Are We On The Verge Of Witnessing The Death Of The Paper Gold Scam?

Gold BarsThe legal claims on physical gold far exceed the amount of physical gold that the banks actually have by a very, very wide margin.  And right now the bankers are scared out of their wits because their warehouses are being drained of physical gold at a frightening rate.  So what happens when their physical gold is gone but they still have lots and lots of people with legal claims to gold?  When that moment arrives, it will represent the end of the paper gold scam.  Many believe that the recent takedown of the price of paper gold was a desperate attempt by the bankers to put off that day of reckoning, but it appears to have greatly backfired on them.  Instead of cooling off demand for precious metals, it has unleashed a massive “gold rush” all over the globe.  Meanwhile, word has been spreading among wealthy families in both North America and Europe that they had better grab their physical gold out of the banks while they still can.  This is creating havoc in the financial community, and at least one major international bank has already declared that it will only be settling those accounts in cash from now on.  The paper gold scam is starting to unravel, and by the time this is all over it is going to be a complete and total nightmare for global financial markets.

For years it has been widely known that the promises that banks have made regarding their gold far exceed their actual ability to deliver, but we have never reached a moment of such crisis before.

Posted below are quotes from people that know precious metals far better than I do.  What these experts are saying is more than a little bit disturbing…

CME President Terry Duffy: What’s interesting about gold, when we had that big break two weeks ago we saw all the gold stocks trade down significantly, we saw all the gold products trade down significantly, but one thing that did not trade down, was gold coins, tangible real gold. That’s going to show you, people don’t want certificates, they don’t want anything else. They want the real product.

Billionaire Eric Sprott: So we see all of these paper (trading) volumes going through that bear absolutely no relationship to what’s going on in the physical markets. As you know I have always been a proponent of the fact that supply in the gold market was way less than demand, and by a very large factor. I think demand exceeds supply by at least 60%. The central banks are surreptitiously supplying that gold, and ultimately they will be running on fumes.

When we hear about the LBMA not willing to deliver gold, and JP Morgan’s inventories at the COMEX have gone from 2.4 million (ounces) down to 160,000 ounces, it just makes you realize that all of this paper trading means nothing. It’s the real physical market that you have to rely on.

JS Kim: FACT #1: COMEX gold vaults were recently drained of 2 million ounces of physical gold in one quarter, the largest withdrawal of physical gold bullion from COMEX vaults in one quarter during this entire 12-year gold and silver bull. There has been speculation about the reasons that spurred these massive withdrawals of gold from COMEX vaults, but the most reasonable speculation is that no one trusts the bankers to hold on to their physical gold anymore, especially in light of Fact #2. Note below, that both registered AND eligible stocks of gold had heavily declined in recent months. Such an event signals a general distrust of the banking system from everyone holding gold in registered COMEX vaults.

FACT #2: One of the largest European banks, ABN Amro, defaulted on their gold contracts and informed their clients that they would only settle their gold bullion contracts in cash and not in physical. So much for the supposed legality of financial contracts as a “binding” contract. So whether Fact #1 caused Fact #2 or vice versa is irrelevant. What IS apparent is that the level of trust in bankers to safekeep physical gold and physical silver is disappearing, as it should be, and as it should have already been for years now. But truth always takes some time to catch up to banker spread lies and that is what is happening now. I have been warning people never to trust bankers in deals involving gold and silver for years now, as in this article I wrote nearly four years ago informing the public that the SLV and GLD are likely a banker invented scam as well.

FACT #3: Silver fraud whistleblower and London trader Andrew Maguire stated that the LBMA was having trouble settling gold contracts in bullion as well and stated that institutions that asked for physical settlement “were told they would be cash settled instead by a bullion bank.” In plain English, this is a default. So Andrew Maguire reported that the LBMA had already gone into default. In light of Fact #1 and Fact #2, the dominoes were starting to tumble and the house of cards that the bankers had built in gold and silver paper derivatives to deceive and hide the true fundamentals of the physical gold and physical markets from the entire world was rapidly starting to crumble. A financial earthquake of magnitude 2.5 was quickly threatening to evolve into one of the biggest financial earthquakes of all time in which the world’s confidence in all global fiat currencies would effectively have a well-deserved funeral.

Jim Sinclair: I think the reality is the supply situation is extremely volatile at this point, and even discussing it is like rubbing a raw nerve to the people who are in charge. The amount of discussion on the subject of warehouse supply, supply that is represented by the gold leases, indicated to the central planners that the demand for physical was going to continue to effect the exchanges.

Although they did not expect any grandstand delivery, the mere continued draining of physical inventories was threatening the very functioning of the paper exchange. That threatening of the paper exchange and its ability to continue functioning is really taking off the blinders and revealing the truth behind the critical question, ‘Where is the gold?’

The question now is, ‘Where has the gold gone?’ Who has all of this gold? Because of the nature of gold leasing, all of this gold has been purchased and it has gone somewhere. The reality of the empty vaults reveal that the gold has gone missing.

Ronald Stoeferle: We’re seeing this rush to physical gold not only in the retail market, but also for the institutional players…[it’s] just overwhelming…I [estimate] a 130-to-1 [ratio of paper to physical gold]…and I think in the last week we were really close to [triggering] a default of the paper market.

Gerhard Schubert, head of Precious Metals at Emirates NBD: I have not seen in my 35 years in precious metals such a determined and strong global physical demand for gold. The UAE physical markets have been cleared out by buyers from all walks of life. The premiums, which have been asked for and which have been paid have been the cornerstone of the gold price recovery. It is very rare that physical markets can have a serious impact on market prices, which are normally driven solely by derivatives and futures contracts…

I did speak during the week with several refineries in the world, of course including the UAE refineries, and the waiting period for 995 kilo bars is easily 2-3 weeks and goes into June in some cases. A large portion of the 995 kilo bars in the UAE goes normally into the Indian market, but a lot of the available 995 kilo bars are destined for Turkey, at this time. We heard that premiums paid in Turkey have reached anything between US $ 20 and US $ 35 per ounce.

James Turk: Another indication of the demand for large bars is the huge drawdown in the gold stock in COMEX warehouses. It is noteworthy that COMEX reports show the drawdown is largely the result of dealers removing their inventory, their working stock. When that happens, you know the availability of supply is constrained.

What all of this means, Eric, is one thing. If the central planners want to keep the precious metals at these low prices, to meet the demand for physical metal they will need to empty more metal from central bank vaults, or borrow metal from the ETFs as some have suggested is happening. Otherwise, the central planners will have to step back and stop their intervention, thereby letting the price of gold and silver rise so that demand tapers off, bringing demand and supply of physical metal back toward some kind of balance.

We’ve seen this same situation several times over the last twelve years. It is what I have been calling a “managed retreat.” Despite the current weakness, I firmly believe we have again entered a critical period where the central planners will need to retreat once again in order to let the gold and silver prices climb higher.

The Golden Truth: And then I get a call from a close friend in NYC last Friday.   His career has been in private wealth management in the private bank department of the Too Big To Fail banks.  He’s been looking for work and chats with old colleagues all the time.  He called my Friday and told me he just got off the phone with a very high level private banker from a big Euro-based TBTF bullion bank, but who was at JP Morgan until about six months ago.

This guy told my friend that there is a scramble by many very wealthy European families/entities to get their 400 oz bars out of the big bank vaults. He knows this personally, for a fact.  He said the private banker community is small over there and the big wealthy families all talk to each other and act on the same rumors/sentiment.  The Bundesbank/Fed and the ABN/Amro situations triggered this move.  He knows for a fact JPM tried to calm fears about 3 months ago by sending a letter to it’s very wealthy clients assuring them their bars were safe, in allocated accounts.  He said right now those same families are walking into the big banks like JPM and demanding delivery of their bars or threatening to take their $100’s of millions in investment portfolios to competitors.  His wording was “these people are putting a gun to the heads of private banks and demanding their gold.”

I know this information is good because I know my friend’s background and when he tells me his source is plugged in, the guy is plugged in. Not only that, my friend’s source said that there’s no doubt that someone like a John Paulson, not necessarily specifically him, but entities like him or it may include him, have held a gun to GLD and demanded delivery of physical in exchange for their shares.

Regarding the Bundesbank/Fed situation, recall that the Bundesbank asked to have some portion of its gold sitting – supposedly – in the NY Fed vault in NYC sent back Germany. The total amount is 1800 tonnes.  After behind the scenes negotiations, the Fed agreed to ship 300 tonnes back over seven years.  To this day, the time required for that shipment has never been explained.  Venezuela demanded the return of its 200 tonnes held in London, NYC and Switzerland and received it all within about four months.

And regarding the ABN/Amro situation.  ABN/Amro offered a gold investment account product that offered physical delivery of the gold in the investment account when the investor cashes out.  About a week before the gold price smash, ABN sent a letter to its clients informing that the physical delivery of the bullion was no longer available and that all accounts would be settled with cash at redemption.

I believe it was these two events that triggered the big scramble for physical gold by wealthy families/entities who were suspicious of the integrity of their bank vault custodial arrangement anyway.

*****

So what does all of this mean?

It means that we are entering a period when there will be unprecedented volatility for precious metals.  There will be tremendous ups and downs as this crisis plays out and the bankers try to keep the paper gold scam from completely unraveling.

Meanwhile, nations such as China continue to stockpile gold as if the end of the world was coming.

According to Zero Hedge, Chinese gold imports set a brand new all-time record high in March…

Quite the contrary: as export data released by the Hong Kong Census and Statistics Department overnight showed, Chinese gold imports in March exploded to an all time record high of 223.5 tons.

And the number for April is expected to be even higher.

Does China know something that the rest of us do not?

We are also seeing a rapid decoupling between spot prices and physical prices.  In fact, it is quickly getting to the point where the spot price of gold and the spot price of silver are becoming irrelevant.

For example, demand for silver coins has become so intense that some dealers are charging premiums of up to 30 percent over spot price for silver eagles.

That would have been regarded as insane a few years ago, but people are now willing to pay these kinds of premiums.  People are recognizing the importance of actually having physical gold and silver in their possession and they are willing to pay a significant premium in order to get it.

We are moving into uncharted territory.  The paper gold scam is rapidly coming to an end.  In the long-term, this will greatly benefit those that are holding significant amounts of physical gold and silver.

The Beginning Of The End by Michael Snyder

The Coming Derivatives Panic That Will Destroy Global Financial Markets

When financial markets in the United States crash, so does the U.S. economy.  Just remember what happened back in 2008.  The financial markets crashed, the credit markets froze up, and suddenly the economy went into cardiac arrest.  Well, there are very few things that could cause the financial markets to crash harder or farther than a derivatives panic.  Sadly, most Americans don’t even understand what derivatives are.  Unlike stocks and bonds, a derivative is not an investment in anything real.  Rather, a derivative is a legal bet on the future value or performance of something else.  Just like you can go to Las Vegas and bet on who will win the football games this weekend, bankers on Wall Street make trillions of dollars of bets about how interest rates will perform in the future and about what credit instruments are likely to default.  Wall Street has been transformed into a gigantic casino where people are betting on just about anything that you can imagine.  This works fine as long as there are not any wild swings in the economy and risk is managed with strict discipline, but as we have seen, there have been times when derivatives have caused massive problems in recent years.  For example, do you know why the largest insurance company in the world, AIG, crashed back in 2008 and required a government bailout?  It was because of derivatives.  Bad derivatives trades also caused the failure of MF Global, and the 6 billion dollar loss that JPMorgan Chase recently suffered because of derivatives made headlines all over the globe.  But all of those incidents were just warm up acts for the coming derivatives panic that will destroy global financial markets.  The largest casino in the history of the world is going to go “bust” and the economic fallout from the financial crash that will happen as a result will be absolutely horrific.

There is a reason why Warren Buffett once referred to derivatives as “financial weapons of mass destruction”.  Nobody really knows the total value of all the derivatives that are floating around out there, but estimates place the notional value of the global derivatives market anywhere from 600 trillion dollars all the way up to 1.5 quadrillion dollars.

Keep in mind that global GDP is somewhere around 70 trillion dollars for an entire year.  So we are talking about an amount of money that is absolutely mind blowing.

So who is buying and selling all of these derivatives?

Well, would it surprise you to learn that it is mostly the biggest banks?

According to the federal government, four very large U.S. banks “represent 93% of the total banking industry notional amounts and 81% of industry net current credit exposure.”

These four banks have an overwhelming share of the derivatives market in the United States.  You might not be very fond of “the too big to fail banks“, but keep in mind that if a derivatives crisis were to cause them to crash and burn it would almost certainly cause the entire U.S. economy to crash and burn.  Just remember what we saw back in 2008.  What is coming is going to be even worse.

It would have been really nice if we had not allowed these banks to get so large and if we had not allowed them to make trillions of dollars of reckless bets.  But we stood aside and let it happen.  Now these banks are so important to our economic system that their destruction would also destroy the U.S. economy.  It is kind of like when cancer becomes so advanced that killing the cancer would also kill the patient.  That is essentially the situation that we are facing with these banks.

It would be hard to overstate the recklessness of these banks.  The numbers that you are about to see are absolutely jaw-dropping.  According to the Comptroller of the Currency, four of the largest U.S. banks are walking a tightrope of risk, leverage and debt when it comes to derivatives.  Just check out how exposed they are…

JPMorgan Chase

Total Assets: $1,812,837,000,000 (just over 1.8 trillion dollars)

Total Exposure To Derivatives: $69,238,349,000,000 (more than 69 trillion dollars)

Citibank

Total Assets: $1,347,841,000,000 (a bit more than 1.3 trillion dollars)

Total Exposure To Derivatives: $52,150,970,000,000 (more than 52 trillion dollars)

Bank Of America

Total Assets: $1,445,093,000,000 (a bit more than 1.4 trillion dollars)

Total Exposure To Derivatives: $44,405,372,000,000 (more than 44 trillion dollars)

Goldman Sachs

Total Assets: $114,693,000,000 (a bit more than 114 billion dollars – yes, you read that correctly)

Total Exposure To Derivatives: $41,580,395,000,000 (more than 41 trillion dollars)

That means that the total exposure that Goldman Sachs has to derivatives contracts is more than 362 times greater than their total assets.

To get a better idea of the massive amounts of money that we are talking about, just check out this excellent infographic.

How in the world could we let this happen?

And what is our financial system going to look like when this pyramid of risk comes falling down?

Our politicians put in a few new rules for derivatives, but as usual they only made things even worse.

According to Nasdaq.com, beginning next year new regulations will require derivatives traders to put up trillions of dollars to satisfy new margin requirements.

Swaps that will be allowed to remain outside clearinghouses when new rules take effect in 2013 will require traders to post $1.7 trillion to $10.2 trillion in margin, according to a report by an industry group.

The analysis from the International Swaps and Derivatives Association, using data sent in anonymously by banks, says the trillions of dollars in cash or securities will be needed in the form of so-called “initial margin.” Margin is the collateral that traders need to put up to back their positions, and initial margin is money backing trades on day one, as opposed to variation margin posted over the life of a trade as it fluctuates in value.

So where in the world will all of this money come from?

Total U.S. GDP was just a shade over 15 trillion dollars last year.

Could these rules cause a sudden mass exodus that would destabilize the marketplace?

Let’s hope not.

But things are definitely changing.  According to Reuters, some of the big banks are actually urging their clients to avoid new U.S. rules by funneling trades through the overseas divisions of their banks…

Wall Street banks are looking to help offshore clients sidestep new U.S. rules designed to safeguard the world’s $640 trillion over-the-counter derivatives market, taking advantage of an exemption that risks undermining U.S. regulators’ efforts.

U.S. banks such as Morgan Stanley (MS.N) and Goldman Sachs (GS.N) have been explaining to their foreign customers that they can for now avoid the new rules, due to take effect next month, by routing trades via the banks’ overseas units, according to industry sources and presentation materials obtained by Reuters.

Unfortunately, no matter how banks respond to the new rules, it isn’t going to prevent the coming derivatives panic.  At some point the music is going to stop and some big financial players are going to be completely and totally exposed.

When that happens, it might not be just the big banks that lose money.  Just take a look at what happened with MF Global.

MF Global has confessed that it “diverted money” from customer accounts that were supposed to be segregated.  A lot of customers may never get back any of the money that they invested with those crooks.  The following comes from a Huffington Post article about the MF Global debacle, and it might just be a preview of what other investors will go through in the future when a derivatives crash destroys the firms that they had their money parked with…

Last week when customers asked for excess cash from their accounts, MF Global stalled. According to a commodity fund manager I spoke with, MF Global’s first stall tactic was to claim it lost wire transfer instructions. Then instead of sending an overnight check, it sent the money snail mail, including checks for hundreds of thousands of dollars. The checks bounced. After the checks bounced, the amounts were still debited from customer accounts and no one at MF Global could or would reverse the check entries. The manager has had to intervene to get MF Global to correct this.

How would you respond if your investment account suddenly went to “zero” because the firm you were investing with “diverted” customer funds for company use and now you have no way of recovering your money?

Keep an eye on the large Wall Street banks.  In a previous article, I quoted a New York Times article entitled “A Secretive Banking Elite Rules Trading in Derivatives” which described how these banks dominate the trading of derivatives…

On the third Wednesday of every month, the nine members of an elite Wall Street society gather in Midtown Manhattan.

The men share a common goal: to protect the interests of big banks in the vast market for derivatives, one of the most profitable — and controversial — fields in finance. They also share a common secret: The details of their meetings, even their identities, have been strictly confidential.

According to the article, the following large banks are represented at these meetings: JPMorgan Chase, Goldman Sachs, Morgan Stanley, Bank of America and Citigroup.

When the casino finally goes “bust”, you will know who to blame.

Without a doubt, a derivatives panic is coming.

It will cause the financial markets to crash.

Several of the “too big to fail” banks will likely crash and burn and require bailouts.

As a result of all this, credit markets will become paralyzed by fear and freeze up.

Once again, we will see the U.S. economy go into cardiac arrest, only this time it will not be so easy to fix.

Do you agree with this analysis, or do you find it overly pessimistic?  Please feel free to post a comment with your thoughts below…

55 Reasons Why You Should Buy Products That Are Made In America

This is the time of the year when Americans run out to their favorite retail stores and fill up their shopping carts with lots of cheap plastic crap made by workers in foreign countries where it is legal to pay slave labor wages.  By doing this, the American people are actively participating in the destruction of the U.S. economy.  You see, buying products that are made in America is not just a matter of national pride.  It is a matter of national survival.  If we do not support American workers, they are going to continue to see their jobs shipped out of the country.  If we do not support American businesses, they are going to continue to die off at a staggering rate.  Last year, the United States had a trade deficit with the rest of the world of 558 billion dollars.  More than half a trillion dollars that could have gone into the pockets of U.S. workers and U.S. businesses went overseas instead.  If that money had stayed in the country, taxes would have been paid on that mountain of cash and our local, state and federal government debt problems would not be as severe.  As a result of our massive trade imbalance, we have lost tens of thousands of businesses, millions of jobs and trillions of dollars of national wealth.  Both major political parties have sold us out on these issues, and we are getting poorer as a nation with each passing day.  We desperately need a resurgence of economic patriotism in the United States before it is too late.

Yes, I know that it is very tempting to buy foreign-made products.  After all, they are almost always cheaper.

But most people don’t often think about why they are cheaper.

Unfortunately, in the name of “free trade” American workers have been merged into a global labor pool where they have to compete directly for jobs with workers on the other side of the globe that live in countries where it is legal to pay slave labor wages.  This makes employing American workers a tremendous liability.

If a company hires you and pays you 10 to 15 dollars an hour with benefits, how is it going to compete with another company that pays workers a dollar an hour with no benefits on the other side of the planet?

Both major political parties are pushing this emerging “one world economic system“, but it is absolutely killing American jobs.  We have already seen a mass exodus of jobs and businesses out of this country, and wages for the jobs that remain in the United States are being forced down because there are hordes of unemployed workers that are willing to take just about any decent job they can find.

It has become painfully obvious that our politicians are not going to do anything to help us on these issues, so what we need is a mass awakening among the American people.

We need to educate people that buying things that are made in America is good for the economy and that buying things that are made elsewhere is bad for the economy.

But for now, most Americans are clueless.  They will line up on Black Friday morning and trample one another in a desperate attempt to save a few bucks on cheap plastic devices that were made on the other side of the planet.

And they will pay for much of this “shopping” with credit cards.

Credit card debt is on the rise once again.  In fact, average credit card debt per borrower was 4.9 percent higher in the third quarter of 2012 than it was in the third quarter of 2011.  It looks like most of us didn’t learn our lessons from the last financial crisis.

But not all Americans enjoy the shopping that is typically involved with this time of the year.  One recent survey found that approximately 45 percent of all Americans think that there is so much financial pressure associated with the holidays that they wouldn’t mind skipping them completely.

That same poll found that approximately 41 percent of all Americans would only be able to survive for two weeks without a paycheck.  Many Americans are up to their eyeballs in debt, their incomes are not keeping up with rising prices, and they find themselves scratching and clawing just to make it from month to month.

Meanwhile, we continue to destroy our own jobs and businesses by spending our money on products that have been made outside the country.

The following are 55 reasons why you should buy products that are made in America this holiday season…

1. When you buy products that are made in America you support American workers.

2. When you buy products that are made in America you support companies that are doing business in America.

3. In 2000, there were more than 17 million Americans working in manufacturing, but now there are less than 12 million.

4. The United States has a trade imbalance that is more than 7 times larger than any other nation on earth has.

5. Our trade deficit with China in 2011 was $295.5 billion.  That was the largest trade deficit that one country has had with another country in the history of the planet.

6. In 2011, our trade deficit with China was 28 times larger than it was back in 1990 and more than 49,000 times larger than it was back in 1985.

7. When NAFTA was passed in 1993, the United States had a trade surplus with Mexico of 1.6 billion dollars.  In 2010, we had a trade deficit with Mexico of 61.6 billion dollars.

8. One professor has estimated that cutting the U.S. trade deficit in half would create 5 million more jobs in the United States.

9. Overall, the United States has run a trade deficit of more than 8 trillion dollars with the rest of the globe since 1975.  That 8 trillion dollars could have gone to support U.S. businesses and pay the wages of U.S. workers.  Federal, state and local taxes would also have been paid on that 8 trillion dollars if it had stayed in the United States.

10. According to the Economic Policy Institute, America is losing half a million jobs to China every single year.

11. The United States has lost an average of approximately 50,000 manufacturing jobs a month since China joined the World Trade Organization in 2001.

12. According to U.S. Representative Betty Sutton, the United States has lost an average of 15 manufacturing facilities a day over the last 10 years.

13. During 2010 alone, an average of 23 manufacturing facilities permanently shut down in the United States every single day.

14. Overall, the United States has lost more than 56,000 manufacturing facilities since 2001.

15. The United States has lost a staggering 32 percent of its manufacturing jobs since the year 2000.

16. Between December 2000 and December 2010, 38 percent of the manufacturing jobs in Ohio were lost, 42 percent of the manufacturing jobs in North Carolina were lost and 48 percent of the manufacturing jobs in Michigan were lost.

17. As I have written about previously, 95 percent of the jobs lost during the last recession were middle class jobs.

18. Due in part to the globalization of the labor pool, only about 24 percent of all jobs in the United States are “good jobs” at this point.

19. Right now, more than 41 percent of all working age Americans do not have a job, and the vast majority of the new jobs that are being created are low paying jobs.

20. The United States now has 10 percent fewer “middle class jobs” than it did just ten years ago.

21. According to the Economic Policy Institute, the U.S. economy loses approximately 9,000 jobs for every $1 billion of goods that are imported from overseas.

22. As our economic infrastructure is gutted, formerly great manufacturing cities all over America are being transformed into festering hellholes.

23. Between 2001 and 2007, the value of products that Wal-Mart imported from China grew from $9 billion to $27 billion.

24. In 2001, American consumers spent 102 billion dollars on products made in China.  In 2011, American consumers spent 399 billion dollars on products made in China.

25. The United States spends about 4 dollars on goods and services from China for every one dollar that China spends on goods and services from the United States.

26. Back in 1998, the United States had 25 percent of the world’s high-tech export market and China had just 10 percent. Today, China’s high-tech exports are more than twice the size of U.S. high-tech exports.

27. In 2002, the United States had a trade deficit in “advanced technology products” of $16 billion with the rest of the world.  In 2010, that number skyrocketed to $82 billion.

28. The United States has lost more than a quarter of all of its high-tech manufacturing jobs over the past ten years.

29. Manufacturing employment in the U.S. computer industry was actually lower in 2010 than it was in 1975.

30. The Chinese undervalue their currency by about 40 percent in order to gain a critical advantage over foreign competitors.  This means that many Chinese companies are able to absolutely thrive while their competition in the United States goes out of business.

31. According to the New York Times, a Jeep Grand Cherokee that costs $27,490 in the United States costs about $85,000 in China thanks to all the tariffs.

32. In 2010, China produced more than twice as many automobiles as the United States did.

33. Since the auto industry bailout, approximately 70 percent of all GM vehicles have been built outside the United States.

34. Do you remember when the United States was the dominant manufacturer of automobiles and trucks on the globe?  Well, in 2010 the U.S. ran a trade deficit in automobiles, trucks and parts of $110 billion.

35. In 2010, South Korea exported 12 times as many automobiles, trucks and parts to us as we exported to them.

36. In 2010, China produced 627 million metric tons of steel.  The United States only produced 80 million metric tons of steel.

37. In 2010, China produced 7.3 million metric tons of cotton.  The United States only produced 3.4 million metric tons of cotton.

38. Today, China produces nearly twice as much beer as the United States does.

39. 85 percent of all artificial Christmas trees are made in China.

40. Right now, China is producing more than three times as much coal as the United States does.

41. China is now the number one supplier of components that are critical to the operation of U.S. defense systems.  How stupid can we possibly be?

42. According to author Clyde Prestowitz, China’s number one export to the U.S. is computer equipment.  According to an article in U.S. News & World Report, during 2010 the number one U.S. export to China was “scrap and trash”.

43. All over the United States, road and bridge projects are being outsourced to Chinese firms.  Just check out the following excerpt from a recent ABC News article….

In New York there is a $400 million renovation project on the Alexander Hamilton Bridge.

In California, there is a $7.2 billion project to rebuild the Bay Bridge connecting San Francisco and Oakland.

In Alaska, there is a proposal for a $190 million bridge project.

These projects sound like steps in the right direction, but much of the work is going to Chinese government-owned firms.

“When we subsidize jobs in China, we’re not creating any wealth in the United States,” said Scott Paul, executive director for the Alliance for American Manufacturing.

44. The new World Trade Center tower is going to include glass that has been imported from China.

45. The new Martin Luther King memorial on the National Mall was made in China.

46. The Chinese economy has grown 7 times faster than the U.S. economy has over the past decade.

47. The Chinese economy is projected to be larger than the U.S. economy by 2016.

48. One economist is projecting that the Chinese economy will be three times larger than the U.S. economy by the year 2040.

49. In recent years the U.S. economy has embraced “free trade” and the emerging one world economy like never before.  Instead of increasing the number of jobs in our economy, it has resulted in the worst stretch of job creation in the United States in modern history….

If any single number captures the state of the American economy over the last decade, it is zero. That was the net gain in jobs between 1999 and 2009—nada, nil, zip. By painful contrast, from the 1940s through the 1990s, recessions came and went, but no decade ended without at least a 20 percent increase in the number of jobs.

50. If you gathered together all of the workers that are “officially” unemployed in the United States today, they would constitute the 68th largest country in the world.

51. China now holds approximately more than a trillion dollars of U.S. government debt.  If you were alive back when Jesus was born and you had spent a million dollars every single day since then, you still would not have spent that much money by now.

52. Jeffrey Immelt, the head of Barack Obama’s highly touted “Jobs Council”, has shipped tens of thousands of good jobs out of the United States.

53. Without enough good jobs, more Americans than ever before are falling into poverty.  Today, more than 100 million Americans are enrolled in at least one welfare program run by the federal government.

54. According to Professor Alan Blinder of Princeton University, 40 million more U.S. jobs could be sent offshore over the next two decades if current trends continue.

55. If U.S. consumers do not start supporting U.S. workers and U.S. businesses, eventually we will all be so poor that very few of us will be able to afford to buy any gifts during the holiday season.

Feeding The Homeless BANNED In Major Cities All Over America

What would you do if you came across someone on the street that had not had anything to eat for several days?  Would you give that person some food?  Well, the next time you get that impulse you might want to check if it is still legal to feed the homeless where you live.  Sadly, feeding the homeless has been banned in major cities all over America.  Other cities that have not banned it outright have put so many requirements on those that want to feed the homeless (acquiring expensive permits, taking food preparation courses, etc.) that feeding the homeless has become “out of reach” for most average people.  Some cities are doing these things because they are concerned about the “health risks” of the food being distributed by ordinary “do-gooders”.  Other cities are passing these laws because they do not want homeless people congregating in city centers where they know that they will be fed.  But at a time when poverty and government dependence are soaring to unprecedented levels, is it really a good idea to ban people from helping those that are hurting?

This is just another example that shows that our country is being taken over by control freaks.  There seems to be this idea out there that it is the job of the government to take care of everyone and that nobody else should even try.

But do we really want to have a nation where you have to get the permission of the government before you do good to your fellow man?

It isn’t as if the government has “rescued” these homeless people.  Homeless shelters all over the nation are turning people away each night because they have no more room.  There are many homeless people that are lucky just to make it through each night alive during the winter.

Sometimes a well-timed sandwich or a cup of warm soup can make a world of difference for a homeless person.  But many U.S. cities have decided that feeding the homeless is such a threat that they had better devote law enforcement resources to making sure that it doesn’t happen.

This is so twisted.  In America today, you need a “permit” to do almost anything.  We are supposed to be a land of liberty and freedom, but these days government bureaucrats have turned our rights into “privileges” that they can revoke at any time.

The following are some of the major U.S. cities that have attempted to ban feeding the homeless….

Philadelphia

Mayor Nutter recently banned feeding homeless people in many parts of Philadelphia where homeless people are known to congregate….

Philadelphia Mayor Michael Nutter has announced a ban on the feeding of large numbers of homeless and hungry people at sites on and near the Benjamin Franklin Parkway.

Mayor Nutter is imposing the ban on all outdoor feedings of large numbers of people on city parkland, including Love Park and the Ben Franklin Parkway, where it is not uncommon for outreach groups to offer free food.

Nutter says the feedings lack both sanitary conditions and dignity.

Orlando

Last June, a group of activists down in Orlando, Florida were arrested by police for feeding the homeless in defiance of a city ordinance….

Over the past week, twelve members of food activist group Food Not Bombs have been arrested in Orlando for giving free food to groups of homeless people in a downtown park. They were acting in defiance of a controversial city ordinance that mandates permits for groups distributing food to large groups in parks within two miles of City Hall. Each group is allowed only two permits per park per year; Food Not Bombs has already exceeded their limit. They set up their meatless buffet in Lake Eola knowing that they would likely be arrested as a result.

Houston

Down in Houston, a group of Christians was recently banned from distributing food to the homeless, and they were told that they probably would not be granted a permit to do so in the future even if they applied for one….

Bobby and Amanda Herring spent more than a year providing food to homeless people in downtown Houston every day. They fed them, left behind no trash and doled out warm meals peacefully without a single crime being committed, Bobby Herring said.

That ended two weeks ago when the city shut down their “Feed a Friend” effort for lack of a permit. And city officials say the couple most likely will not be able to obtain one.

“We don’t really know what they want, we just think that they don’t want us down there feeding people,” said Bobby Herring, a Christian rapper who goes by the stage name Tre9.

Dallas

Dallas has also adopted a law which greatly restricts the ability of individuals and ministries to feed the homeless….

A Dallas-area ministry is suing the city over a food ordinance that restricts the group from giving meals to the homeless.

Courts dismissed Dallas’ request for a summary judgment last week, saying the case, brought up by pastor Don Hart (in video above) may indeed be a violation of free exercise of religion, as protected by the Texas Religious Freedom Restoration Act, the blog Religion Clause reported.

In the court filing, the ministry leaders argue that their Christian faith requires them to share meals with the homeless (Jesus did!) and that the requirement that even churches and charities provide toilets, sinks, trained staff and consent of the city keeps them from doing so.

Las Vegas

A few years ago, Las Vegas became the first major U.S. city to specifically pass a law banning the feeding of homeless people….

Las Vegas, whose homeless population has doubled in the past decade to about 12,000 people in and around the city, joins several other cities across the country that have adopted or considered ordinances limiting the distribution of charitable meals in parks. Most have restricted the time and place of such handouts, hoping to discourage homeless people from congregating and, in the view of officials, ruining efforts to beautify downtowns and neighborhoods.

But the Las Vegas ordinance is believed to be the first to explicitly make it an offense to feed “the indigent.”

That law has since been blocked by a federal judge, and since then many U.S. cities have been very careful not to mention “the indigent” or “the homeless” by name in the laws they pass that are intended to ban feeding the homeless.

New York City

New York City has banned all food donations to government-run homeless shelters because the bureaucrats there are concerned that the donated food will not be “nutritious” enough.

Yes, this is really true.

The following is from a recent Fox News article….

The Bloomberg administration is now taking the term “food police” to new depths, blocking food donations to all government-run facilities that serve the city’s homeless.

In conjunction with a mayoral task force and the Health Department, the Department of Homeless Services recently started enforcing new nutritional rules for food served at city shelters. Since DHS can’t assess the nutritional content of donated food, shelters have to turn away good Samaritans.

Can you believe that?

The bureaucrats are officially out of control.

In America today, it seems like almost everything is illegal.

One church down in Louisiana was recently ordered to stop giving out water because it did not have a government permit.

Well, I don’t know about you, but I sure am going to give a cup of cold water to someone if they need it whether I have a permit or not.

It is as if common sense has totally gone out the window in this nation.

Over in New Hampshire, a woman is being sued for planting flowers in her own front yard.

This is the kind of thing that makes me glad that I have moved to a much more rural location.  People in the country tend to be much more relaxed.

Sadly, those that love to micro-manage others continue to get the upper hand in America.  Back in January, 40,000 new laws went into effect all over America.  The politicians continue to hit us with wave after wave of regulations and laws with no end in sight.

All of this is making America a very unpleasant place in which to live.

8 Reasons Why The Greek Debt Deal May Not Stop A Chaotic Greek Debt Default

The global financial system is not a game of checkers.  It is a game of chess.  All over the world today, news headlines are proclaiming that this new Greek debt deal has completely eliminated the possibility of a chaotic Greek debt default.  Unfortunately, that is simply not the case.  Rather, the truth is that this new deal actually “sets the table” for a Greek debt default.  When I was studying and working in the legal arena, I learned that sometimes you make an agreement so that you can get the other side to break it.  That may sound very strange to the average person on the street, but this is how the game is played at the highest levels.  It is all about strategy.  And in this case, the new debt deal imposes such strict conditions on Greece that it is almost inevitable that Greece will fail to meet some of them.  When Greece does fail, Germany and the other northern European nations may try to claim that they “did everything that they could” but that Greece just did not “live up to its obligations”.  So does this mean that we will definitely see a chaotic Greek debt default?  No.  What this does mean is that the chess pieces are being moved into position for one.

The following are 8 reasons why the Greek debt deal may not stop a chaotic Greek debt default….

#1 Greece Is Being Set Up To Fail

The terms of this new debt deal impose some incredibly harsh austerity measures on Greece and from now on the Greek government will be subject to “permanent monitoring” by EU officials.

In other words, they will be under a microscope.

Any violation of the terms of the debt deal could be used as a pretext to bring down the hammer and cut off bailout funds.  Potentially, this could even happen just a few weeks from now.

It has become obvious that there are many politicians in Europe that would very much like to kick Greece out of the euro.  In a recent column, the International Business Editor of The Telegraph summed up the situation this way….

It is clear that Berlin, Helsinki, and the Hague have taken the decision to eject Greece from the euro whatever the country now does. Even if Greece complies to the letter with the impossible terms of the EU-IMF Troika, it will not make any difference. A fresh pretext will be found.

#2 The Next Greek Election Could Bring An End To The Bailout Deal Overnight

The next national Greek elections are scheduled for April.  Political parties opposed to the bailout have been surging in recent polls.  It is becoming increasingly likely that the next Greek government will abandon this new deal entirely.

The following is what hedge fund manager Dennis Gartman told CNBC about what is likely to happen after the next elections….

“A new government is going to come to power following elections that shall take place sometime this spring, and if anyone anywhere believes that the next Greek government shall do anything other than abrogate all the agreements made with the ‘troika,’ then we have a bridge we’d like to sell them at a very high price”

With each passing day anger and frustration inside Greece continue to rise, and those that are currently holding power in Greece are becoming very unpopular.

One current member of Greek Parliament recently talked about what he thinks will happen in the aftermath of the next election….

“If we achieve a Left-dominated government, we will politely tell the Troika to leave the country, and we may need to discuss an orderly return to the Drachma”

#3 This Bailout Deal Is Going To Make Economic Conditions In Greece Even Worse

In a previous article, I listed some of the new austerity measures that are being imposed on Greece by this new agreement….

The EU and the IMF are demanding that Greece fire 15,000 more government workers immediately and a total of 150,000 government workers by 2015.

The EU and the IMF are demanding that wages for government workers be cut by another 20 percent.

The EU and the IMF are demanding that the minimum wage be slashed by more than 20 percent.

The EU and the IMF are also demanding significant reductions in unemployment benefits and pension benefits.

The austerity measures that have already been implemented over the past few years have already pushed Greece into an economic depression.

These new austerity measures will deepen that depression.

At the moment, the Greek national debt is sitting at about 160 percent of GDP.

We are being told that these new austerity measures will reduce that ratio to 120 percent by 2020, but already there are many in the financial world that are calling such a goal “comical“.

Even with this new deal, the Greek national debt is still completely and total unsustainable.  A “confidential report” produced by analysts from the European Central Bank, the European Commission, and the International Monetary Fund says the following about what this new debt deal is likely to accomplish….

There are notable risks. Given the high prospective level and share of senior debt, the prospects for Greece to be able to return to the market in the years following the end of the new program are uncertain and require more analysis. Prolonged financial support on appropriate terms by the official sector may be necessary. Moreover, there is a fundamental tension between the program objectives of reducing debt and improving competitiveness, in that the internal devaluation needed to restore Greece competitiveness will inevitably lead to a higher debt to GDP ratio in the near term. In this context, a scenario of particular concern involves internal devaluation through deeper recession (due to continued delays with structural reforms and with fiscal policy and privatization implementation). This would result in a much higher debt trajectory, leaving debt as high as 160 percent of GDP in 2020. Given the risks, the Greek program may thus remain accident-prone, with questions about sustainability hanging over it.

The GDP of Greece fell by 6.8 percent during 2011.

2012 was already expected to be even worse, and all of these new austerity measures certainly are not going to help things.

And every time the Greek economy contracts that makes a chaotic debt default even more likely.

#4 The Greek Parliament Must Still Vote On This Bailout Deal

It is anticipated that the Greek Parliament will vote on this new agreement on Wednesday.

It is expected to pass.

But when it comes to Greece these days, there are no guarantees.

#5 The Greek Constitution Must Still Be Modified

Under the terms of this new agreement, Greece is being required to change its constitution.

The following is how an article in The Economist describes this requirement….

Over the next two months Greece has promised to adopt legislation “ensuring that priority is granted to debt-servicing payments”, with a view to enshrining this in the constitution “as soon as possible”. These arrangements may not amount to the budget  “commissar” once threatened by some creditors, but the effect may be pretty much the same.

So will this actually get done?

We will see.

Forcing a sovereign country to modify its constitution is a very serious thing.  If I was a Greek citizen, I would be highly insulted by this.

#6 Several European Parliaments Still Need To Approve This Deal

The German Parliament still must approve this new agreement.  This is also the case for the Netherlands and Finland as well.

Many politicians in all three nations have been highly critical of the Greek bailouts.

It is expected that all of these parliaments will approve this deal, but you just never know.

#7 Private Investors Still Have To Agree To This New Deal

Private investors are being asked to take a massive “haircut” on Greek debt.  The following is how the size of the “haircut” was described by a USA Today article….

Banks, pension funds and other private investors are being asked to forgive some €107 billion ($142 billion) of the total €206 billion ($273 billion) in devalued Greek government bonds they hold.

There is absolutely no guarantee that a solid majority of private investors will agree to this.

In the end, probably the only thing that is guaranteed is that litigation regarding this “haircut” is likely to stretch on for many years to come.

#8 The Global Financial Community Still Expects Greece To Default

Almost all of the analysts that were projecting a chaotic Greek debt default are still projecting one today.  Yes, many of them believe that “the can has been kicked down the road” for a few months, but most of them are still convinced that a default by Greece is inevitable.

The following comes from a Bloomberg article that was released after the Greek debt deal was announced….

“The danger of Greece saving itself into economic depression and having to default and exit the common currency zone remains substantial,” said Christian Schulz, an economist at Berenberg Bank in London. Jennifer McKeown of Capital Economics Ltd. repeated her forecast that Greece will quit the euro by the end of the year.

The odds that this agreement will survive for very long are not great.

It will be nearly impossible for Greece to meet all of the conditions being imposed upon it by this new deal.  All of the politicians in northern Europe that are just itching to cut off aid to Greece will soon have the excuse that they need for doing so.

And the Greek people could decide to bring all of this to an end very quickly.  If they elect a new government in April that does not support this bailout agreement, the game will be over.

So don’t be fooled by all the headlines.

A chaotic Greek debt default has not been averted.

The truth is that a chaotic Greek debt default is now closer than ever.

If You Are A Blue Collar Worker In America You Are An Endangered Species

Have you ever heard of the dodo bird?  Once upon a time, dodo birds lived on the island of Mauritius in the Indian Ocean.  But if you go there today you won’t find any because they are extinct.  Well, if you are a blue collar worker in America today it looks like you are headed for a similar fate.  Blue collar workers are truly becoming an “endangered species” in the United States.  In the old days, the balance of power between business owners and labor was more even because they both needed each other.  But today that has all changed.  Thanks to robotics, automation and computers there is simply not as much of a need for physical laborers anymore and nothing is going to reverse that trend.  Big employers will continue to look for ways to replace men with machines, and there is nothing wrong with that.  But there is another major trend that is also destroying blue collar jobs in America that we should do something about.  Right now, it is perfectly legal for big corporations to shut down manufacturing facilities in the United States and send the jobs over to nations on the other side of the globe where it is legal to pay slave labor wages and where there are barely any regulations.  As you will see later on this article, this has been the biggest reason for the shocking blue collar job losses in America over the past decade.  The big corporations don’t care that you need to pay the mortgage and put food on the table for your families.  All they care about it the bottom line, and if dramatic changes are not made soon, the number of blue collar jobs leaving the United States will continue to increase.

Once upon a time, almost everyone who wanted a job in America could get one.  If you go back a few decades, you will find that about 95 percent of all men between the ages of 25 and 54 had a job.  Today that figure is struggling to stay above 80 percent.

If you are a blue collar worker in America, you are simply not valued.  Your bosses are constantly trying to think of ways to replace you or send your job overseas.

According to Reuters, 23.7 million American workers are either unemployed or underemployed right now.  The more “blue collar” you are, the more likely you are to be unemployed.  The following chart that shows the unemployment rate during 2010 broken down by level of education comes from the Bureau of Labor Statistics….

If you are an unskilled worker in America today, you simply are not needed.  Yes, once upon a time nearly anyone could go out and get a factory job, but those days are over.  Neither major political party seems the least bit interested in trying to keep manufacturing jobs in America.

Back in the year 2000, more than 20 percent of all jobs in America were manufacturing jobs.  Today, about 5 percent of all jobs in America are manufacturing jobs.

To have that huge of a shift in a little over a decade is absolutely mind blowing.

Many Americans had been hoping that Barack Obama would stand up for the working man like he promised to do.  But just like so many of Obama’s other promises, that one was totally worthless as well.

The Obama administration has been pushing hard for even more “free trade” deals that will allow big corporations to ship even more of our jobs out of the country.  The Obama administration simply does not value blue collar jobs at all.  In fact, U.S. Trade Representative Ron Kirk is running around telling the press that there are lots of things that “we don’t want to make in America” anymore.

If you are a blue collar worker, Barack Obama does not care about you.

He never cared about you.

In fact, the vast majority of the politicians in both major political parties do not care about you.

What they do care about is winning elections and taking care of the big donors that keep helping them win elections.

Many of those donors are systematically shipping huge numbers of our jobs overseas.

In addition, now that labor has become a “global commodity”, wages for the jobs that remain in America are being steadily driven lower.

A recent White House reported entitled “Investing in America: Building an Economy That Lasts” actually bragged that our trade policies have driven wages in America down.  The following chart is from that report….

We were told that the “one world economy” would be great for America, but the truth is that it has only been great for the giant corporations.  For the average working man, it has been a disaster.

But we should have all seen this coming.  It didn’t take a genius to figure out what was going to happen once you put American workers into the same labor pool as slave laborers on the other side of the world.  After all, what greedy corporate executive really wants to pay U.S. workers ten to twenty times as much compensation just because it is the “right” thing to do?

Today, formerly great cities all over America are being transformed into hellholes while shiny, new industrial cities are popping up all over China.

For example, a couple of decades ago the Chinese city of Shenzhen was a sleepy little fishing town.

In 2012, it is a teeming metropolis of over 13 million people.

Foxconn (the builder of iPhones, iPads and many other products that we buy) runs a factory in Shenzhen that employs over 400,000 people.  Most of those people work for about a dollar an hour.

A recent article posted on Business Insider described the incredibly long hours and the nightmarish working conditions that those workers must endure.  The following is a brief excerpt from that article….

A Chinese working “hour” is 60 minutes–unlike an American “hour,” which generally includes breaks for Facebook, the bathroom, a phone call, and some conversation. The official work day in China is 8 hours long, but the standard shift is 12 hours. Generally, these shifts extend to 14-16 hours, especially when there’s a hot new gadget to build.

At Foxconn, they don’t really care about the health and safety of the workers.  Workers are expected to do the same repetitive tasks as rapidly as they can for as long as they can.  When their bodies break down, they are fired….

Some workers can no longer work because their hands have been destroyed by doing the same thing hundreds of thousands of times over many years (mega-carpal-tunnel). This could have been avoided if the workers had merely shifted jobs. Once the workers’ hands no longer work, obviously, they’re canned.

But the Obama administration insists that allowing big corporations to ship our jobs over to countries with working conditions like that is “good for the economy”.

Well, it might be good for the profits of the largest corporations, but it is a total nightmare for the rest of us.  Just consider the following stats….

*The United States has lost an average of 50,000 manufacturing jobs per month since China joined the World Trade Organization in 2001.

*Between December 2000 and December 2010, 38 percent of the manufacturing jobs in Ohio were lost, 42 percent of the manufacturing jobs in North Carolina were lost and 48 percent of the manufacturing jobs in Michigan were lost.

*According to U.S. Representative Betty Sutton, America has lost an average of 15 manufacturing facilities a day over the last 10 years.  During 2010 it got even worse.  Last year, an average of 23 manufacturing facilities a day shut down in the United States.

*In all, more than 56,000 manufacturing facilities in the United States have shut down since 2001.

*According to one study, between 1969 and 2009 the median wages earned by American men between the ages of 30 and 50 dropped by 27 percent after you account for inflation.

*According to Professor Alan Blinder of Princeton University, 40 million more U.S. jobs could be sent offshore over the next two decades.

Are you starting to get the picture?

If you are a blue collar worker that cannot find a job, it is not because you have failed as a human being.

Rather, the truth is that you cannot find a job because of the failed trade policies of the federal government.

We are experiencing the bitter fruit of a “one world economy”.  Globalization was never intended to make the lives of American workers better, and now many are finally waking up and realizing this.

Hopefully, as Americans wake up on these issues they will fight to turn this nation in a more positive direction.

Unfortunately, way too many Americans are giving up hope completely.  The following comes from a recent article in the Guardian….

The year 2011 will be remembered as the time when many ever-optimistic Americans began to give up hope. President John F Kennedy once said that a rising tide lifts all boats. But now, in the receding tide, Americans are beginning to see not only that those with taller masts had been lifted far higher, but also that many of the smaller boats had been dashed to pieces in their wake.

As I have written about so many times, we are watching the middle class in America be systematically destroyed.

The economy is not getting better.  There may be moments when the economy seems like it is improving, but the reality is that we are mired in a nightmarish long-term decline.  If you are not yet convinced of this, please see this article and this article.

Even those running our economy are saying that things are not going to be getting much better any time soon.

For example, the President of the Federal Reserve Bank of Chicago, Charles Evans, recently admitted that the employment picture is not going to be much brighter than it is now by the end of 2012.  He recently said that “at the end of the year, we’re not going to be very different from 8.5 percent unemployment.”

And remember – history has shown us that most pronouncements by Federal Reserve officials are usually far too optimistic.

If you are a blue collar worker in America, there is simply not too much to be optimistic about right now.

You might want to think about how you and your family are going to survive without any work.

The millions of jobs that have been sent overseas are not coming back.  Even if you still have a decent job, now is the time to be developing a side business or developing other alternative streams of income.

What you don’t want to do is to just sit there and hope that somehow things will “magically” turn around if we just vote in the “right” politician.

If you want to get a really good idea of what is really going on with the U.S. economy right now, just go tour some of the formerly great industrial cities in the “Rust Belt”.

In Cuyahoga County, Ohio one out of every five houses is sitting vacant.  It is not that those homes are not needed – it is just that there are not nearly enough people with good jobs available to buy up all of the foreclosures.

So thousands of perfectly good houses are being torn down.  The following comes from a recent CBS News report by Scott Pelley….

Across America, recession-fueled foreclosures and plummeting home values have left countless properties abandoned and vulnerable to looting. As Scott Pelley reports, the problem has gotten so bad in Cleveland, Ohio, that county officials have demolished more than 1,000 homes this year – and plan to demolish 20,000 more – rather than let the blight spread and render nearby homes worthless.

Can you imagine that?

20,000 homes being demolished in one county alone?

Of course Detroit is in even worse shape than Cleveland.  If you can believe it, the median price of a home in Detroit is now just $6000.

For much more on all of this, please read my recent article entitled “Formerly Great Cities All Over America Are Turning Into Open, Festering Sores“.

It would be great if I could tell you that hope is just around the corner, but it is not.  The plight of the blue collar worker in America is going to get worse and worse.

But just because blue collar workers in America are an endangered species does not mean that you have to be a victim.

We should all seek to become less dependent on the system.

If you are completely and totally dependent on having a “job” (just over broke), then you have put yourself in a very vulnerable position.

That job could disappear at any moment.

Over the next few years, the number of good jobs is going to continue to decrease.  Things are going to be really tough.  But those that have prepared and that have tried to become more independent are going to be in much better shape than those that have not.

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