the U.S. has fallen in the global economic competitiveness rankings compiled by the World Economic Forum for four years in a row.
Most Americans don’t understand this, but the United States buys far more from the rest of the world than they buy from us each year. In 2012, we had a trade deficit of more than 500 billion dollars with the rest of the world.
That means that more than 500 billion dollars that could have gone to U.S. workers and U.S. businesses went out of the country instead.
So how does our country survive if hundreds of billions of dollars more is flowing out of the country than is flowing into it?
Well, to make up the shortfall we go to the countries that we sent our money to and we beg them to lend it back to us. If that doesn’t work, we just print and borrow even more money.
Overall, the United States has run a trade deficit of more than 8 trillion dollars with the rest of the world since 1975.
That is 8 trillion dollars that could have saved U.S. businesses, paid the salaries of U.S. workers and that would have helped fund government.
But instead, our foolish policies have greatly enriched China and the oil barons of the Middle East.
Sadly, politicians from both political parties continue to boldly support the one world economic agenda of the global elite.
Just consider how destructive many of these “free trade” deals have been to our economy…
When NAFTA was pushed through Congress in 1993, the United States had a trade surplus with Mexico of 1.6 billion dollars.
By 2010, we had a trade deficit with Mexico of 61.6 billion dollars.
Back in 1985, our trade deficit with China was approximately 6 million dollars (million with a little “m”) for the entire year.
In 2012, our trade deficit with China was 315 billion dollars. That was the largest trade deficit that one nation has had with another nation in the history of the world.
In particular, our trade with China is extremely unbalanced. Today, U.S. consumers spend approximately 4 dollars on goods and services from China for every one dollar that Chinese consumers spend on goods and services from the United States.
But isn’t getting cheap stuff from China good?
No, because it costs us good paying jobs.
According to the Economic Policy Institute, the United States is losing half a million jobs to China every single year.
Overall, more than 56,000 manufacturing facilities in the United States have been shut down since 2001. During 2010, manufacturing facilities in the United States were shutting down at a rate of 23 per day. How can anyone say that “things are getting better” when our economic infrastructure is being absolutely gutted?
The truth is that there are never going to be enough jobs in America ever again, because millions of our jobs are being sent overseas and millions of our jobs are being lost to technology.
You won’t hear this on the news, but the percentage of the civilian labor force in the United States that is employed has been steadily declining every single year since 2006.
Younger workers have been hit particularly hard. In 2007, the unemployment rate for the 20 to 29 age bracket was about 6.5 percent. Today, the unemployment rate for that same age group is about 13 percent.
If you are under the age of 30 and you aren’t living with your parents, there is a really good chance that you are living in poverty. If you can believe it, U.S. families that have a head of household that is under the age of 30 have a poverty rate of 37 percent.
Our economy has been steadily bleeding huge numbers of middle class jobs, and many of those jobs have been replaced by low paying jobs in recent years.
According to one study, 60 percent of the jobs lost during the last recession were mid-wage jobs, but 58 percent of the jobs created since then have been low wage jobs.
And at this point, an astounding 53 percent of all American workers make less than $30,000 a year.
Oh, but “things are getting better”, right?
Maybe if you live on Wall Street or if you are an employee of the federal government.
But for most families this economic decline has been a total nightmare. Median household income in America has fallen for four consecutive years. Overall, it has declined by over $4000 during that time span.
Sometimes people forget how good things were about a decade ago. About three times as many new homes were sold in the United States in 2005 as were sold in 2012.
But we like to live in denial.
In fact, a lot of families are trying to keep up their standards of living by going into tremendous amounts of debt.
Back in 1983, the bottom 95 percent of all income earners in the United States had 62 cents of debt for every dollar that they earned. By 2007, that figure had soared to $1.48.
Fake it until you make it, right?
But how much debt can our system possibly handle?
Total home mortgage debt in the United States is now about 5 times larger than it was just 20 years ago.
Total credit card debt in the United States is now more than 8 times larger than it was just 30 years ago.
We are a nation that is completely addicted to debt, but as the financial crisis of 2008 demonstrated, all of that debt can have horrific consequences.
As the economy has slowed in recent years, the Federal Reserve has decided that “the solution” is to recklessly print money in an attempt to get the debt spiral cranked up again.
Have they gone overboard? You be the judge…
And of course this won’t have any affect on the value of the money that you have been saving up all these years right?
Every single dollar that you own is continually losing value…
Overall, the value of the U.S. dollar has declined by more than 96 percent since the Federal Reserve was first created.
As the cost of living continues to go up and wages continue to go down, millions of American families have fallen out of the middle class and into poverty.
If you can believe it, the number of Americans on food stamps has grown from about 17 million in the year 2000 to more than 47 million today.
But “things are getting better”, right?
Incredibly, more than a million public school students in the United States are homeless. This is the first time that has ever happened in our history.
But “things are getting better”, right?
There are now 20.2 million Americans that spend more than half of their incomes on housing. That represents a 46 percent increase from 2001.
But “things are getting better”, right?
In 1999, 64.1 percent of all Americans were covered by employment-based health insurance. Today, only 55.1 percent are covered by employment-based health insurance.
But “things are getting better”, right?
Today, more Americans than ever have found themselves forced to turn to the federal government for help.
Overall, the federal government runs nearly 80 different “means-tested welfare programs”, and at this point more than 100 million Americans are enrolled in at least one of them.
According to the U.S. Census Bureau, 49 percent of all Americans live in a home that receives direct monetary benefits from the federal government. Back in 1983, less than a third of all Americans lived in a home that received direct monetary benefits from the federal government.
So is it a good sign or a bad sign that the percentage of Americans that are financially dependent on the federal government is at an all-time high?
And in future years the number of Americans that are receiving benefits from the federal government is projected to absolutely skyrocket.
Back in 1965, only one out of every 50 Americans was on Medicaid. Today, one out of every 6 Americans is on Medicaid, and things are about to get a whole lot worse. It is being projected that Obamacare will add 16 million more Americans to the Medicaid rolls.
If you take a look at Medicare, things are very more sobering.
As I wrote recently, it is being projected that the number of Americans on Medicare will grow from 50.7 million in 2012 to 73.2 million in 2025.
At this point, Medicare is facing unfunded liabilities of more than 38 trillion dollars over the next 75 years. That comes to approximately $328,404 for every single household in the United States.
Are you ready to contribute your share?
Social Security is a complete and total nightmare as well.
Right now, there are approximately 56 million Americans collecting Social Security benefits.
By 2035, that number is projected to soar to an astounding 91 million.
Overall, the Social Security system is facing a 134 trillion dollar shortfall over the next 75 years.
Oh, but don’t worry because “things are getting better”, right?
I honestly do not know how anyone can look at the numbers above and come to the conclusion that the economy is in good shape.
We have accumulated the largest mountain of debt in the history of the world, our economic infrastructure is being gutted, we are bleeding good jobs, government dependence is at an all-time high and we are getting poorer as a nation with each passing day.
But other than that, everything is rainbows and lollipops, right?
If you want to see the economic collapse, just open up your eyes.
And if dramatic changes are not made quickly, things are going to get much, much worse from here.
Please share this article with as many people as possible. Time is quickly running out and there are a whole lot of people out there that we need to wake up while we still can.
What would you do if all the lights went out and they never came back on? That is a question that the new NBC series “Revolution” asks, but most people have no idea that a similar thing could happen in real life at any moment. A single gigantic electromagnetic pulse over the central United States could potentially fry most of the electronics from coast to coast if it was powerful enough. This could occur in a couple of different ways. If a powerful nuclear weapon was exploded at a high enough altitude, it could produce an electromagnetic pulse powerful enough to knock out electronics all over the country. Alternatively, a massive solar storm could potentially cause a similar phenomenon to happen just about anywhere on the planet without much warning. Of course not all EMP events are created equal. An electromagnetic pulse can range from a minor inconvenience to a civilization-killing event. It just depends on how powerful it is. But in the worst case scenario, we could be facing a situation where our electrical grids have been fried, there is no heat for our homes, our computers don’t work, the Internet does not work, our cell phones do not work, there are no more banking records, nobody can use credit cards anymore, hospitals are unable to function, nobody can pump gas, and supermarkets cannot operate because there is no power and no refrigeration. Basically, we would witness the complete and total collapse of the economy. According to a government commission that looked into these things, approximately two-thirds of the U.S. population would die from starvation, disease and societal chaos within one year of a massive EMP attack. It would be a disaster unlike anything we have ever seen before in U.S. history.
Most Americans are totally clueless about what an EMP attack could do to this nation, but the threat is very real. There was even a congressional commission that studied the potential effects of an EMP attack on the United States for eight years…
The US Congress in 2000 established the Congressional Commission to Assess the Threat to the United States from Electromagnetic Pulse (EMP) Attack. In 2004, the committee produced a 70-page executive summary on the EMP threat, and it issued a final report on the matter in 2008. According to the report, “several potential adversaries have or can acquire the capability to attack the United States with a high-altitude nuclear weapon-generated electromagnetic pulse (EMP). A determined adversary can achieve an EMP attack capability without having a high level of sophistication.”
Dr. William Graham was the chairman of that commission, and he says that an EMP attack could knock the United States back into the 1800s in just a single moment…
An EMP attack “could not only take down power grids, which are fragile anyway in this country, and telecommunications networks, and financial networks, and traffic controls and many other things, but in addition, there is a very close interrelationship among those national infrastructure capabilities,” Graham says.
“So, for example, we need telecommunications to re-establish the power network, and we need the power network to keep telecommunications going for more than a few hours. And we need the financial network to continue to operate to maintain the economy, we need the transportation system, roads, street lights, control systems, to operate just to get people to the failed power, telecommunication and other systems,” he adds.
Life after an EMP attack “would probably be something that you might imagine life to be like around the late 1800s but with several times the population we had in those days, and without the ability of the country to support and sustain all those people,” Graham says. “They wouldn’t have power. Food supplies would be greatly taken out by the lack of transportation, telecommunication, power for refrigeration and so on.”
Unfortunately, very few of us are equipped to survive in such an environment. We have become incredibly dependent on technology, and most Americans would have no idea how to do something as simple as growing their own food. Most people would be in a very serious amount of trouble in a very short period of time.
An article by Mac Slavo detailed some of the things that we could expect in the aftermath of a massive electromagnetic pulse…
The first 24 – 48 hours after such an occurrence will lead to confusion among the general population as traditional news acquisition sources like television, radio and cell phone networks will be non-functional.
Within a matter of days, once people realize the power might not be coming back on and grocery store shelves start emptying, the entire system will begin to delve into chaos.
Within 30 days a mass die off will have begun as food supplies dwindle, looters and gangs turn to violent extremes, medicine can’t be restocked and water pump stations fail.
Are you prepared for such an event?
If not, why not?
And actually, high altitude nuclear explosions and solar storms are not the only things that could produce sizable EMP bursts.
For example, the U.S. military has developed “a directed electromagnetic pulse gun” that can take out all electronics within a limited area. This kind of weapon can be fired from a plane, a cruise missile or even a drone. The following is from a recent WND article…
A pre-programmed cruise missile not too different from a drone has been proven to be capable of blasting out an EMP-type microwave that was able to destroy personal computers and electrical systems inside a building over which it was flying.
The U.S. Air Force and its contractor Boeing have created the High-powered Microwave Advanced Missile Project, or CHAMP, which was just tested over a Utah desert.
Other nations such as Russia and China are busy developing similar weapons. The ability to instantly take out the electronics of the enemy would be a very powerful advantage.
Even North Korea has been working on this kind of technology. According to Newsmax, it is believed that they may have tested a “Super-EMP” weapon back in 2009…
North Korea’s last round of tests, conducted in May 2009, appear to have included a “super-EMP” weapon, capable of emitting enough gamma rays to disable the electric power grid across most of the lower 48 states
As this technology becomes more widespread, it will soon be accessible to just about everyone. You don’t actually need a nuclear weapon to set off a massive electromagnetic pulse. A non-nuclear pulse generator can do the same thing. If you set one off next to a power station you could potentially take out the electrical grid for an entire region.
Terrorist groups and lone wolf crazies could even use portable radio frequency weapons to do a tremendous amount of electromagnetic damage over a more limited area. The following is from a recent article by F. Michael Maloof…
Such an individual with a penchant for electronics can pull together components from a Radio Shack or electronic store – even order the components off of selected Internet websites – and fashion a radio frequency, or RF, weapon.
As microprocessors become smaller but more sophisticated, they are even more susceptible to an RF pulse. The high power microwave from an RF weapon produces a short, very high power pulse, said to be billions of watts in a nanosecond, or billionths of a second.
This so-called burst of electromagnetic waves in the gigahertz microwave frequency band can melt electrical circuitry and damage integrated circuits, causing them to fail.
Constructing a radio frequency weapon is not that difficult. In fact, you can find instructions for how to build them on the Internet.
People need to realize that we live in a world where technology is absolutely exploding and we are dealing with threats that previous generations never even dreamed of. As the world becomes increasingly unstable, it is inevitable that these kinds of weapons will be used.
It is only a matter of time.
What will life look like after an EMP weapon is used?
That is something to think about.
And we also need to keep watching the sun. It could produce a massive electromagnetic pulse at literally any moment. As I have written about previously, scientists tell us that it is only a matter of time before we are hit with a technology-crippling solar super storm.
Most people don’t even realize that the massive solar storm of 1859 fried telegraph machines all over Europe and North America. If such a storm hit us today, the damage would potentially be in the trillions of dollars. The following is from a recent New York Times article…
A powerful solar (or “geomagnetic”) storm has the potential to simultaneously damage multiple transformers in the electricity grid and perhaps even bring down large sections of it, affecting upwards of a hundred million people in the United States for many months, if not years.
These huge transformers are expensive and difficult to replace, and not many are stockpiled in the United States for an emergency. In the worst case, the impact would be devastating: An outage could cost a few trillion dollars, with full recovery taking years. Not only would parts of the grid be compromised, but telephone networks, undersea cables, satellites and railroads also would be affected.
A 2008 National Academy of Sciences study warned that “because of the interconnectedness of critical infrastructures in modern society,” the “collateral effects of a longer-term outage” would likely include “disruption of the transportation, communication, banking and finance systems, and government services; the breakdown of the distribution of potable water owing to pump failure; and the loss of perishable foods and medications because of lack of refrigeration.”
By the way, 2013 is the peak of the current solar cycle. So we are moving into a time period when conditions will be very favorable for solar storms.
Let us hope that we are never hit with a massive electromagnetic pulse that is strong enough to take out all of our electronics.
But if it did happen, and all the lights went out for good, what would you do?
Please feel free to share your thoughts by leaving a comment below…