“Worst Year Ever”: The Chinese Ban On U.S. Agricultural Products Will Be A Death Blow For Countless U.S. Farms

U.S. farmers have never experienced a year quite like this.  During the first half of 2019, endless rain and unprecedented flooding were the major problems.  As a result of the incredibly wet conditions, millions of acres of prime farmland didn’t get planted at all, and tens of millions of other acres are going to yield a lot less than usual.  Even without anything else happening, we were going to see farm bankruptcies soar to absolutely crazy levels, but now the Chinese government is essentially cutting off U.S. agricultural imports.  This will greatly depress the prices that U.S. farmers get for their crops, and so many farmers that were still hoping to squeeze out a profit for this year will be hit with a loss instead.  Ultimately, the truth is that 2019 is going to be a death blow for countless U.S. farmers that were barely hanging on financially after a string of really tough years.  Many will leave the industry entirely and never go back to farming again, and our nation will be worse off because of it.

When the Chinese announced that they were going to completely stop buying U.S. agricultural products, it sent shockwaves across the middle portion of the country.  According to the executive vice president of the American Farm Bureau, our farmers and ranchers will now be facing “just a really tough, tough time”

“This is a body blow to farmers and ranchers all across the country,” Dale Moore, executive vice president of the American Farm Bureau, told FOX Business. “That’s one of the things that we are feeling the effects of, and this is on top of a year when mother nature has been a terrible business partner in many parts of the country. It’s just a really tough, tough time for farmers and ranchers in this country.”

Shares of industrial, farming, oil and transportation companies have plummeted, a direct result of the increased tensions between the world’s two largest economies.

Of course President Trump is trying to be upbeat and he is promising that the Chinese will not be able to hurt our farmers, but the truth is that they already have.

Chinese imports of U.S. agricultural products fell by more than half from 2017 to 2018, and now they are going to zero.  The following comes from Fox Business

Despite Trump’s tweet, American farmers now stand to lose all of what was a $9.1 billion market in 2018, which was down sharply from the $19.5 billion U.S. farmers exported to China in 2017.

Unfortunately for U.S. farmers, they are caught right in the middle of a tug of war between the Chinese government and President Trump, and China specifically went after U.S. farmers in order to hurt Trump politically

China’s new agricultural ban has an additional benefit to the Chinese of maximizing negative political impact to Trump.

Important presidential election swing states in the Midwest grain belt such as Iowa and Wisconsin were vital to his 2016 election victory. Cutting this particular area of bilateral trade at a time when American farmers are recovering from the after-effects of this year’s floods is a potent way for Beijing to punch back against President Trump’s new tariffs.

If the presidential election was held this November, it would be really difficult for Trump to win in Iowa in Wisconsin.  Of course much can change between now and November 2020, but right now Trump is definitely losing support in the middle of the country.

Speaking of Wisconsin, it just happens to be one of the states that currently has the highest number of farm bankruptcy filings

Since last June, there have been a staggering 535 Chapter 12 bankruptcy filings, a 13 percent increase. Kansas, Minnesota and Wisconsin had the highest number of filings.

As a result, Congress passed the Family Farmer Relief Act to update the eligibility requirements for Chapter 12 bankruptcy, raising the debt limit from $4.1 million to $10 million — giving more farmers the chance to declare bankruptcy, thereby offering their producers and creditors a better chance to recognize and avoid mass liquidation.

President Trump will try to keep as many farms going as possible with his massive aid packages, but the truth is that even with those aid packages it is inevitable that farm bankruptcies will continue to surge.

In fact, they are already at the highest level that we have seen since the last recession.

What U.S. farmers really need is an end to the trade war and for the Chinese to start buying from them again.

Sadly, that is just not going to happen.  At this point, even Goldman Sachs is admitting that there will not be a trade deal with China before the 2020 presidential election…

Analysts at Goldman Sachs no longer think the U.S. and China will manage to negotiate a trade deal ahead of the 2020 presidential election — which is more than 15 months away.

“We had expected a final round of tariffs targeting remaining Chinese imports at a 10 percent rate,” the analysts, led by chief U.S. economist Jan Hatzius, wrote in a note to clients. “But news since President Trump’s tariff announcement last Thursday indicates that U.S. and Chinese policymakers are taking a harder line, and we no longer expect a trade deal before the 2020 election.”

This means that things will continue to go from bad to worse for U.S. farmers, and this will take a major toll on the U.S. economy as a whole.

We have entered the time of “the perfect storm”, and things are definitely not going to get any easier in the months ahead.

I wish that I had better news for you, but I don’t.  Global events are starting to greatly accelerate, and so many of the things that we have been warned about are starting to happen right in front of our eyes.

About the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

New Tariffs, Stocks Plunge, Manufacturing Falls Again And More Layoffs – But Everything Is “Fine”?

Things are starting to go downhill rather quickly now.  A day after the Federal Reserve cut interest rates for the first time in more than a decade, we received a whole bunch more bad economic news.  Most Americans don’t realize it yet, but our economy is in serious trouble.  We haven’t seen anything like this since the last recession, but most people seem to think that since stock prices are still very high that everything must be fine.  No, everything is definitely not “fine”, and as I noted yesterday, a lot of prominent names are loudly sounding the alarm.  Many analysts are expecting things to really start breaking loose as we get deeper into the second half of this year, and what we witnessed on Thursday certainly didn’t make the outlook any brighter.

President Trump completely shocked Wall Street when he announced that yet another round of tariffs will be imposed upon Chinese goods.  According to CNBC, these new tariffs will go into effect on September 1st…

Trump said in a series of tweets the tariff will be imposed on $300 billion worth of Chinese goods. The levy will take effect Sept. 1.

He said later in the day those levies could go up to 25%. Trump’s comments came after a U.S. delegation met with Chinese trade officials earlier this week. Those were the first in-person trade talks between China and the U.S. since both countries reached a truce on the situation.

This is essentially the equivalent of a “gut punch”, and it definitely takes our trade war with China to an entirely new level.

And Trump told the press that the tariffs will remain in place until the U.S. and China agree to a deal.  The following comes from Fox Business

President Trump said on Thursday the U.S. will continue to tax China until the world’s two largest economies reach a trade agreement .

“When my people came home they said we were talking. We have another meeting in September. Until such time as there is a deal we will be taxing them,” he said from the White House’s south lawn.

But as I have repeatedly explained to my readers, there isn’t going to be an agreement any time soon.  In fact, it is extremely doubtful that we will see one before the 2020 presidential election.  Trump is not going to back down from his core demands, the Chinese will never accept them, and China would much prefer to negotiate with whoever follows Trump in the Oval Office.

So these tariffs are here to stay, China will inevitably retaliate once again, and global economic activity will suffer.

But Trump doesn’t seem alarmed.  On Thursday, he also told reporters that if China doesn’t want to trade with the United States anymore “that would be fine with me”

“For many years China has been taking money out by the hundreds billions of dollars a year. We have rebuilt China so now it is time that we changed things around. If they didn’t want to trade with us anymore that would be fine with me. It would save us a lot of money,” Trump told reporters Thursday.

Those are very strong words, and Trump actually has a point.

In the short-term, decoupling from the Chinese economy is going to be extremely painful for us.  But the truth is that we should have never integrated our economy so deeply with China’s economy in the first place.  The Chinese government is one of the most tyrannical regimes on the entire planet, and they have no respect for basic human rights.  Trade agreements that were extremely unfavorable for the United States allowed China to become exceedingly wealthy at our expense, and the Chinese would like to continue taking advantage of us indefinitely if they could.

So something definitely needed to be done about China, but it is going to be a really, really painful period of adjustment for the U.S. economy.

After Wall Street learned of the new tariffs on Thursday, stock prices immediately began to plummet

When President Donald Trump announced a new round of tariffs on Chinese imports on Thursday, the Dow was up 311 points. Then it was down nearly 300 points.

That was the biggest swing since early January.

And it certainly would not be a surprise if stock prices continued to go down.  As I noted the other day, the stock market is more primed for a crash than it has ever been before.

At this point, stock prices are completely and totally disconnected from economic reality.  As stocks hit record high after record high in July, bad economic news just kept pouring in.

Of course August certainly just started off with a bang.  On Thursday, we learned that a key measure of U.S. manufacturing activity has fallen to the lowest level since September 2009

The IHS Markit Manufacturing Purchasing Managers’ Index fell to 50.4 in July, down from 50.6 in June, driven by a weaker demand. The firm also noted managers’ signaled slower hiring.

In addition, Lowe’s just announced that they will be “laying off thousands of workers”

Lowe’s is laying off thousands of workers.

Layoffs will include assemblers, who put together items like grills and patio furniture. The company will also cut maintenance and facility-service jobs, such as janitors. The company said it is outsourcing those positions to third-party companies.

Lowe’s (LOW) declined to say exactly how many workers will be laid off. It said that workers whose jobs are being eliminated will be given transition pay and have the opportunity to apply for open roles at Lowe’s. The Wall Street Journal first reported Lowe’s plan.

This is the continuation of a trend that I have been tracking for months.  Big companies have been laying off workers at a level that we haven’t seen since the last recession, and many believe that what we have witnessed so far is just the beginning.

Also, the “trucking apocalypse” just continues to accelerate.  The following comes from Zero Hedge

Yet another trucking company has fallen victim to the recession in freight this year, according to FreightWaves. Terrill Transportation of Livermore, California shut its doors unexpectedly on July 30. The company had been in business 25 years.

Customer Manny Bhandal, president of Bhandal Bros. Inc., said that three of his trucks arrived at Terrill on July 30 to drop off a shipment and were turned away. Kevin Terrill, president of Terrill Transportation, did not respond to FreightWaves.

If the U.S. economy really was in “fine” shape, trucking company after trucking company would not be shutting their doors.

Sadly, instead of heeding the warning signs and using this time to get prepared for rough times ahead, most Americans are choosing to use this time to party.

And there is certainly not anything wrong with enjoying life, but we have gotten to the point where it is crystal clear that a new crisis is upon us, and most Americans are completely and utterly unprepared for what is about to happen.

I will continue to track these developments as they unfold.  We are truly in unprecedented territory, and I have a feeling that the second half of 2019 is going to be far more “interesting” than the first half was.

About the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

Trump Just Poked The Dragon In The Eye, And U.S.-China Relations Just Took An Ominous Turn For The Worse

After what President Trump just did, the odds of the U.S. and China being able to reach a trade agreement this year officially just went from slim to none.  For China, there is no issue more sensitive than the status of Taiwan.  For the Chinese, it is unthinkable for anyone to even suggest that Taiwan is not a part of China, and the Chinese are prepared to defend their “one China” policy to the death if necessary.  On the other hand, most Americans are entirely clueless about Taiwan.  In fact, if you gave them a blank map of the world the vast majority of Americans wouldn’t even be able to find Taiwan thanks to our exceedingly poor system of public education.  So for most Americans, a news story about how President Trump plans to sell 2 billion dollars worth of arms to Taiwan is completely and utterly meaningless.  But for the Chinese, such news is a deep national insult

The United States is pursuing the sale of more than $2 billion worth of tanks and weapons to Taiwan, four people familiar with the negotiations said, in a move likely to anger China as a trade war between the world’s two biggest economies escalates.

An informal notification of the proposed sale has been sent to the U.S. Congress, the four sources said on condition of anonymity because they were not authorized to speak about the possible deal.

This arms sale barely made a blip in the U.S. news cycle, but over in China they are officially freaking out about this.  According to one report, this deal would send “over 100 tanks and almost 2,000 missiles” to Taiwan…

The US, which is the main weapons dealer to Taiwan, would send over 100 tanks and almost 2,000 missiles to the island. There was outrage in China, who said they were seriously concerned after Taiwan’s defence ministry confirmed the sale. The move is believed to further heighten tensions between Beijing and Washington.

It comes days after Chinese defence minister Wei Fenghe said: “If anyone dares to split Taiwan from China, the Chinese military has no choice but to fight at all costs.”

You can do quite a bit of damage with 2,000 missiles.

Most Americans may not realize this, but the truth is that U.S.-China relations just took a really ominous turn for the worse.

And in addition to announcing this arms sale to Taiwan, President Trump also just threatened China with even more tariffs

DONALD Trump threatened to hit China with tariffs on “at least” another $300bn worth of goods today – as a Beijing propaganda campaign painted the US as evil bullies.

Tensions between the world’s two largest economies have soared sharply since talks aimed at ending a festering trade war broke down in early May.

But trust me, the announcement of the arms sale to Taiwan was far, far more insulting to China than the tariff threat was.

On the Chinese side, they have decided to hit the U.S. right in the farm belt by “putting purchases of U.S. soybeans on hold”

China is reportedly putting purchases of U.S. soybeans on hold amid the growing trade war with the U.S., according to a report from Bloomberg News. As the world’s largest soybean buyer, China’s move could ramp up the economic pressure on American farmers.

This has already been the worst year for U.S. farmers in decades, and this move by the Chinese is going to make things even worse.  For much more on this, please see an article that I posted earlier today entitled “U.S. Farms Are Facing Their Worst Crisis In A Generation – And Now Here Comes Another Monster Storm”.

Also, anti-American rhetoric in China has now reached a fever pitch.  According to CNN, the Chinese just issued an official alert warning Chinese travelers of “shooting, robbery and theft” in major U.S. cities…

On Tuesday, China’s Culture and Tourism Ministry warned its citizens of the risks of traveling to the US in an alert, citing frequent recent cases of “shooting, robbery and theft.”

On the same day, the country’s Foreign Ministry — along with China’s embassy and consulates in the US — issued a security alert for Chinese citizens, alleging “repeated harassment” of Chinese nationals in the US by local law enforcement officials.

Of course the Chinese are correct when they warn about the violence in our cities.  For example, more than 50 people were shot in the city of Chicago last weekend alone.

In addition to the travel warnings, Chinese state media is doing all that it can to put the U.S. in a bad light.  In fact, one major Chinese paper just called the United States the “enemy of the world”

The new travel advice did not come in isolation.

China’s ruling Communist Party has launched a trade war propaganda campaign, with recent efforts — delivered via state media — focusing on US “trade bullying” and “hegemony.” In one noteworthy article, published Tuesday in party mouthpiece the People’s Daily, the US was labeled the “enemy of the world.”

Does it sound to you like the Chinese are ready to surrender and head back to the negotiating table?

No, the truth is that they are just getting angrier with every week that goes by.  Most Americans don’t even know that we fought against the Chinese during the latter stages of the Korean War, but right now over in China those old battles against “the evil American invaders” are being publicly celebrated

President Xi Jinping’s state media has even begun to refer to a very bloody battle between America and Chinese forces during the Korean War.

The 1952 battle of Triangle Hill – or Shangganling in Chinese – has been glorified in China for decades as a turning point in the war.

School children are told how the sacrifice of Chinese soldiers eventually led to the “defeat of the evil American invaders”.

At this point, most Americans may be vaguely aware that some sort of a trade war is going on, but over in China they are taking this deadly seriously.  And without a doubt, the stage is being set for a full-fledged global showdown between the two superpowers.

This is not a game, and if things go badly we could potentially be facing apocalyptic consequences.

So hopefully Trump knows what he is doing, because right now things appear to be starting to spiral out of control very rapidly.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

Economic Chaos Erupts! – Global Manufacturing Plunges, The Trade War Expands And The Nasdaq Enters Correction Territory

The global economic slowdown is really starting to accelerate.  Just within the past few days, we have gotten more really awful global manufacturing numbers, the trade war has expanded to more nations, and the Nasdaq has officially entered correction territory.  We have not witnessed this sort of global economic environment since the Great Recession, and if the economic chaos continues to escalate it won’t take too much to spark a brand new financial crisis.  Of course the global financial system is far more vulnerable than it was back in 2008, and so if we stay on the path that we are currently on we could be facing a nightmare scenario very rapidly.

Let’s talk about the manufacturing numbers first.  The numbers coming out of Germany are already at a crisis level, and manufacturing is also now contracting in Japan, South Korea and China as well.

Overall, global manufacturing as a whole has now fallen into contraction territory for the first time in seven years

Global manufacturing was the weakest since 2012 last month, a victim of mounting trade tensions and further reason to worry that the world economy is weakening.

With softness in Germany, Japan, the U.K. — as well as the lowest U.S. result in a decade — IHS Markit’s global Purchasing Managers Index fell to 49.8 in May, below the 50 level that divides expansion from contraction.

The reports underscore the growing threat posed by the escalating U.S.-China trade war, and they coincided with a fresh warning from Wall Street about recession risks.

The reason why so many people are freaking out about these numbers is because this is exactly what we would expect to see if we were entering a global recession.

Meanwhile, global financial markets are looking increasingly shaky.  On Monday, the Nasdaq fell another 120 points and it has now officially entered correction territory

Stocks ended mostly lower Monday, June’s first day of trading, amid reports that the U.S. government is planning to target a host of big tech companies with antitrust and business practice probes. Shares of Alphabet, Amazon, Facebook and Apple all weighed on the market during Monday’s session.

The Nasdaq dropped 1.6% to enter correction territory, closing more than 10% below its record high set in late April.

The term “correction territory” might not mean a lot to many of you, so let me put what is happening in terms you may understand.

On Monday alone, America’s most prominent tech stocks lost approximately 150 billion dollars in value.  It looks like the Trump administration is getting ready to go to war with the big tech companies, and that is really, really bad news for tech investors.  The following comes from Breitbart

The Masters of the Universe got hit hard by investors on Monday. Like $150 billion hard.

Shares of the top tech giants fell sharply on Monday after reports that U.S. antitrust regulators had divided up oversight of the sector, with the Department of Justice assuming responsibility for Alphabet and Apple and the Federal Trade Commission taking on Facebook and Amazon. This triggered fears that the government could mount challenges to the business models of the companies.

Shares of Alphabet dived 6.1 percent on Monday after the Wall Street Journal reported that the Justice Department is in the early stage of preparing an antitrust probe of the company. Reuters reported that the Department of Justice is also looking into Apple’s business for possible antitrust violations.

Speaking of war, our trade conflict with China continues to escalate.  The mainstream media hasn’t been talking much about it, but apparently the Chinese have decided to put purchases of U.S. soybeans “on hold” until a trade agreement is reached…

China, the world’s largest soybean buyer, has put purchases of American supplies on hold after the trade war between Washington and Beijing escalated, according to people familiar with the matter.

State-grain buyers haven’t received any further orders to continue with the so-called goodwill buying and don’t expect that to happen given the lack of agreement in trade negotiations, said the people, who asked not to be named because the information is private.

U.S. soybean farmers have been sitting on unprecedented amounts of soybeans in hopes that an end to the trade war would raise prices.

But instead, demand for U.S. soybeans is going to go through the floor, and this could potentially force thousands of soybean farmers into bankruptcy.

And in addition to our trade war with China, the Trump administration has apparently decided that now is a good time to start a trade war with Mexico

From produce to cars, a wide variety of Mexican goods could become more expensive if Trump follows through on his threat to hit Mexican imports with tariffs that soon could climb to 25%. Trump wants to pressure Mexico into doing more to halt the flow of Central American migrants to the U.S. via the Mexican border.

The tariffs, set to begin June 10, would gradually climb to 25% on Oct. 1 if Mexico doesn’t take steps “to dramatically reduce or eliminate” the number of migrants, Trump said Thursday. Such a strategy would hurt American shoppers, the economy and stocks, experts say, just as U.S. growth is slowing and the threat of more tariffs on Chinese imports looms larger.

At least in this case the U.S. and Mexico are still talking, and so perhaps some kind of resolution can be reached.

On top of everything else, the Trump administration has also just decided to add India to the trade war as well

Mr. Trump on Friday said India would be removed from the U.S.’s privileged-trading program called the Generalized System of Preferences on Wednesday. Under the decadeslong program meant for some developing economies, the U.S. had allowed India to avoid tariffs on certain exports to the U.S. in the interest of promoting tighter trade ties and development.

India, the U.S.’s ninth-largest trading partner, is a top beneficiary of the GSP program. Mr. Trump’s move will add tariffs of as much as 7% on Indian exports of goods like chemicals, auto parts and tableware to the U.S., which in 2018 accounted for more than 11%, or $6.3 billion, of India’s total exports of goods valued at $54.4 billion, according to the Congressional Research Service, a research agency for the U.S. Congress.

A global trade war is going to be incredibly painful for everyone, and this is all happening at a time when the global economy was already starting to slow down substantially.

Here in the United States, a lot of businesses are really starting to notice a big decline in economic activity.  Here is just one example that was published on Zero Hedge earlier today…

Down here, in Texas, I am seeing a big drop in economic activity over the last 6 months. Our healthcare businesses’ volume over this period is at 629, down from 770, year-on-year, almost a 20% decline, and the worst six month decline in our 15 year history. We have been pulling out all of the stops for business development, cutting overhead, and running all the QC traps to determine if it is something within our business, within our local market, within our industry, or having to do with the economy in general.

In this period, we have seen seven competitors go out of business in our city. We have recently confirmed similar experiences with colleagues in Kentucky, Colorado, and elsewhere in Texas. One of them asked me, “If this is not temporary, what would the strategy be?” My response was, “Hunker in the bunker and wait for everyone else to die.”

This is what we have all been preparing for, and things are going to get progressively tougher in the months ahead.

Unfortunately, most Americans are completely and totally clueless about what is ahead.  Today, 59 percent of all Americans are living paycheck to paycheck, and the truth is that the vast majority of us are entirely unprepared to go through another recession.

And of course many believe that what we are facing is going to be much worse than just a “recession”.  A perfect storm is rapidly coming together, and the chaos that we have seen so far is nothing compared to what is rapidly approaching.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

All Of The Economic Momentum Is Moving In Just One Direction Now

Earlier today, I was greeted by this jarring headline when I visited the Drudge Report: “BONDS FLASH RECESSION WARNING”.  These days, it seems like the “R word” is being thrown around constantly, but at this time last year everyone was celebrating how well the economy was doing.  Unfortunately, we have witnessed a dramatic shift in recent months, and we just got some more really bad economic numbers.  Thanks to those bad numbers and an increasing amount of anxiety about the trade war, the Dow Jones Industrial Average fell another 237 points on Monday.  That means that we are on pace to potentially see the Dow fall for a sixth week in a row, and that is something that hasn’t happened since the last recession.

But right now investors are far more spooked about what is going on in the bond market.  According to Mish Shedlock, we haven’t seen this many yield curve inversions “since the start of the Great Recession”…

On Friday, US Treasury yields plunged at the mid to long end of the curve providing the most inversions since the start of the Great Recession. This is the biggest recession warning since 2007.

In so many ways, what we are witnessing at this moment is very reminiscent of the conditions that prevailed just prior to the last financial crisis.

Back then, the economic numbers were definitely starting to slide, but most Americans didn’t think that we were heading toward big trouble.  But those that understood what was happening were sounding the alarm, and the same thing is happening today.  For example, the following comes from a CNBC article entitled “Morgan Stanley says economy is on ‘recession watch’ as bond market flashes warning”

“Recent data points suggest US earnings and economic risk is greater than most investors may think,” wrote Michael Wilson, the firm’s chief U.S. equity strategist.

Specifically, the stock strategist highlighted a recent survey from financial data firm IHS Markit that showed manufacturing activity fell to a nine-year low in May. That report also revealed a “notable slowdown” in the U.S. services sector, a key area for an American economy characterized by huge job gains in health care and business services.

In addition to disappointing manufacturing numbers, we also just learned that orders for capital goods were down significantly during the month of April…

The Commerce Department said on Friday orders for non-defense capital goods excluding aircraft, a closely watched proxy for business spending plans, dropped 0.9% last month as demand weakened almost across the board. Data for March was revised down to show these so-called core capital goods orders rising 0.3% instead of increasing 1.0% as previously reported.

Also, we just found out that U.S. home price gains have now fallen for 12 months in a row.

When you add those numbers to all of the other depressing economic numbers that have been rolling in lately, a very clear picture emerges.

The U.S. economy is heading in the wrong direction, and things are steadily getting worse.

A resolution to our trade war with China would be a huge economic boost in the short-term, but that is not likely to happen for the foreseeable future.  In fact, on Monday President Trump stated that he is “not ready” to make a deal with China

Bank shares fell broadly amid the lower interest rates. Goldman Sachs dropped 1.8% while Citigroup and J.P. Morgan Chase fell 0.9% and 1.1%, respectively. Morgan Stanley and Wells Fargo also slipped.

The drop in bank shares and rates come after President Donald Trump said on Monday the U.S. was “not ready” to make a deal with China, before adding he expected one in the future. Trump also said tariffs on Chinese imports could go up “substantially.”

And the Chinese are clearly digging in as well.  The chief editor of the Global Times, Hu Xijin, has a very close relationship with top Chinese officials, and he just warned that China “is seriously considering restricting rare earth exports” to the United States…

While the official at China’s national planning body did not directly answer whether Beijing would restrict rare earth exports to the United States, Global Times Editor-in-chief Hu Xijin wrote on Twitter: ‘Based on what I know, China is seriously considering restricting rare earth exports to the U.S. China may also take other countermeasures in the future.’

Although the tabloid Global Times is not one of China’s official media, it is widely read and is published by the ruling Communist Party’s People’s Party newspaper.

Just a few days ago I published an entire article about the impact that such a move would have on the U.S. economy, and I won’t reproduce all of that information here.

But the bottom line is this – the U.S. economy would be in a massive amount of trouble if that happened.

A deteriorating relationship with China is part of the scenario that we have been anticipating, and events are definitely starting to accelerate now.

For most Americans, however, there is no reason to be concerned.  Most of us simply trust that our leaders in Washington have things under control and that everything will work out just fine somehow.

But if we do plunge into another deep economic crisis, many Americans will be in enormous trouble right away.  According to one recent survey, 45 percent of us rate our financial situations as either “fair” or “poor”

Nearly 30% of respondents rate their financial situation as “only fair” and 15% say it’s “poor.” Meanwhile, 25% worry “all” or “most” of the time that their household income won’t be enough to cover their expenses.

Their biggest concerns: Saving enough for retirement and unplanned medical costs, with 54% and 51%, respectively, saying they’re “very” or “moderately” worried about each prospect.

In addition, another recent survey discovered that 59 percent of all Americans are currently living paycheck to paycheck.

Just like last time around, most Americans are living on the edge financially.

And just like last time around, millions of Americans will be completely blind-sided by an economic train wreck that they didn’t see coming.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

Wal-Mart Executive Warns: “Higher Tariffs Will Lead To Higher Prices For Customers”

Wal-Mart gets approximately one-fourth of all the merchandise that it sells from China, and Wal-Mart’s CFO is warning that “higher tariffs will lead to higher prices for customers”.  In other words, U.S. consumers will soon be feeling a lot of pain.  Over the last several decades, major retailers such as Wal-Mart have become increasingly dependent on exports from China, and U.S. consumers have loved the “low, low prices” because those rock bottom prices enabled our society to enjoy a greatly inflated standard of living.  Of course in the process we were mortgaging our own economic future, because we have lost more than 60,000 manufacturing facilities and millions of good paying jobs since China first joined the WTO in 2001.  But we didn’t care because ultra-low prices felt good, and so our economy became increasingly integrated with China’s economy.  Well, now a trade war has begun and people all over America are demanding that we get tough with China.  And without a doubt something needs to be done about China, but the process of decoupling from the Chinese economy is going to be exceedingly painful.  We should have never allowed ourselves to become so dependent on China in the first place, and now the consequences for our past foolishness are going to be very bitter indeed.

Previously, I have warned that this trade war will be particularly painful for those on the bottom of the economic food chain, and now the CFO of Wal-Mart has confirmed that higher tariffs “will lead to higher prices for customers”

Walmart has said that prices for shoppers will rise due to higher tariffs on goods from China, joining other retailers in warning consumers of cost hikes for imports.

‘Higher tariffs will lead to higher prices for customers,’ Walmart Chief Financial Officer Brett Biggs said on Thursday following the company’s report on its first quarter results.

So what this means is that a hundred dollars will not go nearly as far as it once did when you are shopping at Wal-Mart.

And some of Wal-Mart’s biggest vendors are also sounding the alarm.  For example, just consider what Del Monte CEO Greg Longstreet just said

Also, Walmart’s vendors have started to raise prices, among them Del Monte Foods, which supplies fresh and packaged goods to Walmart, including mandarin oranges imported from China. Prices will go up again with tariffs rising.

‘It´s not just tariffs. Transportation costs are up, labor costs are up. It´s an inflationary environment,’ Del Monte CEO Greg Longstreet told Reuters on the sidelines of a conference. ‘A lot of that’s going to have to be passed on. The consumer is going to have to pay more for a lot of critical goods.’

Unfortunately, Longstreet is 100% correct.

The price of everything is going to go up in the months ahead, and this is particularly true when it comes to food prices.

Meanwhile, the trade war is really starting to hit hard in other parts of the economy as well.  At this point, the largest producer of farm tractors in the world is no longer “cautiously optimistic”

Deere & Co. is no longer “cautiously optimistic” as it has been for so long. The machinery giant reported lower-than-expected earnings and cut its annual guidance as its farmer customers shun major purchases amid uncertainty about demand for their products.

“Ongoing concerns about export-market access, near-term demand for commodities such as soybeans, and a delayed planting season in much of North America are causing farmers to become much more cautious about making major purchases,” Chief Executive Officer Sam Allen said in a statement Friday.

If the U.S. and China are able to come to a trade agreement soon, that would greatly help things.

But at this juncture no new talks have even been scheduled because there really isn’t anything to talk about

Scheduling for the next round of negotiations is “in flux” because it is unclear what the two sides would negotiate, two sources briefed on the status of the talks said. China has not signaled it is willing to revisit past promises on which it reneged earlier this month, despite showing up for talks in Washington last week.

Both sides have dug in on their positions this week. China propped up its currency and cut U.S. pork orders, while state media took on an increasingly nationalistic message. The Trump administration, meanwhile, put Chinese telecommunications company Huawei and its affiliates on a business blacklist and banned it from the supply chain, actions it had shelved earlier in the trade talks to smooth relations.

When President Trump decided to use the “nuclear option” on Chinese telecommunications giant Huawei, that was a major turning point.

At this moment, it would be difficult to overstate how angry the Chinese are at the Trump administration.  The Global Times is a mouthpiece for the Chinese government, and they just published a scathing editorial in which they accused Trump of “a declaration of war on China in the economic and technological fields”.  The following excerpt from that editorial comes from Zero Hedge

Huawei is the symbol of China’s ability to do independent research. As a private company, it is the forerunner of China’s reform and opening-up. It has been deeply engaged in the development of global communications and become the leader of 5G technology. That Huawei will not lose to the US is significant for China’s response to the US’ strategic suppression.

The US has completely abandoned commercial principles and disregarded law. Its barbaric behavior against Huawei by resorting to administrative power can be viewed as a declaration of war on China in the economic and technological fields. It is time that the Chinese people throw away their illusions. Compromise will not lead to US goodwill.

A breakdown in relations with China is part of the long-term scenario that we have been anticipating.  But we had hoped that it would be put off for as long as possible, because what is coming next is going to be very painful.

This isn’t going to be just a trade war.

And in the long run, it isn’t going to be just an “economic war” either.

Unless somebody can pull off a miracle, things between are two nations are likely to start spiraling downhill rather quickly.  As the trade war escalates, the U.S. and China will take turns retaliating back and forth, and the entire globe is going to suffer as a result.

So let us hope for a miracle, because at this point the outlook for the months ahead is definitely quite bleak.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

Here Are 15 Numbers That Show How The Global Economy Is Performing, And All Of Them Are Bad

Global economic activity has already been slowing down dramatically, and the U.S. trade war with China is just going to make things worse.  In so many ways, what we are witnessing in 2019 is quite reminiscent of what we witnessed as the last recession was beginning.  Global exports are absolutely plummeting, auto sales are way down all over the globe, debt delinquencies are way up, and retailers are closing stores at a record pace.  Even if the U.S. and China were getting along, things would be rough for the global economy in the months ahead, but a full-blown trade war between the two largest economies on the entire planet has the potential to be absolutely disastrous.  We are truly in uncharted waters, and many believe that events are going to start accelerating very rapidly now.

Even though I write about this stuff on a daily basis, I have been surprised by how poor the global economic numbers have been lately.

And remember, earlier this month the global media were convinced that the U.S. and China were about to finalize a trade deal.  Now that negotiations have completely broken down, we should expect that these numbers will soon get even worse.

The following are 15 numbers that show how the global economy is currently performing…

#1 Global exports are absolutely crashing and have now fallen to the lowest level since 2009.

#2 U.S. auto dealers are dealing with a backlog of 4.2 million unsold vehicles.

#3 Auto sales in Europe have fallen for seven months in a row.

#4 Chinese auto sales fell a whopping 16.6 percent in the month of April.

#5 Overall, Chinese auto sales have now fallen for 11 months in a row.  That is a new all-time record.

#6 U.S. auto loan delinquencies have reached the highest level since the last recession.

#7 U.S. credit card delinquencies have hit the highest level in eight years.

#8 In April, U.S. manufacturing activity unexpectedly declined 0.5 percent.

#9 Thanks to the trade war, the price of soybeans just dropped to the lowest level since 2008.

#10 Party City just announced that it will be closing 45 stores.

#11 Fred’s just announced that they will be closing 104 more stores.

#12 In April, U.S. retail sales declined for the second time in three months.

#13 According to the Atlanta Fed’s latest forecast, U.S. GDP growth is expected to fall to just 1.2 percent in the second quarter of 2019.

#14 According to a new study just released by the Urban Institute, 40 percent of all Americans “sometimes struggle to afford housing, utilities, food or health care”.

#15 Overall, 59 percent of all Americans are currently living paycheck to paycheck according to a survey that was just conducted by Charles Schwab.

Leaders from both the U.S. and China are trying to act tough and say the right things, but everyone knows that this trade war is going to hurt both countries.

Economic numbers from both nations have been troubling lately, and one expert that was just interviewed by CNBC says that “it could get a lot worse”

Consumer and industrial activity in both the U.S. and China slowed in April, even before the world’s two biggest economies entered the latest phase of an escalating trade war that could take a bite out of global growth.

“The real message today is that both the economic data from the U.S. and China have disappointed. They’re like two boys in the sandbox that are spitting on each other, and it could get a lot worse,” said Marc Chandler, global market strategist at Bannockburn Global Forex.

In the short-term, it would greatly help if the U.S. and China could find a way to agree to a trade deal.

Unfortunately, the events of the past 48 hours have made that a lot less likely.

As I discussed yesterday, President Trump essentially took a sledgehammer to Chinese telecommunications giant Huawei.  When the Commerce Department put Huawei on the “Entity List”, it essentially banned the company from buying much needed parts and components from U.S. firms.  Some have described this as “the nuclear option”, and I think that description is quite accurate.  In the end, this move is going to be absolutely devastating for Huawei.

Of course the Chinese are absolutely furious about this.  Huawei is viewed with great national pride in China, and this move is considered to be a direct insult to Chinese national honor.  Most Americans are not paying too much attention to the details of the trade war, but in China this is a really big deal and people are extremely angry.  In fact, there has apparently been a run on “Donald Trump toilet brushes” in China in recent days because the Chinese are so angry.

Following my recent article about Huawei, a number of readers complained that I was being too soft on China.  Of course that is not true at all.  Long before Donald Trump ran for president, I was writing about how China was lying, cheating, stealing our technology and robbing us blind.  I was literally begging for our politicians to stand up and do something, and I was thrilled when Trump started talking tough about China because I knew that he really understood these issues.

But I also want everyone to understand that trying to decouple from the Chinese economy would be extremely painful even in the most optimistic scenario.  Our two economies have become extremely integrated, and we have become very dependent on China in many different ways.  They buy our soybeans, they provide us with rare earth elements, and they own more than a trillion dollars of our debt.  Looking at it from the Chinese perspective, they have countless ways that they can hurt us, and the angrier we make them the more likely it will be that they will lash out at us.

When negotiating with China, you need to be tough but you also need a lot of finesse.  Taking a baseball bat and slamming it into their kneecaps is not going to work.

If we destroy our relationship with China, that is going to result in us going down a very dark path.  Yes, China is an evil empire that has no respect for human rights at all.  There is no freedom of speech in China, over the past year they have been shutting down lots of churches and burning lots of Bibles, and they have been systematically throwing members of other religious minorities into concentration camps.

So I don’t have any sympathy for the communist Chinese government at all.  I just want all of you to understand that they are a very dangerous adversary, and a protracted trade war could be truly disastrous for the entire global economy.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

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