Now They Are Telling Us That Life In America Will Definitely Not Be Returning To Normal “For The Foreseeable Future”

If you thought that this pandemic would pass quickly and that life in America would soon return to “normal”, I am afraid that you are in for quite a shock.  Some of the restrictions currently in place will eventually be lifted, and efforts will be made to get people back to work, but life is still going to be radically different from what we had become accustomed to before COVID-19 started sweeping across the globe.  Authorities are telling us that there may be “rolling shutdowns” for up to 18 months, that social distancing guidelines will be necessary for a long time to come, and that this crisis will not ultimately be resolved until they can inject everyone with a vaccine.  If all of this greatly alarms you, please be assured that you are not alone.

In recent days there has been a tremendous amount of debate about when to “reopen the U.S. economy”, and organizations all along the political spectrum have drafted plans for how to do that.

Ezra Klein actually read quite a few of those plans, and he discovered that none of them would return our lives to normal “for the foreseeable future”

Over the past few days, I’ve been reading the major plans for what comes after social distancing. You can read them, too. There’s one from the right-leaning American Enterprise Institute, the left-leaning Center for American Progress, Harvard University’s Safra Center for Ethics, and Nobel Prize-winning economist Paul Romer.

I thought, perhaps naively, that reading them would be a comfort — at least then I’d be able to imagine the path back to normal. But it wasn’t. In different ways, all these plans say the same thing: Even if you can imagine the herculean political, social, and economic changes necessary to manage our way through this crisis effectively, there is no normal for the foreseeable future. Until there’s a vaccine, the United States either needs economically ruinous levels of social distancing, a digital surveillance state of shocking size and scope, or a mass testing apparatus of even more shocking size and intrusiveness.

Over and over again, a “vaccine” is being touted as the golden ticket that will get us out of this mess.

The head of the Federal Reserve Bank of Minneapolis, Neel Kashkari, is another prominent voice that is warning that there won’t be a return to normalcy until a vaccine comes along.  And until that time comes, he believes that we are potentially facing “an 18-month strategy of rolling shutdowns”

Kashkari, while acknowledging the downside of what a prolonged shutdown could mean for the economy, said the U.S., “barring some health-care miracle,” is looking at an 18-month strategy of rolling shutdowns based on what has happened in other countries.

“We could have these waves of flare-ups, controls, flare-ups and controls, until we actually get a therapy or a vaccine,” he said. “We need to find ways of getting the people who are healthy, who are at lower risk, back to work and then providing the assistance to those who are most at risk, who are going to need to be quarantined or isolated for the foreseeable future.”

In other words, Kashkari believes that all or part of the nation will be shut down over and over again whenever the number of coronavirus cases starts to spike too high.

Of course the WHO is eagerly looking forward to global vaccination as well, and the head of the WHO just told the media that he believes that this virus is ten times deadlier than the swine flu pandemic of 2009…

Coronavirus is ten times deadlier than the 2009 swine flu pandemic and a vaccine will be needed to halt it, the World Health Organisation has said.

WHO chief Tedros Adhanom Ghebreyesus told a virtual briefing from Geneva the organisation was constantly learning about the bug sweeping the globe.

Over and over again, officials are telling us that we are facing an 18 month timeframe until a vaccine will be ready.  Just check out what New York Governor Andrew Cuomo said during his press conference earlier today…

On Monday, governor Cuomo was joined on a conference call by the other Northeast governors. The recovery must be careful, incremental and guided by experts rather than politics, Cuomo said, and the pandemic won’t be truly “over” until a vaccine is available, which could take as long as 18 months. Ideally, a plan would also involve widespread testing, he said, to allow those without the virus – and those who have recovered and may now be resistant to it – to return to work first.

By the time 18 months goes by, most of the general population will be so desperate to feel safe from this virus that they will race out to get the vaccine as fast as they possibly can.

And until then, we can expect economic conditions to steadily deteriorate.

Yes, hopefully most businesses in the country will be allowed to reopen in a matter of weeks, but that doesn’t mean that the customers will come back.

Prior to this pandemic, we were already witnessing the worst “retail apocalypse” in U.S. history, and now one research firm is warning that an all-time record 15,000 stores could be permanently shuttered in 2020

Coresight Research predicts that 15,000 U.S. stores will permanently close this year, setting a new record and nearly doubling its earlier forecast of 8,000 store closings.

‘Retail has hung a closed sign on the door literally and metaphorically,’ Neil Saunders, managing director of GlobalData Retail, said.

Pretty soon, our communities are going to be absolutely littered with abandoned buildings, and “space available” signs will start popping up everywhere.

Meanwhile, millions upon millions of U.S. consumers will be falling on very hard times.  We are in the midst of the greatest spike in unemployment in all of American history, and the number of people taking advantage of the federal government’s mortgage forbearance program has gone through the roof

With unemployment claims hitting nearly 17 million over the last three weeks, the number of Americans applying for the government’s mortgage forbearance program under the COVID-19 relief plan spiked 73% for the week ending April 5 vs. the previous week – jumping from 2.73% to 3.74%, according to new data from the Mortgage Bankers Association.

For context, the total number of loans in forbearance was just 0.25% for the week of March 2 – an increase of 1,496% in just six weeks, with the number of borrowers in forbearance now topping 2 million according to CNBC.

Realizing that we are on the verge of another massive wave of mortgage defaults, mortgage lenders all over the nation are rapidly tightening standards.  JPMorgan is just one example

Over the weekend our skepticism was confirmed when Reuters reported that JPMorgan, the country’s largest lender by assets and which will kick off earnings season tomorrow, will raise borrowing standards this week for most new home loans as the bank “moves to mitigate lending risk stemming from the novel coronavirus disruption.”

Starting Tuesday, customers applying for a new mortgage will need a credit score of at least 700, and will be required to make a down payment equal to 20% of the home’s value (something which we thought was the norm after the last financial crisis, but apparently lending conditions had eased quite a bit in the past decade).

For a very long time I have been warning that the flow of credit would get really tight when the next crisis hit.

Now we are here, and Americans are going to have a much harder time getting loans to buy homes, vehicles or anything else.

Everything that I have been warning about in my books is beginning to transpire, and a tremendous amount of pain is ahead.

My hope is that all of the pain that is ahead will cause a mass awakening and America will turn in a more positive direction.

But to most people, the immediate future looks really bleak right now, and that is not going to change any time soon.

About the Author: I am a voice crying out for change in a society that generally seems content to stay asleep. My name is Michael Snyder and I am the publisher of The Economic Collapse BlogEnd Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe. I have written four books that are available on Amazon.com including The Beginning Of The EndGet Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned) By purchasing those books you help to support my work. I always freely and happily allow others to republish my articles on their own websites, but due to government regulations I need those that republish my articles to include this “About the Author” section with each article. In order to comply with those government regulations, I need to tell you that the controversial opinions in this article are mine alone and do not necessarily reflect the views of the websites where my work is republished. The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions. Those responding to this article by making comments are solely responsible for their viewpoints, and those viewpoints do not necessarily represent the viewpoints of Michael Snyder or the operators of the websites where my work is republished. I encourage you to follow me on social media on Facebook and Twitter, and any way that you can share these articles with others is a great help.  During these very challenging times, people will need hope more than ever before, and it is our goal to share the gospel of Jesus Christ with all many people as we possibly can.

Deep Economic Suffering Has Erupted All Over America, But Guess Who The Federal Reserve Is Helping?

As millions upon millions of Americans lose their jobs in the greatest wave of unemployment in U.S. history, the Federal Reserve has decided that now is the time to spend trillions of newly created dollars in a desperate attempt to protect financial asset values.  In other words, as much of the country suddenly plunges into poverty, the Federal Reserve is working exceedingly hard to protect the wealth of the elite.  Approximately fifty percent of all stock market wealth is owned by the wealthiest one percent of all Americans, and the amount of stock market wealth owned by the poorest 50 percent of all Americans is so small that it really doesn’t matter.  And those running the Fed certainly understand that their reckless policies will create very painful inflation that will hit average American families extremely hard, but they don’t seem to care.  At this point, they figure that asset values must be protected at all costs, and that is going to continue to expand the absolutely massive gap between the rich and the poor in this country.

Over the past 3 weeks, more than 16 million Americans have filed new claims for unemployment benefits.

Prior to this year, the highest number that we had ever seen in any 3 week span in all of American history was about 2 million.

It is a collapse of unprecedented magnitude, and things have already gotten so bad that even “the Happiest Place on Earth” is conducting mass layoffs

Walt Disney World Resort will furlough 43,000 union workers while its theme parks remain closed as authorities restrict large gatherings due to the coronavirus pandemic, according to the Service Trades Council Union.

Because most U.S. workers live paycheck to paycheck, many of the newly unemployed have fallen on hard times very rapidly.  Food banks all over the nation are seeing an alarming surge in demand, and in many cities people are literally lining up before the sun rises in order to ensure that they will get some food

In many cities, lines outside food pantries have become glaring symbols of financial precarity, showing how quickly the pandemic has devastated working people’s finances.

In San Antonio, 10,000 families began arriving before dawn on Thursday at a now-shuttered swap meet hall to receive boxes of food. Normally, 200 to 400 families might show up during a normal food distribution.

For many other similar examples, please see my previous article entitled “America’s ‘Food Lines’ Are Being Measured In Miles As Desperation Sets In All Over The Country”.  Yes, things got bad during the last recession, but they were never as bad as we are witnessing now.  In fact, the CEO of Feeding America says that demand is already at the highest level that she has ever seen

‘I’ve never witnessed a system being more strained,’ Feeding America CEO Claire Babineaux-Fontenot said.

‘For the first time probably in our history, we’ve had to turn some people away,’ she said, not that ‘We don’t want to do that, ever.’

Unfortunately, this economic collapse is still in the very early chapters.  If you can believe it, JPMorgan is actually projecting that U.S. GDP “will fall by 40 percent” on an annualized basis during the second quarter

According to CNBC, JPMorgan economists are forecasting that the GDP will fall by 40 percent through the spring months. They also predict unemployment will reach 20 percent in April, with 25 million jobs lost overall.

Such a drop would be, by far, the worst in U.S. history. For context, according to Credit Suisse (via Business Insider), the worst quarterly drop of the 2008 crash was 8.4 percent.

And even once the “shelter-in-place” orders are finally lifted, that will not mean that things will go back to normal.  As Nobel-prize winning economist Robert Shiller has noted, fear of the coronavirus is going to cause many Americans to avoid restaurants, sporting events and other businesses where public interaction is required for a long time to come…

“The shortage of supplies is generating horrible news stories that put us all on edge,” said Shiller. “It may mean people won’t go to restaurants or sporting events in good numbers for years. You know the disease might not well be eradicated for several years from now.”

So the truth is that we are heading into a very deep economic depression, and the economic suffering in this country is going to be off the charts.

As events have begun to spiral out of control, the Federal Reserve has sprung into action on a scale unlike anything that we have ever seen before, and this has pushed the Fed’s balance sheet above 6 trillion dollars

The Federal Reserve’s balance sheet increased to a record $6.13 trillion this week as the central bank used its nearly unlimited buying power to soak up assets and keep markets functioning smoothly, even as efforts to contain the coronavirus pandemic cut deeply into employment and economic output.

In the four weeks since the Fed slashed interest rates to zero, restarted bond purchases and rolled out an unprecedented range of programs to limit the economic damage from the outbreak, the central bank’s balance sheet has jumped by about $1.7 trillion.

Let me try to put those numbers in perspective.

During QE3, the Fed’s balance sheet increased by 1.7 trillion dollars over the course of an entire year, and now the Fed has achieved that same feat in just four weeks.

What the Fed is doing is completely and utterly insane, but to a certain extent it is working.

Even though we are in the midst of the most dramatic unemployment spike in American history, last week was the best week for the stock market in decades thanks to the Fed.

Isn’t that nuts?

I know that this also sounds incredibly absurd, but last week’s surge actually pushed P/E values back near record highs.

In other words, stock prices are incredibly overvalued at this moment.

And if everything that we have already witnessed was not enough, on Thursday the Fed announced that it will now be spending trillions of dollars to voraciously buy up bonds of all types

The Federal Reserve is not leaving any corner of the U.S. bond market behind in this crisis.

There’s no other way to interpret the central bank’s sweeping measures announced Thursday, which together provide as much as $2.3 trillion in loans to support the economy. It will wade into the $3.9 trillion U.S. municipal-bond market to an unprecedented degree, can now purchase “fallen angel” bonds from companies that have recently lost their investment-grade ratings, and has expanded its Term Asset-Backed Securities Loan Facility to include top-rated commercial mortgage-backed securities and collateralized loan obligations.

In other words, moving forward we will no longer have a “bond market”.  What we will have is a Fed-manipulated sham in which the Fed picks winners and losers.

Of course many believe that it is only a matter of time before the Fed starts buying stocks as well.

Those that love free markets should be absolutely disgusted by all of this, because the Fed is coming up with lots of new ways to give handouts to the very wealthy.

Meanwhile, the poor are rapidly getting poorer.

But don’t worry too much, because you will soon receive your $1,200 socialist handout from the federal government.

Try not to spend it all in one place.

Needless to say, $1,200 won’t last very long in the hands of most Americans, and one recent survey found that “63% of respondents said they will need another check within the next three months”.

Like I warned from the very beginning, these sorts of direct payments set a very dangerous precedent, and if a Democrat wins the presidency in November they may become permanent.

That may sound really good to you, but what are you going to do when it gets to the point where you have to spend 500 dollars a week just to feed your family?

At that point many of you will also be lining up at the crack of dawn to receive whatever the food banks have available to give you

Outside of Pittsburgh, Danielle Small pulled up 90 minutes early to a food distribution, but found two long rows of cars already ahead of her. Money was getting tight after her boyfriend had to take a pay cut, and she decided to make her first trip to a food bank this week.

She said the line moved efficiently as cars pulled ahead in clusters of 10. After Ms. Small, 32, received a box filled with chicken fajita strips, preserved peaches, fruit, nuts and juice, she mouthed, “Thank you,” to the volunteers and drove away.

Millions of Americans driving nice vehicles and wearing nice clothes are suddenly being forced to spend hours waiting in food lines because fear of the coronavirus has crashed our economy.

A day of reckoning has finally arrived, and a lot more pain is on the way.

Sadly, many Americans will just go along with whatever “solutions” are proposed as long as it looks like they may provide short-term relief.  What remains of our free markets is being obliterated, Congress is openly embracing socialism, and our rights are being stripped away at a staggering rate, but most people don’t seem concerned by any of this.

Most people just want the pain to end and for life to go back to normal, but that is simply not going to happen.

About the Author: I am a voice crying out for change in a society that generally seems content to stay asleep. My name is Michael Snyder and I am the publisher of The Economic Collapse BlogEnd Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe. I have written four books that are available on Amazon.com including The Beginning Of The EndGet Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned) By purchasing those books you help to support my work. I always freely and happily allow others to republish my articles on their own websites, but due to government regulations I need those that republish my articles to include this “About the Author” section with each article. In order to comply with those government regulations, I need to tell you that the controversial opinions in this article are mine alone and do not necessarily reflect the views of the websites where my work is republished. The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions. Those responding to this article by making comments are solely responsible for their viewpoints, and those viewpoints do not necessarily represent the viewpoints of Michael Snyder or the operators of the websites where my work is republished. I encourage you to follow me on social media on Facebook and Twitter, and any way that you can share these articles with others is a great help.  During these very challenging times, people will need hope more than ever before, and it is our goal to share the gospel of Jesus Christ with all many people as we possibly can.

A Massive Surge Of Unemployment Like America Has Never Seen Before

The pace at which Americans are losing their jobs is absolutely breathtaking.  According to the Wall Street Journal, the largest number of new claims for unemployment benefits ever recorded in a single week prior to this year was 695,000 during the week that ended October 2nd, 1982.  So that means that what we are now witnessing is completely unprecedented.  About half the country is currently under some sort of a “shelter-in-place” order, and there has never been a nationwide shutdown of businesses anything like what we are currently experiencing.  Many are hoping that America will be able to “get back to normal” soon, but that all depends on the progression of this pandemic.  The number of newly confirmed cases in the U.S. spiked by more than 11,000 on Wednesday, and the number of new deaths continues to escalate at a very alarming rate.  Until those numbers start to improve, life is definitely not going to “get back to normal”.

In recent days, so many newly unemployed Americans have been trying to file for unemployment benefits that it has been crashing websites all over the country.  For example, a newly unemployed worker in Michigan named Aaron Garza never was able to file for benefits through Michigan’s unemployment website although he kept on trying throughout Monday and Tuesday

When Aaron Garza was dismissed this week from his job as a parts specialist at a Toyota dealership in Grand Rapids, Michigan, he joined a tidal wave of unemployed people swamping systems to help them and straining state finances to the breaking point.

On Monday, Garza went to Michigan’s unemployment website and tried logging on to apply for benefits electronically. After 30 minutes, he was able to sign on, but by the time a verification code was sent to his phone 25 minutes later, he had already given up. As of Tuesday afternoon, he still hadn’t been able to get through.

Last week, 108,000 workers filed for unemployment benefits in the state of Michigan.

That is 20 times more than normal.

Ouch.

In Louisiana, things are even worse.  If you can believe it, the number of people filing for unemployment benefits is more than 40 times higher than usual

In Louisiana alone, 71,000 people filed new unemployment applications last week, compared to the usual 1,400 or 1,500 people per week, said state labor secretary Ava Dejoie.

Louisiana has one of the highest per capita counts of coronavirus cases in the U.S. Democratic Gov. John Bel Edwards has ordered nonessential businesses to close, limited restaurants to takeout and delivery, banned gatherings over 10 people and directed residents to remain at home.

And in California, Governor Gavin Newsom says that a million residents of his state have filed for benefits “just since March 13”

California Gov. Gavin Newsom said Wednesday that the state has seen 1 million unemployment claims in less than two weeks as the coronavirus pandemic has led to businesses being shut down across the state.

“We just passed the 1 million mark, in terms of the number of claims, just since March 13,” Newsom said.

On Thursday, we will get the latest weekly total for the nation as a whole.

At this point nobody is quite sure what to expect, but most forecasts are ranging between one million and four million

Economists have issued widely varying estimates of Thursday’s jobless claims total based on anecdotal reports by about 40 states to news outlets for the first few days of last week. Goldman Sachs estimated the national count will be about 2.25 million but said it could be as low as slightly more than 1 million. Morgan Stanley reckons about 3.4 million. Oxford Economics says about 4 million.

If we even hit the lowest edge of that range, it will absolutely shatter the old record that was set back in 1982.

Of course similar things are happening all over the world.  Approximately one-third of the entire population of the globe is currently under some sort of a lockdown order, and that means that hundreds of millions of workers are sitting at home not working.

Here in the United States, so many people are already absolutely sick and tired of being idle at home, but the truth is that it looks like this pandemic is just getting started.

In fact, New York City Mayor Bill de Blasio believes that more than half of the residents of his city will eventually get the virus

More than half of New York City’s population can expect to be infected by the coronavirus, Mayor Bill de Blasio said. Most will suffer only a “mild experience,” but many will become very sick, and “we are going to lose some people,” he said. April will be tough and May tougher before the virus crisis eases, he said. The city has seen 192 deaths so far, and there are more than 17,000 confirmed cases of the virus.

“The world we knew is gone,” de Blasio said in a social media post. “And it’s not coming back, not for the next few months. That’s the blunt truth.”

If his projection is even close to accurate, that means that we are in for a very, very long battle with COVID-19.

A lot of people out there are still trying to downplay this pandemic, and that is a huge mistake.  The dead bodies are starting to pile up just like we saw in China, Iran and Italy, and already “New York City’s morgues are nearing capacity”

The Department of Homeland Security has been briefed that New York City’s morgues are nearing capacity, according to a department official and a second person familiar with the situation.

Officials were told that morgues in the city are expected to reach capacity next week, per the briefing. A third person familiar with the situation in New York said some of the city’s hospital morgues hit capacity in the past seven days. And a FEMA spokesperson told POLITICO that New York has asked for emergency mortuary assistance. Hawaii and North Carolina have asked for mortuary help as well, and the disaster response agency is currently reviewing the requests, according to the spokesperson.

You may have noticed that I have not said too much about what Congress is doing, and that is because any “stimulus package” is really not going to make that much of a difference.

Congress is not going to be able to make this pandemic go away, and they aren’t going to be able to convince people that are deathly afraid to leave their own homes to go out and spend money normally.

But thanks to Congress there will be a lot more money chasing a rapidly dwindling pool of goods and services in the days ahead, and that will eventually cause very painful inflation.

And if they are going to start handing out giant checks to everyone, they better keep on doing it all throughout this crisis.  Because as Gerald Celente has warned, what we are heading for is “the Greatest Depression”

“People are going to go bankrupt. You are going to see suicide rates increase. You are going to see crime escalate and people OD’ing on drugs because of depression…

Our leaders are totally closing down the economy. Again, this has never been done before. It’s not only Wall Street going down, Main Street went down simultaneously. That is unprecedented. Usually, the markets go down and then the ripple effects start hitting Main Street. This time–boom, they are both down…

It’s going to be worse than the Great Depression. It’s going to be the Greatest Depression.”

Sadly, one element of Celente’s warning is already coming to pass.  It is being reported that calls to the National Suicide Prevention Hotline have risen 300 percent

Isolation and anxiety over the coronavirus pandemic are taking a toll, with calls to a National Suicide Prevention Hotline call center rising 300 percent, KVLY reports.

Other suicide prevention services across the United States also have seen spikes in calls since the COVID-19 virus threw everyday life askew for millions.​​​​​

In this hour, people are going to need hope.

But trying to convince them that this virus does not exist is not giving them hope.

And those that are boldly proclaiming that this virus will magically go away very quickly are only giving people false hope.  When they later realize that they were lied to, that false hope will give way to even deeper depression and despair.

This virus is very real, and we are going to be battling this pandemic for an extended period of time.  But God knew all about this in advance, He is in control, and He will accomplish His purposes.

And God specifically has a plan for you and your family, but you have got to be willing to embrace it.  Your future is likely to look far different than you originally imagined, but with God’s help it can also be far greater than you originally imagined as well.

About the Author: I am a voice crying out for change in a society that generally seems content to stay asleep. My name is Michael Snyder and I am the publisher of The Economic Collapse BlogEnd Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe. I have written four books that are available on Amazon.com including The Beginning Of The EndGet Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned) By purchasing those books you help to support my work. I always freely and happily allow others to republish my articles on their own websites, but due to government regulations I need those that republish my articles to include this “About the Author” section with each article. In order to comply with those government regulations, I need to tell you that the controversial opinions in this article are mine alone and do not necessarily reflect the views of the websites where my work is republished. The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions. Those responding to this article by making comments are solely responsible for their viewpoints, and those viewpoints do not necessarily represent the viewpoints of Michael Snyder or the operators of the websites where my work is republished. I encourage you to follow me on social media on Facebook and Twitter, and any way that you can share these articles with others is a great help.  During these very challenging times, people will need hope more than ever before, and it is our goal to share the gospel of Jesus Christ with all many people as we possibly can.

Unemployment Claims Spike Again As We Get More Scientific Evidence The Middle Class Is Shrinking

Despair And Unemployment - Public DomainAs the U.S. economy slows down, we would expect to start to see evidence of this in the employment numbers, and that is precisely what has begun to happen.  During the week before last, initial claims for unemployment benefits jumped by 17,000, which was the largest increase that we had seen in over a year.  Well, last week we witnessed an even bigger spike.  Seasonally adjusted initial claims shot up 20,000 more to a total of 294,000.  Of course it makes perfect sense that more Americans are applying for unemployment benefits, because firms are laying people off at a much faster pace these days.  Just a couple days ago I reported that job cut announcements at major firms are running 24 percent higher this year compared to the first four months of last year.  So we should fully expect that the number of Americans seeking unemployment benefits will continue to accelerate.

Personally, I am a bit surprised by how quickly these numbers are getting worse.  The following comes directly from the Department of Labor

In the week ending May 7, the advance figure for seasonally adjusted initial claims was 294,000, an increase of 20,000 from the previous week’s unrevised level of 274,000. This is the highest level for initial claims since February 28, 2015 when it was 310,000. The 4-week moving average was 268,250, an increase of 10,250 from the previous week’s unrevised average of 258,000.

For a long time, initial claims for unemployment benefits were running quite low, and this was one of the few bright spots for the U.S. economy.

Unfortunately, that is now changing, and this is just more confirmation that a significant economic slowdown has already started.  For many more numbers that back up this claim, please see my previous article entitled “11 Signs That The U.S. Economy Is Rapidly Deteriorating Even As The Stock Market Soars“.

But whether the economy has been doing good or bad in recent years, the long-term trend of the decline of the middle class in America has continued unabated.

This week, we got even more evidence that the middle class is steadily disappearing from the Pew Research Center

The American middle class is losing ground in metropolitan areas across the country, affecting communities from Boston to Seattle and from Dallas to Milwaukee. From 2000 to 2014 the share of adults living in middle-income households fell in 203 of the 229 U.S. metropolitan areas examined in a new Pew Research Center analysis of government data. The decrease in the middle-class share was often substantial, measuring 6 percentage points or more in 53 metropolitan areas, compared with a 4-point drop nationally.

Do you understand what that is saying?

It says that the middle class got smaller in 203 out of 229 U.S. metropolitan areas between 2000 and 2014.  This means that the death of the middle class is very widespread and it is happening all over the country.

But it isn’t just the middle class that is suffering.  According to that same report, household incomes have been falling for Americans in all income brackets…

American households in all income tiers experienced a decline in their incomes from 1999 to 2014. Nationally, the median income of middle-income households decreased from $77,898 in 1999 to $72,919 in 2014, a loss of 6%. The median incomes of lower-income and upper-income households fell by 10% and 7%, respectively, over this period.

The systematic evisceration of the middle class has been a continuing theme that I have been writing about for many years.  And without a doubt, one of the biggest reasons for the decline of the middle class has been the disappearance of middle class jobs.

Thanks to “free trade agreements” that have been pushed by Bill Clinton, George W. Bush and Barack Obama, the U.S. economy has been steadily merged into the emerging one world economic system.  As a result, U.S. workers are now forced to directly compete for jobs with workers on the other side of the planet that live in countries where it is legal to pay slave labor wages.

It was inevitable that good paying jobs would leave areas where labor was expensive and go to places were labor was very cheap.  Over the past couple of decades, the U.S. has seen tens of thousands of manufacturing facilities shut down and we have lost millions of middle class jobs.

One of those middle class jobs was lost by a factory worker named Wendell Nolen

Wendell Nolen, 52, has experienced the slide from middle-class status first-hand. Eight years ago, he was earning $28 an hour as a factory worker for Detroit’s American Axle and Manufacturing Holdings, assembling axles for pickup trucks and SUVs.

But early in 2008, the good life unraveled. After a three-month strike, Nolen took a buyout rather than a pay cut. Less than a year later, the plant was closed and American Axle shipped much of its work to Mexico.

Now Nolen makes $17 an hour in the shipping department of a Detroit steel fabricator, about 40 percent less than he made at the axle plant.

America is losing jobs because of the free trade stuff,’ Nolen said. ‘They’re selling America out.’

I couldn’t have said it better myself.

If you step back and take a longer-term view of things, what has happened to our middle class is abolutely staggering.

For example, one study found that the middle class in America became a minority last year for the first time in our history.

And if you go back to 1970, the middle class took home close to 62 percent of all income, but today that number has dropped to just 43 percent.

This is a problem that has been crying out for a solution for a very long time, and yet our politicians have been sitting on their hands.

Now the next crisis is here, and the plight of the middle class is about to get a whole lot worse.

For months, my regular readers have been listening to me go on and on about how the U.S. economy is deteriorating, but now even the mainstream media is saying it.

For example, a Bloomberg article that just came out admits that “the next president will probably face a recession” no matter who wins the election…

Talk about a poisoned chalice. No matter who is elected to the White House in November, the next president will probably face a recession.

And an article that was just published by CNBC is even more pessimistic about the economy…

We are in the midst of a deceleration in the economy, and the chain of dominoes leading to a recession has started to fall. First, it was a weak global economy. Then, multinationals and business-to-business companies were hit by the resulting decline in global trade and commodity prices. Now, consumers are starting to feel the repercussions as they draw down their growth in spending on discretionary goods and services, which we saw reflected in the first-quarter GDP report.

This is the foreshadowing of a recession. We saw similar indicators prior to recessions in 2001 and 2008. Although there is potential for economic indicators to flip, the current momentum and indicators suggest that the U.S. economy will get worse before it gets better.

This is precisely what I have been saying.  The exact same indicators that told us that recessions were coming in 2001 and 2008 have been flashing bright red, but most people don’t seem to understand what is happening.

It doesn’t matter how much faith you may have in Barack Obama, Hillary Clinton, Bernie Sanders or Donald Trump.  None of them can stop what is already in the process of happening.

Without a doubt, we truly are “in the midst of a deceleration in the economy”, and it is most certainly true that “the next president will probably face a recession”.

In fact, we would be exceedingly fortunate if it is just a recession that we will be dealing with.

The largest and most important economy on the planet is teetering on the brink, and it is not going to take much to push us into a full-blown disaster.

So let us hope for some sort of economic miracle to take place, because we could really use one right about now.

Is America About To Reach A Breaking Point? Anger Grows As Unemployment Benefits Get Cut

Breaking PointIn America today, there are close to 50 million people living in poverty and there are more than 100 million people that get money from the federal government every month.  As the middle class disintegrates, poverty is climbing to unprecedented levels.  Even though the stock market has been setting record high after record high, the amount of anger and frustration boiling just under the surface in our nation grows with each passing day.  And now extended unemployment benefits have been cut off for 1.3 million unemployed Americans, and it is being projected that a total of 5 million unemployed Americans will lose their benefits by the end of 2014.  In addition, as I have written about previously, 47 million Americans recently had their food stamp benefits reduced.  The conditions for a “perfect storm” are certainly being created.  So how much longer will it be until we see all of this anger and frustration boil over in the streets of our major cities?  Is America about to reach a breaking point?

If you think that the title of this article is “alarmist”, you probably have not been paying attention to what has been happening over the past few weeks.  For example, a 600 person brawl broke out at at movie theater in Jacksonville, Florida just the other day…

Five teenagers were arrested when a 600-person brawl broke out in a Florida movie theater’s parking lot on Christmas night.

Described by police as a “melee,” the fight occurred around 8:30 p.m. on Wednesday outside the Hollywood River City 14 movie theater in Jacksonville when a group tried to storm the theater’s doors without purchasing tickets, police said. Several had rushed an off-duty police officer working as a security guard.

The officer “administered pepper spray to disperse the group, locked the doors and called for backup, following protocol,” said Lauri-Ellen Smith, a spokeswoman for the Jacksonville Sheriff’s Office.

Soon after the pepper spray was used, “upward of 600 people moving throughout a parking lot about the size of a football field began fighting, disrupting and jumping on cars,” she said.

And a “flash mob” of “400 crazed teens” was so violent that it forced a mall in Brooklyn to shut down just a few days ago

A wild flash mob stormed and trashed a Brooklyn mall, causing so much chaos that the shopping center was forced to close during post-Christmas sales, sources said Friday.

More than 400 crazed teens — who mistakenly thought the rapper Fabolous would perform — erupted into brawls all over Kings Plaza Shopping Center in Mill Basin on Thursday at 5 p.m., sources said.

The troublemakers looted and ransacked several stores as panicked shoppers ran for the exits and clerks scrambled to pull down metal gates.

In addition, the release of new Air Jordan sneakers caused mini-riots and brawls to break out all over the country just before Christmas.

So why is all of this happening?

Of course people will come up with all sorts of theories to explain these outbreaks of violence, but what pretty much everyone should be able to agree on is that we are seeing levels of anger and frustration rise to very dangerous levels in this country.

Right now, there are approximately 6 million Americans in the 16 to 24-year-old age group that are not in school and that are not working either.  What that means is that we have an alarmingly high number of very frustrated young people that do not have anything better to do than to cause trouble.

In some of our largest cities this has become a massive problem.  In fact, quite a few major U.S. cities actually have more than 100,000 “idle youth” living in them…

Just look at some of the nation’s largest cities. Chicago, Houston, Dallas, Miami, Philadelphia, New York, Los Angeles, Atlanta and Riverside, Calif., all have more than 100,000 idle youth, the Opportunity Nation report found.

But the Obama administration says that this should not be a problem.  In fact, the Obama administration tells us that the unemployment rate has been steadily “declining” and that there are plenty of opportunities for everyone.

Of course that is a giant lie.  Just before the last recession, about 63 percent of all working age Americans had a job.  During the recession that number fell below 59 percent and it has stayed there ever since

Employment-Population Ratio 2013

So the notion that we are experiencing an “employment recovery” is absolutely laughable.

But most of our politicians appear to believe this lie, and it is being used as justification to cut off extended unemployment benefits.

And the funny thing is that by cutting off these benefits, it is going to make it appear as though unemployment has gone down even more.  Millions of unemployed workers that are being forced into the streets will now be counted as having “left the labor force”, and it is being projected that the unemployment rate could decline by as much as half a percentage point as a result.

What a joke.

A lot of the people that are having their benefits cut off are really hurting.  For instance, consider the case of 63-year-old paralegal Laura Walker

“Not all of us have savings and a lot of us have to take care of family because of what happened in the economy,” said Walker, of Santa Clarita, who said she has applied for at least three jobs a week and shares an apartment with her unemployed son, his wife and two children. “It’s going to put my family and me out on the streets.”

So what is she going to do?

Well, at this point she appears to be down to just one option…

“I just don’t know what to do, except pray.”

And of course the unemployed are not the only ones that have had their benefits cut.  As I mentioned above, all 47 million Americans that are currently on food stamps recently had their benefits reduced.  The following is an excerpt from a recent article by Mac Slavo

Earlier this year government benefits for nutritional assistance were reduced after the expiration of emergency legislation that was enacted following the 2008 financial collapse. Nearly all of the 48 million people receiving food stamp distributions were affected. The move led to warnings from food pantries and recipients around the country who said that the $40 billion in cuts would leave many American families without the ability to put food on dinner tables across America. According to Feed America, the roughly $29 per family that would no longer appear on their EBT cards will amount to about 1.5 billion meals in 2014.

The fact that government dependence has soared to all-time highs even in the midst of this so-called “economic recovery” is just another sign that the middle class is dying.  For years, middle class families have tried strategy after strategy in an attempt to survive, but now it has become apparent that the middle class is rapidly approaching a breaking point

Rising income inequality is starting to hit home for many American households as they run short of places to reach for a few extra bucks.

As the gap between the rich and poor widened over the last three decades, families at the bottom found ways to deal with the squeeze on earnings. Housewives joined the workforce. Husbands took second jobs and labored longer hours. Homeowners tapped into the rising value of their properties to borrow money to spend.

Those strategies finally may have run their course as women’s participation in the labor force has peaked and the bursting of the house-price bubble has left many Americans underwater on their mortgages.

And even though the Obama administration and the mainstream media have tried to convince us over and over that the economy is “getting better”, most Americans are not buying it.  In fact, according to a new CNN poll, 70 percent of all Americans believe that “the economy is generally in poor shape”.

As the economy continues to decline, not all Americans will respond to their desperate situations by getting violent.  Many suffer quietly, hoping that things will eventually turn around for them.  Unfortunately, the ranks of the suffering grow with each passing year.  For example, a recent CNN article discussed the continued growth of “tent cities” all over America…

The total number of homeless people residing in tents and makeshift homes is unknown. Many of these communities are small and hidden from public view, while others claim hundreds of residents and are sprinkled through major urban areas.

Some, like those tucked under roadways, are temporary and relocate frequently. Their conditions are vile, unsanitary and fail to provide refuge from storms and winds. Then there are communities, such as Dignity Village in Portland, Oregon, that have a more sustained presence. The 13-year-old “ecovillage” set up by homeless people is hygienic and self-sufficient.

Preliminary findings by The National Law Center on Homelessness and Poverty show that tent cities have been documented in almost every state, and they’re growing.

So how do we solve these problems?

Are there any solutions that could get us out of this mess?

Of course there are.  But don’t hold your breath waiting for any of them to be adopted.  In fact, the American people continue to express great support for the very people that got us into this mess in the first place.  For example, according to a Gallup survey that was just released, Barack Obama is the most admired man in America by a very wide margin and Hillary Clinton is the most admired woman in America by a very wide margin.

And the mainstream media will continue to tell all of us that “leaders” like Obama, Clinton, Reid, Boehner, McConnell and Pelosi can be trusted to get us out of this mess.

If you believe that, there is a bridge that I would like to sell you.

The American people need to stop having blind faith in the relentless propaganda that is being spewed at them through their televisions screens.  The pretty faces that you see “reporting the news” do not care about you and they are not watching out for your best interests.  The corporate-controlled news is highly scripted and it is pretty much the same whatever channel you turn to.  If you have any doubt that “the news” is scripted, just check out this video

The Worst Economic Numbers In More Than A Year

With everything else that is going on in the world, a lot of people have failed to notice that we are seeing some of the worst economic numbers that we have seen in more than a year.  For example, it was announced on Thursday that initial claims for unemployment benefits have hit their highest level in a year and a half.  Hopefully this is just a temporary blip in the data, because initial unemployment claims tend to have a very strong correlation with the overall performance of the economy.  We also continue to see poverty statistics rise.  According to government statistics released earlier this month, the number of Americans living in poverty and the number of Americans on food stamps are both at all-time record highs.  Meanwhile, the Dow and the S&P 500 are both down more than 5 percent since the election and the U.S. government rolled up 22 billion dollars more debt in October 2012 than it did in October 2011.  The unfortunate truth is that things are not getting better.  The U.S. economy continues to become weaker and more unstable, and there are a whole lot of reasons to be very pessimistic about our economic situation as we move into the winter months.

Let’s take a closer look at some of the troubling economic numbers that have been released in recent days…

Initial Claims For Unemployment Benefits

The optimism that many analysts had about jobs is rapidly dissipating.  Over the past few weeks there has been a huge wave of companies announcing layoffs.  Just check out this article and this article.

But now we are actually seeing a significant rise in the number of American workers applying for unemployment benefits.  Initial claims for unemployment benefits soared to 439,000 for the week ending November 10th.  This is the highest level that we have seen in more than a year.  The last time initial claims were this high was April 2011.  It is interesting to note that the largest numbers of new unemployment claims came from the swing states of Ohio and Pennsylvania.

Record Food Stamp Numbers

In dozens of articles I have carefully documented the steady rise of poverty in America and the steady decline of the middle class.

Even though our politicians insist that we are in the middle of an “economic recovery”, the number of Americans dependent on the government for their very survival just continues to keep going up.

A few days ago, the latest food stamp numbers were released.  It turns out that the number of Americans on food stamps increased by 420,947 from July to August.  That was the largest one month increase that we have seen in a year.  At this point, an all-time record 47.1 million Americans are enrolled in the food stamp program.  What would that look like if all of those people had to actually stand outside in bread lines like in the old days?

Stunning Stock Market Declines

A few days ago, I wrote about how many wealthy Americans are dumping stocks and other financial assets in anticipation of the looming “fiscal cliff”.

Well, if things get much worse we may soon have a “market crash” on our hands.

The Dow and the S&P 500 are both down by more than 5 percent since the election and many are wondering if things are about to get a whole lot worse.

Shares of Apple are down by 25 percent since late September.  Some analysts are actually using the term “panic selling” to describe what is happening to the stock.

Slowing Economic Activity

All over America there are indications that economic activity is starting to slow down.  Is Superstorm Sandy responsible for this, or are there other factors at work?

According to the Federal Reserve Bank of New York, economic activity appears to be contracting in areas that were hit particularly hard by Superstorm Sandy…

The Federal Reserve Bank of New York’s general economic index was minus 5.2 this month after minus 6.2 in October. Readings of less than zero signal contraction in New York, northern New Jersey and southern Connecticut.

Things appear to be slowing down in the mid-Atlantic region as well.  According to CNBC, manufacturing activity in the mid-Atlantic region has contracted much faster than analysts were projecting…

The Philadelphia Federal Reserve Bank said its business activity index slumped to -10.7 from 5.7 the month before. The fall was much steeper than economists’ expectations for slippage to a reading of 2.0, according to a Reuters poll.

Any reading above zero indicates expansion in the region’s manufacturing. The survey covers factories in eastern Pennsylvania, southern New Jersey, and Delaware.

New Poverty Numbers

More American families are falling out of the middle class every single day.

New numbers that were just released by the U.S. Census Bureau show that the number of Americans living in poverty rose to a new all-time record of 49.7 million last year.

Once upon a time, people would have laughed at you if you suggested that someday 50 million Americans would be living in poverty.

But here we are.

Soaring Government Debt

Anyone that follows my columns on a regular basis knows that government debt is one of my major pet peeves.

Well, despite all of the “budget deals” that have been made between the Republicans and the Democrats, the amount of debt that we are accumulating just continues to balloon in size.

The federal budget deficit for October 2012 was 120 billion dollars.  That was a huge increase over the October 2011 federal budget deficit of 98 billion dollars.

How long can we possibly continue to do this?

Things In Europe Are Getting Worse Too

In case you had not noticed, the economic situation in Europe continues to unravel as well.  The eurozone is officially in a recession once again, and unemployment in the eurozone is at an all-time record high.  Violent protests and rioting happen on an almost daily basis over in Europe now.  The largest economy on the planet continues to implode right in front of our eyes, and this is another factor that will continue to drag down the U.S. economy.

So is there anyone out there that actually still believes that things are “getting better”?

The brief period of economic stability that we have been experiencing is rapidly coming to an end.  The “recovery” turned out to be extremely disappointing, and now the next major downturn is almost here.

Just When You Thought It Was Safe To Start Sending Out Resumes Again….

Perhaps you had heard that the unemployment rate in the United States has been going down and you were planning to start sending out resumes again.  Well, unfortunately it is not “morning in America” again.  Some really depressing jobs numbers were just released.  The number of Americans applying for unemployment benefits skyrocketed last week to the highest level that we have seen in 8 months.  Also, according to a new poll more American workers say that their companies are getting rid of workers than say that their companies are hiring more workers.  So feel free to start mailing out thousands of resumes once again – just don’t expect better results.  Tens of millions of unemployed and underemployed Americans have been waiting for the “economic recovery”, but the sad truth is that this is the economic recovery.  This is about the best that things are going to get before the next major wave of the economic collapse strikes.

Most economists were extremely surprised by how bad the new numbers were.  The following is an excerpt from the press release from the Department of Labor….

In the week ending April 30, the advance figure for seasonally adjusted initial claims was 474,000, an increase of 43,000 from the previous week’s revised figure of 431,000. The 4-week moving average was 431,250, an increase of 22,250 from the previous week’s revised average of 409,000.

As noted above, that was the highest number of initial unemployment claims that we have seen in eight months.

In addition, ADP has announced that only 179,000 private sector jobs were added to the economy during the month of April.

That number also was an unpleasant surprise to most economists.

But shouldn’t the economy be recovering by now?

Yes, it should be.

Unfortunately, there is even more bad news.

According to the latest Rasmussen Employment Index, 19 percent of U.S. workers say that their companies are hiring more workers right now and 25 percent of U.S. workers say that their companies are laying off workers right now.

That is not a good sign.

But even when jobs are available most of the time they are crappy jobs.

A growing percentage of jobs in America do not even pay a living wage.  Low income jobs now make up 41% of all the jobs in the United States.

In a recent article on outsourcing, I noted that the U.S. economy is bleeding lots of good jobs and that they are being replaced by bad jobs….

Right now America is rapidly losing high paying jobs and they are being replaced by low paying jobs.  According to a recent report from the National Employment Law Project, higher wage industries accounted for 40 percent of the job losses over the past 12 months but only 14 percent of the job growth.  Lower wage industries accounted for just 23 percent of the job losses over the past 12 months and a whopping 49 percent of the job growth.

So do you want to mop floors at the local Burger King or stock shelves over at Best Buy?

A million Americans recently showed up to apply for a job at McDonald’s.  If that is not a sign that the American people are losing faith in the economy then I don’t know what is.

So are you ready to go down and apply for a job at McDonald’s?

Well, if not you may find yourself waiting for a very, very long time for a “good job”.

According to the U.S. Bureau of Labor Statistics, the average duration of unemployment in the United States is now an all-time record 39 weeks.

Today, we have millions upon millions of Americans that are sitting home because they can’t find work.

Only 66.8% of American men had a job last year.  That was the lowest level that has ever been recorded in all of U.S. history.

That is not good for the economy.  Instead of being productive and producing wealth for the economy, all of those unemployed men are a drain on the system.

Today, 18 million more Americans are receiving food stamps than when the economic downturn first began back in 2007.

Considering the gigantic amounts of spending that the U.S. government has been doing since the beginning of the economic downturn and considering the massive amounts of new money that the Federal Reserve has been injecting into the financial system, the unemployment rate should be much, much lower than it is now.

Our leaders have gone “all in” on stimulating the economy in the short-term and yet it is still responding like a dead horse.

Now there are even some in the financial media that are saying that we are going to need “QE3” in order to get the economy going.

Perhaps we will even need “QE4”, “QE5” and “QE6”.

This is getting ridiculous.

Essentially the U.S. economy is like a patient that the doctors are hovering around and desperately trying to revive.

So are they going to be successful?

I wouldn’t bet on it.

Sadly, what we are experiencing right now is the economic recovery.

When the next wave of the economic collapse hits, things are going to get even worse.

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