Economic Recovery

Small Business Ownership In America Is At An All-Time Low

September 8, 2014September 8, 2014 by Michael

According to the Federal Reserve, the percentage of American families that own a small business is at the lowest level that has ever been recorded. In a report that was just released entitled “Changes in U.S. Family Finances from 2010 to 2013: Evidence from the Survey of Consumer Finances“, the Federal Reserve revealed that small business ownership in America “fell substantially” between 2010 and 2013. Even in the midst of this so-called “economic recovery”, small business ownership in America has now fallen to an all-time low. If the economy truly was healthy, this would not be happening. And it isn’t as if Americans are flooding the labor market either. As I detailed yesterday, the labor force participation rate in this country is at a 36 year low. That would not be happening if the economy was actually healthy either. The truth is that the middle class in America is dying, and this new report from the Federal Reserve is more evidence of this very harsh reality.

In order to build wealth, middle class Americans either need to have their own businesses or they need good jobs. Sadly, the percentage of Americans that own a business continues to decline steadily. In the report that I mentioned above, the Federal Reserve says that the proportion of U.S. families that have an ownership interest in a small business fell from 13.3 percent in 2010 to a brand new all-time low of 11.7 percent in 2013.

This is one of the factors that is increasing the gap between the extremely wealthy and the rest of us in this country. And of course another of the major factors is the steady decline in good paying jobs.

The U.S. Competitiveness Project at Harvard Business School is chaired by professors Michael E. Porter and Jan W. Rivkin. It just released a new report entitled “An Economy Doing Half Its Job”, and it addressed the fact that the middle class is deeply struggling even though many large U.S. corporations have been thriving. The following is an excerpt from an article in the Boston Globe about this report…

In a statement, Porter added: “Shortsighted executives may be satisfied with an American economy where firms operating here are winning without lifting US living standards. But leaders with longer perspectives understand that companies can’t thrive for long while their workers and their communities struggle.”

Unfortunately, this is not likely to change any time soon. In fact, that same report discovered that Harvard Business School alumni foresee “falling pay and fewer openings for full-time jobs” for American workers in the years ahead…

U.S. workers face a dim future, with stagnant or falling pay and fewer openings for full-time jobs.

That’s the picture that emerges from a survey of Harvard Business School alumni.

More than 40 percent of the respondents foresee lower pay and benefits for workers. Roughly half favor outsourcing work over hiring staffers. A growing share prefer part-time employees. Nearly half would rather invest in new technology than hire or retain workers.

The Obama administration continues to tell us that the unemployment rate is “going down” and that the economy is recovering, but that does not match the reality of what most Americans are experiencing on a day to day basis.

As David Stockman recently so aptly put it, outside of health and education the U.S. economy has not produced a single job since mid-2000 even though our population has grown greatly since that time…

In a few deft seconds, a “no jobs” nobody who apparently doesn’t actually have one himself, essentially explained the contents of the chart below to his silenced CNBC hosts. Over the course of 170 “jobs Fridays” since mid-2000, the latter have apparently never noticed the single most stunning fact embedded in the monthly BLS report. Namely, that outside of health and education there has not been one net new job created in the American economy since July 2000! Yes, not a single new job—as in none, nein, nichts, nada, zip!

In addition, most of the new jobs that are being “added to the economy” each month are part-time jobs. Right now, we still have 1.4 million fewer full-time jobs than we did in 2008 even though more than 100,000 people are added to the population each month.

What this means is that the middle class is shrinking.

We are witnessing an increasing concentration of wealth among the ultra-wealthy, and most of the rest of us are getting poorer. As a recent CNN article detailed, the Federal Reserve has also discovered that the gap between the rich and the poor in America is larger than the Fed has ever recorded before…

In its Study of Consumer Finances, released every three years, the Fed found that the wealthiest 3% of American households controlled 54.4% of the nation’s wealth in 2013, a slight increase from its last survey in 2010. It’s also substantially higher from the 44.8% they held in 1989, showing how quickly the income divide has been growing over the past decade or so.

At the same time, the share of wealth held by the bottom 90% fell to 24.7% in 2013. That’s compared to 33.2% in 1989.

How close does the share of wealth for the bottom 90 percent have to go before we admit that we have a major problem on our hands?

Is there anyone out there that would be okay with it hitting zero percent?

One of the big reasons why the wealthy have been doing so well is because the stock market has been soaring. The money printing policies of the Federal Reserve have sent stock prices to unprecedented heights. This has overwhelmingly benefited the extremely wealthy…

According to recent data from the Federal Reserve, America has the lowest level of stock ownership in 18 years. Yet stock ownership for the wealthy is at a new high—and that has accounted for most of their good fortune compared to the rest of America.

In fact, the Fed says that the wealthiest top 10 percent of all Americans now own 81 percent of all stocks…

Stock ownership is even more concentrated when it comes to share of total stock holdings. In 2010, the latest period available, the top 10 percent of Americans by net worth held 81 percent of all directly held or indirectly held stocks, according to Edward N. Wolff, an economics professor at New York University who specializes in inequality and Federal Reserve data.

Wolff said that share—which has not been released yet for 2013—has probably gone even higher than 81 percent since 2010.

Since the last financial crisis, the Federal Reserve has been very good to the elite.

But most of the rest of us have had a really hard time.

Until more Americans start getting good jobs and building small businesses, things are not going to turn around for the middle class.

But the policies being pursued by our politicians continue to kill good jobs and continue to kill small businesses, so I wouldn’t expect significant changes any time soon.

21 Ways To End The Phrase ‘Americans Are So Broke…’

July 29, 2014 by Michael

Did you know that 77 million Americans have unpaid debts that are “in collections” and that Congress is actually thinking about letting post offices offer payday loans? We live in a country where almost everyone is drowning in debt and where most people are either flat broke or very close to flat broke. Years ago, “your Mama is so broke” jokes were all the rage, and at the rate we are going they could make a big comeback. Some of my favorites were “your Mama is so broke she went to McDonald’s and put a milkshake on layaway” and “your Mama is so broke your family ate cereal with a fork to save milk”. Unfortunately, the facts that I am about to share with you are not funny at all. In fact, they are quite sobering. Yes, things are going fairly well for the elitists that live in the good areas of New York City, Washington D.C. and San Francisco right now, but most of the country is deeply struggling as our economic fundamentals continue to crumble. Please share these numbers with as many people as you can, because we need people to understand that there has not been an “economic recovery” for most of America. In fact, in many ways things just continue to get even worse. The following are 21 ways to end the phrase “Americans are so broke”…

1. Americans are so broke that about a third of them have debt collectors on their heels. One recent study discovered that more than one out of every three adults in the United States has an unpaid debt that is “in collections“. That is a total of 77 million people. In other words, the debt collection business in America is absolutely booming.

2. Americans are so broke that Congress is now actually considering allowing post offices to provide payday loans and check cashing services.

3. Americans are so broke that they are keeping their vehicles longer than ever. The average age of vehicles on America’s roads recently set a new all-time high of 11.4 years.

4. Americans are so broke that car dealers are having to go to extreme lengths to get new customers. Last year, one out of every four auto loans in the United States was made to someone with subprime credit.

5. Americans are so broke that 52 percent of them cannot even afford the homes that they are living in right now.

6. Americans are so broke that they are falling farther behind on their student loans than ever. The total amount of student loan debt in the U.S. has now reached a whopping 1.2 trillion dollars, and approximately seven million Americans are in default on their student loans at this point.

7. Young Americans are so broke that half of all college graduates are still relying on their parents financially when they are two years out of school.

8. Young Americans are so broke that only 36 percent of American adults under the age of 35 currently own a home. That is the lowest level that has ever been recorded.

9. Americans are so broke that many of them can’t even afford to shop at Wal-Mart and dollar stores anymore…

Discount stores are slowly dying.

Yesterday, Dollar Tree announced it would buy Family Dollar, a chain that is in the process of closing hundreds of stores and firing workers.

Other discount stores have been struggling as well, writes Heidi Moore at The Guardian. Fashion discounter Loehmann’s filed for bankruptcy, while Wal-Mart’s sales have declined for the past five quarters.

“There’s just not enough money deployed by American families to keep all the discount chains in business,” Moore writes.

10. Americans are so broke that they are running up record levels of debt. Overall, U.S. households are 11.68 trillion dollars in debt right now.

11. Americans are so broke that the wealth of the “typical American household” has fallen by 36 percent over the past decade.

12. Americans are so broke that one out of every four part-time workers in America is living below the poverty line.

13. Americans are so broke that more than 37 million Americans are now being served by food pantries and soup kitchens.

14. Americans are so broke that there are 49 million Americans that are dealing with food insecurity.

15. Americans are so broke that the number of people on food stamps has increased by about 14 million while Obama has been in the White House. Ten years ago, the number of women in the U.S. that had jobs outnumbered the number of women in the U.S. on food stamps by more than a 2 to 1 margin. But now the number of women in the U.S. on food stamps actually exceeds the number of women that have jobs.

16. Americans are so broke that the U.S. government has had to spend an astounding 3.7 trillion dollars on welfare programs over the past five years.

17. Americans are so broke that more than 20 percent of all children in the U.S. are living in poverty.

18. Americans are so broke that we have a record number of kids sleeping in the streets. In fact, we have more than a million public school children that are homeless at this point.

19. Americans are so broke that 76 percent of all Americans are living paycheck to paycheck.

20. Americans are so broke that 26 percent of Americans have absolutely no emergency savings whatsoever.

21. Americans are so broke that approximately two-thirds of all Americans do not have enough money saved up to cover six months of expenses if an emergency arose.

If things are this bad now, during the so-called “economic recovery”, how bad will things get during the next major economic downturn?

Unfortunately, most Americans have been lulled into a false sense of security. The financial crisis of 2008 seems like ancient history to most of them now, and most people appear to believe that our leaders have “fixed” whatever was wrong the last time.

Of course that is not the case at all. In fact, our long-term problems have just continued to grow since then.

The truth is that what we are experiencing right now is about as good as things are going to get for the U.S. economy. When the next crisis arrives, all of the numbers in the list above are going to rapidly get a lot worse.

So enjoy the rest of this “bubble” while you still can. It certainly will not last for too much longer.

The “Economic Recovery” Continues: Businesses Are Being Destroyed Faster Than They Are Being Created

May 6, 2014May 6, 2014 by Michael

What would you say about an economy where businesses are shutting down faster than they are opening? Well, a shocking new study released by the Brookings Institution indicates that this is exactly what is happening in the United States. We are absolutely killing small businesses and the entrepreneurial spirit in this country, and as you will see below, the number of self-employed Americans has been on a downward trend for a decade even though our population has been steadily growing. Traditionally, small businesses have been the primary engine of job growth in this nation, so the fact that study after study has found that small business creation is being crippled in the United States is a really bad sign for our economic future.

Personally, I write about our long-term economic decline nearly every day, but even I had no idea that businesses were being destroyed faster than they were being created. According to the Brookings Institution, this first started happening in 2009…

The American economy is less entrepreneurial now than at any point in the last three decades. That’s the conclusion of a new study out from the Brookings Institution, which looks at the rates of new business creation and destruction since 1978.

Not only that, but during the most recent three years of the study — 2009, 2010 and 2011 — businesses were collapsing faster than they were being formed, a first.

And this mirrors an earlier study conducted by economist Tim Kane. According to his analysis of U.S. Department of Labor data, the following is how the decline in the number of new business jobs per one thousand Americans breaks down by presidential administration…

Bush Sr.: 11.3

Clinton: 11.2

Bush Jr.: 10.8

Obama: 7.8

As you can see, this is a problem that has been building for decades and that has accelerated under the Obama administration.

We are strangling small business creation to death, and as a result the number of Americans that are self-employed just keeps going down. Just check out this chart…

And keep in mind that throughout this entire time the U.S. population has been growing. So the numbers in the chart above should be going up steadily as the population grows. But instead they have just kept going down.

Meanwhile, the “economic recovery” is continuing in the corporate world as well.

On Tuesday, we learned that Office Depot is going to be closing 400 stores.

Why would that happen if the economy was actually getting better?

When this was announced, shares of Office Depot rose about 20 percent.

I can never understand why that happens. You would think that when a business makes an announcement that essentially says “our business is failing” that it would cause people to dump the stock.

In any event, this comes on the heels of an announcement by Staples back in March that it was going to shut down 225 stores in the United States and Canada.

So where will we buy our pens and paper from now on?

If the economy really was “recovering”, you would think that demand for office supplies would actually be on the rise.

But the only places where the economy is “recovering” is in places such as Washington D.C., New York City and San Francisco.

Those at the top of the pyramid are doing well, but almost everyone else in the country is really suffering right now.

When you kill off small businesses and the entrepreneurial spirit, it tends to increasingly funnel money to the very top of the food chain. And this is precisely what is happening in America at this point. In a recent article, Charles Hugh Smith included a chart that shows how average household net worth in the U.S. breaks down by quartile…

Bottom 25%: $4,600
From 25% to 50%: $21,700
From 50% to 75%: $78,900
From 75% to 90%: $242,800
Top 10%: $1,606,600

As you can see, the bottom 50 percent are really not that much above zero at all. In the old days, it seemed like almost everyone was “middle class” in America, but now that is rapidly changing.

We can see this increasing divide in the real estate market as well. According to Bloomberg, sales of million dollar homes are booming, but sales of homes at the low end are plunging…

“Million-dollar homes in the U.S. are selling at double their historical average while middle-class property demand stumbles, showing that the housing recovery is mirroring America’s wealth divide.

Purchases costing $1 million or more rose 7.8 percent in March from a year earlier, according to data released last week by the National Association of Realtors. Transactions for $250,000 or less, which represent almost two-thirds of the market, plunged 12 percent in the period”

So this explains why it is almost impossible to find an affordable home in San Francisco, but the overall homeownership rate in the United States has dropped to the lowest level in 19 years.

But even in our wealthy enclaves there are signs of deep economic trouble. For example, in New York City the number of homeless children has soared to a new all-time high…

They’re just like other kids except they have a secret. They are homeless. Children are living hidden lives in plain sight. They are part a growing number of low income families who find themselves with no way out but they are working hard to find a solution.

It’s a big issue. And it’s growing. More than 23,000 children sleep in homeless shelters every night, an all-time high, according to the Coalition for the Homeless.

The only “recovery” being experienced in America is the one that is happening on Wall Street, in boardrooms in Silicon Valley and in the halls of power in Washington.

In the rest of the country, retail stores are closing at the fastest pace that we have seen since the collapse of Lehman Brothers, 20 percent of all families do not have a single member that is employed and 49 million Americans are dealing with food insecurity.

There is no way that we are ever going to have a broad-based economic recovery in this nation if we continue to destroy small businesses. They are the lifeblood of any economy and they are the primary engine of job creation.

Sadly, our politicians seem completely clueless about all of this. So they will continue to do the same things that they have always been doing and then wonder why the economy never seems to turn around.

20 Facts About The Great U.S. Retail Apocalypse That Will Blow Your Mind

March 9, 2014March 9, 2014 by Michael

If the U.S. economy is getting better, then why are major retail chains closing thousands of stores? If we truly are in an “economic recovery”, then why do sales figures continue to go down for large retailers all over the country? Without a doubt, the rise of Internet retailing giants such as Amazon.com have had a huge impact. Today, there are millions of Americans that actually prefer to shop online. Personally, when I published my novel I made it solely available on Amazon. But Internet shopping alone does not account for the great retail apocalypse that we are witnessing. In fact, some retail experts estimate that the Internet has accounted for only about 20 percent of the decline that we are seeing. Most of the rest of it can be accounted for by the slow, steady death of the middle class U.S. consumer. Median household income has declined for five years in a row, but all of our bills just keep going up. That means that the amount of disposable income that average Americans have continues to shrink, and that is really bad news for retailers.

And sadly, this is just the beginning. Retail experts are projecting that the pace of store closings will actually accelerate over the course of the next decade.

So as you read this list below, please take note that things will soon get even worse.

The following are 20 facts about the great U.S. retail apocalypse that will blow your mind…

#1 As you read this article, approximately a billion square feet of retail space is sitting vacant in the United States.

#2 Last week, Radio Shack announced that it was going to close more than a thousand stores.

#3 Last week, Staples announced that it was going to close 225 stores.

#4 Same-store sales at Office Depot have declined for 13 quarters in a row.

#5 J.C. Penney has been dying for years, and it recently announced plans to close 33 more stores.

#6 J.C. Penney lost 586 million dollars during the second quarter of 2013 alone.

#7 Sears has closed about 300 stores since 2010, and CNN is reporting that Sears is “expected to shutter another 500 Sears and Kmart locations soon”.

#8 Overall, sales numbers have declined at Sears for 27 quarters in a row.

#9 Target has announced that it is going to eliminate 475 jobs and not fill 700 positions that are currently empty.

#10 It is being projected that Aéropostale will close about 175 stores over the next couple of years.

#11 Macy’s has announced that it is going to be closing five stores and eliminating 2,500 jobs.

#12 The Children’s Place has announced that it will be closing down 125 of its “weakest” stores by 2016.

#13 Best Buy recently shut down about 50 stores up in Canada.

#14 Video rental giant Blockbuster has completely shut down all of their stores.

#15 It is being projected that sales at U.S. supermarkets will decline by 1.7 percent this year even as the overall population continues to grow.

#16 McDonald’s has reported that sales at established U.S. locations were down 3.3 percent in January.

#17 A home appliance chain known as “American TV” in the Midwest is going to be shutting down all 11 stores.

#18 Even Wal-Mart is struggling right now. Just check out what one very prominent Wal-Mart executive recently admitted…

David Cheesewright, CEO of Walmart International was speaking at the same presentation, and he pointed out that Walmart would try to protect its market share in the US – where the company had just issued an earnings warning. But most of the growth would have to come from its units outside the US. I mean, via these share buybacks?

Alas, outside the US too, economies were limping along at best, and consumers were struggling and the operating environment was tough. “We’re seeing economies under stress pretty much everywhere we operate,” Cheesewright admitted.

#19 In a recent CNBC article entitled “Time to close Wal-Mart stores? Analysts think so“, it was recommended that Wal-Mart should close approximately 100 “underperforming” supercenters in rural locations across America.

#20 Retail consultant Howard Davidowitz is projecting that up to half of all shopping malls in America may shut down within the next 15 to 20 years…

Within 15 to 20 years, retail consultant Howard Davidowitz expects as many as half of America’s shopping malls to fail. He predicts that only upscale shopping centers with anchors like Saks Fifth Avenue and Neiman Marcus will survive.

So is there any hope that things will turn around?

Well, if the U.S. economy started producing large numbers of good paying middle class jobs there would definitely be cause for optimism.

Unfortunately, that is just not happening.

On Friday, we were told that the U.S. economy added 175,000 jobs during the month of February.

That sounds pretty good until you realize that it takes almost that many jobs each month just to keep up with population growth.

And according to CNS News, the number of unemployed Americans actually grew faster than the number of employed Americans in February…

The number of unemployed individuals 16 years and over increased by 223,000 in February, according to the Bureau of Labor Statistics (BLS).

In February, there were 10,459,000 unemployed individuals age 16 and over, which was up 223,000 from January, when there were 10,236,000 unemployed individuals.

Meanwhile, the labor force participation rate continues to sit at a 35 year low, and a staggering 70 percent of all Americans not in the labor force are below the age of 55.

That is outrageous.

And things look particularly depressing when you look at the labor force participation rate for men by themselves.

In 1950, the labor force participation rate for men was sitting at about 87 percent. Today, it has dropped beneath 70 percent to a brand new all-time record low.

The truth is that there simply are not enough jobs for everyone anymore.

The chart posted below shows how the percentage of working age Americans that actually have a job has changed since the turn of the millennium. As you can see, the employment-population ratio declined precipitously during the last recession, and it has stayed below 59 percent since late 2009…

If we were going to have a “recovery”, we should have had one by now.

Since there are not enough jobs, what is happening is that more highly educated workers are taking the jobs that were once occupied by less educated workers and bumping them out of the labor force entirely. The following is an excerpt from a recent Bloomberg article…

Recent college graduates are ending up in more low-wage and part-time positions as it’s become harder to find education-level appropriate jobs, according to a January study by the Federal Reserve Bank of New York.

The share of Americans ages 22 to 27 with at least a bachelor’s degree in jobs that don’t require that level of education was 44 percent in 2012, up from 34 percent in 2001, the study found.

Due to the fact that there are not enough middle class jobs to go around, the middle class has been steadily shrinking.

In 2008, 53 percent of all Americans considered themselves to be “middle class”. Today, only 44 percent of all Americans consider themselves to be “middle class”.

That is a pretty significant shift in just six years, don’t you think?

For much more on this, please see my previous article entitled “28 Signs That The Middle Class Is Heading Toward Extinction“.

Despite what the politicians and the mainstream media are telling you, the truth is that something is fundamentally wrong with our economy.

On a gut level, most people realize this.

According to one recent survey, only 35 percent of all Americans say that they are better off financially than they were a year ago. And according to a recent NBC News/Wall Street Journal poll, only 28 percent of all Americans believe that this country is moving in the right direction.

The frightening thing is that this is about as good as things are going to get. The next great wave of the economic collapse is approaching, and when it strikes the plight of the middle class is going to get a whole lot worse.

No Janet Yellen, The Economy Is NOT “Getting Better”

February 11, 2014 by Michael

On Tuesday, new Federal Reserve Chairman Janet Yellen went before Congress and confidently declared that “the economic recovery gained greater traction in the second half of last year” and that “substantial progress has been made in restoring the economy to health”. This resulted in glowing headlines throughout the mainstream media such as this one from USA Today: “Yellen: Economy is improving at moderate pace“. Sadly, tens of millions of Americans are going to believe what the mainstream media is telling them. But it isn’t the truth. As you will see below, there are all sorts of signs that the economy is taking a turn for the worse. And when the next great economic crisis does strike, most Americans will be completely and totally unprepared because they trusted our “leaders” when they told us that everything would be just fine.

It is amazing how deceived people can be. Just consider the case of 56-year-old Brian Perry. He is a former law clerk that has applied for nearly 1,500 jobs since 2008 without any success. But he says that he is “optimistic” that he will get another job soon because he believes that the economy is recovering…

By his own count, Brian Perry has applied for nearly 1,500 jobs since being let go as a law clerk in 2008. The 56-year old Perry lives in Rhode Island, where the 9.1 percent unemployment rate is 2.5 percentage points above the national average.

Perry remains optimistic that a job is forthcoming. He thinks a more robust economy would create better opportunities for the long-term unemployed like him.

Let us certainly hope that Perry does find a new job soon. But if he does, it won’t be because we are experiencing an “economic recovery”. Just consider the following facts…

-In January, we were told that the U.S. economy “created” 113,000 new jobs. But that figure was arrived at only after adding a massive seasonal adjustment. In reality, the U.S. economy actually lost 2.87 million jobs in January. During the past decade, the only time the U.S. economy has lost more jobs in January was during 2009. At that time, the U.S. economy was suffering through the peak of the worst economic downturn since the Great Depression.

-Prominent retailers are closing hundreds of stores all over the United States. Things have gotten so bad that some are calling this a “retail apocalypse“…

JC Penney, which lost $586 million in three months in 2013, is planning to close 33 stores in 19 states and lay off 2,000 people. JC Penney’s stock has lost 84 percent of its value since February 2012.
Sears has decided to shut down its flagship store in Downtown Chicago, and it has closed 300 stores in the United States since 2010. Stock analyst Brian Sozzi noted that Sear’s inventory levels have fallen by 23.7 percent since 2006. He also noted that Sears had $4.4 billion in cash and equivalents in 2005 but $609 million in cash and equivalents in 2012. Sozzi, who calls himself a guerrilla analyst, has a blog full of disturbing pictures of empty Sears stores.
Macy’s, one of the few retail success stories, is planning to close five stores and eliminate 2,500 jobs.
Radio Shack is preparing to close 500 stores, according to The Wall Street Journal.
Best Buy recently closed 50 stores and eliminated 950 jobs at stores in Canada.
Target announced plans to eliminate 475 jobs and not fill 700 empty positions to reduce costs.
Aeropostale is planning to close 175 stores.
Blockbuster has closed down all of its stores.

-McDonald’s is reporting that sales at established U.S. locations were down 3.3 percent in January.

-In January, real disposable income in the U.S. experienced the largest year over year decline that we have seen since 1974.

-As I wrote about the other day, the number of “planned job cuts” in January was 12 percent higher than 12 months earlier, and it was actually 47 percent higher than in December.

-Only 35 percent of all Americans say that they are better off financially than they were a year ago.

-What is happening to the U.S. stock market right now very closely resembles what happened to the U.S. stock market just before the horrific stock market crash of 1929. Just check out the chart in this article.

For dozens more statistics that show that the U.S. economy is not improving, please see this article and this article.

Meanwhile, things continue to unravel all around the rest of the globe as well.

In previous articles, I have detailed how the reckless money printing by the Federal Reserve has inflated massive financial bubbles in emerging markets all over the planet. Now that the Fed is “tapering”, those bubbles are starting to burst and we are witnessing a tremendous amount of economic chaos. Here are three more examples…

#1 Ghana:

Ghanaian Economist Dr. Theo Richardson says Ghana’s economy will crash by June this year if the Bank of Ghana continues with its kneejerk measures to rescue the cedi.

“The government is facing liquidity problems and if we don’t get the appropriate remedies to address the issues at hand the situation may worsen and by June the economy may crash,” Dr. Richardson said.

#2 Kazakhstan:

With only $24.5 billion left in FX reserves after valiantly defending major capital outflows since the Fed’s Taper announcement, the Kazakhstan central bank has devalued the currency (Tenge) by 19% – its largest adjustment since 2009. At 185 KZT to the USD, this is the weakest the currency has ever been as the central bank cites weakness in the Russian Ruble and “speculation” against its currency as drivers of the outflows (which will be “exhausted” by this devaluation according to the bank). The new level will improve the country’s competitiveness (they are potassium heavy) but one wonders whether, unless Yellen folds whether it will help the outflows at all.

#3 India:

In the wake of a global stock market sell-off driven by worries over slower growth in emerging markets, the head of India’s central bank, Raghuram Rajan, criticized the U.S. Federal Reserve as it pressed on with plans to dial back its monthly bond purchases: “International monetary co-operation has broken down,” said Rajan, who added that “the U.S. should worry about the effects of its polices on the rest of the world.”

We have reached a “turning point” for the global financial system. Things are beginning to fall apart both in the United States and all around the world.

But at least the dogs at the White House are eating well. Just consider the following photo that was recently tweeted by Michelle Obama…

37 Reasons Why “The Economic Recovery” Is A Giant Lie

January 9, 2014December 8, 2013 by Michael

“If you repeat a lie often enough, people will believe it.” Sadly, that appears to be the approach that the Obama administration and the mainstream media are taking with the U.S. economy. They seem to believe that if they just keep telling the American people over and over that things are getting better, eventually the American people will believe that it is actually true. On Friday, it was announced that the unemployment rate had fallen to “7 percent”, and the mainstream media responded with a mix of euphoria and jubilation. For example, one USA Today article declared that “with today’s jobs report, one really can say that our long national post-financial crisis nightmare is over.” But is that actually the truth? As you will see below, if you assume that the labor force participation rate in the U.S. is at the long-term average, the unemployment rate in the United States would actually be 11.5 percent instead of 7 percent. There has been absolutely no employment recovery. The percentage of Americans that are actually working has stayed between 58 and 59 percent for 51 months in a row. But most Americans don’t understand these things and they just take whatever the mainstream media tells them as the truth.

And of course the reality of the matter is that we should have seen some sort of an economic recovery by now. Those running our system have literally been mortgaging the future in a desperate attempt to try to pump up our economic numbers. The federal government has been on the greatest debt binge in U.S. history and the Federal Reserve has been printing money like crazed lunatics. All of that “stimulus” should have had some positive short-term effects on the economy.

Sadly, all of those “emergency measures” do not appear to have done much at all. The percentage of Americans that have a job has stayed remarkably flat since the end of 2009, median household income has fallen for five years in a row, and the rate of homeownership in the United States has fallen for eight years in a row. Anyone that claims that the U.S. economy is experiencing a “recovery” is simply not telling the truth. The following are 37 reasons why “the economic recovery” is a giant lie…

#1 The only reason that the official unemployment rate has been declining over the past couple of years is that the federal government has been pretending that millions upon millions of unemployed Americans no longer want a job and have “left the labor force”. As Zero Hedge recently demonstrated, if the labor force participation rate returned to the long-term average of 65.8 percent, the official unemployment rate in the United States would actually be 11.5 percent instead of 7 percent.

#2 The percentage of Americans that are actually working is much lower than it used to be. In November 2000, 64.3 percent of all working age Americans had a job. When Barack Obama first entered the White House, 60.6 percent of all working age Americans had a job. Today, only 58.6 percent of all working age Americans have a job. In fact, as you can see from the chart posted below, there has been absolutely no “employment recovery” since the depths of the last recession…

#3 The employment-population ratio has now been under 59 percent for 51 months in a row.

#4 There are 1,148,000 fewer Americans working today than there was in November 2006. Meanwhile, our population has grown by more than 16 million people during that time frame.

#5 The “inactivity rate” for men in their prime working years (25 to 54) has just hit a brand new all-time record high. Does this look like an “economic recovery” to you?…

#6 The number of working age Americans without a job has increased by a total of 27 million since the year 2000.

#7 In November 2007, there were 121.9 million full-time workers in the United States. Today, there are only 116.9 million full-time workers in the United States.

#8 Middle-wage jobs accounted for 60 percent of the jobs lost during the last recession, but they have accounted for only 22 percent of the jobs created since then.

#9 Only about 47 percent of all adults in America have a full-time job at this point.

#10 The ratio of wages to corporate profits in the United States just hit a brand new all-time low.

#11 It is hard to believe, but in America today one out of every ten jobs is now filled by a temp agency.

#12 Approximately one out of every four part-time workers in America is living below the poverty line.

#13 In this economic environment, there is intense competition even for the lowest paying jobs. Wal-Mart recently opened up two new stores in Washington D.C., and more than 23,000 people applied for just 600 positions. That means that only about 2.6 percent of the applicants were ultimately hired. In comparison, Harvard offers admission to 6.1 percent of their applicants.

#14 According to the Social Security Administration, 40 percent of all U.S. workers make less than $20,000 a year.

#15 When Barack Obama took office, the average duration of unemployment in this country was 19.8 weeks. Today, it is 37.2 weeks.

#16 According to the New York Times, long-term unemployment in America is up by 213 percent since 2007.

#17 Thanks to Obama administration policies which are systematically killing off small businesses in the United States, the percentage of self-employed Americans is at an all-time low today.

#18 According to economist Tim Kane, the following is how the number of startup jobs per 1000 Americans breaks down by presidential administration…

Bush Sr.: 11.3

Clinton: 11.2

Bush Jr.: 10.8

Obama: 7.8

#19 According to the U.S. Census Bureau, median household income in the United States has fallen for five years in a row.

#20 The rate of homeownership in the United States has fallen for eight years in a row.

#21 Back in 1999, 64.1 percent of all Americans were covered by employment-based health insurance. Today, only 54.9 percent of all Americans are covered by employment-based health insurance, and thanks to Obamacare millions more Americans are now losing their health insurance plans.

#22 As 2003 began, the average price of a gallon of regular gasoline was about $1.30. When Barack Obama took office, the average price of a gallon of regular gasoline was $1.85. Today, it is $3.26.

#23 Total consumer credit has risen by a whopping 22 percent over the past three years.

#24 In 2008, the total amount of student loan debt in this country was sitting at about 440 billion dollars. Today, it has shot up to approximately a trillion dollars.

#25 Under Barack Obama, the velocity of money (a very important indicator of economic health) has plunged to a post-World War II low.

#26 Back in the year 2000, our trade deficit with China was 83 billion dollars. In 2008, our trade deficit with China was 268 billion dollars. Last year, it was 315 billion dollars. That was the largest trade deficit that one nation has had with another nation in world history.

#27 The gap between the rich and the poor in the United States is at an all-time record high.

#28 Right now, 1.2 million students that attend public schools in the United States are homeless. That is a brand new all-time record high, and that number has risen by 72 percent since the start of the last recession.

#29 When Barack Obama first entered the White House, there were about 32 million Americans on food stamps. Today, there are more than 47 million Americans on food stamps.

#30 Right now, approximately one out of every five households in the United States is on food stamps.

#31 According to the Survey of Income and Program Participation conducted by the U.S. Census, well over 100 million Americans are enrolled in at least one welfare program run by the federal government.

#32 In 2000, the U.S. government spent 199 billion dollars on Medicaid. In 2008, the U.S. government spent 338 billion dollars on Medicaid. In 2012, the U.S. government spent 417 billion dollars on Medicaid, and now Obamacare is going to add tens of millions more Americans to the Medicaid rolls.

#33 In 2000, the U.S. government spent 219 billion dollars on Medicare. In 2008, the U.S. government spent 462 billion dollars on Medicare. In 2012, the U.S. government spent 560 billion dollars on Medicare, and that number is expected to absolutely skyrocket in the years ahead as the Baby Boomers retire.

#34 According to the most recent numbers from the U.S. Census Bureau, an all-time record high 49.2 percent of all Americans are receiving benefits from at least one government program.

#35 The U.S. government has spent an astounding 3.7 trillion dollars on welfare programs over the past five years.

#36 When Barack Obama was first elected, the U.S. debt to GDP ratio was under 70 percent. Today, it is up to 101 percent.

#37 The U.S. national debt is on pace to more than double during the eight years of the Obama administration. In other words, under Barack Obama the U.S. government will accumulate more debt than it did under all of the other presidents in U.S. history combined.

Fortunately, it appears that most Americans are not buying into the propaganda. According to a new CNN survey, the percentage of Americans that believe that the economy is getting worse far exceeds the percentage of Americans that believe that the economy is improving…

Americans views on the state of the nation are turning increasingly sour, according to a new national poll.

And a CNN/ORC International survey released Friday also indicates that less than a quarter of the public says that economic conditions are improving, while nearly four in ten say the nation’s economy is getting worse.

Forty-one percent of those questioned in the poll say things are going well in the country today, down nine percentage points from April, and the lowest that number has been in CNN polling since February 2012. Fifty-nine percent say things are going badly, up nine points from April.

So what do you think?

Do you believe that the U.S. economy is getting better or getting worse? Please feel free to share what you think by posting a comment below…

Meet One Of The Victims Of Obama’s “Economic Recovery”

November 11, 2013 by Michael

Have you ever cried yourself to sleep because you had no idea how you were going to pay the bills even though you were working as hard as you possibly could? You are about to hear from a single mother that has been there. Her name is Yolanda Vestal and she is another victim of Obama’s “economic recovery”. Yes, things have never been better for the top 0.01 percent of ultra-wealthy Americans that have got millions of dollars invested in the stock market. But for most of the rest of the country, things are very hard right now. At this point, more than 102 million working age Americans do not have a job, and 40 percent of those that are actually working earn less than $20,000 a year in wages. If we actually are experiencing an “economic recovery”, then why is the federal government spending nearly a trillion dollars a year on welfare? And that does not even include entitlement programs such as Social Security and Medicare. We live in a nation where poverty is exploding and the middle class is shrinking with each passing day. But nothing is ever going to get fixed if we all stick our heads in the sand and pretend that everything is “just fine”.

What you are about to read is an open letter to Barack Obama that has gone absolutely viral on the Internet in recent days. It is a letter that a single mother named Yolanda Vestal posted on her Facebook page, and it has really struck a nerve because countless other young parents can clearly identify with what she is going through. The following is the text of her letter…

Dear President Obama,

I wanted to take a moment to say thank you for all you have done and are doing. You see I am a single Mom located in the very small town of Palmer, Texas. I live in a small rental house with my two children. I drive an older car that I pray daily runs just a little longer. I work at a mediocre job bringing home a much lower paycheck than you or your wife could even imagine living on. I have a lot of concerns about the new “Obamacare” along with the taxes being forced on us Americans and debts you are adding to our country. I have a few questions for you Mr. President.

Have you ever struggled to pay your bills? I have.

Have you ever sat and watched your children eat and you eat what was left on their plates when they were done, because there wasn’t enough for you to eat to? I have.

Have you ever had to rob Peter to pay Paul, and it still not be enough? I have.

Have you ever been so sick that you needed to see a doctor and get medicine, but had no health insurance because it was too expensive? I have.

Have you ever had to tell your children no, when they asked for something they needed? I have.

Have you ever patched holes in pants, glued shoes, replaced zippers, because it was cheaper than buying new? I have.

Have you ever had to put an item or two back at the grocery store, because you didn’t have enough money? I have.

Have you ever cried yourself to sleep, because you had no clue how you were going to make ends meet? I have.

My questions could go on and on. I don’t believe you have a clue what Americans are actually going through and honestly, I don’t believe you care. Not everyone lives extravagantly. While your family takes expensive trips that cost more than most of us make in two-four years, there are so many of us that suffer. Yet, you are doing all you can to add to the suffering. I think you are a very selfish and cold hearted man, who does not care what is best for the people he was elected by (not by me) to represent, but more so out for the glory of your name attached to history. So thank you Mr. President, thank you for pushing those of us that are barely staying afloat completely under water and driving America into the ground. You have made your mark in history, as the absolute worst and most hated president of the United States. God have mercy on your soul!

Sincerely,

Yolanda Vestal

Average American

These are the kinds of emotions that millions of American parents are wrestling with on a daily basis. Many of them are working as hard as they possibly can and yet still find themselves unable to adequately provide for their families.

And now that food stamps are being cut back, more of them than ever are going to be forced to turn to food banks for help. The following is what the head of a large food bank in Casper, Wyoming told one local newspaper about the increase in demand that he is witnessing in his area…

Across the state, food banks and other related programs aiming to feed the needy are worried the supply to meet the uptick in need during the holiday season won’t meet the growing demand for food caused by the expiration of SNAP benefits.

“People are scared to death of the lack of food availability,” Martin said.

Martin called Joshua’s Storehouse a reliable barometer for measuring the rate of need in Casper. The number of people using the food bank skyrocketed before the reduction in SNAP, he said.

Fewer than 2,000 people used the food bank in October 2012. Last month 2,500 people went there for help.

And of course this is not just happening in rural areas either. Margarette Purvis, the head of the largest food bank organization in New York City, says that she is anticipating a huge surge in demand and that veterans are being hit particularly hard…

“On this Veterans Day, when we’re waving our flags — I need every New Yorker to know — 40 percent of New York City veterans are relying on soup kitchens and pantries.”

Purvis says that there are 95,000 vets relying on food banks in New York City alone.

That is a lot of people.

And while Barack Obama may trot out a few vets on national holidays and promise that “we will never forget” them, the truth is that most of the time the federal government treats our military veterans like human garbage. If you doubt this, please see my previous article entitled “25 Signs That Military Veterans Are Being Treated Like Absolute Trash Under The Obama Administration“.

Meanwhile, anger and frustration with the economy are starting to rise to very dangerous levels in this nation.

In a previous article, I noted that violent crime in America rose by 15 percent last year. One of the primary reasons for this is the economic despair that we see in our streets.

As the economy gets even worse, people will become even more desperate. We will start to see even more flash mob crimes like we saw in Chicago recently. Posted below is a video news report that shows footage of a flash mob in Chicago dragging entire racks of merchandise out of a Sports Authority store…

When you watch stuff like this, it helps to explain why demand for armored vehicles among the ultra-wealthy in America is skyrocketing.

Unfortunately, most Americans cannot afford armored vehicles and walled vacation homes in the middle of nowhere.

Most Americans are going to have to live right in the middle of all of this as it happens.

A volcano of anger, frustration and despair is simmering just below the surface in America.

When that volcano finally erupts, it is going to be a very frightening thing to behold.

29 Incredible Facts Which Prove That Poverty In America Is Absolutely Exploding

October 27, 2013October 27, 2013 by Michael

Did you know that the number of Americans on welfare is higher than the number of Americans that have full-time jobs? Did you know that 1.2 million public school students in the U.S. are currently homeless? Anyone that uses the term “economic recovery” to describe what is happening in the United States today is being deeply insulting to the nearly 150 million Americans that are considered to be either “poor” or “low income” at this point. Yes, things are great in New York City, Washington D.C. and San Francisco, but almost everywhere else economic conditions continue to steadily get worse. The gap between the wealthy and the poor is at a level that America has never seen before, and this is beginning to create a “Robin Hood mentality” that could cause a tremendous amount of social chaos in the years ahead. Anger at the “haves” in America continues to rise at a very alarming pace, and the “have nots” are becoming increasingly desperate. At some point all of this anger is going to boil over, and you won’t want to be anywhere around major population centers when that happens. Despite unprecedented borrowing by the federal government in recent years, and despite unprecedented money printing by the Federal Reserve, poverty in the United States keeps getting worse with each passing year. The following are 29 incredible facts which prove that poverty in America is absolutely exploding…

1. What can you say about a nation that has more people getting handouts from the federal government than working full-time? According to the latest numbers from the U.S. Census Bureau, the number of people receiving means-tested welfare benefits is greater than the number of full-time workers in the United States.

2. New numbers have just been released, and they show that the number of public school students in this country that are homeless is at an all-time record high. It is hard to believe, but right now 1.2 million students that attend public schools in America are homeless. That number has risen by 72 percent since the start of the last recession.

3. When I was growing up, it seemed like almost everyone was from a middle class home. But now that has all changed. One recent study discovered that nearly half of all public students in the United States come from low income homes.

4. How can anyone deny that we are a socialist nation when half the people are getting money from the federal government each month? According to the most recent numbers from the U.S. Census Bureau, 49.2 percent of all Americans are receiving benefits from at least one government program.

5. Signs of increasing poverty are even showing up in the wealthiest areas of the nation. According to the New York Post, New York subways are being “overrun with homeless“.

6. According to the U.S. Census Bureau, approximately one out of every six Americans is now living in poverty. The number of Americans living in poverty is now at a level not seen since the 1960s.

7. The gap between the rich and the poor in the United States is at an all-time record high. The wealthy may not consider this to be much of a problem, but those at the other end of the spectrum are very aware of this.

8. The “working poor” is one of the fastest growing segments of the U.S. population. At this point, approximately one out of every four part-time workers in America is living below the poverty line.

9. According to numbers provided by Wal-Mart, more than half of their hourly workers make less than $25,000 a year.

10. A recent Businessweek article mentioned a study that discovered that 300 employees at one Wal-Mart in Wisconsin receive a combined total of nearly a million dollars a year in public assistance…

“A decent wage is their demand—a livable wage, of all things,” said Representative George Miller (D-Calif.). The problem with companies like Wal-Mart is their “unwillingness, not their inability, to pay that wage,” he said. “They hand off the difference to taxpayers.” Miller was referring to a congressional report (PDF) released in May that calculated how much Walmart workers rely on public assistance. The study found that the 300 employees at one Supercenter in Wisconsin required some $900,000 worth of public assistance a year.

11. The stock market may be doing great (for the moment), but incomes for average Americans continue to decline. In fact, median household income in the United States has fallen for five years in a row.

12. The quality of the jobs in America has been steadily dropping for years. At this point, one out of every four American workers has a job that pays $10 an hour or less.

13. According to a Gallup poll that was recently released, 20.0% of all Americans did not have enough money to buy food that they or their families needed at some point over the past year. That is just under the record of 20.4% that was set back in November 2008.

14. Young adults are particularly feeling the sting of poverty these days. American families that have a head of household that is under the age of 30 have a poverty rate of 37 percent.

15. As I wrote about a few weeks ago, one out of every five households in the United States is on food stamps. Back in the 1970s, about one out of every 50 Americans was on food stamps.

16. The number of Americans on food stamps now exceeds the entire population of Spain.

17. According to one calculation, the number of Americans on food stamps now exceeds the combined populations of “Alaska, Arkansas, Connecticut, Delaware, District of Columbia, Hawaii, Idaho, Iowa, Kansas, Maine, Mississippi, Montana, Nebraska, Nevada, New Hampshire, New Mexico, North Dakota, Oklahoma, Oregon, Rhode Island, South Dakota, Utah, Vermont, West Virginia, and Wyoming.”

18. We are told that we live in the “wealthiest nation” on the planet, and yet more than one out of every four children in the United States is enrolled in the food stamp program.

19. The average food stamp benefit breaks down to approximately $4 per person per day.

20. It is being projected that approximately 50 percent of all U.S. children will be on food stamps before they reach the age of 18.

21. Today, approximately 17 million children in the United States are facing food insecurity. In other words, that means that “one in four children in the country is living without consistent access to enough nutritious food to live a healthy life.”

22. It may be hard to believe, but approximately 57 percent of all children in the United States are currently living in homes that are considered to be either “low income” or impoverished.

23. The number of children living on $2.00 a day or less in the United States has grown to 2.8 million. That number has increased by 130 percent since 1996.

24. In Miami, 45 percent of all children are living in poverty.

25. In Cleveland, more than 50 percent of all children are living in poverty.

26. According to a recently released report, 60 percent of all children in the city of Detroit are living in poverty.

27. According to a Feeding America hunger study, more than 37 million Americans are now being served by food pantries and soup kitchens.

28. The U.S. government has spent an astounding 3.7 trillion dollars on welfare programs over the past five years.

29. It has been reported that 4 out of every 5 adults in the United States “struggle with joblessness, near-poverty or reliance on welfare for at least parts of their lives”.

These poverty numbers keep getting worse year after year no matter what our politicians do.

So is there anyone out there that would still like to argue that we are in an “economic recovery”?

And as I mentioned above, the “have nots” are becoming increasingly angry at the “haves”. For example, just check out the following excerpt from a recent New York Post article…

The maniac who butchered a Brooklyn mom and her four young kids confessed that he did it because he was jealous of their way of life, a police source told The Post on Sunday.

“The family had too much. Their income (and) lifestyle was better than his,” the source said.

The bloody suspect was caught holding the kitchen knife he used during the Saturday night rampage inside the Sunset Park apartment where he had been staying with the victims, the source added.

Sadly, this was not an isolated incident. All over the western world, a “Robin Hood mentality” is growing. This is something that I am so concerned about that I made it a big part of my new book. At this point, even wealthy Hollywood-types such as actor Russell Brand are calling for a socialist-style “revolution” and a “massive redistribution of wealth“.

Perhaps Brand does not understand that what he is calling for would mean redistributing most of his own wealth away from him.

When the next major wave of the economic collapse strikes, I fear that all of this anger and frustration that are growing among the poor will boil over in some very frightening ways. I believe that we will see a huge spike in crime and that we will eventually see communities all over America looted and burning.

But I am not the only one that is thinking along these lines. A new National Geographic Channel movie entitled “American Blackout” attempts to portray the social chaos that could erupt in the event of an extended national power failure…

American Blackout, National Geographic Channel’s two-hour, edge-of-your-seat movie event imagines the story of a national power failure in the United States caused by a cyberattack — told in real time, over 10 days, by those who kept filming on cameras and phones. You’ll learn what it means to be absolutely powerless.

You can view a clip of the film that was made available by NatGeo for the SHTFplan.com community right here.

What would you do if something like that happened to you?

How would you handle desperate, hungry people at your fence asking for food?

And what if those people were armed and were not “asking nicely” for your food?

Don’t ignore what is happening in America right now. It is setting the stage for some very chaotic times.

Get ready while you still can.

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