What is going to happen to society when robots are able to do just about everything better, faster and cheaper than human workers can? We live at a time when technology is increasing at an exponential pace. Incredible advancements in robotics, computer science and artificial intelligence are certainly making our lives more comfortable, but they are also bringing fundamental changes to the workplace. For employers, there are a lot of advantages to replacing human workers with robots. Robots don’t surf around on Facebook when they are supposed to be working. Robots don’t need Obamacare, lunch breaks or vacation days. Robots never steal from the company and they never complain. Up until fairly recently, human workers could generally perform many tasks more cheaply than robots could, but now that is rapidly changing.
For example, a coffee shop has just opened up in San Francisco that is manned by a robot instead of a human…
Tired of your barista misspelling your name on your morning cup of joe? Perhaps a robot could do better. On Monday, Cafe X opened its very first robotic cafe in San Francisco’s Metreon shopping center. Promising “precision crafted specialty coffee in seconds, the way the roaster intended,” Cafe X thinks that anything a human can do, its machines can do better.
Specifically, one very special machine. Nicknamed Gordon, after a Cafe X employee, this robot mans, or robots, two standard professional coffee machines in order to serve up espressos and lattes. In the San Francisco location, customers can grab a cup of coffee with beans from AKA Coffee, Verve Coffee Roasters, or Peet’s. While the coffee itself may not make Cafe X stand out from the competition, the startup hopes that the robot’s efficiency will.
If that coffee shop demonstrates that it can be much more profitable than a coffee shop with human employees, it is just a matter of time before human baristas start to be phased out all over the nation.
A similar thing is happening in many supermarkets. Personally, I hate the “self-checkout lines”, but you are starting to see them everywhere these days.
And according to the Sun, Amazon is playing around with a concept that would employ hardly any human workers at all…
In the case of Amazon’s automated retail prototype, a half-dozen workers could staff an average location. A manager’s duties would include signing up customers for the “Amazon Fresh” grocery service. Another worker would restock shelves, and still another two would be stationed at “drive-thru” windows for customers picking up their groceries, fast-food style.
The last pair would work upstairs, helping the robots bag groceries to be sent down to customers on “dumbwaiter”-like conveyors, a source said.
With the bare-bones payroll, the boost to profits could be huge. Indeed, the prototype being discussed calls for operating profit margins north of 20 percent. That compares with an industry average of just 1.7 percent, according to the Food Marketing Institute.
During the recent presidential campaign, much was made of the fact that we have shipped millions of good paying jobs overseas over the past several decades.
We can certainly try to make some laws that would keep American workers from losing jobs to foreign workers, but pretty soon workers all over the world are going to be losing millions of jobs to technology, and it is going to be just about impossible to make laws to prevent that from happening.
Just check out what is happening in China. Many big firms had moved manufacturing to China because labor was much cheaper over there, but now a lot of those cheap Chinese workers are being replaced by robots…
Apple’s iPhone manufacturer, Foxconn, in fact, has already begun automating certain work that was previously done by hand. A Chinese government official told a Hong Kong newspaper in May that Foxconn had replaced 60,000 workers with robots at one factory there. And the company is receiving incentives north of Shanghai in the eastern-central Jiangsu Province to accelerate investments in robotics to replace human labor, according to Chinese state media organization Xinhua.
Sadly, this is just the beginning. According to one study, 49 percent of all activities currently performed by human workers could already “be turned over to some sort of machine or robot”…
About 49% of worker activities can be turned over to some sort of machine or robot, increasingly helped along by artificial-intelligence software, according to consultancy McKinsey.
About 58% of CEOs plan to cut jobs over the next five years because of robotics, while 16% say they plan to hire more people because of robotics, according to a PricewaterhouseCoopers survey.
And Carl Frey of Oxford University has determined that some professions have more than a 90 percent chance of becoming automated in the coming years…
The revelations that dependable office jobs such as insurance workers and real estate agents have a more than 97% chance of becoming computerised could now spark fears among the middle class workforce.
‘While low-skilled jobs are most exposed to automation over the forthcoming decades, a substantial number of middle-income jobs are equally at risk.’ Frey told The Times.
Other jobs that feature high on the ‘risk list’ are credit analysts who have a 97% chance of losing their jobs to robots, postal service workers at 95% and lab technicians who have an 89% chance of seeing their role become automated.
So what in the world are we going to do with billions of human workers around the globe that are no longer needed when technology takes virtually all of our jobs?
Some have suggested that the idea of “work” will become a thing of the past, and that society will evolve into a socialist utopia where everything we need is provided for by the government. In fact, the concept of a “universal basic income” is already being promoted in Europe and elsewhere.
But others see a dystopian future where the gap between the “haves” and the “have nots” grows greater than ever before. Humanity has always been plagued by poverty and greed, and everyone agrees that the gap between the very wealthy and the rest of us has been growing very rapidly in recent years.
Where there is nearly universal agreement is on the fact that big changes are coming. Workers are going to be displaced by technology at an accelerating rate in the years ahead, and this will present a tremendous challenge for us all.
The largest Islamic nation in the Middle East is on the verge of descending into civil war, the Syrian civil war is starting to spill over into Lebanon, and the worst violence in five years has just hit Iraq, but Barack Obama is way too busy to be bothered with any of that. Right now, Obama is enjoying one of the true loves of his life – golf. According to the Washington Post, Obama has “played 18 holes of golf every day but one this week”, and without a doubt he appears to really be enjoying his time up in Martha’s Vineyard. I hear that it is absolutely beautiful up there this time of the year. And apparently he needs the rest. After all, prior to this vacation he has only had time to play 133 rounds of golf since becoming president. Between snubbing world leaders and getting the U.S. economy going again, it must be really tough for Obama to find enough time to sharpen his game.
Of course I am being facetious. It is absolutely ridiculous how much time Obama takes off, and Congress is even worse. Congress is taking a five week vacation right now. Most Americans don’t get that much vacation in an entire year.
Meanwhile, as our leaders enjoy their rest, the Middle East is coming apart at the seams.
In Egypt, authorities say that 638 people are now confirmed dead and another 3,994 people were wounded in the nightmarish violence that erupted in Cairo this week. Hundreds of bodies remain uncounted by the authorities, and it appears very likely that Egypt is rapidly heading down the path to full-blown civil war…
Angry supporters of ousted president Mohammed Morsi staged protests and burned buildings Thursday as President Obama condemned the violence on both sides and canceled next month’s joint military operations.
The unrest came a day after at least 638 people were killed in violence nationwide, including 43 police officers, the Health Ministry said. Most of the deaths occurred when security forces smashed two pro-Morsi sit-in camps in the capital. In the Nasr City district, 288 people were killed.
The Health Ministry said 3,994 people were injured.
After the police moved on the camps, street battles broke out across Egypt. Government buildings and police stations were attacked, roads were blocked, and Christian churches were torched, Interior Minister Mohammed Ibrahim said.
Sadly, some of the supporters of the Muslim Brotherhood have chosen to express their fury with the government by setting Christian homes, businesses and churches on fire. According to one report, 18 churches have been torched so far…
Now, with the crackdown on Muslim Brotherhood members by the Egyptian army, Islamist fanatics are taking out their frustrations on Coptic Christians. In the past few days, there has been a spate of attacks on Christian businesses, homes, and churches. As of Wednesday morning, according to local witnesses, at least 18 churches had been destroyed, and fires and riots were continuing to spread in Christian areas, the witnesses said.
This is absolutely despicable, and it is turning out to be one of the worst disasters for Coptic Christians ever recorded. Over the past few days, Twitter has been absolutely flooded with reports about what has been happening to Christians in Egypt…
Using the hashtag #EgyChurch, Egyptian users of Twitter and other social networks broadcast messages like “Can’t keep up with the number of churches, Christian businesses, and affiliates being attacked by ‘peaceful’ Muslim Brotherhood,” “It’s clear the Copts are having their churches burnt,” and “This is quickly becoming the worst sectarian catastrophe we’ve seen in our lifetimes.”
Meanwhile, the violence in Iraq continues to escalate. The following is how Reuters described what happened in Baghdad on Thursday…
Car bomb attacks killed at least 34 people in Baghdad on Thursday but the Interior Ministry said it would not allow al Qaeda, which it blames for a surge in sectarian violence, to turn Iraq into another Syria.
More than 100 people were wounded in at least eight blasts, one of which was near the “Green Zone” diplomatic complex, part of a wave of bloodshed that has taken the monthly death toll in Iraq to the highest levels in five years.
“Iraq’s streets have become a battleground for sectarian people who are motivated by hatred and religious edicts and daring to kill innocent people,” the Interior Ministry said in an unusually frank statement.
“It is our destiny to win this battle which is aimed at destroying the country and turning it into another Syria,” the ministry said.
And the absolutely brutal civil war in Syria is now spilling over into Lebanon. On Thursday, a Shiite stronghold in Beirut was hit by the worst car bomb attack that Lebanon has witnessed in decades…
A powerful car bomb tore through a bustling south Beirut neighborhood that is a stronghold of Hezbollah on Thursday, killing at least 18 and trapping dozens of others in an inferno of burning cars and buildings in the bloodiest attack yet on Lebanese civilians linked to Syria’s civil war.
The blast is the second in just over a month to hit one of the Shiite militant group’s bastions of support, and the deadliest in decades. It raises the specter of a sharply divided Lebanon being pulled further into the conflict next door, which is being fought on increasingly sectarian lines pitting Sunnis against Shiites.
And of course we shouldn’t forget about the war in Yemen either. Sadly, as Ron Paul recently noted, most Americans don’t even realize what is going on in Yemen…
Most Americans are probably unaware that over the past two weeks the US has launched at least eight drone attacks in Yemen, in which dozens have been killed. It is the largest US escalation of attacks on Yemen in more than a decade. The US claims that everyone killed was a “suspected militant,” but Yemeni citizens have for a long time been outraged over the number of civilians killed in such strikes. The media has reported that of all those killed in these recent US strikes, only one of the dead was on the terrorist “most wanted” list.
This significant escalation of US attacks on Yemen coincides with Yemeni President Hadi’s meeting with President Obama in Washington earlier this month. Hadi was installed into power with the help of the US government after a 2011 coup against its long-time ruler, President Saleh. It is in his interest to have the US behind him, as his popularity is very low in Yemen and he faces the constant threat of another coup.
Unfortunately, this is probably only just the beginning.
The violence in the Middle East is probably going to get much worse, and at some point I expect a major regional war to erupt in the years ahead.
But instead of going back to the White House and at least giving the appearance of being on top of things, Obama plans to continue his golf vacation.
This is so negligent that even the Washington Post is ripping him to shreds…
In a sense, then, Obama might as well play golf. He’s dropped the ball on Egypt and the entire region, leaving the United States with few options and the Egyptian people to a bloody future in the short run and a repressive authoritarian junta in the longer run. This is a policy failure of the highest order.
But this is just par for the course for Obama.
As we learned this week, this is the guy that was actually playing cards during the bin Laden raid…
Despite the picture the White House released showing President Obama intently watching the raid that killed Osama bin Laden, his former “body man” says the president spent most of the raid playing a card game.
“Most people were like down in the Situation Room and [the president] was like, ‘I’m not going to be down there, I can’t watch this entire thing.’ So he, myself, Pete Souza, the White House photographer, Marvin [Nicholson], we must have played 15 games of spades,” former Obama aide Reggie Love said at an event in Los Angeles sponsored by The Artists & Athletes Alliance in July.
Love, who played college basketball and football at Duke University, left the White House in 2011 to attend business school.
You can see video of Obama’s former “body man”, Reggie Love, making these remarks right here.
When it comes to foreign policy, Obama seems to be totally clueless.
So what would happen someday if a major foreign policy crisis erupted that actually seriously threatened our national security?
Would Obama be up to the task?
Let’s hope that we don’t have to find out.
Are you constantly tired and do you feel incredibly stressed almost all the time? Well, that means that there is a really good chance that you are a typical American worker. Even though our incomes are going down, Americans are spending more time at work than ever before. In fact, U.S. workers spend more time at work than anyone else in the world. But it was not always this way. Back in 1970, the average work week for an American worker was about 35 hours. Today, it is up to 46 hours. But there are other major economies around the globe that are doing just fine without burning their workers out. For example, the average American worker spends 378 more hours working per year than the average German worker does. Sadly, for many Americans work is not even finished once they leave the office. According to one recent survey, the average American worker spends an extra seven hours per week on work tasks such as checking emails and answering phone calls after normal work hours have finished. Other Americans are juggling two or three jobs in a desperate attempt to make ends meet. Americans are busier than ever and work is often pushing the other areas of our lives on to the back burner. What this also means is that “family vacations” are becoming increasingly rare in the United States. In fact, Americans spend less days on vacation than anyone else in the industrialized world. While some would applaud our “work ethic”, the truth is that the fact that we are being overworked is having some very serious consequences. In fact, as you will see below, Americans are literally being worked to death.
The following is an excerpt from a comment that one reader posted on one of my recent articles. Can you identify with what this family is going through?….
I always try and remember to be thankful and say prayers of gratitude for the blessings I have, however I can tell you that my wife and I are getting more and more exhausted.
Straight forward payroll taxes nailed us for $35k last year and the dozens of other taxes are often over-looked but also hitting us harder and harder.
My wife works 14 hour shifts at her dialysis clinic 3 days a week and every other weekend. On the Tuesdays and thursdays she has off she ends up resting half the day to give her poor feet a break since a nurse on her feet 14 straight hours of continual busyness is exhausting.
On top of that, her company has had a pay freeze for 3 years, has dropped Holidays down to just 2 per year ( Thanksgiving and Christmas of which she must work 1 of them), has canceled the reimbursement of her CEU’s ( medical professionals are required to continue to take schooling and classes for their entire career in order to renew their licenses) –also they no longer match 401k’s and her company health plan just bumped up $30 per week!!
I put in so many hours at times that when I get home I am too tired to eat. I come home, change clothes/shower and go straight to bed–this is not living. I try and keep up with my volunteer work and rounds at our local nursing home but something is going to have to give. My caseloads are growing and growing and people are making appts 2-3 weeks in advance. I never had a schedule so filled in advance before. I usually have more long-term pt’s with needs of stroke, Parkinson’s, traumatic brain injuries..but now ortho pt’s are scheduling surgeries as to when I’ll have slots for hip replacement and knee replacement rehab time.
I’m ground down and in the mean time everything is getting more expensive, they keep taking more of my money I earn and we are having all of our benefits cut or completely stopped.
All over this country, millions of hard working men and women are slowly being worn down by jobs that are sucking the life out of them. Working way too many hours for an extended period of time can have dramatic consequences for your health, your family and just about every other area of your life.
But for some Americans, there is simply no other choice. There are millions upon millions of Americans that live on the edge of financial disaster these days. According to one recent survey, 77 percent of all Americans live paycheck to paycheck at least some of the time, and the middle class in the United States has been shrinking at a very steady pace in recent years.
Many Americans are not working 60 or 70 hours per week because they want to.
Many are doing it because that is what they must do just to survive.
For example, a recent article posted on Economy In Crisis profiled a mother of four up in Michigan named Lisa Bosworth who can’t make ends meet for her family despite working three jobs….
Bosworth remarried but her current husband, Ray, was forced onto medical disability when a prescription medication caused health problems. The couple, who had a fourth child together, struggle to support their family on Lisa’s meager income.
Bosworth’s gross monthly income from working as a classroom aide in Reeths-Puffer schools and doing two Chronicle newspaper routes is $1,900. That amounts to $22,800 annually, nearly $5,000 below the poverty level for a family of six.
When they run out of money near the end of each month, Lisa and Ray Bosworth line up at one of several food trucks that visit Muskegon each month.
Earlier this month, the couple and three of their children waited in line at a food truck at Calvin Christian Reformed Church in Norton Shores. Lisa Bosworth had just finished her two newspaper routes and was clearly fatigued after another 70-hour work week. “I’m tired,” she said.
Today, there are more than 100 million Americans on welfare, and a significant percentage of those people actually do have jobs. In fact, some are working two or three jobs.
Working class Americans are working harder than ever, but at the same time many of them are making less money than they once did.
This is putting an incredible amount of stress on working class families.
In fact, it appears that a lot of Americans are literally working themselves to death.
And as a recent CBS News article described, this is particularly true for poor Americans that do not have much education….
Overall life expectancy has dropped for white Americans who have less than a high school diploma to rates similar to those of the 1950s and 1960s, new research finds.
The study found non-Hispanic white men without a diploma lived on average until 67.5 in 2008, three years less than they did in 1990. The drop in lifespan was even bigger for non-Hispanic white women with low education: They live five years shorter than 1990 rates, from 78 years old to just 73.5.
This is a sign that our society is going backwards. Working class Americans are actually living significantly shorter lives than they used to.
Of course the garbage that passes for “food” these days certainly is not helping matters any, but that is a topic for another article.
Sadly, those that are working themselves to death consider themselves to be the “lucky ones” in our society today.
There are countless millions of other Americans that are sitting at home right now without a job.
The mainstream media is trying to convince us that the unemployment rate has been falling, but that is a lie. If the labor force participation rate was the same today as it was back when Barack Obama first took office, the unemployment rate in the United States would be 11.2 percent right now.
But that doesn’t sound nearly as good as 8.1 percent sounds, right?
And the percentage of working age Americans with a job is actually lower today than when the last recession supposedly ended.
In this economic environment, most people are scared to death of losing the jobs that they currently have because they don’t know if they will be able to get another one.
During the month of August, the unemployment rate actually increased in 26 different U.S. states, and yet we are supposedly in the midst of “an economic recovery”.
But the truth is that we are not better off than we were back during the last recession. In fact, there are a whole host of statistics that indicate that things are getting worse.
Unfortunately, much of the time people tend to forget that the horrible economic numbers that we are seeing have very substantial real life consequences.
People that cannot find work and people that work very long hours for a very long period of time tend to be much more depressed than the population as a whole.
And depression can often lead to suicide. According to a recent Daily Mail article, more Americans now die from suicide than from car accidents….
Suicide is the cause of more deaths than car crashes, according to an alarming new study.
The number of people who commit suicide in the U.S. has drastically increased while deaths from car accidents have dropped, making suicide the leading cause of injury death.
Suicides via falls or poisoning have risen significantly and experts fear that there could be many more unaccounted for, particularly in cases of overdose.
That is incredibly tragic, because there is never a reason for anyone to commit suicide. One of the things that I have learned in my own life is that there is always a way for things to be turned around.
Yes, life can be very hard when you don’t have much money, but our lives should not be about chasing material things anyway. Our lives should be about so much more than that.
If you are currently feeling overly tired and overly stressed because you have been working too much, I encourage you to take a vacation.
We are only given one life to live. We shouldn’t spend it working ourselves to death.
So what do you think about all of this? Please feel free to post a comment with your thoughts below….
Summer vacation is over and things are about to get very interesting in Europe. Most Americans don’t realize this, but much of Europe shuts down for the entire month of August. I wish we had something similar in the United States. But now millions of Europeans are returning from their extended family vacations and the fun is about to begin. During August economic conditions continued to degenerate in Europe, but I figured that it wouldn’t be until after August that the European debt crisis would take center stage once again. And as I wrote about last week, if there is going to be a financial panic, it typically happens in the fall. The stock market has seen quite a nice rally over the summer, and many investors are nervous that we could see a significant “correction” very soon. The month of September has been the absolute worst month for stock performance over the past 50 years, and it has also been the absolute worst month for stock performance over the past 100 years as well. Of course that does not guarantee that anything is going to happen this year. But things in Europe continue to get worse. Unemployment rates are spiking, manufacturing activity is slowing down, housing prices are crashing and major financial institutions are failing. What is happening in Europe right now appears to be an even worse version of what happened to the United States back in 2008.
But most Americans aren’t too concerned about what is happening in Europe.
In fact, most Americans don’t believe that a European financial collapse would be much of a problem for us.
Well, just remember what happened back in 2008. When the U.S. financial system started coming apart at the seams it sparked a devastating worldwide recession which was felt in every corner of the globe.
If the European financial system implodes, the consequences could be even worse.
Europe has a larger population than the United States does.
Europe has a larger economy than the United States does.
Europe has a much, much larger banking system than the United States does.
If Europe experiences a financial collapse, the entire globe will feel the pain.
And considering how weak the U.S. economy already is, it would not take much to push us over the edge.
What is going on in Europe right now is a very, very big deal and people need to pay attention.
The following are 18 indications that Europe has become an economic black hole which is going to suck the life out of the global economy….
#1 The unemployment rate in France is up to 10 percent, and the French media is buzzing about the fact that the number of unemployed French workers has now hit the 3 million mark.
#2 The French government has just announced the nationalization of its second largest mortgage lender. Additional bailouts are likely on the way.
#3 French automaker PSA Peugeot Citroen has announced that it will be cutting more than 10,000 jobs. But of course major layoff announcements like this are coming out of Europe almost every day now.
#4 Home prices in France are falling rapidly and the recent election of a socialist president has created a bit of a panic in the French housing market….
British people with homes in France were today warned that the property market is in ‘free fall’.
A combination of factors including the election of a tax-and-spend Socialist government means that prices are tumbling.
It means an end to the boom years, when thousands of Britons poured money into rental or retirement investments across the Channel.
#5 A slow-motion bank run is happening in Spain. The amount of money being pulled out of the Spanish banking system is absolutely unprecedented. The following is from a recent Zero Hedge article….
The central bank of Spain just released the net capital outflow numbers and they are disastrous. During the month of June alone $70.90 billion left the Spanish banks and in July it was worse at $92.88 billion which is 4.7% of total bank deposits in Spain. For the first seven months of the year the outflow adds up to $368.80 billion or 17.7% of the total bank deposits of Spain and the trajectory of the outflow is increasing dramatically. Reality is reality and Spain is experiencing a full-fledged run on its banks whether anyone in Europe wants to admit it or not.
If this pace keeps up, more than 600 billion dollars will be pulled out of Spanish banks by the end of the year.
Keep in mind that the GDP of Spain for all of 2011 was just 1.49 trillion dollars.
So by the end of this year we could see the equivalent of more than 40 percent of Spanish GDP pulled out of Spanish banks and sent out of the country.
In case you were wondering, yes, that is a nightmare scenario.
#6 The unemployment rate in Spain is over 25 percent. The youth unemployment rate in Spain is well over 50 percent. Spain is a tinderbox that could be set ablaze at any moment.
#7 The yield on 10 year Spanish bonds is up to 6.85 percent. This is an unsustainable level, and if rates don’t come down on Spanish debt soon it is inevitable that Spain will end up just like Greece.
#8 On Monday it was announced that Spanish banking giant Bankia will be getting an emergency “cash injection” of between 4 and 5 billion euros. Apparently “cash injection” sounds better to the politicians than “a bailout” does.
#9 The housing crash in Spain just continues to get worse. It is being reported that some homes in Spain are being sold at a 70% discount from where they were at the peak of the market back in 2006. At this point there are approximately 2 million unsold homes in Spain.
#10 There are persistent rumors that the government of Spain will soon be forced to officially ask for a bailout from the rest of Europe. But who is going to bail them out? Most of the other governments of the eurozone are on the verge of bankruptcy themselves.
#11 Manufacturing activity in Europe has contracted for 13 months in a row. The following is from a recent Reuters report….
The downturn that began in the smaller periphery members of the 17-nation bloc is now sweeping through Germany and France and the situation remained dire in the region’s third and fourth biggest economies of Italy and Spain.
“Larger nations like France and Germany remain in reverse gear… the (manufacturing) sector is on course to act as a drag on gross domestic product in the third quarter,” said Rob Dobson, senior economist at data collator Markit.
Markit’s final Purchasing Managers’ Index (PMI) for the manufacturing sector fell from an earlier flash reading of 45.3 to 45.1, above July’s three-year low of 44.0, but notching its 13th month below the 50 mark separating growth from contraction.
#12 Chinese exports to the EU declined by 16.2 percent in July. U.S. exports to Europe have been steadily falling as well.
#13 Slovenia and Cyprus are two other eurozone members that are in desperate need of bailout money. The dominoes just keep falling and nobody seems to be able to come up with a plan to “fix” Europe.
#14 Even the “strong” economies in Europe are being dragged down now. For example, unemployment in Germany has risen for five months in a row.
#15 According to one recent poll, only about one-fourth of all Germans want Greece to remain a part of the eurozone. The odds of a breakup of the euro seem to rise with each passing day.
#16 It is now estimated that bad loans make up approximately 20 percent of all domestic loans in the Greek banking system at this point.
#17 The suicide rate in Greece is more than 30 percent higher than it was last year. People are becoming very desperate in Greece and there is no end in sight to the economic depression that they are going through.
#18 Large U.S. companies have been rapidly getting prepared for a Greek exit from the eurozone. The following is from a recent New York Times article….
Even as Greece desperately tries to avoid defaulting on its debt, American companies are preparing for what was once unthinkable: that Greece could soon be forced to leave the euro zone.
Bank of America Merrill Lynch has looked into filling trucks with cash and sending them over the Greek border so clients can continue to pay local employees and suppliers in the event money is unavailable. Ford has configured its computer systems so they will be able to immediately handle a new Greek currency.
Every time European leaders get together they declare that they have “a plan” that will solve the problems that Europe is experiencing, but as we have seen things in Europe just continue to get worse with no end in sight.
A key date is coming up in the middle of this month. On September 12th, Germany’s Constitutional Court will determine the fate of the recent fiscal pact and the ESM. According to UniCredit global chief economist Erik Nielsen, if the court rules against the fiscal pact and the ESM the fallout will be catastrophic….
“If they were to surprise us by striking down Germany’s participation, I would think it’d be an utter bloodbath in markets”
But that is not the only thing that could set off a full-blown panic in the financial markets.
The truth is that Europe is teetering on the edge.
One wrong move and it is going to be 1929 all over again.
As I have maintained all along, the next wave of the economic collapse is rapidly approaching, and this time the epicenter for the crisis is going to be in Europe.
But that does not mean that things are going to be easier for the United States than last time. We have never even come close to recovering from the last recession. Most Americans families are just barely getting by. In fact, 77 percent of them are living paycheck to paycheck at least part of the time.
Right now there are millions of Americans that have lost their jobs and their homes in recent years and that feel forsaken by society.
After this next wave hits us there will be tens of millions of Americans feeling the pain of economic desperation.
The last wave of the economic collapse hurt us.
This next wave is going to absolutely devastate us.
Watch what is happening in Europe very carefully. What Greece, Spain, Italy and France are experiencing right now is going to hit us soon enough.
Are we rapidly approaching a moment of reckoning for the global financial system? August is likely to be a relatively slow month as most of Europe is on vacation, but after that we will be moving into a “danger zone” where just about anything could happen. Historically, a financial crisis has been more likely to happen in the fall than during any other time, and this fall is shaping up to be a doozy. Much of the focus of the financial world is on whether or not the euro is going to break up, but even if the authorities in Europe are able to keep the euro together we are still facing massive problems. Countries such as Greece and Spain are already experiencing depression-like conditions, and much of the rest of the globe is sliding into recession. Unemployment has already risen to record levels in some parts of Europe, major banks all over Europe are teetering on the brink of insolvency, and the flow of credit is freezing up all over the planet. If things take a really bad turn, this crisis could become much worse than the financial crisis of 2008 very quickly.
All over the world people are starting to write about the possibility of a major economic crisis starting this fall.
For example, a recent article in the International Business Times discussed how some economists around the globe are fearing the worst for the coming months….
The consensus? The world economy has entered a final countdown with three months left, and investors should pencil in a collapse in either August or September.
Citing a theory he has been espousing since 2010 that predicts “a future lack of policy flexibility from the monetary and fiscal side,” Jim Reid, a strategist at Deutsche Bank, wrote a note Tuesday that gloated “it feels like Europe has proved us right.”
“The U.S. has the ability to disprove the universal nature of our theory,” Reid wrote, but “if this U.S. cycle is of completely average length as seen using the last 158 years of history (33 cycles), then the next recession should start by the end of August.”
The global financial system is so complex and there are so many thousands of moving parts that it is always difficult to put an exact date on anything. In fact, history is littered with economists that have ended up looking rather foolish by putting a particular date on a prediction.
But without a doubt we are starting to see storm clouds gather for this fall.
The following are 11 more signs that time is quickly running out for the global financial system….
#1 A number of very important events regarding the financial future of Europe are going to happen in the month of September. The following is from a recent Reuters article that detailed many of the key things that are currently slated to occur during that month….
In that month a German court makes a ruling that could neuter the new euro zone rescue fund, the anti-bailout Dutch vote in elections just as Greece tries to renegotiate its financial lifeline, and decisions need to be made on whether taxpayers suffer huge losses on state loans to Athens.
On top of that, the euro zone has to figure out how to help its next wobbling dominoes, Spain and Italy – or what do if one or both were to topple.
#2 Reuters is reporting that Spanish Economy Minister Luis de Guindos has suggested that Spain may need a 300 billion euro bailout.
#3 Spain continues to slide deeper into recession. The Spanish economy contracted 0.4 percent during the second quarter of 2012 after contracting 0.3 percent during the first quarter.
#4 The unemployment rate in Spain is now up to 24.6 percent.
#5 According to the Wall Street Journal, a new 30 billion euro hole has been discovered in the financial rescue plan for Greece.
#6 Morgan Stanley is projecting that the unemployment rate in Greece will exceed 25 percent in 2013.
#7 It is now being projected that the Greek economy will shrink by a total of 7 percent during 2012.
#8 German Finance Minister Wolfgang Schäuble says that the rest of Europe will not be making any more concessions for Greece.
#9 The UK economy has now plunged into a deep recession. During the second quarter of 2012 alone, the UK economy contracted by 0.7 percent.
#10 The Dallas Fed index of general business activity fell dramatically to -13.2 in July. This was a huge surprise and it is yet another indication that the U.S. economy is rapidly heading into a recession.
#11 As I have written about previously, a banking crisis is more likely to happen in the fall than at any other time during the year. The global financial system will enter a “danger zone” starting in September, and none of us need to be reminded that the crashes of 1929, 1987 and 2008 all happened during the second half of the year.
So is there any hope on the horizon?
European leaders have tried short-term solution after short-term solution and none of them have worked.
Now countries all over Europe are sliding into depression and the authorities in Europe seem to be all out of answers. The following is what one eurozone diplomat said recently….
“For two years we’ve been pumping up the life raft, taking decisions that fill it with just enough air to keep it afloat even though it has a leak,” the diplomat said. “But now the leak has got so big that we can’t pump air into the raft quickly enough to keep it afloat.”
The boat is filling up with water faster than they can bail it out.
So what is the solution?
Well, some of the top names in economics on both sides of the Atlantic are urging authorities to keep the debt bubble pumped up by printing lots and lots more money.
For example, even though the U.S. government is already running trillion dollar deficits New York Times “economist” Paul Krugman is boldly proclaiming that now is the time to print and borrow even more money. He is proud to be a Keynesian, and he says that “you should be a Keynesian, too.”
Across the pond, the International Business Editor of the Telegraph, Ambrose Evans-Pritchard, is strongly urging the ECB to print more money….
Needless to say, I will be advocating 1933 monetary stimulus à l’outrance, or trillions of asset purchases through old fashioned open-market operations through the quantity of money effect (NOT INTEREST RATE ‘CREDITISM’) to avert deflation – and continue doing so until nominal GDP is restored to its trend line, at which point the stimulus can be withdrawn again.
But is more money and more debt really the solution to anything?
In the United States, M2 recent surpassed the 10 trillion dollar mark for the first time ever. It has increased in size by more than 5 times over the past 30 years.
Unfortunately, our debt has been growing much faster than GDP has over that time period.
For example, during the second quarter of 2012 U.S. government debt grew by 274.3 billion dollars but U.S. GDP only grew by 117.6 billion dollars.
Our problem is not that there is not enough money floating around.
Our problem is that there is way, way too much debt.
But this is how things always go with fiat currencies.
There is always the temptation to print more.
That is one of the big reasons why every single fiat currency in history has eventually collapsed.
Printing more money will not solve our problems. It will just cause our problems to take a different form.
In the end, nothing that the authorities can do will be able to avert the crisis that is coming.
A lot of people are starting to realize this, and that is one reason why we are seeing so much economic pessimism right now.
For example, according to a new Rasmussen poll only 14 percent of all Americans believe that children in America today will be “better off” than their parents.
That is an absolutely stunning figure, but it just shows us where we are at.
Our economy has been in decline for a long time, and now we are rapidly approaching another major downturn.
You better buckle up, because this downturn is not going to be pleasant at all.
What in the world is Barack Obama thinking? The United States of America is falling apart all around him, and yet he decides to take a 17 day Hawaiian vacation. Does he even understand that he is the leader of the free world? Does he even understand that this country is mired in the worst economic downturn since the Great Depression? Last year, a similar Hawaiian vacation by the Obamas ending up costing more than 1 million dollars. Other than when I was in school, I don’t remember ever taking a 17 day vacation. In fact, most Americans do not even get 17 vacation days for an entire year. Yet the Obamas seem to think that part of occupying the White House is to take as many vacations as possible. It has been reported that Michelle Obama spent over 10 million dollars of U.S. taxpayer money on vacations during just one recent 12 month period alone. It would be one thing if they were taking these vacations at a time when America was thriving, but the truth is that the U.S. is facing one crisis after another right now. Our debt is now over 15 trillion dollars. If you can believe it, the U.S. government has not been operating under an approved budget for over 900 days. More Americans fell into poverty last year than ever before. More Americans are on food stamps than ever before. An average of 23 manufacturing facilities were shut down every single day in the United States last year. According to one recent report, only 7 percent of Americans that lost their jobs during the recession have “made it back” to where they were before the recession. So perhaps Barack Obama should spend more time doing his job rather than taking extended vacations.
During this holiday season, tens of millions of American families are suffering horribly. Any sane president would realize that this is not the time to be gallivanting off to Hawaii again. The following short excerpt comes from a recent article in the Daily Mail…..
While most Americans are lucky to get a few weeks of holiday every year, it seems the country’s leader gets a little more freedom in the matter.
President Barack Obama has announced his Christmas vacation to Hawaii – for a staggering 17-day trip.
Obama, who visited the island just two weeks ago for an economic summit, will head to Honolulu on Saturday December 17 until Monday January 2.
But this is not just one isolated incident. Obama has taken a whole bunch of vacations since he moved into the White House. According to the New York Post, Barack Obama enjoyed a total of 10 separate vacations that stretched over a total of 90 vacation days during the years of 2009 and 2010.
In addition, Obama managed to find time for 29 rounds of golf during his first two years in office.
But reportedly the biggest “vacation junkie” of all in the Obama family is Michele Obama.
The following shocking excerpt comes from a different Daily Mail article….
The First Lady is believed to have taken 42 days of holiday in the past year, including a $375,000 break in Spain and a four-day ski trip to Vail, Colorado, where she spent $2,000 a night on a suite at the Sebastian hotel.
And the first family’s nine-day stay in Martha’s Vineyard is also proving costly, with rental of the Blue Heron Farm property alone costing an estimated $50,000 a week.
The source continued: ‘Michelle also enjoys drinking expensive booze during her trips. She favours martinis with top-shelf vodka and has a taste for rich sparking wines.
‘The vacations are totally Michelle’s idea. She’s like a junkie. She can’t schedule enough getaways, and she lives from one to the next – all the while sticking it to hardworking Americans.’
During such hard economic times, how can Michelle Obama justify spending over 10 million dollars of U.S. taxpayer money on luxurious vacations?
The American people expect a president to be at the White House working night and day to solve the problems of this nation.
Sure, it would definitely be understandable to take a day or two off here and there, but the truth is that the president should be one of the hardest working people in the country.
Instead, Obama just seems to do less and less the longer that he is in the White House. In fact, there have been numerous reports that Barack Obama barely even interacts with members of his own party in Congress anymore.
Our country is literally falling apart and we have a total lack of leadership at the top.
Sadly, there does not appear to be much hope on the horizon at the moment.
Right now, Newt Gingrich is leading the race for the Republican nomination. If he wins the nomination, the American people will have a choice between two candidates that are almost identical in 2012. The sad truth is that Newt Gingrich is not a conservative, and he never will be. Rather, he is a big time establishment stooge that would keep marching America down the same road that Bush and Obama have been taking us. When you sit down and really compare the Obama agenda to the Gingrich agenda, you will quickly find that they are almost entirely identical. If the Republican Party nominates Newt Gingrich, it will be a complete and utter disgrace.
The reality is that we desperately need real leadership and real solutions. Europe is on the verge of a massive financial meltdown. If things take a wrong turn, we could easily be looking at a financial crisis even worse than the one we saw back in 2008.
Many in the mainstream media are using the word “recovery” now that the official unemployment has fallen to 8.6%, but as Mac Slavo recently pointed out, the real rate of unemployment is still up around 22 percent.
The official government numbers assume that 315,000 Americans “left the labor force” in November. At a time when our population is constantly expanding, that seems like a shaky assumption at best.
The reality, as many of you out there are experiencing, is that times are hard and millions of Americans are becoming increasingly desperate.
For example, just check out what happened in the Sacramento area recently. One church was hit by copper thieves three nights in row….
Members of a Carmichael church that had been targeted by copper thieves for two nights in a row managed to help nab the suspected thieves when the greedy pair returned for a third night.
Nobody is off limits for thieves these days. If you can believe it, people are even stealing food from food pantries now.
This country is in a massive amount of economic trouble, and we desperately need some solutions.
But perhaps we should be thankful that Obama is taking so many vacations.
After all, just about everything he has done so far has ended up making things even worse.
Perhaps it is better if he simply does nothing at all.
But at some point this country is going to need real leadership and real solutions.
So what do all of you think?
Do you think that there is any hope for this country on the horizon?
If the U.S. government were to shut down for a while, would that really be such a bad thing? Right now everyone in the mainstream media is freaking out as if the world is going to end, but the truth is that there have been government shutdowns before. The apocalypse is not going to happen if there is another shutdown. If Congress could find a way to get our troops and our border patrol agents paid, then what would be so bad about the government taking a “vacation” for a while? After all, when was the last time that either the Republicans or the Democrats did anything that was actually good for America? It has not mattered which political party has been in power – over the past couple of decades our “representatives” in Washington D.C. have passed an endless parade of bad laws and have gotten us into the biggest mountain of debt in the history of the world. They literally seem unable to do anything right. So would it really be so bad if a government shutdown slows them down for a while? If our politicians are going to act like a bunch of idiots, why not let them shut it down?
Think of it this way – if you could eliminate all of the laws passed under George W. Bush and Barack Obama would you do it?
I think that most Americans would.
Almost every single law that has been passed over the past couple of decades has been bad for America.
But many Americans seem to be going into a panic at the thought that the “almighty government” might not be operating for a few days.
Many Americans seem to have bought into the lie that the federal government is the most important institution in our country.
But this is never what our founding fathers intended. Our founding fathers intended for the federal government to be very limited. Unfortunately, we have turned our backs on the principles of our founding fathers.
So exactly what is this fight between the Republicans and the Democrats all about? Why have we been brought to the brink of a government shutdown?
We keep hearing that it is all about cutting the budget. In fact, House Speaker John Boehner says that his party is “damn serious about it”.
But that is a joke. The federal budget deficit for this year is going to be approximately $1.6 trillion dollars. The Republicans were asking for just $61 billion in budget cuts (3.8% of the budget deficit) and there are rumors that Republican and Democratic negotiators have agreed to a figure of $38 billion in budget cuts.
Is this why the Tea Party was sent to Washington?
$38 billion would just be 2.4 percent of the $1.6 trillion dollar deficit.
Wow, that is really wielding the budget cutting axe!
Look, the U.S. government cannot spend a single penny from now on without Republicans going along with it.
The Republicans control the House of Representatives. Barack Obama and the Senate will not have a single dime to spend unless they can get the House to go along with it.
If the Democrats want money to implement Obamacare then they have to get the Republicans to go along with it.
If the Democrats want to give money to the EPA to implement Obama’s “green agenda” then they have to get the Republicans to go along with it.
In fact, pretty much whatever the Democrats want to do, they have to get the Republicans to agree to fund it.
So if you don’t like what Obama and the Democrats are doing, don’t just blame them.
Blame the Republicans as well.
Both parties are deeply corrupt and both parties have gotten us to the point we are at.
Sadly, it looks like any deal that the Republicans and the Democrats are going to agree to is going to include virtually everything that the Democrats want.
It is going to include full funding for Obamacare.
It is going to include full funding for Planned Parenthood.
It is going to include full funding for NPR.
It is going to include full funding for the EPA.
So what are the Republicans going to get?
$38 billion in spending cuts?
Is that supposed to be a “deal”?
The truth is that Boehner is a joke and he is not serious about cutting the federal budget.
But if we don’t start seriously cutting the federal budget we are heading for complete and total disaster.
David Stockman, who served as budget director under Ronald Reagan, says that if Congress is not serious about getting our financial house in order that a government shutdown could be precisely the kind of wake up call that we need….
If the Smithsonian, the Parks Service and the Cherry Blossom Festival get delayed or canceled, it’s the wakeup call that we really needed. The fools inside the Beltway are borrowing $100 billion month in and month out, and there’s nobody left in the world buying except the central banks—the Fed and the people’s printing press of China. There’s no way that’s sustainable or viable. It’s simply building up pressure in the monetary system that’s going to blow sky-high.
Look, the United States is heading straight for financial armageddon. This is a crisis of historic proportions. In a previous article on U.S. government finances, I detailed some absolutely horrifying statistics about the debt crisis that the U.S. government is facing….
*If you divide the national debt up equally among all U.S. households, each one owes a staggering $125,475.18.
*The federal government has borrowed 29,660 more dollars per household since Barack Obama signed the economic stimulus law two years ago.
*During Barack Obama’s first two years in office, the U.S. government added more to the U.S. national debt than the first 100 U.S. Congresses combined.
*In the new budget that the Obama administration has proposed, the U.S. government would spend 3.7 trillion dollars in 2012 and by 2021 the U.S. government would be spending a whopping 5.6 trillion dollars per year.
*The U.S. government currently has to borrow approximately 41 cents of every single dollar that it spends.
*The total compensation that the federal government workforce earned last year came to a grand total of approximately 447 billion dollars.
*The U.S. national debt is currently rising by well over 4 billion dollars every single day.
*The U.S. government is borrowing over 2 million more dollars every single minute.
*The U.S. national debt is over 14 times larger than it was just 30 years ago.
*Unfunded liabilities for entitlement programs such as Social Security and Medicare are estimated to be well over $100 trillion, and nobody in the U.S. government seems to have any idea how we are actually even going to come close to meeting all of those obligations.
*If you were alive when Jesus was born and you spent one million dollars every single day since that point, you still would not have spent one trillion dollars by now. But this year alone the U.S. government is going to go about 1.6 trillion dollars more into debt.
*If the federal government began right at this moment to repay the U.S. national debt at a rate of one dollar per second, it would take over 440,000 years to pay off the national debt.
But even if the Republicans got every single thing that they have been demanding it would make essentially no difference as far as our national debt crisis is concerned. It would basically be like spitting into Niagara Falls.
So which political party has the correct position in this battle?
Neither of them. In fact, both political parties are a joke. They are both acting like a bunch of idiots just like they have been for decades.
So let them shut it down. The truth is that the number one threat to our liberties and freedoms right now is our own federal government.
In a recent article, J.B. Williams talked about why he thinks that it would be a really good idea to shut the government down….
I say, shut it down! The federal government has done as much to harm the union of states as it has ever done to improve freedom and liberty in America. We will be better off without a federal government, with each state able to fund and govern itself better than the Fed ever could.
Extreme threats demand extreme measures, and nothing threatens the future freedom and prosperity of the United States more than our own federal government. Enemies beyond, we can deal with. It’s the enemy within which threatens us most today. It’s time to shut it down and reset.
Just think about a few of the ways that our own federal government violates our liberties and freedoms every single day….
*If you want to get on an airplane in America today, you must either go through one of the incredibly intrusive full body scanners that are going into all U.S. airports and let airport security goons gawk at your exposed body, or you must allow airport security goons to feel you up using the new “enhanced pat down” techniques they are being instructed to employ.
*Thanks to the Patriot Act, if you are identified as a “terrorist”, you suddenly lose all of your constitutional rights. We are told that detaining American citizens indefinitely and subjecting them to “enhanced interrogation” techniques will keep us all safer.
*The federal government controls our lives so tightly that now they even tell us what kinds of light bulbs we are allowed to buy.
*Barack Obama has been pushing a plan that would create a national database that will store the DNA of all individuals who have been arrested, even if they end up not being convicted of a crime.
*Just about anything can be used against you in court these days. In one of the very first military commissions held under the Obama administration, a U.S. military judge ruled that confessions obtained by threatening the subject with rape are admissible in court.
*The federal government listens to our cell phones whenever they want and they require that all cell phone companies must be able to pinpoint the locations of all of their customers to within 100 meters.
*According to FBI Director Robert Mueller, “homegrown terrorists” represent just as much of a threat to American national security as al-Qaeda does.
*In Washington D.C., if you do not submit to “random bag checks” while riding the Metro there is a good chance that you could receive a follow-up visit by the FBI or by the Department of Homeland Security.
*If you make food “incorrectly” there is a good chance that you will get raided by the federal government. In fact, the feds raided an Amish farmer at 5 AM in the morning because they claimed that he was was engaged in the interstate sale of raw milk in violation of federal law.
So in light of how extreme our federal government has become, is there anyone out there that still thinks it would be a “crisis” if the government was to shut down for a while?
If our government is going to take away our liberties and freedoms instead of protecting them, then why would it be a bad thing if it shut down for a short time?
It might just get some of the control freaks off our backs for a while.
Yes, we do need to make sure our military men and women are paid. We also need to make sure that our border patrol agents are paid. But if Congress could actually get that accomplished it wouldn’t be too bad at all if the government were to shut down for an extended period of time.
So what do all the rest of you think? Feel free to leave a comment with your opinion about the possibility of a government shutdown below….
Barack Obama recently made the following statement to American families that are struggling to survive in this economy: “If you’re a family trying to cut back, you might skip going out to dinner, or you might put off a vacation.” A few days after making that statement Obama sent his wife and children off on yet another vacation, this time to a luxury ski hotel in Vail, Colorado. But the Obamas are not the only ones enjoying the high life. Wealthy corporate executives and greedy Wall Street fatcats insist that profit margins are too tight to hire more American workers, and yet sales of luxury cars, private jets and vacation homes are soaring. Meanwhile, most American families are going through economic hell right now. In 2010, more Americans than ever before were living below the poverty line. Over 4 million Americans have been unemployed for more than a year, and over 5 million Americans are at least two months behind on their mortgage payments. As the Obamas and wealthy corporate executives jet off to fancy ski resorts, half of all American workers are earning $505 or less per week and 55 percent of American families are living paycheck to paycheck. Something is very wrong with this picture.
So is there anything wrong with working hard and enjoying the fruits of success? Of course not, as long as it was done honestly and not on the backs of the American taxpayers. But the truth is that many of the corporate executives that are enjoying luxury vacations right now would not even have companies to run if the American taxpayers had not stepped in and bailed them out during the financial crisis. Thanks to the U.S. government and the Federal Reserve, Wall Street bankers and top corporate executives are once again enjoying bonuses that most of us would consider obscene.
Meanwhile, most of the rest of the country is suffering very deeply.
Over the past several decades, the biggest financial institutions and the biggest corporations have worked really hard to “fix” the rules of the game in their favor. The truth is that our economy is no longer a “free market” capitalist system. Rather, what we have now is more accurately described as “corporatism” or “neo-feudalism”. The big corporations dominate almost everything, and whatever they don’t dominate the government does.
One of the key features of a “corporatist” system is that it tends to funnel all the wealth to the very top.
Back in 1976, the top 1 percent of earners in the United States took in 8.9 percent of all income. By 2007, that number had risen to 23.5 percent.
There are two different Americas today. There is the America of the gated communities, the private planes and the good life, and there is the America of declining wages, thrift stores and rising desperation.
What is saddest of all is that the most vulnerable people in society often suffer the most from all of this.
According to one recent study, approximately 21 percent of all children in the United States were living below the poverty line in 2010.
Do you think that the Obamas are thinking about any of this while they are enjoying their stay at a luxury ski hotel in Vail, Colorado?
The truth is that leadership is not just about words. Leadership is about setting an example.
Back in August, Michelle Obama took her daughter Sasha and 40 of her friends for a vacation in Spain.
So what was the bill to the taxpayers for that little jaunt across the pond?
It is estimated that vacation alone cost U.S. taxpayers $375,000.
Hey, Barack Obama won the most votes in 2008 and so if he wants his family to get as much enjoyment out of these four years as they can that is his prerogative.
However, if he wants to tell American families that they “might put off a vacation” after all the vacations that the Obamas have taken over the past two years then he is just being a massive hypocrite.
According to the New York Post, Barack Obama enjoyed a total of 10 separate vacations that stretched over a total of 90 vacation days during the years of 2009 and 2010.
During his first two years in office, he also managed to play 29 rounds of golf.
Oh, but it is the rest of us that have to cut back on our vacations.
But it is not just the Obamas that are enjoying the high life right now.
The wealthy have recovered nicely from the “recession” and now they are spending money by the gobs once again.
According to Moody’s Analytics, the wealthiest 5% of households in the United States account for approximately 37% of all consumer spending.
Life is very good in America if you have got enough money.
A recent article in USA Today detailed some of the things that wealthy corporate executives are spending money on in 2011….
Luxury and high-end marketers have picked up on what they hope is a growing trend, offering products that bank on a looming spending spree. Germany’s PG-Bikes is rolling out the $80,000 Black Trail, a battery-powered bicycle. Swiss watchmaker Richard Mille is selling $525,000 timepieces. Steinway has launched a John Lennon-themed grand piano — at $90,000 and up. After selling out a $245,000 model, automaker Porsche is planning the 918 Spyder, a hybrid car that could sell for more than $630,000.
Nearly all luxury brands experienced a resurgence in 2010. Just check out some of the sales increases for luxury car brands….
At the exact same time, however, life is getting really, really hard for the rest of America.
As I wrote about yesterday, the U.S. middle class continues to be decimated even in the midst of this “economic recovery”.
There are tens of millions of Americans that would like to have a full-time job that are not able to get a full-time job. The number of Americans on food stamps has gone from about 26 million at the start of 2007 to 43 million today and it continues to set a brand new record every single month. One out of every six Americans is now enrolled in at least one anti-poverty program run by the federal government.
Our economy has become a complete and total nightmare.
Over the past couple of days some of the readers of this column have been sharing some of their economic horror stories. But they are far from alone. There are literally millions of Americans with economic horror stories out there. It is just that we don’t get to hear too many stories from the “other America” on our televisions.
The following stories of economic pain are from people just like you and me. Times are incredibly hard for most of America right now, and they are only getting harder with each passing month….
My mother is unemployed. She is 61 years old, has 25 years of experience working for a major telecommunications corporation, and has a four-year degree. I watch her send application after application to employers with no response. I watch her get contacted by recruiters who say she is a ‘perfect fit’ for a job and never deliver. I watch her slide into depression and staying in bed many hours of the day.
I am 38 years old, I have mental illness, and I recently lost my job as a delivery driver because the owner sold his business to a competitor.
I don’t believe that either my mother or I will ever be employed again. I am beginning to feel that I am permanently in the world of the unemployed.
I graduated college in May 2000 with a Bachelors degree in Broadcasting/Minored in History. I have worked for major corporations as an Enterprise Sales Consultant selling Servers. I was a Network Engineer for Qwest Communications. I even worked for the Federal Government and held a Security Clearance for 4 years. I also won Dell Small Business Sales Consultant of the quarter as well. But since I don’t have an active clearance anymore no one wants to hire me in D.C. I lost my job in 07/2010 and from 07/2010-Present I have been unemployed. My food stamps were also recently cut off last month since the State of Virginia decided that for a household of 1 you can’t make more than $1178 a month. I make $1250 a month in Unemployment compensation before taxes so according to the Government I am too rich to receive Food stamps now. My Rent, Gas and Car insurance is $1000 a month and I am holding on for dear life. I am currently in the process of declaring Chapter 7 Bankruptcy and using my tax return to pay the attorney $1500 to file. That leaves me with only #250 a month for food, water and cell phone.
I have a list compiled in my Google email with approximately 784 applications I have filled out for every government agency, defense contractor and job available in the Washington, DC area. I even applied to Carmax and my old job in college waiting tables at red Lobster and the moving company I used to work at during the summers in college. If its bad for someone like me with over 10 years of Sales, Server/computer experience, Investigations and Network Engineering than I can’t imagine how bad it is for people that just have a high school diploma. I have been on one interview out of the almost 1000 jobs I have applied to (It takes about 2 hours to apply to one job). The one interview I went on offered me less than my unemployment gives me at $8 an hour. I can sit at home and make more money on unemployment than 80% of the jobs that I have applied too and even those jobs don’t call me. Is this what America has become? Is this what I sacrificed 5 years of my life in college from 17 years old to 21 years old and spent $40,000 to get a worthless degree that won’t even get you hired?
Well, My family has been ripped to shreds alright.
Overall combined (My father, and myself) make about 60k a year. We can barely survive we keep looking to cut things, and make things cheaper but it’s just not working fast enough.
My wife can’t find a job, and now student loans are starting to become issues. (won’t go in to further details).
Tax returns taken, and various other things, Can’t even afford dental care. We don’t even get to go out anymore, and lucky to get any type of snacks. Just so you know there are 5 people living in this house.
The only reason I am not out on the street is that when I had money I paid off my mortgage.
However, because I did that, my food stamp allotment is only $25 a month. The heating assistance I get only paid for less than one months’ heat out of the six months I need here in Pennsylvania. All other expenses use up what’s left, so you learn to eat at home; I try not to leave the house because it’s going to cost me money.
I blame Congress for destroying America. They have given tax breaks to themselves and their rich friends at our expense. Did you know that anybody who serves 5 years in Congress gets a FULL pension at age 62? Us peasants work for 45 years and then if we retire at age 62 we are forced to give up 25% of what we earned.
I lost my house, my family was split, and all my savings is gone.
I have lost hope. I served in the military, went to college and have high tech skills. My country doesn’t give a ***** about me. The bankers are as evil as the communists and I hate them.
I’m also 38, and have worked in IT since the mid 90s. I lost my full time job in April ’03, and have only been able to find short term temporary work since. The contracts started to get shorter and fewer as the years went on, so in spring ’10 I retrained to be an Emergency Medical Technician (EMT) but have not been able to find work in the last 9 months. An ambulance company I applied with said that they have hundreds of applications in several Northern CA counties but no job openings. And health care jobs are supposed to be on the the only areas of growth. I deliver pizzas for cash on and off and am getting unemployment.
I lost track of how many resumes I’ve sent out during the past several months. My neighbors think I’m trying to win the Publishers Clearing House sweepstakes or something (yeah, that would help too! Ha!)
Maybe I should go back to school and become an RLP (Rejection Letter Professional).
The rent at the place I lived was so high that I couldn’t afford it on a school bus driver’s salary, which I was doing for the past few years, because in spite of 30 years clerical experience, where I performed every function from clerk typist to executive legal secretary, I could not find employment. So I applied for subsidized housing and was forced to move back to Chicago, where the crime rate is very high in certain areas.
Before I moved I was getting $200 in food stamps, but now that I am in subsidized housing, I have to go and reapply and if I get anything at all, I have heard that it will be about $52 a month! Although the rent is subsidized, I have to pay for my own heat, and the building in which I live is completely electric! Energy assistance doesn’t cover it. They give with one hand and take away with the other.
All of the people above are still “surviving”, but what do you think is going to happen to many of them as the cost of living goes up dramatically? Brent crude just hit $108 a barrel and the UN says that the global price of food recently hit a new all-time high.
Americans on fixed incomes or that are on government assistance are going to be absolutely devastated if prices for basics such as food and gas rise substantially.
Not only that, but budget cuts on the federal, state and local levels are also going to hurt many of these people deeply.
But this is where we are at as a nation. A small privileged class is enjoying the high life while a rapidly growing poverty class pleads for the government to toss them some more crumbs.
The American people deserve better than this. They deserve an economy that will provide them with good jobs which will enable them to pay their mortgages and feed their families.
Unfortunately, the U.S. economy is dying. The number of good jobs is actually declining. The middle class is being systematically wiped out.
The answer is not to “tax the rich” so that we can toss the rapidly growing poverty class a few more crumbs. The answer is to radically transform our economy back into the kind of economy our founding fathers originally intended.
But wealthy corporate executives and politicians such as Barack Obama are not going to have any of that. Those sitting on top don’t want any real change to happen. Sadly, the general population has become so dumbed-down that they don’t even know the questions that they should be asking.
So unfortunately it appears we are going to keep heading down the exact same economic path that we have been heading for decades. The middle class will keep being ripped apart and politicians like George W. Bush and Barack Obama will just keep on smiling.