When the economy of a nation collapses, almost everything changes. Unfortunately, most people have never been through anything like that, so it can be difficult to know how to prepare. For those that are busy preparing for the coming global financial collapse, there is a lot to be learned from the economic depression that is happening right now in Greece. Essentially, what Greece is experiencing is a low level economic collapse. Unemployment is absolutely rampant and poverty is rapidly spreading, but the good news for Greece is that the global financial system is still operating somewhat normally and they are getting some financial assistance from the outside. Things in Greece could be a whole lot worse, and they will probably get a whole lot worse before it is all said and done. But already things have gotten bad enough in Greece that it gives us an idea of what a full-blown economic collapse in the 21st century may look like. There are reports of food and medicine shortages in Greece, crime and suicides are on the rise and people have been rapidly pulling their money out of the banks. Hopefully this article will give you some ideas that you can use as you prepare for the economic chaos that will soon be unfolding all over the globe.
The following are 10 things that we can learn about shortages and preparation from the economic collapse in Greece….
#1 Food Shortages Can Actually Happen
Most people assume that they will always be able to run out to their local supermarket or to Wal-Mart and get all of the supplies they need.
Unfortunately, that is a false assumption. The truth is that our food distribution system is extremely vulnerable.
In Greece, many people are starting to totally run out of food. Even some government institutions (such as prisons) are now reporting food shortages. The following was originally from a Greek news source….
The financing for many prisons has decreased to a minimum for some months now, resulting in hundreds of detainees being malnourished and surviving on the charity of local communities.
The latest example is the prison in Corinth where after the supply stoppage from the nearby military camp, the prisoners are at the mercy of God because, as reported by prison staff, not even one grain of rice has been left in their warehouses. When a few days earlier the commander of the camp announced to the prison management the transportation stoppage, citing lack of food supplies even for the soldiers, he shut down the last source of supply for 84 prisoners. The response of some Corinth citizens was immediate as they took it upon themselves to support the prisoners, since all protests to the Justice ministry were fruitless.
#2 Medicine Is One Of The First Things That Becomes Scarce During An Economic Collapse
If you are dependent on medicine in order to survive, you might want to figure out how you are going to get by if your supply of medicine is totally cut off someday.
In Greece, medicine shortages have become a massive problem. The following is from a recent Bloomberg article….
Mina Mavrou, who runs a pharmacy in a middle-class Athens suburb, spends hours each day pleading with drugmakers, wholesalers and colleagues to hunt down medicines for clients. Life-saving drugs such as Sanofi (SAN)’s blood-thinner Clexane and GlaxoSmithKline Plc (GSK)’s asthma inhaler Flixotide often appear as lines of crimson data on pharmacists’ computer screens, meaning the products aren’t in stock or that pharmacists can’t order as many units as they need.
“When we see red, we want to cry,” Mavrou said. “The situation is worsening day by day.”
The 12,000 pharmacies that dot almost every street corner in Greek cities are the damaged capillaries of a complex system for getting treatment to patients. The Panhellenic Association of Pharmacists reports shortages of almost half the country’s 500 most-used medicines. Even when drugs are available, pharmacists often must foot the bill up front, or patients simply do without.
#3 When An Economy Collapses, So Might The Power Grid
Try this some time – turn off all power to your home for 24 hours and try to live normally.
Sadly, most people simply do not understand just how dependent we are on the power grid. Without power, all of our lives would change dramatically.
In Greece, authorities are warning of an impending “collapse” of the power grid. If it goes down for an extended period of time in Greece, the consequences would be catastrophic….
Greece’s power regulator RAE told Reuters on Friday it was calling an emergency meeting next week to avert a collapse of the debt-stricken country’s electricity and natural gas system.
“RAE is taking crisis initiatives throughout next week to avert the collapse of the natural gas and electricity system,” the regulator’s chief Nikos Vasilakos told Reuters.
RAE took the decision after receiving a letter from Greece’s natural gas company DEPA, which threatened to cut supplies to electricity producers if they failed to settle their arrears with the company.
#4 During An Economic Collapse You Cannot Even Take Water For Granted
If the power grid goes down, you will soon no longer have clean water coming out of your faucets. That is one of the reasons why it is absolutely imperative that the power grid stay operable in Greece.
Sadly, most people don’t understand just how vulnerable our water system is. In a previous article, I quoted from a report that discussed how rapidly our water supply would be in jeopardy in the event of a major transportation disruption….
According to the American Water Works Association, Americans drink more than one billion glasses of tap water per day. For safety and security reasons, most water supply plants maintain a larger inventory of supplies than the typical business. However, the amount of chemical storage varies significantly and is site specific. According to the Chlorine Institute, most water treatment facilities receive chlorine in cylinders (150 pounds and one ton cylinders) that are delivered by motor carriers. On average, trucks deliver purification chemicals to water supply plants every seven to 14 days. Without these chemicals, water cannot be purified and made safe for drinking. Without truck deliveries of purification chemicals, water supply plants will run out of drinkable water in 14 to 28 days. Once the water supply is drained, water will be deemed safe for drinking only when boiled. Lack of clean drinking water will lead to increased gastrointestinal and other illnesses, further taxing an already weakened healthcare system.
What will you do when clean water stops coming out of your faucets?
You might want to start thinking about that.
#5 During An Economic Crisis Your Credit Cards And Debit Cards May Stop Working
Most people have become very accustomed to using either debit cards or credit cards for almost everything.
But what would happen if the financial system locked up for a period of time and you were not able to use them?
This is something that the citizens of Greece are potentially facing in the coming months, and this is something that all of us need to start thinking about.
#6 Crime, Rioting And Looting Become Commonplace During An Economic Collapse
Big corporations are already making extensive plans for how to protect their stores in the event that Greece switches from the euro to the drachma.
British electrical retailer Dixons has spent the last few weeks stockpiling security shutters to protect its nearly 100 stores across Greece in case of riot.
The planning, says Dixons chief Sebastian James, may look alarmist but it’s good to be prepared.
Company bosses around Europe agree. As the financial crisis in Greece worsens, companies are getting ready for everything from social unrest to a complete meltdown of the financial system.
#7 During A Financial Meltdown Many Average Citizens Will Start Bartering
During this economic depression, alternative currencies have already been popping up in Greece.
When things fall apart on a global scale, will you have things to barter for the things that you need?
#8 Suicides Spike During An Economic Collapse
When you think of the Great Depression of the 1930s, what do you think of?
Many people think of images of people jumping out of buildings.
Well, something similar has been happening in Greece. Suicide statistics in Greece have been absolutely soaring during the last couple of years.
Once prosperity disappears, many people feel as though life is not worth living anymore.
#9 Your Currency May Rapidly Lose Value During An Economic Crisis
Just remember what happened in Germany during the Weimar Republic and what has happened recently in places like Zimbabwe.
The truth is that it can happen anywhere.
Right now, Greeks are pulling their money out of the banks because they are worried that their euros will be turned into drachmas which would rapidly lose value.
If I was living in Greece I would definitely be concerned about that. The return of the drachma seems to get closer with each passing day. Just check out these screenshots.
#10 When Things Hit The Fan The Government Will Not Save You
Has the government of Greece come to the rescue of all of those that are deeply suffering right now?
Of course not. The truth is that the Greek government can barely take care of itself at the moment.
History has shown us that governments simply cannot be counted on when things hit the fan.
Just remember what happened during the aftermath of Hurricane Katrina.
In the end, the only one that can be counted on to take care of you and your family is you.
Preparation is going to look different for every family. No two situations are exactly the same.
But there are some practical steps that nearly all of us can take to better position ourselves for what is coming. Now is the time to get educated and now is the time to take action.
Or you could be like all of those that laughed at Noah while he was building that big boat.
In the end, things did not work out too well for those folks.
Another month, another bad jobs report. For the month of May, the U.S. economy only added 69,000 jobs and the unemployment rate rose to 8.2%. Many are calling this a total “disaster” and are worried that the U.S. economy could be headed back into another recession. Economists had been expecting 150,000 payroll jobs would be added, so the 69,000 number really shocked a lot of people. The truth is that the economy needs to add approximately 125,000 new jobs every single month just to keep the unemployment rate steady. So yes, this bad jobs report is not welcome news at all – especially for the Obama administration. When Barack Obama first took office the unemployment rate was sitting at 7.6 percent and now it is sitting at 8.2 percent. Some “recovery”, eh? But the reality is that this jobs report was really not that “devastating” even though the stock market had its worst day of the year. Unemployment in America is still about at the same level as it was back at the beginning of 2012. The tough stretch that we are going through right now is only a very small taste of the economic nightmare that is on the horizon. If you think that things are a “disaster” right now, just wait until you see what is coming.
At the moment, 53 percent of all Americans with a bachelor’s degree under the age of 25 are either unemployed or underemployed, and there are more than 100 million working age Americans that do not currently have jobs.
But this is only just the beginning.
During the next major economic downturn, the unemployment rate in the United States is going to soar well up into the double digits.
Many Americans will look back on 2010, 2011 and 2012 as “the good old days”.
Right now, there are only small pockets of the country that are total economic hellholes.
For example, Yuma, Arizona has an unemployment rate of 26 percent, and El Centro, California has an unemployment rate of 26.2 percent.
In the future, those kinds of numbers are going to become the norm all over the nation.
Sadly, most Americans have no idea what is coming.
Today, I wanted to share with you all a couple of chilling economic forecasts that I have been made aware of recently.
The first is from Raoul Pal. According to Zero Hedge, Raoul Pal “previously co-managed the GLG Global Macro Fund in London for GLG Partners, one of the largest hedge fund groups in the world. Raoul came to GLG from Goldman Sachs where he co-managed the hedge fund sales business in Equities and Equity Derivatives in Europe… Raoul Pal retired from managing client money in 2004 at the age of 36 and now lives on the Valencian coast of Spain, from where he writes.”
The following is from a Zero Hedge summary of a recent presentation by Raoul Pal….
We don’t know exactly what is to come, but we can all join the very few dots from where we are now, to the collapse of the first major bank…
With very limited room for government bailouts, we can very easily join the next dots from the first bank closure to the collapse of the whole European banking system, and then to the bankruptcy of the governments themselves.
There are almost no brakes in the system to stop this, and almost no one realises the seriousness of the situation.
The problem is not Government debt per se. The real problem is that the $70 trillion in G10 debt is the collateral for $700 trillion in derivatives…
Yes, that equates to 1200% of Global GDP and it rests on very, very weak foundations
From an EU crisis, we only have to join one dot for a UK crisis of equal magnitude.
And then do you think Japan and China would not be next?
And then do you think the US would survive unscathed?
That is the end of the fractional reserve banking system and of fiat money.
It is the big RESET.
It continues:
Bonds will be stuck at 1% in the US, Germany, UK and Japan (for this phase).
The whole bond market will be dead.
Short selling on bonds – banned
Short selling stocks – banned
CDS – banned
Short futures – banned
Put options – banned
All that is left is the Dollar and Gold
It only gets better. We use the term loosely:
We have around 6 months left of trading in Western markets to protect ourselves or make enough money to offset future losses.
Spend your time looking at the risks of custody, safekeeping, counterparty etc. Assume that no one and nothing is safe.
After that…we put on our tin helmets and hide until the new system emerges
So how soon does Raoul Pal think all of this is going to happen?….
From a timing perspective, I think 2012 and 2013 will usher in the end.
You can find his entire presentation entitled “The End Game” right here.
There is no stopping this…We are still on track as I have been predicting for a while now for a fall/winter collapse of the Eurozone and naked exposure of all derivative markets the world over. Europeans will go through a major reset, after time they will recover as Europeans do not carry the type of personal debt that Americans do. It is for America that I worry. Look for these signs next:
1- JPM will be bailed out again but it will not stop the coming market crash. More details will emerge about their derivative swap failure $150 billion and counting.
2-BOA (BAC Bank of America) will fold and be absorbed into JPM as a way to prop up the bleeding Giant. JPM will get the best picking of this deal just like they got with Bear Stearns.
3- Massive layoffs at Citigroup and Wells Fargo
4- Goldman Sachs finally pays the piper, look for massive cuts there as well as BIG Losses
5- Bond market bust which leads to freeze of all bond sales
6- Derivative bust the next one will be BOA followed by Citigroup
7- All CDS shorts and swaps will freeze.
8- Total Meltdown
You can read the rest of what that source is saying right here.
As I have been saying all along, there are two keys that you need to be watching right now….
#1 Europe
#2 Derivatives
Sadly, the articles that I write about Europe tend to get far less of a response than my other articles get. Most Americans simply do not understand that what is happening in Europe right now is going to significantly affect their daily lives.
And most Americans have very little understanding of derivatives. But as you just read, there are some in the financial community that are warning that we could see the derivatives bubble burst very soon.
Time is running out. This period of relative stability that we are currently experiencing will not last forever.
America has been overrun by control freaks. Once upon a time the United States was considered to be “the land of the free and the home of the brave”, but today there are millions of laws, rules and regulations that tightly regulate our daily lives. Most of these laws, rules and regulations were established by people who believed that they had “good intentions”, but at this point the nanny state has become so oppressive that it is strangling the life out of us. If you look back throughout history, the societies that have really thrived have had a very high degree of liberty and freedom. When the bureaucrats get the upper hand, it can suck the life out of any economy. Unfortunately, our political system seems to be a magnet for control freaks. These control freaks truly believe that they know better than the rest of us and they are systematically moving toward taking total control of our lives. Our rights are being stripped away a little bit more with each passing day, and we are being told that we need a “permit” or a “license” for almost everything. Many younger Americans have been living this kind of “straight jacket existence” for so long that they don’t even remember what real liberty and freedom are. We are steamrolling down the road toward totalitarianism, and most Americans don’t even realize what is happening.
Sadly, there are many Americans that actually agree that the state should regulate nearly every detail of our lives. There are many Americans that actually believe that life is better when there are millions of rules that we all have to follow. There are many Americans that actually believe that too much liberty and freedom is a bad thing.
If we are not careful the control freaks are going to destroy this nation. They always tell us that the rules that they are imposing upon us are “for our own good”, but every time they lay another burden on our backs they just suck a little bit more life out of us all.
The following are 18 examples of the nanny state gone wild….
#1 New York City Mayor Michael Bloomberg has announced that he wants to ban the sale of all large sodas and sugary drinks in order to fight obesity. Personally I don’t have any sodas in my refrigerator, but I certainly do not want the government telling me that I am banned from drinking large sodas. Every American should have the freedom to decide if they want to drink soda or not.
#2 In North Carolina, authorities are threatening to send a blogger to prison for blogging about his battle against diabetes….
Steve Cooksey has learned that the definition, at least in the eyes of the state board, is expansive.
When he was hospitalized with diabetes in February 2009, he decided to avoid the fate of his grandmother, who eventually died of the disease. He embraced the low-carb, high-protein Paleo diet, also known as the “caveman” or “hunter-gatherer” diet. The diet, he said, made him drug- and insulin-free within 30 days. By May of that year, he had lost 45 pounds and decided to start a blog about his success.
But this past January the state diatetics and nutrition board decided Cooksey’s blog — Diabetes-Warrior.net — violated state law. The nutritional advice Cooksey provides on the site amounts to “practicing nutrition,” the board’s director says, and in North Carolina that’s something you need a license to do.
#3 In San Francisco, if you do not recycle your trash correctly you can be fined up to $500.
#4 The following are just some of the cities that have started using RFID tracking chips to monitor the recycling habits of their citizens….
*Cleveland, Ohio
*Charlotte, North Carolina
*Alexandria, Virginia
*Boise, Idaho
*Dayton, Ohio
*Flint, Michigan
#5 In Minnetonka, Minnesota you can be fined up to $2,000 for having a muddy vehicle.
#6 In Hazelwood, Missouri it is against the law for little girls to sell girl scout cookies in front of their own homes.
#8 Over the past couple of years there have been quite a few instances all over the country where lemonade stands run by children have been shut down by police because the children had not acquired the proper permits.
#9 State legislatures all over the country have been passing legislation making it more difficult for parents to opt out of having their children vaccinated.
#10 In many U.S. states is it now illegal to collect any rain that falls on to your own property.
#11 In San Juan Capistrano, California it is against the law to hold a home Bible study without a “conditional use permit“.
#12 In New York City, it is against the law to smoke at public parks and beaches.
#13 In California,”food confiscation teams” visit the homes of people that have been discovered to have purchased raw milk. The following is from a recent Natural News article….
In a bombshell revelation of the depth of the food police state that now exists in LA County, California, NaturalNews has learned that the LA County health department has unleashed door-to-door raw milk confiscation teams to threaten and intimidate raw dairy customers into surrendering raw milk products they legally purchased and own.
According to Mark McAfee (see quotes below), both LA County and San Diego county have attempted to acquire customer names and addresses from Organic Pastures (www.OrganicPastures.com) for the sole purpose of sending “food confiscation teams” to customers’ homes to remove the raw milk from customers’ refrigerators. Using both phone calls and home visits, these teams intimidate customers and try to force them to give up their milk.
#16 In Louisiana, one church was ordered to stop passing out water because it did not have the proper permit.
#17 At public schools all over the United States, the lunches that little children bring from home are now inspected to make sure that they meet USDA guidelines. The following is one recent report of this phenomenon from North Carolina….
A preschooler at West Hoke Elementary School ate three chicken nuggets for lunch Jan. 30 because the school told her the lunch her mother packed was not nutritious.
The girl’s turkey and cheese sandwich, banana, potato chips, and apple juice did not meet U.S. Department of Agriculture guidelines, according to the interpretation of the person who was inspecting all lunch boxes in the More at Four classroom that day.
The Division of Child Development and Early Education at the Department of Health and Human Services requires all lunches served in pre-kindergarten programs — including in-home day care centers — to meet USDA guidelines. That means lunches must consist of one serving of meat, one serving of milk, one serving of grain, and two servings of fruit or vegetables, even if the lunches are brought from home.
#18 Today, a vast array of government agencies is constantly monitoring what all of us say and do on the Internet. They claim that this helps makes us all more “safe” and “secure”.
In order to maintain proper “control” over our lives, the nanny state is obsessed with watching us and monitoring us. This point was beautifully made in a recent article by Chuck Baldwin….
America is no longer “one nation under God.” Today, America is “one nation under surveillance.” Cameras monitoring our every movement, satellites taking pictures of our homes, listening devices being used to record our conversations, hi-tech computers capturing virtually every piece of correspondence, banking institutions forwarding our private financial records to Big Brother, and now armed drones flying over the neighborhoods of the American citizenry all reveal that America is anything but the “land of the free.”
Is this really how we want to live?
Do we want our children and our grandchildren to live their lives in a nation that is increasingly coming to resemble totalitarian regimes like North Korea?
Yes, every society needs laws.
But we don’t need millions of them.
Our founders intended to create a society where liberty and freedom would be maximized, and all of that liberty and freedom helped create an environment that gave birth to the greatest economic machine that the world has ever seen.
But now the control freaks are choking the life out of our society. Please take a stand against them while you still can.
Why does the state of California seem to be so incredibly hopeless? These days California can’t seem to do anything right, and if you live in California things just got a whole lot worse. Governor Brown has announced that the state budget deficit for this year is going to be much larger than projected, that more government services are going to be cut and that voters are going to vote on another round of tax increases in November. Meanwhile, unemployment is sitting at 11 percent and extended federal unemployment benefits for workers in the state are ending. Because California is one of the worst places in the nation to conduct business, there has been a steady flow of companies leaving the state. Those companies have taken a whole lot of good jobs with them. Due to the lack of jobs and a steady stream of impoverished immigrants coming in from Mexico and other countries, poverty in the state has exploded and crime is rapidly increasing. California may be the land of “endless sunshine”, but for the California economy there are only dark clouds on the horizon. The state is coming apart at the seams and there is not much hope that things are going to turn around any time soon.
These days, California is very similar to Greece in many ways.
Just like Greece, California has had round after round of “austerity” and yet still cannot seem to balance the budget.
Even after all of the cuts that have been implemented in recent years, the California budget deficit is still going to be far larger than originally projected this year. The following is from the Los Angeles Times….
Gov. Jerry Brown announced on Saturday that the state’s deficit has ballooned to $16 billion, a huge increase over his $9.2-billion estimate in January.
The bigger deficit is a significant setback for California, which has struggled to turn the page on a devastating budget crisis. Brown, who announced the deficit on YouTube, is expected to outline his full budget proposal on Monday in Sacramento.
“This means we will have to go much further, and make cuts far greater, than I asked for at the beginning of the year,” Brown said in the video.
During his remarks on YouTube, Governor Brown stated that California is “still recovering from the worst recession since the 1930s” and he stressed that hard choices are ahead.
But the California state government has already cut back in so many places. For example, back in the late 1970s the state of California was number one in per-pupil spending on education, but now California has fallen to 48th place.
Unfortunately, Governor Brown does not believe that budget cuts alone will solve the problem.
So you know what that means.
Tax increases!
The tax increases that California voters will be voting on in November were outlined in a recent Bloomberg article….
Brown this week submitted more than 1.5 million signatures to place the tax measure on the ballot. It would temporarily raise the state sales tax, already the highest in the U.S., to 7.5 percent from 7.25 percent. It would also boost rates on income starting at $250,000. The 10.3 percent levy on those making $1 million or more would rise to 13.3 percent, the most of any state.
Get ready to fire up the moving vans.
The rest of the California economy may be falling apart, but moving companies will continue to do very well.
As I have written about previously, California has already experienced a net loss of approximately four million residents to other states over the past 20 years.
If the top rate on those making a million dollars or more a year hits 13.3 percent you will see a lot more wealthy people leave.
And thousands of businesses have left California in recent years as well. Sadly, one survey found that CEOs ranked California as the worst place in the United States to do business for seven years in a row.
You would think that the state legislature would get the message.
Unfortunately they have not.
California absolutely suffocates businesses with rules and regulations and it gets worse with each passing year.
So lots of good jobs continue to leave the state.
As mentioned earlier, the official rate of unemployment in California is sitting at 11 percent. That is almost 3 points higher than for the nation as a whole.
Of course the “official” numbers greatly understate the true scope of the unemployment problem, but for more on that you can check out this article.
However you want to look at it, the reality is that California has a massive unemployment problem.
Sadly, a whole bunch of unemployed workers in California are about to lose their unemployment benefits.
On Saturday, more than 200,000 unemployed Americans were dumped off the unemployment rolls. Close to half of them live in California.
Instead of 99 weeks, unemployed workers in California will now only be able to collect unemployment benefits for a maximum of 79 weeks.
It is estimated that a total of 93,000 people in California have suddenly lost their benefits as a result of this change.
Unfortunately, the truth is that the employment picture in California is not really getting any better. It is still incredibly difficult to find a decent job.
Unless you are “connected”, it can be a horribly frustrating experience trying to find a new job in this economic environment.
But if you are truly desperate, there are some folks out there who are always hiring.
These days, “national security” is quite a growth industry. For example, if you are currently unemployed you can always apply to work as an Internment/Resettlement Specialist for the national guard.
While the economy is going to pot, you can get paid to lock up other Americans that are protesting about the state of our country.
Doesn’t that sound fun?
But seriously, if you live in California right now you probably don’t need anyone else to tell you how bad things are.
You probably already know that the number of children living in poverty in the state of California has increased by 30 percent since 2007.
California is rapidly changing, and not for the better.
But it is not just the economy that is falling apart in California. The truth is that there are a whole host of good reasons to move away from California. The traffic is nightmarish, crime is on the rise, the gangs are bigger and more active than ever before, millions of illegal immigrants have poured into the state, and the control freak politicians become more insane with each passing year.
Plus there is the constant threat that your home will be destroyed by a mudslide, a wildfire or an earthquake.
One of these days the “big one” will hit California.
The truth is that economic conditions are horrible in most of the country and are rapidly getting a whole lot worse.
According to one poll, 30 percent of all Americans described the condition of the economy as “good” back in February but only 20 percent do now.
When we enter the next major economic downturn, unemployment is going to go higher everywhere in the nation.
There will be small pockets where jobs are still plentiful (where the oil industry is strong for example) but almost everywhere else will be really hurting.
So what do all of you think?
For people looking to move away from California, where should they go?
Please feel free to post a comment with your thoughts below….
69 members of the U.S. House of Representatives have sent Barack Obama a letter expressing their concern that a new international treaty currently being negotiated would essentially ban all “Buy American” laws. This new treaty is known as the Trans-Pacific Partnership, and it is going to be one of the biggest “free trade” agreements in history. Critics are referring to it as the “NAFTA of the Pacific“, and it would likely cost the U.S. economy even more jobs than NAFTA did. At the moment, the Trans-Pacific Partnership includes Brunei, Chile, New Zealand and Singapore. Barack Obama is pushing hard to get the United States into the TPP, and Australia, Peru, Malaysia, Vietnam, Canada, Japan and South Korea are also reportedly interested in joining. But quite a few members of Congress have heard that “Buy American” laws will essentially be banned under this agreement, and this has many of them very concerned. You can read the entire letter that was sent to Obama right here. Unfortunately, the leaders of both major political parties are overwhelmingly in favor of the Trans-Pacific Partnership, so the objections of these 69 members of Congress are likely to fall on deaf ears. The Trans-Pacific Partnership will accelerate the flow of American jobs out of this country, and meanwhile our politicians will continue to insist that they are doing everything that they can to “create jobs”.
There is not much protecting American jobs these days. The “Buy American” laws are one of the last remaining barriers that helps protect against much, much cheaper foreign labor, but now “Buy American” laws are in danger of being banned permanently as a recent article in the Huffington Post explained….
Since the 1930s, the American government has offered preferential treatment to American producers in the awarding of federal contracts. If a domestic producer offers the government a more expensive bid than a foreign producer, it can still be awarded the contract under certain circumstances, but more recent free trade agreements have granted other nations the same negotiating status as domestic firms. The Obama administration is currently pushing to grant the several nations involved in the Trans-Pacific deal the same privileged status, according to the Thursday letter.
The big problem is that foreign companies often have huge advantages over firms based in America.
In the United States, we have minimum-wage laws. On the other side of the globe, it is legal to pay workers less than a dollar an hour with no benefits.
In the United States, we have thousands upon thousands of laws and regulations that businesses must comply with. On the other side of the globe, there is often very little red tape.
The truth is that “free trade” is a really bad deal for the average American worker. In the emerging one world economic system, labor has become a global commodity and U.S. workers must now compete for jobs with people on the other side of the planet.
Since U.S. workers are often 10 to 20 times more expensive than workers on the other side of the world, there has been a massive outflow of jobs from this country. Treaties such as the Trans-Pacific Partnership will accelerate those job losses.
You would think that our politicians would notice that our formerly great manufacturing cities are turning into hellholes.
For example, the following is how James Kunstler described what he saw when he traveled through Gary, Indiana recently….
Between the ghostly remnants of factories stood a score of small cities and neighborhoods where the immigrants settled five generations ago. A lot of it was foreclosed and shuttered. They were places of such stunning, relentless dreariness that you felt depressed just imagining how depressed the remaining denizens of these endless blocks of run-down shoebox houses must feel. Judging from the frequency of taquerias in the 1950s-vintage strip-malls, one inferred that the old Eastern European population had been lately supplanted by a new wave of Mexicans. They had inherited an infrastructure for daily life that was utterly devoid of conscious artistry when it was new, and now had the special patina of supernatural rot over it that only comes from materials not found in nature disintegrating in surprising and unexpected ways, sometimes even sublimely, like the sheen of an oil slick on water at a certain angle to the sun. There was a Chernobyl-like grandeur to it, as of the longed-for end of something enormous that hadn’t worked out well.
The economic guts of this country are being ripped to shreds right in front of our eyes.
Overall, more than 56,000 manufacturing facilities in the United States have been shut down since 2001.
That number is so crazy that it is hard to fully grasp.
There are hundreds of statistics which prove this. I don’t have space in this article to reproduce them all, but if you are interested in examining many of them I recommend checking out the following articles….
When you combine a market that has expensive labor with markets that have ultra-cheap labor, it is inevitable that large numbers of jobs will migrate to the areas that have the ultra-cheap labor.
This isn’t rocket science.
That is why “Buy American” laws are such a good thing. They help to protect American jobs.
But even if you do not work in an industry where large numbers of jobs are being sent out of the country, the loss of jobs still affects you. The millions of Americans that are being displaced from jobs that have been sent overseas end up applying for other kinds of jobs. So they become your competition. This increases the demand for the jobs that remain and it keeps wages down.
As I wrote about the other day, 95 percent of the jobs lost during the last recession were middle class jobs. Many of those jobs have been replaced by low income jobs, but you can’t support a family on a low income job.
The Obama administration tells us that the unemployment rate is going down, but the truth is that there are now almost 101 million working age Americans that do not have jobs.
Instead of looking at the “unemployment rate” which is manipulated so much, what I prefer to do is to look at the “employment rate“. And sadly, the percentage of Americans with a job has been steadily declining. The following are the percentages of working age Americans with a job during April during the past six years….
April 2007: 63.0%
April 2008: 62.7%
April 2009: 59.8%
April 2010: 58.7%
April 2011: 58.4%
April 2012: 58.4%
Some Americans have decided to escape the lousy job market by going back to school. Others have decided to retire early. Yet others have decided to become full-time dependents of the government, and a shocking number have decided to try to get on to the Social Security disability rolls.
But most Americans that are unemployed just want to get back to work. Many suffer in complete anonymity and many never take a single penny from the government. They just want someone to hire them so that they can put in an honest day of work for an honest day of pay once again.
Even if you still have a good job, it could be gone tomorrow. This point was underscored by a comment that a reader identified as “DaytoDay” left on a recent article….
Well, I can relate to this, I just lost my job Tuesday. I worked for Uhaul and on the DAY that I became eligible for my benefits and 401k they canned me, exactly 90 days.
So, it’s just another reminder that those who work for corporations are nothing more than numbers. It’s sad reality, they don’t care if you have a family to feed, they don’t care about your bills, and they damn sure don’t care about quality…
I was notified while working, and was instantly let go, up until that point, there had been no warnings, no emails, no conferences, nothing… They simply fired me to avoid paying the benefits and 401k that was would have been entitled to.
And to think, this is the reward for being a good hard worker?
Other Americans are not able to find any work at all. This is especially true for young Americans. Millions upon millions of hard working Americans are graduating from college only to find that the “real world” can be very cruel.
For example, just check out the comment that a reader named “Simon” left on one of my recent articles….
I graduated from a top university just after the Collapse of 2008 (Class of ’09). I had already seen the number of customers at my college job go way down in that year. Got my four-year degree, had good grades, good work record. Now I live in south FL and I can’t even get a job in fast food, there is so much competition for minimum-wage jobs. No one wants to hire me to wait tables or bag groceries because I have a prestigious degree. The only thing I got out of college was 10 grand in debt, which is actually quite small (I came from a poor family, so I got a lot of free tuition to bribe me to be part of the university indoctrination). Good thing I defaulted on my loans a year or two ago or I would be in worse trouble. I just throw out all their threatening letters and never answer their calls- my friend told me it would work, and it did. Of course I’m no longer a “good citizen”- I don’t earn money, don’t pay taxes, don’t have health insurance, my credit is horrible, I’ll never buy a home or a new car—but who cares?
Millions of other Americans that have lost their jobs have been forced to take whatever they can get. A reader identified as “Gary2″ recently left a comment on one of my articles describing what his family has been through….
Check this out—I had 12 years as a good worker (regional manager level position) several promotions-steller reviews-which I kept copies of BTW) regular good pay increases heck I even saved a persons life, got a big award plack for it, pictures with everyone etc and 4 months later was downsized–no warning no thanks for helping them pass many JACHO inspections (I was a regional manager for a hospital chain) nothing. Just that we decided to outsource your entire department and that you are no longer needed.
So now I get to be grossly underemployed making 1/2 of what I used to make with NO benefits. My wife is no longer a stay at home raise the kids mom and is also working. Together we still make less than I did on my own. This sucks.
As millions upon millions of Americans suffer deeply month after month, it is creating a volcano of anger and frustration that could absolutely devastate our society at some point. A reader identified as “Cinderella Man” left the following comment on a recent article….
If anyone thinks that almost 50 million Americans on food stamps is a sign of recovery and pardon my language but you have **** for brains. The other day I went shopping and I spent $170 on my ten bags of food and I watched a man and his daughter ring up ten packs of cheap balogna he meekly asked the clerk if those were the 10 for 10 deal and she said yes. Then the Dad said to the daughter “I hope you like it were going to be eating it till we bust!” This is what our world has come to. A man is feeding his kid trying to stretch their meager food stamp budget by eating balogna for several meals. I couldnt help but think of the movie of my namesake Cinderella Man with Russell Crowe when his wife was frying balogna for every meal back during the first Great Depression. Ive seen it all in these past 4 years. From beautiful women in souplines and ****** hotels to living in my car and watching inflation destroy all of our lives. We are all 9 meals from anarchy.
But our politicians continue to integrate us even more deeply into the emerging one world economic system. Huge numbers of jobs will continue to leave this nation and the standard of living for most American workers will continue to decline.
So have any of you ever had your job shipped out of the country? Feel free to post a comment with your thoughts below….
What happens when debt-fueled false prosperity disappears? Just look at Spain. The 4th largest economy in the eurozone was riding high during the boom years, but now the Spanish economy is collapsing with no end in sight. When a debt bubble gets interrupted, the consequences can be rather chaotic. Just like we saw in Greece, austerity is causing the economy to slow down in Spain. But when the economy slows down, tax revenues fall and that makes it even more difficult to meet budget targets. So even more austerity measures are needed to keep debt under control and the cycle just keeps going. Unfortunately, even with all of the recently implemented austerity measures the Spanish government is still not even close to a balanced budget. Meanwhile, the housing market in Spain is crashing and unemployment is already above 24 percent. The Spanish banking system is a giant, unregulated mess that is on the verge of a massive implosion, and the Spanish stock market has been declining rapidly. The Spanish government is going to need a massive bailout and so will the entire Spanish banking system. But that is going to be a huge problem, because the Spanish economy is almost 5 times as large as the Greek economy. When the Spanish financial system collapses, the entire globe is going to feel the pain and there will be no easy solution.
So just how bad are things in Spain at this point?
The following are 22 signs that the collapsing Spanish economy is heading into a great depression….
#1 The unemployment rate in Spain has reached 24.4 percent – a new all-time record high. Back in April 2007, the unemployment rate in Spain was only 7.9 percent.
#2 The unemployment rate in Spain is now higher than the U.S. unemployment rate was during any point during the Great Depression of the 1930s.
#3 According to CNBC, some analysts are projecting that the unemployment rate in Spain is going to go above 30 percent.
#4 The unemployment rate for those under the age of 25 in Spain is now a whopping 52 percent.
#5 There are more than 47 million people living in Spain today. Only about 17 million of them have jobs.
#16 Spanish housing prices are now down 25 percent from the peak of the housing market and Citibank’s Willem Buiter expects the eventual decline to be somewhere around 60 percent.
#17 It is being projected the the economy of Spain will shrink by 1.7 percent this year, although there are some analysts that feel that projection is way too optimistic.
#18 The Spanish government has announced a ban on all cash transactions larger than 2,500 euros.
#19 One key Spanish stock index has already fallen by more than 19 percent so far this year.
#20 The Spanish government recently admitted that its 2011 budget deficit was much larger than originally projected and that it probably will not meet its budget targets for 2012 either.
Spain is going down the exact same road that Greece went down.
Greece is already suffering through a great depression and now Spain is joining them. The following is from a recent BBC article….
“In Spain today, a cycle similar to Greece is starting to develop,” said HSBC chief economist Stephen King.
“The recession is so deep that when you take one step forward on austerity, it takes you two steps back.”
In Spain right now there is a lot of fear and panic about the economy. In many areas, it seems like absolutely nobody is hiring right now. The following is from a recent USA Today article….
“The situation is very bad. There’s no work,” said Enrique Sebastian, a 48-year-old unemployed surgery room assistant as he left one of Madrid’s unemployment offices. “The only future I see is one with wages of €400 ($530) a month for eight-hour days. And that’s if you can find it.”
But Spain is just at the beginning of a downward spiral. Just wait until they have been through a few years of economic depression. Once that happens, millions of people begin to lose all hope. A recent Reuters article discussed the epidemic of suicides that is happening in Greece right now….
On Monday, a 38-year-old geology lecturer hanged himself from a lamp post in Athens and on the same day a 35-year-old priest jumped to his death off his balcony in northern Greece. On Wednesday, a 23-year-old student shot himself in the head.
In a country that has had one of the lowest suicide rates in the world, a surge in the number of suicides in the wake of an economic crisis has shocked and gripped the Mediterranean nation – and its media – before a May 6 election.
And you know what?
The nightmares that we are seeing unfold in Spain and Greece right now are just a preview of what is coming to most of the rest of the world.
The next wave of the economic crisis will soon envelop the United States, Japan and the rest of Europe.
When it strikes, the pain will be immense.
But it won’t be the end – it will only be just the beginning.
The global financial system is starting to crumble.
No matter how often the pretty people on television tell us that the U.S. economy is getting better, it isn’t going to change the soul crushing agony that millions of American families are going through right now. The stock market may have gotten back to where it was in 2008, but the job market sure hasn’t. As I wrote about a few days ago, the percentage of working age Americans that are actually employed has stayed very flat since late 2009, and the average duration of unemployment is hovering near an all-time high. Sadly, this is not just a temporary downturn. The U.S. economy has been slowly declining for several decades and is nearing total system failure. Right now, many poverty statistics are higher than they have ever been since the Great Depression. Many measurements of government dependence are the highest that we have ever seen in all of U.S. history. The emerging one world economic system (otherwise known as “free trade”) has cost the U.S. economy tens of thousands of businesses, millions of jobs and hundreds of billions of dollars of our national wealth. The federal government is going into unprecedented amounts of debt in order to try to maintain our current standard of living, but there is no way that they will be able to sustain this kind of borrowing for too much longer. So enjoy this bubble of false prosperity while you can, because things will soon get significantly worse.
As the U.S. economy experiences total system failure, it will be imperative for all of us not to wait around waiting for someone to rescue us.
And I am not just talking about the government.
Today, millions upon millions of Americans are waiting around hoping that someone out there will hire them.
Well, the truth is that our politicians have made it so complicated and so expensive to hire someone that many small businesses try to avoid hiring as much as possible.
Businesses generally only want to hire people if they can make a profit by doing so. When our politicians keep piling on the taxes and the regulations and the paperwork, that creates a tremendous incentive not to hire workers.
Michael Fleischer, the President of Bogen Communications, once wrote an op-ed in the Wall Street Journal entitled “Why I’m Not Hiring”. The following is how Paul Hollrah of Family Security Matters summarized the nightmarish taxes that are imposed on his company when Fleischer hires a new worker….
According to Fleischer, Sally grosses $59,000 a year, which shrinks to less than $44,000 after taxes and other payroll deductions. The $15,311 deducted from Sally’s gross pay is comprised of New Jersey state income tax: $1,893; Social Security taxes: $3,661; state unemployment insurance: $126; disability insurance: $149; Medicare insurance: $856; federal withholding tax: $6,250; and her share of medical and dental insurance: $2,376. Roughly 25.9 percent of Sally’s income is siphoned off by Washington and Trenton before she receives her paychecks.
But then there are the additional costs of employing Sally. In addition to her gross salary, her employer must pay the lion’s share of her healthcare insurance premiums: $9,561; life and other insurance premiums: $153; federal unemployment insurance: $56; disability insurance: $149; worker’s comp insurance: $300; New Jersey state unemployment insurance: $505; Medicare insurance: $856; and the employer’s share of Social Security taxes: $3,661.
Over and above her gross salary, Bogen Communications must pay an additional $15,241 in benefits and state and federal taxes, bringing the total cost of employing Sally to approximately $74,241 per year. Sally gets to keep $43,689, or just 58.8% of that total.
Are you starting to understand why so many businesses are hesitant to hire new workers?
The big corporations can handle all of the paperwork and regulations that come with hiring a new worker fairly well, but for small businesses hiring a new worker can be a massive undertaking. That new worker is going to have to almost be a miracle worker in order to justify all of the hassle and expense.
But the federal government just keeps piling more burdens on to the backs of employers. That is one reason why there is such an uproar over Obamacare. It is going to make hiring workers even less attractive.
These days, most small businesses are trying to get by with as few workers as possible, and many big businesses are trying to ship as many jobs as they can overseas.
Sadly, even if you do find a good job it can disappear at any moment.
The following is from a comment that a reader named Jeff recently left on one of my articles….
It’s sad what’s happening here in this country. So many lucky ones defend it. In America it’s not exactly about hard work anymore, it’s about who you know always. The ability to keep people stupid as well as in debt was established here well by corporations also. You cannot start a solid hiring business like you could years ago.
I know many of folks who don’t break a sweat and earn more money than I ever will in a week. The system is getting crazy only creating two extremes. I fought for this country right after 9/11 as a young naive person. Using my grandfather’s old stories to see the dream that this country was always suppose to have.
The company I still unfortunately work for (cause other places are worse), 4 years ago they froze our salaries. No raises yet, this is when the company was bought by an investment group for 500 million.
Now we are getting sold to Japan for 1 billion. A 500 million dollar profit. Sorry if I may be ignorant in this way of business. But it seems the only one who benefited from this is that group of investors. 400+ well skilled jobs lost, no raises or rewards, a whole lot more work and contract obligations to meet, and less contact with management when problems surface.
I just think the United States of America is becoming the world’s poker table.
I want out of this country so bad. I don’t even know what happen to people here. The younger generation scares me how dumb they are and everyone seems so easily bought with eyecandy.
Can you imagine that?
Can you imagine your boss walking in one day and declaring that the business has just been sold to foreigners and that you are about to lose your job?
In America today, it can be absolutely soul crushing to lose a job. It isn’t as if you are going to run out and get another fantastic job in a week or two.
When you are unemployed, people look at your differently. It gets to the point where you don’t even want to interact with other people because you know that your unemployment is probably going to be the number one topic of conversation.
When you are out of work for six months or more, it is easy to feel like a failure – especially when so many other people are looking at you as if you are a failure too.
But in most cases, individual Americans are not to blame for not being able to find work.
Rather it is the entire system that is failing all of us.
The U.S. economy is bleeding good jobs and the middle class in America has become a bizarre game of musical chairs. When the music stops each round you might lose your spot. You just never know.
Looking for work in the United States in this economic environment can be a demoralizing endeavor. For example, a recent Esquire article described what one unemployed man named Scott Annechino found when he attended a job fair in San Francisco….
A glass elevator carries him to the third floor, where the front-desk girl, who knows it’s her job to be cheerful, told him the job fair is supposed to be.
A pasty kid, maybe thirty, in a too-big shirt and a cheap tie, greets him and tells him the companies are set up in rooms along the hall and that he should definitely visit all of them. Annechino, forty-four years old, wearing his best suit and shined black shoes, walks to the first exhibitor: Devcon, a home-security company. The door is closed, no one inside. Annechino looks around for an explanation. “Oh, I just got an e-mail from my contact there saying they wouldn’t be able to make it today,” the pasty kid says, fingering his BlackBerry.
A couple of other potential employers who were supposed to be here didn’t make it, either — Konica Minolta, Santa Clara University. “Yeah …” the kid says. Annechino moves to the next room. State Farm. They’re looking for people who can put up fifty grand to start their own insurance agency. The Art Institute is next, mostly looking for people who might want to go to art school. New York Life. The U. S. Army, where men wearing fatigues and combat boots offer brochures.
That’s it.
If you want to check out the rest of the sad unemployment stories in that article, you can find them right here.
But even if you do have a job, that doesn’t mean that everything is just fine. Average American families are finding that the prices of the basic things that they need are rising much faster than their paychecks are.
According to one recent study, more than half of all Americans feel as though they are really struggling to afford just the basics at this point….
“Every retailer wants to think ‘Everything I sell is worth it! Shoppers will love it’, but the hard reality is 52% Americans feel they barely have enough to afford the basics,” said Candace Corlett, president of WSL/Strategic Retail.
Just buying food and gas is a major financial ordeal for many families these days. On average, a gallon of gasoline in the United States now costs $3.83. Many Americans burn up a huge chunk of their paychecks just going back and forth to work in their cars.
So what is the solution?
Well, according to the Obama administration the answer is even more government dependence. The federal government is now actually running ads encouraging even more people to go on food stamps….
Can you believe that?
Apparently having 46.5 million Americans on food stamps is not enough. The federal government is spending our tax money on advertisements that try to convince even more Americans that they need to be on food stamps.
What the American people really need are good jobs, but those keep getting shipped out of the country.
For example one Colorado man was recently caught stealing parts from toilets in public restrooms….
Donald Allen Citron, 48, faces 18 charges, including burglary and theft. He’s accused of stealing toilet parts from several locations, including Southwest Plaza Mall, University of Denver, and Craig Hospital.
Most of the crimes happened in just a few minutes, but police Citron is a plumber and all he needed was a wrench and a screw driver to steal pipes and the plumbing in toilets. The items he’s accused of stealing are valued at around $6,400.
They are calling him “the crapper scrapper”.
Other Americans are not willing to stoop to crime and instead suffer quietly and anonymously.
A reader named Katie recently left the following heartbreaking comment on one of my articles….
I’m almost homeless. Through no fault of my own I’d like to point out. I don’t drink, smoke, or do drugs. I don’t even eat fast food unless I have too.
Four years ago I had a house, car, family, stuff, an IRA, and really everything that people in this country aspire to. I had a great job that I enjoyed so did my boyfriend. Even our relationship was great.
We didn’t get hit by the economy right away. We were in Katrina damaged parts of the country and there was still a lot of construction going on and the economic boom that comes with it.
Then I got laid off. Doesn’t seem to matter that I go to interview after interview. I use indeed, monster, craigslist, and newspapers to search for jobs even outside my area.
Now my boyfriend has passed away suddenly, and his family got everything. I personally have only a living father left, who hasn’t the room but I’m camping in his yard. All my friends say they don’t have the room either. Which makes me wonder just how much of friends they are. Considering if the situation was reversed I have in the past and would open my home to anyone that needed help.
If something happens to him I really don’t know what I’m going to do. I need to get on my feet and I know that jobs are hard to come by. I’m sick of the people who have jobs saying ‘get a job you lazy bum’. I’m hardly lazy and I’m trying desperately to be employed; not being homeless would be rather awesome in my opinion. I’m not picky, regardless of my degree I’ll pick up trash or clean toilets. McDonald’s, Taco Bell and the other fast food places don’t even bother with a call back. And when I call to inquire about my application it’s always the same, ‘we will call you when we make a decision’. Such a cop-out.
So no. In my (granted meaningless opinion) the economy is not getting better. To even suggest that when unemployment is so high or the rate of food stamps. Is utter ludicrous at best. I notice that those talking heads on the cable news and radio never seem to mention that the homeless shelters have a higher occupancy level than ever before. Nor would they mention the fact that we have those shelters in abundance now across the country in comparison to the Great Depression.
I’m getting real tired of hearing how great the economy is doing. When obviously it’s not. All you have to do is open your eyes and see. Business are not coming back yet and foreclosed homes sit empty everywhere. The unemployment rate only counts the people who are getting unemployment benefits. So the people who fall off the unemployment benefits don’t get counted. Because the must have gotten a job, right? Hardly. In fact the homeless in this country are almost never counted correctly. It’s too hard to count them all, or at least that’s the excuse.
I know it’s meaningless, especially to those who see homeless and immediately have a bias, but that’s my opinion on the current state of our economy. You can count me in the 80%. Only a fool would see this as a recovery.
Please say a prayer for Katie and the millions of other Americans just like her. It can be absolutely soul crushing to lose everything that you ever worked for and not see any light at the end of the tunnel.
Unfortunately, the U.S. economy is not going to be improving in the long run. What we are experiencing right now is about as good as it is going to get. The truth is that it is pretty much downhill from here.
It is fairly simple to figure out what is happening to us as a nation.
You can’t keep buying far more than you sell.
You can’t keep spending far more than you bring in.
You can’t keep running up debt in larger and larger amounts indefinitely.
The U.S. economy is running on borrowed money and on borrowed time.
Are you better off today than you were four years ago? If not, then you are just like most other Americans. According to a CBS News/New York Times poll that was released a few days ago, 80 percent of Americans say that their financial situation is not “better today” than it was four years ago. But if you turn on the television and listen to what the “pundits” are saying, you would be tempted to think that we were in the midst of a robust economic recovery. You would be tempted to think that the U.S. economy is in great shape and that we are heading for a really bright future. But the fact that the stock market is soaring does not mean much to most Americans. In fact, most Americans couldn’t care less that the Dow is well above 13,000 and that the NASDAQ is above 3,000. What most Americans care about is having a job and being able to provide for their families. If you haven’t paid the mortgage in three months or if you don’t have enough money to take your daughter to go see the doctor it really is not going to matter to you how well the boys and girls over on Wall Street are doing. Right now most American families are doing worse than they were doing four years ago, and no amount of media hype is going to change that fact.
Yes, the stock market is doing really well for the moment, but the truth is that more than 50 percent of all stocks and bonds are owned by just 1 percent of the U.S. population.
Good for them. It looks like the trillions of dollars that the Federal Reserve poured into the big Wall Street banks is really paying off nicely for the financial community.
Meanwhile, much of the rest of the country is deeply suffering.
It was recently reported that 1.5 million American families live on less than two dollars a day (before counting government benefits).
That is horrifying.
According to the U.S. Census Bureau, the percentage of Americans living in “extreme poverty” is now sitting at an all-time high.
All across this country poverty is exploding. Food banks are experiencing more demand than ever before and those offering free healthcare are absolutely swamped.
And every single measure of government dependence has gone way up since Barack Obama entered the White House.
For example, since Barack Obama became president the number of Americans on food stamps has gone up by 45 percent.
Just think about that.
At this point the federal government is helping to feed an all-time record 46.5 million Americans every month.
Oh yeah, times are good.
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.
That is much higher than it has been historically.
For example, back in 1983 less than a third of all Americans lived in a home that received direct monetary benefits from the federal government.
The big problem is that there are simply not enough jobs for everyone.
Listening to the media, you would be tempted to think that the U.S. economy is now pumping out huge numbers of good jobs.
But that is simply not the case.
Right now there are 5.6 million fewer jobs than there were when the last recession began back in late 2007.
So where are the millions of jobs you promised us Obama?
The federal government is trying to convince us that the unemployment rate is going down, but that is not really true.
The key is to look at the percentage of working age Americans that actually have jobs. During the last recession that percentage fell dramatically as you can see from the chart below. After every other recession since World War II the employment to population ratio has always bounced back. But it has not happened this time. Instead, the employment to population ratio has remained between 58 and 59 percent since the end of 2009….
We have not had a jobs recovery. Hopefully we will have one before the next recession hits, but we are running out of time for that.
Tonight there are millions upon millions of hard working Americans that are staring at their television screens and wondering why they can’t find good jobs. The pretty people on television are telling them that the employment situation is getting much better but they can’t find work no matter how hard they try. It is a cruel joke on them.
When Barack Obama entered the White House, 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.
Thanks for the improvement Obama.
Meanwhile, the average duration of unemployment continues to hover near a record high. Just look at the chart posted below. Does this look like a “jobs recovery” to you?….
But of course Obama and those that support him want to make things sound like they are getting better. They want people to run out and vote for him again in November.
If things are going well for you right now, be thankful, and also remember the millions upon millions of Americans out there that are deeply hurting in this economy.
If you gathered together all of the workers that are “officially” unemployed in the United States at this point into one nation, they would constitute the 68th largest country in the entire world. It would be a nation larger than Greece or Portugal.
That is a lot of people.
Obama promised us that the Wall Street bailouts would make everything better. He promised us that if we poured gigantic mountains of money into Wall Street that it would end up helping “Main Street”.
Well, the last time I looked Goldman Sachs was doing just fine.
How much wealthier do they have to get before they start creating more jobs for the rest of us?
Obama (like most of our politicians) is a complete fraud when it comes to the economy. He is all saddle and no horse. He talks a good game but he doesn’t have any game.
As Wall Street has recovered, the rest of the country has actually been in decline. Median household income in the United States is down 7.8 percent since December 2007 after adjusting for inflation. Millions of American families are reaching the breaking point and millions of other families have already reached it.
Incomes have been declining but the cost of living has not.
For example, health insurance costs have risen by 23 percent since Barack Obama became president.
Has your paycheck increased by 23 percent?
The average price of a gallon of gasoline in the United States has increased by more than 90 percent since Barack Obama became president.
Has your paycheck increased by 90 percent?
Millions of American families have lost their homes while Obama has been president and millions more will soon lose their homes. At this point there are more than 6 million mortgages in the United States that are overdue.
It is a horrible, horrible feeling to know that you can’t pay your mortgage and that you will soon lose your home and your family will be put out on the street.
None of us would ever want to end up in that situation.
And the housing market sure has not shown any signs of recovery under Barack Obama.
In January, U.S. home prices were the lowest that they have been in more than a decade.
Weren’t home prices and home sales supposed to be turning around by now?
Under Barack Obama, new home sales in the United States set a brand new all-time record low in 2009, they set a brand new all-time record low again in 2010, and they set a brand new all-time record low once again during 2011.
That trend is not going in the right direction.
Of course Barack Obama is not solely responsible for the performance of the U.S. economy. Congress should share part of the blame as well, and the Federal Reserve is more responsible for our economic performance than anyone else is.
But one area where Barack Obama has had a huge impact is in the area of government spending.
While Barack Obama has been president, the U.S. national debt has risen from 10.6 trillion to 15.5 trillion.
Thanks Obama.
During the first three years of the Obama administration, the U.S. government has accumulated more debt than it did between 1776 and 1995.
So is Obama planning a change of course?
Of course not.
At this point, our national debt is increasing by about 150 million dollars every single hour.
So should we be thanking Obama for stealing 150 million dollars from our children and our grandchildren every hour?
Should we be thanking Obama for ruining our future?
I think not.
But you know what?
According to the CBS News/New York Times poll mentioned above, about half of America would actually vote for Obama if the next presidential election was held today.
That alone is a clear sign that this country is in a massive amount of trouble.
The truth is that the leaders we elect are an accurate reflection of who we are as a country.
And when you look at the collection of misfits in Washington D.C. right now, that does not say a lot about the character of this nation.
We live in a world that is becoming increasingly unstable, and the potential for an event that could cause “sudden change” to the U.S. economy is greater than ever. There are dozens of potentially massive threats that could easily push the U.S. economy over the edge during the next 12 months. A war in the Middle East, a financial collapse in Europe, a major derivatives crisis or a horrific natural disaster could all change our economic situation very rapidly. Most of the time I write about the long-term economic trends that are slowly but surely ripping the U.S. economy to pieces, but the truth is that just a single really bad “black swan event” over the next 12 months could accelerate our economic problems dramatically. If oil was cut off from the Middle East or a really bad natural disaster suddenly destroyed a major U.S. city, the U.S. economy would be thrown into a state of chaos. Considering how bad the U.S. economy is currently performing, it would be easy to see how a major “shock to the system” could push us into the “next Great Depression” very easily. Let us hope that none of these things actually happen over the next 12 months, but let us also understand that we live in a world that has become extremely chaotic and extremely unstable.
In the list below, you will find some “sudden change” events that are somewhat likely and some that are quite unlikely. I have tried to include a broad range of potential “black swan events”, but there are certainly dozens more massive threats that could potentially be listed.
The following are 15 potentially massive threats to the U.S. economy over the next 12 months….
#1 War With Syria – U.S. Senator John McCain is now publicly calling for U.S. airstrikes against Syria. A military conflict with Syria becomes more likely with each passing day.
#2 War With Iran – A war in the Middle East involving Iran could literally erupt at any time. The following is from a Reuters news report that was issued on Monday….
President Barack Obama appealed to Benjamin Netanyahu on Monday to give sanctions time to curb Iran’s nuclear ambitions, but the Israeli prime minister offered no sign of backing away from possible military action, saying his country must be the “master of its fate.”
#3 A Disorderly Greek Debt Default – Many reporters in Europe seem to think that this is becoming increasingly likely. So what would a disorderly Greek debt default mean for the global financial system? A leaked report that was authored by the Institute of International Finance says that a disorderly Greek debt default would have some very serious consequences. You can read the full text of that leaked report right here.
#4 An Economic Collapse In Spain – Spain has one of the largest economies in Europe and it is rapidly becoming a basket case. As I have written about previously, the unemployment rate in Spain has hit 19.9 percent, and the unemployment rate for workers under the age of 25 is up to 49.9 percent. Unfortunately, the situation in Spain continues to deteriorate. The following is from a recent article by Marc Chandler….
However, the devolution in Spain is particularly troubling. The new fiscal compact had just been signed last week, which includes somewhat more rigorous fiscal rule and enforcement, when Spain’s PM Rajoy revealed that this year’s deficit would come in around 5.8 percent of GDP rather the 4.4 percent target. This of course follows last year’s 8.5 percent overshoot of the 6 percent target.
The problem that for Spain is that the 4.4 percent target was based on forecasts for more than 2 percent growth this year. However, in late February, the EU cuts its forecast to a 1 percent contraction. This still seems optimistic. The IMF forecasts a 1.7 percent contraction, which the Spanish government now accepts.
#5 The Price Of Gasoline – The average price of a gallon of gasoline in the United States has risen for 27 days in a row and is now up to $3.77. Virtually all forms of economic activity are affected by the price of gasoline, and if the price of gas keeps going up it is eventually going to have dramatic consequences for the U.S. economy.
#6 The Student Loan Debt Bubble – Just like we saw with the housing bubble, the student loan debt bubble just continues to grow and grow and grow. At some point the nearly 1 trillion dollar bubble is going to burst. What effect will it have on our financial system when that finally happens?
#7 State And Local Government Debt Crisis – It is being reported that California is running out of cash again and there are cities all over the country that are on the verge of bankruptcy. Could we see a significant municipal bond crisis in the next 12 months?
#8 The Collapse Of A Major U.S. Bank – A number of top U.S. banks are looking increasingly shaky. In a recent article, David Trainer explained why he has such serious concerns about Bank of America right now….
In my opinion, there are four actions taken by financial services that signal the company is headed to serious trouble.
1. Management shake-up and major layoffs – lots of layoffs over the past year
2. Exploiting accounting rules to boost earnings – SFAS 159
3. Drawing down reserves to boost earnings: to the tune of $13.3 billion in 2011 and 2012
4. Bilking customers with new fees: tried it before and trying it again
Bank of America has taken all four steps.
#9 A Derivatives Crisis – The International Swaps and Derivatives Association recently ruled that the Greek debt deal will not trigger payouts on credit default swaps. This is seriously shaking confidence in the global market for derivatives. But the global financial system simply cannot afford a major derivatives crisis.
Estimates of the notional value of the worldwide derivatives market range from $600 trillion all the way up to $1.5 quadrillion. The notional value of all derivatives held by Bank of America is approximately $75 trillion. JPMorgan Chase is holding derivatives with a notional value of approximately $79 trillion.
When the derivatives bubble finally bursts it is going to be a financial horror show unlike anything we have ever seen.
#10 The Fall Of The Japanese Economy – The Japanese economy shrank at a 2.3 percent rate during the fourth quarter of 2011. Japan has a debt to GDP ratio of over 200 percent and a major debt crisis involving Japan could erupt at any time.
#11 A “Solar Megastorm” – Scientists tell us that there is a “1 in 8 chance” that a “solar megastorm” will hit the earth by 2014. A recent Daily Mail article detailed what some of the consequences of such an event would be….
‘We live in a cyber cocoon enveloping the Earth. Imagine what the consequences might be,’ Daniel Baker, of the University of Colorado’s Laboratory for Atmospheric and Space Physics told National Geographic when asked about a potential ‘megastorm’.
‘Every time you purchase a gallon of gas with your credit card, that’s a satellite transaction.
‘Imagine large cities without power for a week, a month, or a year. The losses could be $1 to $2 trillion, and the effects could be felt for years.
#12 A Major West Coast Earthquake Or Volcanic Eruption – On Monday, there was a 4.0 earthquake in San Francisco and a 6.1 earthquake in Argentina. Is the “Ring of Fire” waking up again?
#13 Tornado Damage To Major U.S. Cities – Last year, the U.S. experienced one of the worst tornado seasons of all time. This year, we have already seen the worst tornado outbreak ever recorded in the United States in the month of March. A couple of towns in Indiana were completely wiped out by that outbreak. So what should we expect when we get to the heart of tornado season this year?
#14 Severe Drought In The United States – Last summer was one of the driest summers on record in the United States, and in many areas there is simply not enough water available for farmers this year. Some are even projecting that we could see “dust bowl conditions” return to some areas of the country eventually.
#15 An Asteroid Strike In 2013 – Although scientists tell us that the probability is extremely low, the truth is that there is a slight chance that a sizeable asteroid could hit the earth in February 2013. The asteroid is estimated to be between 60 and 100 meters wide, and it is projected to pass by our planet “at a distance of under 27,000 km“. If it did hit us (and scientists say that the odds of that happening are very low) it would potentially be as serious an event as the Tunguska Event in Siberia in 1908. Mac Slavo of shtfplan.com recently described how awesome the Tunguska Event really was….
On June 30, 1908 an incoming meteor exploded approximately 5 miles above Siberia. The force of the air burst explosion, estimated at between 15 and 30 megatons, or about 1000 times bigger than the atomic bomb that destroyed Hiroshima, was so powerful that it annihilated everything in an 830 square mile area, and reports suggest that that explosion was heard up to 1000 miles away. Because of the remoteness of the impact zone, the Tunguska Event over Siberia had very little effect on the human population in the region, but the destruction of some 80 million trees in the area shows just how powerful a blast was created.
Of course there are so many other “sudden change” events that could potentially happen – a terror event in a major U.S. city, a deadly pandemic, an EMP attack, cyberterrorism or a major political scandal could all possibly cause a stock market crash and an economic collapse in the United States.
In the world that we are living in today, you just never know what is going to happen.
So what are all of you concerned about over the next 12 months?
Do you see the potential for some “black swan events” to happen?
Please feel free to post a comment with your thoughts below….
Another month, another bad jobs report. For the month of May, the U.S. economy only added 69,000 jobs and the unemployment rate rose to 8.2%. Many are calling this a total “disaster” and are worried that the U.S. economy could be headed back into another recession. Economists had been expecting 150,000 payroll jobs would be added, so the 69,000 number really shocked a lot of people. The truth is that the economy needs to add approximately 125,000 new jobs every single month just to keep the unemployment rate steady. So yes, this bad jobs report is not welcome news at all – especially for the Obama administration. When Barack Obama first took office the unemployment rate was sitting at 7.6 percent and now it is sitting at 8.2 percent. Some “recovery”, eh? But the reality is that this jobs report was really not that “devastating” even though the stock market had its worst day of the year. Unemployment in America is still about at the same level as it was back at the beginning of 2012. The tough stretch that we are going through right now is only a very small taste of the economic nightmare that is on the horizon. If you think that things are a “disaster” right now, just wait until you see what is coming.
10 Things That We Can Learn About Shortages And Preparation From The Economic Collapse In Greece
The following are 10 things that we can learn about shortages and preparation from the economic collapse in Greece….
#1 Food Shortages Can Actually Happen
Most people assume that they will always be able to run out to their local supermarket or to Wal-Mart and get all of the supplies they need.
Unfortunately, that is a false assumption. The truth is that our food distribution system is extremely vulnerable.
In Greece, many people are starting to totally run out of food. Even some government institutions (such as prisons) are now reporting food shortages. The following was originally from a Greek news source….
#2 Medicine Is One Of The First Things That Becomes Scarce During An Economic Collapse
If you are dependent on medicine in order to survive, you might want to figure out how you are going to get by if your supply of medicine is totally cut off someday.
In Greece, medicine shortages have become a massive problem. The following is from a recent Bloomberg article….
#3 When An Economy Collapses, So Might The Power Grid
Try this some time – turn off all power to your home for 24 hours and try to live normally.
Sadly, most people simply do not understand just how dependent we are on the power grid. Without power, all of our lives would change dramatically.
In Greece, authorities are warning of an impending “collapse” of the power grid. If it goes down for an extended period of time in Greece, the consequences would be catastrophic….
#4 During An Economic Collapse You Cannot Even Take Water For Granted
If the power grid goes down, you will soon no longer have clean water coming out of your faucets. That is one of the reasons why it is absolutely imperative that the power grid stay operable in Greece.
Sadly, most people don’t understand just how vulnerable our water system is. In a previous article, I quoted from a report that discussed how rapidly our water supply would be in jeopardy in the event of a major transportation disruption….
What will you do when clean water stops coming out of your faucets?
You might want to start thinking about that.
#5 During An Economic Crisis Your Credit Cards And Debit Cards May Stop Working
Most people have become very accustomed to using either debit cards or credit cards for almost everything.
But what would happen if the financial system locked up for a period of time and you were not able to use them?
This is something that the citizens of Greece are potentially facing in the coming months, and this is something that all of us need to start thinking about.
#6 Crime, Rioting And Looting Become Commonplace During An Economic Collapse
Big corporations are already making extensive plans for how to protect their stores in the event that Greece switches from the euro to the drachma.
The following is from a recent Reuters article….
#7 During A Financial Meltdown Many Average Citizens Will Start Bartering
During this economic depression, alternative currencies have already been popping up in Greece.
When things fall apart on a global scale, will you have things to barter for the things that you need?
#8 Suicides Spike During An Economic Collapse
When you think of the Great Depression of the 1930s, what do you think of?
Many people think of images of people jumping out of buildings.
Well, something similar has been happening in Greece. Suicide statistics in Greece have been absolutely soaring during the last couple of years.
Once prosperity disappears, many people feel as though life is not worth living anymore.
#9 Your Currency May Rapidly Lose Value During An Economic Crisis
Just remember what happened in Germany during the Weimar Republic and what has happened recently in places like Zimbabwe.
The truth is that it can happen anywhere.
Right now, Greeks are pulling their money out of the banks because they are worried that their euros will be turned into drachmas which would rapidly lose value.
If I was living in Greece I would definitely be concerned about that. The return of the drachma seems to get closer with each passing day. Just check out these screenshots.
#10 When Things Hit The Fan The Government Will Not Save You
Has the government of Greece come to the rescue of all of those that are deeply suffering right now?
Of course not. The truth is that the Greek government can barely take care of itself at the moment.
History has shown us that governments simply cannot be counted on when things hit the fan.
Just remember what happened during the aftermath of Hurricane Katrina.
In the end, the only one that can be counted on to take care of you and your family is you.
So you better start preparing.
Unfortunately, as I wrote about the other day, time is rapidly running out for the global financial system.
Even some of the top economic officials in the world are warning that another major crisis could be on the way.
Just check out what World Bank President Robert Zoellick said the other day….
He also compared a potential exit of Greece from the eurozone to the collapse of Lehman Brothers back during the last financial crisis….
So what are some things that the average person can do to get prepared?
Well, a recent article on SHTFplan.com entitled “The List: A to Z Survival for the Abysmal Times Ahead” contains hundreds of ideas for preparing for the chaotic economic environment that we are heading into.
Preparation is going to look different for every family. No two situations are exactly the same.
But there are some practical steps that nearly all of us can take to better position ourselves for what is coming. Now is the time to get educated and now is the time to take action.
Or you could be like all of those that laughed at Noah while he was building that big boat.
In the end, things did not work out too well for those folks.