The U.S. Economy

The Mississippi River Is Drying Up

The worst drought in more than 50 years is having a devastating impact on the Mississippi River. The Mississippi has become very thin and very narrow, and if it keeps on dropping there is a very real possibility that all river traffic could get shut down. And considering the fact that approximately 60 percent of our grain, 22 percent of our oil and natural gas, and and one-fifth of our coal travel down the Mississippi River, that would be absolutely crippling for our economy. It has been estimated that if all Mississippi River traffic was stopped that it would cost the U.S. economy 300 million dollars a day. So far most of the media coverage of this historic drought has focused on the impact that it is having on farmers and ranchers, but the health of the Mississippi River is also absolutely crucial to the economic success of this nation, and right now the Mississippi is in incredibly bad shape. In some areas the river is already 20 feet below normal and the water is expected to continue to drop. If we have another 12 months of weather ahead of us similar to what we have seen over the last 12 months then the mighty Mississippi is going to be a complete and total disaster zone by this time next year.

Most Americans simply do not understand how vitally important the Mississippi River is to all of us. If the Mississippi River continues drying up to the point where commercial travel is no longer possible, it would be an absolutely devastating blow to the U.S. economy.

Unfortunately, vast stretches of the Mississippi are already dangerously low. The following is an excerpt from a transcript of a CNN report that aired on August 14th….

You might think this is some kind of desert just outside of Memphis. It’s not. I’m actually standing on the exposed bottom of the Mississippi River. That’s how dramatic the drought impact is being felt here. Hard to believe, a year ago we were talking about record flooding. Now, they are worried about a new kind of record: a record low. The river was three miles wide here, it’s now down to three tenths of a mile. And that’s causing all kinds of problems. There are some benefits, I mean, take a look over here: new beach front. In fact, some quip that now the Mississippi River has more beaches than the entire state of Florida, which would be funny if it didn’t have an impact on trade.

A lot of stuff we use goes up and down the Mississippi River. We are talking steel, coal, ore, grain. The problem is now a lot of those barges have had to lighten their loads, and even doing that, they are still running aground. There is a real fear that there could be a possibility of closing the Mississippi River. If that happens, well, all that product that used to be carried cheaply by barge is now going to be carried more expensively by truck or train. And guess who is going to pay for all of that.

You can see video footage of what is happening along the Mississippi right here.

It really is amazing that last year we were talking about historic flooding along the Mississippi and this year we are talking about the Mississippi possibly drying up.

As I mentioned earlier, there are some areas along the river that are already 20 feet below normal levels. The following is from a recent article posted on inquisitr.com….

Just outside of Memphis the river is 13 feet below normal depth while the National Weather Service says Vicksburg, Mississippi is 20 feet below normal levels. Overall the Mississippi is 13 feet below normal averages for this time of year.

The drying up river is forcing barge, tugboat and towboat operators to navigate narrower and more shallow spots in the river, slowing their speeds as they pass dangerously close to one another. In some parts of the Mississippi the river is so narrow that one-way traffic is being utilized.

A lot of barges have been forced to go with greatly reduced loads so that they will sit higher in the river, and other commercial craft have been forced to stop operating completely.

For example, the Mississippi has dropped so low at this point that the famous American Queen Steamboat can no longer safely navigate the river.

Down south, the Mississippi River has gotten so low that saltwater is actually starting to move upriver. The U.S. Army Corps of Engineers is fighting hard to keep that contained.

Other waterways in the middle part of the country are in even worse shape.

For example, a 100 mile stretch of the Platte River has already dried up. Millions of fish are dying as rivers and streams all over the country continue to get shallower and warmer as a result of the ongoing drought.

The last time the condition of the Mississippi River was this bad was back in 1988. At that time, a lot of barge traffic was stopped completely and the shipping industry lost approximately a billion dollars.

If a similar thing were to happen now, the consequences could potentially be far worse.

As I wrote about recently, a standstill along the Mississippi would cost the U.S. economy about 300 million dollars a day.

In fact, one towing company that works on the Mississippi says that it has already been losing about $500,000 a month since May.

In the end, who is going to pay for all of this?

You and I will.

In fact, this crisis could end up costing American consumers a whole lot of money….

So here’s the math. If you want to raise the average barge one inch above the water, you’ve got to take off 17-tons of cargo. To raise it a foot, you’re talking 200 tons.

And since, according to the American Waterways Operators, moving cargo by river is $11 a ton cheaper than by train or truck. The more that now has to be moved on land, well, the more the costs go up. Steven Barry says, “And, eventually, the consumer’s gonna pay that price somewhere along the line.”

And considering the fact that we are already facing a potential food crisis due to the drought, the last thing we need is for the Mississippi River to dry up.

So is there any hope on the horizon for the Mississippi?

Unfortunately, things do not look promising.

The fall and the winter are typically drier than the summer is along the Mississippi River. That means that conditions along the river could actually get even worse in the months ahead. The following is from a recent Time Magazine article….

But without significant rainfall, which isn’t in any long-range forecasts, things are likely to get worse. As summer turns to fall, the weather tends to get drier. Lower temperatures generally mean fewer thunderstorms and less rainfall.

“Take away the thunderstorm mechanism and you run into more serious problems,” says Alex Sosnowski, expert senior meteorologist for AccuWeather.com. And while droughts tend to be a temporary setback, longer-range forecasts are troublesome. Sosnowski says he is anticipating an El Niño weather pattern next year, which would mean below-normal snowfall and above-average temperatures.

Let us hope and pray that we don’t see another 12 months similar to the 12 months that we have just been through.

The U.S. economy is already in bad enough shape.

We don’t need any more major problems on top of what we are already dealing with.

So what do you think about this? Please feel free to post a comment with your thoughts below….

17 Reasons Why Those Hoping For A Recession In 2012 Just Got Their Wish

If you were hoping for a recession in 2012, then you are going to be very happy with the numbers you are about to see. The U.S. economy is heading downhill just in time for the 2012 election. Retail sales have fallen for three months in a row for the first time since 2008, manufacturing activity is dropping like a rock, sales of new homes are declining again, consumer confidence has moved significantly lower and a depressingly small percentage of businesses anticipate hiring more workers in the coming months. Even though the Federal Reserve has been wildly pumping money into the financial system and even though the federal government has been injecting gigantic piles of borrowed cash into the economy, we still haven’t seen an economic recovery. In fact, we appear to be on the verge of yet another major downturn. In California the other night, Barack Obama told supporters that “we tried our plan — and it worked“, but only those that are still drinking the Obama kool-aid would believe something so preposterous. The truth is that the U.S. economy has been steadily declining for many years and now we have reached another very painful recession.

And don’t let the second quarter GDP number on Friday fool you. Analysts are expecting to see GDP growth of about 1.4 percent for the second quarter, but the only reason for our very small amount of “economic growth” is because the economy has been flooded with new dollars.

Let me give you an example. If I could go out overnight and magically double the bank accounts of every single American, would we all be twice as wealthy?

No, because there would be twice as many dollars now chasing the same amount of goods and services. The price of those goods and services would soon rise dramatically to reflect this new reality.

With all of those new dollars spinning around in the economy it would look like “economic growth” was going through the roof, but in reality the amount of real economic activity would be about the same.

So whenever we talk about GDP, we need to properly adjust it for inflation. That means using accurate inflation figures and not the highly manipulated inflation figures that the U.S. government is putting out these days.

And as I noted the other day, after properly adjusting for inflation the U.S. economy has been continually experiencing negative economic growth since about 2005.

So let’s not deceive ourselves. The U.S. economy has been declining for a long time.

But soon even the GDP number that the government gives us will turn negative. We will probably see a slightly positive number for the second quarter, and the number will likely go negative either in the third quarter or the fourth quarter.

Economists will debate when this new recession officially “began” just like they do with every recession, but it doesn’t take a genius to figure out what is happening to our economy right now.

The following are 17 reasons why those hoping for a recession in 2012 just got their wish….

1. U.S. retail sales have declined for three months in a row. This is the first time this has happened since 2008. Every other time this has happened in U.S. history (except for once) this has signaled that the U.S. economy was either already in a recession or was about to enter one.

2. The Philadelphia Fed index of manufacturing activity contracted for the third month in a row during July. According to the Financial Post, this is a very bad sign….

Seven out of eight times when the average reading has been that low (-11.8) for that long the U.S. economy has tipped into recession.

3. Manufacturing activity in the mid-Atlantic region has also declined for three months in a row. In fact, the only time in the past decade when manufacturing activity in the mid-Atlantic has fallen more dramatically was during the last recession.

4. A factory index calculated by the Institute for Supply Management has fallen to its lowest level since June 2009.

5. The Conference Board index of leading economic indicators has fallen for two of the past three months.

6. According to a recent survey conducted by the Conference Board, only 17 percent of CEOs had a positive view of the economy during the second quarter of 2012. During the first quarter of 2012, 67 percent did.

7. Gallup’s U.S. Economic Confidence Index is now the lowest that it has been since January.

8. Optimism among small business owners has declined in three of the last four months and is now at its lowest level since last October.

9. Believe it or not, the amount of waste being carted around on trains in the United States has an 82 percent correlation with U.S. economic growth. Unfortunately, right now the number of garbage carloads on trains is falling dramatically.

10. Sales of previously occupied homes dropped by 5.4 percent during June.

11. Sales of new homes declined by 8.4 percent during June. At this point new home sales are less than a third of what they were during the boom years.

12. An increasing number of Americans are relying on high interest “payday loans” to pay the rent and put food on the table.

13. Far more companies are defaulting on their debts this year than last year.

14. According to the U.S. Labor Department, the unemployment rate fell in 11 states and Washington, D.C. last month, but it rose in 27 states.

15. The unemployment rate in New York City is now back up to 10 percent. That equals the peak unemployment rate in New York City during the last recession.

16. The teen unemployment rate in Washington D.C. right now is 51.7 percent.

17. A recent survey conducted by the National Association for Business Economics found that only 23 percent of all U.S. companies plan to hire more workers over the next 6 months. When the same question was asked a few months ago that number was at 39 percent.

All of those are very powerful pieces of evidence that a new recession has started.

But do you want to know one of my favorite indicators that the U.S. economy is sliding into recession?

In a previous article, I noted that Federal Reserve Chairman Ben Bernanke made the following statement to Congress recently: “At this point we don’t see a double dip recession. We see continued moderate growth.”

As I mentioned the other day, Bernanke has a track record of failure that is absolutely embarrassing. Back on January 10, 2008 Bernanke made the following statement….

“The Federal Reserve is not currently forecasting a recession.”

That turned out to be a great call, didn’t it?

On June 10, 2008 he doubled down on his call that the U.S. economy was going to avoid a recession….

“The risk that the economy has entered a substantial downturn appears to have diminished over the past month or so.”

Just before Fannie Mae and Freddie Mac collapsed Bernanke made this statement….

“The GSEs are adequately capitalized. They are in no danger of failing.”

And there are dozens of other examples just like these.

This is the guy running our economic system.

I am very critical of the Federal Reserve, but there are very good reasons for this.

The Federal Reserve is running our economy into the ground, and we need to pound this into the heads of the American people so that they will wake up and demand change.

Perhaps this next recession will be painful enough to wake people up.

The Wall Street Journal is already even using the “D word” to describe what we are experiencing. Just today, the Wall Street Journal ran an article that asked this question: “Do Two Recessions Equal One Depression?”

Sadly, this is just the leading edge of what is coming. By the time 2014 or 2015 rolls around, we are going to look back and long for the “good old days” of 2011 and 2012.

Over the next few years, the unemployment rate is going to skyrocket and poverty in the United States is going to get a whole lot worse.

Now is not the time to goof off. Now is the time to work really hard to get yourself and your family into the best position that you can for the storm that is coming.

Nothing is going to stop the terrible economic crisis that is coming, but at least we can get prepared for it.

There is hope in being prepared.

Sadly, most people will never even see the next crisis coming until they get blindsided by it.

20 Signs That All Point To The Exact Same Thing – Can You Guess What That Is?

The U.S. economy is in a massive amount of trouble. There aren’t enough jobs. There isn’t enough money to go around. Business activity is slowing down again. Household wealth has been falling. Food prices have been rising. Many state and local governments all over the country are flat broke and are drowning in debt. The federal government has been rolling up unprecedented amounts of debt in an attempt to keep things going, but everyone knows that kind of borrowing is simply unsustainable. So where do we go from here? We consume far more than we produce and we use debt to make up the difference. 40 years ago the total amount of debt in America (government, business and consumer) was less than 2 trillion dollars. Today it is nearly 55 trillion dollars. How in the world did we let the total amount of debt in the United States grow more than 27 times larger over the past 40 years? Our economic system is fundamentally broken, but most Americans don’t realize it yet because times are still relatively good.

However, the next great economic crisis is going to wake a whole lot of Americans up.

And when they realize what has happened to our future, they are going to be really, really angry.

Enjoy the good times while they last. The next recession is rapidly approaching, and it will not be pleasant.

The following are 20 signs that all point to the exact same thing….

#1 The unemployment rate in the U.S. has been above 8 percent for 40 months in a row, and 42 percent of all unemployed Americans have been out of work for at least half a year. As I wrote about recently, there are never going to be enough jobs in America ever again. As bad as things are right now, they are about to get even worse. So what is our country going to look like once the unemployment rate starts shooting up rapidly once again?

#2 35 percent of all unemployed workers have had to dip into retirement savings in order to make ends meet over the past year.

#3 Since 2008, the U.S. economy has lost 1.3 million jobs while at the same time 3.6 million more Americans have been added to Social Security’s disability insurance program.

#4 A recent survey conducted by the National Association for Business Economics found that only 23 percent of all U.S. companies plan to hire more workers over the next 6 months. When the same question was asked a few months ago that number was at 39 percent.

#5 An important measure of U.S. manufacturing activity has fallen to its lowest level since June 2009.

#6 Hundreds of thousands of federal jobs at civilian agencies will likely be lost if Congress allows the automatic federal budget cuts to go into effect next year. The following is from a recent article posted on federalnewsradio.com….

A report released Tuesday suggests that several hundred thousand federal jobs at civilian agencies would be on the chopping block within the next year if Congress lets the automatic budget cutting process known as sequestration go into effect.

The study, authored by George Mason University professor Stephen Fuller, adds a new dimension to a budget debate that’s so far been centered on sequestration’s effects on the military.

#7 The teen unemployment rate in Washington D.C. right now is 51.7 percent.

#8 Gallup’s U.S. Economic Confidence Index is now the lowest that it has been since January.

#9 The median net worth of U.S. households in 2007 was $126,400. By 2010, it had fallen to just $77,300.

#10 Pensions at S&P 500 companies are more under-funded than they have ever been before.

#11 According to the New York Times, state and local governments across America “shortchanged their pension plans by more than $50 billion” between 2007 and 2011.

#12 The city of Compton, California is evaluating whether or not it should declare bankruptcy. If it did, it would become the fourth California city to declare bankruptcy this year.

#13 The percentage of U.S. households that are spending more than half their incomes on housing is at an all-time high.

#14 For the first time in modern history, Canadian households are wealthier than American households are.

#15 One recent poll found that 42 percent of all Americans believe that China is the leading economic power in the world while only 36 percent believe that the U.S. is still the leading economic power in the world.

#16 According to the federal government, the price of food rose much faster than the general rate of inflation did during 2011. Just check out these rates of food inflation for 2011….

Beef: +10.2%
Pork: +8.5%
Fish: +7.1%
Eggs: +9.2%
Dairy: +6.8%
Oils and Fats: +9.3%

If that happened during a somewhat “normal year”, what will food prices look like after we are done with the drought of 2012?

#17 The price of a bushel of corn has risen by 54 percent since mid-June.

#18 According to one survey, 42 percent of all American workers are living paycheck to paycheck.

#19 A different survey found that 28 percent of all Americans have absolutely no emergency savings at all right now.

#20 Federal Reserve Chairman Ben Bernanke made the following statement to Congress on Tuesday: “At this point we don’t see a double dip recession. We see continued moderate growth.”

Do you remember that old Seinfeld episode when George Costanza decided that he would “do the opposite” of everything that his instincts were telling him to do and everything started working out great for him?

Well, when it comes to Federal Reserve Chairman Ben Bernanke, the key is to “believe the opposite” of everything that he says.

And since Bernanke does not believe that a double dip recession is going to happen, that probably means that we are about to hit another recession.

If you doubt this theory about Bernanke, just go back and check out his track record.

Okay, so if our economy is in big trouble shouldn’t our leaders be doing something about it?

Well, it is election season now so I wouldn’t expect too much from Barack Obama. He is too busy raising money in France and in China.

I wouldn’t expect too much from Obama’s economic advisers either. In fact, Obama’s much-ballyhooed “jobs council” has not even met in six months.

Not that the “jobs council” was ever going to do anything substantive anyway.

The truth is that it was just for show and most of the CEOs on the council have been sending jobs overseas anyway.

Well, what about the SEC?

Shouldn’t they be doing something to fix the financial system?

No, they are too busy investigating the Amish.

It looks like we are on our own.

Soon, even more parts of the country will start looking like Detroit or Baltimore or Cleveland.

This country is rapidly falling apart, and the federal government is not going to save us.

That is why we need to focus on preparing to weather the coming storm on a family and community level.

There is hope in being prepared. The coming economic crisis will wipe out many Americans because they will never even see it coming. But that does not have to happen to you.

If you work really hard right now to prepare your family for the storm that is on the horizon, then you will have a much better chance of making it through to the other side.

11 International Agreements That Are Nails In The Coffin Of The Petrodollar

Is the petrodollar dead? Well, not yet, but the nails are being hammered into the coffin even as you read this. For decades, most of the nations of the world have used the U.S. dollar to buy oil and to trade with each other. In essence, the U.S. dollar has been acting as a true global currency. Virtually every country on the face of the earth has needed big piles of U.S. dollars for international trade. This has ensured a huge demand for U.S. dollars and U.S. government debt. This demand for dollars has kept prices and interest rates low, and it has given the U.S. government an incredible amount of power and leverage around the globe. Right now, U.S. dollars make up more than 60 percent of all foreign currency reserves in the world. But times are changing. Over the past couple of years there has been a whole bunch of international agreements that have made the U.S. dollar less important in international trade. The mainstream media in the United States has been strangely quiet about all of these agreements, but the truth is that they are setting the stage for a fundamental shift in the way that trade is conducted around the globe. When the petrodollar dies, it is going to have an absolutely devastating impact on the U.S. economy. Sadly, most Americans are totally clueless regarding what is about to happen to the dollar.

One of the reasons the Federal Reserve has been able to get away with flooding the financial system with U.S. dollars is because the rest of the world has been soaking a lot of those dollars up. The rest of the world has needed giant piles of dollars to trade with, but what is going to happen when they don’t need dollars anymore?

Could we see a tsunami of inflation as demand for the dollar plummets like a rock?

The power of the U.S. dollar has been one of the few things holding up our economy. Once that leg gets kicked out from under us we are going to be in a whole lot of trouble.

The following are 11 international agreements that are nails in the coffin of the petrodollar….

#1 China And Russia

China and Russia have decided to start using their own currencies when trading with each other. The following is from a China Daily article about this important agreement….

China and Russia have decided to renounce the US dollar and resort to using their own currencies for bilateral trade, Premier Wen Jiabao and his Russian counterpart Vladimir Putin announced late on Tuesday.

Chinese experts said the move reflected closer relations between Beijing and Moscow and is not aimed at challenging the dollar, but to protect their domestic economies.

“About trade settlement, we have decided to use our own currencies,” Putin said at a joint news conference with Wen in St. Petersburg.

The two countries were accustomed to using other currencies, especially the dollar, for bilateral trade. Since the financial crisis, however, high-ranking officials on both sides began to explore other possibilities.

#2 China And Brazil

Did you know that Brazil conducts more trade with China than with anyone else?

The largest economy in South America has just agreed to a huge currency swap deal with the largest economy in Asia. The following is from a recent BBC article….

China and Brazil have agreed a currency swap deal in a bid to safeguard against any global financial crisis and strengthen their trade ties.

It will allow their respective central banks to exchange local currencies worth up to 60bn reais or 190bn yuan ($30bn; £19bn).

The amount can be used to shore up reserves in times of crisis or put towards boosting bilateral trade.

#3 China And Australia

Did you know that Australia conducts more trade with China than with anyone else?

Australia also recently agreed to a huge currency swap deal with China. The following is from a recent Financial Express article….

The central banks of China and Australia signed a A$30 billion ($31.2 billion) currency-swap agreement to ensure the availability of capital between the trading partners, the Reserve Bank of Australia said.

“The main purposes of the swap agreement are to support trade and investment between Australia and China, particularly in local-currency terms, and to strengthen bilateral financial cooperation,” the RBA said in a statement on its website. “The agreement reflects the increasing opportunities available to settle trade between the two countries in Chinese renminbi and to make RMB-denominated investments.”

China has been expanding currency-swap accords as it promotes the international use of the yuan, and the accord with Australia follows similar deals with nations including South Korea, Turkey and Kazakhstan. China is Australia’s biggest trading partner and accounts for about a quarter of the nation’s merchandise sales abroad.

#4 China And Japan

The second and third largest economies on the entire planet have decided that they should start moving toward using their own currencies when trading with each other. This agreement was incredibly important but it was almost totally ignored by the U.S. media.

According to Bloomberg, it is anticipated that this agreement will strengthen ties between these two Asian giants….

Japan and China will promote direct trading of the yen and yuan without using dollars and will encourage the development of a market for companies involved in the exchanges, the Japanese government said.

Japan will also apply to buy Chinese bonds next year, allowing the investment of renminbi that leaves China during the transactions, the Japanese government said in a statement after a meeting between Prime Minister Yoshihiko Noda and Chinese Premier Wen Jiabao in Beijing yesterday. Encouraging direct yen- yuan settlement should reduce currency risks and trading costs, the Japanese and Chinese governments said.

China is Japan’s biggest trading partner with 26.5 trillion yen ($340 billion) in two-way transactions last year, from 9.2 trillion yen a decade earlier.

#5 India And Japan

It is not just China making these kinds of currency agreements. According to Reuters, India and Japan have also agreed to a very large currency swap deal….

India and Japan have agreed to a $15 billion currency swap line, Japan’s Prime Minister Yoshihiko Noda said on Wednesday, in a positive move for the troubled Indian rupee, Asia’s worst-performing currency this year.

#6 “Junk For Oil”: How India And China Are Buying Oil From Iran

Iran is still selling lots of oil. They just aren’t exchanging that oil for U.S. dollars as much these days.

So how is Iran selling their oil without using dollars?

A Bloomberg article recently detailed what countries such as China and India are exchanging for Iranian oil….

Iran and its leading oil buyers, China and India, are finding ways to skirt U.S. and European Union financial sanctions on the Islamic republic by agreeing to trade oil for local currencies and goods including wheat, soybean meal and consumer products.

India, the second-biggest importer of Iran’s oil, has set up a rupee account at a state-owned bank to settle as much as much as 45 percent of its bill, according to Indian officials. China, Iran’s largest oil customer, already settles some of its oil debts through barter, Mahmoud Bahmani, Iran’s central bank governor, said Feb. 28. Iran also has sought to trade oil for wheat from Pakistan and Russia, according to media reports from the two countries.

#7 Iran And Russia

According to Bloomberg, Iran and Russia have decided to discard the U.S. dollar and use their own currencies when trading with each other….

Iran and Russia replaced the U.S. dollar with their national currencies in bilateral trade, Iran’s state-run Fars news agency reported, citing Seyed Reza Sajjadi, the Iranian ambassador in Moscow.

The proposal to switch to the ruble and the rial was raised by Russian President Dmitry Medvedev at a meeting with his Iranian counterpart, Mahmoud Ahmadinejad, in Astana, Kazakhstan, of the Shanghai Cooperation Organization, the ambassador said.

#8 China And Chile

China and Chile recently signed a new agreement that will dramatically expand trade between the two nations and that is also likely to lead to significant currency swaps between the two countries….

The following is from a recent report that described this new agreement between China and Chile….

Wen called on the two nations to expand trade in goods, promote trade in services and mutual investment, and double bilateral trade in three years.

The Chinese leader also said the two countries should enhance cooperation in mining, expand farm product trade, and promote cooperation in farm product production and processing and agricultural technology.

China would like to be actively engaged in Chile’s infrastructure construction and work with Chile to promote the development of transportation networks in Latin America, said Wen.

Meanwhile, Wen suggested that the two sides launch currency swaps and expand settlement in China’s renminbi.

#9 China And The United Arab Emirates

According to CNN, China and the United Arab Emirates recently agreed to a very large currency swap deal….

In January, Chinese Premier Wen Jiabao visited the United Arab Emirates and signed a $5.5 billion currency swap deal to boost trade and investments between the two countries.

#10 China And Africa

Did you know that China is now Africa’s biggest trading partner?

For many years the U.S. dollar was dominant in Africa, but now that is changing. A report from Africa’s largest bank, Standard Bank, says the following….

“We expect at least $100 billion (about R768 billion) in Sino-African trade – more than the total bilateral trade between China and Africa in 2010 – to be settled in the renminbi by 2015.”

#11 Brazil, Russia, India, China And South Africa

The BRICS (Brazil, Russia, India, China and South Africa) continue to become a larger factor in the global economy.

A recent agreement between those nations sets the stage for them to increasingly use their own national currencies when trading with each other rather than the U.S. dollar. The following is from a news source in India….

The five major emerging economies of BRICS — Brazil, Russia, India, China and South Africa — are set to inject greater economic momentum into their grouping by signing two pacts for promoting intra-BRICS trade at the fourth summit of their leaders here Thursday.

The two agreements that will enable credit facility in local currency for businesses of BRICS countries will be signed in the presence of the leaders of the five countries, Sudhir Vyas, secretary (economic relations) in the external affairs ministry, told reporters here.

The pacts are expected to scale up intra-BRICS trade which has been growing at the rate of 28 percent over the last few years, but at $230 billion, remains much below the potential of the five economic powerhouses.

So what does all of this mean?

It means that the days of the U.S. dollar being the de facto reserve currency of the world are numbered.

So why is this important?

In a previous article, I quoted an outstanding article by Marin Katusa that detailed many of the important benefits that the petrodollar system has had for the U.S. economy….

The “petrodollar” system was a brilliant political and economic move. It forced the world’s oil money to flow through the US Federal Reserve, creating ever-growing international demand for both US dollars and US debt, while essentially letting the US pretty much own the world’s oil for free, since oil’s value is denominated in a currency that America controls and prints. The petrodollar system spread beyond oil: the majority of international trade is done in US dollars. That means that from Russia to China, Brazil to South Korea, every country aims to maximize the US-dollar surplus garnered from its export trade to buy oil.

The US has reaped many rewards. As oil usage increased in the 1980s, demand for the US dollar rose with it, lifting the US economy to new heights. But even without economic success at home the US dollar would have soared, because the petrodollar system created consistent international demand for US dollars, which in turn gained in value. A strong US dollar allowed Americans to buy imported goods at a massive discount – the petrodollar system essentially creating a subsidy for US consumers at the expense of the rest of the world. Here, finally, the US hit on a downside: The availability of cheap imports hit the US manufacturing industry hard, and the disappearance of manufacturing jobs remains one of the biggest challenges in resurrecting the US economy today.

So what happens when the petrodollar dies?

The following are some of the things we are likely to see….

-Oil will cost a lot more.

-Everything will cost a lot more.

-There will be a lot less foreign demand for U.S. government debt.

-Interest rates on U.S. government debt will rise.

-Interest rates on just about everything in the U.S. economy will rise.

And that is just for starters.

As I wrote about earlier today, the Federal Reserve is not going to save us. Ben Bernanke is not somehow going to pull a rabbit out of a hat that will magically make everything okay. Fundamental changes to the global financial system are happening right now that are impossible for Bernanke to stop.

We should have never gone into so much debt. Up until now we have gotten away with it, but when demand for U.S. dollars and U.S. debt dries up we are going to experience a massive amount of pain.

Keep your eyes and ears open for more news stories like the ones referenced above. The end of the petrodollar is going to be a very significant landmark on the road toward the total collapse of the U.S. economy.

So what do you think the fate of the U.S. dollar is going to be in the years ahead?

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

There Will Never Be Enough Jobs In America Again

Well, we just had another bad jobs report. The U.S. economy created just 80,000 new jobs during the month of June. Normally, about 125,000 new jobs need to be created every month just to keep up with population growth. So it is a bit odd that the official unemployment rate did not rise above 8.2%. What is even more alarming is that the Social Security Administration is telling us that 85,000 U.S. workers “left the workforce” and enrolled in the Social Security Disability Insurance program during the month of June. That means that the number of Americans enrolling in Social Security Disability actually exceeded the number of new jobs that was created. That is definitely not a sign of recovery. Unfortunately, this is about as good as things are going to get. Right now corporate profits are at an all-time high and usually after a recession has ended the percentage of working age Americans that have jobs bounces back very strongly. But that has not happened this time, and when the next economic crisis hits things are going to get a lot worse.

The headline to this article states that there will never be enough jobs in America again.

How could that possibly be true?

Well, the sad truth is that it is very hard to make a profit on an employee in the United States today.

Every year, the control freaks that run things just keep dumping more taxes, more laws, more regulations and more demands on employers. Hiring even a low level employee today is very complicated and very expensive.

These days a lot of small business owners have decided that it is simply not worth the hassle to hire more employees. If you can’t make a profit on them, what is the point?

If there was going to be a major rebound in hiring, we would have seen it by now. Corporate profits are at an all-time high as I mentioned earlier. How much more money do they need to make before they start hiring?

But I don’t blame them. Our politicians have loaded the system with plenty of incentives NOT to hire workers.

Yesterday, I wrote about how Barack Obama has been a one man wrecking crew when it comes to killing jobs. But he is not the only one to blame. The truth is that politicians from both political parties have been making things more difficult for employers for decades.

Today, many employers are trying to replace as many employees as possible with computers, automation, robotics and other forms of technology. Those are jobs that are not ever going to come back.

However, sometimes human labor is still actually needed.

But instead of hiring American workers, many big corporations are taking advantage of the emerging “one world economy” and are setting up shop in countries where it is legal to pay slave labor wages.

So how are American workers supposed to compete with that?

The truth is that they can’t.

Today, you aren’t just competing for jobs with your neighbors. Your competition also includes millions upon millions of hard working people on the other side of the globe that will gladly work 12 hour shifts in nightmarish conditions for a dollar an hour.

The United States has been losing millions of jobs to lower wage countries, and the fierce competition for the jobs that remain is driving down wages in this country.

As a result, many of our greatest cities that were once the envy of the entire world have become cesspools of filth, decay and wretchedness.

We are going to continue to bleed jobs because both major political parties are fully convinced that merging our labor pool with the labor pool of the rest of the world is a grand idea.

Republicans have been brainwashed into believing that a one world economic system is actually “conservative”. They have been told that it is “conservative” to merge our economy with countries ruled by third world dictators and brutal communist regimes that have no respect for human rights at all.

Democrats have been brainwashed into believing that merging our economy into a one world economic system is “good for American workers” and will bring more prosperity to this country.

Barack Obama is even negotiating a treaty right now that would reportedly ban all “Buy American” laws.

How stupid can we be?

If we merge our labor pool with the labor pool of the rest of the world with no protection, guess where our wages and our standard of living is going to go?

The answer is obvious.

The “giant sucking sound” that Ross Perot warned us about so many years ago has become a reality.

It is just basic economics.

If I go to the store and I see two similar products and one is priced at $10 and the other is priced at $100 I am going to go for the one priced $10.

Well, it is the same thing with employees.

U.S. workers can’t compare with low wage workers on the other side of the world. It is simply no contest.

Meanwhile, our control freak politicians continue to shove more jobs out the door by piling on even more taxes, rules and regulations.

Unfortunately, these trends are not going to change. It doesn’t matter who gets elected. The bleeding of jobs is going to continue.

In fact, we should probably be celebrating that things are still as good as they are.

In the future they will be a whole lot worse.

The period we are in right now was supposed to be the recovery. During the last recession the percentage of working age Americans with jobs fell dramatically. Since the end of the recession, that number has stayed remarkably flat….

Now the next major downturn is rapidly approaching.

When it hits, the unemployment rate is going to go well up into the double digits.

At the moment, our failing economy is being propped up by unprecedented amounts of debt.

When our debt-fueled false prosperity ends, the true horror of the decay of our economic system will be revealed.

If you think it is hard to find a job now, you just wait. What is coming is going to be a total nightmare. As I have written about before, many years of pain are ahead.

But that doesn’t mean that you have to lose hope.

On my website, people often share how their lives have been absolutely devastated by this economy. Some of them are even so down that they are considering giving up completely.

But that is the exact wrong response to all of this!

The reason why I try so hard to explain what is coming is so that it will not be a surprise to people. If you make plans and preparations now, the times that are coming will not overwhelm you. I believe that there will be people that will be greatly blessed even in the midst of what is coming.

However, millions of Americans that are not listening to the warnings now will have their lives totally destroyed by what is coming.

The world is changing. Nothing is going to stop that. The unprecedented prosperity that we have been rolling in is going to shrivel up and go away.

But that does not mean that your life is over.

In fact, if you get yourself physically and mentally prepared for what is ahead the times that are coming can be the greatest times of your life.

One of my goals is to give people hope. There is hope in understanding what is coming. There is hope in being prepared. There is hope in being a light in the middle of the darkness. There is hope in being willing to love people in the midst of a world that is going crazy. The following is from a comment that one reader left on a recent article….

I wanted to thank you, the author of this article, whoever you are. I haven’t completely ruled out killing myself but you’ve certainly given me something to think about. And thank you for trying to give people like me a little hope. A little kindness, even if only through words, is at a premium these days especially in my life. I will think carefully about what you’ve said. Best wishes to you and your efforts. God bless.

Everyone out there that is in a similar position – please do not ever, ever, ever give up.

No matter how bad things look right now, there are people out there that care.

One thing I have learned in life is this – there is always a way that things can be turned around.

Sadly, in the future a lot of Americans are going to give in to despair and will completely give up on life. We saw it happen during the Great Depression of the 1930s and we are seeing this in Greece and other European countries right now.

But the truth is that your life is not over no matter how bad things get out there.

You can let the times that are coming destroy you, or you can make them the greatest adventure of your life.

The choice is up to you.

I urge you to get ready, to get more independent of the system and to start focusing on the things that really matter in life.

Is Wal-Mart Destroying America? Facts About Wal-Mart That Will Absolutely Shock You

America absolutely loves Wal-Mart. 100 million customers visit Wal-Mart every single week in this country. But is Wal-Mart good for America? That is a question that most people never stop and ask. Most of us love shopping in big, clean stores that are packed with super cheap merchandise, but the truth is that Wal-Mart is destroying America in a lot of ways. As you will see below, Wal-Mart has destroyed tens of thousands of small businesses and countless manufacturing jobs over the past couple of decades. Wal-Mart has become a gigantic retail behemoth that sells five times more stuff than any other retailer in the United States. Unfortunately, a large percentage of all the stuff sold at Wal-Mart is made overseas. What that is costing the U.S. economy in terms of lost jobs and lost revenue is incalculable. But Wal-Mart is a perfect example of where our economic system is headed. Our economy is becoming completely and totally dominated by highly centralized monolithic predator corporations that ruthlessly crush all competition and that will stoop to just about anything in order to cut costs. In the future, will we all be working for gigantic communal entities that funnel all of the wealth and economic rewards to a very tiny elite? That sounds very much like how communist China works, and red-blooded Americans should want no part of that. America is supposed to be about free enterprise and competition and working together to build up this country, and Wal-Mart is destroying all of that.

The following are 20 facts about Wal-Mart that will absolutely shock you….

#1 The average U.S. family now spends more than $4000 a year at Wal-Mart.

#2 In 2010, Wal-Mart had revenues of 421 billion dollars. That amount was greater than the GDP of 170 different countries including Norway, Venezuela and the United Arab Emirates.

#3 If Wal-Mart was a nation, it would have the 23rd largest GDP in the world.

#4 Wal-Mart now sells more groceries than anyone else in America does. In the United States today, one out of every four grocery dollars is spent at Wal-Mart.

#5 Amazingly, 100 million customers shop at Wal-Mart every single week.

#6 Wal-Mart has opened more than 1,100 “supercenters” since 2005 alone.

#7 Today, Wal-Mart has more than 2 million employees.

#8 If Wal-Mart was an army, it would be the second largest military on the planet behind China.

#9 Wal-Mart is the largest employer in 25 different U.S. states.

#10 According to the Economic Policy Institute, trade between Wal-Mart and China resulted in the loss of 133,000 manufacturing jobs in the United States between 2001 and 2006.

#11 The CEO of Wal-Mart makes more in a single hour than a full-time Wal-Mart associate makes in an entire year.

#12 Tens of thousands of Wal-Mart employees and their children are enrolled in Medicaid and are dependent on the government for healthcare.

#13 Between 2001 and 2007, the value of products that Wal-Mart imported from China grew from $9 billion to $27 billion.

#14 Amazingly, 96 percent of all Americans now live within 20 miles of a Wal-Mart.

#15 The number of “independent retailers” in the United States declined by 60,000 between 1992 and 2007.

#16 According to the Center for Responsive Politics, Wal-Mart spent 7.8 million dollars on political lobbying during 2011. That number does not even include campaign contributions.

#17 Today, Wal-Mart has five times the sales of the second largest U.S. retailer (Costco).

#18 The combined net worth of six members of the Walton family is roughly equal to the combined net worth of the poorest 30 percent of all Americans.

All over the country, independent retailers are going out of business because they cannot compete with Wal-Mart and their super cheap Chinese products. Often communities will give Wal-Mart huge tax breaks just to move in to their areas. But what many communities don’t take into account is that the introduction of a Wal-Mart is often absolutely devastating to small businesses….

A study of small and rural towns in Iowa showed lost sales for local businesses ranging from -17.2% in small towns to -61.4% in rural areas, amounting to a total dollar loss of $2.46 BILLION over a 13-year period.

When we buy stuff made by people working for slave labor wages in China, we destroy good paying American jobs and we make America poorer. This is a point that I have tried to make over and over.

Wal-Mart often tells one thing to the public and then does another thing in private. Sadly, the truth is that Wal-Mart does not care about U.S. manufacturing jobs. Wal-Mart just wants to get products as cheaply as they possibly can, and most of the time that means getting them from China.

Just check out this first-hand testimony from an 81-year-old retired apparel manufacturer….

I was president of the Southwestern Apparel Manufacturers Association. There was a meeting sometime between 1985 and 1990. Walmart had contacted our organization and asked if they could meet with us at our beautiful Apparel Mart we had here in Dallas, which has now been razed, because all the independent merchants don’t exist that used to come to it. Two people from Walmart came down and they said they were going to be sourcing goods from overseas and we would have to meet those prices for consumer products and to get ready for it—we are going to be sourcing the world. Walmart was the only company that came out and said this.

It was sort of shocking: I was selling them some merchandise at the time. On the back of their trucks it was saying “Bring it Back to America!” They had the big “keep it in America” program going at that time on the big signs in the stores. Meanwhile when I reminded the buyer of that, she told me, “that is just for domestic consumption, we’re going to buy at the cheapest we can anywhere on earth.”

As I have written about previously, the United States has lost more than 56,000 manufacturing facilities since 2001.

We are losing millions of good jobs that cannot be replaced. If you can believe it, the United States has actually lost an average of about 50,000 manufacturing jobs a month since China joined the World Trade Organization in 2001.

Last year, the U.S. trade deficit with China was the biggest trade deficit that one nation has had with another nation in the history of the world, and Wal-Mart played a huge role in that.

In fact, Wal-Mart has actually been forcing some U.S. manufacturers to pack up and move overseas. The following is from a recent article by Amy Traub….

Walmart’s market power is so immense that the even the largest suppliers must comply with its demands for lower and lower prices because they cannot afford to have their goods taken off its shelves. Companies that used to manufacture products in the United States, from Levi’s jeans to lock maker Master Lock, were pressured to shut their U.S. factories and moved manufacturing abroad to meet Walmart’s demand for low prices.

Unfortunately, the vast wealth that Wal-Mart is sucking out of our communities is not put back into our communities. The profits are funneled out to Wal-Mart executives and shareholders. We may enjoy the low prices, but very little of the money that we give to Wal-Mart gets recycled in our local areas.

In the old days, you could actually support a family selling electronics or running a general store. But you can’t support a family working at Wal-Mart. The vast majority of the jobs that Wal-Mart creates are very low paying. Large numbers of Wal-Mart employees are actually on welfare, and this is part of the reason why we have seen such an explosion in the number of the working poor in America.

At this point, more than 40 percent of all jobs in America are low wage jobs and the middle class is rapidly disappearing.

If we do not support American jobs and American manufacturers they will continue to go away and the welfare rolls in this country will continue to explode.

There is not going to be any prosperity in this country without jobs. Unfortunately, most Americans simply do not understand how good jobs are being systematically destroyed in America every single day.

The path that America is headed on today is only going to end in complete and total disaster. We are being transformed from a wealthy nation into a poor nation. In the end, we will be dominated by a very tiny elite and everyone else will either be among the working poor or will be totally dependent on the government.

Our system is supposed to be about open, honest competition. But that is not what Wal-Mart is about. Wal-Mart is about crushing small businesses and manufacturers here in America and getting us all to buy their super cheap Chinese-made goods.

So what do all of you think about Wal-Mart? Please feel free to post a comment with your thoughts below….

The Bad Jobs Report Is Just A Very Small Taste Of The Economic Nightmare That Is Coming

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.

What Raoul Pal is saying lines up very well with what Steve Quayle’s anonymous international banking source is telling him….

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.

You better get ready.

Is Obama Negotiating A Treaty That Would Essentially Ban All “Buy American” Laws?

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.

The truth is that the “free trade” agenda of globalists such as Barack Obama is absolutely devastating our economy.

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….

1) 35 Facts About The Gutting Of America’s Industrial Might That Should Make You Very Angry

2) 47 Signs That China Is Absolutely Destroying America On The Global Economic Stage

3) America Is Being Transformed From A Wealthy Nation Into A Poor Nation At Breathtaking Speed

4) 17 Facts About The Decline Of The U.S. Auto Industry That Are Almost Too Crazy To Believe

5) If You Are A Blue Collar Worker In America You Are An Endangered Species

6) The Worst In The World – The U.S. Balance Of Trade Is Mind-Blowingly Bad

7) Free Trade Or Fair Trade? 20 Reasons Why All Americans Should Be Against The Insane Trade Policies Of The Globalists

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.

Sadly, thousands upon thousands more good jobs are being lost each and every month.

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….

95 Percent Of The Jobs Lost During The Recession Were Middle Class Jobs

Who is the biggest loser in the ongoing decline of the U.S. economy? Is it the wealthy? No, the stock market has been soaring lately and their incomes are actually going up. Is it the poor? Well, the poor are definitely hurting very badly, but when you don’t have much to begin with you don’t have much to lose. Unfortunately, it is the middle class that has lost the most during this economic downturn. According to Bloomberg, 95 percent of the jobs lost during the recession were middle class jobs. That is an absolutely astounding figure. Yes, some executives lost their jobs during the last recession as did some minimum-wage workers. But overwhelmingly the jobs that were lost were middle income jobs. Sadly, the limited number of jobs that have been added since the end of the last recession have mostly been low income jobs. A higher percentage of Americans are working low income jobs than ever before, and the cost of living continues to rise at a very brisk pace. This is causing an erosion of the middle class unlike anything we have ever seen in American history.

When I was growing up I was taught that the fact that we had the largest middle class in the history of the world was evidence that our economic system was working incredibly well.

So what does the fact that the middle class is shrinking at a very rapid pace at this point say about how well our economy is working?

Middle Class Incomes Are Going Down

During the last recession, millions of Americans lost their jobs and the percentage of working age Americans that have jobs has not bounced back in the years since the recession ended.

But most middle class Americans still have jobs. The big problem for many middle class families is the fact that their incomes are not going up. In fact, after you account for inflation, middle class incomes are actually way down during the Obama years as a recent Bloomberg article explained….

As a candidate in 2008, Obama blamed the reversals largely on the policies of Bush and other Republicans. He cited census figures showing that median income for working-age households — those headed by someone younger than 65 — had dropped more than $2,000 after inflation during the first seven years of Bush’s time in office.

Yet real median household income in March was down $4,300 since Obama took office in January 2009 and down $2,900 since the June 2009 start of the economic recovery, according to an analysis of census data by Sentier Research, an economic- consulting firm in Annapolis, Maryland.

So is this the “hope and change” that Obama was talking about?

But let’s not just blame Obama and Bush. The truth is that the trend toward lower paying jobs has been going on for a very long time.

Back in 1980, less than 30% of all jobs in the United States were low income jobs. Today, more than 40% of all jobs in the United States are low income jobs.

So where will it end?

Will 50 percent or 60 percent of all Americans soon be working low income jobs?

At this point, approximately one out of every four jobs in America pays $10 an hour or less.

Could your family survive on $10 an hour?

The Rising Cost Of Living

As middle class incomes go down, the cost of almost everything that middle class families buy continues to go up.

The Federal Reserve claims that it has kept inflation “low” for decades, but that is a giant lie.

When you take a look at the long-term picture, it is amazing how much prices have changed.

Back in 1950, the average price of a new car was $1,510.

Today, the average price of a new car is $30,748.

In 1967, yearly tuition at Yale was $1,950.

Today it is $38,300.

And inflation continues to take a great toll on the paychecks of middle class families.

For example, electricity bills in the U.S. have risen faster than the overall rate of inflation for five years in a row.

Also, the price of gas has risen by more than 100 percent since Barack Obama entered the White House and the average U.S. household spent a staggering $4,155 on gasoline during 2011.

The Destruction Of Middle Class Wealth

What is the number one financial asset for most middle class families?

Most middle class families don’t have a lot of stocks, bonds or other financial assets.

Instead, normally the family home is the number one financial asset for most middle class families, and in recent years the value of that asset has been absolutely decimated.

When you take inflation into account, housing prices have fallen all the way back to 1998 levels. The following is from a recent Smart Money article….

The latest S&P / Case-Shiller numbers, reported last week, show that prices in 20 major markets declined 3.5% over the year through February. They’re now back to 2002 levels. If we subtract for inflation, they’re back to 1998 levels.

Overall, home prices in the U.S. have declined for six months in a row and are now down a total of 35 percent from the peak of the housing bubble.

Unfortunately, things don’t look like they are going to turn around any time soon. Yale economics professor Robert Shiller recently said the following about U.S. home prices….

“I worry that we might not see a really major turnaround in our lifetimes”

But falling home prices are not the only problem we are witnessing. We are also seeing millions of middle class families lose their homes.

According to the U.S. Census, homeownership in America is now at the lowest level it has been in 15 years.

According to Gallup, the current level of homeownership in the United States is the lowest that Gallup has ever measured.

Owning your own home is an indication that you are part of the middle class, and so the fact that the number of Americans that own a home is falling rapidly is not a good sign for the health of the middle class at all.

The Future Is Not Bright

Those that are graduating from college right now are supposed to be the future of the middle class in America.

But for most of those college graduates, the future is not so bright. Last year, a staggering 53 percent of all U.S. college graduates under the age of 25 were either unemployed or underemployed.

Millions of young college graduates have been forced to take jobs that do not even require a college degree. Just check out the following stats from a recent CNBC article….

In the last year, they were more likely to be employed as waiters, waitresses, bartenders and food-service helpers than as engineers, physicists, chemists and mathematicians combined (100,000 versus 90,000). There were more working in office-related jobs such as receptionist or payroll clerk than in all computer professional jobs (163,000 versus 100,000).

Aren’t those numbers crazy?

The truth is that a college education is no longer a ticket to the middle class.

What Happens To Americans That Fall Out Of The Middle Class?

As the middle class shrinks, the ranks of the “low income” and “the poor” are absolutely swelling.

Today, approximately 48 percent of all Americans are either considered to be “low income” or are living in poverty.

That is almost half the country.

Each year, millions more fall out of the middle class. In 2010, 2.6 million more Americans fell into poverty. That was the biggest increase that we have seen since the U.S. government began keeping statistics on this back in 1959.

As the middle class shrinks, the number of Americans dependent on the government for survival rises. Right now, government dependence is at an all-time high and things are only going to get worse from here.

In November 2008 (when Barack Obama won the election), 30.8 million Americans were on food stamps. Today, more than 46 million Americans are on food stamps.

Will we eventually see 50 million or 60 million Americans on food stamps?

The U.S. economy desperately needs more middle class jobs.

Unfortunately, the Republicans failed to generate them under George W. Bush and the Democrats failed to generate them under Barack Obama.

Instead, both parties continue to promote the politics of division and they both continue to push for more of the same policies that got us into this mess in the first place.

Nothing is being done to solve our problems and so the middle class in America is going to be even smaller by this time next year.

If you still have a spot in the middle class, hold on to it as tightly as you can. It is not as secure as you might think.