Radical Leftists Unleash Anti-Trump Riots Starting On March 19th

Democracy SpringMany of the exact same groups that participated in Occupy Wall Street and helped organize protest rallies in Ferguson and Baltimore are now promising to bring us “the largest civil disobedience actions in a generation”.  I recently wrote about the trouble that radical leftists have caused by attempting to disrupt Trump campaign events, but now there is a very organized effort to turn this into a national movement.  On March 19th, thousands of angry protesters will descend on Trump Tower in New York City to denounce Donald Trump’s “fascist policies”, and on April 2nd dozens of leftist organizations will join together to launch “Democracy Spring” in Philadelphia.  From there, large numbers of liberal activists will march to Washington D.C. where they will “risk arrest” during a “peaceful” sit-in at the U.S. Capitol from April 11th to April 18th.  If the radical left is this freaked out about Donald Trump now, how bad will things get if he actually becomes the Republican nominee?

I suppose that it was only a matter of time before the radical left began to specifically target Trump properties.  I hope that Trump has good security, because it will definitely be tested starting tomorrow

Left-wing demonstrators have announced their latest anti-Trump event – a march on Trump Tower in New York City to protest against The Donald’s “fascist policies”.

A Facebook page for the rally outlines the plan, organized by a group called ‘Cosmopolitan Antifascists’, to march on the building at 2pm on Saturday afternoon.

“Donald J. Trump has made headlines in recent months with his divisive rhetoric, hate speech, and extremist plans to “make America great again”. We, in fact, believe this will do the opposite to this nation. Trump’s policy threatens many of us in the Black, Latino, LGBT, Muslim, and other communities,” states the page.

According to the Facebook page for “Cosmopolitan Antifascists”, 5,000 people plan to show up and 15,000 more are “interested” in this event.

Will it turn out to be a completely peaceful protest?

Let’s certainly hope so.

Perhaps even more disturbing is what is going to happen in early April.  Dozens of far left groups have gotten behind a movement that has been officially dubbed “Democracy Spring”.

Obviously, that name was chosen to conjure up memories of the “Arab Spring”, and we all remember how “peaceful” that was.

The official website of Democracy Spring tells us the following about the goals…

This spring, in the heart of the primary season, as the national election begins to take center stage, Americans of all ages, faiths, political perspectives, and walks of life will bring the popular cry for change to Washington in a way that’s impossible to ignore: with nonviolent civil disobedience on a historic scale.

We will demand that Congress listen to the People and take immediate action to save our democracy. And we won’t leave until they do — or until they send thousands of us to jail, along with the unmistakable message that our country needs a new Congress, one that that will end the legalized corruption of our democracy and ensure that every American has an equal voice in government.

Do you understand the threat that is being made there?

They are purposely planning to break the law and get arrested.  In fact, their website says that there are already more than 2,000 people that have “pledged to risk arrest” between April 11th and April 18th…

The campaign will begin on April 2nd with a march from the Liberty Bell in Philadelphia to Washington, D.C. where thousands will gather to reclaim the US Capitol in a powerful, peaceful, and massive sit-in that no one can ignore. Over 2,000 people have already pledged to risk arrest between April 11th-18th in what will be one of the largest civil disobedience actions in a generation.

And the list of groups that are backing this movement reads like a who’s who of radical leftist organizations…

15 Now Philly
99Rise
100 Grannies for a Livable Future
act.tv
African American Ministers in Action
American Ethical Union
American Family Voices
American Federation of Labor and Congress of Industrial Organizations (AFL-CIO)
Avaaz
Backbone Campaign
Big Apple Coffee Party
Brave New Films
Catholics United
Center for Biological Diversity
Center for the Working Poor
Citizen Action NY
Code Pink
Coffee Party USA
Columbus Campaign for Arms Control
Conscious Elders Network
Courage Campaign
Ctzn Well
Demand Progress
Democracy Chronicles
Democracy Coffee
Democracy for America
Democracy Matters
Democratic Socialists of America
Demos
Dolores Huerta Foundation
East Coast Cannabis Coalition (ECCC)
East Point Peace Academy
Elder Activists
Elders Climate Action
Every Voice
Energy Action Coalition
Food & Water Watch
Franciscan Action Network
Friends of the Earth
Get Money Out – Maryland
Human Earth Animal Liberation (HEAL)
Hightower Lowdown
Institute for Policy Studies
Interfaith Moral Action on Climate (IMAC)
Iowa Citizens for Community Improvement
Jewish Voice for Peace
Just Foreign Policy
Leadership Development Initiative
March Against Corruption
March Against Monsanto
Maryland Committee to Amend
Massachusetts Communities Action Network (MCAN)
MAYDAY.US
Money Out! People In!
MoveOn
National Organization for Women (NOW)
National LGBTQ Task Force Action Fund
National People’s Action
Network of Spiritual Progressives/ Tikkun Magazine
New Hampshire Rebellion
Occupy Catholics
Office of the Americas
Other 98%
PA United to Amend
Pay 2 Play
Peace Action
People Demanding Action
People for Bernie
People for the American Way
People Over Politics
People’s Empowerment Project
Pride at Work-New York City/Long Island
Progressive Change Campaign Committee (PCCC)
Progressive Democrats of America
Public Citizen
Retail, Wholesale, and Department Store Union (RWDSU)
ReThink Media
RootsAction
Rootskeeper.org
Rootstrikers
Shalom Center
Small Planet Institute
Social Security Works
South Central Wisconsin United To Amend
Stamp Stampede
Stop Police Terror Project DC
Sustain US
Unitarian Universalist Association
Unitarian Universalist Church of Delaware County
United Native Americans
United for Peace and Justice
United Students Against Sweatshops (USAS)
United States Student Association (USSA)
United We Dream
U.S. Climate Plan
Ursulines of Tildonk for Justice & Peace
We are Woman
We the People Massachusetts
WildEarth Guardians
WolfPAC
Women’s Promise
Working Families Party
Workmen’s Circle
World Beyond War
Yes Men
Young Democratic Socialists
Youth Jobs Coalition / We Have a Future

This is just the beginning.  The radical left has won the hearts and minds of millions of our young people, and many of these groups are preaching a message of anger, frustration and direct confrontation.

For now, let’s hope that these “protests” are at least somewhat peaceful.  But throughout history, leftist revolutions have almost always turned violent at least to a certain degree.

And let there be no confusion – the radical left very much wants a revolution.  There is a reason why Bernie Sanders uses that word so much in his applause lines.  It is a buzzword that evokes some very powerful imagery for the radical left.

America is changing, and not for the better.  From this point forward, the radical left in America is going to become much more active, and in the end that is going to have dramatic consequences for all of us.

We Are Being Killed On Trade – Rapidly Declining Exports Signal A Death Blow For The U.S. Economy

Abandoned Packard Automobile Factory - Photo by Albert DuceExports fell precipitously during the last two recessions, and now it is happening again.  So how in the world can anyone make the claim that the U.S. economy is in good shape?  On my website I have been repeatedly pointing out the parallels between the last two major economic downturns and the current crisis, and I am going to discuss another one today.  Since peaking in late 2014, U.S. exports have been steadily declining, and this is something that we never see outside of a major recession.  On the chart that I have shared below, the shaded gray bars represent the last two recessions, and you can see that exports of goods and services plunged dramatically in both instances…

Exports Of Goods And Services - Public Domain

And this chart does not even show the latest numbers that we have.  During the month of January, U.S. exports fell to a five and a half year low

The U.S. trade deficit widened more than expected in January as a strong dollar and weak global demand helped to push exports to a more than 5-1/2-year low, suggesting trade will continue to weigh on economic growth in the first quarter.

The Commerce Department said on Friday the trade gap increased 2.2 percent to $45.7 billion. December’s trade deficit was revised up to $44.7 billion from the previously reported $43.4 billion. Exports have declined for four straight months.

Because our exports are falling faster than our imports, our trade deficit is blowing out once again.  Every year we buy hundreds of billions of dollars more from the rest of the world than they buy from us, and this is systematically wrecking our economy.  Over the past several decades, we have lost tens of thousands of manufacturing facilities, millions of good paying manufacturing jobs, and major exporting nations such as China have become exceedingly wealthy at our expense.

We are being absolutely killed on trade, and yet very few of our politicians ever want to talk about this.

A brand new study that was recently discussed in the New York Times is bringing some renewed attention to these problems.  It turns out that the promised “benefits” of merging the U.S. economy into the global economic system simply have not materialized…

In a recent study, three economists — David Autor at the Massachusetts Institute of Technology, David Dorn at the University of Zurich and Gordon Hanson at the University of California, San Diego — raised a profound challenge to all of us brought up to believe that economies quickly recover from trade shocks. In theory, a developed industrial country like the United States adjusts to import competition by moving workers into more advanced industries that can successfully compete in global markets.

They examined the experience of American workers after China erupted onto world markets some two decades ago. The presumed adjustment, they concluded, never happened. Or at least hasn’t happened yet. Wages remain low and unemployment high in the most affected local job markets. Nationally, there is no sign of offsetting job gains elsewhere in the economy. What’s more, they found that sagging wages in local labor markets exposed to Chinese competition reduced earnings by $213 per adult per year.

Another study conducted by some of the same researchers discovered that 2.4 million American jobs were lost between 1999 and 2011 due to rising Chinese imports.

When are we going to finally wake up?

The middle class in America is being absolutely shredded, and yet only a few of us seem to care.

Meanwhile, global trade as a whole continues to slow down at a very frightening pace.  We just learned that the China Containerized Freight Index has now dropped to the lowest level ever recorded.  The following comes from Wolf Richter

The China Containerized Freight Index (CCFI), published weekly, tracks contractual and spot-market rates for shipping containers from major ports in China to 14 regions around the world. Unlike most Chinese government data, this index reflects the unvarnished reality of the shipping industry in a languishing global economy. For the latest reporting week, the index dropped 4.1% to 705.6, its lowest level ever.

How many numbers like this do we have to get before we will all finally admit that we are in the midst of a major global economic meltdown?

Here in the United States, the recent rally in the stock market has most people feeling pretty good about things these days.  But the truth is that there are ups and downs during any financial crisis, and this recent rally is putting the finishing touches on a very dangerous leaning “W” pattern that could signal a big dive ahead.

Harry Dent, the author of “The Demographic Cliff: How to Survive and Prosper During the Great Deflation Ahead“, has shown that this leaning “W” pattern is part of a huge “rounded top” for the S&P 500.  The following is a brief excerpt from one of his recent articles

The bull market from early 2009 into May 2015 looks just like every bubble in history, and I’m getting one sign after the next that we did indeed peak last May. The dominant pattern in the stock market is the “rounded top” pattern:

S&P 500 Rounded Top

After trading in a steep, bubble-like channel from late 2011 into late 2014, with only 10% maximum volatility top to bottom, the market finally lost its momentum… just as the Fed finished tapering its QE. That’s because the Fed was the primary driver in this stock bubble in the first place!

Now is not the time to relax at all.

In fact, now is the time to sound the alarm louder than ever.

That is one reason why my wife and I have started up a new television program.  It will be airing on Christian television, but it will also be available on YouTube as well…

As I have said before, 2016 is the year when everything changes.

So don’t be fooled just because the stock market had a couple of good weeks.  The truth is that global economic activity is slowing down significantly, geopolitical instability continues to get even worse, and this political season has caused very deep, simmering tensions in the United States to rise to the surface.

Let us hope that we have a few more weeks of relative stability like we are currently experiencing so that we can have more time to get prepared, but I certainly wouldn’t count on it.

Trump Rallies Reveal Increased Tensions Among Americans As This Nation Plunges Toward Civil Unrest

Anti-Trump Protesters In Chicago - Photo by nathanmac87America is coming apart at the seams, and Trump rallies have become the latest flashpoint for the rising tide of civil unrest that is sweeping the nation.  For years, I have been writing about the increasing levels of anger and frustration in this country, but now they are reaching a fever pitch.  And rather than channeling all of our anger and frustration into solving our problems, we have allowed ourselves to become deeply divided and many Americans seem to be taking glee in fighting with one another.  Instead of learning to hate one another, we should be learning how to love one another.  Unfortunately, America has chosen another path, and 2016 is very rapidly starting to look very much like the chaotic political year of 1968.  No matter how the rest of this election season plays out, it appears that we have entered a time of violence, chaos, civil unrest and greatly increased tension among Americans.

On Friday, thousands of radical leftists showed up at a planned Trump rally at the University of Illinois at Chicago with the express purpose of disrupting it.  Fortunately Donald Trump cancelled the rally, because there was a very real possibility that mass violence could have erupted.  The following description of what happened comes from Wikipedia

On March 11, 2016, the Donald Trump presidential campaign canceled a planned rally at the University of Illinois at Chicago (UIC), in Chicago, Illinois, citing “growing safety concerns” due to the presence of thousands of protesters in and outside of his rally[3]. Thousands of anti-Trump demonstrators responding to civic leaders’ and social media calls to shut the rally down had gathered outside the arena, and several hundred more filled seating areas within the UIC Pavilion, where the rally was to take place. When the Trump campaign announced that the rally would not take place, there was a great deal of shouting and a few small scuffles between Trump supporters and anti-Trump protestors.

The Daily Caller has identified three groups that were heavily involved in organizing the planned disruption of the Trump rally in Chicago.  Those three groups are ANSWER (Act Now to Stop War and End Racism) Chicago, the Illinois Coalition of Immigrant and Rights Reform, and La Raza Chicago.

In addition, MoveOn.org also appears to have been involved in what took place in Chicago.  The following comes from Infowars

“Mr. Trump and the Republican leaders who support him and his hate-filled rhetoric should be on notice after tonight’s events,” the George Soros funded MoveOn web page states. “To all of those who took to the streets of Chicago, we say thank you for standing up and saying enough is enough. To Donald Trump, and the GOP, we say, welcome to the general election.”

Following the cancelled rally in Chicago, a radical leftist protester named Thomas Dimassimo attempted to storm the stage while Trump was speaking at an event in Dayton, Ohio.  This YouTube video contains footage of that chilling moment…

Thomas Dimassimo has been identified as a Bernie Sanders supporter, and even though his Twitter account has now been erased, this screenshot was taken while it was still up…

Marlon Bando Tweet

There was also another tweet where he said that his goal was “martrydom“.  I have seen some news reports that link Dimassimo to ISIS, but those reports are being disputed.  Either way, the fact that the Secret Service had to intervene to protect Trump from this lunatic is more than just a little bit alarming.

Following the incident in Dayton, a Trump rally in Kansas City was disrupted more than a dozen times by political agitators.  At one point, police actually used pepper spray on some of the protesters.

Scenes such as these are starting to cause many people to make direct comparisons between 2016 and 1968.

And if the chaos is this bad already, what will things look like during the general election?

Candidates on all sides should be calling for peace and calm, but instead they are pointing fingers at one another.

For example, Hillary Clinton is putting the full blame for the unrest on Donald Trump

Democratic presidential front-runner Hillary Clinton said this weekend that Trump is guilty of “political arson,” adding that “the ugly, divisive rhetoric we are hearing from Donald Trump and the encouragement of violence and aggression is wrong, and it’s dangerous,” The New York Times reported.

And Donald Trump is placing the blame at the feet of Bernie Sanders and Hillary Clinton

“You had professional disruptors, thousands of them, from Sanders and to a smaller extent, Hillary (Clinton),” he said of a Friday night event in Chicago that Trump canceled after chaos broke out there.

Unfortunately, most Americans have absolutely no idea where all of this is leading.

A house that is divided will fall, and America is now more divided than at any other time in my entire lifetime.

If there was a single set of values or principles that united us, it would be possible for us to come together as a nation and solve our problems.  But there isn’t.  We have rejected the values and the principles of our founders, and these days Americans are being pulled in dozens of different directions.  In fact, if you ask 100 different Americans what we need to do to get our country back on the right track you are probably going to get 100 different answers.

The chaos and violence around our political process is going to get a lot worse than this.  And we are going to see more communities erupt just like Ferguson and Baltimore did.

In the end, Americans are going to kill Americans, our cities are going to burn, and we are going to experience a period of governmental shaking unlike anything that we have ever seen before.

All of this could have been avoided if we could have simply learned to love one another.  But instead, we have allowed ourselves to be divided in just about every way imaginable, and the mainstream media is constantly tossing more fuel on the fire.

This isn’t about Donald Trump, Bernie Sanders, Hillary Clinton or any other politician.  Rather, this is about a once great country that is deeply, deeply divided and that is coming apart at the seams right before our very eyes.

May God have mercy on the late, great United States of America.

Americans Really, Really Hate The Government

Anger - Public DomainIf there is one thing that Americans can agree on these days, it is the fact that most of us don’t like the government.  CBS News has just released an article entitled “Americans hate the U.S. government more than ever“, and an average of recent surveys calculated by Real Clear Politics found that 63 percent of all Americans believe the country is heading in the wrong direction and only 28 percent of all Americans believe that the country is heading in the right direction.  In just a few days the first real ballots of the 2016 election will be cast in Iowa, and up to this point the big story of this cycle has been the rise of “outsider” candidates that many of the pundits had assumed would never have a legitimate chance.  Donald Trump, Ted Cruz and Bernie Sanders have all been beneficiaries of the overwhelming disgust that the American people feel regarding what has been going on in Washington.

And it isn’t just Barack Obama or members of Congress that Americans are disgusted with.  According to the CBS News article that I referenced above, our satisfaction with various federal agencies has fallen to an eight year low…

A handful of industries are those “love to hate” types of businesses, such as cable-television companies and Internet service providers.

The federal government has joined the ranks of the bottom-of-the-barrel industries, according to a new survey from the American Customer Satisfaction Index. Americans’ satisfaction level in dealing with federal agencies –everything from Treasury to Homeland Security — has fallen for a third consecutive year, reaching an eight-year low.

So if we are all so fed up with the way that things are running, it should be easy to fix right?

Unfortunately, things are not so simple.

In America today, we are more divided as a nation than ever.  If you ask 100 different people how we should fix this country, you are going to get 100 very different answers.  We no longer have a single shared set of values or principles that unites us, and therefore it is going to be nearly impossible for us to come together on specific solutions.

You would think that the principles enshrined in the U.S. Constitution should be able to unite us, but sadly those days are long gone.  In fact, the word “constitutionalist” has become almost synonymous with “terrorist” in our nation.  If you go around calling yourself a “constitutionalist” in America today, there is a good chance that you will be dismissed as a radical right-wing wacko that probably needs to be locked up.

The increasing division in our nation can be seen very clearly during this election season.  On the left, an admitted socialist is generating the most enthusiasm of any of the candidates.  Among many Democrats today, Hillary Clinton is simply “not liberal enough” and no longer represents their values.

On the other end of the spectrum, a lot of Republican voters are gravitating toward either Donald Trump or Ted Cruz.  Both of those candidates represent a complete break from how establishment Republicans have been doing things in recent years.

Now don’t get me wrong – I am certainly not suggesting that we need to meet in the middle.  My point is that there is absolutely no national consensus about what we should do.  On the far left, they want to take us into full-blown socialism.  Those that support Donald Trump or Ted Cruz want to take us in a more conservative direction.  But even among Republicans there are vast disagreements about how to fix this country.  Establishment Republicans greatly dislike both Trump and Cruz, and they are quite determined to do whatever it takes to keep either of them from getting the nomination.  The elite have grown very accustomed to anointing the nominee from each party every four years, and so the popularity of Trump and Cruz is making them quite uneasy this time around.  The following comes from the New York Times

The members of the party establishment are growing impatient as they watch Mr. Trump and Mr. Cruz dominate the field heading into the Iowa caucuses next Monday and the New Hampshire primary about a week later.

The party elders had hoped that one of their preferred candidates, such as Senator Marco Rubio of Florida, would be rising above the others by now and becoming a contender to rally around.

The global elite gathered in Davos, Switzerland are also greatly displeased with Trump.  Just check out some of the words that they are using to describe him

Unbelievable“, “embarrassing” even “dangerous” are some of the words the financial elite gathered at the World Economic Forum conference in the Swiss resort of Davos have been using to describe U.S. Republican presidential frontrunner Donald Trump.

Although some said they still expected his campaign to founder before his party picks its nominee for the November election many said it was no longer unthinkable that he could be the Republican candidate.

The truth is that the Republican Party represents somewhere less than half the population in the United States, and today it is at war with itself.  Supporters of Trump have a significantly different vision of the future than supporters of Cruz, and the establishment wing wants nothing to do with either candidate.

A lot of people seem to assume that since Trump is leading in the polls that he will almost certainly get the nomination.

That is not exactly a safe bet.

It is my contention that the establishment will pull out every trick in the book to keep either him or Cruz from getting the nomination.  And in order to lock up the nomination before the Republican convention, a candidate will need to have secured slightly more than 60 percent of all of the delegates during the caucuses and the primaries.

The following is an excerpt from one of my previous articles in which I discussed the difficult delegate math that the Republican candidates are facing this time around…

It is going to be much more difficult for Donald Trump to win the Republican nomination than most people think.  In order to win the nomination, a candidate must secure at least 1,237 of the 2,472 delegates that are up for grabs.  But not all of them will be won during the state-by-state series of caucuses and primaries that will take place during the first half of 2016.  Of the total of 2,472 Republican delegates, 437 of them are unpledged delegates – and 168 of those are members of the Republican National Committee.  And unless you have been hiding under a rock somewhere, you already know that the Republican National Committee is not a fan of Donald Trump.  In order to win the Republican nomination without any of the unpledged delegates, Trump would need to win 60.78 percent of the delegates that are up for grabs during the caucuses and primaries.  And considering that his poll support is hovering around 30 percent right now, that is a very tall order.

In the past, it was easier for a front-runner to pile up delegates in “winner take all” states, but for this election cycle the Republicans have changed quite a few things.  In 2016, all states that hold caucuses or primaries before March 15th must award their delegates proportionally.  So when Trump wins any of those early states, he won’t receive all of the delegates.  Instead, he will just get a portion of them based on the percentage of the vote that he received.

In 2016, more delegates will be allocated on a proportional basis by the Republicans than ever before, and with such a crowded field that makes it quite likely that no candidate will have secured enough delegates for the nomination by the time the Republican convention rolls around.

If no candidate has more than 60 percent of the delegates by the end of the process, then it is quite likely that we will see the first true “brokered convention” in decades.

If we do see a “brokered convention”, that would almost surely result in an establishment candidate coming away with the nomination.  That list of names would include Bush, Rubio, Christie and Kasich.

And if by some incredible miracle either Trump or Cruz does get the nomination, the elite will move heaven and earth to make sure that Hillary Clinton ends up in the White House.

For decades, it has seemed like nothing ever really changes no matter which political party is in power, and that is exactly how the elite like it.

Our two major political parties are really just two sides of the same coin, and they are both leading this nation right down the toilet.

2016 Market Meltdown: We Have Never Seen A Year Start Quite Like This…

Time Abstract - Public DomainWe are about three weeks into 2016, and we are witnessing things that we have never seen before.  There were two emergency market shutdowns in China within the first four trading days of this year, the Dow Jones Industrial Average has never lost this many points within the first three weeks, and just yesterday we learned that global stocks had officially entered bear market territory.  Overall, more than 15 trillion dollars of global stock market wealth has been wiped out since last June.  And of course the markets are simply playing catch up with global economic reality.  The Baltic Dry Index just hit another new all-time record low today, Wal-Mart has announced that they are shutting down 269 stores, and initial jobless claims in the U.S. just surged to their highest level in six months.  So if things are this bad already, what will the rest of 2016 bring?

The Dow was up just a little bit on Thursday thankfully, but even with that gain we are still in unprecedented territory.  According to CNBC, we have never seen a tougher start to the year for the Dow than we have in 2016…

The Dow Jones industrial average, which was created in 1896, has never begun a year with 12 worse trading days. Through Wednesday’s close, the Dow has fallen 9.5 percent. Even including the 1.3 percent gains as of noon Thursday, the Dow is still down nearly 8 percent in 2016.

But even with the carnage that we have seen so far, stocks are still wildly overpriced compared to historical averages.  In order for stocks to no longer be in a “bubble”, they will still need to decline by about another one-third.  The following comes from MarketWatch

Data from the U.S. Federal Reserve, meanwhile, say U.S. nonfinancial corporate stocks are now valued at about 90% of the replacement cost of company assets, a metric known as “Tobin’s Q.” But the historic average, going back a century, is in the region of 60% of replacement costs. By this measure, stocks could fall by another third, taking the Dow all the way down toward 10,000. (On Wednesday it closed at 15,767.) Similar calculations could be reached by comparing share prices to average per-share earnings, a measure known as the cyclically adjusted price-to-earnings ratio, commonly known as CAPE, after Yale finance professor Robert Shiller, who made it famous.

Of course the mainstream media doesn’t seem to understand any of this.  They seem to be under the impression that the bubble should have lasted forever, and this latest meltdown has taken them totally by surprise.

Ultimately, what is happening should not be a surprise to any of us.  The financial markets always catch up with economic reality eventually, and right now evidence continues to mount that economic activity is significantly slowing down.  Here is some analysis from Brandon Smith

Trucking freight in the U.S. is in steep decline, with freight companies pointing to a “glut in inventories” and a fall in demand as the culprit.

Morgan Stanley’s freight transportation update indicates a collapse in freight demand worse than that seen during 2009.

The Baltic Dry Index, a measure of global freight rates and thus a measure of global demand for shipping of raw materials, has collapsed to even more dismal historic lows. Hucksters in the mainstream continue to push the lie that the fall in the BDI is due to an “overabundance of new ships.” However, the CEO of A.P. Moeller-Maersk, the world’s largest shipping line, put that nonsense to rest when he admitted in November that “global growth is slowing down” and “[t]rade is currently significantly weaker than it normally would be under the growth forecasts we see.”

In addition, another very troubling sign is the fact that initial jobless claims are starting to surge once again

The number of Americans applying for unemployment benefits in mid-January reached seven-month highs, perhaps a sign that the rate of layoffs in the U.S. has risen slightly from record lows.

Initial jobless claims climbed a seasonally adjusted 10,000 to 293,000 in the seven days stretching from Jan. 10 to Jan 16, the government said Thursday. That’s the highest level since last July.

Since the last recession, the primary engine for the creation of good jobs in this country has been the energy industry.

Unfortunately, the “oil boomtowns” are now going bust, and workers are being laid off in droves.  As I mentioned the other day42 North American oil companies have filed for bankruptcy and 130,000 good paying energy jobs have been lost in this country since the start of 2015.  And as long as the price of oil stays in this neighborhood, the worse things are going to get.

A lot of people out there still seem to think that this is just going to be a temporary downturn.  Many are convinced that we will just go through another tough recession and then we will come out okay on the other side.  What they don’t realize is that a number of long-term trends are now reaching a crescendo.

For decades, we have been living wildly beyond our means.  The federal government, state and local governments, corporations and consumers have all been going into debt far faster than our economy has been growing.  Of course this was never going to be sustainable in the long run, but we had been doing it for so long that many of us had come to believe that our exceedingly reckless debt-fueled prosperity was somehow “normal”.

Unfortunately, the truth is that you can’t consume far more than you produce forever.  Eventually reality catches up with you.  This is a point that Simon Black made extremely well in one of his recent articles…

Economics isn’t complicated. The Universal Law of Prosperity is very simple: produce more than you consume.

Governments, corporations, and individuals all have to abide by it. Those who do will thrive. Those who don’t will fail, sooner or later.

When the entire financial system ignores this fundamental rule, it puts us all at risk.

And if you can understand that, you can take simple, sensible steps to prevent the consequences.

Sadly, the time for avoiding the consequences of our actions is now past.

We are now starting to pay the price for decades of incredibly bone-headed decisions, and anyone that is looking to Barack Obama, the Federal Reserve or anyone else in Washington D.C. to be our savior is going to be bitterly disappointed.

And as bad as things have been so far, just wait until you see what happens next.

2016 is the year when everything changes.

The Oil Crash Of 2016 Has The Big Banks Running Scared

Running Scared - Public DomainLast time around it was subprime mortgages, but this time it is oil that is playing a starring role in a global financial crisis.  Since the start of 2015, 42 North American oil companies have filed for bankruptcy, 130,000 good paying energy jobs have been lost in the United States, and at this point 50 percent of all energy junk bonds are “distressed” according to Standard & Poor’s.  As you will see below, some of the big banks have a tremendous amount of loan exposure to the energy industry, and now they are bracing for big losses.  And the longer the price of oil stays this low, the worse the carnage is going to get.

Today, the price of oil has been hovering around 29 dollars a barrel, and over the past 18 months the price of oil has fallen by more than 70 percent.  This is something that has many U.S. consumers very excited.  The average price of a gallon of gasoline nationally is just $1.89 at the moment, and on Monday it was selling for as low as 46 cents a gallon at one station in Michigan.

But this oil crash is nothing to cheer about as far as the big banks are concerned.  During the boom years, those banks gave out billions upon billions of dollars in loans to fund exceedingly expensive drilling projects all over the world.

Now those firms are dropping like flies, and the big banks could potentially be facing absolutely catastrophic losses.  The following examples come from CNN

For instance, Wells Fargo (WFC) is sitting on more than $17 billion in loans to the oil and gas sector. The bank is setting aside $1.2 billion in reserves to cover losses because of the “continued deterioration within the energy sector.”

JPMorgan Chase (JPM) is setting aside an extra $124 million to cover potential losses in its oil and gas loans. It warned that figure could rise to $750 million if oil prices unexpectedly stay at their current $30 level for the next 18 months.

Citigroup is another bank that also has a tremendous amount of exposure

Citigroup (C) built up loan loss reserves in the energy space by $300 million. The bank said the move reflects its view that “oil prices are likely to remain low for a longer period of time.”

If oil stays around $30 a barrel, Citi is bracing for about $600 million of energy credit losses in the first half of 2016. Citi said that figure could double to $1.2 billion if oil dropped to $25 a barrel and stayed there.

For the moment, these big banks are telling the public that the damage can be contained.

But didn’t they tell us the same thing about subprime mortgages in 2008?

We are already seeing bank stocks start to slide precipitously.  People are beginning to realize that these banks are dangerously exposed to a lot of really bad deals.

If the price of oil were to shoot back up above 50 dollars in very short order, the damage would probably be manageable.  Unfortunately, that does not appear likely to happen.  In fact, now that sanctions have been lifted on Iran, the Iranians are planning to flood the world with massive amounts of oil that they have been storing in tankers at sea

Iran has been carefully planning for its return from the economic penalty box by hoarding tons of oil in tankers at sea.

Now that the U.S. and European Union have lifted some sanctions on Iran, the OPEC country can begin selling its massive stockpile of oil.

The sale of this seaborne oil will allow Iran to get an immediate financial boost before it ramps up production. The onslaught of Iranian oil is coming at a terrible time for the global oil markets, which are already drowning in an epic supply glut.

Just the other day, I explained that some of the biggest banks in the world are now projecting that the price of oil could soon fall much, much lower.

Morgan Stanley says that it could go as low as 20 dollars a barrel, the Royal Bank of Scotland says that it could go as low as 16 dollars a barrel, and Standard Chartered says that it could go as low as 10 dollars a barrel.

But the truth is that the price of oil does not need to go down one penny more to have a catastrophic impact on global financial markets.  If it just stays right here, we will see an endless parade of layoffs, energy company bankruptcies  and debt defaults.  Without any change, junk bonds will continue to crash and financial institutions will continue to go down like dominoes.

We are already experiencing a major disaster.  Things are already so bad that some forms of low quality crude oil are literally selling for next to nothing.  The following comes from Bloomberg

Oil is so plentiful and cheap in the U.S. that at least one buyer says it would pay almost nothing to take a certain type of low-quality crude.

Flint Hills Resources LLC, the refining arm of billionaire brothers Charles and David Koch’s industrial empire, said it offered to pay $1.50 a barrel Friday for North Dakota Sour, a high-sulfur grade of crude, according to a corrected list of prices posted on its website Monday. It had previously posted a price of -$0.50. The crude is down from $13.50 a barrel a year ago and $47.60 in January 2014.

While the near-zero price is due to the lack of pipeline capacity for a particular variety of ultra low quality crude, it underscores how dire things are in the U.S. oil patch.

A chart that I saw posted on Zero Hedge earlier today can help put all of this into perspective.  Whenever the price of oil falls really low relative to the price of gold, there is a major global crisis.  Right now an ounce of gold will purchase more oil than ever before, and many believe that this indicates that a new great crisis is upon us…

The number of barrels of oil that a single ounce of gold can buy has never, ever been higher.

Barrels Of Oil Per Ounce Of Gold

All over the planet, big banks are absolutely teeming with bad loans.  And to be honest, the big banks in the U.S. are probably in better shape than some of the major banks in Europe and Asia.  But once the dominoes start to fall, very few financial institutions are going to escape unscathed.

In the coming days I would expect to see more headlines like we just got out of Italy.  Apparently, Italian banks are nearing full meltdown mode, and short selling has been temporarily banned.  To me, it appears that we are just inches away from full-blown financial panic in Europe.

However, just like with the last financial crisis, you never quite know where the next “explosion” is going to happen next.

But one thing is for sure – the financial crisis that began during the second half of 2015 is raging out of control, and the pain that we have seen so far is just the beginning.

The Financial Apocalypse Accelerates As Middle East Stocks Crash To Begin The Week

Apocalyptic - Public DomainIt looks like it is going to be another chaotic week for global financial markets.  On Sunday, news that Iran plans to dramatically ramp up oil production sent stocks plunging all across the Middle East.  Stocks in Kuwait were down 3.1 percent, stocks in Saudi Arabia plummeted 5.4 percent, and stocks in Qatar experienced a mammoth 7 percent decline.  And of course all of this comes in the context of a much larger long-term decline for Middle Eastern stocks.  At this point, Saudi Arabian stocks are down more than 50 percent from their 2014 highs.  Needless to say, a lot of very wealthy people in Saudi Arabia are getting very nervous.  Could you imagine waking up someday and realizing that more than half of your fortune had been wiped out?  Things aren’t that bad in the U.S. quite yet, but it looks like another rough week could be ahead.  The Dow, the S&P 500 and the Nasdaq are all down at least 12 percent from their 52-week highs, and the Russell 2000 is already in bear market territory.  Hopefully this week will not be as bad as last week, but events are starting to move very rapidly now.

Much of the chaos around the globe is being driven by the price of oil.  At the end of last week the price of oil dipped below 30 dollars a barrel, and now Iran has announced plans “to add 1 million barrels to its daily crude production”

Iran could get more than five times as much cash from oil sales by year-end as the lifting of economic sanctions frees the OPEC member to boost crude exports and attract foreign investment needed to rebuild its energy industry.

The Persian Gulf nation will be able to access all of its revenue from crude sales after the U.S. and five other global powers removed sanctions on Saturday in return for Iran’s curbing its nuclear program. The fifth-biggest producer in the Organization of Petroleum Exporting Countries had been receiving only $700 million of each month’s oil earnings under an interim agreement, with the rest blocked in foreign bank accounts. Iran is striving to add 1 million barrels to its daily crude production and exports this year amid a global supply glut that has pushed prices 22 percent lower this month.

It doesn’t take a genius to figure out what this is going to do to the price of oil.

The price of oil has already fallen more than 20 percent so far in 2016, and overall it has declined by more than 70 percent since late 2014.

When the price of oil first started to fall, a lot of people out there were proclaiming that it would be really good for the U.S. economy.  But I said just the opposite.  And of course since that time we have seen an endless parade of debt downgrades, bankruptcies and job losses.  130,000 good paying energy jobs were lost in the United States in 2015 alone because of this collapse, and things just continue to get even worse.  At this point, some are even calling for the federal government to intervene.  For example, the following is an excerpt from a CNN article that was just posted entitled “Is it time to bail out the U.S. oil industry?“…

America’s once-booming oil industry is suddenly in deep financial trouble.

The epic crash in oil prices has wiped out tens of thousands of jobs, caused dozens of bankruptcies and spooked global financial markets.

The fallout is already being felt in oil-rich states like Texas, Oklahoma and North Dakota, where home foreclosure rates are spiking and economic growth is slowing.

Now there are calls in at least some corners for the federal government to come to the rescue.

Is it just me, or is all of this really starting to sound a lot like 2008?

And of course it isn’t just the U.S. that is facing troubles.  The global financial crisis that began during the second half of 2015 is rapidly accelerating, and chaos is erupting all over the planet.  The following summary of what we have been seeing in recent days comes from Doug Noland

The world has changed significantly – perhaps profoundly – over recent weeks. The Shanghai Composite has dropped 17.4% over the past month (Shenzhen down 21%). Hong Kong’s Hang Seng Index was down 8.2% over the past month, with Hang Seng Financials sinking 11.9%. WTI crude is down 26% since December 15th. Over this period, the GSCI Commodities Index sank 12.2%. The Mexican peso has declined almost 7% in a month, the Russian ruble 10% and the South African rand 12%. A Friday headline from the Financial Times: “Emerging market stocks retreat to lowest since 09.”

Trouble at the “Periphery” has definitely taken a troubling turn for the worse. Hope that things were on an uptrend has confronted the reality that things are rapidly getting much worse. This week saw the Shanghai Composite sink 9.0%. Major equities indexes were hit 8.0% in Russia and 5.0% in Brazil (Petrobras down 9%). Financial stocks and levered corporations have been under pressure round the globe. The Russian ruble sank 4.0% this week, increasing y-t-d losses versus the dollar to 7.1%. The Mexican peso declined another 1.8% this week. The Polish zloty slid 2.8% on an S&P downgrade (“Tumbles Most Since 2011”). The South African rand declined 3.0% (down 7.9% y-t-d). The yen added 0.2% this week, increasing 2016 gains to 3.0%. With the yen up almost 4% versus the dollar over the past month, so-called yen “carry trades” are turning increasingly problematic.

Closer to home, the crisis in Puerto Rico continues to spiral out of control.  The following is an excerpt from a letter that Treasury Secretary Jack Lew sent to Congress on Friday

Although there are many ways this crisis could escalate further, it is clear that Puerto Rico is already in the midst of an economic collapse

Puerto Rico is already in default. It is shifting funds from one creditor to pay another and has stopped payment altogether on several of its debts. As predicted, creditors are filing lawsuits. The Government Development Bank, which provides critical banking and fiscal services to the central government, only avoided depleting its liquidity by halting lending activity and sweeping in additional deposits from other Puerto Rico governmental entities. A large debt payment of $400 million is due on May 1, and a broader set of payments are due at the end of June.

It isn’t Michael Snyder from The Economic Collapse Blog that is saying that Puerto Rico is “in the midst of an economic collapse”.

That is the Secretary of the U.S. Treasury that is saying it.

Those that have been eagerly anticipating a financial apocalypse are going to get what they have been waiting for.

Right now we are about halfway through January, and this is the worst start to a year for stocks ever.  The Dow is down a total of 1,437 points since the beginning of 2016, and more than 15 trillion dollars of stock market wealth has been wiped out globally since last June.

Unfortunately, there are still a lot of people out there that are in denial.

There are a lot of people that still believe that this is just a temporary bump in the road and that things will return to “normal” very soon.

They don’t understand that this is just the beginning.  What we have seen so far is just the warm up act, and much, much worse is yet to come.

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