Food Stamps

One Piece Of Moderately Good Economic News And 14 Pieces Of Bad Economic News That Are So Horrifying You Might Not Want To Read Them Standing Up

Today the financial world was buzzing with excitement because there was one moderately good piece of news for the U.S. economy.  U.S. employers added 151,000 jobs during the month of October and the unemployment rate remained unchanged at 9.6%.  This is certainly welcome news, but these days it seems as though there are at least ten pieces of bad economic news for every hopeful economic signal.  So don’t get fooled when the U.S. economy takes one step forward, because it is about to take another dozen or so steps backwards.  We are living in the middle of a nightmarish long-term economic decline that has been building for generations.  The deindustrialization of the United States, the horrific trade deficit caused by globalization and the skyrocketing national debt are problems that have taken decades to develop.  The Federal Reserve has been ripping the guts out of our financial system since 1913.  These are not things that are going to be fixed overnight.  In fact, there are some statistics that just keep getting worse and worse and worse as time goes by.  We are heading straight for a devastating economic collapse and hopefully we can all warn as many people as possible while there is still time.

The more research that you do into our economic situation the more depressing it becomes.  We are in big, big, big trouble.  The following are 14 pieces of bad economic news that are so horrifying you might not want to read them standing up….

#1 More than 42 million Americans were on food stamps during the month of August.  That is a new all-time record, and that number is 17 percent higher than it was one year earlier.  In fact, the number of Americans on food stamps is up more than 58 percent since August 2007.

#2 The number of “persons not in the labor force” in the United States has set another new all-time record.  The United States has not had such an extended bout of mass unemployment since the Great Depression.  The “official” unemployment rate in the United States has been at nine and a half percent or above for 14 consecutive months.

#3 More than 1000 people now live in the 200 miles of flood tunnels that exist under the city of Las Vegas.  Once one of the most prosperous cities in the United States, Las Vegas is now little more than a shiny, glittering corpse that it rapidly decaying.

#4 Poverty is absolutely exploding and it is hitting those who are the most vulnerable the hardest.  According to one recent study, approximately 21 percent of all children in the United States are living below the poverty line in 2010.

#5 In the past 60 days alone, the price of cotton is up 54%, the price of corn is up 29%, the price of soybeans is up 22%, the price of orange juice is up 17%, and the price of sugar is up 51%.

#6 One out of every six Americans is now enrolled in at least one anti-poverty program run by the federal government.

#7 The American Bankruptcy Institute says that there will be about 1.6 million consumer bankruptcies in 2010.  That would represent a huge increase over 2009.

#8 According to one recent survey, 28% of all U.S. households have at least one member that is looking for a full-time job.

#9 The individual U.S. states are mostly flat broke.  For example, it is being reported that the 15 largest U.S. states spent on average over 220% of their tax receipts over the past decade.  Clearly this is not even close to sustainable.

#10 The U.S. government is completely and totally broke.  After analyzing Congressional Budget Office data, Boston University economics professor Laurence J. Kotlikoff concluded that the U.S. government is facing a “fiscal gap” of $202 trillion dollars.

#11 In an attempt to keep our financial system solvent, the U.S. Federal Reserve has announced plans to create $600 billion out of thin air and pump it into the U.S. economy.  The Fed is calling this “quantitative easing“, but what they should really be calling it is “cheating, debasing and inflating”.

#12 Many of the major trading partners of the United States are expressing deep resentment regarding the new quantitative easing policy announced by the Fed.  Ambrose Evans-Pritchard recently described the growing animosity this way….

Li Deshui from Beijing’s Economic Commission said a string of Asian states share China’s “deep bitterness” over dollar debasement, and are examining ways of teaming up to insulate themselves from the tsunami of US liquidity.

#13 For many analysts, the economic collapse of the United States comes down to cold, hard math.  For example, the former CEO of the tenth largest bank in the United States says that it is a “mathematical certainty” that the U.S. government will eventually go bankrupt.

#14 According to a recent article on CNBC, the financial world is already buzzing about QE3….

“They’re already talking about QE3,” said Dave Rovelli, managing director of US equity trading for Canaccord Adams. “Eventually we’re going to be printing so much money the dollar is going to really go down and everybody’s going to try to deflate their currency against us. I just don’t know how this could end well.”

So is that all the Federal Reserve has left?

Are they just going to keep pouring bags of money into the economy until things get back to “normal”?

Are we going to have “Quantitative Easing 3”, “Quantitative Easing 4”, and “Quantitative Easing 5”?

It has been a long-running joke, but perhaps by the end of this thing Ben Bernanke will literally go up in a helicopter and start shoveling out huge piles of cash over the countryside.

The era of great prosperity that we have all enjoyed for so long is coming to an end.  It would be advisable to use the remaining period of economic stability that we still have to prepare for what is ahead.

These economic problems could have been fixed decades ago if people would have actually listened and would have followed sound economic principles on an individual and on a corporate level, but that did not happen.

Now we are up to our eyeballs in debt and the greatest economic machine in history is rotting all around us.

We are in deep, deep, deep trouble and denying it is not going to make it go away.

15 Economic Statistics That Just Keep Getting Worse

A little over a week ago, U.S. Treasury Secretary Timothy Geithner penned an article for the New York Times entitled “Welcome To The Recovery” in which he touted the great strides that the U.S. economy was making.  But with unemployment still dangerously high and with foreclosures and personal bankruptcies continuing to set all-time records, should we really be talking about a “recovery”?  The truth is that the numbers don’t lie, and statistic after statistic shows that the economic fundamentals continue to get progressively worse.  The U.S. government can continue to try to pump up with economy with more debt, but the reality is that there is not going to be a legitimate “recovery” until consumer spending rebounds.  Consumer spending makes up the vast majority of U.S. GDP.  But without good jobs, consumers are not going to be able to spend money.  Unfortunately, our jobs base continues to be erode as millions upon millions of middle class jobs are shipped over to China, India and dozens of third world nations by the global predator corporations that now dominate the world economy.

The U.S. government cannot create real wealth out of thin air.  It can borrow even more money and flood the economy with even more paper currency, but the short-term “buzz” that creates does absolutely nothing to solve our long-term economic problems.

It is the private sector that actually creates wealth.  But unfortunately, over the last several decades we have allowed that wealth to become highly concentrated.  Now the giant global predator corporations have decided that American workers aren’t really that desirable after all.  They are slowly taking away their factories and their offices and they are moving them to where people are willing to work for one-tenth the pay. 

So where does that leave middle class American “consumers”?

Well, it leaves us in a world of hurt.

The following are 15 key economic statistics that just keep getting worse and which reveal the horrific economic plight in which we now find ourselves…. 

1 – The number of Americans who are receiving food stamps rose to a new all-time record of 40.8 million in May.  The number of Americans receiving food stamps has set a new all-time record for 18 months in a row.  But there is every indication that things are going to get even worse.  The U.S. Department of Agriculture projects that the number of Americans on food stamps will increase to 43 million in 2011. 

2 – The U.S. economy lost 131,000 more jobs during the month of July.  But the truth is that the U.S. economy has been bleeding jobs for a long time.  According to one analysis, the United States has lost 10.5 million jobs since 2007.  Meanwhile, immigrants (both legal and illegal) continue to pour into this nation in unprecedented numbers.

3 – Americans who are out of work are finding it incredibly difficult to get back into the workforce.  In the United States today, the average time needed to find a job has risen to an all-time record of 35.2 weeks.

4 – The U.S. government keeps trying to pump up the economy with debt, and in the process things are getting wildly out of control.  According to a U.S. Treasury Department report to Congress, the U.S. national debt will top $13.6 trillion this year and climb to an estimated $19.6 trillion by 2015.

5 – The interest on all of this debt is becoming increasingly oppressive.  As of July 1st, the U.S. government had spent $355 billion so far in 2010 on interest payments to the holders of the national debt.  The total for 2010 should be somewhere in the neighborhood of $700 billion.  According to Erskine Bowles, one of the heads of Barack Obama’s national debt commission, the U.S. government will be spending $2 trillion just on interest on the national debt by 2020.  Keep in mind that the entire U.S. government budget is less than $4 trillion for the entire year of 2010.

6 – If the U.S. government was forced to use GAAP accounting principles (like all publicly-traded corporations must), the annual U.S. government budget deficit would be somewhere in the neighborhood of $4 trillion to $5 trillion.

7 – Social Security will pay out more in benefits in 2010 than it receives in payroll taxes.  This was not supposed to happen until at least 2015.  In the years ahead, these new “Social Security deficits” are projected to be absolutely catastrophic. 

8 – There are simply far too many retirees and not nearly enough workers to support them.  Back in 1950 each retiree’s Social Security benefit was paid for by 16 workers.  Today, each retiree’s Social Security benefit is paid for by approximately 3.3 workers.  By 2025 it is projected that there will be approximately two workers for each retiree.

9 – Wealth continues to become highly concentrated at the top.  Since 1973, the average CEO’s salary has increased from 26 times the median income to over 300 times the median income.

10 – According to a poll taken in 2009, 61 percent of Americans “always or usually” live paycheck to paycheck.  That was up significantly from 49 percent in 2008 and 43 percent in 2007.

11 – The Mortgage Bankers Association recently announced that more than 10% of all U.S. homeowners with a mortgage had missed at least one mortgage payment during the January to March time period.  That was a new all-time record and represented an increase from 9.1 percent a year ago.

12 – A recent survey of last year’s college graduates found that 80 percent moved right back home with their parents after graduation.  That was up substantially from 63 percent in 2006.

13 – During the first quarter of 2010, the total number of loans that are at least three months past due in the United States increased for the 16th consecutive quarter.

14 – The total number of U.S. bank failures passed the 100 mark in July of this year.  In 2009, the total number of U.S. bank failures did not pass the century barrier until October.

15 – The U.S. dollar continues to rapidly decline in value.  An item that cost $20.00 in 1970 would cost you $112.35 today.  An item that cost $20.00 in 1913 would cost you $440.33 today.

Any rational observer (and clearly U.S. Treasury Secretary Timothy Geithner does not qualify) can see that the foundations of the U.S. economy are coming apart.  The rapidly accumulating mountain of debt that has fueled our “prosperity” is impossible to repay and is going to progressively choke the life out of our economic system.  The good jobs that we have allowed to be shipped out of our country are never coming back.  Every single day, more wealth flows out of this country than flows into it.

Anyone who claims that things are getting “better” is either ignorant, completely deluded or is purposely lying. 

The U.S. economy is not getting “better”.

The U.S. economy is dying.

You should adjust your plans accordingly.

More Than 1 In 5 American Children Are Now Living Below The Poverty Line

Perhaps the greatest victims of the economic nightmare that is unfolding right in front of our eyes are our children.  The overall economic numbers are really bad, but when you examine the impact that this economy is having on children things get really horrifying.  Today, 1 in 5 American children live in poverty and 1 in 4 American children are on food stamps.  Experts tell us that about 50 percent of all U.S. children will be on food stamps at some point before they reach the age of 18.  Up to half a million American children are homeless even as you read this.  And yet we continue to insist that we are the wealthiest nation in the world.  Well, if we are so wealthy, then why are so many millions of our children suffering so desperately? 

Part of the reason is because an increasing number of parents can’t find work.  According to a U.S. Labor Department report, the average duration of unemployment in the United States hit 34.4 weeks in May, which was a big increase from 33 weeks during April.  To give you some perspective how incredibly bad that is, the average duration of unemployment was only 16.5 weeks in December 2007.

The truth is that when U.S. workers lose their jobs they are finding it exceedingly difficult to find new ones.

In fact, 45.9% of those currently unemployed in America have been out of work longer than six months.  That is the highest percentage since the Labor Department began keeping track of this statistic back in 1948.

So is there much hope that things will turn around soon?

No, not really.

In fact, Federal Reserve Chairman Ben Bernanke says that unemployment is likely to remain “high for a while”.

That means a lot of children are going to continue to suffer.

According to one shocking new study, 21 percent of all children in the United States are living below the poverty line in 2010. 

That means that more than 1 in 5 American children are now living in poverty.

That is a national disgrace.

Not only that, but the same report estimates that up to 500,000 children may currently be homeless in the United States.

Perhaps we should all think about that while we are enjoying our nice dinners tonight.

But most of us don’t think that it is our job to do anything about it.  Most of us have been trained that it is the job of the government to fix people’s problems.

We have created a monolithic welfare state and record numbers of Americans are now dependent on it.

In fact, for the first time ever, more than 40 million Americans are on food stamps.

40.2 million Americans received food stamps in March, which was a whopping 21 percent increase from a year earlier.

But it is bad enough that 1 out of every 8 Americans is on food stamps.  What is far more tragic is that one out of every four U.S. children is now on food stamps.  In fact, as mentioned previously, experts tell us that half of all U.S. children will be on food stamps at some point before they turn 18.

So is anyone still not convinced that the U.S. economic system is broken?

So who is doing well these days?

The wealthy.

In 2009, the number of millionaires in the United States rose 16 percent to 7.8 million.

Wall Street bonuses for 2009 were up 17 percent when compared with 2008.

The rich are getting richer as the poor are getting poorer.  According to the United Nations, the United States has the highest level of income inequality of all of the highly industrialized nations.

The poor are left with an increasingly smaller slice of the pie to divide among themselves.  In fact, those in the bottom 40 percent now collectively own less than 1 percent of the nation’s wealth.

But the truth is that as the U.S. economy continues to fall apart, we are all going to experience some very difficult times.

In particular, when the U.S. economy finally completely implodes, it is those who are almost entirely dependent on the “system” that will suffer the most pain.  The vast majority of Americans live month to month, don’t grow any of their own food and could only last a couple of weeks on the food that they currently have in their homes.  So what will happen to those people when the system fails?

And in case you think that this kind of talk is fearmongering, perhaps you should start listening to what some of the top financial analysts around the world are saying. 

For example, Anthony Fry, the senior managing director at Evercore Partners, recently told CNBC that things are getting so bad out there that he is “considering investing in barbed wire and guns”.

Yes, things are really getting that bad.

Years ago the old timers would warn us that someday we would see Americans standing in bread lines.

Well, today food stamps are the new bread lines, and 40 million Americans a month find themselves dependent on the U.S. government for the food that they need to survive.

If that doesn’t send a chill down your spine perhaps you should check your pulse.

When a government has to feed 40 million people a month that means that the system is badly broken.

How many tens of millions of people have to be on food stamps before we can all agree that we are in a complete and total economic nightmare?

If you know of family or friends that are hurting, please consider helping them out.  The truth is that in the end we are all in this together.  The government is not going to save us.  The collapsing U.S. economy is not going to save us.  But if we all roll up our sleeves and work together perhaps we can make it through the difficult years that are coming.

$4.00 A Gallon Gasoline By The End Of 2010? How In The World Are Average Americans Going To Make Ends Meet If This Keeps Up?

Gas prices are on the rise again.  In many areas of the U.S. gas prices are already hovering around $3.00 a gallon.  In fact there are some areas where people are paying as much as $3.50 a gallon, and many experts are predicting that gasoline could hit $4.00 a gallon by the end of 2010.  If this nonsense keeps up, how in the world is the average American family supposed to make ends meet?  Not only is filling up our tanks going to cost a lot more, but the price of gasoline factors into so many other things.  The U.S. economy just cannot handle a major increase in transportation costs at this point.  These increasing gasoline prices come at a time when U.S. consumers are already stretched to the max.

But it isn’t just gasoline prices that are going up.  The price of food is really starting to rise as well.  Rising demand and reduced supply drove supermarket prices for 16 basic foods up 6.2% in the first quarter of 2010.

Now, for those Americans who are independently wealthy, a large increase in gasoline and food prices might not mean much.

But for the rest of us who are trying to get our incomes to stretch as far as possible each month, it means a whole lot.

In fact, a record number of working Americans are finding that their paychecks are just not making it and are turning to government assistance programs such as food stamps just to make it.

According to the U.S. Department of Agriculture, approximately 39.4 million Americans, a new all-time record, received food stamps in January.  This was up 22% from a year earlier.  In fact, the number of Americans on food stamps has hit all-time records for 14 consecutive months.

New all-time records for 14 months in a row?

How in the world can anyone claim that the U.S. economy is in good shape?

And it is just not people who are out of work or who are lazy who are applying for food stamps.  The truth is that a lot of hard working Americans who are doing everything they can to better themselves find themselves out of alternatives these days.

Some of those hard working Americans are readers of this site.  One of them recently left a comment that is very timely….

There are people on food stamps now, that you would never think they were. For example myself, I just went on food stamps last month. I am not a welfare mom, unemployed or declaring bankruptcy, I am educated and working as hard as I can to make ends meet.

I hold a Masters degree, and a part time job. I make minimum wage and if I were scheduled 40 hours a week my pay would just cover my expenses. Problem is, with retail the number of hours changes from week to week, and it hasn’t been near 40 since Christmas. Luckily I planned ahead and put money aside if I couldn’t find a job right out of school, or if I found one and lost it with today’s economy. I have been able to cover the bills my paycheck doesn’t, but the thing is, my savings has gotten low to that.

I honestly really didn’t want to go on food stamps, I just can’t find another job. Let that be a full time position, or even another part time one. I’m applying to everything I’m qualified for, remotely qualified for, and even over qualified for. But there really are that few of jobs out there.

I haven’t really told anyone I’m on food stamps, a good portion of my old friends are still in school and don’t understand why I can’t find a “real” job. Luckily at my new job there’s a whole store of people who know exactly what I’m going through and would never think of judging me for how much I make or where I live.

There are other people too. Once at work a mother with three kids came in, she had never used food stamps before and had no idea what to do at the register. She almost came to tears trying to explain she really didn’t want to use them, but her husband lost his job, and all that was left for the family was her part time job, and she was so ashamed they had them.

People really have no idea how many of their neighbors are on food stamps.

—-

Millions of Americans have done everything that the system has told them to do, and now the system is letting them down.

Why?

Because the system is failing.

The middle class is slowly being squeezed out of existence, and the years ahead are going to be very painful.

Already, it is getting extremely hard to live a middle class lifestyle.

If you haven’t read “It’s Impossible to Get By In the US” by Graham Summers of Phoenix Capital Research, you really need to.  In his article, Summers analyzes the expenses of a typical family making the median U.S. household income of $50,300 (he was using 2008 figures).  According to Summers, if a family making that much did everything right financially, they would maybe have a couple hundred bucks at the end of the month for discretionary spending.  But if they overpaid for their house or had any consumer debt then according to his calculations the typical American family would be operating in the red.

The truth is that the day is fast approaching when it will not be possible for the average American family to make it from month to month.

Even now record numbers of American families are failing financially.

In March 2010, there were 158,000 bankruptcy filings.  That was up 19% from March 2009’s number, and it was also up 35% from February 2010’s number.

Things are getting scary out there.

But if all of that wasn’t bad enough, now state and local governments across the United States are either implementing or are considering substantial tax increases.  State and local governments all over the U.S. are facing unprecedented shortfalls, and they are looking for new sources of revenue.  But you just can’t get blood out of a stone.  Unfortunately, they are likely to keep finding ways to impose new taxes on us anyway.

So is there any good news?

No, not really.

The United States is heading for a complete economic collapse and everyone is going to feel the pain one way or another.

Just make sure that you and your family are as prepared as possible for the years ahead.

“The way to crush the bourgeoisie is to grind them between the millstones of taxation and inflation.”
-Vladimir Lenin

My New Book - The Beginning Of The End

A Record Number Of Americans Turn To Food Stamps As America Is Gripped By Economic Despair

Food StampsWould you ever accept government welfare?  Would you look down on someone who does?  Well, if you would look down on a fellow American who receives food stamps then get ready to look down on a massive sea of people.  The truth is that over 37 million Americans now receive food stamps, and the program is expanding at a pace of about 20,000 people a day.  As hordes of Americans have been forced out of their jobs and their homes, millions are finding that the only way they can make it is to accept food stamps.  For many it is a tremendously humbling moment to turn to the government for help, and for so many millions to be dependent on the food stamps program is yet another indication of how deep the economic despair in America has gotten.

Most of the time you won’t even notice them being used at the checkout counters.  Today food stamps take the form of inconspicuous plastic cards and they can be used to purchase a wide variety of food items.  A record 37.2 million people, which is approximately one out of every eight Americans, received food stamps in September, and that number is growing rapidly.

In particular, children are being enrolled in this program in staggering numbers.

One out of every four children in America now gets assistance from food stamps each month.  In fact, it is projected that half of all U.S. kids will be on food stamps at some point in their lives.

So if nobody in your family has ever had to go on food stamps consider yourself to be very fortunate.

Things are particularly bad in rural areas such as Tennessee.  Nearly 1,186,000 people who live in Tennessee, or more than one in six residents, currently receive some kind of food stamp assistance and that number is rapidly increasing.

But there are places where things are even worse.  In fact, there are 239 counties in the United States where at least a quarter of the population now receives food stamps.

Not only that, but it has now come out that about one in 50 Americans lives in a household with a reported income that consists of nothing but food stamps.

Can you imagine trying to live on nothing but food stamp assistance?

That is the case for 2 percent of all Americans.

Can you imagine the despair they must feel?

So is there economic hope on the horizon?

Hardly.

The number of Americans filing for personal bankruptcy rose by nearly a third in 2009.

In addition, the number of people preparing to buy a home in November fell sharply in the latest sign that the housing market may be headed for another downturn.

So more Americans are going to go broke.

And more Americans are going to lose their homes.

And a whole more Americans are going to end up on food stamps.

Can you feel the despair in the air?

We can.

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