18 Sobering Facts Which Prove That The Middle Class Is Not Being Included In This “Economic Recovery”

Have you heard the news?  The stock market is absolutely soaring and according to the U.S. government and the Federal Reserve we are in the beginning stages of a robust economic recovery.  Yippee!  The S&P 500 is up 6.8 percent so far in 2011, and the stock market recently hit a two and a half year high.  So shouldn’t we all be celebrating?  Well, if stock market performance was an accurate measure of economic health, then Zimbabwe would have had one of the healthiest economies on the entire globe during the last decade.  But just like Zimbabwe’s stock market was artificially pumped up with “funny money” that was rapidly being devalued, so is ours.  All of the “quantitative easing” that the Federal Reserve has been doing is pumping plenty of money into the financial markets and is helping to inflate a false stock market bubble, but it is doing very little to alleviate the suffering of the U.S. middle class.  In fact, when you take a closer look at the numbers you quickly find out that the suffering of the middle class is getting even worse.

According to Gallup, the unemployment rate is now over 10%.  The number of Americans that have given up looking for work recently set a new all-time record.  The number of mortgages in foreclosure tied a record high during the fourth quarter of 2010.  Gas and food prices are rising rapidly.  The number of Americans on food stamps continues to increase every single month.

Yes, right now the economic situation is not in free fall like it was a couple years ago.  We should be thankful for that.  Periods of relative stability such as we are enjoying now will be few and far between in the years ahead.  This “bubble” of economic calm is a great opportunity that we should all be taking advantage of.

However, those that are hoping that this is an economic “turning point” and that things will soon be back to “normal” are going to be greatly disappointed.  This is about as “normal” as things are going to be ever again.

Even during this time of relative economic stability, the U.S. middle class is still being ripped to shreds.  If there are those among your family and friends that are somehow convinced that the U.S. economy is recovering nicely, you might want want to show them the following 18 very sobering facts….

#1 According to Gallup, the U.S. unemployment rate is currently 10.3 percent.  When you add in part-time American workers that want full-time employment, that number rises to 20.2 percent.

#2 According to the U.S. Bureau of Labor Statistics, the number of job openings in the United States declined for a second straight month during December.

#3 There are currently more than 4 million Americans that have been unemployed for more than a year.

#4 The number of Americans that have become so discouraged that they have given up searching for work completely now stands at an all-time high.

#5 Gasoline prices in the United States recently hit a 28-month high.

#6 During the 4th quarter of 2010, 4.63 percent of all U.S. home loans were in foreclosure.  That matched the all-time high, and it was up significantly from 4.39 percent in the 3rd quarter.

#7 It is estimated that there are about 5 million homeowners in the United States that are at least two months behind on their mortgages, and it is being projected that over a million American families will be booted out of their homes this year alone.

#8 Almost 14 percent of all credit card accounts in the United States are currently 90 days or more delinquent.

#9 The average credit card rate in the United States had increased to a whopping 13.44 percent at the end of 2010.

#10 Americans now owe more than $890 billion on student loans, which is even more than they owe on credit cards.

#11 Average household debt in the United States has now reached a level of 136% of average household income.  In China, average household debt is only 17% of average household income.

#12 U.S. life expectancy at birth is now three years less than Canada and four years less than Japan.

#13 New home sales in the state of California were at the lowest level ever recorded in the month of January.

#14 43 percent of all mortgages in south Florida are currently underwater.

#15 Prior to the most recent economic downturn, there were usually somewhere around four to five million job openings in America.  Today there are about 3 million.

#16 When you adjust wages for inflation, middle class workers in the United States make less money today than they did back in 1971.

#17 One out of every seven Americans is now on food stamps.

#18 One out of every six elderly Americans now lives below the federal poverty line.

You know things are bad when articles start popping up in the mainstream news instructing us how to interact socially with the hordes of unemployed Americans that are out there today.  A recent USA Today article entitled “What not to say to someone who is unemployed” listed some of the things that you should not say to someone that does not have a job.  The following are some of their suggestions on what NOT to say….

“Hey, have you found anything yet?”

“How’s the search going?”

“You just have to pound the pavement.”

“Something will turn up.”

“It’s tough out there.”

“Other people are going through the same thing.”

“Maybe you’re asking for too much money.”

“Maybe you should go back to school.”

“There are plenty of jobs out there.”

I am sure most of us have heard things like this at one time or another.  It can be a soul-crushing thing to have others like at you in pity because you don’t have a job and you can’t pay the mortgage and feed your family.

Most unemployed Americans are not lazy.  The vast majority of them desperately want jobs.  But the U.S. economy is not producing nearly enough jobs today.  As noted above, the U.S. economy currently has about 3 million job openings, but approximately 20 percent of the workforce wants to find a full-time job.  The demand for jobs is far, far, far greater than the supply.

Unfortunately, this is the legacy of decades of bad economic decision-making.  The U.S. economy should be able to provide work for every single person that wants it, but because of the choices that have been made that will never be the case again.

The middle class in America is being ripped to shreds right in front of our eyes and very little is being done to stop it.  Desperation is rising across the nation.  More Americans slip into poverty every single day.  It is almost as if a cloud of gloom and despair has descended upon the U.S. economy and every single month the situation only seems to get darker.

So what about you?  How has this economy affected you and your family?  Please feel free to leave a comment with your thoughts below….

12 Ominous Signs For World Financial Markets

Can anyone explain the very strange behavior that we are seeing in world financial markets right now?  Corporate insiders are bailing out of the U.S. stock market at a very alarming rate.  Investors are moving mountains of money into gold and other commodities.  In fact, there is such a rush towards gold that shortages are starting to be reported in some areas.  Meanwhile, some very, very unusual option activity has started to show up.  In particular, someone is making some incredibly large bets that the S&P 500 is going to absolutely tank during the month of October.  Central banks around the world have caught a case of “loose money fever” and are apparently hoping that a new flood of paper money will shock the global economy back to life.  Meanwhile, the furor over the foreclosure procedure abuses of the major U.S mortgage companies threatens to bring even more turmoil to the U.S. housing industry.

There are some very ominous signs that something is just not right in world financial markets right now.  Some of the signs listed below may be related.  Others may not be.  That is for you to decide.

Often, just before something really bad happens, you can actually see the rats leaving a sinking ship if you know where to look.  The truth is that if things are going to go south it is the insiders who know before anyone else.

So are some of the signs below actually clues for what we should expect in the months ahead?

Maybe.

Maybe not.

You make your own call.

But it is becoming hard to deny that there are some serious danger signs out there at this point….    

#1 Corporate insiders are getting out of the U.S. stock market at an absolutely blinding pace.  It is being reported that the ratio of corporate insider selling to corporate insider buying last week was 1,411 to 1, and this week the ratio has soared even higher and is at 2,341 to 1.

#2 Many of the world’s wealthiest people are buying absolutely massive quantities of gold right now.

#3 It is being reported that J.P. Morgan is gobbling up the rights to as much physical gold as it possibly can.

#4 The United States Mint has announced that it has run out of 1-ounce, 24-karat American Buffalo gold bullion coins and that it will not be selling any more of them in 2010.

#5 It is becoming increasingly difficult to explain the unusually high option volume that we are witnessing right now.

#6 Some very large investors are making massive bets that the S&P 500 is going to take a serious tumble during the month of October.

#7 On Tuesday, the Bank of Japan shocked world financial markets by cutting interest rates even closer to zero and by setting up a 5 trillion yen quantitative easing fund.

#8 The president of the Federal Reserve Bank of New York and the president of the Federal Reserve Bank of Chicago are both publicly urging the Fed to do much more to stimulate the U.S. economy, including beginning a new round of quantitative easing, even if it means a significant rise in the U.S. inflation rate.

#9 Nobel Prize-winning economist Joseph Stiglitz told reporters on Tuesday that the loose monetary policies of the Federal Reserve and the European Central Bank are throwing the world into “chaos”.

#10 At the end of September, federal regulators announced a $30 billion bailout of the U.S. wholesale credit union system.

#11 Bank of America, JPMorgan Chase and GMAC Mortgage have all suspended foreclosures in many U.S. states due to serious concerns about foreclosure procedures.  Now, Texas Attorney General Greg Abbott is actually demanding that all mortgage servicing companies in the state of Texas immediately suspend all foreclosures, the selling of foreclosed properties and the eviction of people living in foreclosed properties until they have completed a review of their foreclosure procedures.

#12 Not only that, but Nancy Pelosi and 30 other members of Congress are requesting a federal investigation of the foreclosure practices of U.S. mortgage lenders.  Needless to say, this controversy has the potential to turn the entire U.S. mortgage industry into an absolute quagmire.

So are dark days ahead for world financial markets?

Well, yeah, but it is incredibly hard to predict exactly when things are going to fall apart.

The truth is that there are going to be a whole lot more “crashes” and “collapses” in the years ahead.

The important thing, as discussed yesterday, is to keep your eye on the long-term trends.

The U.S. economy is undeniably in decline.  The only thing keeping the economy going at this point is a rapidly growing sea of red ink.  Debt is literally everywhere.  It is what our entire financial system is based on in 2010. 

In the months and years to come, the major players are going to try very hard to keep all the balls in the air and to continue the massive shell game that is going on, but in the end the whole thing is going to collapse like a house of cards.

Unfortunately, we have been destroying the U.S. economy for decades and there is simply not going to be a happy ending to this story.

The Economic Collapse