If enough people truly believe that things will get better, will that actually cause them to get better? There is certainly something to be said for being positive and thinking that anything is possible. And as Americans, optimism seems to come naturally for us. However, no amount of positive thinking is ever going to turn the sun into a block of wood or turn the moon into a block of cheese. Any good counselor will tell you that one of the first steps toward recovery is to stop being delusional and to come to grips with how bad things really are. When we deny reality and engage in irrational wishful thinking, we are engaging in something called “hopium”. This is a difficult term to define, but the favorite definition of hopium that I have come across so far goes like this: “The irrational belief that, despite all evidence to the contrary, things will turn out for the best.” In hundreds of articles, I have documented how the U.S. economy is mired in a long-term decline which is about to get a lot worse. But most Americans see things very differently. In fact, according to a brand new CNN/ORC poll, 52 percent of Americans describe the U.S. economy as “very” or “somewhat good”, and more than two-thirds of all Americans believe that the U.S. economy will be in “good shape” a year from right now. But if you asked most of those people why they are so optimistic, they would probably mumble something about “Obama” or about how “we’re Americans and we always bounce back” or some other such gibberish. Well, it’s wonderful that so many people are feeling good and looking forward to the future, but are those beliefs rational?
We witnessed a perfect example of this “hopium” on Wednesday. Sales at McDonald’s restaurants have been in decline for quite a while, and the numbers for the first quarter of 2015 were just abysmal…
The ubiquitous burger-and-fries chain said US sales, the largest share of global income, fell 2.6 percent from a year ago for comparable outlets.
Sales in the Asia-Pacific and Middle East region dropped 8.3 percent, helping bring overall global sales down 2.3 percent, “reflecting negative guest traffic in all segments,” the company said.
Total revenue sank 11 percent to $5.96 billion in the quarter to March 31, and net income plunged 32.6 percent to $812 million, or 84 cents a share (-31 percent).
So you would think that the stock price would have tanked on Wednesday, right?
Thanks to news that a “turnaround plan” would be announced on May 4th, McDonald’s stock actually skyrocketed…
McDonald’s closed up 3.13 percent after spiking more than 4.5 percent in early trade as investors cheered a turnaround plan expected on May 4. However, the fast food chain’s earnings missed on both the top and bottom lines.
This is pure hopium. Why don’t McDonald’s executives just tell us what the plan is now? But instead, the mystery of a “secret turnaround plan” gives people just enough hope to keep the stock from tumbling – at least for the moment.
And of course there are all sorts of other stocks that are being massively inflated by hopium right now.
Many years ago, when I was an undergraduate, I was taught that a price to earnings ratio of more than 20 was really, really high.
But these days that is the norm on Wall Street, and at the moment there are quite a few stocks that actually have price to earnings ratios that are greater than 100…
There are 10 stocks in the Standard & Poor’s 500, including industrial giant General Electric, video-streamer Netflix and oil and gas explorer Cabot Oil & Gas that are trading for 100 times their diluted earnings the past 12 months excluding extraordinary items, according to a USA TODAY analysis of data from S&P Capital IQ.
And if you can believe it, General Electric has a PE on its training earnings of more than 200…
Take General Electric, the industrial giant that’s swiftly selling off banking assets so it can return to its manufacturing roots. GE sports a PE on its trailing earnings of 227, says S&P Capital IQ.
This is completely and totally irrational. General Electric is a giant mess and is being very badly mismanaged. But investors continue to pay a massive premium for GE stock because they hope that things will turn around eventually.
Look, hope will get you a lot of things in life, but it won’t put money in your pockets or dinner on the table.
Our politicians and the mainstream media continue to sell us hard on the idea that things are getting better in America, but meanwhile our economic infrastructure continues to decay. Just check out what is happening in the steel industry…
United States Steel Corporation issued layoff notices to 1,404 workers in the latest sign of struggle for the American steel industry. The missives went out in recent days to workers producing pipe and tube products that are used in the oil and gas sector. Job cuts could come as early as June for 17 to 579 employees at a plant in Lone Star, Texas, 166 at a factory in Houston, 255 at a mill in Pine Bluff, Arkansas, and 404 managers across the company’s tubular operations nationwide.
Since last June, the company has informed 7,800 employees of potential job cuts, a tally from Pittsburgh Business Times indicated. U.S. Steel spokeswoman Sarah Cassella said the ongoing layoffs are the result of “challenging market conditions and global influences in the market including a high level of imports, reduced prices for oil and natural gas and reduced steel prices.”
Unfortunately, most Americans have no idea what is going on out there. Most of them get their news from the giant propaganda matrix that very tightly controls the flow of ideas and information in this country. This is something that I explain on my new DVD. Six colossal corporations control over 90 percent of the news, information and entertainment that Americans consume, and that gives them an awesome amount of power.
And right now that propaganda matrix is assuring the American people that everything is going to be just fine.
Well, they better be right. Because if not, they are going to have millions of people extremely angry with them when things really start falling to pieces.
Our entire way of life can be ended in a single day. And it wouldn’t even take a nuclear war to do it. All it would take for a rogue nation or terror organization to bring us to our knees is the explosion of a couple well-placed nuclear devices high up in our atmosphere. The resulting electromagnetic pulses would fry electronics from coast to coast. Of course this could also be accomplished without any attack. Scientists tell us that massive solar storms have hit our planet before, and that it is inevitable that there will be more in the future. As you will read about below, the most recent example of this was “the Carrington Event” in 1859. If a similar burst from the sun hit us today, experts tell us that life in America could suddenly resemble life in the 1800s, and the economic damage caused could potentially be in the trillions of dollars. This is one of the greatest potential threats that we are facing as a nation, and yet Barack Obama has essentially done nothing to get us prepared.
The technology necessary to conduct such an electromagnetic pulse attack against the United States has become much more accessible in recent years. According to an article in the Wall Street Journal, even rogue nations such as North Korea and Iran either already have or will soon have the capability to hurt us in this way…
Rogue nations such as North Korea (and possibly Iran) will soon match Russia and China and have the primary ingredients for an EMP attack: simple ballistic missiles such as Scuds that could be launched from a freighter near our shores; space-launch vehicles able to loft low-earth-orbit satellites; and simple low-yield nuclear weapons that can generate gamma rays and fireballs.
What would a successful EMP attack look like? The EMP Commission, in 2008, estimated that within 12 months of a nationwide blackout, up to 90% of the U.S. population could possibly perish from starvation, disease and societal breakdown.
In 2009 the congressional Commission on the Strategic Posture of the United States, whose co-chairmen were former Secretaries of Defense William Perry and James Schlesinger, concurred with the findings of the EMP Commission and urged immediate action to protect the electric grid. Studies by the National Academy of Sciences, the Department of Energy, the Federal Energy Regulatory Commission and the National Intelligence Council reached similar conclusions.
If you are a terrorist, a dictator or a fanatic that is looking for a “killshot” for the United States, those kinds of numbers would certainly get your attention.
And it was recently reported by WND that the Iranian military has already been playing around with such a scenario…
Peter Vincent Pry, who is executive director of a congressional advisory group called the Task Force on National and Homeland Security, raised the alarm as the agreement is about to be finalized.
He said U.S. military officials have confirmed such an Iranian plan.
“Iranian military documents describe such a scenario – including a recently translated Iranian military textbook that endorses nuclear EMP attack against the United States,” Pry wrote in a recent column in Israel’s main online media network, Aruz Sheva.
“Iran with a small number of nuclear missiles can by EMP attack threaten the existence of modernity and be the death knell of Western principles of international law, humanism and freedom,” he said.
Very chilling stuff.
And of course there are many, many others out there that would love to see the U.S. taken down other than just the Iranians.
Meanwhile, our power grid is far more vulnerable than most Americans would dare to imagine.
In previous articles, I discussed a recent Federal Energy Regulatory Commission report which stated the following…
“Destroy nine interconnection substations and a transformer manufacturer and the entire United States grid would be down for at least 18 months, probably longer.”
Are you starting to get the picture?
Our entire way of life depends upon electricity. If you take away that electricity, our society is transformed literally overnight.
A successful EMP would be an utter nightmare for this nation. Just consider what U.S. Representative Scott Perry had to say about a potential attack last year…
“The consequences of such an attack could be catastrophic; all electronics, power systems, and information systems could be shut down,” Rep. Scott Perry said in prepared remarks during an EMP hearing in May held by the U.S. House Committee on Homeland Security. “This could then cascade into interdependent infrastructures such as water, gas, and telecommunications. While we understand this is an extreme case, we must always be prepared in case a rogue state decides to utilize this technology.”
In essence, suddenly nothing would work and just about everything that we take for granted would suddenly be gone.
-There would be no heat for your home.
-Water would no longer be pumped into most homes.
-Your computer would not work.
-There would be no Internet.
-Your phones would not work.
-There would be no television.
-There would be no radio.
-ATM machines would be shut down.
-There would be no banking.
-Your debit cards and credit cards would not work.
-Without electricity, most gas stations would not be functioning.
-Most people would be unable to do their jobs without electricity and employment would collapse.
-Commerce would be brought to a standstill.
-Hospitals would not be able to function normally.
-You would quickly start running out of medicine.
-All refrigeration would shut down and frozen foods in our homes and supermarkets would start to go bad.
And as I mentioned above, all of this can happen even without an attack.
A direct hit from a major solar storm can cause the exact same thing.
NASA is warning that there’s a 12 percent chance an extreme solar storm will hit Earth in the next decade, sending out massive shock waves that would knock out grids across the world.
The economic impact of this doomsday scenario could exceed $2 trillion — or 20 times the cost of Hurricane Katrina, according to the National Academy of Sciences.
In recent years, we have been really lucky.
There was a close call in 2012 and another one in 2013.
The following is an excerpt from an upcoming book that I have co-authored with Barbara Fix that will soon be published entitled “Get Prepared Now”…
Most people have absolutely no idea that the Earth barely missed being fried by a massive EMP burst from the sun in 2012 and in 2013. And earlier in 2014 there was another huge solar storm which would have caused tremendous damage if it had been directed at our planet. If any of those storms would have directly hit us, the result would have been catastrophic. Electrical transformers would have burst into flames, power grids would have gone down and much of our technology would have been fried. In essence, life as we know it would have ceased to exist – at least for a time. These kinds of solar storms have hit the Earth many times before, and experts tell us that it is inevitable that it will happen again. The most famous one happened in 1859, and was known as the Carrington Event. But other than the telegraph, humanity had very little dependence on technology at the time. If another Carrington Event happened today, it would be a complete and utter nightmare. A study by Lloyd’s of London has concluded that it would have taken a $2,600,000,000,000 chunk out of the global economy, and it would take up to a decade to repair the damage. Unfortunately, scientists insist that it is going to happen at some point. The only question is when.
So keep an eye on the sun.
The giant ball of fire that we revolve around has started to behave very erratically, and it has the power to end our way of life at any time.
In fact, scientists tell us that we are about to get hit with a “glancing blow” on April 7th…
A filament of magnetism stretching halfway across the sun erupted during the late hours of April 4th (22:00-23:00 UT). The eruption split the sun’s atmosphere, hurling a CME into space and creating a “canyon of fire,” shown in a movie recorded by the Solar Dynamics Observatory: The glowing walls of the canyon trace the original channel where the filament was suspended by magnetic forces above the sun’s surface. From end to end, the structure stretches more than 300,000 km–a real Grand Canyon.
Fragments of the exploding filament formed the core of a CME that raced away from the sun at approximately 900 km/s (2 million mph): image. Most of the CME will miss Earth, but not all. The cloud is expected to deliver a a glancing blow to our planet’s magnetic field could on April 7th. High-latitude sky watchers should be alert for auroras.
The event of April 7th is not going to cause us major problems. But someday there will be a solar storm that will.
Personally, I cannot even imagine what life would be like without electricity.
Because we have become so deeply dependent on technology, most of us would have absolutely no idea how to live without it.
An electromagnetic pulse attack would be one of the fastest ways to cripple America and end the dominance of the United States in world affairs. And in this day and age, there are hundreds of millions of people around the planet that would love to see that happen.
So to not take steps to protect our power grid from such an attack is very foolish. But that is precisely what Barack Obama (and presidents before him) have chosen to do. We have technology which would mitigate the damage from an electromagnetic pulse, but rather than spend the money Obama has decided to just hope that it will never happen.
Can you imagine a world where your home, your vehicles, your appliances and every single electronic device that you own is constantly connected to the Internet? This is not some grand vision that is being planned for some day in the future. This is something that is being systematically implemented right now. In 2015, we already have “smart homes”, vehicles that talk to one another, refrigerators that are connected to the Internet, and televisions that spy on us. Our world is becoming increasingly interconnected, and that opens up some wonderful possibilities. But there is also a downside. What if we rapidly reach a point where one must be connected to the Internet in order to function in society? Will there come a day when we can’t even do basic things such as buy, sell, get a job or open a bank account without it? And what about the potential for government abuse? Could an “Internet of Things” create a dystopian nightmare where everyone and everything will be constantly monitored and tracked by the government? That is something to think about.
Today, the Internet has become such an integral part of our lives that it is hard to remember how we ever survived without it. And with each passing year, the number of devices connected to the Internet continues to grow at an exponential rate. If you have never heard of the “Internet of Things” before, here is a little bit about it from Wikipedia…
Things, in the IoT, can refer to a wide variety of devices such as heart monitoring implants, biochip transponders on farm animals, electric clams in coastal waters, automobiles with built-in sensors, or field operation devices that assist fire-fighters in search and rescue. These devices collect useful data with the help of various existing technologies and then autonomously flow the data between other devices. Current market examples include smart thermostat systems and washer/dryers that utilize wifi for remote monitoring.
But there is also a dark side to the Internet of Things. Security is a huge issue, and when that security is compromised the consequences can be absolutely horrifying. Just consider the following example…
It is a strange series of events that link two Armenian software engineers; a Shenzen, China-based webcam company; two sets of new parents in the U.S.; and an unknown creep who likes to hack baby monitors to yell obscenities at children. “Wake up, you little ****,” the hacker screamed at the top of his digital lungs last summer when a two-year-old in Houston wouldn’t stir; she happened to be deaf. A year later, a baby monitor hacker struck again yelling obscenities at a 10-month-old in Ohio.
Both families were using an Internet-connected baby monitor made by China-based Foscam. The hacker took advantage of a weakness in the camera’s software design that U.S.-based Armenian computer engineers revealed at a security conference in Amsterdam last April.
The Internet allows us to reach into the outside world from inside our homes, but it also allows the reverse to take place as well.
Do we really want to make ourselves that vulnerable?
Sadly, we live at a time when people don’t really stop to consider the downside to our exploding technological capabilities.
In fact, there are many people that are extremely eager to connect themselves to the Internet of Things.
In Sweden, there are dozens of people that have willingly had microchips implanted under the skin. They call themselves “bio-hackers”, and they embrace what they see as the coming merger between humanity and technology. The following is what one of the founders of a Sweden based bio-hacking community had to say during one recent interview…
“The technology is already happening,” says Hannes Sjoblad, one of the founders of BioNyfiken. “We are seeing a fast-growing community of people experimenting with chip implants, which allow users to quickly and easily perform a variety of everyday tasks, such as allowing access to buildings, unlocking personal devices without PIN codes and enabling read access to various types of stored data.
“I consider the take-off of this technology as another important interface-moment in the history of human-computer interaction, similar to the launches of the first windows desktop or the first touch screen. Identification by touch is innate for humans. PIN codes and passwords are not natural. And every additional device that we have to carry around to identify ourselves, be it a key fob or a swipe card, is just another item that clutters our lives.”
And of course this is happening in the United States as well…
In America, a dedicated amateur community — the “biohackers” or “grinders” — has been experimenting with implantable technology for several years. Amal Graafstra, a 38-year-old programmer and self-styled “adventure technologist”, has been inserting various types of radio-frequency identification (RFID) chips into the soft flesh between his thumbs and index fingers since 2005. The chips can be read by scanners that Graafstra has installed on the doors of his house, and also on his laptop, which gives him access with a swipe of his hand without the need for keys or passwords.
But you don’t have to have a microchip implant in order to be a part of the Internet of Things.
In fact, there are a whole host of “wearable technologies” that are currently being developed for our society.
For instance, have you heard about “OnStar for the Body” yet? It will enable medical personnel to constantly monitor your health wherever you are…
Smart, cheaper and point-of-care sensors, such as those being developed for the Nokia Sensing XCHALLENGE, will further enable the ‘Digital Checkup’ from anywhere. The world of ‘Quantified Self’ and ‘Quantified Health’ will lead to a new generation of wearable technologies partnered with Artificial Intelligence that will help decipher and make this information actionable.
And this ‘actionability’ is key. We hear the term Big Data used in various contexts; when applied to health information it will likely be the smart integration of massive data sets from the ‘Internet of things’ with the small data about your activity, mood, and other information. When properly filtered, this data set can give insights on a macro level – population health – and micro – ‘OnStar for the Body‘ with a personalized ‘check engine light’ to help identify individual problems before they further develop into expensive, difficult-to-treat or fatal conditions.
If that sounded creepy to you, this next item will probably blow you away.
According to one survey, approximately one-fourth of all professionals in the 18 to 50-year-old age bracket would like to directly connect their brains to the Internet…
According to a survey by tech giant Cisco Systems, about a fourth of professionals ages 18 to 50 would leap at the chance to get a surgical brain implant that allowed them to instantly link their thoughts to the Internet.
The study was conducted on 3,700 adults working in white-collar jobs in 15 countries.
“Assuming a company invented a brain implant that made the World Wide Web instantly accessible to their thoughts, roughly one-quarter would move forward with the operation,” the study found.
In the end, they are not going to have to force most of us to get connected to the Internet of Things.
Most of us will do it eagerly.
But most people will never even stop to consider the potential for abuse.
An Internet of Things could potentially give governments all over the world the ability to continually monitor and track the activities of everyone under their power all of the time.
“Items of interest will be located, identified, monitored, and remotely controlled through technologies such as radio-frequency identification, sensor networks, tiny embedded servers, and energy harvesters — all connected to the next-generation Internet using abundant, low-cost, and high-power computing”
Are you starting to get the picture?
They plan to use the Internet of Things to spy on all of us.
But we just can’t help ourselves. Our society has a love affair with new technology. And some of the things that are being developed right now are beyond what most of us ever dreamed was possible.
For example, Microsoft has just released a new promotional video featuring 3D holograms, smart surfaces, next-generation wearable technologies, and “fluid mobility”…
The elaborate, highly produced video shows jaw-dropping technologies like a SCUBA mask that annotates the sea with 3D holograms, a multipart bracelet that joins together to become a communications device, and interactive, flexible displays that automatically “rehydrate” with information specific to the people using them.
This video from Microsoft was posted on YouTube, and I have shared it below…
So what do you think about all of this?
Please feel free to add to the discussion by posting a comment below…
Most people that discuss the “economic collapse” focus on what is coming in the future. And without a doubt, we are on the verge of some incredibly hard times. But what often gets neglected is the immense permanent damage that has been done to the U.S. economy by the long-term economic collapse that we are already experiencing. In this article I am going to share with you 12 economic charts that show that we are in much, much worse shape than we were five or ten years ago. The long-term problems that are eating away at the foundations of our economy like cancer have not been fixed. In fact, many of them continue to get even worse year after year. But because unprecedented levels of government debt and reckless money printing by the Federal Reserve have bought us a very short window of relative stability, most Americans don’t seem too concerned about our long-term problems. They seem to have faith that our “leaders” will be able to find a way to muddle through whatever challenges are ahead. Hopefully this article will be a wake up call. The last major wave of the economic collapse did a colossal amount of damage to our economic foundations, and now the next major wave of the economic collapse is rapidly approaching.
The mainstream media is constantly telling us about the “employment recovery” that is happening in the United States, but the truth is that it is just an illusion. As the chart below demonstrates, just prior to the last recession about 63 percent of all working age Americans had a job. During the last wave of the economic collapse, that number dropped to below 59 percent and stayed there for a very long time. In the past few months we have finally seen the employment-population ratio tick back up to 59 percent, but we are still far, far below where we used to be. To call the tiny little bump at the end of this chart a “recovery” is really an insult to our intelligence…
#2 The Labor Force Participation Rate
The percentage of Americans that are either employed or currently looking for a job started to fall during the last recession and it has not stopped falling since then. The labor force participation rate has now fallen to a 36 year low, and this is a sign of a very, very sick economy…
#3 The Inactivity Rate For Men In Their Prime Years
Some blame the decline in the labor force participation rate on the aging of our population. But it isn’t just elderly people that are dropping out of the labor force. In fact, the inactivity rate for men in their prime working years (25 to 54) continues to rise and is now at the highest level that has ever been recorded…
#4 Manufacturing Employees
Once upon a time in America, anyone that was reliable and willing to work hard could easily find a manufacturing job somewhere. But we have stood by and allowed millions upon millions of good paying manufacturing jobs to be shipped out of the country, and now many of our formerly great manufacturing cities have been transformed into ghost towns. Over the past few years, there has been a slight “recovery”, but we are still well below where we were at just previous to the last recession…
#5 Our Current Account Balance
As a nation, we buy far more from the rest of the world than they buy from us. In other words, we perpetually consume far more wealth than we produce. This is a recipe for national economic suicide. Our current account balance soared to obscene levels just prior to the last recession, and now we have almost gotten back to those levels…
#6 Existing Home Sales
Our economy has never fully recovered from the housing crash of 2007-2008. As you can see from the chart below, the number of existing home sales is still far below the level that we hit back in 2006. At this point we are just getting back to the level we were at in 2000, but our population today is far larger than it was back then…
#7 New Home Sales
Things are even more dramatic when you look at new home sales. This is an industry that have been absolutely emasculated. The number of new home sales in the United States is just a little more than half of what it was back in 2000, and it isn’t even worth comparing to what we experienced during the peak of 2006.
#8 The Monetary Base
In a desperate attempt to get the economy going again, the Federal Reserve has been wildly printing money. It has been so reckless that it is hard to put it into words. When I look at this chart, the phrase “Weimar Republic” comes to mind…
#9 Food Inflation
Thankfully, much of the money that the Federal Reserve has been injecting into the system has not made it into the real economy. But enough of it has gotten into the system to force food prices significantly higher. For example, my wife went to the store today and paid just a shade under 10 bucks for just four pieces of chicken. And as you can see from the chart below, food prices have been steadily going up in America for a very long time…
#10 The Velocity Of Money
One of the reasons why we have not seen even more inflation is because the velocity of money is extraordinarily low. In general, when an economy is healthy money tends to flow through the system rapidly. People are buying and selling and money changes hands frequently. But when an economy is sick, money tends to stagnate. And that is exactly what is happening in the United States right now. In fact, at this point the velocity of the M2 money stock has dropped to the lowest level ever recorded…
#11 The National Debt
As our economic fundamentals have deteriorated, our politicians have attempted to prop up our standard of living by borrowing from the future. The U.S. national debt is on pace to approximately double during the Obama years, and it increased by more than a trillion dollars in fiscal year 2014 alone. Despite assurances that “the deficit is under control”, the federal government borrows about a trillion dollars a year to fund new spending in addition to borrowing about 7 trillion dollars to pay off old debt that is coming due. What we are doing to future generations of Americans is absolutely criminal, and it is just a matter of time before this Ponzi scheme totally collapses…
#12 Total Debt
Of course it is not just the federal government that is gorging on debt. When you add up all forms of debt in our society (government, business, consumer, etc.) it comes to a grand total of more than 57 trillion dollars. This total has more than doubled since the year 2000…
If you know anyone that believes that we are in good economic shape, just show them these charts.
The numbers do not lie. Our economy is sick and it is getting sicker by the day.
And of course the next major financial crisis could strike at any time. U.S. stocks just experienced their worst week in three years, and if cases of Ebola start popping up around the country the fear that would cause could collapse our economy all by itself.
The debt-fueled prosperity that we are enjoying today is not real. We are living on the fumes of our past, and every single day our long-term problems get even worse.
Anyone with half a brain should be able to see what is coming.
Sadly, most Americans will continue to deny the truth until it is far too late.
The idea that the Obama administration has the budget deficit under control is a complete and total lie. According to the U.S. Treasury, the federal government has officially run a deficit of 589 billion dollars for the first 11 months of fiscal year 2014. But this number is just for public consumption and it relies on accounting tricks which massively understate how much debt is actually being accumulated. If you want to know what the real budget deficit is, all you have to do is go to a U.S. Treasury website which calculates the U.S. national debt to the penny. On September 30th, 2013 the U.S. national debt was sitting at $16,738,183,526,697.32. As I write this, the U.S. national debt is sitting at $17,742,108,970,073.37. That means that the U.S. national debt has actually grown by more than a trillion dollars in less than 12 months. We continue to wildly run up debt as if there is no tomorrow, and by doing so we are destroying the future of this nation.
The chart that I have posted below shows the exponential growth of the U.S. national debt over the past several decades. Anyone that would characterize this as “under control” is lying to you…
This is the greatest government debt bubble in the history of the world, but very few people seem to have any desire to do anything about this anymore. We are literally gorging on debt, and most Americans seem to think that it is just fine and dandy.
Perhaps that it is because we have never really experienced any serious consequences for going into so much debt yet.
But when it comes to running up debt, a day of reckoning always comes eventually.
Just ask Greece.
And the absolutely insane spending policies of this administration and this Congress are hastening the day when our day of reckoning will arrive.
Consider the following facts…
-The U.S. national debt has increased by more than 7 trillion dollars since Barack Obama has been in the White House. By the time Obama’s second term is over, we will have accumulated about as much new debt under his leadership than we did under all of the other U.S. presidents in all of U.S. history combined.
-The U.S. national debt is now more than 5000 times larger than it was when the Federal Reserve was first established in 1913.
-If the U.S. national debt was reduced to a stack of one dollar bills it would circle the earth at the equator 45 times.
-Right now, the United States already has more government debt per capita than Greece, Portugal, Italy, Ireland or Spain.
-In August, the average rate of interest on the government’s marketable debt was 2.028 percent. In January 2000, the average rate of interest on the government’s marketable debt was 6.620 percent. If we got back to that level today, we would be paying well over a trillion dollars a year just in interest on the national debt.
-At this point the U.S. government has accumulated more than 200 trillion dollars of unfunded liabilities that will need to be paid in future years. In other words, we have made more than 200 trillion dollars worth of promises that we do not have money for yet.
Thomas Jefferson once said that “the principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale.”
What we are doing to future generations is absolutely unconscionable. We are stealing trillions upon trillions of dollars from our children and our grandchildren, and we are willingly consigning them to a lifetime of debt slavery.
I have said this before, but it bears repeating. If future generations get the chance, they will look back and curse us for what we have done to them.
And shame on anyone that would dare to suggest that we should continue to run up more debt that future generations will be expected to repay.
But government debt is far from the only massive debt bubble that we are dealing with as a country.
40 years ago, the total amount of debt in our nation (all government debt plus all business debt plus all individual debt) was sitting at a grand total of about 2.3 trillion dollars.
Today, that total has grown to 59.4 trillion dollars.
As the chart posted below shows, our total debt bubble is now more than 25 times larger than it was just 40 years ago…
If you were to take all forms of debt in our country and divide it up equally to each person, the average family of four would owe approximately $735,000.
This is not anywhere close to being sustainable, but most Americans don’t seem to care. They just continue to recklessly run up even more debt.
However, there are signs that we are starting to hit a wall with all of this debt.
For example, an astounding 35 percent of all Americans have debts that are so overdue that they have been referred to collection agencies.
Our nation has become an ocean of red ink from sea to shining sea, and the only way to keep the bubble from bursting is for the total amount of debt to continue to grow much faster than the overall economy is growing.
The big question is how long our “bubble economy” can keep going before it finally collapses.
It has gotten to the point where even some of the biggest banks in the world are admitting that what we have been doing is completely and totally unsustainable. Just consider the following excerpt from a recent article by Joshua Krause…
Recently, strategists for Deutsche Bank released a startling study in regards to government debt. They decided to investigate whether or not the bond market is currently in a bubble. What they found was, unlike previous eras, the past 20 years has seen no lag between economic booms and busts:
It has long been our view that over the last couple of decades the global economy has rolled from bubble to bubble with excesses never fully being allowed to unravel. Instead aggressive policy responses have encouraged them to roll into new bubbles.
This has arguably kept the modern financial system as we know it a going concern. Clearly there have always been bubbles formed through history but has there been a period like the last 20 years where the bursting of one bubble has consistently led directly to the formation of the next?
Essentially, our current system has been dying a very slow death. It’s running out of steam.
Sadly, most Americans have no idea that we are living in a giant debt-fueled bubble that has a limited lifespan.
Most Americans just assume that since the politicians tell them that everything is going to be okay that they don’t need to be concerned about any of this.
But every single day our debts get even larger and our long-term financial problems get even worse.
Someday this bubble is going to burst and then all hell will break loose.
Are you ready to have your veins scanned every time you use your bank account? Are you ready to use a “digital tattoo” or a microchip implant to unlock your telephone? Once upon a time we read about such technologies in science fiction novels, but now they are here. The era of widespread biometric identification and microchip implants is upon us, and it is going to change the way that we live. Proponents of these new technologies say that they will make our private information and our bank accounts much more secure. But there are others that warn that these kinds of “Big Brother technologies” will set the stage for even more government intrusion into our lives. In the wrong hands, such technologies could prove to be an absolute nightmare.
Barclays has just announced that it is going to become the first major bank in the western world to use vein scanning technology to control access to bank accounts. There will even be a biometric reader that customers plug into their computers at home…
Barclays is launching a vein scanner for customers as it steps up use of biometric recognition technology to combat banking fraud.
The bank has teamed up with Japanese technology firm Hitachi to develop a biometric reader that scans a customer’s finger to access accounts, instead of using a password or PIN.
The biometric reader, which plugs into a customer’s computer at home, uses infrared lights to scan blood flow in a person’s finger. The user must then scan the same finger a second time to confirm a transaction. Each “vein profile” will be stored on a SIM card inside the device.
Vein recognition technology is used by some banks in Japan and elsewhere at ATM machines, but Barclays said it is the first bank globally to use it for significant account transactions.
But Barclays is not the only one that is making a big move into biometric identification.
Online retailing behemoth Alibaba is going to start using fingerprint scanning in an attempt to make their transactions more secure…
Alibaba, the giant Chinese online retailer, is integrating fingerprint scanning into its Alipay Wallet app. Foxconn, the Taiwanese manufacturer of the iPhone and iPad, threw nearly $5 million at Norway’s NEXT Biometrics, which develops fingerprint scanning technology, back in May. And earlier this month it took a 10% stake for $2 million in AirSig, a Taiwanese company that uses smartphones’ built-in gyroscopes to track air handwriting. The company says AirSig provides three-factor authentication: your signature, your phone, and the way you sign with a flourish in mid-air.
It is only a matter of time before more banks, online retailers and major websites start using this kind of technology. We live at a time when theft on the Internet threatens to spiral out of control, and big corporations are going to be continually looking for answers.
Cell phone security is another area of great concern these days. If someone can get a hold of your phone and unlock it, that person can potentially do all sorts of damage.
So Motorola has developed a “digital tattoo” that will be used to ensure that only the owner of a phone is able to unlock it. The following is how Motorola described these new digital tattoos…
Made of super thin, flexible materials, based on VivaLnk’s eSkinTM technology, each digital tattoo is designed to unlock your phone with just a touch of your Moto X to the tattoo, no passwords required. The nickel-sized tattoo is adhesive, lasts for five days, and is made to stay on through showering, swimming, and vigorous activities like jogging. And it’s beautiful—with a shimmering, intricate design.
It’s another step in making it easier to unlock your phone on the go and keep your personal information safe. An average user takes 2.3 seconds to unlock their phone and does this about 39 times a day—a process that some people find so inconvenient that they do not lock their phones at all. Using NFC technology, digital tattoos make it faster to safely unlock your phone anywhere without having to enter a password.
And below I have posted the video that Motorola shared on YouTube about these tattoos…
Pretty bizarre stuff, eh?
But others are taking cell phone security to even greater extremes.
With a wave of his left hand, Ben Slater can open his front door, turn on the lights and will soon be able to start his car. Without even a touch he can link to databases containing limitless information, including personal details such as names, addresses and health records.
The digital advertising director has joined a small number of Australians who have inserted microchips into their skin to be at the cutting edge of the next stage of the evolution of technology.
Slater was prompted to be implanted in anticipation of the iPhone 6 release on September 9.
The conjecture among pundits and fans worldwide over what chief executive Tim Cook will reveal is building.
At present the iPhone cannot read microchip implants. However, Mr Slater believes the new version will have that capability. His confidence is now lodged between his thumb and forefinger.
Of course this kind of thing is not new. People have been getting implanted with microchips for years. If you doubt this, just do an Internet search for “biohackers” and see what you find.
But it is starting to become more mainstream, and there are already some thinkers that are quite eager to use such technology for very authoritarian purposes.
For example, one prominent philosopher recently suggested that we should use implantable microchips to prevent anyone that is “deemed unworthy” from becoming a parent…
Although he admits it “sounds blatantly authoritarian” and “violates just about every core value we possess in a free society,” a noted transhumanist author has said a world government body should forcibly sterilize anyone “deemed unworthy” of parenthood by using implanted microchips.
Constitutional attorney and civil liberties expert John W. Whitehead, founder of The Rutherford Institute, warned LifeSiteNews earlier this year that political officials would long to use this seminal technology.
In an article for Wired.com today, philosopher Zoltan Istvan wrote that the notion first crossed his mind when he heard a blonde nurse say, “with 10,000 kids dying everyday around the world from starvation, you’d think we’d put birth control in the water.”
After careful thought, in an effort to “give hundreds of millions of future kids a better life, I cautiously endorse the idea of licensing parents,” Istvan wrote today.
You might be tempted to think that this is crazy talk.
But the truth is that this kind of technology is already being developed.
Helped along by one of the world’s most notable billionaires, a U.S. firm is developing a tiny implant that acts as a contraceptive for 16 years — and can be turned on or off using a remote control.
The birth control microchip, funded by the Bill and Melinda Gates Foundation, would hold nearly two decades worth of a hormone commonly used in contraceptives and dispense 30 micrograms a day, according to a report from the MIT Technology Review.
The new birth control, which is set to begin preclinical testing next year with hopes of putting it on shelves in 2018, can be implanted in the buttocks, upper arm or abdomen.
Yes, I know that a lot of the things that I have talked about in this article sound really weird.
But the reality of the matter is that technology is changing at an exponential rate, and our world is going to get crazier and crazier as time goes by.
Should we be concerned that the percentage of Americans that are either working or looking for work is the lowest that it has been in 36 years? In August, an all-time record high 92,269,000 Americans 16 years of age and older did not “participate in the labor force”. And when you throw in the people that are considered to be “in the labor force” but are not currently employed, that pushes the total of working age Americans that do not have jobs to well over 100 million. Yes, it may be hard to believe, but there are more than 100 million working age Americans that are not employed right now. Needless to say, this is not a sign of a healthy economy, and it is a huge reason why dependence on the government has soared to absolutely unprecedented levels. When people can’t take care of themselves, they need someone else to take care of them. If the percentage of people in the labor force continues to decline like it has been, what is that going to mean for the future of our society?
The chart below shows the changes in the civilian labor force participation rate since 1980. As you can see, the rate steadily rose between 1980 and 2000, but since then it has generally been declining. In particular, this decline has greatly accelerated since the beginning of the last recession…
We have never seen an extended precipitous decline of this nature before. But instead of admitting that we have a very serious problem on our hands, many mainstream economists are dismissing this decline as “structural in nature”. For example, check out the following excerpt from a recent Reuters article…
A paper published on Thursday by the Brookings Institution, a Washington-based think tank, suggested the decline was primarily due to an aging population and other structural factors, and concluded the labor force would continue to shrink.
But there is a major flaw in this analysis. It turns out that older Americans are the only group for which employment numbers have actually been going up. I really like how Zero Hedge made this point the other day…
Well that’s very odd, because it was only two months ago that the Census wrote the following: “Many older workers managed to stay employed during the recession; in fact, the population in age groups 65 and over were the only ones not to see a decline in the employment share from 2005 to 2010 (Figure 3-25)… Remaining employed and delaying retirement was one way of lessening the impact of the stock market decline and subsequent loss in retirement savings.”
Yes, Baby Boomers are hitting retirement age.
But that does not explain why the labor force participation rate numbers for younger groups have been going down.
Each month, the U.S. economy has to add somewhere between 100,000 and 150,000 jobs just to keep up with population growth. Since job creation has been tepid at best in recent years, the only way that the government has been able to get the official unemployment rate to steadily “go down” has been to remove millions upon millions of Americans from the labor force.
According to the official government numbers, since 2007 768,000 jobs have been added to the economy, but a whopping 13 million Americans have been added to the numbers of those “not in the labor force”.
As a result, the official unemployment rate has magically been “declining”.
But the truth is that our employment crisis has not been solved at all.
And it isn’t just the number of jobs that we need to be concerned about. We are also dealing with a multi-year decline in the quality of our jobs. In fact, the Wall Street Journal just reported that 34 percent of all U.S. workers are “freelancers” now…
More evidence that this isn’t your parents’ labor market: Roughly one in three U.S. workers is now a freelancer.
Fifty-three million Americans, or 34% of the nation’s workforce, qualify as freelancers, according to a new report from the Freelancers Union, a nonprofit organization, and Elance-oDesk Inc., a company that provides platforms for freelancers to find work. These individuals include independent contractors, temps, and moonlighters, among others.
In other words, about a third of all workers in the country are “temps” at this point.
I don’t know about you, but to me that is an extremely alarming statistic.
If the economy really was recovering, this would not be happening.
And as millions upon millions of Americans are being forced out of the official labor force, an increasing number of people are turning to the underground economy.
But our authorities never seem to want to admit what our real problems are.
Instead, they love to come up with alternative theories for our economic struggles.
One of the latest theories being put forward by the Federal Reserve is that the economy is not moving along like it should because ordinary Americans are “hoarding money”…
One of the great mysteries of the post-financial crisis world is why the U.S. has lacked inflation despite all the money being pumped into the economy.
The St. Louis Federal Reserve thinks it has the answer: A paper the central bank branch published this week blames the low level of money movement in large part on consumers and their “willingness to hoard money.”
This seems completely absurd to me.
From what I can see, most families are just doing their best to survive from month to month these days.
I certainly don’t see a lot of people “hoarding money”.
What about you?
What do you think?
Please feel free to share your thoughts by posting a comment below…
Russia and China have just signed what is being called “the gas deal of the century”, and the two countries are discussing moving away from the U.S. dollar and using their own currencies to trade with one another. This has huge implications for the future of the U.S. economy, but the mainstream media in the United States is being strangely quiet about all of this. For example, I searched CNN’s website to see if I could find something about this gas deal between Russia and China and I did not find anything. But I did find links to “top stories” entitled “Celebs who went faux red” and “Adorable kid tugs on Obama’s ear“. Is it any wonder why the mainstream media is dying? If a particular story does not fit their agenda, they will simply ignore it. But the truth is that this new agreement between Russia and China is huge. It could end up fundamentally changing the global financial system, and not in a way that would be beneficial for the United States.
Russia and China had been negotiating this natural gas deal for ten years, and now it is finally done. Russia is the largest exporter of natural gas on the entire planet, and China is poised to become the world’s largest economy in just a few years. This new $400 billion agreement means that these two superpowers could potentially enjoy a mutually beneficial relationship for the next 30 years…
Russia reached a $400 billion deal to supply natural gas to China through a new pipeline over 30 years, a milestone in relations between the world’s largest energy producer and the biggest consumer.
President Vladimir Putin is turning to China to bolster Russia’s economy as relations sour with the U.S. and European Union because of the crisis in Ukraine. Today’s accord, signed after more than a decade of talks, will allow state-run gas producer OAO Gazprom (GAZP) to invest $55 billion developing giant gas fields in eastern Siberia and building the pipeline, Putin said.
It’s an “epochal event,” Putin said in Shanghai after the contract was signed. Both countries are satisfied with the price, he said.
Of course countries sell oil and natural gas to each other all the time. But what makes this deal such a potential problem for the U.S. is the fact that Russia and China are working on cutting the U.S. dollar out of the entire equation. Just check out the following excerpt from a recent article in a Russian news source…
Russia and China are planning to increase the volume of direct payments in mutual trade in their national currencies, according to a joint statement on a new stage of comprehensive partnership and strategic cooperation signed during high-level talks in Shanghai on Tuesday.
“The sides intend to take new steps to increase the level and expansion of spheres of Russian-Chinese practical cooperation, in particular to establish close cooperation in the financial sphere, including an increase in direct payments in the Russian and Chinese national currencies in trade, investments and loan services,” the statement said.
In my recent article entitled “De-Dollarization: Russia Is On The Verge Of Dealing A Massive Blow To The Petrodollar“, I warned about what could happen if the petrodollar monopoly ends. In the United States, our current standard of living is extremely dependent on the rest of the world continuing to use our currency to trade with one another. If Russia starts selling natural gas to China without the U.S. dollar being involved, that would be a monumental blow to the petrodollar. And if other nations started following the lead of Russia and China, that could result in an avalanche from which the petrodollar may never recover.
And it isn’t just the national governments of Russia and China that are discussing moving away from the U.S. dollar. For example, the second largest bank in Russia just signed a deal with the Bank of China “to pay each other in domestic currencies”…
VTB, Russia’s second biggest lender, has signed a deal with Bank of China, which includes an agreement to pay each other in domestic currencies.
“Under the agreement, the banks plan to develop their partnership in a number of areas, including cooperation on ruble and renminbi settlements, investment banking, inter-bank lending, trade finance and capital-markets transactions,” says the official VTB statement.
The deal underlines VTB Group’s growing interest in Asian markets and will help grow trade between Russia and China that are already close trading partners, said VTB Bank Management Board Vasily Titov.
You can almost feel the power of the U.S. dollar fading.
Well, now China’s intentions have become even more clear.
The Chinese do not plan to allow the United States to indefinitely dominate the globe financially. In the long run, the Chinese plan to be the ones calling the shots, and that means that the power of the U.S. dollar must decline.
These days, instead of piling up mountains of U.S. currency, China has started accumulating hard assets instead. In the past, I have written about how China is rapidly stockpiling gold, and it turns out that the Chinese have also been very busy stockpiling oil as well…
China is stockpiling oil for its strategic petroleum reserve at a record pace, intervening on a scale large enough to send a powerful pulse through the world crude market.
The move comes as tensions mount in the South China Sea and the West prepares possible oil sanctions against Russia over the crisis in eastern Ukraine. Analysts believe China is quietly building up buffers against a possible spike in oil prices or disruptions in supply.
The International Energy Agency (IEA) said in its latest monthly report that China imported 6.81m barrels per day (bpd) in April, an all-time high.
Once upon a time, China was extremely dependent on the United States economically. The same was true with most of the rest of the world.
But now economic power has shifted so dramatically that nations such as Russia and China are realizing that they don’t really need to be dependent on the United States any longer.
And with each passing year, the relationship between Russia and China is becoming stronger. As Pepe Escobar recently observed, this emerging alliance is causing quite a bit of consternation in Washington…
And no wonder Washington is anxious. That alliance is already a done deal in a variety of ways: through the BRICS group of emerging powers (Brazil, Russia, India, China, and South Africa); at the Shanghai Cooperation Organization, the Asian counterweight to NATO; inside the G20; and via the 120-member-nation Non-Aligned Movement (NAM). Trade and commerce are just part of the future bargain. Synergies in the development of new military technologies beckon as well. After Russia’s Star Wars-style, ultra-sophisticated S-500 air defense anti-missile system comes online in 2018, Beijing is sure to want a version of it. Meanwhile, Russia is about to sell dozens of state-of-the-art Sukhoi Su-35 jet fighters to the Chinese as Beijing and Moscow move to seal an aviation-industrial partnership.
China on Tuesday warned the United States was jeopardizing military ties by charging five Chinese officers with cyberspying and tried to turn the tables on Washington by calling it “the biggest attacker of China’s cyberspace.”
China announced it was suspending cooperation with the United States in a joint cybersecurity task force over Monday’s charges that officers stole trade secrets from major American companies. The Foreign Ministry demanded Washington withdraw the indictment.
The testy exchange marked an escalation in tensions over U.S. complaints that China’s military uses its cyber warfare skills to steal foreign trade secrets to help the country’s vast state-owned industrial sector.
The divide between the East and the West is growing.
But the Obama administration has not figured out that we need the East more than they need us.
Right now, the number one U.S. export is U.S. dollars. Our massively inflated standard of living is very heavily dependent on the rest of the world using our currency to trade with one another and lending it to us at super low interest rates.
If the rest of the world quits playing our game, our debt-based financial system will quickly fall apart.
Unfortunately, nobody in the Obama administration seems to have much understanding of global economics, and they will probably continue to antagonize Russia and China.
In the end, the consequences for antagonizing them could end up being far greater than any of us ever imagined.