The Economic Collapse

Even though central banks all over the world have been raising interest rates in recent months, food prices just continue to go up.  There are a couple of reasons why this is happening.  First of all, demand for food is very inelastic.  In other words, no matter how high or how low prices go, people are still going to need to eat.  So even if the Federal Reserve sent interest rates into the stratosphere, people would still need to go the supermarket to get food for themselves and their families.  Secondly, we are facing some severe long-term supply problems.  As I have detailed in previous articles, food production is being significantly hindered in a number of different ways, and that isn’t going to change any time soon.  There simply is not enough food to feed everyone on the planet, and supplies are only going to get tighter in the months and years ahead.  No matter what central banks do, this is going to push food prices steadily higher. (Read More...)

What is going to happen to our banking system as trillions of dollars worth of commercial real estate loans go bad?  Many months ago, I warned that the greatest commercial real estate crisis in U.S. history was coming.  At the time, a lot of people didn’t believe me and that was fine.  As with so many other things, all I needed to do to be proven right was to wait.  Sadly, a commercial real estate tsunami is now here, and it appears to be accelerating even faster than many of the experts had been anticipating.  Just within the past few weeks, there have been several more high profile defaults, and San Francisco has become the epicenter of this crisis. (Read More...)

America was once a country that built stuff.  Previous generations of Americans constructed the greatest highways, bridges, railroads, ports, dams and water systems that anyone had ever seen.  Magnificent new mega-cities were erected from coast to coast, and the rest of the world looked at us with envy.  Ultimately, the keys to all of this infrastructure were handed down to us, and we have really messed things up.  We don’t actually build much of anything these days.  In fact, we can’t even maintain the infrastructure that we have been given.  As a society we have become extremely lazy and extremely incompetent, and so the great civilization that our forefathers built for us is now crumbling right in front of our eyes. (Read More...)

A lot of the “experts” have been telling us that economic conditions are likely to really start deteriorating later in the year, but here we are in June and the economy is beginning to unravel a lot quicker than most of them had anticipated.  The housing bubble is imploding, existing home sales are plunging all over the nation, foreclosures are surging, manufacturing numbers have fallen into contraction territory and jobless claims are rising.  We are building up a tremendous amount of momentum in the wrong direction, and just about everyone agrees that the outlook for the remainder of 2023 is not promising.  So if things are this bad now, what will they look like in six months? (Read More...)

Significantly higher food prices are coming, because U.S. food production is going to be way below normal levels this year.  That is really bad news, because food prices are already absurdly high.  In some cases, people are paying as much for a full shopping cart full of food as they did for a used vehicle in the old days.  I wish that I was exaggerating, but I am not.  Unfortunately, food prices are only going to go higher because farmers and ranchers are being hit extremely hard from coast to coast.  For example, it is being reported that wheat farmers in Kansas “will reap their smallest harvest in more than 60 years”… (Read More...)

A lot of people have been waiting for “the other shoe to drop”, and now that day has arrived.  Thanks to rapidly rising interest rates and historically low occupancy rates, we are facing an unprecedented commercial real estate crisis.  Borrowers are starting to walk away from commercial real estate properties all over the nation, and that is really bad news for small and mid-size banks because they are holding most of these loans.  Needless to say, a lot of small and mid-size banks are simply not going to be able to survive a nationwide tsunami of commercial real estate defaults. (Read More...)

There is nothing wrong with being optimistic, but blind optimism can be a very dangerous thing.  The reason why so many of the “experts” were shocked by the Great Recession of 2008 and 2009 is because they didn’t want to believe that such a thing could happen.  Unfortunately, we are witnessing a similar pattern now.  Even though we are absolutely drowning in debt, inflation is wildly out of control, our currency is being transformed into toilet paper, the housing market has started to crash and mass layoffs are being conducted all over the nation, a lot of the “experts” continue to insist that everything is going to be just fine.  For example, the following comes from a CNN article entitled “The case for a 2023 US recession is crumbling”… (Read More...)

Even though most Americans aren’t paying much attention at this point, the way that the war in Ukraine is evolving should greatly concern all of us.  Ukrainian President Volodymyr Zelenskyy and his generals very clearly understand that they are in very big trouble unless they can draw the U.S. and other NATO powers directly into the conflict.  All of Bakhmut is now under Russian control, and the Ukrainians continue to lose troops at a staggering pace.  They are holding a losing hand, but if Ukrainian leaders can find a way to get the Russians to use tactical nukes or other weapons of mass destruction, that would change everything.  Western powers would feel compelled to respond in kind, and then we really would have a truly apocalyptic conflict on our hands. (Read More...)